In today’s trigger-happy investment culture when investors dump stocks and ask questions later, companies are holding more conference calls and webcasts beyond their traditional quarterly events. Those in the business of providing such services have seen an uptick in volume as IROs reassure investors in the wake of corporate scandals.
‘In this business climate where there is a general nervousness in the investment community, companies are communicating more with investors from an assurance standpoint,’ confirms Herb Piles, director of product management and development at InterCall.
On the day WorldCom announced the incredible $3.8 bn hole in profits, for example, ‘There was a tremendous increase in calls to discuss market conditions and to try and instill investor confidence,’ says Karen Verelley at New Jersey-based ECI.
Because companies are communicating more with investors and analysts throughout the quarter, and sometimes on very short notice, there has been more demand for reservationless conference call services, which let IROs call a number and set up a conference call without going through an operator.
‘Given the demand for companies to quell rumors and answers issues that are turning up in the Wall Street Journal every day, reservationless calls have become much more popular with IR professionals,’ notes Anthony Christie, senior VP of product management with Global Crossing, a company that has generated its own share of news.
Christie says a lot of companies use reservationless conference calls in combination with web conferencing for quick meetings with small groups of participants. Web conferencing differs from webcasting in that a presentation is uploaded to a secure web site rather than streamed over the internet.
Companies are also adding collaborative elements to web conferences that allow users to share applications online. ‘Collaboration has gotten a lot easier to use as technology has improved and people move to cable and DSL [internet connections],’ notes Bruce Laughrey, president of TelSpan. He adds that these broadband connections make video more practical, too, perhaps for showing off new products or management.
With web collaboration, meeting participants can work on the same document even though they’re in different locations. This can work well for virtual one-on-ones, which are more widespread because travel has been curtailed since 9/11. As Laughrey points out, ‘If an analyst asks you what your story will look like if sales increase by x in the next quarter, you just plug in that number in an Excel spreadsheet and have a really dynamic discussion.’
‘There are multiple applications for web collaboration,’ adds ECI’s Verelley. PR and IR departments often use it internally to prepare for a meeting. ‘Everyone can look at the slides at the same time and enter data and edit on their own desktops,’ she says. Obviously, security is a big concern when sharing certain documents over the web. Verelley offers reassurance: when ‘The security is tight; there is encryption and we provide a reference number for each meeting that is never used again.’
Dual revolution
The world of virtual conferencing is moving in two directions, according to InterCall’s Piles: ‘On one side you have the reservationless, unattended conferences done through automation, and on the other side you have the large event meetings.’
Today there are lots of add-ons designed to give IR teams more confidence during event calls like quarterly earnings presentations. Pre-registration, real-time polling, participant lists and replay features are just some of the features now available.
Some conferencing firms are expanding into virtual roadshows and investor presentations. This month, San Francisco-based ON24 will launch its virtual investment banking conference service. ‘Instead of meeting at a hotel, an investment bank will host a virtual conference where companies will present their stories online,’ explains Reza Musavi, director of financial services for ON24. ‘The advantage for IROs is twofold: they don’t have to travel to each conference to present, and they can potentially reach a much broader audience online,’ he says.
Virtual conferencing is clearly becoming faster, easier, and cheaper by the day. Take Citizens Conferencing, for example, which recently added a toll-free service for international participants in 15 countries to dial in and participate in conference calls without paying long-distance charges. If the conferencing industry keeps innovating at this speed, IROs will soon find themselves chained to their desktops, permanently.
