Analysis: Facebook video a major blow to Google and Cisco

By Edward F. Moltzen on Jul 7, 2011 7:02 AM
Filed under Services

New generations of Facebook apps in the offing.

When Mark Zuckerberg made his “super awesome” announcement that Facebook would team with Skype to embed video calling into the fabric of the social network, it was more than just a new product launch.

The blueprint that Zuckerberg unveiled not only adds video calling as a Facebook feature with Skype, it immediately establishes it as the world’s top technology platform for voice-and-video based communication. With 750 million Facebook users and 170 million users of Skype, which will provide the technology used in Facebook video, the nearly 1 billion combined installed base will have a Day 1 scale never before seen.

That’s bad news for both Google and Cisco. Each have been working to leverage video communication as a strategic offering but must now must play second-fiddle to Microsoft, the new owner of Skype and part-owner of Facebook.

While Google (with video-enabled Google Talk) and Cisco (with its vaunted TelePresence and high-quality video platform) both focus their video communication on different functions, both will be impacted by the scale, user design and potential ecosystem of Facebook video.

Cisco's investments, in particular, have been massive and have taken place over a period of years. Its TelePresence solution combines high-definition, 1080p video with what is essential high-definition audio -- and fueled by dedicated network pipes that transmit the video and audio data at very high bandwidths. It is such a high-end investment that only a few thousand installations have taken place to date.

Skype's investments have also been massive, but have focused more on delivering voice and video to the highest-possible volume of the market. What Skype has lacked in technological superiority it has made up for in mass.

Based on the announcement, which calls for Facebook video calling to start rolling out to subscribers immediately, here's what to expect:

• Third-party software vendors will be able to leverage the Facebook-Skype video calling technology to create a new generation of apps for Facebook, turning this from simply a new feature into a new video communication platform;

• Facebook’s native contact-management function -- combined with video calling -- will eclipse anything currently in Cisco’s stable based on sheer numbers alone, and will provide a much more robust experience than anything Google has provided to date;

• Facebook video has the potential to immediately alter use patterns in a way that’s more favorable to Microsoft, Facebook and Skype -- which will have the benefit of shared R&D to keep them all on the same page. That will loom large as other technologies, including collaboration software and mobility, remain key battlegrounds between the big technology companies for both market share and mind share. (Although Zuckerberg admitted that Facebook video for mobile devices isn’t yet ready, nor did he share when it might be, Skype, for its part, offers a standalone app for iPhone, for example, that provides video chat at 3G bandwidth.)

From a technical standpoint, Skype will do the heavy lifting and essentially weave its video calling into the Facebook communication dashboard. Facebook subscribers will simply receive an update that will allow them to request one-to-one video chats with friends. The video experience will be essentially the same as a Skype video call today.

Pitfalls For Facebook and Skype

There are potential pitfalls, though, for Facebook and Skype. Zuckerberg indicated that, rather than focusing on building out new data centre capacity to handle a crunch in data traffic, he was pleased that Skype’s approach uses much less bandwidth and infrastructure than traditional IP-based voice and video communication. But with Facebook and Skype each having their own history of high-profile technology glitches and outages, any failures could also be failures on an unprecedented scale as well.

From a privacy standpoint, people on Twitter, for example, were saying even before the announcement that they disdained the potential for having to re-manage their Facebook privacy settings – already a very touchy subject with millions of Facebook subscribers – to account for who could now contact them via video.

And with Facebook-hacking and rogue links, long a bane of many subscribers to the social network, the prospect of video on the service creates the potential for spam and Trojan attacks on a very larger scale. For individuals, that creates a series of concerns. For businesses, it could render Facebook a non-starter during an interim rollout period while best practices are adapted to the new platform.

But the bottom line is that while Facebook and Skype will be blazing a new trail by opening up new use patterns for video communication, Google and Cisco are faced with a daunting task of protecting their own investments in this area. Skype CEO Tony Bates, for example, let it slip that pay-based video calling on Facebook is on the company’s radar screen – opening up the potential for businesses to engage Facebook video for low-cost, video customer engagement, among other things. That potential is one that should be of greatest concern to Google, Cisco and their partners.

Google could argue its video calling is better integrated into the user experience, while Cisco could argue it has the superior video-communication technology. But with almost a billion Facebook-Skype installations around the world, they’ll be swimming against a tidal wave unless they act quickly and boldly and enlist their own armies of partners around the globe.

This article originally appeared at crn.com

 
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