Business video goes primetime: are IT managers ready?

“The network is literally going to transform the way we live, work, learn and play,” Cisco Systems chair and CEO John Chambers says in his best plantation drawl. “And if there is one aspect of the network that is the killer app, it is video.” We didn’t actually interview Chambers, who one assumes is a fairly busy guy. We saw and heard him say this in a video aptly entitled, “Video Changes Everything,” originally broadcast over the Internet – webcast – in June, and later posted at the Cisco Website. In the video, a professional but not overly slick production – something most big companies could afford to produce if they were so inclined – various Cisco spokespeople outline the company’s strategy and philosophy around enterprise video, and yack about new products. To support the company’s argument that video is changing the way we do business, Chambers cites growing use of high-quality videoconferencing tools such as his firm’s almost-as-good-as-being-there TelePresence Meeting solutions, as well as corporate-wide desktop videoconferencing, network-based surveillance cameras and video signage. And of course streaming video like the 40-minute “Video Changes Everything” clip. While the message is self-serving, it’s not a lie. Video does appear to be on the cusp of becoming a mainstream enterprise application – and most or all of it is or will be on the network. That could have profound implications for IT and telecom managers. Demand keeps on growing According to a January 2008 Yankee Group survey of over 500 large enterprises in the US and Asia/Pacific, deployment of video-based collaboration solutions is set to quadruple in the following 12 months. And 90% of enterprises surveyed said they would deploy a video-based collaboration system during the next two years. Zeus Kerravala, senior vice president of Yankee's Enterprise Research group, says he has seen a significant increase just in the last year in both interest in and use of all forms of video among his clients – conferencing, streaming, surveillance, signage. And Wainhouse Research reported in February that the videoconferencing industry enjoyed a record year in 2007, with unit sales up 29% over 2006 and revenues up close to 40%. Annual growth rate for the previous six years: 10%. This is especially remarkable given that the numbers are only for room video systems, not the networked desktop video Cisco is pushing and that, many analysts say, is driving the market – although the line between the two has long since blurred. Why has video suddenly taken off? The business and market drivers are several. Kerravala calls it “a perfect storm” for business video. Travel cost avoidance was always the number one benefit used to build business cases for investing in videoconferencing. And certainly the increased cost of travel because of rising fuel prices is a factor in the recent surge. More and more companies too are realizing that travel takes an enormous toll on employee productivity, especially with longer airport delays due to heightened security. They simply can’t afford to have high-paid executives cooling their heels in airports, however much mobile technology mitigates productivity losses. Vendors claim the meteoric rise of very high quality, very easy to use telepresence systems – which according to Wainhouse contributed $40 million in revenues to vendors in 2007 – is largely justified by expected productivity gains among executives and other high-wage employees. Yankee Group itself recently switched to videoconferencing for an annual all-day strategy session. What had been a three-day affair with travel now involves only a single day away from regular duties, Kerravala says. Most analyst say the need to be green, or seen to be green, is another factor. According to Kerravala, Yankee Group’s decision to virtualize its strategy session was taken in part because of a desire to be “a good social citizen.” Respondents to a survey of end users and IT managers in U.S. businesses conducted by market research firm In-Stat also cited environmental concerns as a reason for video conferencing – which 28% were doing. Two-thirds of those companies had policies in place stipulating when employees should use video rather than travelling. “A lot of that is trying to reduce travel costs,” says senior analyst David Lemelin, the survey report’s author. “But at the same time, a lot of businesses are trying to make a statement about being green.” Video’s perfect storm But as topical as rising fuel prices and green initiatives are, more important ingredients of the perfect storm have been brewing for much longer, says Jayanthe Angl, a senior research analyst with London, ON-based Info-Tech Research Group. He cites two. The technology got way better. And companies came to need it more because they’re more distributed. “The biggest advance we’ve seen is the switch from traditional ISDN-based video systems and circuits to IP-based systems,” Angl says. “They offer more flexibility, higher quality, greater scalability. They’ve really made video a much more realistic opportunity for a lot of organizations.” Too often in the past, users were put off by poor audio and video quality – stuttering, jittering video, crackling audio, poor synchronization – or the hassles involved in scheduling and reserving equipment or rooms and setting up calls. “Not only didn’t add anything ,” Kerravala says. “It could actually take away from the experience.” This was reflected in utilization statistics for videoconferencing rooms which frequently sat at 20% or lower, he says. But in companies that have implemented telepresence systems in recent years, utilization is often above 70%. “More people using now, and they’re using it more often,” Kerravala says. Even vendors, such as Tandberg, the Norwegian company that along with Polycom Inc. dominates the traditional room videoconferencing market, admit the technology wasn’t that great in the early 1990s when big companies first started getting serious about videoconferencing. “We’ve come a very long way,” says Peter Nutley, director of product marketing in Tandberg’s U.S. operations. Telepresence systems that use multiple large flat panel screens, deliver HD video and can be turned on like an appliance are the standard bearers. They can make participants almost forget they’re miles apart. Telepresence systems are too expensive for most organizations, of course. Tandberg’s Experia product costs about $200,000 per room, and it’s in the middle of the range. But as Angl notes, “What telepresence systems have done is cast a new light on video and raised the quality bar across the board.” Even medium-priced room systems can now deliver HD-quality video – given enough bandwidth. Indeed, vendors are now bringing IP-based desktop video products to market that can deliver HD to a softphone on a laptop. A new HD-capable version of Tandberg’s Movi desktop video system, scalable to thousands of users, is due out in first quarter 2009. The In-Stat research that Lemelin led showed clearly that many corporate users abandoned videoconferencing years ago because of quality and convenience issues, but are now generally satisfied with the experience when they try current technology, and express interest in using it more. Better technology alone wouldn’t be enough to crack the video market open, but companies today are also more likely to have distant branch offices, suppliers and partners dotted around the globe and employees teleworking. And they more often need to pull together work teams with members geographically dispersed. “A virtual work force requires video to collaborate effectively,” Angl says. Not just video, to be sure, but video as well as Web conferencing, presence, instant messaging and other collaboration tools. Many of the ingredients, in fact, found, along with video, in unified communications (UC) systems such as Microsoft Corp’s Office Communications Server 2007. That is another factor in the uptick in interest in and use of video, Angl says. More companies are implementing or planning to implement UC systems, which have video capabilities built in. It’s not just video for conferencing either. On-demand streaming video for training, CEO messages and company “town hall” events also become more attractive. “It’s difficult to assemble people in one place , so having access to on-demand video training, to be able to access it even on the road, that’s an invaluable tool for many organizations,” Angl says. “It’s the same when you’re trying to extend the corporate message out across a distributed workforce.” Vendors such as Cisco and Tandberg may also have a point when they argue the twin mantras of ‘accelerating decision making’ and ‘scaling knowledge.’ Staying nimble is key to survival in competitive and fast-moving markets. Collaboration tools in general, but perhaps especially video, make it easier to bring people together quickly for ad hoc meetings that can speed decision making. Many companies are also using high-quality visual communication to make knowledge resources available across the organization, with top experts dispatched, virtually, wherever they’re needed. For example, StatOil, a Scandinavian oil company, uses Tandberg video systems to allow experts on the mainland to monitor and troubleshoot equipment on remote oil rigs in the North Sea. Volkswagen is using the technology to allow top engineers to remotely troubleshoot problems local mechanics can’t solve. At the same time, network-based IP video surveillance systems are replacing traditional CCTV, and being deployed in places where CCTV would have been impractical or prohibitively expensive. IP video lets companies monitor from anywhere on the network and eliminate separate coax networks needed for CCTV. The network must be ready IT managers skeptical about the importance of video on the network may think first about what video will do to performance of other applications. But that’s getting it backwards. The real issue if you’re going down this path is whether the network is equal to the demands of video. Two things are crucial: bandwidth and quality of service (QoS) – lots of the former, proper implementation of the latter. The impact of inadequate bandwidth or poorly implemented QoS can be “drastic” with video, Angl notes: latency and jitter, manifesting as low-quality, stuttering video and poor audio-video synchronization. All the ills, in fact, that turned users off videoconferencing in the early days. The real impact is lost confidence in the technology by users. That’s one of the things that came out loud and clear in the In-Stat research. “If the voice or video quality is not fair or good – we’re not saying it has to be telepresence but there has to be an absence of delay and jitter – it becomes a very frustrating experience,” Lemelin says. And if it’s frustrating, employees won’t use it. “If rooms remain at sub-10% utilization, and that can happen, it means the project failed,” Kerravala says. Especially when some organizations are seeing 70% utilization. Best practices around QoS are well enough understood. Organizations that have already implemented IP telephony – and few will do video before voice, Angl points out – have probably already done the heavy lifting on QoS. Bandwidth remains an issue. Part of it is just ensuring there’s enough. Tandberg’s Nutley suggests that 1.5 Mbps of throughput is adequate for HD, but that’s for each connection. Companies attempting to get by with DSL for branch office links probably need to move to 10 Mbps Ethernet, Angl says. Upgrading the local network may be a hidden cost of implementing corporate-wide video, but as Kerravala points out, as many as half the enterprise networks out there date from before 2000. In other words, they’re due for upgrade anyway. “If you’re going to upgrade now,” he says, “upgrade to a network that is video capable.” Using video to connect to people outside the company’s main facility can require additional technology, including bridges to enable more than two participants in a conference, gateways to connect users on different networks and gatekeepers that provide, among other things, bandwidth management to ensure the pipe is open when needed. “The biggest thing is to do as much prep work up front as you can so you understand the impact it’s going to have on the network,” Kerravala says. “Measure twice, cut once.” Choosing the right tool for the job is another key, Angl says. For example, lower-quality desktop videoconferencing may not be the best bet for cross-country executive summits. “Do the due diligence,” he urges. “Carefully examine needs before establishing which solutions to choose.” Usability is also critical. Part of it is making sure employees are trained on how to use the technology, but part of it is choosing technology that is easy to use. “One of the things users have frustration with is delays in scheduling and setting up conferences,” Lemelin notes. “It’s what drove some of these folks away in the first place.” Some modern videoconferencing systems are very easy to use, with Web-based, self-service scheduling. Lemelin says desktop video is getting more traction than room-based videoconferencing in many of the companies his firm surveyed, exactly because users can schedule and set up conferences themselves at a moment’s notice. Bottom line: video on the network is not rocket science, but it’s no slam dunk either. “If done correctly, video can be very, very helpful for an organization,” Kerravala says, “but if done wrong...” His voice trails off ominously. “I can’t emphasize enough how much all the up-front work matters.”

Business video goes primetime: are IT managers ready?

News | 09/22/2008 2:59 pm EDT

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