Videoconferencing competitors Intel and PictureTel last week announced a joint distribution and product development agreement that they hope will speed the growth of global audio/video collaboration.
The deal helps PictureTel begin to open its popular but proprietary conference-room video systems to PC-based collaboration tools such as application sharing, streaming video, and multicasting. Intel primarily gets PictureTel's expertise in selling conference room systems directly to corporations.
The agreement calls for jointly developing a common hardware platform for release in 2000, according to Scott Darling, general manager of Intel's business communications division. Intel will invest US$30.5 million in PictureTel, and PictureTel will get exclusive rights to market Intel's only conference-room-size product, the TeamStation System. PictureTel will have nonexclusive rights to also sell Intel's ProShare Video System 500, the top-selling desktop videoconferencing package in corporations.
"We're interested in getting this market much larger and growing much faster than it is today," Darling says, citing 1998 market growth of 30 to 35 per cent, while revenues were mostly flat.
Back into the Conference Room?
Research indicates corporations may have a growing preference for centralising their video investments in conference rooms -- still a small fraction of the overall market. This is partly because they've found distributed desktop approaches to be unreliable and an expensive burden on tech support departments. "We're trying to turn the conference room into a collaboration room," Darling says.
"We were going down this (open standards) path anyway," says Gary Bond, group vice president at PictureTel. "Our systems are closed systems. It limits their capability for other uses." Bond said the company will likely eliminate some products from its own PC-based line, which includes products like LiveLAN and Live200.
Elliot Gold, president of market research firm TeleSpan, says the deal is good for videoconferencing because standardised hardware built around Intel CPUs (central processing units) should be cheaper and interoperate better than current room-size systems. It also lets Intel focus on its core business strategy: sowing Pentium-class chips far and wide.
Gold adds that the joint hardware platform will be centred around Intel's upcoming, graphically powerful Pentium III (Katmai) CPU, though Bond would not confirm this.