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Meeting on the tube.

More companies find that videoconferencing is no longer a novelty. Technology is mature, quality good and equipment affordable.

Studies of verbal and nonverbal communication have found that 55 percent of effective communication occurs with visual, as in face-to-face, meetings. Another 38 percent comes from verbal intonations, and 7 percent stems from the content of the message itself.

Perhaps that is why companies of all sizes, seeking to maintain the effectiveness of face-to-face meetings, are seriously looking into videoconferencing as an alternative to business trips.

The concept of combining video with telephones is not new. At the 1964 World's Fair in New York, AT&T displayed its Picturephone, but manufacturing such a product for widespread use just wasn't practical at that time. "The technology needed to support it was incredibly expensive and incredibly complex," says Chris Pitts of MCI Telecommunications. "It was no more than a novelty."

Not anymore. Developments in the past few years have allowed videoconferencing to enter the mainstream as a valuable business tool. Pitts explains there are five major market drivers that have brought videoconferencing to the forefront. Most important is general market acceptance.

"Decision makers are kids of the TV generation," he says. "Even 10 years ago, a CEO of a company wouldn't accept that--it's not a novelty anymore."

Other market influences include competitive pressures, development of inexpensive microprocessor chips, improved transmission capabilities and established international standards.

According to Gary Segreto of GTE in Carmel, a company in the past could only communicate with another company if both were using the same brand of equipment. But in the past couple years, the Consultative Committee on International Telephone and Telegraphy came out with standards allowing different units to interface with each other.

International events have boosted the usage of videoconferencing as well. Says Nathan Harrell, manager of national sales at Sprint, some American companies during the Persian Gulf War prohibited travel internationally, and even domestically. Videoconference business increased 300 to 400 percent immediately. "We thought there would be a decline after things returned to normal," Harrell continues. "But some customers found it to be a useful communications tool and kept using it."

Segreto of GTE adds, "The technology is just now mature to the point that the quality is good and the equipment costs are affordable." The cost of a video-dedicated room used to be several hundred thousand dollars. Now the cost is lower and the quality is better.

Transmission costs used to be prohibitive as well: A video call from New York City to Los Angeles used to cost about $2,000 per hour. "It's not too difficult to see that it wasn't more than an executive play-toy," Harrell says. Now, that same video call could cost as little as $14 per hour.

Changes in the way video signals are transmitted have helped cut the costs. It used to be that all of the information on the screen was sent dot by dot, says Jim Murphy, product manager at United Telephone. "Now, it transmits only the information that has changed from frame to frame."

Before fiber optics entered the picture in the late 1980s, video signals were beamed from company to company with the help of satellites. But there were a few problems with this method, Sprint's Harrell says. Because the signals had to travel into space and back, there was a time lapse between a question and an answer, a comment and a response. "It really was uncomfortable," Harrell says, especially when a joke was told and the laugh was delayed.

Also, "rain fade" could sometimes knock the transmission off, causing problems. Then, there was the security issue. With the proper equipment, anybody could pick a videoconference signal from the satellite and listen in on meetings.

But now, with fiber optics, hundreds of meetings could be taking place and be transmitting over the same fiber cable. And everything is in real time, not delayed, making the whole process more like being there.

Other technology has added to the "just-like-being-there" atmosphere. Audio has improved, and a single microphone can pick up anyone in a typical room without any echo. Participants can move around the room just as they could in a traditional face-to-face meeting.

Besides the visual appeal of videoconferencing, cost savings are the advantage considered the most often. Depending on current prices, the average, two-day business trip could cost $1,200 to $1,400, including plane tickets, hotel accommodations, car rental and food. If companies could save one business trip a month with a meeting over the wires, Pitts says, that would quickly cover the cost of the equipment.

Debra Arrington of Cable & Wireless in Virginia says soft costs such as time and manpower need to be considered as well. Meetings that could take an employee out of the office for days could very easily be taken care of in the office in two hours, and "that's very easily translated into hard dollars and that's where the issue of productivity comes in," she says.

"The trend seems to be to use dial-up services," Segreto says. He adds that with dial-up service, you pay for what you use and you can dial up any system throughout the country or the world--just like a telephone call.

Pitts identifies four types of videoconferencing units. The first is the custom room. This room is designed for major image productions. All sound, lights and visuals are controlled and an extra person is needed to control the multiple monitors. Depending on how sophisticated the setup is, this type of unit can cost anywhere from $150,000 to $1 million.

Next is the stand alone. This unit is still permanent, but the equipment consists of a monitor, some speakers and a control panel. "With some training, anyone could manipulate it," Pitts says. Prices for this setup range from $50,000 to $100,000.

Though it doesn't have the feature functionality that the other two models have, the roll-about unit is gaining in popularity and can be a starter model for some companies. A 20-inch TV, a camera and an equipment rack are on a cart that can be rolled to a meeting and plugged into a phone jack with video capabilities. These portable models cost less than $20,000.

Compression Labs in California has two models ready to roll into offices around the country. This videoconference-to-go is as easy to use as a VCR and requires no formal training--or even a manual, says Ken Hollen, the company's director of marketing. The Eclipse 8050 ($14,900) and the Eclipse 8100 ($19,900) are complete videoconferencing packages that come completely assembled and simply need to be plugged into a power supply and a video-capable phone network line. A hand-held remote control allows users to speed-dial a location, adjust the camera angle and increase the audio volume. Easy-to-use menus and icons make this system simple to use.

Because of the low price, Hollen says, videoconferencing will be open to more than just large companies. "There's a whole new set of organizations that are going to implement videoconferencing, including small advertising agencies, small law firms, small management recruiting firms, high schools--a whole variety of organizations who really couldn't afford it before."
COPYRIGHT 1993 Curtis Magazine Group, Inc.
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

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Title Annotation:trend among companies to use videoconferencing technology
Author:Gilbert, Jo
Publication:Indiana Business Magazine
Date:May 1, 1993
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