Recession-Proof Your Technology Lineup with VideoconferencingBy Jessica Davis | Posted 2008-11-12 Email Print
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Video conferencing technology can offer a nice hedge for IT solution providers looking for recession-proof products in a down economy. Customers like video conferencing because it can cut down on travel costs, says vendor Tandberg. Other video conferencing vendors include Cisco Systems, Polycom and LifeSize Communications.
While sales of videoconferencing technology, like everything else, have been
affected by the down economy in 2008, videoconferencing still remains a strong
play for IT solution providers looking for recession-proof products and
technologies to carry themselves and their customers through tough times.
A case in point is videoconferencing vendor Tandberg, a 100 percent channel company based in New York and Oslo, Norway. Tandberg's sales took off in 2006, growing about 50 percent year over year, according to Paul Cantwell, vice president of channels at Tandberg.
Sales have slowed in 2008, growing by only 24 percent over the last 12 months—although a 24 percent growth rate is one that most companies would covet in this year of economic uncertainty and declines.
In its fiscal third quarter, Tandberg reported revenues of $210.3 million compared with $192.9 million for the same period a year ago.
Cantwell attributes the growth rate to a greater acceptance of
videoconferencing in the enterprise over the past few years.
"One of the reasons is the cost of travel," Cantwell says. "And there's also the time and hassle associated with travel. Companies may have initially installed these systems to reduce travel costs, but what they are also finding is that once employees start using them, decisions are made faster. They can still have face-to-face interaction over video." And they can have an ad hoc meeting to make those decisions instead of scheduling a trip for two weeks later.
And while high-end video teleconferencing—the high-definition, immersive experience also known as telepresence—makes up an important part of the market, there are less expensive solutions available too, such as conference room systems and desktop-enabled video teleconferencing.
These days Tandberg is seeing a greater interest from customers in getting their video teleconferencing systems to interoperate with those of other companies or partners.
And another area of interest for partners? Leasing, or financing the solution for end customers that may not have access to the capital for an outright purchase. Cantwell estimates that interest in leasing has jumped about 50 percent recently. Tandberg offers a captive finance arm to help partners put together a deal that works for their end customers.
"We are seeing a tremendous amount of interest in leasing as an alternative option," says Cantwell.