Tuesday, April 19, 2011

The Demise of the Flip

I don't usually write on this blog about specific products or topics off the personalization theme but I have to rant on Cisco's decision this week to kill the Flip camera. David Pogue wrote a great story on this in the NY Times, and there is another article here in Harvard Business Review and on Bnet here. The Flip is that pocket size camera that is brilliantly simple to produce videos and quickly upload to your PC or YouTube with a flip out USB plug. The Flip released in 2006 rode the rise of YouTube and proved to be so brilliantly simple, that its ease of use, relatively low cost and simple design overcame naysayers to become of the products of the decade.  Cisco paid $500 million for this product a couple of years ago (OK, not a lot for Cisco but still a sizable chunk of change for the seller.) And then late last week,  Cisco unceremoniously pulled the proverbial plug on the product literally hours before the next iteration of the product was released (more on that in a moment.)

Because my current profession is a product manager at a consumer electronics company, I'm now stumped at this turn of events. Pogue theorizes that Cisco thought that everyone walks around with their smart phone recording video all the time. Doesn't Apple and Google wish this were true. Only the most advanced smart phones record video and, if they do, its not in HD like Flip or with the capacity and simplicity of upload like the Flip. No, not buying it.

Maybe, as John Chambers alluded to, Cisco decided that Flip was outside their core competency of enterprise network solutions. Hmmm, that's rare for a company to admit a lack of ability to market anything but they could have easily resold the 550 person Flip unit for close to what they paid for it. Strike two.

As a product manager, there seemed to be plenty of wind left in the sail of the Flip. There is at least a few years before smart phones were indeed everywhere with capacity and simplicity rivaling the Flip. Cisco had the marketing dollars and marketplace clout to place these things everywhere...even at low cost or margin. At least long enough to recoup the purchase price of the company. Or, sold it to a company eager to have a ready made, successful product like the Flip.

OK, so here's the kicker: The new iteration of the Flip, which was supposed to be released later in the week after the product cessation announcement, was called the Flip Live. The device was to offer the capability to take video and, in real time, upload the video directly to YouTube. Read that again. Yes, that is revolutionary! Imagine that one could tune it to YouTube to watch live any event worldwide where there was a witness with a Flip camera. That's huge! If I'm out of town for my daughter's game/performance/recital, my wife could let me watch it LIVE from another location! Because she had a Flip camera with her and a broadband connection (don't know whether it would have had a 3G or 4G mobile phone connection compatibility.)  That capability would have changed the dynamic of every exclusive, ticketed event in the future. Why would I pay big bucks to attend an exclusive, non-televised event/game/concert/etc. when I could watch it at home over YouTube while someone with a Flip camera beamed it to me in real time? Sure it wouldn't have been as slick as television but you could see the amateur commentators springing up with Flip camera in hand.

Maybe that was the catch. The possibility of every event promoter's attorney screaming that they no longer owned the visibility of an event scared Cisco's legal department. That sounds hard to believe but possible. Cisco could have kept the patent on that device and still sold the rest of the product line. I'm still stumped. This will no doubt go down as an MBA product management case study. I sincerely hope that another company picks up the Flip mantle, or better yet: produces the Flip Live!

June 6 Update: Super followup recently with Jonathan Kaplan who created the original Flip and sold it to Cisco. Read the article. Some interesting nuggets in their about corporate priorities, intertwined technology which made divesting nearly impossible, and even tax breaks for failed products. Also some great background in the origin of the Flip name and his stance on entrepreneurial spirit.

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