Cisco to Use Videoconferencing to Step Up Appeal to Consumers

Today Cisco is unveiling a new videoconferencing system to compete with Skype and other videochat programs. It is meant to appeal to consumers in that the conferencing will be available over TV screens which are in general much larger and more conveniently placed than computers. Cisco's stock has risen just from the announcement of the release of this new system in hopes that it will live up to the expectations that consumers will find it useful.

The system will be expensive, possibly around $600 according to the article but details will be specified later today at the news conference. This compares to the generally free version of Skype used by over 560 million people. Most of us have seen the Cisco videoconferencing commercials, but those are more business and education oriented such as all the Cisco projectors at our university. This new system will be utilized right at home in the living room where chats to friends, relatives, and business associates can be done.

I forsee Cisco struggling to win over the consumers who have already dedicated themselves to free chat programs such as Skype and Oovoo. The idea of spending for videoconferencing, even for better quality and convenience, has not yet been introduced until this. It will be up to consumers to decide whether the investment is worth its price, as the return on investment may be small depending on the number of calls you make. However, the success of Cisco in the business world could just as easily spill over into the consumer market and lead to a large revenue stream from satisfied customers. It will be interesting to see how Cisco can stack up against the already popular versions of videoconferencing.

http://www.bloomberg.com/news/2010-10-06/cisco-to-use-videoconferencing-to-step-up-appeal-to-consumers.html