Cisco Systems, Inc. (CSCO) has been featured in much of the financial press today. The reason is their decision to announce a major addition to their strategy. Cisco is going to add consumer products to their product lines.
Cisco historically has produced the routers, servers and switches that serve the internet. They have marketed to other businesses and have been remarkably successful.
Cisco has had a few consumer products, but is looking at this sector to drive growth and investor interest going forward. In my opinion they are looking at achieving a boost to their share price from the new effort.
Consumer products are very different from the markets Cisco has thrived in. I wonder if their remarkable skill set is transferable. It may be as Cisco has driven much of its growth through acquisitions of businesses in the niches it is interested in.
It may be hard however to find the "Aha!" factor that would differentiate their products in a very competitive world. They may have to build distribution and marketing channels that are very different from those they currently use. Cisco may be the company that has most integrated the internet into their business. This may allow them to achieve easier market penetration. It will be interesting to watch.
What do you think? Is Cisco a buy, hold or sell? Why do you think that? Take a few seconds and share your opinion.
Cisco is a hold. The consumer market is flooded with consumer products and Cisco products are notorious for being difficult to configure. What the consumer market doesn't need is a hard to configure device that is supposed to connect to them in a non-secure fashion to something that isn't secure.
Posted by: JDW | September 6, 2006 5:51 PM | Permalink to Comment