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Telepresence: Enterprise Solutions to Consumer Devices

New Delhi, India, 04 June, 2011

According to Tavess research, The business spend on Telepresence is set to see a massive increase as enterprises across the world continue to focus on cost-cutting and productivity. The market for Telepresence in APAC is growing at a CAGR of over 50% for the period 2008-2013 and is expected to reach US$0.3 billion by end of 2013 (excluding services); and the growth rate in India is in pace with that of APAC, and is expected to reach US$70 million by end of 2013; CAGR at the global level for the same period is nearly 25%.

While Cisco and Polycom contend for the bigger slice of the market, in response to this emerging market opportunity, number of new players are striving for notice. Most vendors have something common in their GTM strategy – a verticalized approach. Healthcare, public sector, education, BFSI and high-tech are few verticals most targeted. Tavess believes that this targeted approach well supported by for-the-industry offerings helps make quick inroads successfully. New to the market, Business Octane (of India) too indicates a verticalized GTM with ‘for-the-government’ offerings.

Tavess believes that Telepresence is an expensive proposition which limits these systems to a very high end niche. Further, Tavess observes that most players target large enterprises due to the obvious affordability factor and relevance from travel perspective, but the potential of the growing SMB segment is often overlooked despite standing relevance from cost-control perspective. With an average list price of US$300,000, cost is a concern in emerging markets like India.

Tavess believes that ‘Telepresence-as-a-Service’ will be attractive not only in emerging markets but everywhere. Over time, Telepresence-as-a-Service can exceed traditional installations in count and revenue. Few vendors are found at work on this already - VADS partnership with Cisco (Malaysia) is an example of this, offering 3 or 5-year contract options. Another example is the Cisco-Tata’s network of public Telepresence meeting suites, mainly in the UK and USA, and many coming around the world including emerging countries like India. These are available for both business users and consumers for hourly bookings. Cisco/Tata has public Telepresence sites at the Taj hotels in London and Boston, targeted at traveling business-users, at rates ranging US$299 to US$899 an hour.

Tavess notes that Cisco alone has over a hundred public Telepresence suites and expects this count to multiply over the years ahead. Another vendor worth a mention here in the context of addressing the SMB opportunity is Vu Telepresence, for its low cost HD solution for SMBs designed to meet the three key constraints that stand to benefit from Telepresence: lack of specialized IT resources, tight budgets, and limited bandwidth.

Giving a touch of Telepresence to unified communications is an opportunity vendors can address by making UC interoperability a reality. Citrix is doing just that – giving its GoToMeeting a Telepresence touch, a very recent development. A seismic shift is expected in the way businesses communicate and collaborate, and even consumers. Consumer market for Telepresence cannot be ignored. While mega installations may not be frequently expected, public-suites can be attractive to consumers living far from family and friends.

Taking it home, last year, Cisco introduced a consumer edition of Telepresence system - ūmi, which connects to an existing HD television and a broadband internet connection, at a retail price of $499 with a monthly fee of $24.99 for unlimited ūmi calls. While it may be argued that it is priced high to sell as a home commodity, there is no question that with time, more options and competition against Cisco’ ūmi will emerge – and this can even replace traditional home/consumer-communications in the future.

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