Cisco Systems Inc. (Nasdaq: CSCO) is exiting parts of its consumer businesses, with plans to shut its Flip video camera business.

However, whether the moves will affect the company’s campus in RTP is something Cisco won’t discuss. At well over 4,000 workers, the Triangle operation is the firm’s second largest, smaller only than the headquarters in California.

“We’re not disclosing locations where employees are affected,” a Cisco spokesperson said in a brief phone interview. Because the company is in a state of transition, she added, Cisco at this time would not go into “a great deal of specifics” about what types of locations are located where.

The announcement by the world’s biggest maker of computer-networking gear on Tuesday comes just a week after CEO John Chambers sent a memo to employees vowing to take “bold steps” to narrow the company’s focus. (Read about the memo here.)

“We are making key, targeted moves as we align operations in support of our network-centric platform strategy,” Chambers said in a statement. “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.”

Cisco, which is facing stronger competition from rivals in its core business, said it will realign its remaining consumer business to support four of its five key priorities — core routing, switching and services; collaboration; architectures and video.

The San Jose, Calif., company anticipates its consumer business shakeup will result in the loss of 550 jobs and restructuring charges of no more than $300 million in its fiscal third and fourth quarters.

The key points in the Cisco announcement:

  • “Close down its Flip business and support current FlipShare customers and partners with a transition plan.
  • “Refocus Cisco’s 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. These industry-leading 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. [Umi is Cisco’s videoconferencing product targeting homes and consumers.]
  • “Assess core video technology integration of Cisco’s Eos media solutions business or other market” {Eos is a social entertainment platform.]

Cisco bought Pure Digital Technologies Inc., the maker of the Flip camcorder, for $590 million in 2009, just two years after the San Francisco-based company made its first camera. It quickly became a top seller because of its ease of use. A signature feature, since copied by many other manufacturers, was a USB connector that flipped out of the case, letting the user connect the camera directly to a computer. The camera even contained video-editing software that fired up on the computer.

Last year, the Flip Video was still the top-selling video camera in the U.S., with 26 percent of the market, according to IDC analyst Chris Chute. But that only amounted to 2.5 million units sold. Dedicated video cameras are small potatoes compared to digital still cameras and smart phones, both of which now shoot video.

That could be the reason Cisco appears to see no point in selling the business – the announcement Tuesday said Flip will be closed down. It will continue to support the sharing of Flip videos online. A Cisco spokesman did not respond to a question about why the unit would be shut down.

Top competitors in the pocket camcorder field, which could benefit from Flip Video’s demise, are Eastman Kodak Co. and Samsung Electronics Co.

Cisco appears to see no point in selling the business — the announcement Tuesday said Flip will be closed down. It will continue to support the sharing of Flip videos online.

The moves mean retrenching on another consumer video business – home videoconferencing. In November, Cisco started selling the umi, a $599 box that turns a high-definition TV into a big videophone. But signs soon emerged that the umi wasn’t doing well. It cut the price of the unit in March, along with the monthly service fee, which went from $24.95 per month to $99 per year.

On Tuesday, Cisco said it will fold umi into its corporate videoconferencing business and stop selling the box through retailers. Instead, it will sell it through corporate channels and Internet service providers.

Cisco’s Home Networking business, which makes Wi-Fi routers and has the 2003 acquisition of Linksys at its core, will be “refocused for greater profitability,” but Cisco will keep selling the routers in stores.

Cisco employs more than 4,000 people at its campus in Research Triangle Park,. N.C.

Read the Cisco announcement here.

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