Thursday, November 22, 2012

Will the Perfect Storm Sink Cisco's Collaboration Boat ...

Cisco_CTS_3010.jpg
By Andrew W. Davis / No Jitter

Three trends--including the possibility that high-end telepresence has peaked--are threatening to swamp Cisco's efforts in video.
Much of the news coming out of Cisco recently has described the company's collaboration business as "struggling" or disappointing, with indeed much of the blame being attributed to the company's telepresence product line and business unit. From my perspective, it seems that Cisco is being hammered by three separate weather patterns that have come together to shake the boat to its collaboration foundations.

1. The telepresence hype has passed. Cisco rocked the world in late 2006 with the introduction of the CTS 3000, a multi-codec room system that delivered the illusion that the remote people were in the same room with you. Using the terminology of Gartner's hype cycle model, telepresence has evolved from the peak of inflated expectations to the trough of disillusionment as customers have come to grips with the facts that 1) these systems are expensive to buy, deploy, operate, and maintain and 2) a near-telepresence experience can be created at 1/8th the cost.

In the early stages of the telepresence hype cycle, nearly every vendor gave nearly every videoconferencing system a "telepresence" moniker, including such beauties as immersive telepresence, adaptive telepresence, personal telepresence. Much of this was a reaction to the not-so-subtle Cisco brain-washing thrust that telepresence was new, exciting, and transformative while video conferencing was a legacy, failed technology. The great reversal in thought was punctuated by Cisco's blockbuster $3.2-billion acquisition of Tandberg, announced in October 2009 and consummated in April 2010.

Today, the world has come to recognize that "telepresence" has come to describe the multi-codec systems that deliver an immersive experience. Analyst firms have adopted "multi-codec" vs. "single-codec" as clear terms that describe distinct product and market categories and that enable markets to be measured.

Data collected from vendors each quarter by Wainhouse Research suggests that the multi-codec segment is anything but a high-growth video conferencing segment. In fact, 2010 may turn out to be the year of "peak telepresence." Making the immersive, multi-codec segment the face of Cisco's videoconferencing thrust has not proven to be an advantageous positioning strategy.

Telepresence_Shipments_2008-2012.png 2. The overall videoconferencing market is struggling. Just one year after Cisco's acquisition of Tandberg, one of the two dominant vendors in the global video conferencing space, the market began some wild gyrations. Industry revenue growth is no longer a certain bet. In fact, worldwide revenues for room and executive systems for the first half of 2012 are down 7% compared to a year earlier.

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About the Author
andrew_davis_2.jpgAndrew W. Davis is a researcher, analyst, and opinion leader in the field of collaboration and conferencing. He is a co-founder of Wainhouse Research, a boutique analyst firm that concentrates on collaboration products and services, including audio, video, and web conferencing and unified communications. Prior to Wainhouse Research, he held senior marketing positions with several large and small high-technology companies including Data General, Apollo Computer, and Megascan. Andrew has published over 250 trade journal articles and opinion columns on multimedia communications, videoconferencing, and corporate strategies as well as numerous market research reports and is the principal editor of the conferencing and collaboration industry's leading newsletter, The Wainhouse Research Bulletin. Andrew focuses on covering the video side of the collaboration market. He also specializes in strategy consulting and new business development for Wainhouse Research. A well-known industry guest speaker, Mr. Davis holds B.S. and M.S. degrees in engineering from Cornell University and a Masters of Business Administration from Harvard University.

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Source: http://www.telepresenceoptions.com/2012/11/will_the_perfect_storm_sink_ci/

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