Beam Me Up, Scottie: Consumer Telepresence May Arrive Sooner Than You Think

Posted by: Peter Burrows on September 26, 2008

I wrote a story this week about high-def corporate videoconferencing and “just like being there” telepresence systems. Turns out interest is picking up,(as we predicted back in early 2007) thanks to more affordable systems from the likes of LifeSize and cost-cutting pressure on corporations to lower travel expenses and be more green. But consumer videoconferencing? After all the excessive hype over the years, few pundits or technology companies even dare to make projections on that score. Even Cisco Systems, self-appointed cheerleader for all networked services, has tread somewhat carefully.

And yet it turns out that Cisco plans to introduce a $1,000 consumer videoconferencing system in coming months, possibly at the Consumer Electronics Show in Las Vegas in January, according to two sources. “We are going to go into the home,” confirms Marthin De Beer, head of Cisco’s emerging technologies unit. That’s a huge jump down from Cisco’s current low-end price of around $40,000 for a corporate telepresence system. The timing isn’t set in stone, as challenges remain — particularly in getting the cost of the HD cameras down to consumer-friendly levels, and getting the system to work without requiring ridiculous amounts of bandwidth.

But whenever Cisco figures out the technology, look for AT&T to aggressively market the service to people who want videoconferencing on their big-screen TV. Ma Bell, which famously demonstrated a PicturePhone at the 1964 World’s Fair in New York, is already working with Cisco to enable corporate Telepresence customers to arrange virtual meetings with other companies that own Telepresence systems (previously, companies could only set up meetings with sites on their own corporate network). But by next year, AT&T will likely offer a videoconferencing channel on its U-Verse consumer broadband offering, says AT&T chief technology officer John Donovan. “It will be a U-Verse offering,” says Donovan. “I think you’ll see it expand in 2009, and see some reasonably substantial take-up in 2010.”

He wouldn’t go into details of how it would work. My guess is there would be a basic videoconferencing service, but also specific services on top of that. Cisco has hinted at plans to deliver videoconferencing-based services aimed at healthcare, education and wealth management (handy for those times when screaming at your broker on the phone just isn’t good enough).

Of course, right now may not be the best time to roll out some super-slick—and super-expensive—new service. Two sources (not De Beer or Donovan) figure AT&T will charge $25 to $50 extra to U-Verse customers to have videoconferencing on their big-screen TVs. That’s likely on top of the upfront cost for the special camera, the high-def audio and other technology. “We think we can get that near that $1,000 price point,” says Donovan. “That’s a lot for most people. But if you’re mother isn’t doing well, it might be worth it to you.”

Then again, many people are already using Skype or Apple’s iChat in such situations. “Consumers’ expectations are that videoconferencing should be free. If I can do it on Skype or on my Mac, why should I pay for it?,” notes IDC analyst Nora Freedman.

Personally, I think there will be a market for paid videoconferencing as the price comes down. And I’m surprised that Cisco, which has been happily charging corporations as much as $340,000 per Telepresence room (which in turn requires those companies to spend three to five times that amount to upgrade the underlying network to handle the traffic), is pushing as quickly as it is to commoditize the technology. I guess De Beer and his colleagues at Cisco really do see an opportunity to make two-way video a part of everyday life—and a truly massive market. “Think of the next-generation social network, where you don’t sit down and type things to people but you sit down and talk with them, instead.”

Sounds reasonable, but be warned: Marthin is as passionate an evangelist for video technology as you’re likely to run into, so it’s possible reality won’t keep up with his vision. For example, he believes that in five to seven years we’ll be able to attend videoconferences holographically. “If you walk behind [the seat the holographic Marthin is sitting in], you’d see the back of my head,” he explains. Here’s a video to get a gander at Cisco’s demo of the technology that could make this possible.

So what about you? Any chance you’ll fork over $1000 to be able to have videoconferences from the comfort of the couch?

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Reader Comments

rolf Bork

September 29, 2008 10:16 AM

"Cisco has hinted at plans to deliver videoconferencing-based services aimed at healthcare"...taking a FULL service approach appears to be the winning strategy as consumers can easily see VALUE delivered. While different locations and different health issues and different personal wealth will make service pricing a challenges one can assume that there will not really be a long term business in selling videocon-equipment that is not bundled with a ehealth service contract.
Might take the same path as high bandwidth DSL routers ...hardware comes "FREE" with service.As the service provider now owns the hardware EASY SYSTEM MANAGEMENT will be key to profitable business. Remote management of DIGITAL HOME is the strategic hurdle for profitable (consumer...any) businesses enabled by low cost videocon technologies.
Rolf Bork, BOD mediaf.com & sensitivetech.com

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BusinessWeek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, Douglas MacMillan, and Spencer Ante dig behind the headlines to analyze what’s really happening throughout the world of technology. One of the first mainstream media tech blogs, Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.

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