**[FONT=Times New Roman][size=3] ** Cisco has announced that it will stop producing Flip Video devices, bringing an end to the dummy-proof HD video recording and sharing function that was once very popular.
The Flip Video camera was once a rising star in the tech world, mainly because it made it easy to record HD video. No, the image quality wasn’t as good as what you’d see on more expensive cameras, but Flip – and other pocket cams from Kodak and Sony – rose in popularity because they could quickly record, upload to YouTube, and do it all at a budget-friendly price.
That budget wasn’t friendly enough because Cisco is shutting down the Flip Video operation. Cisco spent $590 million to buy Flip in 2009, but it’s cutting its losses just two years later because the company wants to refocus its efforts. Why? This is just a guess, but the shutdown probably has a lot to do with that phone in your pocket.
Flip cameras became popular because they are mobile, affordable, and incredibly easy to use. Doesn’t that describe smartphones to the letter? What’s more mobile than the device that you never leave home without? What’s more affordable than a phone you were going to buy anyway, removing the need to spend an extra $200 to get a Flip Cam? And as for easy to use, what’s easier than pressing a button on your phone and then pressing “Share” to have it uploaded to YouTube?
Flip cameras were never as good as the pro-level devices, but they were “good enough” to replace mid-range camcorders. Mobile phones have evolved to do the same. A smartphone that can film in HD and perform 1,000 other tasks eliminates the need for carrying a second device. I covered how apps can improve photo taking, but with Apple, HTC, Sony Ericsson, and other phone manufacturers packing HD video cameras into their phones, Flip never stood a chance.
Farewell, old friend. Say hello to the alarm clocks, stop watches, portable gaming systems, and all the other devices that have or are being replaced by mobile phones.
CNET just published an intriguing article on some of the potential reasons Cisco decided to kill the Flip Video business. It suggests that the main culprit isn’t slowing sales per se - the pocket cam category seems quite healthy overall - but instead points the finger at the low profit margins in the consumer space, something that Cisco isn’t used to dealing with in their enterprise business which is far more profitable. The danger sign here, if the profit issue is in fact the primary concern, is that Cisco owns another very popular consumer business: Linksys. Could this company be next on the chopping block? Granted, home networking is a very different category than video recording/sharing and it is much closer to Cisco’s core networking business, but profits on Linksys gear is likely quite low too, comparatively. Let’s hope that if they do exit the Linksys business, that they sell it rather than close it down as they did with Flip. - Ed.]