Cisco unveils telepresence push

Cisco has unveiled a new telepresence product that it hopes will create a billion dollar market.

The product deploys three large-screen televisions with a resolution of 1080 vertical lines. It requires a high speed network connection of 10 megabits per second.

Telepresence is essentially videoconferencing on steroids, using high definition (HD) streaming video on large-screen televisions. Existing videoconferencing solutions are generally believed to lack the clarity and screen resolution to enable true interactivity between participants.

"The first question customers ask is: 'Is this just video conferencing with HD?' That really isn't what it is. It really is about delivering virtual meetings," said David Willis, a research vice president covering telecommunications with Gartner.

The Cisco technology is easy to set up and use and allows participants to view printed documents and share slides.

"Telepresence can do for business networking what Myspace and the other social networking sites is doing for social networking," said Marthin De Beer, general manager of emerging markets for Cisco.

"It will create new relationships with people you may have never met before and enable you to do business in a much broader circle than what you are able to do today."

Cisco's telepresence product is based on industry standards, which in theory should allow other parties to create comparable products that communicate with Cisco's. It uses the industry standard h.264 video codec as well as the Session Initiation Protocol, a standard that routes internet communications to the appropriate device, said De Beer.

Users connect to different locations by dialing a phone number on a standard VoIP phone.

De Beer touted the product as "the first telepresence product" on the market today. Other vendors currently offer telepresence services that require steep monthly service fees and only offer screen resolutions of 720 vertical lines.

HP, for instance, last year unveiled its Halo Collaboration Studio. The product costs about $550,000 per room as well as $18,000 per month in network and service fees.

Cisco is scheduled to start shipping the three screen model by December at a list price of $299,000. Customers should expect to pay about $260,000 after rebates on the hardware, set-up and installation fees, said De Beers.

A single screen is slated for release by December and has a list price of $79,000.

Cisco chief executive John Chambers first spoke about Cisco's interest in telepresence at the Networkers conference last summer. At the time he indicated that the company was considering declaring telepresence an "advanced technology ", but the company has now become more conservative in its projections.

De Beer instead referred to telepresence as an "emerging technology".

"An advanced technology means that we are absolutely confident that this will be a billion dollar business," he said. "We're not quite sure how big this market is going to be just now because it's so new.

Gartner's Willis, however, doubts that telepresence will open up big markets.

"This is not going to be a billion dollar market for anyone. There will be limited shipments because it is so expensive."

He estimates that HP has sold about 50 of its Halo studios. Equally, he expects the market for Cisco's technology to focus on convention centres and hotels.

Willis also claimed that Cisco is using the technology to kick start the corporate online video market and grow the overall network usage. This in turn will allow Cisco to strengthen its core business of selling routers and switches.

"Nothing fills networks like video does."

• A video interview with De Beer and demonstration of the Telepresence technology is available on the Silicon Valley Sleuth blog.

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