Web Conferencing Market On The Rise
biz.yahoo.com
By Kathleen Cholewka
Looking for the next big ``e-thing''? It could finally be conferencing. Although the industry has had its ups and downs, several privately held companies--including Evoke, PlaceWare and WebEx, which are actually making money selling Internet-based conferencing services--are gearing up to go public.
Evoke (proposed nasdaq ticker: EVOK), whose 1999 revenue was $2.6 million, is scheduled to go public on July 17. PlaceWare, whose 1999 revenue was $4.3 million, filed its S1 on March 3, but has not said when it will go public. And WebEx, whose 1999 revenue was $2.5 million, filed its S1 on March 31 and has also not said when it will go public.
The pending public offerings are proof that Web conferencing is quickly catching on as a cool, cost-saving application for businesses. As is true with most Web applications, the point of Web conferencing is its low cost and efficiency, as compared to regular phone-based or person-to-person conferences. For example, Web-based conferences--whether they are sales meetings, seminars or live product demos--can include an unlimited number of people, know no geographic limits and require only that participants have a Web browser.
But the Web-conferencing industry has also experienced some less-than-stellar performance over the years. Companies either struggled for a concrete identity or waited for technology to catch up to specific business plans. For example, CuSeeMe Networks (Nasdaq: CUSM - news), which has been selling online client conferencing software since 1994 and went public in 1996, had to change its name from WhitePine Software because of its ties to the floundering videoconferencing industry. What's more, Munich, Germany-based WebSentric, because of technical problems, postponed the launch of its service in September 1999. There has also been rapid consolidation over the last year: Speakerlabs, Netpodium and Contigo have been acquired.
Still online conferencing is supposed to grow to $1.8 billion by 2002, according to Collaborative Strategies, a research firm in San Francisco. In addition, Web conferencing is predicted to eclipse instant messaging as the fastest growing interactive service among big businesses over the next year and a half, according to Forrester Research in Boston.
Even the big boys of networking are interested. Akamai (Nasdaq: AKAM - news), recently launched a combination chat and video streaming conferencelike service. And as service providers begin to look for new ways to generate revenue from their networks, conferencing may be one of the first for sale. Conference Plus, Global Crossing (Nasdaq: GBLX - news), Sprint (NYSE: FON - news), WorldCom (Nasdaq: WCOM - news) and U.K.-based Geoconference are reselling PlaceWare's services.
That's enough to encourage the investment community. Mountain View, Calif.-based PlaceWare is set to gain $30 million in funding this month. The investment should sustain the company until the end of 2001, according to Chief Executive Barry James Folsom.
But PlaceWare wants more. The company, which counts IBM (NYSE: IBM - news), Sales Logix and Salesforce.com among its customers, plans to follow an acquisition trail for the rest of the year, hoping to buy companies that develop new software or additional customer marketing and event coordination services to keep an edge on the competition.
Of course, in the turbulent Internet market of late, competitors have only good wishes for each other. ``Our current read is that every day the market is warming up to IPOs,'' says PlaceWare's Folsom. ``Evoke is also going out there first, and we wish them the best of luck.''
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