As business travel drops, teleconferencing booms

By S.A. Mawhorr Daily Herald Business Writer
Posted May 06, 2003

What with terrorism, the sluggish economy, a war and the spread of highly contagious diseases many would be business travelers are picking up the phone or using the Web to connect with clients, partners or co-workers instead of hopping on a plane for a face-to-face meeting as they might have two years ago.

Business travel has dropped by about 25 percent since September 2000, according to the Business Travel Coalition, an advocacy group for business travelers based in Radner, Pa.

Although that's bad news for the struggling airline industry, it's good news for the burgeoning teleconferencing industry.

The teleconferencing industry has seen a 40 percent growth in call volume since Sept. 11, 2001, said Neal Lulofs, a senior marketing manager for MCI, which says its Chicago-based teleconferencing business is the largest in the world.

For nearly two years now, business travelers have had plenty of reasons to stay home.

First terrorists attacked the World Trade Center and the Pentagon. Then a sluggish economy forced businesses to cut back on travel expenses. War with Iraq renewed fears of attacks on Americans traveling abroad. Most recently, the spread of a mysterious respiratory illness known as SARS prompted many companies to restrict travel.

MCI's teleconferencing operations in Asia reported a 30 percent jump in April as SARS spread and more people used teleconferencing to stay off the streets and stay healthy.

"People are avoiding face-to-face meetings even if they're scheduled for just across the street," Lulofs said.

But the growth of the teleconferencing business goes beyond an increased vigilance prompted by threatening events, Lulofs said.

The industry was on track for the same 40 percent growth in call volume during the first half of 2000, before the terrorists attacks, he said.

"A gain in productivity is the reason the industry continues to grow," Lulofs said.

The industry also has grown beyond the traditional conference call in which an operator links several participants into one phone line.

At Conference Plus Inc., in Schaumburg, customers now can tap into the company's network without the help of an operator, using a pass code to gain access 24 hours a day, seven days a week.

Teleconferencing companies, including Conference Plus, also offer customers video over television sets as well as the ability to collaborate over the Internet, said Peter Kosich, marketing director of Conference Plus.

The Web is growing in popularity because participants in a meeting can look at documents together and alter it during the meeting, Kosich said. Although the Web works wonders when sharing documents, streaming video over the Web still is unusual.

The slackening in travel also has given a boost to software companies like Open Text, which has its U.S. headquarters in Bannockburn.

Open Text's software helps run meetings over the Internet, which has proven to be a popular product since Sept. 11.

Most often participants get hooked up via a phone call and then the Open Text software, called Meeting Zone, allows them to log onto the same Web site. From there, they can view the same documents and see changes as they are made, view a Power Point presentation, or illustrate a point using an on-screen white board.

The software also lets participants send private messages to each other, much like passing a note or having a quiet conversation on the side in a meeting.

And after it's all over, minutes to the meeting are recorded and can be archived for future reference as a project progresses.

Although business has been up since Sept. 11, it is gains in productivity that will drive the teleconferencing business in the long run, said Richard Maganini, spokesman for Open Text.

"Fewer people are doing more work," he said. "You have to squeeze more work into less time. Better use of technology is one way to do that."