When Telecom screened an ad showing a woman videoconferencing from Piha Beach on Auckland's West Coast while her partner painted her toenails and hummed a love song loudly enough to be heard over the link, Piha residents saw red.
Their beef was that Piha is badly off for telephony and internet services and that a videoconference, as portrayed in the ad, would be impossible.
Telecom chose a pretty but unrealistic location for the ad, but it wasn't all fantasy -- Telecom does offer videoconferencing services to areas better off for bandwidth than Piha.
Telecom's enhanced applications category manager, Tammy Hendricks, says the carrier has offered videoconferencing services since 1993 and that from 1999 to 2001 revenue from such services doubled.
"Paradoxically, revenue is now starting to plateau as we see videoconferencing gaining in importance as many larger companies are buying in-house systems."
Telecom's principal service is "booking and bridge", in which Telecom hosts conferences for clients who don't have their own gear. With the trend towards companies buying their own equipment, Telecom's videoconferencing revenue -- which Hendricks won't divulge -- is "shifting to the connectivity that enables these [companies' own] systems".
Telecom's videoconferencing services are delivered primarily by ISDN, as is the case around the world, "because of its scalability, security and availability", and the company offers clients with videoconferencing gear an ISDN bridge to support conferences involving more than three sites, if the clients' own set-up doesn't allow it. Reconciling different network protocols via gateways is another service Telecom provides to clients, Hendricks says.
While ISDN is still the predominant videoconferencing medium, Telecom is working on delivering the service over IP (internet protocol), consistent with the carrier's stated goal of building an all-IP network.
To do so it must overcome issues such as security and bandwidth use. "Security when using IP outside the WAN means firewall issues -- we're looking at virtual private networks."
Bandwidth issues include prioritising available bandwidth when videoconferencing from participants' PCs, using webcams.
"If you're having a videoconference, it may affect your ability to download email and you may need to take bandwidth [from the email function] to do it effectively."
Videoconferencing over IP from PCs with webcams raises system issues, not connectivity ones, Hendricks says.
"When six or seven people are videoconferencing from a room, there's one link for them all, but with individuals doing it from their PC, there's a link for every person."
Telecom is providing the private network over which nine Otago high schools and The Correspondence School are providing a range of services including videoconferencing.
The cost to the consumer since Telecom began offering ISDN videoconferencing has decreased markedly, Hendricks says.
"Across almost all elements, costs are now at least half what they were and ISDN charges have seen an even greater decrease, to less than a third of what they were.
"In the old days, there were a lot more caveats when videoconferencing [vendors] tried to illustrate cost savings against travel but now it can easily be demonstrated in all cases."
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TelstraClear spokesman Ralph Little says the newly merged telco's network is a major carrier of videoconferencing services, but apart from providing connectivity it doesn't offer videoconferencing in a major way.
"When we offer end-to-end solutions to customers, if videoconferencing is one of the desired features they want then we will work with partners to provide it."
Several smaller companies also provide videoconferencing services in New Zealand, including Asnet Technologies, the distributor of products from US equipment maker and service provider Polycom.
Asnet general manager Chris Stewart says 30% of Asnet's sales today are to organisations wishing to videoconference over IP. "Two years ago, the figure was 5%."
While many organisations are still using ISDN, he says, some are "evolving to using IP inside their WAN". He says the ongoing call costs of ISDN are behind the shift, with IP links allowing, say, 500kbit/s traffic and thus shared high quality video "at no additional cost".
Among the Polycom products which Asnet provides in New Zealand is MeetNow, which allows a party using ISDN to videoconference with a party using IP, via a gateway.
Sales in New Zealand have risen 5% to 10% since the September 11 terrorist attacks in New York, with "US-centric" companies -- such as New Zealand offices of US companies and New Zealand companies with offices in the US -- leading the way. He also says there's been a "general re-think" among New Zealand companies though not to the same extent as in the US.
Other providers of videoconferencing equipment and services in New Zealand include Sony and Cogent Communications, which supplies products from US equipment maker Tandberg.