Retail in Asia

In Trends

Telepresence growth peaks in 2009-10, Frost & Sullivan predicts

Large businesses are increasingly turning to video as an alternative to travel when budgets are strapped – and among the gainers are telepresence solutions. Revenues for ready-built telepresence suites in Asia-Pacific grew an estimated 71.1 percent in 2009 (up from 46.6 percent in 2008).

For 2010, research and consulting firm Frost & Sullivan expects market growth of 64.4 percent, with revenues of over USD73 million by year end. Weaker growth is expected thereafter.

New analysis from the company finds that the telepresence sector – covering 14 Asia-Pacific countries – earned estimated revenues of USD44.4 million in 2009. The market is forecasted to grow at a compound annual growth rate of 22.9 percent per annum to reach a market size of USD110.1 million by the end of 2015.

Telepresence services are more costly to operate than conventional video conferencing facilities. Yet, according to Frost & Sullivan industry manager Pranabesh Nath, making use of the technology can actually enable firms to trim their bottom line. "The immersive nature of telepresence enhances user experience and productivity, while simultaneously trimming the operational expenditure of a company," says Nath.

"Major vendors were quick to seize the opportunity presented by the harsh economic climate and were successful in selling a large number of ready-built systems in the last two years," he adds. "Many are even offering generous discounts to make a sale."

Not for long, Nath expects stiff competition in the next two years from more affordable mid-range high-definition (HD) video conferencing systems, as well as customised immersive solutions, which system integrators are starting to offer at lower price points. Growth in revenues for ready-built telepresence systems are expected to decline sharply after 2010, dropping to 32.1 percent growth in 2011 before falling to well below 10 percent for subsequent years. No growth is expected in 2015; of course by then, the unit price for ready-built systems would have declined too.

Nath is not ready to dismiss the sector though. "Telepresence is a small but very visible segment that is expected to significantly impact the visual collaboration market," he says, adding, "We are already witnessing a blurring of boundaries between an immersive telepresence suite and conventional HD video system, and this will only accelerate in the next one to two years."

Vendors currently market telepresence systems as ready-built units, but in the future, Nath believes it is likely that newer business models will emerge with greater involvement from service providers, offering customised immersive systems as a managed service. He expects such services to show promising uptake as they would eliminate the need for users to invest in hardware and in-house maintenance skills.

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(Source: PR Newswire)