How much revenue growth did Cisco really earn from Flip and TelePresence?
My perspective on the "dollar amount success" with regard to the100% increase in TelePresence revenue got a little bit more transparent with Cisco's latest SEC filing.
By Brad Reese on Fri, 11/20/09 - 12:49pm.
Lately, I've been trying to put into perspective the "dollar amount success" for 2 of Cisco's much ballyhooed products, the Flip video camcorder and the Cisco TelePresence video solution. Since I don't have any inside information on which to make dollar amount conclusions, I've had to rely totally on what Cisco has made available to the public, for instance, during Cisco's F1Q10 earnings call, John Chambers boasted:
"To give you some additional color on our progress in this area, we talked earlier about tele-presence revenues once again growing in excess of 100% year over year, a proof point that our customers truly understand productivity and value that video delivers internally and with their own customers and partners. Other product areas that may be of interest to you from a revenue perspective including tele-presence had increases over 100% and we added approximately 85 new customers in Q1. Pure Digital’s [Lift] had revenues of approximately $50 million and CRS revenue was up approximately 7% year over year."
Interestingly (at least to me), I think I may have hit "pay dirt" with Cisco's latest Form 10-Q filed with the SEC earlier this week (page 38), which, if not offering absolute numbers, finally allows me to place some sort of "dollar amount success" on the Flip video camcorder and Cisco TelePresence products:
"While we did experience a sequential revenue increase in many of our product categories, our net product sales declined year over year across almost all of our product categories in the first quarter of fiscal 2010, except for sales of our products under the category of other, which reflected positive year-over-year revenue growth as well as positive sequential revenue growth. The year-over-year and sequential revenue increase in that category was driven by sales of Flip video cameras from our fiscal 2009 acquisition of Pure Digital Technologies, Inc. ('Pure Digital'), and increased sales of Cisco TelePresence systems."
Cisco's 1st Quarter Other Product Revenue By Fiscal Year:
F1Q10 - $481 million (page 35) +$42 million increase
F1Q09 - $439 million (page 35) -$71 million decrease
F1Q08 - $510 million (page 40) +$55 million increase
F1Q07 - $455 million (page 33)
So according to Cisco's F1Q10 earnings call and latest SEC Form 10-Q filing, Flip video camcorder revenue combined with a stunning 100% increase in Cisco TelePresence revenue produced a mind-boggling $42 million increase in Cisco revenue. All of this points out that even though Cisco makes a lot of noise about the possibilities of videoconferencing, relatively speaking, it's still a tiny business for Cisco -- so small that they bury it in the "other" category, along with the Flip, optical (which appears to be closing down) and who knows what else.
Even more revealing (again at least to me), during the Cisco F1Q09 earnings call, Chambers didn't mention a "peep" about the revenue growth of TelePresence. I find that revealing and interesting because Cisco's Other Product category revenue (which includes TelePresence) fell by -$71 million during Cisco's F1Q09?
What's your take, does Flip video camcorder revenue and a 100% increase in TelePresence revenue have the wherewithal to create a financial windfall for Cisco shareholders?
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Piss in the bucket
$42 million increase in this category while losing $1.3 billion from the top line overall. That is 3% !
This is purely diversionary. Putting a good spin when the top line is deteriorating (fast). I would run away from Cisco stock as fast as I can.
Speaking as a customer, they have a big hole in their video lineup. You have telepresence at $200,000 plus and Flip at < $200. Where is the video in their bread-and-butter IP telephones ? Is call manager not capable of video ?
The big system is a non-starter at that price point. Like someone previously mentioned, they will have to give it away.
The Flip is also a non-starter because lack of uplink network capability. Who is going to waste 15 minutes to hook it up to a PC and upload to twitter or facebook ? Iphone and Android already lead by a big margin in this space and the Flip is going to be left in the dust. Total lack of vision and misallocation of resources.
Their purchase of Tandberg
Their purchase of Tandberg would the gap between high end TelePresence and the Flip, and the next generation Flip will be WiFi capable.
I'd be shocked if they don't integrate video capabilities into their VoIP line in the next year or two.
WTF
I hope you are not serious. I have a Cisco IP phone from 2001. The day I got it, I thought "it would be nice if they will have Video someday, maybe it could even replace my PC and let it take care of all my communication needs someday". That someday never came. Meanwhile, I get all kind of trouble from my ip telephone setup. Inexplicable dropped calls, one-way way voice, all kinds of trouble. Now you are telling me I have to wait for an acquisition to take care of this and have to wait 2 years for video. F*ck you.
Take your Prozac dude. I
Take your Prozac dude. I wasn't trying to argue with you.
Those are the plans Cisco have laid out to address the points you brought up.
Yep, let's keep things clean.
I agree fully.
What makes this blog so great, popular and interesting is the multitude of varying opinions that comes from people.
Even I at times during heated arguments did exchange a few words, uttering vile remarks not indicative of my professional conduct. Needless to say, I have regretted my previous actions, and I have apologized to CC and others for my juvenile conduct.
Let's keep swear words, personal insults, xenophobia, racism, etc. out of this blog. Let's all be civil.
Best,
my bad
Pardon my French. I'll try and calm down next time. All I know Is that my tech-savvy users already ditched their 7960 and moved on and I have to explain the ROI all the time to my co.
punch line
Here is the punch line. I can really lose my job for buying Cisco. Simply because their crap creates headache for me and my users. My skunk works people already figure it out. I trust my power users and their opinions.
get a grip
If you have so many problems with dropped calls, one way voice, etc then you likely have problems with your network and poor/no QOS. Don't blame the phone when your network is to blame.
budget
Sorry. Budget cut by 50%. Will not Invest In Cisco gear In the near future
My network is fine. You want me to point to ddts? Or are you saying you can only speak for ip phone not other Cisco crap
?
Sprint
I went to a Sprint conference and whenever some one mentioned Qos I cringed. Qos is legacy, it doesn't simplify it complicates. Whenever someone mention Qos to me, it only shows the person is peudo-technical. They know the buzzwords but probably never managed a real network in their life.
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