Cisco & Verizon Video Chat?

Looks like the rumors of the past 4 months are true:  Cisco and Verizon are teaming up to bring Video Chat to your living room TV.  (They’ve been collaborating for small business video solutions for the past 2 or 3 years. ) According to the SJMerc News this new CE direction is necessary because Cisco can’t sell enough of its high end Telepresence® gear to its business customers.

A New Telco Revenue Source? While I applaud Verizon for looking into new and exciting applications for their subscriber base, I wonder if this is just another video phone pipe dream?  According to Wikipedia, the idea was first conceived in 1878!  And where are all of the AT&T Picturephones® that were going to make telephones obsolete in 1974?  The Nokia N Series phones have had video chat features built in for the past few years, but the feature is inoperable in the US market.

What Will Drive The Consumer Demand? In business the desire to have a virtual face to face meeting makes sense to cut travel expenses.  Having experienced Telepresence® myself, I must admit, Cisco has done a great job to improve the overall experience.  However, the reason Cisco is said to be looking for a new market is because those business customers are not buying.  Can a market be sustained after all of the early adopters buy one (or 2) and the novelty wears thin?

The Telmex Experience: Verizon marketeers may want to visit Telmex and get some first hand data from their video phone launch in 2005.  According to Jos Otero, president of Signals Telecom Consulting:

“If you asked me if this new service [for Telmex] is going to be good in terms of marketing and positioning… I’d say yes. But if you asked me is it going to have a huge positive impact on operator revenues, I’d say no.”

Key to Success? Significant advances have been made in the availability of bandwidth and the acceptance of worldwide social connections.  Perhaps it will get some traction if it links to a 99 cent Apple iPhone® app. running on Facebook.

Keep pushing forward

Jeff Vinson


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One Response to “Cisco & Verizon Video Chat?”

  1. Kelly Says:

    You have touched on a fundamental issue with product offerings that affects technology roll-outs and business innovations. As the carriers consolidate into very large customer databases. Their considerations of any (not just new) technology roll-outs gets very murky for these carriers.

    We need the innovation, we all know there are a lot of abandoned customers. Yet, let’s be clear, 100,000 customers in a niche network feature (even with extremely high margins) is not a concern to the dominant network operators and their vendors. In IPTV with STBs is of a perfect example. Two examples: CATV vendors could not afford to gut their customers by providing to maybe telcos third attempt to enter. The volumes were not there for the manufacturing of telcos. Small companies met the need (2-wire who had to take AT&T as a significant shareholder). Large companies could not manufacture STBs for only 100,000 customers in a new entrants offering. The vendors needed 3-5 million STB orders.

    As a vendor, we need to develop platforms and services for the carriers. The carriers need to develop divisions with economically burdened resources. The carriers need to accept innovation responsibility in a longevity mentality. Otherwise when dealing with smaller carriers who take up the development, have to be left alone to earn a living. The smaller carriers are literally happy to have huge margins that feed 50 employee families, their only thorn is the mixed up departmental reactions from the networks dominating vendors they have. Some want to own the opportunity as fiscally required by shareholders, others want to kill the competitive threat who adds very little revenue, others seek to help the innovator and refer opportunities.


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