Cisco announced today that it is restructuring its consumer line of products and closing down the Flip business.  R.I.P Flip, it appears.  The Twitter is alive with the sound of people commenting about this move, ranging from “Wait…what?” to what I think are the sounds of champagne corks popping and party music popping up all over.  To many of my peers, Flip represented all that was wrong with Cisco’s decision to get in front of a new perceived market transition toward consumerization and video.  By chasing the golden calf of Flip, Cisco deserted their core business and alienated customers towards alternatives, such as HP and Juniper, or so this line of thinking goes.  These people will now point to the retirement of the Flip brand and say that they were right and that Cisco needs to kill off the other consumer products and get back to what the do best: moving packets around as fast as possible.  Not the Flip was entirely bad.  It made for a great line of door prizes to be handed out by Cisco people at the events I attended.

I’m going to take a slightly different line of reasoning here.  I don’t think Cisco failed with the Flip.  I don’t consider something to be a failure so long as you learned something from it.  Apollo 13 wasn’t a failed moon landing.  It was a successful astronaut rescue.  We learned how to think on the fly when the pressure was on and bring people home safely when it counted.  In a slightly different way, I think Cisco learned a lot about what went wrong with the Flip and dissecting it over the coming months should yield a lot of information about how to avoid things like this in the future.

– Consumers don’t care about gadgets. Bold statement from someone that has both Fruit Company Mobile devices on his desk, right?  Funny thing about consumers is that they don’t really want a separate phone, still camera, video camera, and GPS receiver in their pocket.  If they can get all that functionality in one device, they’ll do it.  Even if it means that they won’t have the Super Whiz-bang 1080pqrstu Video.  I still have an iPhone 3GS, which was the first model to include video.  I don’t use the video camera all that much, only in cases where it’s convenient.  Others tend to use the video camera for anything and everything.  I don’t own a separate GPS receiver, I use Google Maps on my phone.  I don’t carry a point-and-shoot camera any more, I use my phone.  The ubiquity of having a video camera built into your phone has really hurt the low-end fixed-focus video market.  Not just Flip, but Kodak and others have really been pinched because people are now looking at buying a $200 video camera and saying to themselves “Why bother?  I’ve already got one on my phone that works almost as well.”  I figured Flip was headed for hard times when I saw many of the HD models on sale at deep discounts at my local office supply store.  Reducing inventory means they aren’t flying off the shelves like you wanted.

– Consumers want to do something with content. Once upon a time, people used to shoot video of their kids and then copy the tape and send it to Grandma and Grandpa for hours of watching over and over again.  Now, we just post it all to Youtube/Vimeo/Facebook and tell Grandma to check it out there.  In a world where Cisco says everyone wants video, people tend to fall back on these outlets to let the world know about what you have to say.  I do it myself.  My kids riding a bike for the first time? Facebook.  My first ride on a Segway? Youtube.  My IPv6 Presentation? Vimeo.  I want to share things with people.  Rather than coming up with a new and unique hardware device to capture these moments, what Cisco needs to do is focus on a way to expedite sharing this content.  Other than having a button that says “Upload to Youtube”, do you know how hard it is to get video off of a Fruit Company Mobile Device?  Not that easy.  iMovie exists to edit videos on these devices because they are such a captive platform.  Once you’ve edited the movie how you’d like it, you just upload it to the content aggregator of choice.  Imagine, though, that you want to share this content with someone and not necessarily have to send them to Youtube.  That’s where Cisco Digital Media Manager needs to come more into play.  By allowing consumers to upload content to a…cloud-based version that can then be pushed down to a local digital signage endpoint.  Think of a school where users want to take video of a football game or a band concert and make short clips available at signage endpoints in the common areas.  How would you do that seemlessly today?  You’d have to force people to go to Youtube and play the video instead of making it instantly available at their fingertips.  Concentrate on writing the middleware to make the sharing process invisible to users, and I promise you’ll make more money than you would with another hardware device.

– People want to use hardware as they want. This is probably the biggest gripe about Flip to me.  Shop the Flip accessories page (while you can).  What do you find?  Cables and tripods and image designers to make skins for your camera.  Where’s the external Bluetooth microphone so my presentations don’t sound like they’re in a tin can?  How about different lens options besides the single wide-angle one?  How about a wireless option to allow me to NOT have to plug my camera in every time I want to offload a video or I simply want to upload it to Youtube?  That last one is where the Flip really missed the boat.  People constantly complain that Apple won’t allow them to wirelessly sync their Mobile Devices.  They would much prefer just hitting a button once you were within range to synchronize everything.  Now think about the Flip.  If I want to upload the cute video of my kids being chased by the AFLAC duck, I need to break out my laptop, download the video from my camera, find a wireless hotspot, and then upload that video to Youtube.  How would I do that on my phone?  Take video, push “Upload to Youtube”, done.  Quick and easy.  I didn’t need to think about how to accomplish the task, I just did it and let the hardware sort it out.  I have no doubt that Cisco would have eventually released a wireless Flip.  And I would have loved to have bought one.  It would have allowed me much more freedom to do things I wanted with my videos.

Tom’s Take

The Flip ultimately didn’t fail.  In my mind, the umi was a much bigger failure in terms of R&D-to-revenue.  Flip taught Cisco that the consumer market is a dog-eat-dog world of products made by the lowest bidder and people too focused on getting the most bang for their buck to care about cutesy things like graphics skins.  A few years ago, the Flip might have succeeded to the point of driving a different kind of video revolution.  Instead, Cisco tried to jump ahead of the transition and guessed wrong.  Rather than trying to provide the hardware to drive the transition, create the software to take advantage of it.  Integration is more important that manufacturing.  Think about the coup you could pull off if you could integrate Apple Facetime with CUCM or Telepresence.  That’s where Cisco needs to be headed, not to plastic video cameras.  Just as long as Cisco learns from what happened with Flip, it will never truly be a failure.