Face to Face Without Ever Leaving the Office Internet Telephony Expo 2003 Craig Colin Director Strategic Accounts Tel:

Agenda  Who’s doing video conferencing and collaboration today?  What are we seeing out there?  What’s the business case to support video conferencing  Technology - why IP makes the story complete

Who’s using it ?  Healthcare  Financial  Engineering/Mfg  Legal/Judicial Education

What are they doing with it ?  Healthcare  Remote specialists  Medical education  Video “house calls”  Financial  Investor relations  Conference calls  Video tellers, brokers...  Engineering/Mfg  Workgroup collaboration  Process control  Customer support  Legal/Judicial  Contract negotiations  Video arrangement  Prisoner consultation Education Distance learning Tutoring, mentoring Remote experts At home schooling

Business Case?

Positioning Videoconferencing – What’s the problem?  Travel expenses – executives, sales, marketing, field support, ect.  Product development timeframes  Team building with geographically dispersed workforce  Employment recruiting  Customer relations

Business Case Elements  Costs  Network and infrastructure  Reoccurring  Hard  Soft  Benefits  Real  Intangible  ROI

Video Conferencing Cost Structure  Set up costs (some may be capitalized)  Purchase of equipment  Network upgrades and design  Installation of equipment and network  Training of people  Scheduling, reservations, mgmt software  Fixed monthly costs  Network access  System mgmt and maintenance labor and fees  Variable monthly costs  Network access charges

Real Benefits - $$$  Eliminates airfare and hotel bills  Eliminates taxis, food, beverage expenses, etc  Eliminates entertainment costs

Intangible Benefits  Accelerates decision making  Increases interaction and productivity of dispersed teams  Allows closer relationships with clients, prospects, and suppliers  More flexible training  Travel reduction reduces employee:  Wear and tear  Stress levels  Family issues  Down-time

ROI – Travel Example General Cost DataVideo Cost Data # of travelers10# of video systems11 Average cost/trip ($)$1,200Initial cost$200,000* # of meetings/month4Annual maintenance10% Meeting length (hrs)2 Management cost/month ($) $7,000 Round trip travel time (hrs)7Network costs/month ($)$1000/system Logistic time (hrs)0.5 % of meetings done by video 40% Travel to/from airport time (hrs)2 Average annual wage ($)$100,000 Burdened cost (%)33% * Includes MCU, gatekeeper and network upgrade. Source: Wainhouse Research

ROI-How does it look on a graph? Breakeven occurs at month 12! Breakeven point Source: Wainhouse Research

Why IP Makes the Picture Complete  Wider network availability  More favorable economics  Better end-user experience  New compelling applications

Transition From ISDN to IP  Lower operating costs  Fixed monthly charges  Higher video quality  Higher call reliability  Converged applications  Innovative service provider offerings  NAT issues  Firewall issues  QoS in the wide area  Bandwidth in the local loop  Integrity of mission critical data network DriversInhibitors

Better End-user Experience…..  Less call latency!!  Higher call completion rates  Accepted call completion rates over ISDN - ~85%  Call completion rates over IP can exceed 99% on a well designed network  Faster connect times  No need to bond ISDN-lines over IP  Better quality video  Over IP, users can take advantage of available bandwidth to achieve broadcast quality video

New Compelling Applications  This is what will ultimately drive the market  Early stages – but the possibilities are exciting  Central theme – adding video as a feature to other products and services  Some examples  High-quality PC-based endpoints  Integration with IP-PBXs  Integration with PC-based IM  Integration with audio and web conferencing services  Video conferencing over 3G cellular networks

Separate Networks.. Separate Devices VOICE DATA VIDEO

Converged Communications - Voice, Video, and Data VIDEO Voice, Video and Data-Enabled 3G PDA DoCoMo Video 3G Cell Phone Cisco SIP-Based Voice/Video Phone MS Windows Messenger Merges Voice, Video and Data PCs Become Integrated Voice, Video, Data, and Web Portals IP-Based Video End Point Now Features Robust Voice and Data Functionality DATAVOICEVIDEO

One Example …

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