Tony Markel, CEO of the Markel Corp., a specialty insurance firm, tried videoconferencing once before, to save money during the last recession, from 1990 to 1991. But "there were delays in the audio. We were stepping on each other's lines," says Markel, who demands strong communication and teamwork among his brokers in far-flung cities like Richmond, Va.; Toronto; Paris; and Sydney, Australia. Soon his employees were back on airplanes, and the expensive video hookups started gathering dust. So after the terror attacks last September, when travel delays were eating up the time of his employees, Markel thought videoconferencing would be a short-term solution at best. But he attended a demonstration of new equipment, tried it out and was so impressed that, as of Feb. 1, the company has a new travel policy: airfares and hotels will be authorized only if employees can show that a videoconferenced meeting would be insufficient.
That's going to be hard to do. The herky-jerky video and out-of-synch audio of 1991 is gone--thanks to superior hardware and software and broadband Internet connections. The most advanced videoconferencing setups can transmit participants' images with a 3-D-hologram quality reminiscent of Captain Kirk beaming down from the Starship Enterprise. And at every level of sophistication, videoconferencing systems cost a fraction of what they did in 1991. This time, users and industry experts agree, the technology is here to stay. Even after the recession ends and terror fears abate, says Jaclyn Kostner, a consultant who teaches long-distance teams to collaborate effectively, "business people are never going to travel as much as they did. Technology won't totally replace travel, but it will reduce travel."
Accounting giant Ernst & Young used videoconferencing before Sept. 11 but limited it to distance education for employees and for clients in remote locations in Latin America. In recent months, though, the firm has more than doubled its monthly videoconferencing, to replace just about every type of business trip, including client meetings. Software provider PeopleSoft has also doubled its use of videoconferencing among employees and customers around the globe.
Markel's company ordered seven $60,000 Tandberg 8000s--the Rolls-Royce of videoconferencing--which come equipped with 50-in. plasma screens for high-definition video. Presenters can just plug in their laptop to display data on one of the screens. The Tandberg can simultaneously connect to as many as 10 video sites and four additional audio sites. And the equipment will significantly reduce Markel's travel costs--almost $5 million last year within North America alone.
British Petroleum and HQ Global Workplaces are among the companies interested in a $30,000 system developed by the Dallas-based company Teleportec. That system allows video of a participant to be reflected onto a transparent screen to simulate a 3-D image that makes it seem as if the person is in the room. It's an optical illusion, says vice president Philip Barnett, but many who see the images forget that. He still chuckles at the memory of the executive who tried to hand a document to the colleague who was being "teleported" in.