Teleconferencing Takes Off As Fuel Costs Ground Airline Flights; Nortel, Cisco, Polycom Among Likely Beneficiaries
Submitted by EnergyTechStocks.com
As high oil prices ground airline flights, teleconference service providers are taking off.
NASDAQ-traded Polycom Inc. is in a state of “hypergrowth,” its vice president of marketing told a trade publication last week. Cisco Systems told the same publication that teleconferencing systems are its fastest-growing product and that they have saved Cisco itself $150 million in travel costs.
Meanwhile, the news site Greenbiz.com reported two weeks ago that Nortel Networks has signed global business consultancy Deloitte to a multi-year, multi-million-dollar deal covering up to 130 locations worldwide. Still another potential winner is Tandberg ASA, a Norwegian firm that develops video conferencing systems. Traded on the Oslo exchange, Tandberg recently reported results in line with analysts’ expectations. Its sales in the Americas were up significantly.
Conferencing technologies are expected to generate $8 billion in revenue in 2008 rising to $10 billion in 2012, according to Wainhouse Research, which follows the industry. It isn’t just high airline fares that are driving growth. Multinational companies are increasingly seeing teleconferencing as a way to reduce their carbon footprint, a step all may be forced to take soon should carbon taxes or trading become a standard feature of doing business.
The combination of lower costs and smaller carbon footprints through teleconferencing could prove a deadly combination for airlines now struggling to hold on to passengers and likely to struggle in the future to win them back, assuming they can get their fuel costs under control. Consider Procter & Gamble, whose employees reportedly have avoided taking 3,000 trips in the eight months since a Cisco teleconference system was installed.
