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Videoconferencing: A Market That’s Exploding

After years of stellar growth, videoconferencing has moved way beyond the early-adopter phase, when the technology was new and expensive, and only big companies had the money and expertise to embrace it.

Now, products are mature and prices are low relative to what they were a few years back—enabling SMBs to afford slick videoconferencing systems. And, slick they certainly are. Think high-definition quality, telepresence, big-screen flatscreen TVs and the capability to expand into full-blown unified communications (UC) systems.

Videoconferencing is on an upswing because more companies are looking at ways to increase their quality of communication in workforces that are very distributed, says Chris Pupillo, sales engineering manager, Netarx, a VAR in Auburn Hills, Michigan.

“After 36 to 48 months of fairly slow sales due to the recession, things are picking up,” adds Pupillo. “Videoconferencing is one of those solutions that is selling quite well as it offers companies a good ROI, clear benefits and real cost savings.”

The worldwide market for videoconferencing totaled $1.1 billion in Q1 2010, an increase of 32 percent over the same period in 2009, according to Synergy Research Group. Synergy’s report forecasts the market will approach $2.5 billion this year.

Another report from last year stated that the global UC market for products and services will grow by 50 percent to $30 billion by 2013. The report, by Wainhouse Research anticipates that UC services revenues, which are far smaller than product revenues today, will eclipse those of traditional conferencing services by 2013 or 2014. 

Videoconferencing, an Affordable and Innovative Alternative to Traveling

“Limited travel budgets have compelled companies big and small to find inexpensive and innovative ways to communicate and collaborate,” says Jeff Salanco, manager of Product Marketing, Unified Communications Special Business Unit (SBU), Tech Data.

“Videoconferencing is proving to be a viable solution for companies eager to cut their travel expenditures, while they improve the quality of inter-office and customer communications,” says Salanco.

In addition, companies are looking at videoconferencing as a way to improve the work-life balance of their key executives and sales people. These frequent travelers face numerous issues, such as suffering repeated jet lag, missing a child’s recital or sporting event and playing catch-up on their job duties every time they fly.

“While videoconferencing is largely a horizontal market, strong vertical plays exist, chiefly distance learning, legal and healthcare,” says Tech Data’s Senior Systems Engineer Frank Bolanger.

Demand for videoconferencing is coming from two different kinds of buyers: companies that simply want a standalone solution and those that want videoconferencing to be part of a converged UC system.

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Many SMBs understand and can afford videoconferencing

SMBs ‘get’ the benefits of the technology—reduced travel costs, and better collaboration between employees, customers and consultants. Bottom line: SMBs can afford to buy relatively low-cost solutions from such vendors as Avaya and LifeSize.

Implementing a videoconferencing solution can be a great opportunity to do a network readiness assessment
Implementing a videoconferencing solution is typically as simple as downloading some software, placing units in different rooms and plugging them into the network. However, the implementation task can be a great time for a VAR to suggest doing a network readiness assessment. Such an assessment can drive sales of network upgrades, security improvements and even wireless deployments.

IP-based videoconferencing products are easy to sell and give VARs opportunities to sell full-blown UC solutions
Selling IP-based videoconferencing solutions is a great foot-in-the-door opportunity to up-sell and cross-sell other IP-based UC products such as VoIP, collaboration and presence.

IP delivers the benefits of a single interface, a single infrastructure, easy network management and low cost of ownership. As there are many products under the UC umbrella and as they all require a degree of integration, VARs have almost limitless opportunities to mix and match solutions.

Plus, VARs can sell various add-on services such as network assessment, implementation, managed services and routine maintenance.

Don’t forget to SIP it up
There’s a lot of sales and support activity around Session Initiation Protocol (SIP) trunking. SIP is a signaling protocol that controls multimedia communication sessions over IP. For SMBs wanting to maximize their installed IP-PBXs, a SIP trunk is the smart way to go as it enables them to communicate over IP within the company and to connect to the outside world via PSTN (Public Switched Telephone Network).

Managed videoconferencing services can be lucrative
For many VARs, managed services are often the main way they make their best margins. The videoconferencing space is no exception.

VARs can use a managed service to handle a customer’s existing video network resources such as media gateway controllers, bridges and endpoints. Later, VARs can incorporate into the service such video conferencing equipment as projectors, plasma screens, whiteboards and speakers.

Managed services are a win-win for SMBs and VARs. Most SMBs lack the internal IT experience they need to handle the various technologies they use. Managed services address those needs at low monthly fees. For VARs, managed services provide fixed, recurring fees for services that minimally involve their staff and resources.

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VARs Can Provide Plenty of Value-Added Expertise

Regardless of the type of solution they want, SMBs turn to VARs for help.

“VARs add value with their knowledge of both collaboration and communications platforms, and their ability to optimize an implementation for a specific customer’s need and network,” says Chris Russell, senior product sales champion, Tech Data. “Plus, VARs can get the best purchasing deals on hardware and software.”

For the most complex projects, such as those that involve integration with other UC technologies, most SMBs really need the networking and telecom experience of VARs, Russell adds.

Leverage Tech Data’s UC Expertise

Through its UC SBU, Tech Data provides comprehensive, end-to-end solutions from the world leaders in unified communications, including videoconferencing. Tech Data is the only distributor to carry the UC products of Avaya, Cisco, IBM and Microsoft, all identified as UC leaders by Gartner Research. Plus, Tech Data carries innovative videoconferencing solutions from LifeSize.

“Videoconferencing, whether as a standalone or integrated UC solution, presents fantastic opportunities for resellers serving the SMB market,” says Tech Data’s Vice President of Advanced Infrastructure Solutions (AIS) Chuck Bartlett.

“At its most basic level, videoconferencing enables resellers to sell SMBs a technology with an amazing ROI,” he says. “But, beyond that, resellers can sell their customers a host of IP-based UC tools, covering the gamut of VoIP, collaboration, video and presence.”

The UC SBU is built on Tech Data’s many years of experience supporting IP telephony solutions in the channel. The unit encompasses a broad array of products, including Private Branch Exchange (PBX) and IP PBX switches, SIP trunking, IP Fax and hosted PBX solutions; high-definition video conferencing; peer-to-peer collaboration suites; and on-premise software and managed services to deliver fully integrated communications.

As with all Tech Data SBUs, this unit provides resellers with access to dedicated sales, technical, marketing and product management resources, as well as specialized solutions offerings, services and support for their respective solutions. Tech Data has experienced support resources to help VARs through each step of the HD videoconferencing deal. Whether it’s a confirmation of product specifications, a review of solution designs or guidance through a special pricing process, Tech Data’s dedicated product sales specialists are available to help you close the deal.

To learn more about Tech Data’s extensive videoconferencing product portfolio, contact

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