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CES: Cisco Preps Home Invasion

Dan Jones
1/9/2007
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LAS VEGAS -- Consumer Electronics Show (CES) -- In case there was any doubt, Cisco Systems Inc. (Nasdaq: CSCO) very much wants to be the backbone of the next generation of networked homes. CEO John Chambers laid out a grandiose vision of his company's consumer-market ambitions in today's keynote speech at the Consumer Electronics Show. Lacking any product introductions, the keynote was mainly a pitch for Cisco's place in the home, where it faces rivals like fellow keynoter Bill Gates of Microsoft Corp. (Nasdaq: MSFT). (See CES: Gates Gripes About Connections.)

The speech relied on classic Cisco themes, borrowing chunks from Chambers's recent speeches. But for CES, Chambers emphasized the company's new passion (and ad campaign) for what it calls the "human network," which -- to put it in a vaguely creepy way -- follows you around, knows what you're doing, and lets you subscribe to people instead of magazines. "It's the next wave of the Internet revolution," Chambers claimed. Of course, the vision is built on Cisco's idea that everything is going IP, meaning, to quote Chambers's latest favorite catch phrase, "the network becomes a platform." Chambers was short on details of how the company will get there, although he did mention that more acquisitions are likely, and he promised a roadmap update should he get to talk at CES next year. He claimed Cisco is at the start of its usual cycle that ends with the company becoming No. 1 or 2 in multiple product segments -- just as it did in the enterprise and carrier markets.

The firm already has a significant residential foothold through its Linksys operation, which is the No. 1 provider of wireless LAN routers for small and in-home offices in the global market. Chambers claims Cisco already has "81 million devices in the consumer environment."

But Chambers stressed that Cisco's home invasion will be "device agnostic," based on open standards. "Not only are we Switzerland that most people trust," he quipped in another slightly creepy formulation. "We are Switzerland with a very powerful army."

Knowing his audience, Chambers steered the talk away from the complex network/platform slides Cisco loves to parade. At one point, he put up one such slide -- getting excited to the point of breaking his characteristic friendly patter as he talked about intelligence in the network -- then throttled down abruptly. "This isn't what a consumer experience is about. In fact, this is the reason it's growing so slowly, isn't it? It is complex. We're just doing child's play today."

Cisco plans to focus on making the home network easy, Chambers said. Demos focused on the criss-crossing of devices, media, and messages, showing how the whole process is hidden from the consumer.

One demo involved friends sharing baseball replays taken off the Web while videoconferencing on their HDTV screens. After they were done, the network showed an ad offering tickets to the Oakland Athletics, Chambers's new favorite team. The guys bought tickets by clicking on the screen, and the network sent the virtual tickets to each of their cellphones, which beeped accordingly upon receiving the files.

More generally, Chambers predicted the rise of a home network that will:

  • Handle installation of newly connected devices,
  • Determine what type of content is being delivered by the device,
  • Hand off content, mid-stream, from device to device as commanded by the user, and
  • Support voice, video, and data over multiple connections.


Chambers likened the plan to what Cisco has done for the enterprise network and is trying to do for service providers, the key being to not force consumers to understand what's happening in the network. "[It] will occur not just in the home, but in the consumer market, where it won't be about these various technology terms -- the routers and the switches, and security and wireless and storage coming together."

— Dan Jones, Site Editor, Unstrung, and Craig Matsumoto, Senior Editor, Light Reading

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paolo.franzoi
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paolo.franzoi,
User Rank: Light Sabre
12/5/2012 | 3:16:52 PM
re: CES: Cisco Preps Home Invasion

Kinda behind Apple.....

seven
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:16:52 PM
re: CES: Cisco Preps Home Invasion
I'm not at the show myself; had to write my part of this from the Webcast. Chambers really did seem excited, more so than usual in his talks. Anybody at the show want to comment on how well it was received?
ruready
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ruready,
User Rank: Light Beer
12/5/2012 | 3:16:49 PM
re: CES: Cisco Preps Home Invasion
I just completed a small office network, DSL, router, VPN access, wireless a couple of switches. Pretty basic stuff for techies or those with basic proficiency. What I've seen of the new networking or consumer stuff leaves MUCH to be desired. Cisco will acquire a bunch of companies and try to glue the pieces together.

I'd like to see what Apple has to offer here. Seems like they get the consumer.
New York
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New York,
User Rank: Light Beer
12/5/2012 | 3:16:48 PM
re: CES: Cisco Preps Home Invasion
I really wish Cisco would acquire TiVo.
FiberFan
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FiberFan,
User Rank: Light Beer
12/5/2012 | 3:16:48 PM
re: CES: Cisco Preps Home Invasion
The thing that scares me the most is Chamber's comment about (paraphrased) "doing to the home what they did for the enterprise". Does that mean we'll be overcharged and have to hire an expensive CCHC (Cisco Certified Home Consultant) to tell us what else we have to buy (from a certified Cisco reseller) to make it work properly. To ensure the home networks proper operation, we will need an onsite engineer to monitor the operations. For multi-computer or multi-TV homes, a small NOC will be required.

I can see it now........

FiberFan
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:16:48 PM
re: CES: Cisco Preps Home Invasion
You know, something else occurs to me about Apple .. . they've got a penchant for closed systems. Mac fans don't seem to mind, and it hasn't hurt the iPod in any major way. Would it work in home networks, though?

Heck, maybe it would. Sony isn't exactly open. We've all got stories of buying some consumer gadget where a replacement power pack or headphones cost six times more than necessary, just because it was Sony-proprietary...
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:16:48 PM
re: CES: Cisco Preps Home Invasion
Yes, Apple is going to be a strong play here. Microsoft, too, whether people like it or not (think Xbox -- they're willing to lose a lot of money to establish a beachhead).

I still wonder how much all these guys will bump heads with established living-room kingpins like Sony. Cisco seems to be making it clear they don't want to go up against Sony -- all this talk of building the "open network platform" translates, to my ears, into Cisco wanting to make sure it doesn't have to build consumer electronics. Makes sense.

But Cisco wants to provide the network, obviously, and they'll probably try to provide the box that controls it -- call it a router, gateway, set-top, console, whatever.

Would Cisco be content doing just the network piece, leaving the actual devices to someone like Apple or Sony? Maybe. The open platform Cisco preaches would leave the door open to that. But Cisco wants that "end-to-end" story, which would unify the home and service-provider networks ... I don't know how well that works if there's a Sony box in between the two.
paolo.franzoi
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paolo.franzoi,
User Rank: Light Sabre
12/5/2012 | 3:16:47 PM
re: CES: Cisco Preps Home Invasion

I think Cisco has no leverage in the home like it has built in the enterprise. Cable companies provide STBs and consumers really could care less whether its Motorola or SA. As long as it works.

Apple, SONY, Microsoft, Nintendo all have better positions. The Linksys play is interesting, but Apple seems to be aligning that the personal computer is the central point in the home. The others are aligning behind their various consoles. I would like to see the reaction to Viiv as well.

Just remember as closed as Apple is, the key stuff runs quite nicely on PCs. iTunes has the lead as a content management application.

I think the whole thing is quite interesting, but I think Cisco starts from quite a weak position.

seven
Pete Baldwin
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Pete Baldwin,
User Rank: Light Beer
12/5/2012 | 3:16:47 PM
re: CES: Cisco Preps Home Invasion
lol. I was wondering if someone would bring this up.

Also in the mix -- Cisco talks about being the one to smooth out all that complexity in the network, making everything easier. Kind of like the way they did with routers, they claim. I wonder what actual router techs would say to that.
chip_mate
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chip_mate,
User Rank: Light Beer
12/5/2012 | 3:16:47 PM
re: CES: Cisco Preps Home Invasion
You won't be overcharged. Cisco will find the market acceptable price for their home gear and price it accordingly.

You WILL have to buy 2 of each device to assure redundancy. That much of Cisco's sales philosophy hasn't changed.
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