Cisco CEO beats on the consumer electronics drum

Cisco's CEO says the company has plans to ramp up its consumer efforts over the next few years.

LAS VEGAS--Cisco Systems plans to focus on the consumer market a lot more in the next three to five years, the company's CEO John Chambers said Wednesday during the company's press conference at the Consumer Electronics Show.

John Chambers, Cisco Systems CEO Cisco Systems

This increased focus will likely mean a "steady stream of product announcements, partnership announcements and acquisitions" from the company as it grows this market, Chambers said.

Cisco initially got into the home networking business in 2003 with its acquisition of Linksys and it increased its presence a couple of years later with the acquisition of set-top box maker Scientific Atlanta. With these products as the corner stone of its consumer business, Cisco claims it has sold some 160 million home routers and set top boxes.

But Chambers said the company plans to make a much more aggressive push moving forward, especially over the next 12 months.

"We are really committed to this market and we're putting the whole company behind it," he said. "We will be very aggressive."

Chambers said he hopes to grow Cisco's consumer business to between $5 billion and $10 billion over the next few years.

Cisco has been talking about increasing its presence in the home for more than a year. And Wednesday it announced new home networking products and a bold new service designed for big media companies to help bring more rich content to consumers.

The first set of products come from the Cisco's Linksys home-networking business unit. And they're designed to let consumers share music throughout their home. The Wireless Home Audio system sends music over a standard Wi-Fi network to speakers in multiple rooms. The bundle of products, which starts at about $999 for two rooms, even allows music from Apple iPods and iTunes to be accessed through a single controller and played throughout the home.

Cisco also introduced a new Media Hub , a storage device that allows people to access content remotely over the Internet. The product, which comes in different storage capacities up to 500 gigabytes, starts at $299. In addition to providing remote access, the Media Hub provides back-up of digital files, such as photos and music.

And in an effort to help big media and entertainment companies provide richer interactive content to consumers, Cisco announced its new Eos hosted software platform . Cisco will offer the Eos technology as part of a service, which media and entertainment companies will use to create, manage, and grow online communities. The idea is to streamline the process for building new Web sites, while also allowing media companies to add interactivity and social-networking components.

Chambers said that more is to come over the next several months. But he emphasized that Cisco's focus on consumer electronics is not just about individual products, but about building a platform and an architecture that can be sustained in the future.

For all its fervor, Cisco's consumer ambitions may not be so easy to achieve. The consumer electronics market is full of competitors. For example, the home audio system that Cisco announced Wednesday is very similar to what's already offered from Sonos. And there are plenty of companies already offering media hubs. What's more Cisco's pricing is not much different from its competitors.

Additionally, Cisco is still struggling to provide a consistent brand to the market. Today's new products for the home are branded Linksys by Cisco. But the company is in the process of migrating its branding solely toward Cisco.

"Cisco is the main brand," said Ned Hooper, senior vice president of corporate development for Cisco's Consumer Business Group. "But we also have existing brands that have generated significant value. So Linksys will be a family brand."

 

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