How Linksys Buy Extends Ciscos Reach

LinkCisco? The acquisition may not mean much to the price-pinching hacker crowd that has traditionally bought wireless broadband routers, but Wireless Supersite Editor Ross Rubin sees the new parent's expertise expanding its market to other customers.

Every so often, enterprise networking companies buy into the promise of the digital domicile and make some overture to wire, or as is now the case, unwire the home.

The last time this happened (to disastrous effect) was when 3Com brought a bevy of home-networking products, including the much-maligned Audrey Internet appliance, briefly to market in 2000. Audrey, in fact, was supposed to be the first in a line of devices under a new brand called Ergo, as in, "Er, go throw those things into a landfill."

But now the pipedreams of Internet appliances have been replaced with networked appliances—primarily digital entertainment devices that act as PC peripherals throughout the home and leverage the increasingly underutilized drive capacity inside those machines. One example is the TiVo Series 2s Home Media Option that cops a few features off SonicBlues ReplayTV line and adds digital MP3 jukebox features. Coincidentally, TiVo has anointed Linksys to provide the adapters for this add-on.

At first glance, it seems like bad timing that Cisco purchased Linksys after the worlds largest chip company has given due warning to the networking companies that 802.11b is motherboard-bound. However, if the market for pushing digital video around the home takes off, the next wave of high-speed Wi-Fi networks could show theres some momentum left in this market after all. Indeed, the more integrated 802.11b there is out there, the greater the market to upgrade and bridge those networks with the "g" and "a" flavors of the future.

As 3Com learned in 2000, enterprise brands, even those that share the similar retail channels that consumers use, dont necessarily make it in the consumer market. Cisco should be prepared for a world where price competition is brutal, tight integration with your suppliers is critical, and product lines are broad, unwieldy, and support fringe standards.

But Ciscos software-engineering prowess could prove valuable to Linksys, which is at its heart a hardware company. Linksyss devices, while easy to set up for the home user, dont integrate substantial management controls for administrators. Correcting this would prove valuable not only for branch offices, but also professional installers who will develop the most sophisticated home networking solutions. Future versions of devices such as Turtle Beachs AudioTron, the most successful networked stereo component to date, will be developed with these kinds of advanced home networking installations in mind.

For unmanaged networks, though, Cisco would do well to interfere as little as possible and extend its promise to keep the Linksys brand separate. Linksys practically invented the market for the wireless broadband router; the geek subculture that has sprung up around the company wont need much provocation to look elsewhere.

Wireless Supersite Editor Ross Rubin is a senior analyst at eMarketer. He has researched wireless communications since 1994 and has been covering technology since 1989.