* Seeks market share as key customer Cisco buys rival
* Launches high definition video conference room system
* Product to add $3-5 mln in sales in Q3, Q4, more in 2011
By Tova Cohen
TEL AVIV, April 19 Radvision RVSN.O is
accelerating its move to offering complete video conferencing
systems under its own name as it seeks to expand its market share
following Cisco Systems' (CSCO.O) acquisition of rival Tandberg.
U.S. network equipment maker Cisco accounted for 41 percent
of revenue in 2009 at Israel-based Radvision RSVN.TA, a
developer of video network products.
Cisco on Monday completed an offer for Norway's Tandberg
[TAA.OL], the world's top video conferencing equipment maker.
Radvision has traditionally invented technology and systems
that were primarily sold under the name of companies such as
Cisco, Sony and LifeSize, which was bought by Logitech
"Now is the time for us to start selling our brand name. The
opportunity is here and it's up to us to exercise it," Radvision
Chief Executive Boaz Raviv told Reuters in an interview.
"There is consolidation in this market and because of this
customers are left with fewer and fewer options from whom to buy
end-to-end video conferencing solutions."
Radvision on Monday launched a high-definition video
conferencing room system, its second endpoint product and the
first based on its acquisition in February of Aethra technology.
The system delivers two full high-definition video streams
that can run over the Internet. The basic product costs $7,400,
less than half that of similar products offered by competitors,
Radvision officials said.
Chief Financial Officer Adi Sfadia said Radvision expects to
ship the system towards the end of the second quarter with sales
of the product reaching $3-$5 million in each of the following
"We expect to see significant growth in 2011. We expect the
acquisition will be accretive in the second half of 2010," he
Radvision had sales of $81 million in 2009.
Customers need an alternative to Cisco-Tandberg and Polycom
PLCM.O offerings, said Moshe Machline, vice president of
"Before this we sold the engine under the hood, we were a
pure infrastructure company. From 2009 we realised we wanted to
move up the food chain and offer a complete solution," he said.
Cisco will incorporate Tandberg infrastructure into its
product lines and Radvision will see its revenue decline, though
Raviv estimated it will retain 30-40 percent of its Cisco sales.
Radvision has been seeking new ways to boost revenue,
launching last month a free application for mobile devices to
manage video conferences.
Radvision shares closed at $6.64 on Nasdaq on Friday, down
from a year high of $9.61 in September prior to the Cisco deal.
Tandberg and Polycom control three quarters of the video
conferencing products market, which is worth around $2 billion
and is growing by about 17 percent a year.
Machline said incidents such as the volcano eruption in
Iceland that has paralysed European air traffic will serve to
further fuel demand for video conferencing systems.
"Up till now we played only in a quarter of the market,
which is infrastructure. Now we are going to play in the entire
market," Sfadia said. "Even if we only take 10 percent we are
talking about a few hundred million dollars."
(Editing by Michael Shields)