Managed Telepresence Worth $360M in Revenue

”High definition” or “hot dang”? What HD actually stands for could be questioned if ABI Research is correct in its prediction that global managed telepresence services will exceed $360 million in revenue by 2011.

The firm characterizes telepresence, which is the immersive video conferencing service that allows participants to feel like they’re in the same room together, as “rapidly growing.” But on-premise systems are also prohibitively expensive, leading to a trend toward telepresence being offered as a managed service.

“The growth of managed telepresence services raises the prospect that soon virtually anybody, from multinational corporations to private individuals, may be able to benefit from this remarkable audiovisual experience,” said ABI Research Vice President Stan Schatt, in a research note. “The price for telepresence managed services will eventually come down to where any mid-level manager can do it.”

There will also be public facilities, often in hotels or conference centers, where one can use telepresence for a fee. “That’s going to be very attractive to small businesses,” said Schatt. “Take a small business that has a supply chain relationship with an Asian company. The fee for an hour in a telepresence room is always going to be less than the cost of sending a key executive all the way to China. And fewer air miles are better for the environment.”

Many telepresence systems today are still not easily interoperable: another reason to let a service provider handle the technicalities. “We’re already seeing AT&T, BT, and Nortel being very active in this area,” said Schatt, “and India’s Tata Communications has started offering telepresence facilities in partnership with Cisco.”

And ultimately, ABI noted, telepresence is more useful than phones, e-mail or ordinary videoconferencing. The key is the realism: “In complex business negotiations, body language, eye contact and vocal realism are still critical,” wrote Schatt. “And for individuals communicating with distant loved ones, there’s no substitute.”

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