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Video-Enabling Presence Portals

September 21, 2006Irwin Lazar

Principal Analyst, Nemertes Researchhttp://www.nemertes.com/

© Copyright 2006 Nemertes Research

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Agenda

• The Virtual Workplace• Presence as an Enabler• The Presence Portal• IP Video Conferencing• Standards• Beyond the Corporate Boundary• Recommendations

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The Virtual Workplace is Here

• 58% of IT Executives considers their company to be a virtual workplace.

• More than 75% of them report using real-time communications technologies today.

• 90% of employees work in locations other than headquarters.

• Between 40% and 70% of employees work in different locations from their supervisors.

• The number of virtual workers has increased by a whopping 800% over the past five years.

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What Real-Time Applications do you use?

97%

80% 76%

54%

16%7%

0%

20%

40%

60%

80%

100%

120%

Audio C

onferen

cing

Web C

onferen

cing IM

Video C

onfer

encin

g

Presen

ce

RTCD

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Upgrade WAN infrastructure (length of time depends on complexity)

Corporate buy-in

Initial VOIP deployment or pilot

Troubleshoot

Additional VOIP Deployments

Decide on additional applications

Planning

Network optimization, management, security

Videoconferencing, wireless

Add Unified Communications

Collaborative Applications; Contact Centers

Advanced UM integration

12 24 36 48Months

Convergence Timeline:

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Presence As The Killer App

• Presence Drives Real-Time Communications…

• And Bridges the Virtual Workplace Gap

• But the Value is Hard to Quantify;

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Presence Functional Model

Room-to-Room Video Over IP

Wireless Voice Over IP/Mobility

IP Enabling Contact Centers

Presence

Desktop Video

Instant Messaging

Unified Messaging

Audio conferencing

Web Conferencing

Real-time CommunicationsDashboard

Industry-specific (imaging, distance

learning, location tracking, physical security)

Network optimization, management, security

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Real-Time Communications Dashboard

• Unifies– IM– Conferencing (audio,

video, Web)– Voice (point-to-point

calling & related features)

– Unified Messaging– Presence

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RTCD Value

• Low current implementation, but growing interest

• Average price customers willing to pay increased from $291 to $437 per seat.

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Video Conferencing Evolution

• Video Conferencing Then:– Room-based– Dedicated circuits or on-demand services such as ISDN– High bandwidth 768 kbps (128 kbps for single ISDN BRI)

• Drawbacks– Separate high-cost network– Limited flexibility (what if you aren’t near a room?)– No ability to tie into other applications (e.g. presence/web

conferencing

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Video Conferencing Trends

• Video over IP (Trunking)• Desktop video conferencing

– Allows workers to participate regardless of location

– Integration with web conferencing systems and room-based systems

– Cheap - all you need is a USB camera, speakers, and microphone

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IP Video Provides Cost, Productivity Benefits

• The next application organizations consider after VOIP.

• Drivers:– Cost savings (travel)– Improved employee

productivity– Project

collaboration/branch-office workers

• Benefits (room-to-room)

Average Hours/Month 80Average Per-Hour Rate $250.000Total Monthly Cost $20,000Average IP Video bridges $162,189Operational Startup $68,000Payback/months (ALL calls) 11.51Payback/months (50% of calls) 16.33Payback/months (30% of calls) 38.36

Videoconferencing Costs

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Video Plans on the Rise

• 30% are using video over IP today• 25% have plans to use room-to room

video over IP • 37% plan to use desktop video over IP • By 2007-2008, a growing number of

organizations will use both room-to-room and desktop video conferencing over IP

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Vertical Breakdown

Currently using

Room-to-Room Video

25.0%

20.0%

15.0%

10.0%

5.0%

0.0%

Perc

ent

Currently using

Currently using

Currently using

Currently using

Currently using

Currently using

Currently using

Currently using

Hospitality

Transportation

Software/High Tech

Professional Services

Manufacturing

Retail

Education

Healthcare

Financial Services

Room-to-Room Videoconferencing, by Industry

4% 4%

17%

22%

4% 4%

9%

17%17%

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IP Videoconferencing, Desktop vs. Room-to-Room

21.79%

11.54% 11.54%

6.41%

1.28%

29.49%

17.95%

29.50%

9.00%7.70%

3.80%0.00%

37.20%

12.80%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

30.00%

35.00%

40.00%

Using Evaluating Planned for2006

Planned for2007

Planned for2008

No Plans Unsure

DesktopRoom-to-room

Desktop vs. Room-to-Room

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Next Generation Video Conferencing

• High Definition - Telepresence– “Next best thing to being there” clarity– Examples:

• HP HALO• LifeSize• TANDBERG, Polycom

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HiDef Video Conferencing• System Limitations

– Bandwidth (1Mbps up to 54 Mbps)– Costs

• HALO - $550k initial cost, $30k recurring cost (per month, per room)

• PolyCom / LifeSize initial offerings at $12,000 for a room-based system, plus monitor

– Scalability• HALO is only point-to-point• Scalability of other systems limited by available

bandwidth

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Network Impact

• Video is bandwidth intensive– Minimum of 128 kbps– Codecs matter

• Newer codecs such as H.264 and H.264 SVC reduce bandwidth requirements

– But at the expense of increased computational requirements

– Troubleshooting is difficult• CPU issues, not just the network

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Failure!

Typical PitfallsInsufficient

ROINo baseline assessment

Narrow vendor

assessment

Rushing through project

Poor design,

engineering

Low-quality products Poor

management tools

Lack of training

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When do Standards Matter?

• SIP/SIMPLE are the clear winners in the standards battle…

• …but IT executives don’t really care

• What they want are open products that play well with others

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Architectural Issues: Today and Tomorrow

• Hosted vs. In-House• Network Architecture• Security: Top Priority• Beyond the Enterprise Boundary

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Network Impact• Re-architecting the

network to support high-bandwidth, any-to-any traffic flows

• No guarantees for home users

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Beyond Network Boundaries

• How to extend video conferencing to partners, customers, suppliers?– Direct peering model– Third-party peering services– Public services (SightSpeed/Skype)

• Likely a mix-and-match moving forward• Video is entering the mobile world

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Are You Ready for IP Videoconferencing?

• Your staff is increasingly dispersed.• You find value in visual meetings with

partners, customers.• You have converged your network

infrastructure to IP, QOS is in place, and you’re already running voice over IP.

• You already use ISDN videoconferencing on a limited basis.

• Staff is asking for desktop videoconferencing

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Recommendations

• Like voice, it is inevitable that room-based video will move to IP

• Determine ROI for desktop video conferencing

• Plan for extending video beyond enterprise boundaries

• Integrate communications & collaboration planning

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Thank You

Irwin LazarIrwin.lazar@nemertes.com703-468-4361IM (AIM, Yahoo, Skype, Google): imlazarSightSpeed: irwin.lazar@nemertes.com

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Introductions• About Nemertes

– Founded October 2002– Research data comes from

network of 2,500 IT executives willing to discuss their issues and concerns at length

– Focused on analyzing the business value of emerging technologies