China Unicom to cut video conferencing costs
By Liu Baijia (China Daily)
Updated: 2004-06-01 08:48

China United Telecommunications Corp (China Unicom), the only Chinese full-service communications operator with both fixed and wireless networks, has vowed to bring down the cost of video conferencing and promote the service to small and medium-sized enterprises as well as ordinary users.

"Uni Video has put an end to the professional network era of video conferencing in China," said Tian Wenke, general manager of China Unicom's data and fixed communications department.

While only big enterprises and government departments could previously afford to use video conferencing services and had professional technicians to manage the systems, China Unicom said it has brought down costs for these services and products significantly and made usage much easier.

While traditional meeting organizers need to rent a leased line at a cost of 10,000 yuan (US$1,200) for every location per month, Uni Video's users only need to spend 4,600 yuan (US$556), according to Tian.

At the same time, users do not need to buy special servers for meetings and employ special technicians for maintenance of the system, which will be handled by China Unicom.

China Unicom also formed a hotel alliance with more than 300 hotels in the country, so that small and medium-sized enterprises will not have to purchase conferencing equipment themselves and can just rent the service from member hotels to save costs.

China Unicom also aims to make video phone call services affordable for individual users.

They just need to pay 0.2 yuan (2.5 US cents) per minute for video telephony, even cheaper than the 0.6 yuan (6.2 US cents) which is officially charged for long-distance calls.

Users just need to buy a video telephone for about 4,000 yuan (US$480), with prices expected to continue falling as subscriber numbers increase.

"Video telephony will become a revolutionary communications tool, following mobile phones and broadband technology in popularity," said China Unicom Vice-President Li Zhengmao.

The operator has already built a network capable of holding 3,500 meetings simultaneously and cover 97 per cent of prefecture-level cities in China.

China Unicom has more than 80,000 subscribers for Uni Video services nationwide.

A recent report by the domestic research company CCID Consulting also shows that consumer and demand from small and medium-sized businesses will provide more stimulus for the development of the video conferencing service.

Lin Qijin, an analyst with the research house, predicted compact and desktop conferencing devices, mainly for small and medium-sized companies and consumers, will take a dominant position in the equipment market in 2007.

According to CCID Consulting's report, the video conferencing equipment business grew by 35 per cent year-on-year in 2003 to 1.45 billion yuan (US$175 million) in sales revenues, compared with the 14 per cent growth rate in 2002.

"The wide use of video conferencing in health, telecom, finance and education sectors has boosted the demand for equipment during and after the SARS (severe acute respiratory syndrome) outbreak and the telecom operators are able to run their businesses on a larger scale," Lin said.

He predicted that in 2004 and 2005, the video conferencing equipment market will grow by 20 per cent in average and reach 3.26 billion yuan (US$394 million) in sales revenues in 2007.

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