Cisco restructures consumer business, terminates Flip

As part of its plan, Cisco will

– close down its Flip business and support current FlipShare customers and partners with a transition plan

– refocus its Home Networking business for greater profitability and connection to the company’s core networking infrastructure as the network expands into a video platform in the home. Thes products will continue to be available through retail channels.

– integrate Cisco umi into the company’s Business TelePresence product line and operate through an enterprise and service provider go-to-market model, consistent with existing business TelePresence efforts.

– assess core video technology integration of Cisco’s Eos media solutions business or other market opportunities for this business.

"We are making key, targeted moves as we align operations in support of our network-centric platform strategy," said John Chambers, Cisco chairman and CEO. "As we move forward, our consumer efforts will focus on how we help our enterprise and service provider customers optimize and expand their offerings for consumers, and help ensure the network’s ability to deliver on those offerings."

In connection with the changes to the consumer business, it is anticipated that Cisco will recognize restructuring charges to its GAAP financial results, with an aggregate pre-tax impact not expected to exceed $300 million during the third and fourth quarters of fiscal 2011. The company expects this will result in a reduction of approximately 550 employees in the fourth quarter of fiscal 2011.