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Cisco acquisition could pave way for a Wi-Fi Flip

imageAt Technologizer, Harry McCracken, again showing that he is the king of context when it comes to tech blogging, cleverly compares Cisco’s acquisition of Pure Digital and the almost fatal acquisition of Palm Computing by US Robotics shortly before USR’s own purchase by 3Com. I’d argue that in some ways there was more obvious synergy between a networking company and Palm, which would eventually morph into a smartphone company, and Cisco/Pure Digital. Clearly Cisco is striving to establish its brand in the consumer market, and the relatively inexpensive Flip gives it a means of low-priced video acquisition on which to stamp its bridge logo and feed its new NAS (that seems to have a bigger LCD than the Flip!).

This is an interesting time for the category as we are clearly starting to see more blurring between these low-cost flash-based units that have traditionally sold for less than $200 and higher-end flash camcorders that have traditionally sold for more than $500, but that is to be expected as the future of the camcorder is undoubtedly flash memory. For example, while the Flip and the Kodak Zi6 lack an optical zoom, the new Sony Webbie has a 5x optical zoom. As these large-scale manufacturers companies take better advantage of the lower price and smaller size that flash memory increasingly makes easier to enable, Pure Digital may have timed its exit perfectly

Pure Digital originally sought to use disposable camcorders to drive a DVD processing business for drug stores and mass merchants. It may be a good example of what a company can gain when its products become targets for hackers, who had found a way to get video from its original products. This may have helped the company understand the potential for an inexpensive camcorder aimed at moms first and YouTubers (who understand more options for capturing video) second. There are certainly some Apple-like aspects to its products’ designs – minimalism, simplicity, and integrated software, and smallness. (However,  I think an Apple camcorder would either have a much larger screen or no screen at all (mino shuffle).

What would Cisco do with the Flip products? Adding Wi-Fi would be a logical next step to get around the buzz-killing upload process.  Flip technology could also be leveraged in home monitoring cameras, a market to which Avaak has brought rejuvenated interest. And of course, Cisco owns what was once Scientific Atlanta, so your future cable set-top box might be a platform for videoconferencing as well. Reflecting the increasing blurriness of the category, I’d also expect Cisco to push upstream with higher recording capacity (one of my biggest gripes about the Flip) and optical zoom although I would not expect it to vie with the flagship models from Sony, Canon and Panasonic. The challenge would be to manage all this iPod touch-like platform magic with iPod shuffle-like simplicity, otherwise the mino would be lost. (The mino would be lost.)

There’s also a diamond in the rough in FlipShare, Pure Digital’s revamped video organization software that has potential to be the iPhoto of video, but right now lacks critical features like being able to import videos from sources other than a Flip camcorder (such as the hard drive)..

One Comment

  1. Gregg Gregg July 17, 2009

    This deals reminds me of Skype/Ebay deal. Chambers likely does not understand the thin margins and lack of loyalty in the consumer space. I cannot imagine that the software used by Pure is too complicated to be replicated by a 16 year old Bangalore resident is 3 days.

    Does Chambers not anticipate that most phones will have this feature? Perhaps he is thinking of a Pure phone. But, he would be better off buying PALM.

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