SM: Sounds like an early version of WebEx!
BH: It was a little different since WebEx is sharing files on a PC and this was displaying it in a conference room. WebEx was also a lot more successful than we were with that device. The audio conferencing grew and the company was profitable.
SM: You were already running the company, right?
BH: I joined in January of 1997.
SM: What was the revenue of Polycom at the time?
BH: I believe it was $37M.
SM: It was all audio conferencing?
BH: It was primarily audio conferencing.
SM: Take us through the history of your tenure there.
BH: I was on board and we debated what we should do. There are obviously lots of paths you can take. The idea was that we would get into voice, video and data. The next obvious move was to take the data solution, which was OK, but we really felt that we should try video. We linked up with one of our VCs, and they had invested in a small startup in Austin, Texas. The VCs were Oak and Accel. It was not much.
Meanwhile, we had a whiteboard with an idea. We had our founder, Brian Hinman, who was also the founder of PictureTel, and we had various PictureTel people around the company. We took a bunch of our senior people who had video experience and sent them down to Austin. They fleshed out the idea with the founders of the startup down there, and crafted an idea of the product family and how it should all look. It was a really wonderful thing because the architecture was designed correctly from the start.
Some of the people from PictureTel who were not happy with the direction PictureTel had gone, and knew how they would have done it the right way if they had another chance, were with us and were mixing their ideas in with the Austin team.
They came out with a great product line called ViewStation. That ramped the company into two product lines. The data product faded on its own. It was not resonating with the customers. It was too clunky, and people were moving to the Internet and the web. It made logical sense that it would fade away and we became a video-audio company. Since then we have made eleven acquisitions.
We moved into the infrastructure side in order to deliver a complete solution. We also moved very early into voice over IP. We took a lot of bumps and bruises early on with VoIP and now we are the leading provider of VoIP phones for independent call solutions. You can buy a big solution from Cisco or Avaya, but there are a lot of small people out there with creative, wonderful solutions who have bought into standards. One of the things we really drove was SIP; we believed in the SIP protocol. We backed SIP all the way. We have a complete line of SIP phones, probably the most complete line. We offer everything from wireless devices to single mode wi-fi, all the way through conference phones, handsets, and we put our little Polycom spin into it. Not only do we have all of the protocols that allows us to integrate with our 25 partners, we have the great Polycom speaker sound. We have Hi Def Voice.