Firms say they're shaking up stodgy video technology

The lesson on Paul Revere's ride had gone over well, Ana Holland thought, when a little boy in the corner of the room raised his hand.

"Yes, Sam, what was your question?" Holland asked. The 25 students fell silent, momentarily stunned.

The students could see Holland, whose life-size image seemed to float in the air of their room on South Padre Island.

But they hadn't considered that she could see them on a huge TV monitor in her classroom at Derry Elementary School, three miles away on the Texas mainland.

Holland's class was using a new videoconferencing system that projects an image on a large sheet of glass instead of a TV screen. When the room lights are dim enough, the image appears almost like a three-dimensional hologram.

"This we believe is the next level of communication. The only thing you can't do is press the flesh," beams Dave Booth, chief operating officer of Teleportec, a Dallas-based company that produced the school's equipment.

Videoconferencing has been around for years, as have complaints about its limitations, especially the sense that you're watching someone on TV instead of meeting with them. There is often an unnatural delay in the sound that prevents natural conversation.

Now, driven in part by businesspeoples' post-Sept. 11 reluctance to travel by air, Teleportec and a handful of other companies are marketing systems with a different look.

Teliris, a U.S.-UK joint venture, uses several cameras and screens to recreate the feeling of a board meeting. One of its first customers, publishing company Pearson Group PLC, used the system when the halting of flights just after Sept. 11 forced several New York-based executives to miss a London meeting.

"It's nearly as good as being there, which the earlier generations of videoconferencing were not," says David Bell, chairman of Pearson's Financial Times. "You can wink at somebody on the other side of the Atlantic and they'll see you wink."

Teleportec, with 20 employees, launched U.S. sales this year. Its customers have included Electronic Data Systems Corp. and Nortel. It also sells hourly rentals in a handful of cities.

High-speed Internet access has made it possible to transmit better pictures and sound. To do the job, Teleportec combines ISDN or T1 lines with software that compresses and decompresses video and audio data.

Vaguely 3D

The company's key innovation is projecting images on a thick sheet of glass embedded with light-reflecting particles. The thickness of the glass gives the image a vaguely three-dimensional quality, more lifelike than a picture on a TV screen.

Like other manufacturers, Teleportec has also added the ability to overlay graphics presentations.

The greater sophistication is accompanied by heftier price tags.

Basic systems from longtime videoconferencing companies run $10,000 to $50,000, but advanced systems from the new players can cost upward of $250,000. Rental fees are typically $200 to $300 per hour.

Research firm Frost and Sullivan predicts videoconferencing will grow rapidly by reaching into the middle ranks of companies instead of just being a toy of top executives, and big technology companies are getting interested.