Sunday, May 6, 2007

Repositioning the videoconference

[TelePresence logo]Last month I went to Cisco to see a demo of its high-end videoconferencing system, introduced to the world last October. I saw a demo of both the Cisco TelePresence 3000 — with three 65" HDTV screens and a list price of $299K — and the Cisco TelePresence 1000, with only one screen at a mere $79K. As advertised, it was a lifelike experience, and my colleagues and I agreed that it was a great way to run a meeting if you could afford the capital cost and the bandwidth.

Part of Cisco’s effort to justify the $300K (and the 6-9 Mbps to run the three screens) is avoid using the term “videoconference,” which covers everything from PC-based solutions to other high-end solutions. Its two major HighDef rivals take a different tack. HP takes the V-word head-on, proclaiming “HP Halo: Light years beyond video conferencing.” Only Polycom — the longtime leader in low-end solutions and overall unit sales — refers to its HD products as “Professional - High Definition Video Conferencing.”

Of course, “videoconference” is part of the lexicon and “TelePresence” is not. Imagine my surprise last week when I was watching an episode of 24, and presidential chief of staff “Tom Lennox” (former childstar Peter MacNicol) comes on screen and announces to VP Noah Daniels (Powers Booth):

The Russian president is calling for you in the TelePresence suite. He’s insisting on a face to face.
How about that? With two sentences, we have
  1. an introduction to the buzzword;
  2. the implication that this is something important for the heads of state of major powers to use for their most important meetings; and
  3. the suggestion that a foreign president considers using the Cisco videoconferencing product as equivalent to a “face to face.”
Other than dropping the brand name — and the lingering Cisco logo on the TV screen — the product placement seemed natural and very effective. Looking at the Russian official arrayed on the screen (and over the shoulder of the US team) both made for a dramatic confrontation and showed the technology’s potential.

Cisco has a Flash clip of the sequence on their website, which also shows clips from an October promo of TelePresence 3000 on the Fox TV show Vanished (whatever that is) as well as placement of other Cisco products on 24. (For hardcore 24 fans, the distinctive ringing of the telephones at CTU Los Angeles is recognizably that of a Cisco VoIP phone). The level of product placement in 24 has drawn complaints from fans, but the use of a TelePresence suite seems more plausible than the claim that CTU network is impervious to attack.

[VP watching logo]Still, I wonder about the efficiency of using a consumer TV show as a way to sell a high-end business product. Of course, early in the product cycle, the goal is brand (and even category) awareness rather than closing a specific sale. And it could be relatively cheap: one guess is that the placement costs $150K — less than one TelePresence 3000.

Photo credits: all pictures taken from ”24 (Season 6): 1:00 a.m.-2.00 a.m.”

Technorati Tags: ,


Nancy said...

How long do you think it will be before telepresence is "commoditized" and omnipresent in mainstream business? My guess is 2-3 years. My understanding is that there is no interadaptability between one platform to another, which will have to change.

I think this technology will certainly go. It saves so much time and covers distances instantly. Bottom line savings of time and money, once you pay off the initial investment, will make it a must-have communiations tool.

Nancy Stall
Global PR & Marketing Communications

Joel West said...

I agree and I disagree. On the one hand, I get my videoconferencing from Skype — purchase cost $0, marginal cost of use $0. It doesn’t get more commoditized than that.

On the other hand, triple 65" plasma screens and 9mbps bandwidth are not going to be available to every firm any time soon. It’s a small market, that initially will have limited economies of scale. The Fortune 500 will want a reputable firm standing behind it, so if not Cisco then HP or someone comparable.

However, I agree that consumers and SOHO will want something similar and so there will be $1,000 products instead of $100,000 products. These will certainly become commoditized.

Interestingly, Cisco never entered the SOHO or low-end market, either because of their cost structure or their brand. They had to buy Linksys to get into this market. This raises a good question: when will Linksys have a telepresence product?