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Cisco takes the tablet to work

Cisco Systems sees big opportunity for its new tablet PC that focuses exclusively on business users.

Tablet PCs aren't just for playing super-sized versions of Angry Birds or streaming Netflix movies. They're increasingly being used in the work place.

Cisco Cius tablet Cisco Systems

The popularity of the Apple iPad is spilling over into the workplace, where everyone from executives to nurses to sales associates to people who stock the shelves at your favorite retailer are using tablets. It should come as little surprise given the small form factor and touch screens that make these devices so appealing.

Cisco Systems, the world's biggest maker of infrastructure equipment that helps businesses connect to the Internet, wants a piece of the action. Last year, the company announced it was developing a 7-inch tablet PC based on the Google Android operating system. The company announced today that the new product would be commercially available at the end of July. And it announced an app store called AppHQ, which will allow corporate IT managers to develop and manage customized apps for their companies.

But Cisco's Tom Puorro, senior director of product management for the Cius, said the device is not just a tablet. It also becomes a virtualized desktop computer, a video conferencing hub, and a communications tool all in one. And because of its versatility and focus on corporate customers, Cisco thinks it offers something other tablet makers don't.

"I can't argue with the success if the iPad," Puorro said. "It's a great consumer product, but most people who bring tablets to work use them for email and watching movies. We thought a device should do more. Cius is an enterprise grade device."

Stiff competition
But there are other competitors that also see a big opportunity in taking the tablet to work. In addition to the Apple, Research In Motion, Dell, and Hewlett-Packard are also addressing this market.

BlackBerry maker RIM has created the 7-inch Playbook. Like its BlackBerry smartphones, RIM is using its own operating system for the Playbook. But the company does plan to leverage apps developed for Android in order to help the device reach a wider market.

PC makers, Dell and Hewlett-Packard also plan to address the corporate market with their own tablets. Dell is working on tablets using Android, while HP is using WebOS for its TouchPad tablet.

Because many people bring their own devices into work with them, RIM, Dell, and HP are trying to appeal to both the consumer as well as the business user. During Dell's investor conference today, Jeff Clarke, vice chairman for global operations and end-user computing, said the company plans to target both "prosumers," eWeek reported Wednesday.

"It really is about participating in the growth markets," eWeek quoted Clarke as saying. "It's about participating in the growth markets in the mobile space in a very, very different way. It's not about being another consumer player in smartphones and tablets. It's about taking our company's core strength in the middle market. It's about targeting our tablets and smartphones for those usage models."

RIM has also expressed interest in addressing not only corporate needs, but also making the device appeal to consumers who may bring their Playbooks to work.

Cisco hones its focus
By contrast, Cisco is the only company that is focusing exclusively on business users with its Cius tablet. While the Cius is not as thin or as light as an iPad, it comes with a replaceable battery and it can fit into a docking station that turns the device into a virtual desktop and an office phone.

Cisco, which has spent much of the past 20 years selling to large companies, service providers and governments, had a go at the consumer market with products, like the Flip video camera and a scaled-down telepresence offering for the home called Umi. But earlier this year, the company shifted its attention back to its core corporate customers, and it abandoned the consumer strategy.

"Cisco's biggest differentiator is that it is only addressing the enterprise," said Zeus Kerravala, senior vice president at Yankee Group. "Dell, HP and RIM are trying to straddle both the consumer and enterprise markets. But Cisco has learned its lesson and is focusing on what it knows."

So what is it doing differently? For one, Cisco offers what it calls enterprise-class security for the device. This means that information on the tablet is encrypted, so if it's lost or stolen, other people can't access the data. IT managers can also remotely wipe the Cius of all data. And it comes with integrated VPN functionality. Applications that require secure connections to the office automatically launch the VPN, so the user doesn't even have to think about whether the data is secure.

Cisco's Cius tablet can fit into a docking station and replace an office phone or become a virtualized desktop. CNET/Marguerite Reardon

Secondly, Cisco has integrated its existing products and collaboration tools into the device. The device is based on the Android OS, so users can download Angry Birds, Fruit Ninja, or whatever other Android apps they'd like to use. But it's up to the IT administrator to decide which apps are allowed on a particular device. Meanwhile, Cisco has already baked in some of its corporate tools, such as the popular online collaboration service WebEx and Cisco's unified communications functions.

And the third thing that sets Cisco apart is its enterprise-focused app store AppHQ. This app store allows IT mangers to create their own branded app stores. From this platform they can restrict or allow access to all apps. Because Cisco is using Google Android as the foundation for the Cius, the tablet can also support Android apps from the Android Market. But it's up to IT managers to determine if the Market can be accessed.

"Being able to leverage the Android developers and also have AppHQ will be Cisco's unique jewel," Kerravala said. "Cisco already focuses on enterprise customers and their needs. And with their voice over IP business, they already have a business they can sell into."

This is yet another important distinction. While RIM, HP, and Dell also have relationships with companies, Cisco's Cius product can easily take the place of a product it's already selling to corporate customers. About 20 percent of all phones in the enterprise market are sold through Cisco. And the Cius, which can replace an office phone and even a desktop or laptop computer with a special docking station, may be an easy upgrade into Cisco accounts already using its voice over IP service.

Ross Rubin, an analyst with NPD Group, said Cisco's Cius will likely appeal to industries and companies that require more security and more remote management of devices. Industries such as health care or financial services may be most interested in the product. In fact, one of Cisco's beta customers for the Cius has been Palomar Pomerado Health, which operates several health facilities in California. Orlando Portale, chief innovation officer for Palomar, said he sees the Cisco Cius tablets as a good fit for use at nursing stations and throughout the hospital environment.

But Rubin said there are still plenty of businesses where consumers buy their own devices and need far less management from the corporate IT department.

Kerravala agrees that Cisco will never be No. 1 in overall tablet sales. But it could be No. 1 in pure corporate tablet sales.