It's all very well, says Marc Ambasna Jones, for multimedia vendors to try to schmooze corporates with fancy features, but at the end of they day, will the technology ever be regarded as anything but an education aid?
Can dealers make money from multimedia? The assumption has always been that to earn a living from selling multimedia, dealers had to bolt a CD-Rom drive, sound card and a couple of speakers on to a PC to bring it into the multimedia age. Throw in a copy of Microsoft's Encarta and you've got the ultimate multimedia sale. For consumers maybe, but for businesses, think again.
The applications putting pound signs into the eyes of multimedia dealers of 1996 are far removed from the games and educational image the word multimedia conjures up. Video conferencing, training, broadcasting, retailing, the Internet and intranet are some of the leading lights of today's business applications employing multimedia technology. Originally high-price solutions, all these applications have been subject to serious price erosion and are destined to make even bigger inroads on business culture over the next few years.
But it's a common reaction from businesses of all sizes to turn their noses up at the mere mention of multimedia, fearing the loss of work hours through noise generated from sound-intensive applications. Getting the message across that multimedia is a technology and not a solution is often a difficult one. It is true to say that most people's perception of multimedia is through their children's educational software or games.
Multimedia in the workplace is far removed from this image. Video conferencing has long been the standard bearer of business multimedia usage, and with Picturetel's release of a desktop video conference kit, the application is becoming affordable. Dataquest predicts that the video conferencing market will be worth around $1,137,000 worldwide by 1997 compared with a 1995 figure of $757,000 for both hardware and software. With growth for the market standing at 116 per cent, it's easy to see why most multimedia pundits back video conferencing as the application to secure a multimedia foothold in corporate business.
'I would expect to see a broader acceptance of video conferencing as an application and not a technology,' says Kevin Dale, Videologic sales manager of Europe and the Pacific. 'It comes down to hardware. If video conferencing was offered as an upgrade without having to change the whole system, the take-up would be fast.'
Tim Hill, senior consultant at research firm Inteco suggests that although video conferencing is without doubt an important application, it is still a niche. He says 'anything to do with the Internet' will be a massive opportunity. It may seem an obvious thing to say given the mass hysteria that has surrounded the Web for the past two years, but Hill is still seeing limited use of the Net in business. Inteco is planning a research study on the penetration of the Internet in the business community and Hill believes the Internet and the development of the intranet will be major markets.
'Companies are starting to use the Internet and online services as publicity and marketing media,' says Hill. 'These same companies are also realising that they can use cheap and cheerful Internet technology to provide their businesses with a useful medium for information and contacts internally.'
Bandwidth limits mean that multimedia is low level, but Hill says this will change as better cabling and communications like ISDN links become more universal. 'At the moment the Internet is fairly useless as a business tool, because it needs to be more interactive,' says Hill.
The development of the intranet, especially if it becomes more interactive, could pose a threat to IBM's Lotus Notes, which in effect does what the intranet promises, but is less flexible and more expensive. 'Notes hasn't turned into a white elephant for IBM yet, but the fear is there,' says Hill. It hinges on whether intranet developers can increase the level of multimedia activity, therefore increasing the overall effectiveness of the technology as an internal communications tool.
'Maybe the Net will convince businesses to take multimedia on board,' says Eddie Moore, multimedia product manager at Ideal Hardware. 'But it may take a while longer.' Moore also suggests that the intranet could be significant, especially if it is replacing elements of other internal communications services. 'The use of an intranet browser could make life easier, especially for less skilled individuals, to look for information and records. It does, however, depend on individual companies and users.
It may not be a universal solution.'
This could be an early problem for the intranet as a volume product for business. But that is not the end of the world. If intranet technology has to be adapted to fit different business cultures, the consultancy and solution development skills of the dealers should come into play.
After all, that's where the real money is.
One of the more renowned business multimedia solutions is retailing kiosks.
'Most UK retailers and financial service providers are looking at kiosks,' says Hill. 'And most major manufacturers, including IBM, ICL, Olivetti and Siemens Nixdorf have high-level strategic plans for how, where and when they're going to make money from kiosks. These plans do vary. Some believe money will be made just by selling boxes, while others believe systems integration is the answer. It is undoubtedly a big opportunity.'
Hill also sees CD-Rom as a similar tool for getting messages across.
'In principle, there are some opportunities for product brand owners to use the CD-Rom as a marketing tool. It's a good medium for catalogues, for example, something which may interest companies like Argos.' Problems can occur when a large portion of the target audience does not have access to a multimedia PC. It maybe a little while longer before consumer cataloguing on CD-Rom takes off.
On the kiosk front, things seem to be moving quickly. Car manufacturers in particular have taken to the technology. 'Twelve months ago, we were talking about the early adopters of kiosks,' says Dale. 'We're now at the beginning of the technology going mainstream. More businesses have acknowledged the use of the technology as a good way of getting messages across.' The German market has really taken off, but Dale is expecting some serious growth in the UK this year. 'The market is moving along quite rapidly now,' he says.
Despite this enthusiasm for the developing kiosk market, Dale's biggest love at the moment is training. 'Businesses are taking it very seriously,' he says, 'both for procedures training and product training.' CD-Rom is still the delivery mechanism, but Dale anticipates an increase in development with the promises of higher performance video technology from the hardware makers. 'If any Var is looking for a good opportunity, multimedia-based training is a good place to be. There are quite high volumes now but it still needs Vars to service the market.'
In fact, Dale admits that without the dealer and Var channel, multimedia technology would be almost entirely lost on the business community. 'The channel is critical. Firms such as ourselves produce the technology.
It's Vars and dealers that have to wrap it in something the corporates can understand and use for their businesses.' Training in particular is well suited to a constant tailoring for specific businesses. Dale says the demand for bespoke courses is increasing and should continue.
Both Hill and Moore agree that training is a key area for the technology.
Most, if not all, firms need some form of training, and multimedia can be very cost-effective in the long term. Matching technologies to markets can be a major headache, but training is one of those services that is not market-specific.
Apple is currently developing markets for its Mac-based multimedia technology that has helped its channel forge strong links in growing business communities.
A new release of Quick Time, developed with help from SGI, Netscape and Java Soft, is due out next month. It will be capable of reading nearly 90 per cent of the multimedia content on the Internet as it includes Mpeg capabilities, according to Colin McGregor, Apple enterprise business manager.
This should enable Apple to maintain its strong position in multimedia authoring and development.
Broadcasting is fast becoming a crucial market for Apple. According to McGregor, 'Quick Time rules' in this market already. Damien D'Souza, Apple marketing manager for the entertainment industry, says broadcasting is 'a specialist target market', and Apple dealers have already developed specific solutions on Mac equipment. 'Time is critical in a news broadcasting environment. We have pioneered a system where the journalist can pull down videos, access databases, deal with languages and so on. There are some key industry names looking to implement the system.'
D'Souza admits that much of the work is done hand-in-hand with third parties. Fresh from an Apple-run broadcasting event in Milan, he also talks about dealer developed solutions being warmly received by the broadcasting industry. 'The dealers show broadcasting solutions, answering problems, talking their language and understanding their business. It's not about Apple showing the technology.' Apple sees this industry as a major opportunity for its multimedia products but McGregor sees a broader future which can be built on the foundations of Quick Time and the very nature of the Mac's development capabilities.
One potential growth area is marketing services. 'Large firms are putting creative digital design to outside companies with Macs,' says McGregor.
'There is a case for getting these companies to have some internal facility.
There is also brand management. Creating the brand and putting the brand into an overall marketing service is also important. This is where Apple will see the most changes in the market.'
With Dorling Kindersley and Microsoft developing multimedia titles on the Mac, Apple has a strong image to sell itself into any developing areas of multimedia applications. These developing areas offer massive potential.
McGregor believes that CD-Rom and the Net are the accessible approach to more inaccessible aspects of multimedia. 'The rich content of a CD-Rom can be hooked up to the immediacy and feedback of the Net and it's possible to see how high value-add applications in the information industry, such as libraries, can make great use of multimedia through this medium,' he says.
One area which is often dismissed as gimmicky is TV. Apple itself has a TV receiver and TV window for the Mac but it is in business that multimedia TV will take off. Business TV, as it is generally termed, will play a major part in getting multimedia technologies into the workplace. 'It's a more realistic application than interactive TV because businesses have an internal infrastructure that has defined costs,' says Hill. 'The technology becomes affordable for a car maker with 100 dealers that it has to keep in touch with and provide marketing support and training.'
Videologic has dabbled in selling TV services to corporates, particularly in the City. Piping Reuters or Press Association news services to screens is proving popular. 'TV technology is well understood and a lot of what we're doing with it is not crippling workstations,' says Dale. This is key. Multimedia is a swanky technology but many applications can drink memory and often turn fast and efficient business machines into snail-like number crunchers.
Business TV is one of those areas which will only develop in areas where time is of the essence. As a broad business application, it is limited.
This is part of the problem when talking about multimedia in the business community. It's not about multimedia at all, it's about solutions.
Unfortunately, multimedia has become this all encompassing word with no specific use in business. As a technology it has a major role in developing solutions across the board, many of which will undoubtedly increase business performance. As an application, it only has one real market area and that is in education.
The merging of audio, video and computer data into one technology is without doubt a major achievement. But applications employing the technology have been slow to take root and are only now showing real signs of mass penetration. Perhaps the most important thing here is that dealers have a major role to play.
Unlike many other technology areas, dealers are being used in a big way to forge mulitmedia a marketable product. With that in the bag, the most difficult job is still trying to convince businesses that those products are worth buying. Perhaps avoiding the word multimedia in the sales patter might help.
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