Should Cisco Stay Out of the Living Room?
As Cisco Systems gears up to launch a range of consumer electronics for the home, some industry pundits think the networking giant’s consumer focus will fail miserably. GigaOm calls it a “misguided foray into the living room.” On the contrary, The VAR Guy thinks Cisco would be foolish to ignore consumers. Here’s why.
Fact is, consumers — rather than corporations — increasingly drive the future of IT. And a growing list of “corporate” IT solutions (such as TelePresence) leverage PC economics, which means their prices fall by half every 12 to 18 months.
Cisco can either embrace consumer IT, or get destroyed by it. Consider the following:
- TelePresence — a.k.a. next-generation video conferencing — is coming to the living room. And VARs increasingly target consumer-based IT services, notes the OnForce Services Marketplace Index, which tracks IT engagements across the United States.
- Sure, Cisco spent a hefty $500 million on Linksys. But can you think of a stronger home and small business network product line? GigaOm accurately notes Cisco’s addiction to fat enterprise product margins. But Linksys has taught Cisco quite a lot about consumer pricing, thin margins, retail shelf space and discount bins.
- Digital media — movies, music and whatever’s next — requires hefty bandwidth. If Cisco helps home users consume more bandwidth, service providers will be forced to upgrade their infrastructure. Anybody else see a clear bandwidth connection between Cisco’s consumer end-point strategy and Cisco’s enterprise-class router (the ASR 9000)?
Will Cisco’s consumer strategy succeed? It’s far too early to say. But ignoring consumers — the folks who are driving the future of IT — would be foolish.
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I think it all depends on how Cisco handles things. They’re a big corporation with tentacles in pretty much everything. They could become just another Microsoft. On the other hand they have their customised Linux powered network switch/server hybrid thingies. Imagine something like that built into your 52″ HD TV? Cisco being pretty good at networking could be just what consumers need to finally get us all this on-demand content we’ve been told we’ve been demanding for the past two decades.
As a network engineer that’s been certified and using cisco solutions for over 10 years I have seen this company pull off some pretty lofty accomplishments (VoIP). When cisco begin their foray into voice everyone balked and now they have one of the largest and most stable VoIP platforms available. But VoIP made sense for them due to the network backbone they practically own.
Cisco is notorious, however, for poor user interface design and software design….they love the command line….as such, people find their products difficult to implement and understand.
So if they plan to go into the living room….I do hope they plan to improve greatly in how they communicate to the non-engineer types and the home user. If they can do this, they have some amazing things up their sleeve that I saw demonstrated at Networkers 2007….such as the ability to have your home music collection (digital of course) and photos follow you to a hotel room…..so when you arrive in your room….there’s your music playing and your photos being displayed…..
I predict that any high-end consumer products will not sell very well in the future. When money becomes tight, luxury goods are the first to go. If Cisco can make a competitive product at a low price point, then they have a good chance at being successful.
Here is why I think money will become tight:
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I agree with the last comment that Cisco should be guided by the following: to make the necessary home consumer electronics and it’ll automatically get in “the living room”. Moreover, the strong desire is the half of the work, so adding on also the action….keep on going!!!!
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