August 28, 2007 / 5:04 AM / 12 years ago

HP launches cheaper video conferencing product

NEW YORK, Aug 28 (Reuters) - Hewlett-Packard Co (HPQ.N) launched a cheaper version of its high-end video conferencing product Halo on Tuesday in a bid to grab market share from competitors like Cisco Systems Inc (CSCO.O).

The new product, which like the more expensive Halo unit will enable real-time, high-definition video conferencing over three large-screen displays, will sell for $249,000, compared with $349,000 for one that includes a custom-built conference room with walls and lighting as well as the equipment.

The new version has the same capabilities but involves less construction to the room in which it is housed, HP said.

HP said it has sold Halo to about 20 customers since December 2005, with about 120 rooms now in use. HP does not release dollar figures from those sales.

Ken Crangle, general manager of HP Halo, said the change came because of customer demands for a less expensive but equally high-performing unit. He forecast that HP’s video conferencing sales would double as a result.

“We’re guessing half or more of our sales will come from this,” he said.

Top U.S. network equipment maker Cisco has forecast strong sales of its TelePresence video conferencing product, which was launched last October at $300,000 and is a key competitor to HP’s Halo.

Smaller communications equipment companies such as Polycom Inc. PLCM.O also compete in the market.

Crangle forecast that prices of video conferencing equipment, including Halo, would eventually fall further in line with component prices.

“The components of this are all coming down in price over time. If you look at large displays, they are coming down. Processing prices and bandwidth are all coming down in price,” Crangle said.

The company said it would introduce new security encryption and multimedia capabilities in all Halo products. It also said it would integrate videoconferencing software by Tandberg TAA.OL into its products. (Reporting by Ritsuko Ando)

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