Polycom Unveils VVX 1500 Media Phone

Polycom VVX 1500
Click on the graphic for a larger view. Source: Polycom

Conferencing giant Polycom is readying what it calls the first “business media phone,” featuring access to enterprise applications, videoconferencing and higher-definition voice quality.

But in spite of the device’s advanced features, analysts aren’t so sure that businesses are ready to pony up for the new Polycom (NASDAQ: PLCM) VVX 1500’s $1,099 price tag.

The unit features a a two-megapixel camera, a two-port Gigabit Ethernet switch, a seven-inch LCD display, a lightweight Web browser, and can even record calls to a USB drive, but Polycom VVX 1500 media phone also
carries a hefty suggested price. There may be value for money when you price out the components, but why would anyone, especially in this economy, pay that much for any business phone?

“The phone is no longer a phone,” said Jim Kruger, vice president of marketing for voice communications solutions at Polycom. “The VVX 1500 allows users to access vital information at a glance on the screen. Content-rich applications are a key focus for us.”

“This is the world’s first business media phone,” he added.

So what’s a business media phone? In a recent report, industry analyst firm In-Stat calls it “a market opportunity,” predicting limited adoption in 2009, followed by a steep adoption curve between 2010 and 2013, with the rate of adoption depending on the level to which service providers are willing to subsidize
the phones. Service providers would, in theory, be eager to sell the phones
in order to provide value-added services.

However, Ian Fogg, principal analyst for consumer products at Forrester Research warns that the adoption of video phones has been stunted in the past by the chicken-and-egg problem: nobody will buy one until they know someone else who has one.

“When I worked for a mobile operator, we found there was a need to create a market for people to call,” he told InternetNews.com. “You need to ask ‘What can you leverage to drive sales of other video phones? Do you need a separate ecosystem’?”

He adds that although the economy has had less of an effect on the purchase
of phones than on the rest of the economy, it is lengthening replacement cycles even as it has little impact on phone use.

Higher-definition voice and SIP

Kruger touts a feature that Polycom calls HD Voice. The feature delivers
higher voice quality by using more bandwidth to deliver frequencies not
usually sampled in IP Telephony.

That usually requires an HD Voice phone at both ends, Kruger admits, but he adds that a Polycom partner is building a system that will deliver HD Voice to Polycom
phones even when the originating IP stream lacks it. In the absence of that
service, he said that most customers will experience HD Voice when calling
within an enterprise rather than outside it.

The phone uses Session Initiation Protocol, or SIP , and Kruger said it will eventually work well with Polycom’s 30 VoIP Vendor Interoperability partners. Initially, the phone only supports Broadsoft. It is not compatible with the proprietary protocols of vendors such as Cisco, Avaya, Nortel, and Siemens.

The applications

Kruger said that applications will sell the phones. For example, in a call center,
the phone’s user could view a record containing vital information about the
caller. In a sales environment, the phone could display key information
about the person being called. There are other applications, Kruger said, in
hospitality and health care.

But mainstream enterprise adoption seems distant. Gartner wrote in a report that enterprise video communications and CRM integration were two to five years away from mainstream adoption.

Kruger acknowledges this and said that the year 2009 will be about developing an
ecosystem, as Fogg suggested, and serving early adopters who he claims are

“We have had an extensive beta with participation from multiple service
providers,” Kruger said. “There is high interest in this product. Our
primary outreach this year is to our service provider and channel partners
and to a targeted end user base.”

The phone has a tremendous number of features and a standards-based
development language that will allow channel partners to develop more
applications. Kruger expects sales to pick up once the channel learns which
applications help sell the phone.

But this prediction assumes that the office of the future will be like the
office of the present, where every employee has a PC and a desktop phone.

Kruger said that the phone will work with PCs and mobile phones, both of
which appear to compete with it. Only time will tell whether or not he is

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