Unified communications company Vidtel was founded in 2008 to bring interoperable and inexpensive video conferencing to the small- and medium-sized enterprise market.
The company's flagship product, MeetMe, is a cloud-based hosted video conferencing service that promises near-frictionless video -- no IT department necessary, they insist -- for the price of phone service. It competes with business-focused services from Cisco, Polycom and LifeSize, free consumer services from Google and Microsoft and middle-of-the-pack services from disruptive startups such as Blue Jeans Network.
I spoke with CEO Scott Wharton (with VP of marketing Mariette Johnson Wharton along for the ride -- yes, they're married) to get a better handle on how they're attacking the unified comms market.
ZD: How are you getting this service out there? Earlier this month your rival Blue Jeans Network announced a deal with Salesforce.com to get in front of their customer base.
SW: We're 100 percent channel-focused. Blue Jeans is going to enterprises directly.
If you look at the video conferencing market, over 95 percent of equipment is sold over the channel. By doing it like Blue Jeans, you can definitely get a sugar high. Our method takes longer to deliver results. Between us, it's the tortoise and the hare.
ZD: Speaking of Blue Jeans, your service is half the price of theirs. Are you targeting different customers?
SW: On the MeetMe side, we're going for a similar group of companies. We just don't need to pay back so many VC dollars -- we're not spending it on advertising.
ZD: OK, OK. So what are your target customers actually complaining about? Is unified comms a solution without a problem or a real time-saver?
SW: On the MeetMe side, people may have an internal conference room -- using Polycom, Cisco, LifeSize -- and they want to bring in someone from, say, Philadelphia on Skype. Well you can't. Or it's too hard. People want to bring in third parties without bringing in their IT guy.
The other case is having people in a conference room huddled around a laptop, but someone is dialed in and can't see that.
Or often, it's an issue of scale and economics. You can't take what you do for 10 rooms and bring it to 1,000 people.
ZD: So we've established the opportunity. Why isn't everyone raving about this stuff? What are your challenges in breaking through to potential customers?
SW: There are marketing challenges, explaining the different types of solutions. Understanding the issue and explaining a fairly complicated thing to people. It takes time; it's not obvious. It's like webinars 10 years ago. Clunky technology, but now everybody uses them.
ZD: I can't stand them, but I digress.
SW: It's a Goldilocks problem -- the humongous presence [of Cisco et al] and the cheap Google Hangout. We're somewhere in-between.
A lot of the advertising that Blue Jeans has been doing has actually helped us. It's creating awareness in the market.
The other problem is the channel -- it's less expensive [than direct sales], but you need to train people. There's a little bit of a lag. We've done really well signing up the channels but we're in the process of getting them successful. Different channels go different speeds -- the InFocus channel we have took time, but now they're selling a lot of MondoPads. More recently we announced some of the bigger A/V dealers, who are under the same pressure -- how do I support people on tablets? A lot want to build up their own brand.
ZD: Is the webinar dead?
SW: There's a lot of FUD in the video space. Vidyo announcing free services that may or may not exist. A new quasi-consumer service that may not work that well, or has asterisks. There's a lot of stuff out there that's confusing for the end-users.
If you could make people more interesting, then I think you could solve the problem. (laughs)
ZD: I'm talking to you via Skype. I use it and Google Hangouts regularly to train writers. How do you pull people away from free option?
SW: If you can do something over the Internet, there's going to be some marginal cost [because it's built into the quality, or lack thereof, of the user experience]. Part of what we're doing is focusing on the business customer that wants higher quality and is willing to pay for it.
The other part is interoperability -- Google's not interested in that. Every business is going to make the business technology decisions that they want.
There's a dirty little secret on the consumer side for how their services are so cheap. They use mesh technology -- with a bunch of people, the [data] draw is additive. If each person is 1 megabyte, and you have eight people, that's 8 megs up and down. We send it back as 1 meg.
People tell us, "I want Skype Plus." I think there's a huge market for that.