Indian companies turn to video conferencing to cut travel costs

Indian companies turn to video conferencing to cut travel costs

Bangalore: Binoy Joseph, an employee of a multinational company, was preparing to go abroad for the first time in his life. The 34-year-old was to attend a two-week training session in Raleigh, North Carolina, at the end of this month.

Then last week, he received an email from his employer saying the session had been postponed. Meanwhile, training via video conference will have to do.

“It’s a far cry from travelling overseas," says the content developer. Building relationships just isn’t the same, interruptions are plentiful and connectivity tenuous.

But it’s the reality for Indian workers who do business around the world as their employers—and their clients—slash travel budgets to fight soaring airfares amid an economic slowdown. In fact, curbs on travel have been announced, formally and informally, in many companies across the world—the exceptions being critical interactions with customers.

Polycom Inc. is the leader in the video conferencing space. Computer networking company Cisco Systems Inc. launched telepresence, a set of virtual technologies which it claims delivers a near in-person experience, in India in late 2006. It clinched a deal with Indian Hotels Co. Ltd, operator of the Taj group of hotels, and has since sold the product to several technology companies including Wipro Technologies Ltd and the Indian unit of Yahoo Inc.

Cisco itself has saved $279 million (Rs1,395 crore) in travel costs since it installed telepresence, says Ranajoy Punja, vice-president for advanced technologies, Cisco India and Saarc, or South Asian Association for Regional Cooperation.

Says Girish Rao, head of IT solutions at consumer products firm Marico Ltd, “We use the Microsoft Office communications server (which offers video conferencing, live meetings and chat) for collaborative work-like production and dispatch planning across locations."

Marico has installed the product across its seven plants and eight offices across the country. Rao says, “While we have not quantified the monetary savings, there is huge savings of time. For instance, instead of travelling from Pondicherry to Dehradun which would take one-and-a-half days, we video-conference."

Sanjay Manchanda, director of the business division at Microsoft Corp.’s India unit, expects a boom in the video conferencing market. “This kind of scenario raises interest levels and necessity...Top of themind is cost savings. Travel and hotel expenses is the first place any CFO (chief financial officer) would look at first to cut expenses."

A survey by consultancy firm Frost & Sullivan pegs the Indian video conferencing market at $5.5 million in 2007. It’s projected to grow at a compounded annual growth rate of 23.2% till 2014.

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