Best Way to Video-Conference: No Pictures

THIRTY years after AT&T displayed its video telephone at the New York World's Fair, the rest of the country is beginning to catch on. Everyone, it seems, wants to get into the video-conferencing business.

Telecommunications and computer companies are rushing to build devices to connect callers' images to their voices. Even Intel Corporation, which makes the chips that run most personal computers, last week announced two new video conferencing products. The technology is evolving quickly from special video-conference rooms to roll-around units the size of a TV set. Now, computer companies promise to bring video communications to anybody who owns a desktop computer.

But hold onto your fax machine. The future isn't here yet.

``It's really not going to happen till 1996,'' says Paul Callahan, a senior analyst with Forrester Research in Cambridge, Mass. ``I don't think anybody's going to make any money for another 18 months to two years.''

One reason is that, like the original phone systems, not all video-conferencing systems can talk to one another. Several companies support a standard known as H.320, which allows their machines to share video but not documents generated by a personal computer (PC). But Intel's new ProShare Personal Conferencing products run on a different standard, confusing matters. ``They've set the industry back about three years,'' grumbles one competitor.

Nevertheless, Intel is lining up some impressive industry support. Large telecommunications companies such as AT&T and several of the regional Bell companies will jointly market a digital telephone service with Intel's ProShare products. Several software companies, including Lotus Development, Microsoft, and Novell, have announced their interest in developing ProShare-compatible products. And computer manufacturers like Compaq and Dell intend to ensure their PCs support ProShare.

``By the year 2000, every personal computer ... every single one of them, becomes a data-audio-video-conferencing system,'' says Pat Gelsinger, vice president and general manager of Intel's personal conferencing division. ``That's our goal.''

Analysts agree that the goal may be overambitious. Even though prices have fallen dramatically - a $120,000 TV-type unit in 1986 now costs under $20,000 - it is still too high for most PC users. Even the latest video-conferencing systems for PCs cost as much or more than the PCs themselves.

``Prices have generally come down 30 to 50 percent a year,'' says Joan Nevins, vice president of finances and administration for PictureTel Corporation in Danvers, Mass. But for PC users, ``the price points have to get significantly lower.''

Furthermore, the video on all the PC systems is jerky unless users invest in high-grade digital telephone service. Users ``are expecting television quality or better and what they're getting is Max Headroom or less,'' says Robert Calis, president of EyeTel Technologies Inc., based in Vancouver.

The first users of the technology may opt to skip the video portion of desktop video-conferencing. Mark Slamowitz, a Portland, Ore., chip designer, uses the ShowMe 2.0 desktop system to show off his designs to a client in California. He chooses not to use the video hookup that ShowMe, a product of the SunSolutions unit of Sun Microsystems Inc., provides. Instead, Mr. Slamowitz brings up his designs on-screen so he and his client can draw in the changes in real time while they talk on a second telephone line.

``This saves me six to eight flights a year,'' he says. ``Some of the people in the organization feel very uncomfortable not being able to see me. [But] most of the people I work with ... don't care.''

Both EyeTel and Intel sell a $99 software package that allows real-time document sharing. Some skeptics think that this is as far as the technology is likely to go. Users will share data, not video of themselves, they say.

``I think people will resist the video phone,'' says Brian Stonehill, director of the Media Studies program at Pomona College in Claremont, Calif. ``It demands too much of you.... You're going to have to be your best because you're `on.' ''

AT&T, which introduced its VideoPhone 2500 in 1992, reportedly has sold only about 25,000 units, analysts point out.

``The least important is the video,'' agrees Richard Bruce, president of Xerox Group Communications in Palo Alto, Calif. The company, which specializes in group teleconferencing, has found in its research that audio is the most important component of business conferences followed by data.

But ``without that visual understanding of the group, it's more difficult to be persuasive and clear and to know you're really understood,'' he adds.