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Microsoft Announces Intention To Acquire PlaceWare

Microsoft’s acquisition of Web conferencing provider PlaceWare and the creation of a new business unit, the Real Time Collaboration Group, within the existing Information Worker Business signals to vendors, customers and financial analysts that Microsoft is seriously focusing resources on technology with which it has only dabbled heretofore. The company is developing real time text and rich media presentation, conferencing and collaboration into its business solutions and creating a platform for independent solution vendors and service providers to do likewise.

Driven by the need for information workers to share virtual "spaces" during interactive teleconferences or to show slides or other materials to virtual audiences during presentations and lectures, strong growth in conferencing product and service revenues is measurable and appears sustainable. Although not considered the brand equity or revenue leader in its segment (positions currently held by WebEx), PlaceWare was offering its services to a respectable 3,100 enterprise accounts by year end 2002. Based on trends seen in early adopter and "early majority" segments, Frost and Sullivan’s 2002 report on the topic estimated that by 2008 over $2Billion will be spent on Web conferencing.

Unfortunately, similar predictions were heard a decade ago. In 1993, after more than 20 years of prototypes and proofs of concepts, AT&T released a line of personal conferencing systems. Nearly eight years ago Microsoft introduced NetMeeting. Both of these attempts to bring conferencing into the mainstream failed.

What’s different this time?
The obstacles to realizing the potential of real time communication enabled systems can not be overcome simply by having a large company or two increase investment in this area. Microsoft’s foray into real time conferencing in the mid-1990s with NetMeeting had a number of problems that proved debilitating (some would argue fatal). And, many of the obstacles NetMeeting adopters encountered were outside the sphere of influence of its designers and promoters. Today’s infrastructure is better suited to the task: CPUs in PCs are faster, more memory, more bandwidth is available, cheaper, etc.

Furthermore, Microsoft’s current management incorporated some of the lessons learned during the NetMeeting era and the company is taking a different tack in 2003. First, the company is approaching real time communications, conferencing and collaboration with a clear client-server architecture. Beginning with Windows XP, real time media acquisition, compression and management is built in. The server components, code named Greenwich, provide routing, logging, management and other enterprise and carrier grade services. Second, the lip service paid in the past (i.e., NetMeeting era) to adopting communications standards is a corporate mandate: the RTC client and Greenwich server support the SIP standard, and extensions, and embrace emerging standards as they stabilize. Third, one platform and strategy won’t fit all size enterprises in all markets. The same technology in a service provider/hosted environment is appropriate for deployment in an enterprise, provided complementary components such as IP/PSTN gateways are available. Finally, leveraging the Greenwich server capabilities for real time communications does not presume that a deployment is a pure "Microsoft shop." Greenwich will support the same functionality to applications that have written to its API whether the corporate e-mail messaging platform is Lotus Notes or the IP telephone system is provided by Cisco or Avaya, as long as the communications devices are SIP-compliant.

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