Oct 8 Polycom, which competes with
Cisco in videoconferencing, hopes to move ahead of the
pack with its new cloud-based product in a market it says will
be worth $12 billion by 2015.
Videoconferencing is on the brink of widespread adoption as
technology moves from expensive and complex boardroom products
to technology that allows video communication on desktops,
smartphones and tablets, and vendors are scrambling for their
piece of the pie.
"Video is becoming more and more mission-critical, but it
has not been taken up massively because of interoperability
issues and inconsistent user experiences," said Sudhakar
Ramakrishna, president of Products and Services at Polycom.
Polycom said on Monday that its RealPresence CloudAXIS Suite
addresses those problems because it will let customers add
anyone on Skype, Facebook, Google Talk and other
business video applications to their video conferences from a
browser via a hyperlink.
The product will be available to service providers and large
businesses by the end of the first quarter, but Polycom will be
running limited trial runs in the current quarter, the company
Polycom has been at pains to fend off larger rival Cisco,
which dominates the videoconferencing market with its
Telepresence virtual conference rooms, and competitors that
offer free technology such as Microsoft's Skype, Google
and Apple's face time.
The success of the cloud-based product is vital to Polycom,
which still generates most of its revenue from hardware-based
systems as it shifts to a software-based model while rivals
muscle in on its turf.
That transition is expected to impact earnings over the next
12 to 18 months, analysts have said.
At the same time, rivals such as privately held companies
Blue Jeans Networks, Vidyo and Avaya as well as business
software maker Citrix are making inroads with their own
However, Forrester Research analyst Philipp Karcher said
Polycom's product was impressive even if it was not the game
changer Polycom claimed it is.
"It is an evolution," Karcher said, adding that there was a
lot of interest in browser-based video conferencing but that
Cisco "is also moving very aggressively into the web browser
paradigm with WebEx and WebEx."
Polycom's announcement may also be a preemptive move to make
itself more independent of Microsoft, which is a key user of
Polycom products in its Lync corporate video, email and
It is still unclear how Microsoft will incorporate Skype,
but Polycom has acknowledged in its annual report the risk that
its products could be replaced by Skype.
Mizuho Securities analyst Joanna Makris has said an
integration of Skype into Lync would mean "game over" for
Polycom's Ramakrishna said the product announcement did not
change the company's relationship with Microsoft, which was "a
key strategic partner."