Issue Focus Hot Topic: Boardrooms and MCSi

Hot Topic: Boardrooms and MCSi Despite the recent decrease in business travel, boardrooms will not sit empty. In the midst of economic downturn and decreased
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Issue Focus Hot Topic: Boardrooms and MCSi

Jan 1, 2002 12:00 PM

Hot Topic: Boardrooms and MCSi

Despite the recent decrease in business travel, boardrooms will not sit empty. In the midst of economic downturn and decreased corporate spending, the videoconferencing trade has held its ground. An increasing number of companies are looking to videoconferencing solutions as an answer to tight budgets and general travel concerns, keeping boardrooms alive.

In 1998, Michael Peppel, chief executive for MCSi Inc., began to explore a line of development for the old Miami Computer Supply, a distributor of office automation and visual presentation products. Today, the company has a new Systems Integration business for networked audiovisual systems with large, high-profile customers. Its revenue rose from 3% of MCSi's overall sales in 1998 to 43% of 2001 projected sales.

Factoring in the cost of a videoconferencing system, do corporations really save money in the long run by cutting their short-term travel budgets? Peppel estimates that by cutting companies' travel costs by 25%, videoconferencing gear could pay for itself in nine months. As a matter of fact, equipment and other variable costs for videoconferencing have also dropped, potentially lowering the end-user costs even more. Clients that used to decline videoconferencing additions to their contracts are now calling to ask for it.

MCSi is poised for more growth: Customer requests for systems that include videoconferencing are up 50% from before September 11. And Peppel plans to build MCSi's Systems Integration unit to 60% of its total sales in the next 24 months, with product sales providing 20% of overall revenue and the rest to come from the Managed Services division.

Information gathered from The New America, November 23, 2001, “Travel, Economic Fears Help Lift Prospects Here” By Alan R. Elliott, for Investor's Business Daily.

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