2013 Global Video Conferencing Technology Leadership Award

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2013 Global Video Conferencing Technology Leadership ... - Vidyo

2013 Global Video Conferencing

Technology Leadership Award

2013


BEST PRACTICES RESEARCH

Technology Leadership Award

Video Conferencing

Global, 2013

Frost & Sullivan’s Global Research Platform

Frost & Sullivan is in its 50th year in business with a global research organization of 1,800

analysts and consultants who monitor more than 300 industries and 250,000 companies.

The company’s research philosophy originates with the CEO’s 360-Degree Perspective,

which serves as the foundation of its TEAM Research methodology. This unique approach

enables us to determine how best-in-class companies worldwide manage growth,

innovation and leadership. Based on the findings of this Best Practices research, Frost &

Sullivan is proud to present the 2013 Global Technology Leadership Award in video

conferencing to Vidyo.

Significance of the Technology Leadership Award

Key Industry Challenges Addressed by Technology Leadership Excellence

Businesses are rapidly adopting visual collaboration technologies today that are enabling

them to do more with less and maintain a competitive edge. In a recent Frost & Sullivan

survey of C-level executives, video conferencing ranked highest among key enterprise

communication applications for future usage. Ninety percent of the respondents indicated

that they plan to either maintain or significantly increase the use of video conferencing in

their organizations.

Video conferencing is helping businesses achieve better results at lower costs through faster

decision making, improved quality of interactions, and more cost efficient business

collaboration. According to recent Frost & Sullivan research the market for video

conferencing systems and services stands at $3.2 billion and is forecast to almost double to

$6.3 billion by 2016. This high growth market represents an escalating demand to use video

for all aspects of enterprise communications.

While the business benefits of video conferencing have been tremendous, the market has

been hampered by high priced solutions and performance issues. Due to the high costs

associated with the devices and extensive infrastructure requirements, most of video

conferencing remains confined to conference rooms. The consumerization of IT and the

resulting BYOD trend along with the sweeping adoption of social media networks is leading

to increased demand for video everywhere. Video conferencing deployments must meet the

criteria of being scalable, flexible, and affordable for thousands of users in an organization.

Where traditional video conferencing has failed, newer software-based architectures and

technologies like Scalable Video Coding (SVC) will open the gates of adoption. Vidyo has

been a leader and innovator in breaking the old paradigm and bringing software-based

architecture that is needed to deliver the scale to support hundreds of thousands of

personal endpoints.

© 2012 Frost & Sullivan 1 “We Accelerate Growth”


BEST PRACTICES RESEARCH

Key Benchmarking Criteria for Technology Leadership Award

For the Technology Leadership Award, the following criteria were used to benchmark

Vidyo’s performance against key competitors:

• Development of New Technologies

• Leverage of New Technologies

• R&D Spending as a % of Revenues

• Brand Perception

• Customer Value

Decision Support Matrix and Measurement Criteria

To support its evaluation of best practices across multiple business performance categories,

Frost & Sullivan employs a customized Decision Support Matrix (DSM). The DSM is an

analytical tool that compares companies’ performance relative to each other with an

integration of quantitative and qualitative metrics. The DSM features criteria unique to each

Award category and ranks importance by assigning weights to each criterion. The relative

weighting reflects current market conditions and illustrates the associated importance of

each criterion according to Frost & Sullivan. Fundamentally, each DSM is distinct for each

market and Award category. The DSM allows our research and consulting teams to

objectively analyze each company's performance on each criterion relative to its top

competitors and assign performance ratings on that basis. The DSM follows a 10-point scale

that allows for nuances in performance evaluation; ratings guidelines are shown in Chart 2.

Chart 2: Performance-Based Ratings for Decision Support Matrix

This exercise encompasses all criteria, leading to a weighted average ranking of each

company. Researchers can then easily identify the company with the highest ranking. As a

final step, the research team confirms the veracity of the model by ensuring that small

changes to the ratings for a specific criterion do not lead to a significant change in the

overall relative rankings of the companies.

© 2012 Frost & Sullivan 2 “We Accelerate Growth”


BEST PRACTICES RESEARCH

Chart 3: Frost & Sullivan’s 10-Step Process for Identifying Award Recipients

Best Practice Award Analysis for Vidyo

The Decision Support Matrix, shown in Chart 4, illustrates the relative importance of each

criterion for the Technology Leadership Award and the ratings for each company under

evaluation. To remain unbiased while also protecting the interests of the other

organizations reviewed, we have chosen to refer to the other key players as Competitor 1

and Competitor 2.

Chart 4: Decision Support Matrix for

Technology Leadership Award

Measurement of 1–10 (1 = lowest; 10 = highest)

Award Criteria

Development of New

Technologies

Leverage of New

Technologies

Brand Perception

Customer Value

Weighted Rating

Relative Weight (%) 25% 25% 25% 25% 100%

Vidyo 9.0 9.5 8.5 8.9 8.9

Vendor 2 8.2 8.4 9 8.5 8.5

Vendor 3 8.3 8.5 9 8.4 8.5

© 2012 Frost & Sullivan 3 “We Accelerate Growth”


BEST PRACTICES RESEARCH

Criterion 1: Development of New Technologies

In a marketplace defined by fast technology developments, Vidyo has been at the forefront

of innovation launching products that have positioned the company for growth. The

company’s flagship offering VidyoRouter leverages the company’s Adaptive Video Layering

technology which uses H.264 SVC and replaces the video processing intensive MCU of

traditional conferencing systems with an intelligent packet routing application. By

eliminating the processing from the core of the network, latency is significantly reduced,

delivering better end user experiences. The individual optimization capabilities of the

VidyoRouter enables Vidyo to connect devices ranging in capability from smart phones and

tablets to laptops and desktops and all the way to room systems and immersive

telepresence, in the same call with each endpoint performing up to its full capability.

Vidyo introduced the VidyoRouter Virtual Edition, initially targeting VMware platforms, with

additional virtualization environments to follow. In addition to appealing to enterprises that

employ virtualization internally, VidyoRouter Virtual Edition eases deployments on cloud

computing infrastructure and makes it easier for cloud vendors to embed in their own

services. Moreover, Vidyo’s multi-protocol media server VidyoGateway supports

interoperability with multiple codec and signaling standards: H.264 AVC, H.264 SVC, H.263,

H.323 and SIP. It is going to be available in a virtualized version for VMWare environments

in Q1 2013, offering the inherent operational, environmental, and business cost savings to

be gained from virtualized video solutions.

SVC is increasingly being accepted in the market as a key standard to enable

videoconferencing that can dynamically adapt to varying network conditions such as packet

loss, fluctuating network bandwidth, and network delay. Vidyo was the innovator in

developing an architecture that uses SVC which is now being implemented by other

vendors. However, Vidyo is ahead of the market and is shipping 3rd generation SVC-based

products that incorporate field experience, customer feedback and intellectual property.

Vidyo has also been at the forefront of several other leading technology developments.

Vidyo recently announced VidyoWay - a free cloud based connectivity service for anyone

using H.323 and SIP-based video conferencing endpoints, Lync clients, and mobile devices

to connect with each other and/or with Vidyo endpoints. Scheduled to launch in Q1 2013,

the free service is targeted at users in the enterprise videoconferencing market which is

currently dominated by traditional MCU and gateway solutions and services.

Vidyo has been following the huge market demand for low priced devices and has

announced the industry’s first $750 Executive Desktop System. With the new Executive

Desktop system Vidyo achieves a price/performance breakthrough that delivers up to

1080p30 encode and 1440p60 decode at a fraction of the traditional executive desktop

systems’ cost. Vidyo’s Executive Desktop offers a floating concurrent-use license that

follows the user instead of being attached to a specific device.

© 2012 Frost & Sullivan 4 “We Accelerate Growth”


BEST PRACTICES RESEARCH

Lastly, Vidyo has also been leading the market for extending the videoconferencing

experience to mobile devices. It offers VidyoMobile enabling enterprise mobile users on iOS

or Android-based smart phones or tablets to join multiparty videoconferences with desktops

and HD room and telepresence system participants.

Criterion 2: Leverage of New Technologies

A further advantage Vidyo has when compared to traditional hardware based video

conferencing solutions is that its flexible software-based platform integrates easily with

other communication and productivity tools via a full suite of APIs. The ability for customers

to embed Vidyo into their own web portals and service environments via Vidyo’s APIs has

enabled innovative new solutions and service offerings from a variety of OEM partners

including Google+ Hangouts, Ricoh and Philips who have all brought solutions to market

based upon Vidyo. In addition, several major partnerships may foreshadow the technology

becoming available as part of the infrastructure including Juniper, VMware and Qualcomm.

More recently Vidyo announced that it is adding Nintendo Wii U consoles to the pool of Vidyo

enabled systems. The Wii integration takes Vidyo’s technology into the midst of a huge

mass market and will build critical mass around Vidyo’s software platform. Vidyo’s

partnership with Nintendo is a validation of the power of its architecture and significantly

extends its reach in the consumer market.

Criterion 3: Brand Perception

In a market that has traditionally been dominated by two vendors – Cisco and Polycom -

Vidyo has successfully created a strong brand name and identity in a matter of few years.

Vidyo has consistently built a buzz in the market for SVC and its benefits, aggressively

taking its message against hardware-based solutions.

Vidyo continues to gain market momentum. Although not publicly reported, it is believed

that Vidyo’s videoconferencing endpoint revenue and unit shipments have seen significant

growth in the last few years. While it is growing from a smaller revenue base compared to

competition, it is gaining pace and grew revenue by 82 percent in 2011. Vidyo’s 2011

growth reflects its success in North America and Asia-Pacific regions, which increased by

115 percent each.

Vidyo is currently in an expansion mode. In Q1 2012 when most vendors reported a Y/Y

revenue decline Vidyo grew revenues by 90% for its branded products. With VidyoWay and

several other offerings slated to be released in Q1 2013, it is expected that Vidyo’s adoption

will escalate even further making it a key provider in this space.

Criterion 4: Customer Value

Video conferencing is undergoing a big shift today. There is an ongoing disruption resulting

from the growing need for lower-priced endpoints and software-based solutions. The need

© 2012 Frost & Sullivan 5 “We Accelerate Growth”


BEST PRACTICES RESEARCH

for infrastructure products that can support broader deployments, particularly desktop and

mobile endpoints, combined with the growing demand for cloud-based video services points

at the pertinent need for new and flexible architectures.

Vidyo’s solutions have a good fit with the emerging trends and offer customers a new and

more scalable approach to video conferencing, eliminating the traditional hurdles to

adoption including high fixed costs for multipoint infrastructure, QoS-enhanced networks

and IT personnel. The VidyoRouter is an apt fit for global enterprises, since it saves on

hardware costs that are normally incurred over geographically dispersed deployments and

has a significantly slimmer footprint adding to the operating savings afforded by the lower

cost commodity networks. And the new VidyoWay service will provide a free and flexible

solution for third party endpoints to interact with each other and interoperate with Vidyo

deployments. These factors make Vidyo an affordable and scalable solution for virtually any

sized enterprise.

Conclusion

Vidyo’s market leading innovations continue to demonstrate its technology lead and

commitment to make video conferencing a ubiquitous technology. Vidyo is a deserving

recipient of the 2013 Frost & Sullivan Technology Leadership award in the

videoconferencing market.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth

and achieve best-in-class positions in growth, innovation and leadership. The company's

Growth Partnership Service provides the CEO and the CEO's Growth Team with disciplined

research and best-practice models to drive the generation, evaluation and implementation

of powerful growth strategies. Frost & Sullivan leverages 50 years of experience in

partnering with Global 1000 companies, emerging businesses and the investment

community from more than 40 offices on six continents. To join our Growth Partnership,

please visit http://www.frost.com.

© 2012 Frost & Sullivan 6 “We Accelerate Growth”

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