Did H.323 Kill VCON? Is Blue Jeans Next?

 width=Last week, ClearOne, a provider of audio conferencing equipment with about $43M market cap, announced their acquisition of Israel-based VCON Video Conferencing.

While this puts ClearOne in the precarious position of turning some of their customers into direct competitors and driving some businesses towards their competition such as Phoenix Audio Technologies, it’s a clear a win for them if they can get a big enough piece of the videoconferencing market with VCON.  (By-the-bye both ClearOne and Phoenix make excellent echo cancellation mics that work great with VSee!)

VCON was founded in 1994, and at one point was a public company listed on the Paris Stock Exchange.  Although it did quite well as a provider of traditional standards-based H.323 videoconferencing systems, binding itself to H.323 has kept VCON from innovating, and the company is rarely talked about these days.  My guess is that the VCON acquisition price is in the $3M – 5M range – a heart-breaking outcome considering its glory days as a public company.  On the other hand, companies that saw beyond H.323, like Skype, ooVoo, WebEx, have enjoyed tremendous growth and commercial success even with VCON’s start from a dominating position.

Although standards-based H.323 systems kicked off the videoconferencing industry, the platform is cumbersome, hard to use, has deep security flaws, and worst of all, strangles the ability of the field to focus on user experience.  Rumors on the street is that Blue Jeans Networks is rethinking its H.323 strategy, given its service’s poor adoption so far.  I think VCON is a great wake up call for Blue Jeans.  Only if it can think beyond H.323 and do it well before the company runs out of money will Blue Jeans have a chance to escape the tragic outcome of VCON.

Where do you think Blue Jeans is heading?


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