Telepresence gets real

Telepresence suites were heralded as the future of video conferencing when they emerged on the scene in 2006. With large high-definition (HD) plasma screens, top-quality audio and suites dedicated solely to video conferencing, “telepresence” made people feel as though they were face to face, which proponents said would encourage businesses to use technology more often and travel less. The savings from eliminating travel would more than make up for the additional energy and expense required to install and run giant plasma screens and high-definition conference rooms, or so the thinking went.

Though the idea has been slow to catch on, predominantly due to the astronomical cost of the suites—from $200,000 to $350,000, plus $20,000 per month in support fees—analysts are predicting an uptick in sales of telepresence products in 2008 as technology providers including Cisco (Nasdaq: CSCO), Hewlett Packard (NYSE: HPQ), Tandberg, Teliris and Polycom (Nasdaq: PLCM) partner with hotels, service providers and distributors to develop creative partnerships and release smaller, less pricey models.

HP announced a partnership with Marriott Hotels (NYSE: MAR) in March 2008 to provide its Halo telepresence technology at hotels around the world by the end of the year. HP also announced the release of a smaller version of Halo, which is designed for two to four people and will cost roughly $120,000. San Jose–based Cisco announced a deal in 2007 with business-center operator Regus to roll out its telepresence suites at 50 locations worldwide in 2008 and announced in March 2008 a distribution deal with India-based Tata Communications to sell, install and maintain its systems throughout Asia.

Before former Cisco chief development officer Charlie Giancarlo stepped down in December 2007, he announced the release of a consumer high-definition video conferencing system with a $1,000 price tag. But the company has not commented on the system since.

Tandberg has gone an alternate route, partnering with Nortel to provide telepresence services rather than equipment. Tandberg also announced in March 2008 a partnership with Microsoft (Nasdaq: MSFT) to produce a $300
high-definition camera that would “bring high-definition video conferencing to the masses.”

Newcomers to the telepresence game—Quanta Computer, a laptop computer manufacturer, and OoVoo, a video chat software company—have teamed up on a system that allows consumers to connect HDTVs to the Internet for video conferencing.