I’ve been following the videoconferencing market for some time and it has been a fascinating ride. The technology was first demonstrated at the World’s Fair back in 1964 and it was slated to quickly replace the telephone. Thirty years later Intel entered this market only to have Andy Grove, one of the most successful tech CEOs of all time, later write it was the biggest mistake he’d ever made. HP entered this market a decade later with its amazing Halo system and then later sold it off as another failure. This decade Logitech, among others, are taking a shot at the market.
But while these have all been positioned as a way to avoid the time and expense of air travel, why isn’t videoconferencing the norm and air travel the exception rather than the other way around?
Technology, interoperability, ease of use, cost
The first three theories of why videoconferencing didn’t take off sooner were that the technology wasn’t good enough, the system from one vendor wouldn’t work with another, you needed to take classes to learn how to use the systems, and they were wicked expensive.
Those first AT&T systems were pretty horrible, but technology improved so you could connect people with reasonably high fidelity. Then latency kicked in and even though you had a good picture the length of time it took to transmit and decode both the audio and video signal made the things annoying to use. Over time latency got lower and today’s systems can transmit HD resolutions or higher with little noticeable latency.
For years if you bought a system from one vendor you couldn’t talk to another vendor’s system. This would be like having an iPhone that only could call other iPhones. Given that the telephony industry first brought this technology to market and clearly understood that a phone product needed to talk to all other phone products this mistake still makes me wonder about the intelligence of the initial videoconferencing product managers. But, eventually products like Skype came to market that sat above these systems and allowed them to work together regardless of the vendor that supplied them.
If there is a posterchild for horrid ease of use it had to be the first several series of videoconferencing systems. Generally, you had to run down an expert to set the thing up before the call and hope the other side had a similar expert handy or you couldn’t make the call. Today if you can figure out Skype or WebEx, you can do a video call and experts are no longer needed.
Cost kind of went crazy for a while with these systems. Generally a cheap system cost around $20,000 for each office that you were connecting, but it could cost upwards of a quarter million dollars and you had to dedicate a separate room just for this capability. For that you could get multiple screens and there was one HP Halo implementation at Dream Works where one side of a room was entirely the videoconference display so that the Hollywood and New York offices could have staff meetings and make it look like everyone was in the same room. But the cost of that was not only $250,000 initially or more, but an additional $10,000 plus a month for management and maintenance. The system Logitech just launched is closer to $1,000 and doesn’t need a management contract. This system, for the money, may be the best solution currently in market from a major brand. Low cost, low latency, easy to use, and actually pretty attractive, but why will it fail to reach its otherwise glowing potential.
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