BMDE Report Group 9
BMDE Report Group 9
BMDE Report Group 9
BY GROUP - 9
Vidhi Agarwal PGP/24/191 [email protected] 9726979676
Bharath Chandra PGP/24/232 [email protected] 9490421699
Radhika Nema PGP/24/233 [email protected] 9826467733
Shubhi Sharma PGP/24/238 [email protected] 9811624274
Uttam Italiya PGP/24/245 [email protected] 9726966444
Varun Sahni PGP/24/247 [email protected] 9953390326
a. Introduction to Industry, firm & its relevant products and evolution of the industry
Companies in this industry assist users in communicating globally, whether it's over the phone or
the Internet, through airwaves or cables, wires, or wirelessly. These companies established the
infrastructure that enables data to be sent anywhere in the world in words, audio, or video.
Since the invention of the telegraph in the early years of the 18th century the industry broadened
with every innovation - telephone, radio, television, computer, mobile phones that changed
people's lives and brought rapid progress in the business. The transformation from wired
communication to wireless, and technological advancement in the telecom industry provides
stable long-term growth for this sector. With technological advancement, the demand for video,
text, data increased, and the revenue generation got shifted from equipment to high-speed
internet access and related services. The fastest growth came via services produced and
transferred over mobile networks, i.e., Residential and small business markets.
Video conferencing is the smallest but fastest-growing segment within the industry, as more and
more communications and computing methods move to mobile devices and cloud-based
technology. This sector is expected to be a keystone as the telecommunications industry
continues global expansion. It was in 1964 that Bell labs launched its picturephone which
enabled the first transcontinental video call between two venues. Later, in 1993 PictureTel
introduced a new product which converted PCs into videophones which in 1995 enabled the
world's largest multipoint, global video conference. Various messaging services were launched
meanwhile including Yahoo! and MSN messengers. Samsung launched the first video streaming
3G video cell-phone. Skype was introduced in 2003 which allowed 25-person video calls with
free download and Internet access which was acquired in 2011 by Microsoft. During the span of
2010-2011 various instant messaging services like Whatsapp, Viber, Facebook Messenger and
other applications like Google Hangouts, Duo, Cisco Web-ex, Slack, Zoom were introduced.
With the changing norms for businesses and individuals across the world, video-conferencing
has taken over the world. Convenience and its ability to facilitate communication has made
video-conferencing essential all over the world. Earlier, this industry was only a means of
communicating with friends and family but the increasing demand from the corporate sector has
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helped it evolve into an accessible, affordable communication medium for businesses of all
dimensions.
Leading video conference organizations are adopting cloud based business models to improve
the quality and accessibility of their services. Investors' money is flowing into famous platforms
like Microsoft Azure and its software-as-a-service products, as well as Amazon Web Services.
Big data and analytics workloads are also gaining traction to introduce more customized and
cutting edge features over video calling and conferencing.
● The COVID-19 pandemic, and the shift to remote work and video conferencing, are
undergoing rapid cloud adoption. The cloud is increasingly being viewed as a digital
transformation engine and a technology that enhances business continuity by businesses.
Tasks were mostly completed on cloud infrastructure as work was forced to go remote
due to stay-at-home orders. Microsoft Teams and Google Meet, for example, became
cogs in the companies' wider cloud ecosystem. Zoom not only makes money from
subscriptions, but it also operates on cloud services like AWS and Oracle.
● For businesses, multicloud is both a selling point and an aspirational target. Companies
are well aware of the dangers of vendor lock-in and want to abstract their applications to
be transferred between clouds. Hosting platforms allow companies to leverage several
benefits of cloud computing.
● Data collection and analytics also play a significant role in meeting customer demands.
The more client data a company has, the more customized their services can be. Leading
video conferencing platforms are well-known for providing customers with features on
their platforms from storing data to customized experiences.
● Artificial intelligence, analytics, IoT, and edge computing would set the top conferencing
platforms and services far apart from the competitors
Skype is a proprietary telecommunications programme that focuses on providing video chat and
voice calls between computers, tablets, and mobile devices. It was first released in August 2003.
Skype uses a freemium business model, with free Skype-to-Skype calls and a debit-based user
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account method labeled Skype Credit for calls to landlines and cell phones (over conventional
telephone networks).
The company tried to face digitization by launching newer versions of the same application
without giving much focus to its features. Skype's modern app was updated, and the win32 client
was released. It then released three Universal Windows Platform (UWP) apps. Now, Skype is
deprecating those three apps in lieu of relaunching its single UWP service. As a result, there
hasn't been much progress in Skype's desktop features, as the company is still unsure how to
create software for desktop users. Skype is made up of a number of different components,
including a lot of different devices and a lot of different ways to link to the network, which
results in a lack of visibility. This makes it difficult to monitor the final product, which manifests
itself as a poor customer experience, such as frequent call drops and the continuous requirement
for IT teams to stay on top of various scenarios involving rapidly evolving components.
Skype did not deploy additional bandwidth when different competitors started emerging in the
market. Their biggest mistake was to underplay the role that digitization was playing in the
market. This led to multifarious problems for the users on their end some of them being call
drops, or calls not connecting at all. This has been a persistent issue for its customers and was the
reason a lot of people switched to different platforms like zoom etc. as soon as they were
developed. This shows that because Skype did not react proactively in the era of digitization, the
only reason its customers stuck to it because they did not have any other option.
The era of digitization made sure that only the most dynamic of the companies would survive
and thrive. It was the test of survival of the fittest in the digital era. This meant Skype had to be
proactive in the issues faced by its clients and customers, and this is exactly where it lacked. A
lot of competitors thrived on the fact that Skype was not quick in addressing the glitches and
problems in their software. Skype is used by a large number of people on their computers,
laptops, and smartphones. This is where the issue begins, as Skype continues to have trouble
with correctly syncing read messages across platforms. If users log in to Skype from a different
device, they'll be faced with the discomfort of reading dozens and dozens of texts. Even if the
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messages have been read, older messages are often displayed as "unread." This shows their lack
of adaptability to the digital era and is one of the major issues they faced.
In the digital matrix, among the three sets of players in the vertical axis - industry incumbents,
tech entrepreneurs and digital giants, Microsoft is a digital giant. Gaining from the long standing
position in the digital space, Microsoft certainly has resources to acquire industry incumbents of
similar industry or from other industries to enhance their investment portfolio. Skype was
acquired by Microsoft and became its first video conferencing tool in the product portfolio.
Having an abundance of resources, Microsoft has added Microsoft Teams as its another product
in the video conferencing platforms. Among the three phases in the horizontal axis, Microsoft
falls at “collision at the core” in two ways. Firstly, with Skype it challenges the traditional
telecommunication services by providing users with an alternative to make voice or video calls
over the internet. Secondly, premium Skype services were also offered along with the Microsoft
Office package. Moreover, Microsoft has consistently improved offerings through Skype by
integrating the product with cutting edge Machine Learning and Artificial Intelligence providing
users with options like real time translation, smart messaging and captions. Despite multiple
efforts on behalf of Microsoft it failed to gain enough traction for Skype when the Video
Conferencing was in a boom and failed to leverage the benefits of Office ecosystem to acquire
more users for Skype.
B. Competitor analysis
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Zoom tried to be different from the start, in a market where services like Skype were probably
often disliked than valued. Investors appeared to believe in Zoom's vision, as set out in its
shareholder letter: "video is the essence of communications." However, it seems that the future
arrived much sooner and more suddenly than anybody might have predicted. Almost all people
knew they wanted something like this. Windows, iOS, macOS, Chrome OS, Android, and Linux
are all supported by Zoom. It's known for its user-friendly interface and accessibility, regardless
of technical experience. One-on-one meetings, community video calls, desktop sharing,
extensions, web apps, and the ability to watch and have meetings automatically transcribed are
some of the features. Users can choose a virtual background to use as a backdrop behind
themselves on certain devices and operating systems, which can be downloaded from various
websites. The version is free to be used for conference calls of up to 100 people at once, but
there is a 40-minute time constraint if there are any more than two people. Paying subscriptions
are possible for extended or bigger conferences with more functionality. The worldwide
lockdown necessitated the use of a virtual link, and Zoom jumped at the opportunity.
As the world has been halted by the Pandemic, companies across the globe have adapted
video-conferencing to keep them going. During the period, Zoom with over 300 million active
people on their platform hailed as a disruptive technology in the era of Covid. The platform has
been recognised for video conferencing by various industries and users, surpassing the reach of
incumbents like Microsoft, Cisco Webex, Google Meet.
Video conferencing industry, which people thought had hit its saturation point in early 2000s,
was dominated by the incumbents like Microsoft’s Skype and later joined by Cisco Webex,
Google Meet and other platforms. These incumbents had the right products available with them
but they focussed on profits rather than improving the quality of their products. As a result, they
were successful in earning huge profits by selling high-quality products to deep pocketed
companies but on the other hand, a huge chunk of small and medium enterprises who weren’t
willing to pay for high quality video conferencing didn’t become their consumers.
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Zoom entered the market at a much later stage but was very much planned with the focus on
products and the business model instead of pressuring the growth. Zoom, following the
development strategy process having three phases; first is market creating phase where the brand
develops on the products to be offered in the market, second is the sustaining phase where their
products are in a competitive market and brand works to have a bigger market share, third is the
efficiency phase where the brand concentrates on improving the volume of sales, is currently at
the sustainable stage. With their right products for the right market, Zoom has been able to
emerge as the industry leader more particularly during the Pandemic period. Some of the feature,
suggested by the users, that helped Zoom in becoming the most common video conferencing app
were-
● Zoom has been considered as user friendly. With the initial market limited to companies
and employees, Zoom enhanced their products to make them easy to use by various other
users like students, teachers, family members.
● Instead of relying on customers to pay for the smooth video experience in a virtual
environment, Zoom provides HD video conferencing on both freemium and subscription
models.
● With their low cost subscription model for premium features, Zoom has been able to
capture small and medium enterprises who are reluctant to purchase high cost products of
the incumbents
● Zoom recognised the need of its products to be integrated with other platforms for the
ease of their consumers and did some strategic integration with platforms like Slack,
Otter.ai.
Understanding how Zoom has disrupted the video conferencing industry, a few points can be
drawn from the current dynamics of the industry-
● Having user friendly products, Zoom has been able to add new users to the industry. With
over 100 millions of downloads from app stores, Zoom is delivering capability at a
previously unavailable level.
● Due to the Pandemic situation, Zoom has evolved as the most common platform for
holding meetings. This has even changed the entire perception of holding meetings by the
general public.
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● Zoom has features like webinar holding, screen sharing, screen remote control, chats,
phone accessibility, recording, which took the whole video conferencing to a different
level. Due to its enhanced products, Zoom has received appreciation from the existing
users in the industry or the incumbent's consumers.
● Bridging the gap of end-to-end encryption claims, the company laid its entire focus on
security issues. Headed by the former Facebook security leader Zoom acquired Keybase
(a prime security firm) to address the consumers security concerns.
● Skype has been changing for many years to adapt to its consumers and has lost its core
competencies required in the video conferencing industry. Zoom entered the industry
with its focus entirely on enhancing its products so virtual video conferencing could keep
pace with physical meeting rooms. This has also improved the value perceived by the
users.
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trying to use a bus to take the family to the shops as opposed to using the family car for the same.
Both will do the job but one will be more practical for simple tasks.
During the COVID-19 pandemic, the global population experienced a startling and accelerated
shift to remote jobs. That change, however, was never going to be entirely temporary. The
pandemic exacerbated a move toward flex work that had already begun in 2019. This predicted
transition begs the issue of how workers can interact while they are scattered and on the move.
What about connecting some new low-density offices or collaborating with field sales and
support personnel? Until now, a variety of visual, audio, and workspace applications have all
attempted to fill this vacuum. However, as the post-pandemic standard mode of operation takes
place, many companies will need to find a new approach that meets the varied needs of all of
their workers. For several industries, a centralised teamwork network, the most successful of
which is arguably Microsoft Teams, is the perfect option.Teams is a Chat-based communication
hub that allows for ad-hoc and planned sessions, as well as audio, video, and file sharing. Teams
are built on the concept of channels and can be expanded. From its inception, Microsoft has been
constantly upgrading offerings. As demand for robust communication platforms has exploded, a
slew of new features have been introduced across 2020 and into 2021. Zoom and Teams both
embrace online gatherings, chats, calls, screen sharing, and file sharing, among other functions.
The only distinction between the two is Microsoft's incorporation of Teams with its Office 365
suite. As a result, Microsoft Teams can truly serve as a one-stop shop for many businesses. In
addition, smooth sharing, copies, and file discovery are all possible. Zoom and Slack, on the
other hand, have a broad relationship and collection of strategic integrations, which helps to
round out Microsoft's Office365 integration. Zoom is a much smaller enterprise in contrast to
Microsoft, but it continues to thrive thanks to its ambitious roadmap and the fact that it doesn't
have to think about handling (and potentially migrating) a set of legacy on-premises clients.
Microsoft Teams and Zoom each have a free version of their platforms, with premium plans
offering more specialised features. Microsoft Teams provides restricted chat and teamwork,
productivity applications and facilities, meetings and calls, and encryption in its free version.
Administration capabilities and Microsoft support are two major features that the free version
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lacks. Zoom's free edition provides 100-person groups (with a 40-minute limit on group
meetings), open 1:1 meetings, remote support, as well as video and web conferencing, group
sharing, and security tools. Microsoft's Premium package is marginally less expensive per
customer than Zoom's equivalent Pro plan, but their business options are identical.
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● Interlinking Products to Connect Customers – Microsoft can easily leverage the wide
customer base using Windows Operating System and Microsoft Office. Through these
channels they can offer services and software that can help many more users to manage
and customize video and voice calls made through Teams. Moreover, they can provide
toolkits using which developers can easily create new add-ons and features for the app.
● Ensuring security along with collaboration – Many businesses still prefer using teams
over zoom due to the assurance of security that comes along with it. Microsoft should
ensure that it builds upon its competitive advantage to pace ahead of competitors. While
allowing third party collaboration and opening up the application for add-ons and
extensions, it should invest in ensuring a robust cyber security structure such that the
customer data is never at risk.
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● Cloud Hosting – Cloud computing gives users the freedom to easily schedule, record and
access relevant meeting recordings. Subscribing to cloud solutions gives users access to
automatic and hassle-free upgrades
● Integration with other Communication Modes – Although Skype provides users with
multiple options like messaging, voice calling and video calling. It can further improve
the collaborative space such that users can seamlessly switch in between devices, calls
while sharing files, projects across platform
● Smart Search – With the growing traffic on these apps, users must be provides with easy
option to search amongst the conversations using relevant keywords, and integrating use
of tags relevant to certain projects for accessing content
● Improving Visual Quality – Providing high quality video content as users access calls
through LED screens would hugely enhance customer experience. This may be further
expanded into VR space to provide life-like experience for attendees
● AI and NLP assistance – Extending the real time translations into AI driven suggestion,
combines with integrated features allowing users
c. Course of action for moving from one position to another on digital matrix
Among the three players on the vertical axis – tech entrepreneurs, digital giants and industry
incumbents, Microsoft is certainly an established digital giant. Among the three phases on the
horizontal axis, Microsoft is trying to transition from collision at the core phase to the
reinvention at the root phase. Collision at the core is the stage where new entrepreneurs and
technology challenges the traditional industry practices and the pre-existing rules of engagement.
Microsoft with its Skype and Microsoft Teams which was primarily targeted at the office going
audience, lies in this stage as Skype was a product which did not really change and did not bring
any new innovation which could have caused it to sustain. On the other hand, Microsoft, having
realised the limitations of Skype and in order to compete with Slack, introduced Microsoft
Teams but could not leverage on the opportunity. However, with the spread of Covid-19
pandemic, the world saw Zoom as the go-to video conferencing application. What was different
for Zoom was its simple user interface and the ability to make all the participants involved in the
meeting as if they were all in the same room together. This simplicity and its mobility on various
devices caused a disruption in the video-conferencing applications space and led to many new
players to adopt the same approach and same features in their platforms. Same is the case with
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Microsoft as it is trying to position its Microsoft Teams applications as the go-to application for
everyone be it school goes, families, diverse enthusiasts, college students and office goers. The
introduction of Zoom has caused the entire industry to look for various ways to reinvent
themselves as this mode of communication is here to stay. There are multiple other players like
Cisco web-ex, Google meets, Teamviewer, et al who are trying to compete in the same space as
Zoom by trying to emulate its features and business model while also trying to innovate on their
own to create a niche for themselves. Here, in this case, Skype was already a digital platform but
owing to its lack of innovation, it lost the audience’s attention and a new player like Zoom which
had gauged what was the need of the hour was able to capture the void in the video-conferencing
space. The move to the third quadrant focuses on finding solutions to consumers’ pain points and
fundamental issues faced by either individuals or companies. In order to transcend, finding
insights and applying them swiftly is essential, and so is the ability to adapt quickly to the
changes happening around. This is what is required from the side of Microsoft who needs to
acknowledge the shifts, take in what the new and old players in the industry are working on and
factor all that information into its product development process.
a. You are now planning to start a firm in this industry. Given the competition from
your chosen firm and other major competitors, how will you develop a business
model?
Supposing that the new application is named “Boom”, the model which will be followed is:
● Key Partners: These would include individual users, business, enterprises and investors.
Users here are stated in an all encompassing manner, i.e., a person for any sort of activity
wants to connect with other people is a potential partner.
● Key Activities: Developing and maintaining the software application/platform, making
software updates available, marketing and sales.
● Key Resources: Cloud data centres, infrastructure, engineering team, support and
maintenance team, sales staff, customer support staff, software codes & related IP rights.
● Cost Structure: Employees, office infrastructure, application infrastructure and marketing.
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● Value Proposition: The fundamental premise of the application would be that it allows its
users to connect one on one with each other via links or QR codes which can be shared
over any other application and the users can join the call on any device irrespective of
whether they have an account, or have the application installed. Easy to use, intuitive,
secure and simple interface are going to be essential features embedded in the
application. The platform will have multiple features like simultaneous chats, sharing of
screen, inbuilt whiteboard and notepad for participants, which would make the
interactions easier for the users. The application is to be made available on all platforms
like ios, Android, Windows OS, etc. An additional feature which will be added is creation
of virtual avatars of the participants which can be accessed via VR equipment.
● Customer Relationships: The ability to get feedback from users via ratings on app store,
proper FAQ section elaborating on probable doubts and customer support.
● Channels: Website, web-apps, mobile applications, virtual reality application.
● Customer Segments: Educational institutes, individuals, small and medium enterprises,
corporations, healthcare providers, government, financial services.
● Revenue Streams: The revenue model is a freemium service based model in which users
who want to avail features like increase the number of participants will need to subscribe
to a premium plan and those who want to avail additional features like ability to conduct
webinars, use VR avatars, customization for different industries, et al will be charged an
additional amount for the same.
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References:
[2] Wilson R. (2020). Here is how Zoom App Business Model is making money. Marketing Mind.
https://www.marketingmind.in/here-is-how-zoom-app-business-model-is-making-money/
[3] DGI. Zoom vs. Skype : A comparison of Video Conferencing Platform. DGI Communications.
https://www.dgicommunications.com/zoom-vs-skype/
[4] Chao J. (2013). Zoom aims to disrupt Video Conferencing Market. Enterprise Networking
Planet.
https://www.enterprisenetworkingplanet.com/unified_communications/zoom-aims-to-disrupt-vid
eo-conferencing-market.html
[6] Fortune Business Insights. (2020). Video Conferencing Market. Fortune Business Insights.
https://www.fortunebusinessinsights.com/industry-reports/video-conferencing-market-100293
[7] Wolfe E. (2019). The History of Video Conferencing from 1870 to Today. Lifesize.
https://www.lifesize.com/en/blog/history-of-video-conferencing/
[8] Yeramsetti S. Video Conferencing: Changing dynamics & technological innovation for
business. Dataquest.
https://www.dqindia.com/video-conferencing-changing-dynamics-technological-innovation-busi
ness/
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