A Look at the Telepresence Market, Part 2: Managed Service Provider

The realities of our current economy mean that companies must look for ways to reduce costs and improve productivity. While some companies will choose to clamp down on spending, others are still will 2/12/2009 4:42 AM Eastern

A Look at the Telepresence Market, Part 2: Managed Service Provider

Feb 12, 2009 9:42 AM, By Linda Seid Frembes

Part 1

A group uses the Cisco TelePresence solution.
Credit: Photo Courtesy of Cisco Systems

A group uses the Cisco TelePresence solution. Photo Courtesy of Cisco Systems

The realities of our current economy mean that companies must look for ways to reduce costs and improve productivity. While some companies will choose to clamp down on spending, others are still willing to expand capital budgets in order to realize cost-savings in the long term. “In 2009, I think we’ll continue to see a schizophrenic economy. There will be a drive to cut costs by investing in new technology, but some companies won’t spend at all,” says Jeff Prestel, general manager of video business unit for BT Conferencing, a business unit of BT Group. “As soon as corporate budgets loosen, we will see incredible growth in the conferencing market.”

Prestel, who manages the video sales and service delivery for BT Conferencing, says that the corporate market represents 60 percent of their revenue. “Our immersive telepresence sales are still growing through the roof,” he says. “The total cost is approximately $3 million for five rooms, including network improvements and managed services, so it’s a significant investment. Economic conditions are spurring customers to look at flexible financing options, but the overall upwards sales of telepresence shows that it’s probably not a fad.”

BT Conferencing is the number one conferencing provider in the United Kingdom and Europe, and it has offices in more than 75 countries. Over the past several years, it has worked to strengthen its relationship with Cisco, a leading manufacturer of telepresence systems. In 2008, BT earned its Cisco's Global Certification status and was the first service provider to complete the Cisco TelePresence Global Authorized Technology Provider (ATP) program. Currently, the company is the number one provider of Cisco TelePresence services in world.

“In the past, there were three major issues with videoconferencing: It was too hard to use, it was unreliable, and the systems were costly. We try to address those issues by making it easy and cost-effective,” says Prestel, who adds that BT takes a holistic approach to managing a customer’s video systems.

The company takes care of planning and design with the customer, can recommend network upgrades and system hardware, do the install, handle the project management, and train the user. BT also offers an array of maintenance and support, from as simple as remote support all the way to onsite support with dedicated onsite staff.

Their flexibility in offering technology and services includes the recent availability of BT Global Video Exchange, a service that facilitates Cisco TelePresence connections between companies. The goal of the service is to encourage usage among business partners and, therefore, a quicker return on investment. The backbone of the service is the company’s international Multiprotocol Label Switching (MPLS) network, of which BT worked closely with Cisco to implement routers that simplify VPNs over IP networks.

Customers who use the BT Global Video Exchange have access to flexible menus of services that really showcase the size and reach of BT Conferencing. Services include set up, live-call monitoring, and 24-hour help-desk support, as well as conference production assistance. “We offer concierge services that take the worry out of operating the telepresence system,” Prestel says. “If there is a problem, a user can ping the operators, who are constantly monitoring network traffic and traffic on the codecs. Our goal is to address problems before the user even knows anything happened.”

The company also recently rolled out a managed services package for Polycom RealPresence Experience (RPX) and Polycom Telepresence Experience (TPX), called BT One Source. The One Source solution will provide customers with a single point of contact for all of their Polycom conferencing needs.

Despite offering services that emphasize ease-of-use, the biggest barrier to entry into the corporate market is getting C-level executives to agree to the price tag. “The Cisco experience is quite different than others, and can be hard to grasp,” Prestel says. “You must sit them down and have them see and hear it. Then you can have the discussion about applications of the technology and the ROI.”

And once executives are onboard, the ROI discussion branches out into ways to reduce travel, improve collaboration, speed product development, and even become a greener company. BT Conferencing maintains demonstration locations in New York, Denver, and London so that customers can experience each system for themselves. Prestel notes that various telepresence systems are geared for different environments. “The Polycom RPX is great for auditorium-style seating as a way to teach and do distance learning. The Tandberg T3 has the benefits of a Cisco system but focuses on a simple GUI, much like an iPod,” he says, also adding that some manufacturers offer greater interoperability with legacy video systems.

Another point to note is that telepresence systems have specific network bandwidth requirements. “We are seeing telepresence customers choosing a dedicated overlay network service rather than expanding their network,” Prestel says. “It is a great option that other vendors can’t offer. BT is a leader in immersive telepresence because of our breadth of services and our constant innovation in partnership.”

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