Cisco kills its Apple competitors Flip, Eos, Umi to focus on networking

Posted:
in iPod + iTunes + AppleTV edited January 2014
Cisco announced plans get out of the consumer business apart from its Linksys networking products, killing its Flip handheld camcorders, Eos social media platform and Umi consumer video conferencing device.



Cisco kills Flip, writes off $590 million



Cisco paid $590 million for Flip maker Pure Digital just two years ago, but the popular, easy to use digital camcorders were effectively squeezed out of a market by smartphones with good enough video recording skills on the low end, and point and shoot cameras with superior video recording.



Just after Cisco bought Flip, Apple's chief executive Steve Jobs unveiled the iPod nano with its built in video camera, and noted that while a 4GB Flip costs $149, the new 8GB nano would sell for the same price and include a "free" video camera with its iPod functions in a much smaller package.







Cisco responded with a tweet saying it was flattered by Apple's imitation.



Last year's iPhone 4 subsequently boosted its video capture quality dramatically, while adding still camera shots that Flip cameras are not designed to capture. The iPhone, and similar smartphones, also make it easy to share pictures and videos instantly via MMS, FaceBook or email.



As part of a restructuring to focus on its core networking business, Cisco announced it would shutter its Flip business and lay off 550 employees.



Looking for ways to recycle Eos, Umi



The company will also be "reevaluating" how it can make use of Eos, an internally developed social network service platform oriented to help media and entertainment companies to build an audience (independently of iTunes).



A third Cisco product, Umi telepresence, originally aimed at bringing an alternative to Apple's iChat video to consumers. The device cost about $500 and connected to the user's television. It will now, like Eos, be folded into the company's business plans. Apple has focused on video chat both in iChat for desktop systems, as well as its new FaceTime feature released with iPhone 4 and subsequently expanded to the iPod touch, iPad 2, and Mac.







Cisco's restructuring didn't mention Cius, the company's 7 inch iPad-like Android-based tablet aimed at video conferencing and business users, but the pre-Honeycomb device hasn't seen much attention since its initial announcement.







?We are making key, targeted moves as we align operations in support of our network-centric platform strategy,? said John Chambers, Cisco chairman and CEO. ?As we move forward, our consumer efforts will focus on how we help our enterprise and service provider customers optimize and expand their offerings for consumers, and help ensure the network?s ability to deliver on those offerings.?
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Comments

  • Reply 1 of 43
    The carnage that M$ and others (here, Cisco) render unto their bottom lines in pursuit of the general and gaming consumer is simply staggering. I wonder when shareholders and the investment glitterati are going to get upset. Its really surprising to just drop $590M, but I reckon they are trying not to throw good money after bad.



    Oh, well...
  • Reply 2 of 43
    It really irks me when ads show video calling with people looking at each other, it is so not possible with the camera positioning.



    ..let alone the pasted in photo pretending to show call quality.



    Some American needs to class action false advertising across all video call providers.
  • Reply 3 of 43
    nasseraenasserae Posts: 3,158member
    In few years no one will buy Point & Shoot cameras. There will be phone cameras & DSLRs. When I had my iPhone 3G I was looking at cameras with location geotagging because I love this feature in iPhoto 09 and how it organizes my photo. The cheapest one that work (sometimes) was at least $300. I decided no way. I will keep using my iPhone 3G even if the camera wasn't as good. Now with improved phone camera quality, and I don't mean in term of MP, I don't see any reason to bother with a dedicated camera that isn't a DSLR.
  • Reply 4 of 43
    neiltc13neiltc13 Posts: 182member
    Apple doesn't make a video camera.



    Apple doesn't make a video conferencing device.



    Apple doesn't make a social network.



    Remind us all again what this has to do with Apple?
  • Reply 5 of 43
    Quote:
    Originally Posted by cy_starkman View Post


    It really irks me when ads show video calling with people looking at each other, it is so not possible with the camera positioning.



    ..let alone the pasted in photo pretending to show call quality.



    Some American needs to class action false advertising across all video call providers.



    Speaking re. the Apple ads, I would assume that the company would be smart enough to not pass off 'simulated' images as the real thing.
  • Reply 6 of 43
    filburtfilburt Posts: 398member
    Cisco probably bought Pure Digital (of Flip) and Linksys to gain better understanding of B2C market, but B2C just isn't in Cisco's genetics (at least under John Chamber).



    Cisco launching umi at $599 and $24.95/month subscription highlights just how out of touch the company is with consumers (it releasing cheaper product last month at $399 and $8.25/month demonstrates it hasn't learned a bit).



    And I am not sure if Cisco should try to expand into B2C. Juniper and others have taken a substantial share of Cisco's core business (e.g., router) and it is questionable as to whether video conferencing is a field that will remain high-end.
  • Reply 7 of 43
    kwoot27kwoot27 Posts: 30member
    Disappointed in seeing Cisco abandon the Flip. The video quality is amazing. They just needed to get with the social aspect of the device in order to make it more appealing. Not everone owns or needs a smart phone. Flip is an awesome video recorder...thats all it needed to be.
  • Reply 8 of 43
    lkrupplkrupp Posts: 7,308member
    Staggering carnage inflicted by Apple on some really big name companies. They all stared at the ceiling when Apple went after the various markets they controlled by inventing new markets and new products, or reinventing failed products others had attempted. Once the Apple juggernaut started rolling they all looked like deer in the headlights and began flailing about to play the copy/catch game. The iPod, iPhone, and now the iPad have turned a lot of the paradigms upside down. Cisco thought it could buy its way into the consumer market with Flip but the iPod and the iPhone put a bullet in its temple. From Nokia to RIM, from Cisco to Nintendo they have all felt the Apple Effect and it ain't a pretty sight. Who would have thought this would happen when Jobs came back? Not me, for one.
  • Reply 9 of 43
    Quote:
    Originally Posted by lkrupp View Post


    Staggering carnage inflicted by Apple on some really big name companies. They all stared at the ceiling when Apple went after the various markets they controlled by inventing new markets and new products, or reinventing failed products others had attempted. Once the Apple juggernaut started rolling they all looked like deer in the headlights and began flailing about to play the copy/catch game. The iPod, iPhone, and now the iPad have turned a lot of the paradigms upside down. Cisco thought it could buy its way into the consumer market with Flip but the iPod and the iPhone put a bullet in its temple. From Nokia to RIM, from Cisco to Nintendo they have all felt the Apple Effect and it ain't a pretty sight. Who would have thought this would happen when Jobs came back? Not me, for one.



    What a great post. The Apple Effect. You could add: the entire music industry, the entire mobile telecom industry, the entire netbooks industry, and soon, the entire tv and movie industries.
  • Reply 10 of 43
    lkrupplkrupp Posts: 7,308member
    Quote:
    Originally Posted by neiltc13 View Post


    Apple doesn't make a video camera.



    The iPod Touch, the iPhone, the iPad



    Quote:

    Apple doesn't make a video conferencing device.



    The iPhone, iPod,the iPad and now Mac w/Facetime



    Quote:

    Apple doesn't make a social network.



    iTunes



    Quote:

    Remind us all again what this has to do with Apple?



    Just did.
  • Reply 11 of 43
    dualiedualie Posts: 333member
    Great, now maybe it can focus on improving its terrible customer service.
  • Reply 12 of 43
    Other cell phone makers had cameras before the iPhone and iPod Touch. It's not just Apple products that made Cisco change its mind.



    It is a bit sad that companies just drop manufacturing good products because they aren't earning the gigantic profits that they want. Flip video cameras are a great product and the company is viable as it is. It doesn't need to be closed down just because some CEO who made a bad decision feels the need to make another bad decision.



    I don't own a cell phone and might not ever own one. I like my Flip camera from the second generation. It could be improved and made more desirable. It could be thinner and lighter with more features. IPods and iPhones don't have zoom controls or microphone inputs. They don't have tripod mounting points. Small dedicated video cameras are great tools.



    Cisco should consider the real competition of the Flip video cameras as higher end dedicated video recorders made by Sony and Panasonic, not the smart phone people. Flip cameras with more features would take away market share from the higher end cameras. Their business would have plenty of room to grow if they would continue innovation in the inexpensive video camera market.



    They could add cheaper flash memory, better lenses, greater resolution, more connectivity options, and better software. I hope somebody buys the Flip Video company instead of Cisco just dumping it. Perhaps this announcement will bring interested parties to Cisco who will offer to buy it. That would be more profitable than just closing the business. Any child would tell you that getting some money for something is better than getting no money for something and throwing it away. The Cisco CEO needs to be fired pronto.
  • Reply 13 of 43
    robin huberrobin huber Posts: 3,288member
    Quote:
    Originally Posted by NasserAE View Post


    In few years no one will buy Point & Shoot cameras. There will be phone cameras & DSLRs. When I had my iPhone 3G I was looking at cameras with location geotagging because I love this feature in iPhoto 09 and how it organizes my photo. The cheapest one that work (sometimes) was at least $300. I decided no way. I will keep using my iPhone 3G even if the camera wasn't as good. Now with improved phone camera quality, and I don't mean in term of MP, I don't see any reason to bother with a dedicated camera that isn't a DSLR.



    I went through exactly the same process. What I ended of doing was buying an Eye-Fi card for my existing point-and-shoot under the impression that geotagging was included. Then I got my iPhone 4 and found the video and pics as good or better as those on my Canon point-and-shoot. Now the Canon and it's card gather dust. Just got back from two weeks in Colombia South America where I shot everything on the 4. Beautiful. Doubt I'll ever buy a digital SLR as I'm just not into all that the settings and photography geekery. My old analog SLR has been in the closet for a decade or more.
  • Reply 14 of 43
    rhyderhyde Posts: 294member
    Quote:
    Originally Posted by neiltc13 View Post


    Apple doesn't make a video camera.



    Apple doesn't make a standalone video camera.

    There, fixed that for you.



    Quote:

    Apple doesn't make a video conferencing device.



    Apple doesn't make a standalone video conferencing device.

    There fixed that for you.



    Quote:

    Apple doesn't make a social network.



    Beyond fixing. How about ping?

    Okay, let's try:

    Apple doesn't make a hugely successful social network. :-)



    Quote:

    Remind us all again what this has to do with Apple?



    It's reminding us how Apple is kicking everyone else's butt :-)
  • Reply 15 of 43
    docno42docno42 Posts: 3,326member
    Wow, I assumed Flip was getting hammered by smart phones, but this is pretty significant in Cisco deciding to kill it!
  • Reply 16 of 43
    docno42docno42 Posts: 3,326member
    Quote:
    Originally Posted by neiltc13 View Post


    Remind us all again what this has to do with Apple?



    iOS killed all three because the iPhone, iPod Touch and iPad 2 (along with other similar devices) supplanted them?



    Pretty obvious linkage to me...
  • Reply 17 of 43
    docno42docno42 Posts: 3,326member
    Quote:
    Originally Posted by Smallwheels View Post


    Other cell phone makers had cameras before the iPhone and iPod Touch. It's not just Apple products that made Cisco change its mind.



    I disagree. I think it is exactly Apple products that made Cisco change it's mind. The iPhone 4 was the highest quality sensor and the most widely deployed (yes, there was some obscure Nokia model that had a better sensor, but it didn't go anywhere sales wise so it basically doesn't exist). Couple that with Apple's ecosystem that made using and sharing video and photo's easy enough for mere mortals, and that was more than enough to topple the likes of Flip.



    Sure, other phones and devices had similar features, but none had the right mix of features to actually supplant sales of devices like the Flip camcorders. I know my local Costco had stacks and stacks of them left over after Christmas this year - and 80% of that was easily attributable to the iPhone 4.
  • Reply 18 of 43
    Quote:
    Originally Posted by dualie View Post


    Great, now maybe it can focus on improving its terrible customer service.



    Not a chance.
  • Reply 19 of 43
    docno42docno42 Posts: 3,326member
    Quote:
    Originally Posted by Suddenly Newton View Post


    Not a chance.



    Hehe... would be counter culture for them.



    Found one of these in a storeroom I was helping clean out a few years back. We plugged it in and it fired right up. Thing was built like a tank. The fan in it was ruffling papers on a desk 20 feet away on the other side of the room! I wonder what happened to it - probably lost in the surplus property system somewhere...
  • Reply 20 of 43
    rkrickrkrick Posts: 66member
    Quote:
    Originally Posted by NasserAE View Post


    In few years no one will buy Point & Shoot cameras. There will be phone cameras & DSLRs. When I had my iPhone 3G I was looking at cameras with location geotagging because I love this feature in iPhoto 09 and how it organizes my photo. The cheapest one that work (sometimes) was at least $300. I decided no way. I will keep using my iPhone 3G even if the camera wasn't as good. Now with improved phone camera quality, and I don't mean in term of MP, I don't see any reason to bother with a dedicated camera that isn't a DSLR.



    I seriously doubt that point and shoot cameras will fade away. I personally own a DSLR, a point and shoot and an iPhone and can say that in most cases the point and shoot is the best choice overall. While my DSLR takes the best pictures in every situation it is not nearly as easy to set-up or portable enough to carry around all the time. I agree that in a pinch a cellphone camera is better than none at all and I always have it with me, but there are many situations where the photo quality is barely acceptable. I know that they are getting better all the time but the major problem with cell phone cameras is not the megapixel factor, which is only one important factor to get decent pictures, but that the lens itself is not large enough to let in enough light in most cases (e.g. sunset, outdoors in low light situations, action shots, etc.). Another issue is that they only have digital zoom which is no where even close to the quality you get from optical zoom. On the other hand my Lumix point and shoot, 12 MP 16X optical zoom (24mm - 384mm) and GPS is not generally a problem at all to carry with me to events or on family vacations as it fits in my shirt pocket, and it takes awesome photos which in many cases rival the picture quality I get with my DSLR. I don't believe that cellphones will ever have large enough lens, to let in enough light, or optical zoom capability to replace point and shoots, even if they increase the megapixels exponentially it will only yield millions of crappy pixels.
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