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Electronic Engineering Times special edition on emerging markets Desktop Video Is
Making Its Move By Toni McConnel Each year for the last several years, market forecasters have been saying that this would be the year the desktop videoconferencing market would take off. Yet every year, the market has not performed up to expectations, so that such predictions have now taken on a cry-wolf taint. But according to a new report from market research firm Forward Concepts (Tempe, Ariz.), this time it's different. The report, titled "Teleconferencing Markets and Strategies: From Novelty to Necessity," predicts that by 2001, the videoconferencing market will reach $5 billion, with by far the greatest growth in the desktop segment-from about $300 million in 1996 to $3 billion in 2001. Forward Concepts' optimism is based on the fact that 1996 saw a convergence of solutions in several technologies that had not quite managed to meet the mark in prior years. Further solutions will emerge in 1997. It is likely that by the end of 1997, all new desktop computers will be shipped videoconferencing-enabled; all the consumer will need to add is a digital video camera. In terms of PC connectivity, Universal Serial Bus (USB)-oriented devices will be shipping with some Pentium- and Pentium Pro-based computers now and the bus will be incorporated into many more by the end of the year. Videoconferencing cameras have made great strides toward enabling low-cost conferencing. Only a little more than two years ago, it could cost as much as $1,200 just to add one to a PC-$500 or $600 for an analog video camera and another $500 or $600 for an add-in A/D converter board. Today, a color digital video camera for a desktop system, such as the Color QuickCam from Connectix (San Mateo, Calif.), runs about $200, with no add-in board needed-the camera has its own on-board video-codec and image-capture boards. Prices for desktop digital video cameras are expected to drop to as low as $50 as the market becomes more competitive. Fully H.323-compliant videoconferencing capabilities are already being embedded in the most popular Web browsers. With a minimum investment in hardware-in some cases no more than a sound card, a microphone and speakers-one-way videoconferencing is enabled over the Web. For example, Intel's Internet Video Phone software allows a video receive-only mode-only one of the participants needs a camera. When that receiver-only consumer buys his or her next computer, it will be videoconferencing-enabled out of the box. It isn't that much of a leap to invest another $100 to $200 for a camera. And by the end of 1997, the cost may be even lower, say industry watchers. Emerging set-top boxes that provide for Internet access and a new generation of video phones, both of which are standalone appliances that use the TV set as a display, represent a relatively new videoconferencing market segment. Forward Concepts expects this market to grow from almost nil in 1996 to over $600 million by 2001. Crucial compatibility issues remain in multipoint conferencing. Although a variety of solutions are provided with videoconferencing equipment and software, complexity increases as the number of endpoints increase. Fox example, you may have one person on a LAN using ISDN, another in a different location with a videoconferencing workstation using phone-company DSL (digital subscriber line), a person working at home with a 28.8 modem over POTS (plain old telephone service), and another with no videoconferencing equipment at all, joined only by telephone. The situation may be further complicated by connections through a variety of phone companies whose switching technologies differ. The problem of resolving speed and standards issues for widely separated locations is stimulating the market for bridges, gateways and what VideoServer Inc. calls "multipoint conference servers." Although such solutions are most generally of interest to the group teleconferencing market, they are also relevant to the growing number of people who telecommute or run their own businesses from home, since they are often involved in teleconferencing with larger businesses. Forward Concepts predicts this market will grow from $100 million in 1996 to more than $700 million in 2001. The means by which videoconferencing will reach homes is as disparate as the number of technologies that are claimed to be enablers. The question of whether telcos will go with ISDN or DSL to provide high bandwidth to SOHO-small office/home office-subscribers seems to be resolving itself in favor of DSL, mainly because of the limited tariffs allowed for ISDN. Speeds over DSL can reach 8 Mbits/second. Telco DSL service is already available in some major urban areas. Since telcos are notoriously slow to deploy new technologies, just when DSL will be generally available remains an open question. Meanwhile, cable-modem service is already available in about 100 locations in the United States. Larry Douglas, general manager of Cablevision of Flagstaff (Flagstaff, Ariz.), stated that a large percentage of cable companies, even very small ones, are investing in new fiber-optic lines to the curb, as they prepare to offer high-quality cable-modem service including videoconferencing possibilities. Douglas added, "Cable TV is facing increasing competition from satellite services. To survive, we have to expand our services and cable modem allows us to offer videoconferencing with applications ranging from real-time consultation services of all kinds-such as banking and real estate-to education, home shopping and personal communications." For its part, in early March, AT&T announced its plans to invade the local telephone service market with a wireless technology it expects to start deploying in about two years. The system will use a 10-MHz radio spectrum to provide Internet access at 128 kbits/s, connecting a home (or small office) phone to an AT&T digital switching center via a transceiver mounted on the building and a neighborhood antenna. Andrew W. Davis, research consultant for Forward Concepts (Tempe, Ariz.) said he bets his nickel on cable modems, mainly because of lower access charges-$30 to $60 a month compared with $75 to $150 for telco asymmetric DSL. That could change, however, if telcos lower their prices to be competitive. 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