Two years ago, network company Cisco purchased Flip camera maker Pure Digital for $590 million. Today, the company announced that it would be shutting down Flip camera production as a part of a re-organization. This re-organization will also result in the loss of 550 jobs.
Production of Flip camera to end
The Flip camera first went on sale in late 2007. The small, handheld camera was one of the first video camera products that was easy to use and priced for the general consumer. In just two years, the camera sold more than 2 million products, and it is still the top-selling camcorder on Amazon. Despite its popularity, Cisco plans on phasing out the Flip camera by year’s end.
Cisco ‘refocusing’ efforts
In the last few years, Cisco has been expanding business efforts to include consumer products. In a memo sent to the company last week, Cisco’s CEO expressed concern that the company had “lost its focus by trying to attack too many businesses.” In order to refocus, the company plans on shuttering its entire consumer products division. This includes the Flip video camera, the Linksys Wireless Home Audio system and the Flipshare system. Instead, the company will be reinvesting in network products.
Alternatives to the Flip
The Flip camera was one of the first consumer-level simple-to-use video cameras, but competition is being cited as one of the reasons Cisco plans on shutting down Pure Digital. Kodak, Sony and other optics companies have their own versions of stripped-down, small video cameras. Many smartphones now also have the capability of taking video of a similar quality to the Flip. There are some who consider smartphones direct competitors to the Flip camera. There is a large market of people who do not have smartphones who use the Flip or similar products. The surprising part of this story is not that Cisco is ending its association with Pure Digital but that the company will be shuttered, rather than sold.
New York Times: http://www.nytimes.com/2011/04/13/technology/13flip.html
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