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Optical/IP

Nortel Trumps Cisco?

12:30 PM -- Last week I had a meeting about meetings in Nortel Networks Ltd. 's New York Office. We were discussing Nortel's telepresence service, which was announced back in May through a partnership with Polycom Inc. (Nasdaq: PLCM). While it was my first time in a telepresence room, and my experience in video conferences is close to zero, I came away very impressed with the service.

I met with Dean Fernandes, Nortel's VP and GM of Network Application Services, who was in Toronto for the meeting. It really felt as if Dean were right there in the room with us. There was only about a second of latency between the time I would speak and Fernandes would hear it on the other end in Toronto. The cameras were hidden behind the LCD screens so that parties on both ends of the conference made actual eye contact with each other during the meeting. Another feature that made Fernandes's presence seem real was audio that would literally travel across the room with him. So if he got up from his seat and walked to the other side of the room in Toronto, the sound of his voice would also move across the room in New York.

One of the other big names in telepresence is, of course, Cisco Systems Inc. (Nasdaq: CSCO), and Fernandes expressed strong confidence that Nortel's service was far surperior to Cisco's. "Cisco's telepresence is not nearly as immersive as ours is," he said. "They put a couple of plasma screens in front of you, but it's not the same immersive experience as this."

Fernandes even went as far to say that Cisco and the rest of the competition is 12 to 18 months away from even catching up to where Nortel currently is with telepresence. While I haven't experienced any of these competing services first hand, I can agree with Fernandes, that Nortel's is very cool.

But cool comes with a price. To have such an immersive experience requires a lot of expensive equipment and a lot of personnel managing the service. The room I was sitting in had two big LCDs in the front of the room and seating for eight. It comes with a price tag of about $300,000. So it's no surprise that the majority of the interest in Nortel's telepresence has come from large financial institutions, and the installations for the most part are aimed at only "C-level executives." See below for some pictures of the experience.

Happy Thanksgiving!

— Raymond McConville, Reporter, Light Reading

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Pete Baldwin 12/5/2012 | 2:58:25 PM
re: Nortel Trumps Cisco? I'd add that I'm still flabbergasted that Cisco built all the TelePresence A/V parts itself, claiming there was nothing "suitable" on the market. There's got to be something more to that.
Pete Baldwin 12/5/2012 | 2:58:25 PM
re: Nortel Trumps Cisco? Hm. A lot of what you describe here sounds a lot like the Cisco TelePresence demo -- the directional sound, the eye contact, etc. Not sure what's better...

The price sure isn't! I guess Nortel can put a $300K tag on it because Cisco did ... but Nortel isn't using all home-grown components like Cisco was. You'd think Nortel could therefore offer a better price.
litereading 12/5/2012 | 2:58:22 PM
re: Nortel Trumps Cisco? does it matter what C. builds or develops themselves, or does it matter more that their solutions work well, as well or better as any one of their competitors and priced at a competitive value. The fact that Cisco's solutions tend to work very well, has made them the successful company they are today.

btw - I work for a Cisco competitor.
desiEngineer 12/5/2012 | 2:58:22 PM
re: Nortel Trumps Cisco? Quoth sailboat: "I am sure Cisco did the software.. after all software is their strength."

Tongue firmly in cheek :-)

-desi
^Eagle^ 12/5/2012 | 2:58:22 PM
re: Nortel Trumps Cisco? don't believe everything cisco tells you regards "building the AV parts themselves.

at least not until you actually take apart the product and see for yourself what parts they "built" themselves and what parts were bought.

you might be surprised to see how little of it they actually built. I would wager they did not build the TV's, the camera's, the microphones, the other pickups, etc. I would bet that most of the "AV" portion of the kit was off the shelf and simply repackaged by Cisco to have the combination of packaging and stylish fit they were looking for. I am sure Cisco did the software.. after all software is their strength.

sailboat
rahat.hussain 12/5/2012 | 2:58:21 PM
re: Nortel Trumps Cisco? Questions to reporter who reports only half the story:

Why on earth would you get impressed by the technology/marketing of one telepresence company and report on competitive merits based on the claims of the PR folks?

Should you not file the story after getting the same demo from Cisco?

Or, can you simply file the story and report on the impressive Nortel's telepresence system?

(Which would have been fair, except you had to take it to the next complete suck-up level of quoting Fernandes as saying: "Cisco's telepresence is not nearly as immersive as ours is," he said. "They put a couple of plasma screens in front of you, but it's not the same immersive experience as this." Really, what else is he going to say? We are a me-too product?)

It is time reporters stop getting swept away by "PR extraordinaires" and start digging into the real merits and product claims.

If there were a turkey award for lop-sided reporting, this timely reporter would get the honors!

odo

p.s. No CSCO fan here, but just calling on some basic reporting fundamentals.

bollocks187 12/5/2012 | 2:58:20 PM
re: Nortel Trumps Cisco? How big is this market ? The price tags of 100K - 300K seem over the top. Is it not just a better form of video conferencing.....



Pete Baldwin 12/5/2012 | 2:58:18 PM
re: Nortel Trumps Cisco? sailboat:
"don't believe everything cisco tells you regards "building the AV parts themselves."

Ah. See, that's the kind of thing I meant when I said there must be something more to this...
Raymond McConville 12/5/2012 | 2:58:18 PM
re: Nortel Trumps Cisco? odo,

You raise a valid point, but I did admit that I have not seen cisco's service and I am not endorsing Nortel's words as my own.

That being said, I am looking into seeing Cisco's demo first hand as well and I will certainly post on that when I get the opportunity.
Pete Baldwin 12/5/2012 | 2:58:17 PM
re: Nortel Trumps Cisco? 7 -- yes, true, and that's a good followup to Sailboat's point.

Why didn't Cisco want to use another vendor, though? I have a hard time believing nothing was "good" enough. Couldn't have been a price issue -- we're talking about a $300K room! Patent issues, maybe?

... By the way, there are a couple of startups doing TelePresence-like systems. I'll have to check out Teliris in SF sometime soon.
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