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Tang, Matthew

Cisco Systems

Company History
Cisco Systems is a multinational corporation that is headquartered here in San Jose, CA. The company specializes in designing and selling home electronics (such as networking devices), security & surveillance products, communication products (phones, etc.), routers & switches, borderless network products, and also data center & virtualization products.

As of 2010, Cisco has 65,000 employees and boasts annual revenues of about 40 billion US Dollars, making the company one of the biggest technology companies globally. The company was founded in 1984 by a couple (Len Bosack and Sandy Lerner) who decided to leave their jobs at Stanford university to create their own start up. The name of the company comes from the abridged version of nearby big city San Francisco.
After the company went public, the first CEO was Bill Graves, who only held the position for a year from 1987 to 1988. After that John Morgridge held the title for roughly seven years before John Chambers took over in 1995.

The company's main source of revenue when it first started was routers because they were one of the first companies to successfully design and sell routers that supported more than one network protocol. Today the company makes a portion of its revenue still from selling routers, but since multiple network protocols was no longer needed with the internet protocols emergence, the routers now deliver internet protocol packets.

During the 1990s, the company made some of the biggest acquisitions in the industry, such as acquiring Cerent Corporation for 7 billion US Dollars. Although the company is generating less revenue than prior to the dot com bubble burst, the company is still holding up relatively well. At the dot com peak, the company was the most valuable company in the world, which was valued at over 500 billion US Dollars.

Today, Cisco sells the products it develops under several names (Cisco, Linksys, WebEx, and Scientific Atlanta).

Cisco Entering New Markets

Critics say that Cisco entering new markets will never reach the profitability of Cisco's main market, which is network devices. Cisco acquired Pure Digital in 2008, whose main product is the Flip video camera. The Flip sells at roughing 200 dollars a unit (roughly 400 million US Dollars a year in sales), which does not come anywhere close to the amount of profit commercial networking devices creates for Cisco.
It can record videos in 720p and can record up to two hours of videos. The Flip has gotten great reviews all around, some saying that it is the best pocket camcorder to date. According to PCWorld.com, "The second-generation Flip MinoHD is the sexiest and most solidly built pocket camcorder we've seen yet, and it backs those refinements up with very good video quality." The flip boasts a gyroscopic image stabilizer which minimizes hand shake's effects on the video taking capabilities of the pocket camcorder, something that has plagued other compact camcorders in the past.

As you can see by the great reviews of the Flip, Cisco Systems is branching out in the products it is developing and is succeeding in capturing more market share. With negative reviews mainly citing the only negative about the flip being not able to record 1080p videos, I am sure Cisco Systems is currently working on that to please it's customers. Although currently the company is not making much money from these new markets, who knows what these new markets will bring for Cisco in the future if they continue being competitive.