Flying fears spark growth around videoconferencing

In the wake of the terrorist attacks of Sept. 11 and a resulting trepidation surrounding air travel, businesses are looking for ways of nurturing customer and vendor relationships on the ground instead of in the air. One alternative beginning to gain interest is videoconferencing technology.

According to a recent release by San Jose, Calif.-based research firm Frost & Sullivan, revenues for videoconferencing equipment and related services are expected to see spikes of 25 to 50 per cent in the next few months – a direct result of the fears instilled in the public after the attacks in New York and Washington, D.C.

“So far, it is still early to start seeing a major impact,” said Roopam Jain, strategic analyst, conferencing, for Frost & Sullivan. “But we do know that service providers have seen an increase of 30-50 per cent in videoconferencing. It seems like the existing customer base is using it more actively in the times when people want to avoid travel.”

Jain said that widespread adoption of video and Web-based conferencing will come with a gradual acceleration. She did note that although it is certainly an alternative for non-essential travel, videoconferencing will never replace travel.

“The experience of the handshake is very powerful,” she said.

Prior to the events of Sept. 11, the markets for video and Web conferencing were relatively small. Jain explained that there were three major barriers to widespread adoption: inadequate technology, cost constraints and cultural issues.

“The technology barriers have existed for videoconferencing for many years and it is changing at a fast pace,” Jain said. “There has been a tremendous leap in technology and audio/video quality. In terms of cost, the cost of equipment has come down. Systems that were available for US$30-35,000 just three years ago are now available for less than US$5,000.”

Jain said that these factors and the increased demand for videoconferencing management tools will propel the industry forward over the next year.

Paul Stacey said he sees Web conferencing taking more marketshare than the videoconferencing technologies that have been offered by telephone companies for the past few years. Stacey, the director of corporate education for the Technical University of British Columbia in Vancouver and a member of the TeleLearning Network of Centres of Excellence, said there is a quality issue with videoconferencing done over the phone.

“When we start talking about videoconferencing over the Internet, the tools enable more than what video and audio deliver,” Stacey said. “What they also enable is many of the tools to allow you to share applications online. When we are talking about this in a telelearning environment, we are talking about a more robust set of features and functions than what has previously been done. There is already a dramatic increase in these tools and what you have is a scenario where organizations are looking for ways to not have to send people on planes. I think it has become a much higher profile market segment than it has previously.”

Jain agreed and added that video and Web conferencing will excel as a viable alternative to travel.

“It is not going to be substantial and I don’t think the 50 per cent growth rate that the service providers have seen in the months after Sept. 11 is going to be sustainable for a long time,” she said. “But, yes, videoconferencing is an alternative to travel.”