Videoconferencing: When is it justified?

Elizabeth Herrell

 Although many companies are considering implementing videoconferencing

as an alternative to business travel, it is not always justified based on

elimination of travel. It is important to evaluate the current nature of a

company’s business travel to determine if videoconferencing will provide a

reasonable return on investment. Although videoconferencing serves as a

replacement for travel, there are also other alternatives, such as

Webconferencing, that should also be considered.

Videoconferencing is an effective means for creating a virtual conference

room across multiple locations for interactive discussions. However, there are

many exchanges that fall outside of this scope and require more personal forms

of communications, such as meetings for employee reviews, project management

reviews and meetings that require a strong personal touch. By understanding the

extent videoconferencing can substitute for face-to-face meetings, companies can

determine if the costs are justifiable.

When evaluating the potential effectiveness for videoconferencing, the

following issues should be considered:

• Type of meetings that can be replaced with videoconferencing and their
  
  frequency
• Maximum number of hours video would be used per month, per location
• Additional uses for videoconferencing that require employee travel, such
  
  as training classes or sales demonstrations
• Network infrastructure required to support video and ability of existing
  
  network to support either additional ISDN lines or IP bandwidth
• Number of locations that require video support
• Picture quality required at each location
• Availability of meeting sites at each location for videoconferencing

Videoconferencing costs are based on the type of system used and the cost for

the bandwidth to support videoconferencing calls. Types of systems for

videoconferencing include:

• Large room systems that offer multiple high-end displays, dedicated
  
  camera, auto tracking, speaker, camera, remote control system and
  
  sophisticated sound systems. Most of these require customized integration to
  
  install.
• Small group room systems that are divided into two configurations, set-top
  
  systems and PC technology. The set-top systems or videoconference
  
  applications plug into standard TV monitors. The PC technology uses standard
  
  host processors and operating systems with dedicated videoconference
  
  hardware and software.
• Personal systems are intended for small groups and are lower in costs.
  
  They feature displays and cameras mounted on a personal PC and are designed
  
  for individual usage.

Costs range depending on the size of the video system. Pricing ranges from

less than $1,000 for personal systems to $50,000 for large rooms systems with

high-end displays. Most room systems are in the $5,000 to $20,000 range.

Additionally, to support 384Kbps bandwidth required for quality viewing, three

128 BRI ISDN lines are required for each location. This requires fees for ISDN

carrier installation, monthly service charges and usage fees as well as

termination equipment for each location.

Recommendations

Companies considering videoconferencing as an alternative means to travel

should establish how videoconferencing would be used to determine if the

investment will result in actual savings. As a replacement for face-to-face

collaborative room meetings and for training, videoconferencing is an effective

communication tool. However, for collaboration sessions between individuals at

their desktops Webconferencing provides a lower-cost solution that focuses on

data collaboration rather than face-to-face briefings. Webconferencing fees

average between $100 and $200 per month per concurrent user and do not require

the installation and management of ISDN lines or additional bandwidth. A company’s

culture is also an important factor in deciding which option is best. For many

companies, face-to-face communication with remote offices by senior management

promotes closer ties within the organization and is worth the expense of travel.