Alf's Articles

Web Conferencing Saves Time, Money

by Alf Nucifora

The promise of online get-togethers has been touted from the very first days of the Internet going main stream. The truth is the technology never took off. Old habits die hard. The initial attempts at web conferencing and online collaboration ran up against the traditional new technology obstacles--not particularly user friendly and a royal pain for the busy executive who had neither the patience nor the skill to deal with a play toy of the techno geeks. Since 9/11, however, things have changed. The difficulty and rising cost inherent in today's business travel coupled with the need to constrain expense as a result of an ever lingering recession, has forced a second look at web conferencing, not just as a means of bypassing the traditional face-to-face meeting, but also as an opportunity to train, demonstrate and inform without the loss of time and dollars associated with gathering bodies in a hotel room or meeting facility.

What's Changed?

Improved technology, the dramatic growth in penetration of high bandwidth via cable modem and DSL connection and the rapidly declining cost of online communication have all helped make web conferencing a viable option for today's small-to-medium sized business. Web conferencing was a half-billion dollar business in 2002 and continues to grow at an annual rate of 30+%. At a broad average price of 50-60 cents per minute, it's now a viable alternative to the face-to-face meeting and a preferred option to the traditional teleconference where one can never see the whites of their eyes.

Web conferencing is nothing more than a productivity tool. In addition to saving money and allowing a company to use its employees' time more effectively, it also improves communication, both internal and external. That's why the sales and marketing people have been its most ardent supporters. They see the technology's value for hard core selling and demoing of the product. Say's David Thompson, Chief Marketing Officer for industry leader, WebEx Communications, "It expands a company's business beyond geographical territory. More importantly, it's a great tool for post-sales support, particularly for customer training." Scott D'Entrement, President and CEO of Netspoke, supports the claim, "One of our major clients is using integrated audio and web conferencing to conduct and archive training sessions while another has realized substantial savings by using web conferencing technology to allow its IT department to conduct technical training online and to work remotely, thereby avoiding the need for increased staffing."

Profiling the Players

As is to be expected, web conferencing providers are flooding the marketplace. I've chosen three to help provide perspective for the average small-to-medium sized buyer-- the industry leader, an up-and-comer and a niche player.

• WebEx Communications (www.webex.com): They're the industry biggy with a 64% share of market, 7,500 customers and over a million online hosts or subscribers. As expected, their customer base is a gallery of the well-known including, Oracle, MasterCard, Motorola, and Microsoft. Their partnership commitments with providers such as SAP, Intuit and AT&T would indicate that WebEx will most likely be to web conferencing what Gillette is to shaving. As with most providers in the field, WebEx does not require companies to install any software of purchase any hardware. Subscriptions (for a small user base) run an industry average of $100 per month for unlimited use. The technology supports a variety of complex media including streamed video, CAD and 3D animation. Data is never stored on the WebEx network; it simply passes through. WebEx now offers a recently- introduced Events Center, targeted primarily at marketers, which permits an online event for anywhere from 20 to 2000 participants, obviously an interesting online platform for press conferences and new product launches.
  
  
• Netspoke (www.netspoke.com): This four year old company, servicing 2,200 customers and 22,000 subscribers, operates on an ASP model and charges its customers either by the minute or on the traditional subscription basis ($125 per user per month). As with its competitors, Netspoke does not require any hardware or software installation and will even run off 56K modems, albeit slowly. The technology is firewall-friendly, which means there is no need to involve the IT department in solving cumbersome access problems. Netspoke's D'Entrement estimates that the average organization uses webcasting for a minimum of an hour a week for meetings and two hours a week for sales-related activity. Say D'Entrement, "Our customers conduct sales and marketing webinars involving group product demonstrations. We also see a lot of small group collaboration, where documents, data, charts, etc., are reviewed." While Netspoke technology will allow up to 1,000 participants to conference together, the average is in the 5-7 participant range.
  
  
• LBC Conferencing (www.lbcconferencing.com): Operating on a Raindance (second largest player after WebEx) platform, LBC caters primarily to the legal and medical communities with an integrated phone and web conferencing product. As with its larger brethren, LBC sells its product by the minute in addition to offering the traditional unlimited use monthly subscriber option. President and CEO, Doug Mondo, boasts of 50,000 conferences a week on the LBC network but also emphasizes the after-the-fact benefit of the technology, "You can record an event and subsequently make it available as a streaming file for education and training purposes. It can even become an e-commerce event for which subscribers pay to view."
  
  

Web conferencing and online collaboration will never replace the face-to-face meeting, but it's an effective way to fill the gaps. Given that most of the leading providers offer tried and proven technology at equivalent price points, the prospective buyer for web conferencing services needs to pursue the fundamentals--a quality product with flawless 24/7 customer service support and so easy to use that even the harried executive can adopt the technology with a minimal learning curve and with an ease and speed that one normally associates with the ATM or e-mail.