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IBM to enter Video Conferencing market ?

January 26, 2016 | Telepresence Options

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It's all getting rather interesting.

In late January 2016 IBM bought UStream an online Video Conferencing service for $130m.

UStream might not be a household name but they have been powering services by numerous companies including Facebook and the Discovery Channel. These guys aren't some tiny startup, they have a track record, if not a very public one.

In the last few months IBM has been adding a series of video related businesses to their portfolio.

In 2013 IBM bought Softlayer for $2bn, they are a major player in the cloud computing services, and interestingly enough the backbone for the Lifesize Cloud offering.

Other recent IBM acquisitions include

ClearLeap video management, which IBM bought in December

Cleversafe, a video storage service IBM bought in October

Aspera, a large-file transfer tool IBM bought at the end of 2013

Steve Canepa, GM of Telecommunications media and entertainment at IBM said.

"Video is finding its way into the core of how you provide value to customers,"

The 800lb Gorillas are circling

IBM is not exactly known for making rash or quick decisions. It seems that all these purchases are part of a bigger plan. Beefing up their streaming capabilities is the obvious first step.

There is money in this market and they need to be able to counter competitors such as Amazon, which bought Elemental Technologies Inc in 2015. Interestingly enough Amazon also bought Biba in 2015. Perhaps they are looking to pat these together.

IBM the new Video Conferencing player?

Adding Video Conferencing to the streaming capabilities they have recently bought would now also seem to be part of the play for IBM. This is the piece UStream brings to the table.

It appears at this point like IBM aren't interested in the Hardware business and simply want to tap into the growing Cloud Video Conferencing world. That could change, but would be very out of character for the IBM of the 21st Century.

It will be interesting to see if IBM decides to offer a solution as a standalone technology, or as part of a much larger overall IBM business process solution. My personal bet is on the latter. If that is true the "traditional" Video Conferencing world could let out a sigh of relief, for a while., SAP and Oracle

If IBM do indeed see Video Conferencing as part of building a closer relationship with their clients, and as part of an overall change in the way they do business then it seems logical that, Oracle and SAP would also do they same. Partly because if it works they can't afford to be left behind, and mainly because IBM's competitors can't afford to wait to see if it's successful before making a move in this area.

Is IBM going to buy anyone else?

The next obvious question is IBM finished on the acquisition trail Or do they want to pick up some more businesses to add to the components they have already acquired?

Recently I predicted that 2016 would be a big year for market consolidation. I think that is still true, and the entrance of the 800lb Gorilla IBM is likely to increase that trend as players attempt to bulk up to compete against a real or potentially imaginary foe.

What about Cisco and Microsoft?

Recently I spoke about how Cisco and Microsoft fear each other and no one else.

I talked about the Cisco and Microsoft account control works. One has to wonder if IBM changes that calculation.

What about everyone else?

As stated earlier I believe 2016 will be a big year in consolidation. Players will merge to gain scale, or larger players will buy in expertise. It will be interesting to see if the Unified Communications players like Avaya, Mitel, ShoreTel, RingCentral and Vonage also get embroiled in this along with the more obvious players like Polycom, BlueJeans, Zoom, and Lifesize.

WCC and all that

WCC (Workstream Collaboration Communications) is taking off in many organisations. Solutions like Slack, Spark, and Biba are changing not only the way users communicate but also how the solutions are sold. IBM has a huge background in business process and it will be interesting to see how they develop this. The other workflow players like, Oracle and SAP are also going to be watching very closely.

You think IBM will setup a partner program for Video Conferencing?

The very business model of Video Conferencing has changed, and the reseller and distribution partners are rapidly rethinking their place within in. During a recent interview I talk about the changing business models for resellers. I am pretty confident to state that I believe there is zero chance that IBM will be looking for new resellers for this model.

The answer?

How this is going to all shake out is anyone's guess, but the days of simply doing what you've always done and expecting to get what you've always had, are over. Time to start tracking carefully the positions of all the big players. It's going to be an interesting year or two, and this industry will, I'm sure, look very different in a few years.

About the Author: Simon Dudley


Simon is a contrarian. He makes a habit of being the guy who questions the orthodoxy, the guy who doesn't believe it just because the good and the great said it's true. This has not always been good for his ascent up the corporate greasy pole. However it's been very good for his employers if they are prepared to listen.

The Book The End of Certainty "How to thrive when playing by the rules is a losing strategy" explains why groupthink and the doing what you've always done is no longer the right move.

To keep tabs on his work please follow him on:

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