Cisco Systems made its much-anticipated push deeper into the consumer space Oct. 6 with its Cisco Umi home telepresence system.
The pricey offering brings Cisco into closer competition with video communication vendor Skype and its free service, and with a host of low-cost webcam makers.
But Cisco officials believe the high quality of Umi (pronounced "you-me")-which leverages Cisco's experience with its business TelePresence business-will convince consumers to shell out the $599 for the equipment and $24.99-a-month subscription service. Umi has the best video and audio quality, and offers an immersive experience that can't be equaled on a PC-based video communication setting.
"It's a premium product at a premium price point," Ken Wirt, vice president of consumer marketing for Cisco, said during a conference call with journalists and analysts.
Umi includes a high-definition camera and embedded microphone, a console and a remote device, as well as services delivered through a cloud environment, according to Gina Clark, vice president and general manager of Cisco's Consumer TelePresence Business Unit.
It works with the user's HD television-at least 1080p-and high-speed broadband Internet connection. Along with voice and video calls, the system lets users record and play videos-and share them on YouTube or Facebook-as well as communicate with people using Google Video Chat. Clark said Cisco is interested in supporting interoperability with other video communications products.
With the remote, users can manage everything from their settings to contact lists to profiles via the user interface that Cisco officials call "The Clover."
Umi is designed to adapt to the lighting, noise levels and size of the rooms in a house.
"We had to make sure our product would fit into whatever home the customer has," Clark said.
Through the cloud services, updates to Umi will be delivered automatically.
Umi is available for pre-order now from the Cisco Umi Website and Oct. 18 from the Best Buy Website. It will be released Nov. 14 in Best Buy and Magnolia Home Theater stores and the Cisco and Best Buy Websites.
Cisco also is working with Verizon-with which it conducted tests earlier this year-to bring Umi to Verizon FiOS customers in early 2011.
Umi is Cisco's biggest attempt to date to muscle into the consumer market, more than a year after buying such companies as Pure Digital, the maker of the Flip video camera, and set-top box maker Scientific-Atlanta.
It will bring Cisco into even tighter competition with Skype, which has some 400 million users of its video communication service, though only a small percentage of those customers pay for the service. In addition, Logitech-which last year bought video communications vendor LifeSize Communications-on Oct. 6 announced a set-top box that will enable users of Google TV to conduct video calls.
Jonathan Christensen, general manager and head of platform for Skype, said Umi's price will make it difficult for anyone to afford, particularly when much less expensive alternatives are available.
"Buy a $599 device and it can be subject to obsoletism at the hands of mass-market options that sell for 1/2, then 1/4, and eventually 1/10 the price," Christensen said in a blog post. "And, when unbeatable lower cost, high performance options are readily available, spending at the top-end can be like throwing money away, especially if you are buying a video calling system and there is no one else to call."
Others have similar opinions. Gartner analyst Nick Jones said demand from consumers for such a high-end video communication system is unclear, and that if it does rise, Skype and other options can more easily and cheaply fill the demand. In addition, there are plenty of webcams to choose from, and laptops with a lot of computing power already can be plugged into the TV.
"And thirdly-and worst of all-why would any sane consumer pay $600 plus $30 a month for something which is available for free elsewhere?" Jones said in a blog hours before Umi's officials announcement. "I can't imagine how Cisco imagine this product can provide enough value to convince consumers who believe video calls are something that comes for free with Skype. Based on what I know at the moment I'll be amazed if it succeeds."
However, Cisco officials said the immersive quality of Umi-as with their business-focused TelePresence solutions-separates their offering from competitors. And the market for video communications products-in the corporate and consumer markets-is growing rapidly.
Clark pointed to IDC numbers that say that this year, there will be 32 million households with high-speed broadband and HD TVs of 40 inches or larger. That number will grow to 61 million by 2012.
In addition, Cisco officials have said they expect that within a few years, video will account for the majority of Internet traffic, and will be the major driver of a collaboration industry that will exceed $90 million.
While Umi leverages the experience that Cisco has gathered in the four years since the launch of TelePresence, users should not confuse the two, Clark said.
"We did develop Cisco Umi for the consumer, not for business," she said.