The Net
January 26 , 2005

Long-Distance Relationships

Judges of Collaboration Software

Business applications that create value mostly seem to be things like GL packages or SCM packages. But we've always included web conferencing in our coverage, because we think there is an important value prop. "Out of the airports, into the desk chairs;" what's not to like about that?

For that reason, when B2B Analysts was asked by the SIIA (Software and Information Industry Association) to be a judge in the conferencing and collaboration category for its "prestigious Codie awards," we accepted gladly.

As judges, we were given free use of some 14 or 15 web conferencing packages (some of which were wrapped up with other oferings), including household names Webex and Raindance, but not Placeware. (Microsoft didn't enter.)

We went into the judging with one large question in mind. Why has that value prop been so uncompelling to businesses? These products have been out for years, but we've never yet heard an airline complain about competition from Webex. Why not?

We now have the answer. Most web conferencing products don't work very well. Under certain circumstances and in the right hands, they can be beaten into submission and service that provide some simulacrum of utility can be forced out of them.

Why is this? Well, some of the problems are technical. But to a large extent, it appeared to us that this industry just took a wrong turn somewhere and got stuck. This means that there is plenty of opportunity in the space right now, and a few vendors appear to be poised to take advantage.

What the Judges Found

We went into this judging with a view about what web conferencing ought to be, which needs to be explained up front. Since we think that web conferencing ought to become a utility almost as ubiquitous as teleconferencing, we were looking for products that anybody (even the staff at B2B Analysts, Inc.) could use easily, experienced or not, without training. (This, by the way, is the only position that would have allowed us to view ourselves as qualified judges.)

With that view, we felt justified in saying that a winner (actually a recommended finalist) would have to be a product that we ourselves would want to use again if we had the need.

Only one web conferencing vendor met that simple criterion: Citrix's Go To Meeting.

As for the rest of them? Performance was so unreliable that we would be reluctant to use them for any business purpose at B2B Analysts, Inc.

Honestly, our standards were not high. All we wanted was something that would allow us to start a meeting on time, have all three people on line, and end it on time. Not one of these products were able to do this. For each vendor, meetings failed catastrophically for at least one invited user (typically out of three) in at least one of the 2-3 tests. Either we couldn't schedule the meeting, or we couldn't get the product to download, or the password system defeated us, or the product didn't run on one computer, or it ran so poorly that we preferred to end the meeting.

Let me put it another way. Our tests of the products that entered the contest suggest that standards of usability and reliability in this space are roughly those of automobiles in the 1920s or of Windows 3.1 in its early phases. You can make it run, if you have to. But you need a big IT staff, lots of preparation, lots of training, very low expectations, or all four.

Why are these companies still in business? Well, there is a small class of people who are willing to pay, despite the products' significant limitations.

Who are they? They are people who want to broadcast presentations over the web. Typically, they don't care much if all the participants show up. They don't want much interaction with the participants. And they don't think what they say is important enough to the participants to warrant actually going and talking to them. They are willing to pay up front for this, and they'e also willing to invest either their own or IT time in order to make sure the presentation actually happens.

You don't need to do a lot of interviews to figure this out: you can see it in the products. It's a competitive market (14-15 vendors! and others who didn't enter); consequently, people work hard to differentiate themselves. But the differentiation is all around bells and whistles. Only one or two of the vendors actually question the basic market model and try to compete for a different market, by supporting people who want to do something else with the technology.

We will also be coming out with a buyer's guide for this technology, so I'll leave most of the details there. But if you are looking to present a web conference, here's what the general run of vendors provide.

• hey allow you to schedule a meeting and send out notices via e-mail. The assumption is that the meetings are password protected and that voice contact is provided over the telephone. (VoIP is attempted by many, but is not yet reliable.) This process is (with two exceptions) burdensome, and it frequently did not work.
• For first time users, they download software to their computer: in one case, more than 50 MB of software. Downloads often did not work or took an undue amount of time.
• They provide you with a "meeting space" where you can display a file (sometimes the choice of kind of file is limited) to the other participants. Sometimes the file is actually uploaded to their server (for speed purposes); sometimes they are grabbing the image on your desk.
• The meeting space will typically allow chat, questions, some opportunity for participants to signal the presenter, and whiteboarding (where everybody can use rudimentary drawing tools, sometimes on a shared space and sometimes on the presentation.
• Most will allow users more or less to take control, but delay times are so terrible (10 seconds was not terribly unusual) that this is effectively impractical.
• Most will provide video of the presenter, and some will allow pictures of all participants, but bandwidth and delay problems make video primitive.
• Firewall and Windows XP protections (like pop-up blockers) interfere with these products, often preventing them from working.

In actual meetings, unless you really know what you are doing and have motivated participants, we found that most of the bells and whistles (chat, participant monitoring, even the whiteboard) were useless because they were too hard to manage and the delays were too great. Nevertheless, it appeared that most of the vendors were trying to differentiate themselves by ringing changes on these relatively useless features.

When you have a lot of vendors each trying to crowd each other out of a relatively small market with relatively bad products that trumpet inconsequential features, there are two questions to ask. One, how on earth did this ever happen, and two, what will happen next?

A Market that Never Developed

>When web conferencing first got started, the people who seized on it wanted web broadcasts that would take the place of in-person presentations. They were salespeople, company executives, or trainers who didn't want to go to the expense of traveling to give a presentation or wanted to reach a geographically disparate audience. They were willing, even eager to pay, because other costs of touching an audience (airplanes, advertising) were also high, and this was both competitive and innovative.

The companies that emerged to serve this market focused on two things: developing an infrastructure that would actually allow them to send audio and video around the world and establishing market presence and credibility with the buyers. These buyers were either people who controlled a budget for training, marketing, or corporate communications or IT people who were negotiating conferencing as part of a larger telecommunications deal.

Webex won, with Microsoft LiveMeeting (Placeware) coming in a long way second. Webex based on claims that its proprietary network provided superior reliability, a lot of investment in marketing and sales, and pretty good support for the kinds of meetings that its buyers wanted to run.

Unfortunately, by winning, it locked itself into an expensive model. The product is expensive and difficult to use; it needed expensive support, expensive sales, and expensive infrastructure. As an industry leader, it was unable to generate the profits that would be required either to innovate its way out of all this expense or put its competitors out of business.

We tested Webex several times. It was by no means the worst of the competitors, but it was also by no means the best. Meeting scheduling was challenging to the inexperienced person who was charged with doing it. Login procedures were so difficult and cumbersome that they failed not infrequently with new users. Support was OK, but it couldn't respond in time to fix real-time problems. Meeting management (the in-meeting interface for the presenter) was so difficult that I had to stop what I was doing in meetings in order to figure it out. And Webex itself never delivered on things like recordings of meetings, which it promised. And delay times were (despite Webex's claims) occasionally horrendous.

All three of us came out of the Webex experience feeling that we would not want to use Webex for a webcast unless there was no reasonable alternative and unless we were willing to invest serious time and effort into making the webcast work.

But of course we're not the audience. The Webex model is really designed to serve presenters and participants who use the product frequently and can put up with its idiosyncrasies. I was discussing the problems I had with the Webex salesman who called us afterwards. He was irritated that I hadn't taken the training course first. "If you want to learn to drive, you have to take driver's ed first." True enough. I just don't think web conferencing ought to be as difficult to learn as driving a car.

For that model, in my view, Webex is about in the middle of the pack, from a performance and functionality point of view Avacaster, Netspoke, Brainshark, Centra, Intranets.com, Raindance, Documentum eRoom, Click to Meet, Macromedia Breeze, ECN Interwise, and several others had similar products and similar problems with usability and performance.

One of the other firms that provided judging in this category (one that makes its money writing marketing materials for companies in the space) made Webex its top choice among these firms. I disagree. But I can see how a reasonable person with that kind of experience can make that choice.

Within the world that Webex (and the others) serve, you see, the problems that we ran into are seen as unimportant or not worth fixing. (I complained to Webex about the "feature" that made password distribution so difficult and was told that "Yes, people experience it, but it's not that important.")

The end result, in a way, is satisfaction all around. People who understand web conferencing and want it have a marketplace where there are options. Webex and its competitors serve that market. And those of us who want something different get frustrated and just go away.

But I think the situation is unstable. First of all, it appears to me that there are many more markets out there, people like the stalward three at B2B Analysts, Inc., that would like to use this kind of service if it worked. Somebody (but probably not Webex) will go after them. Second of all, I think that the market is being supported by buyers who are overpaying because they think they are getting the more general web conferencing services (what B2B Analysts wants) but are not in fact.

We talked to several clients about how they buy and use web conferencing services. Many are Webex (or Placeware or Raindance) users that buy the web conferencing as part of a larger telephone services package. They tell us, "We make the conferencing available, but our people don't seem to be very interested in using it. We'd like to encourage use, because it helps lower our costs, but what can we do?"

People like this will eventually figure out that what you do is ask for lower prices on web conferencing, so that the cost will match the benefit. We're already getting anecdotal evidence that this is happening. Frankly, we'd be surprised if that wasn't happening.

Desktop Collaboration

Among the 14 or 15, fortunately, we did find that some vendors have begun to innovate their way out of this situation. Rather than compete directly with what I will now call the webcasters, the these companies had decided to rethink what they were providing, aiming at serving a far broader market that is, at the same time, far harder to reach.

To understand what they're trying to achieve, however, you have to let go of some ideas about how this market ought to develop. The normal picture is that a technology like this evolves by serving premium users first, then evolving and commoditizing until everyone uses it and can afford it.

When I first started following this market, I pictured a utility that would allow everybody to do remotely what they now have to do in person: "see" the other participants (through video), "interact" with the other participants (by voice or by computer), and "share" materials (by looking at each other's computers), and talk--multi-media conferencing as easily, naturally, and smoothly as today we teleconference.

That didn't happen; instead, the market got stuck serving only the premium users and giving them a very limited product.

The one or two vendors (Citrix and Macromedia) that are trying to break out of this do so by distinginuishing between webcasts and desktop collaboration. Desktop collaboration is precisely the kind of conferencing that we thought was being served by the market, but isn't. They are each going after a different segment of the desktop collaboration space, each with products that are in some ways far more limited than the webcasters' products.

One vendor, Citrix, allows you to do the following. Say you call me on the phone. You'd like to go over a presentation I'm going to do for you or maybe a spreadsheet. I can say to you, "Why don't we just look at it." I can click the Go To Meeting button in Outlook, send you a URL, and you are able to see that presentation on your desktop. We're both looking at the same thing, and we can talk about it. If we want to plan this in advance, we can set up desktop sharing as easily as we set up a teleconference; the number is actually provided, and we can do the whole thing from Outlook, including logging in.

Well, we have a need for that, if it works well, And it worked very well indeed. Consequently, it was the only conferencing product that we wanted to have after the contest was over. It was easy, straightforward, and simple. It worked every time. It was great.

But it only serves this kind of meeting. You can have multiple people going over the desktop. But extensive sharing (though provided) is impractical. And most of the other bells and whistles are absent. You wouldn't want to use Go To Meeting for a webcast. But for a few people huddled over a spreadsheet (remotely), it's terrific.

Macromedia's Breeze product does something quite different: it tries to support remote meetings where several different sets of materials need to be gone over. Think a district sales meeting where everybody needs to go over pipeline and sales figures. With Webex, Raindance, etc., such a meeting would get bogged down because everybody would get lost in all the materials and it's very difficult to transfer control. But Macromedia has taken pains to design an interface that gets around most of those problems.

It also does something else very clever; it doesn't try to bundle teleconferencing in with the product. Indeed, it is designed to be invoked (as a service?) by other providers of teleconferencing. This helps them focus on what they want to do (provide software) and makes it easier for them to challenge Webex's hold on the resellers.

This potentially wonderful product had only one small trouble: it didn't work. As with the early version of Macromedia Dreamweaver that I used to use when I started doing Short Takes, it was very buggy. A few versions from now, though, I think it will be a highly competitive product. As a webcaster, it's maybe at par. But for interactive meetings where a lot of work needs to get done, it seems well ahead of its competitors.

Whither the Market?

If you just listen to the tone of the previous sections, you'll think that Webex will wither away in the next six months. Not so. Webex is far and away the industry leader and will remain so, because most people who want to put money into conferencing capabilities want to do webcasts.

People who want to do something more (like go over some material in a small meeting or hold a working meeting with remote participants) don't know that this technology exists, aren't used to working with it, don't know how much it costs, and don't know how to buy it.

Like other now-common consumer technologies (the iPod, or instant messaging), it will take some time for the natural market for the non-webcast products to become familiar with what's possible and learn how to take advantage. Unlike either the iPod or IM, moreover, this technology can't easily be marketed to consumers; with firewalls interfering and IT in charge of the budget, most business consumers aren't able to buy this stuff or, if they could buy it, use it.

The technologies offered by Citrix's Go To Meeting or (further off) Macromedia Breeze are, however, genuinely compelling. So eventually, they will create a market niche and (probably) dominate it. Since there are so many more people who can use this kind of technology than there are people who do webcasts, I think these niches will be larger than the current niche.

How will the market evolve? A couple of things might happen or are already beginning to happen.

• The crowded webcast space begins to be commoditized and prices fall significantly. This is already beginning to happen, but as noted above, prices are supported by intermediaries (telephone companies, mostly) that package in Webex or Placeware with their other conferencing capabilities.
• IT and corporate executives begin to realize that even though they are paying for interactive meeting support from the webcast vendors like Webex, they're not actually getting it, and they begin to seek out alternatives.
• Other large software providers (Oracle, Microsoft, and SAP) realize that they can package in meeting support with their product at a relatively low price and begin to do so. Oracle is trying this now; Microsoft tried it, but seems to have retreated.
• Early adopters at corporations try out things like Go To Meeting or Breeze (when it works), and they insist that others try it, too.

Until some combination of these things happen, you can expect to see the market stay pretty much as it is: Webex dominates, people use conferencing software for webcasting, and prices are high.

But I hope that in one or two years, you and I will think it routine for you to call me and say, "I don't agree; look, I've worked up a model." And I say, "OK, let's look at it." And the next thing we do is walk through the spreadsheet together. Sitting at our desk. Over the web.

Pretty cool. Not as cool as an iPod, but cool.

To see other recent Short Takes, click here for a listing.

An overview of the conferencing market.