Kiss is unusual in that it makes a range of consumer electric products, including DVD players, digital video broadcasting receivers and televisions. But a spokesman denied that the acquisition would see Cisco broaden its range into the consumer electrics space as Dell has done, leading it to drop the world ‘Computer’ from its name.
Though a detailed strategy has yet to be worked out for Kiss’ integration into Cisco’s Linksys division, which provides connectivity for the home and small business environments, the products developed will be offered to other manufacturers.
In a fragmented consumer electronics market, Cisco believes there has been a tendency for each manufacturer to circle their wagons against competitors, while Linksys will push for open standards that will allow all manner of household devices communicate with each other.
Kiss recently introduced a PC-Link Server Edition that was designed to transform any of its products with a hard drive into a home-server that could stream digital content to other networked products in the household.
This fits in with Cisco’s belief that the network will become the platform, rather than the narrow view that the set-top box will become the hub of the networked home.
The market opportunity is tremendous, particularly with the rapid take-up of broadband connections to the home and the prospects for development of the triple-play of internet connectivity, telephone connections and TV to the home.
Cisco quotes market research firm In-Stat as estimating that the networked entertainment market was worth $3.9bn world wide in worldwide revenue at the end of 2004 and was expected to grow to $16.1bn by 2009. In-Stat also estimated that networked entertainment devices will be in use on more than 38% of home networks by the same period.
This is Cisco’s second acquisition to build up its Linksys division. In April 26, It paid $68m in cash for privately-held Sipura Technology Inc, which was a key technology provider for Linksys’ current line of VoIP networking devices.
