Tuesday, April 12, 2011

Cisco Kills The Flip Cam

I have always been intrigued by the idea of the Flip Cam.  The idea of trying to get a video cam into the hands of as many people as possible in the days of Youtube fame and fail is awesome! Yet alas, who was to know those days would be numbered.

Cisco Systems bought the Flips creators, Pure Digital in the Spring of 2009 with the plan to flood the market with entry cost digital video cameras.  Yet now Cisco sees it necessary to refocus primarily do to the abundance of smartphones and even prepaid phones with cameras.

Hit the Jump for the Official Press Release 

Cisco Restructures Consumer Business

SAN JOSE, CA--(Marketwire - April 12, 2011) - As part of the company's comprehensive plan to align its operations, Cisco (NASDAQ: CSCO) today announced that it will exit aspects of its consumer businesses and realign the remaining consumer business to support four of its five key company priorities -- core routing, switching and services; collaboration; architectures; and video. As part of its plan, Cisco will:

* Close down its Flip business and support current FlipShare customers and partners with a transition plan.
* Refocus Cisco's Home Networking business for greater profitability and connection to the company's core networking infrastructure as the network expands into a video platform in the home. These industry-leading products will continue to be available through retail channels.
* Integrate Cisco umi into the company's Business TelePresence product line and operate through an enterprise and service provider go-to-market model, consistent with existing business TelePresence efforts.
* Assess core video technology integration of Cisco's Eos media solutions business or other market opportunities for this business.

"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."

In connection with the changes to the consumer business, it is anticipated that Cisco will recognize restructuring charges to its GAAP financial results, with an aggregate pre-tax impact not expected to exceed $300 million during the third and fourth quarters of fiscal 2011. The charges will be disclosed in upcoming earnings conference calls and quarterly Form 10-Q filings. Additionally, the company expects this will result in a reduction of approximately 550 employees in the fourth quarter of fiscal 2011.

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