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Cisco's New Media Workhorse

Phil Harvey
12/31/2008

1:20 PM -- At CES next week, I'm really going to pay attention to the monster chatter. I want to hear what those behemoths like Cisco Systems Inc. (Nasdaq: CSCO) and Microsoft Corp. (Nasdaq: MSFT), who are big enough to influence the service provider community and consumer population simultaneously, have to say about where the networked home is heading and how the networks feeding those homes can help.

Cisco
I'm curious to see if Cisco will come any closer to delivering a viable home "media adapter," the concept device it has kicked around for years. In 2007, after seeing a rough demo of Cisco's answer to the Apple TV, we reported that this class of device, "not the set-top, not the PC," was destined to be "the workhorse in Cisco's connected home strategy."

The Cisco device that I saw in 2007 could "aggregate and serve any media from any device in the home. It will also allow for purchasing video, audio, and other entertainment without requiring a set-top box." This is a huge end-around to the issue of media-sharing in the home -- a problem that service providers like AT&T have struggled to solve.

Apple has improved its media workhorse, the Apple TV. I got one earlier this month on my 29th birthday, and it is the perfect complement to a standard TV service -- and it's a great gap-filler for those of us that have a digital music library in one room, and a pretty good stereo system in another. [Ed. Note: Copydesk, do not fact-check that birthday statement.] Geek tip of the week: My Apple TV connects to my home network via the Ethernet port on my U-verse set-top. That way I got a hard-wired connection to the Apple TV without having to string anymore wire in my attic.

The timing has never been better for Cisco to leap face-first into the consumer electronics space, as has been reported in the past few days. The company understands networking and service provider networks, and they're beginning to figure out consumers. Cisco-branded consumer electronics will mean the home networking part won't be something that's bolted on after consumers complain.

Apple needs a viable competitor here -- and both Cisco and Microsoft seem ably qualified to step up. In Cisco's case, though, the networked digital stereo that it will reportedly announce had better address the reality that most people who listen to digital music have most of their collection in an Apple-proprietary audio format.

We like iPods. We buy from iTunes. We love simplicity and that's not about to change. So the move to compete against Apple should somehow include Apple, if Cisco is truly on the side of consumers.

Now, why should Cisco's move into the CE biz concern service providers -- Light Reading's audience? I really do think media adapter, Apple TV-like devices are something that every networked home should have. They make purchasing video and audio effortless (and a little to knee-jerk, according to my credit card bill). The devices make a broadband connection more valuable than ever, and they also provide that perfect bridge between digital media storage and spur-of-the-moment utility.

Should consumers get an Apple TV-like device from their broadband provider, or should we keep buying them from antiseptic retail stores that sport more gray and white than an IBM shareholders meeting?

Cisco could have a big role in answering that question.

I'll post some thoughts on Microsoft after the holiday. Happy New Year!

— Phil Harvey, Editor, Light Reading

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