Telepresence conferences, such as the one shown above, provide life-like audio and video conferencing during which participants appear as if they are all sitting at the same table. Video screens display participants in other rooms from remote locations. Photo courtesy of Tata Communications

The demand for telepresence services is on the rise and Indian telecom heavyweight Tata Communications Ltd. has forged an early foothold in the industry through its workings with Cisco Systems Inc.

Telepresence takes video conferencing to a whole other level. It provides life-like, high-definition audio and video conferencing. Telepresence rooms are set up so that participants in the conference all appear to be sitting at the same table, with large video screens on one side of the table displaying the participants in other rooms. The video images of participants are life-sized, so people appear exactly as they would if they were physically sitting across from the table. Sound and video is specific to each video screen and individual, so that when someone talks from one end of the video table the sound comes from that position. For those facing the video screens, they do not see themselves on a split screen like video conferencing, but instead only see the telepresence participants across from them.

Telepresence is touted as an alternative to traditional face-to-face meetings and a way for companies to save money on travel costs and time and improve long-distance collaboration.

The San Jose, Calif.-based Cisco has been in the telepresence business for some time and focuses on providing telepresence rooms for businesses that range from two seats to six seats to 12 seats to 18 seats. However, these private telepresence rooms carry a high price tag from $34,900 to $349,000. In addition, the nature of the telepresence rooms dictates that there must be two of them: one in one location and another in a different location. Cisco uses 300 telepresence systems internally and has sold 1,000 systems to approximately 200 customers, mostly larger businesses.

Cisco’s partnership with Tata Communications is targeted at bringing telepresence to smaller businesses and individuals, who cannot handle the cost that private telepresence systems carry. In addition, the public rooms are marketed at giving large enterprises, with telepresence systems, the opportunity to meet virtually with vendors that do not have their own telepresence systems. Last July, the Mumbai-based Tata Communications opened five public telepresence rooms throughout India: in Mumbai, New Delhi, Hyderabad, Chennai and Bangalore. In October 2008, Cisco and Tata Communications announced their intent to establish 100 public telepresence rooms around the world by the end of 2009. The goal is to target major business centers. Public rooms are already online in Boston, New York and London and Cisco has opened up some of its telepresence rooms for public use in California.

Public rooms are available to rent by the hour. Prices vary depending on location and local currency, but the typical fee in the United States is approximately $500-an-hour.

However, introductory specials lower that cost to the equivalent of $150-an-hour in some cases. Tata operates the facilities and uses its international telecommunications backbone network to link the rooms.

Lee Ann Lim, Tata Communications’ telepresence marketing manager says that the potential for telepresence is massive and that the only thing limiting it is the technology, which is why the partnership between her company and Cisco is crucial because it pairs Cisco’s telepresence technology, the hardware that makes the system work, with Tata Communications’ massive global telecom network that can support the video and audio and management services necessary.

“We see a lot of interest mounting ever since we have launched our international public room and we expect more interest as we launch more rooms on the network,” said Lim.

She believes the benefit to all businesses is easily quantifiable. “Telepresence can change the way a company does its business: in terms of recruitment, in terms of R&D, in terms of the number of services it offers,” Lim said.

According to Lim, Tata Communications defines the telepresence market in three areas. The first is the private rooms that companies, such as Cisco, build for corporate clients. The second is public telepresence rooms, like Tata Communications. The third is an exchange network, which can connect all telepresence rooms regardless of vendor or network.

Telepresence differs from more traditional video conferencing because participants do not see themselves on a split television screen alongside other participants, but see others life-size and directly in front of them, as if sitting at the same table. Photo courtesy of Tata Communications

Tata Communications has just publicly announced its intent to launch such an exchange service, The Global Meeting Exchange. Lim said The Global Meeting Exchange should be available in mid-July or August and will connect Cisco’s private telepresence rooms, as well as Tata Communication’s public rooms, with rooms by competitors such as Hewlett-Packard Co., Tandberg and Polycom.

Lim said that the interoperability compromise with the competition is worth the effort in exchange for what Tata Communications believes will widely open the telepresence market. She pointed out her company’s goal is to connect any telepresence room with any other telepresence room in the world.

“The more people connected the more useful the service is,” she said. “It is really breaking down walls for telepresence and it is making it available for more and more people.”

“Telepresence has a lot of promise,” she added. “People react to it in such a personal way … It has immediacy. You feel like you are in the same room together.”

As a member of the $62.5 billion Tata Group in India, the subcontinent was a logical jumping off point for Tata Communications’ public telepresence rooms. The rooms in Boston and London are housed in Taj Hotels, whose parent company Indian Hotels Company Ltd. is also part of the Tata Group. However, Tata Communications is branching out to other areas and partners for other locations. Such an agreement with the Philippine Long Distance Telephone Co. will result in a soon-to-be-opened public telepresence room in Manila.

Emerging markets are key markets for telepresence, according to Lim. “It is a very attractive thing for customers when they see Tata Communications opening up these public rooms in difficult to get to locations,” she said.

J.J. Kazakoff, manager of the public telepresence room at the Taj Boston hotel, says he sees an increasing amount of business for telepresence services. According to him, customers are impressed because all they have to do is sign up – this is even easily possible over the Web – and show up for the meeting and Tata handles the rest. Users push a button and they are off, connected with other parts of the world.

He points out that the technology behind telepresence is impressive, but there is no trace of that during the user experience. “The goal is to forget about the technology and just be here at the same table,” he said. “No matter where you are in the world, no matter how many locations, everybody is at the same table.”

Still, first-time users can expect to be wowed a little, as the experience of seeing colleagues around the world brought together with real-life interaction over the telepresence video screens is impressive. “They oh and ah for a couple of minutes, but their reaction at the end is, ‘That was a productive meeting,’” Kazakoff said.

According to him, job candidate interviews are one of the popular uses for telepresence so far, as well as regular blocks of time for business functions such as quarterly meetings. Business customers range from law firms to telecom companies to marketing consultants.

ABI Research, a New York-based firm that provides analysis and forecasting of emerging trends in global connectivity, is as high on telepresence as Cisco and Tata Communications.

In a recent report the firm asserted that the telepresence industry is rapidly growing and that once the cost on private telepresence rooms comes down and operability is increased between different telepresence systems usage will flourish. The firm predicted the global revenue from managed telepresence services, like what Tata Communications and Cisco are offering now with their public telepresence rooms, will exceed $360 million in 2011.

“One of the major trends we are seeing is the lengthening of the supply chain and because of that there is more of a need for face-to-face meetings with partners around the world,” said Stan Schatt, ABI Research vice president and wireless connectivity practice director. “Business travel is expensive and telepresence is a cheaper option … It’s not just about the cost of the flight. It is about the time away.”

According to Schatt, the response to traditional video conferencing from many executives is that they do not find it all that useful, but telepresence, on the other hand, is found very attractive. “Telepresence is different because the key thing is eye contact. When someone is talking they can actually look at you,” Schatt said.

Schatt predicted that countries such as India and China will see the most use for telepresence in connecting with foreign customers.

He believes a combination of widespread public telepresence rooms and cheaper private telepresence room options will drive the market.

“When you start to get the price down to a few thousand dollars, what it does is it increases the market from high-level executives to mid-level managers,” said Schatt. “That is where the major growth is going to be initially.”