Dataquest Insight: The Telepresence Market in India, 2008

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Dataquest Insight: The Telepresence Market in India, 2008

  1. 1. Dataquest Publication Date: 16 December 2008 ID Number: G00163616 Dataquest Insight: The Telepresence Market in India, 2008 Sanish KB, Rich Costello This research provides an insight on the current state of the telepresence market in India, as well as the role of telepresence solutions in the context of the Indian market. Key Findings • India is considered to be one of the "hot" destinations for deploying telepresence solutions, due to factors such as the globalization of Indian business. Enterprises are in the early stages of adoption and it is estimated that more than 60 telepresence solutions, from various vendors, have been sold in India (among them are those bought elsewhere and deployed in India as part of global deals) to about 14 customers. However, we believe that the majority of them have yet to become operational. • Telepresence solutions are becoming popular with big corporations for several reasons, such as lengthy commutes between the cities, higher air travel costs and the globalization of Indian business. • One further interesting development is that telepresence solutions are now offered in locations with public access, rented by service providers such as Tata Communications through the Taj Group of hotels in selected cities in India and worldwide. They are also offered through the Confederation of Indian Industries (CII) in selected cities in India. • Recommendations • In India, Gartner encourages enterprises to consider using telepresence solutions between offices, remote manufacturing centers or R&D centers in different locations, since the time taken to commute between big cities like Mumbai, Delhi or Bangalore can be several hours. A telepresence solution can help to improve employee productivity and provide time and cost savings, as it can significantly reduce commuting time. • Midsize companies, which might not have large-scale use of telepresence, can leverage the time share telepresence solution available through shared public access. These include CII and Taj Hotel locations in selected cities such as Bangalore, Mumbai, Chennai and some cities outside India, such as New York or London, which are already in operation. • In the current economic downturn, enterprises should consider the use of shared public access telepresence solutions as part of their cost savings plan. However, there are some challenges such as the availability of suitable sites in the right locations and the traveling time between the telepresence location and the user's office. © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication in any form without prior written permission is forbidden. The information contained herein has been obtained from sources believed to be reliable. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although Gartner's research may discuss legal issues related to the information technology business, Gartner does not provide legal advice or services and its research should not be construed or used as such. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The opinions expressed herein are subject to change without notice.
  2. 2. • Telepresence will not be adopted as a solution by every enterprise, due to its high acquisition costs and significant recurring monthly outgoings if a managed or concierge service is taken up. Therefore, those enterprises not considering the purchase of telepresence now should continue with their regular video and Webcam solutions for video communications. Publication Date: 16 December 2008/ID Number: G00163616 Page 2 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
  3. 3. TABLE OF CONTENTS Analysis ............................................................................................................................................. 4 Environment.......................................................................................................................... 4 Telepresence Solutions ........................................................................................................ 4 Background and Context ................................................................................................................... 5 The Impact......................................................................................................................................... 5 Conclusion ......................................................................................................................................... 6 Recommended Reading.................................................................................................................... 6 Publication Date: 16 December 2008/ID Number: G00163616 Page 3 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
  4. 4. ANALYSIS Environment Telepresence solutions in India are generating a high level of interest from the enterprise user market. It is estimated that more than 60 telepresence solutions from various vendors have been sold in India to about 14 customers. However, the majority of telepresence system solutions are either being implemented or pending implementation. Most of the telepresence solutions sold in India are distributed between a few corporate and major enterprises and shared public access installations. There are five telepresence shared public access sites available in India from Tata Communications in four cities — Mumbai, Bangalore (two sites), Chennai and Hyderabad. Some of the OEM vendors providing telepresence solutions are Cisco, Polycom, Tandberg, HP, Teliris and LifeSize Communications. Most of the solutions are bundled with managed services and are provided through partners (for example, Tata communications and Nortel), rather than customers supporting their telepresence solutions in-house. The globalization of Indian business and lengthy, peak-time commuting using poor infrastructure, means that traveling to short meetings in different cities is very difficult and unproductive for executives in most organizations. For example, traveling from Mumbai to Bangalore might take an average of three and a half to five hours, which includes an average, ground transportation time of two hours and an average air travel time of one and a half hours. Note that traveling times will vary between cities, depending on distance and traffic conditions. However, this inconvenience can provide organizations with a good business case for deploying telepresence or other videoconferencing solutions. It is also important for organizations to realize that they must be able to utilize telepresence often enough to justify an investment when deciding whether to purchase a solution. Telepresence Solutions Telepresence solutions are offered to customers in several forms by vendors, such as "immersive," "adaptive" or "lite" offerings. At the high end of the market are immersive telepresence suites, which are tailored environments where the lighting, acoustics, decor and furniture on both sides of the video are strictly controlled (and often identical), giving participants the appearance of being in the same room and sitting at the same table as participants in other locations — thus, the "immersive" description. Most telepresence suites run high definition (HD) video at 720 lines of resolution, while others run HD at 1080 lines of resolution, using multiple screens (two, three or four) that deliver life-size participants. The audio is also in HD and is fully directional. In most cases, immersive telepresence suites are built for customers on an individual basis. Adaptive telepresence solutions are complete from a technology point of view, often using the same hardware as immersive solutions, but are delivered with more limited environmental components, such as furniture, lighting and wall panels. These are designed to adapt to a given conference room to meet an organization's flexibility and cost requirements. Adaptive solutions are often delivered with a managed service, but will at least specify network requirements. Telepresence lite solutions are typically delivered in a component fashion, leaving the user or integrator to select parts of the technology solution themselves and are delivered without any managed service wrap. To understand how these offering are marketed and segmented by various vendors, see "MarketScope for Video Telepresence Solutions, 2008". In July 2008, Tata Communications announced the availability of its first shared public access facility at the Taj Hotels in Mumbai and Bangalore and CII offices in Bangalore and Chennai. Publication Date: 16 December 2008/ID Number: G00163616 Page 4 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
  5. 5. Additionally, in October 2008 it opened additional access facilities in London and Boston. Tata is expected to make more facilities available globally by the end of 2009. The interesting part of shared public access offerings is that they are available on a "per hour" basis at about $500 per hour. This enables even midsize companies to make use of telepresence without the huge investment. Conferencing from shared public access facilities in India is currently available from Tata Communications, which includes selected telepresence facilities offered to its clients. Tata's rental prices ($500 per hour) are comparable with other international providers (for example, Cisco also charges $500 per hour in California), which suggests that pricing for telepresence rental may be less subjected to regional variation, despite (or maybe because) this is an experimental phase. By comparison, the cost of deploying an immersive telepresence suite on a customer's premises in the U.S. can range from about $127,000 to $350,000 or more (list price) per room. Single- screen, immersive solutions can be in the range of $80,000 to $120,000 (list price) per room. Multi-screen adaptive telepresence solutions can range from $80,000 to $200,000 (list price), while telepresence lite solutions start at around $40,000 (list price) for the core components. A telepresence managed services wrap, or concierge service, can add a monthly premium of several thousand dollars to the total cost. BACKGROUND AND CONTEXT Enterprise audio and video conferencing solutions are finding a good market in India and Polycom appears to have the strongest market presence in these segments. With the advancement of HD video conferencing, some vendors have blurred the lines of distinction slightly regarding the definition of a telepresence solution vs. an HD-based solution. Some vendors promote telepresence as a continuum of their HD-based videoconferencing systems. At a basic level, we've defined basic categories of telepresence solutions here (immersive, adaptive and lite) to help end users to understand the distinction between them. The telepresence market in India is in its infancy and all vendors are competing to grab a leading market share. Driven by early success and customer interest in telepresence, vendors must continue to promote its appeal and use beyond executive level, down into the more collaborative segments of end users within organizations. Increased utilization rates are the key to cost justification and customer success with telepresence. So far, telepresence has helped organizations in other global markets achieve daily utilization rates in the 30% to 40% range, which amounts to about three to four hours of daily use, based on a 10-hour business day. This is in comparison with low usage rates (5% to 7%) of traditional video conferencing systems. THE IMPACT Global enterprises with the financial resources are the prime adopters of telepresence solutions, as it provides justification for purchasing solutions, based on return on investment from cost savings on employee travel, as well as supporting their green initiatives. However, we presume more companies in India will adopt telepresence solutions to connect their multiple offices or remote manufacturing plants or R&D centers, even within India, in the future. However, telepresence will not be a solution adopted by every enterprise in India and those that do will use it sparingly in a few key locations to begin with, expanding to secondary locations in a second wave following their initial trial period. It will never supplant all other video conferencing in the company, due to its high acquisition costs, significant recurring monthly costs if a managed or concierge service is taken with the solution and its high bandwidth network requirements. As a Publication Date: 16 December 2008/ID Number: G00163616 Page 5 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
  6. 6. result, some enterprises will make use of shared public access telepresence solutions in addition to their existing audio/video conferencing solutions. The Cisco/Tata partnership in India is a one example of a model that's beginning to gain traction for telepresence vendors in the public room access market. Worldwide, we also see hotels and business centers increasingly interested in installing telepresence suites for guests and customers to use. CONCLUSION In the present environment in India, issues such as long commute times during peak hours, due to a lack of proper infrastructure and companies green initiatives, might add more substance for telepresence adoption in India. Even though multinational companies are prime adopters of telepresence in India, Gartner believes that other big enterprises here might also use other forms of videoconferencing and telepresence for conferencing across multiple offices within the country. RECOMMENDED READING "Managed Videoconferencing Services" "Is Your Network Ready for Telepresence?" "Toolkit Best Practices: Building the Business Case for Telepresence" This document is published in the following Market Insights: Enterprise Communications Applications Worldwide Publication Date: 16 December 2008/ID Number: G00163616 Page 6 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.
  7. 7. REGIONAL HEADQUARTERS Corporate Headquarters 56 Top Gallant Road Stamford, CT 06902-7700 U.S.A. +1 203 964 0096 European Headquarters Tamesis The Glanty Egham Surrey, TW20 9AW UNITED KINGDOM +44 1784 431611 Asia/Pacific Headquarters Gartner Australasia Pty. Ltd. Level 9, 141 Walker Street North Sydney New South Wales 2060 AUSTRALIA +61 2 9459 4600 Japan Headquarters Gartner Japan Ltd. Aobadai Hills, 6F 7-7, Aobadai, 4-chome Meguro-ku, Tokyo 153-0042 JAPAN +81 3 3481 3670 Latin America Headquarters Gartner do Brazil Av. das Nações Unidas, 12551 9° andar—World Trade Center 04578-903—São Paulo SP BRAZIL +55 11 3443 1509 Publication Date: 16 December 2008/ID Number: G00163616 Page 7 of 7 © 2008 Gartner, Inc. and/or its Affiliates. All Rights Reserved.

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