Yet another case of a big corporation driving an innovative product to the ground.
Yet another case of a big corporation driving an innovative product to the ground.
Sales were off 20%. People are using smart phones instead.
Cisco did not “drive an innovative product to the ground.” The product went the way of the buggy whip. Garmin is soon to follow.
I remember when the iPod nano got a video but not picture camera I thought, “Flip should quit while they’re ahead.”
Convergence is what is killing the flip, not Cisco. The world is converging on all in one devices like Android and iPhone. They all have cameras and video that are “good enough” now and will inevitably get better with each subsequent generation. So, basically I see this is just an indicator that we’ve reached the tipping point for interim products like Flip.
Why do you think Garmin will follow the Flip course? Because phones have GPS chips in them? Garmin makes a lot of specialized equipment that accomplishes tasks in a better way than a smart phone would. Fishermen aren’t going to use their iPhone as a fish finder/GPS, and cyclists aren’t going to use their iPhones for 6 hour rides in the rain while monitoring their heart rates. Maybe some would, but the experience overall would suffer.
You’ve pointed to the problem yourself. Differentiation.
You’re right that an iphone might not be suited for riding in the rain. But how much of that is Garmin’s core market? I’m sure if they looked at their business case the lions share of products comes from the plain old automotive, stuck in your window GPS.
Android and Iphone have been pretty big at cannibalizing that market, but it’s not a complete win because they miss some features, require constant data connections or large installed applications, and don’t ship out of the box with a vehicle cradle.
With that said - I sold my Garmin months ago. The iPhone was plenty for me to figure out where I was going.
It’s funny you mentioned cycling too because I just saw this in one of my catalogs the other day:
It’s hugely expensive, but for a small niche product you’d expect it to be. I ride with my iphone (wrapped in it’s case and shock protected in a sock in my Camelbak) because I didn’t feel like going out and buying another computer and the GPS tracking apps are great for when I go to ride. Admittedly I avoid the rain and can’t ride for 6 hours cause I’m a wimp, but it’s nice for hour long rides when it’s got enough charge.
Garmin may not go under, but I think you’ll see a lot of their market eaten up by smartphones which will continue to improve and on the other end by low end GPS systems on new cars. If you look at all the compact cars on the market pretty much all of them include a low cost 4" integrated GPS option. Even a few years ago that was unheard of. Eventually the technology will cost so little to include manufacturers are just going to do it to stay competitive.
Maybe not iPhones specifically, but some truly “smart” smartphone mfgr will come out with something that acknowledges that feature convergence = context divergence (read: more reasons to take it somewhere wet/bumpy/dirty).
Give a ruggedized klutz-proof convergent device to a cracked glass iPhone owner with less than cult-like brand loyalty and see what happens.
Exactly, remember, the smart phone is not in a static state… it is evolving every year.
That could be. I don’t have insight into their margins or what segments are most profitable.
For sake of argument…a Flip did nothing that a smart phone didn’t do already - video capture and memory. It is a blank, agnostic device. Most of the range of Garmin products are niche devices tuned to the demands of many different users, with technology and accompanying price points quite different from that of the smart phone. So yeah - Garmin must be hurting in sales of in-car GPS units and even camping or cycling computers, but they aren’t in the same position as Flip.
You can use a Swiss Army knife to cut your gouda, but a cheese slicer will do it better.
In addition to a cycling computer, I carry a phone, some cash, a spare tire and a multitool on pretty much every ride. I carry the phone for emergency reasons. I also carry that phone when drive, go on a boat or even hiking. Again, it is an irreplacable emergency tool. I think most people think this way
If most people are already carrying the phone, why wouldn’t they use it to remove an extra piece of equipment like a cycling computer? It can do the same tasks. Why do I need redundent functionality?
Currently, the exact technology isn’t in place to make Garmin go the way of the buggy whip, but no one has presented any evidence that Garmin has something that can’t eventually be replicated in a smart phone. That is why there is no way I would ever buy their stock. Time is against Garmin.
Keep in mind Flip cameras launched in 2006. That was in a pre-iPhone era when a “Smartphone” was running either a Palm or Windows Mobile operating system, and many did not do video, let alone have enough storage or a high enough quality sensor to record anything you’d want to watch.
You could argue that they did do what most digital cameras already did, but digital cameras were still a bit more pricey, and had more complex UI’s. The flips were great in the sense they let techno phobes record video, plug straight into a PC and transfer the files in the simplest way possible.
I think the problem was a recent one. A few years ago my phone couldn’t play back HD footage, let alone capture it. Now it’s no problem to record HD video on an iPhone - which now sells for as low as $49.00 for the old 3GS. The fact that the device is almost as easy to use but does everything else that comes with it and are a huge growing market just means that those markets will get eaten up.
Those proprietary GPS devices are in the same boat. Android provides extremely robust turn by turn directions. With the added benefits of satellite imagery and constant free map updates.
Garmin/TomTom/Magellean are all going to be creating similar products for a shrinking niche.
One thing no one is mentioning is that the Flip or Garmin don’t cost $60-100/month to carry around in your pocket.
Now, obviously if you are already paying that monthly cost to have a smartphone in your pocket, its a bonus that it also takes HD video and obsoletes the Flip.
The cycling computer is “extra equipment” and redundant to the smart phone only in that some, or most of the functions CAN be replicated on the smart phone, such as GPS tracking, miles, altitude, maybe even play lists or heart rate. These functions are not core to the conception of the phone - they are applied - they are applications. Specialized equipment will be superior in relevance to the context. Rubberized buttons, a heavy-duty case, larger resistive touchscreens that work with gloves, and numerous other context-specific technologies would mean the smart phone would no longer be useful as a general consumer device, to fit in a pocket, to whip out at a restaurant, streamlined and lightweight and representative of refined consumer prowess.
Smartphones with bike computer applications or musical instrument (Ocarina) applications do not replace the original devices. They are novelties.
I’ve played with motion-activated cameras, designed for hunting, that take a photo of an unwitting buck as he walks through a forest. Used to be, you had to retrieve the camera, plug it into something, and see what you got. Now more of them send photos to your mobile device.
Network connectivity is the real issue, and might have contributed to Flip’s demise. I can edit, email or even MMS a high-res video from an iPhone, while Flip (correct me if I’m wrong) needed to be plugged back into a computer to do anything else. The key thing for dedicated embedded devices is how well they will play with new or existing network infrastructures, to be part of that ecosystem, or if they build their own ecosystem and infrastructure. Garmin to their credit advertises their new smartphone app (android or apple network) as the first thing you see on their website. But can their other embedded devices send info 24/7 to the smartphone as a moderator of information?
$590 million down the drain, that’s what Cisco paid just two years ago for Flip. Venture capital firms pumped in about $70 million so they got a more than eight-fold return on their investment.
The original novelty of the Flip was the “flip” feature itself, all you had to do was flip the USB plug and you were ready to upload your movies to your computer/cloud (no need for a cable or card reader). Smartphones made that step obsolete by being able to do it wirelessly and instantly wherever you are, but I still think Cisco missed the boat and let the Flip linger behind.
Exactly like the lens in a smart phone cannot match the quality of an average lens in a point-and-shoot camera. I don’t care how many mega-pixals there are, physics is physics. The crappier the lens, the crappier the picture.
But I think there was a thread earlier about convergence lowering quality because these added functions, as you aptly put it, are only applications.
So the question becomes, is the application good enough? Is the application good enough to put Garmin out of a few markets or completely out of business? My crystal ball says yes. But then again, the same crystal ball has yet to hit the winning lotto numbers.
it makes a great point about what Flip was and what it could be. And, dare I say it, the lack of foresight in Design Thinking that could have saved Flip.
So why should a maker of router and switches keep making a video camera with declining market share? Cisco was just blindsided by the rapidly changing world of technology. Nothing they could do, right?
Wrong. The real problem is that Cisco clearly never understood what made the Flip great. The Flip succeeded because it was, as I said, Good Enough. It sacrificed video quality and advanced features (heck, it even sacrificed basic features like zoom) for the sake of being dead simple to use. And this let people get video onto the web faster and easier than they could with any other camera. This is what made the Flip blow past all its competitors.
But in the hands of Cisco, the secret to Flip’s success got lost. I bought a Flip Mino back in 2009, and happened to get a new one last Christmas. About the only thing that had changed in the intervening two years was that the video quality had gotten better. A lot better. The frames were smoother, the color richer. But the Flip was never about video quality. It was about accessibility.
When I interviewed Pure Digital’s Simon Fleming-Wood back in 2009, he understood the value of the Flip intuitively. I asked what was next for the Flip — how the company could improve its product — and he didn’t mention video quality at all. He talked about how the Flip might make it even easier for users to shoot and share video. His main focus to this end was connectivity.
I was just discussing this in the morning with my girlfriend, and we lamented it’s passing a bit. She works with community development organizations, and one of them just recently mentioned getting a few Flip camera’s for a research project. We thought it was great for that type of application because:
So I guess I just described a niche that is/was really well served by the flip, and fairly resistant to smartphone intrusion. There may be others, though I’m sure this did not make up the majority of their sales. But I wonder what percentage it did make up, and how long a sustainable business could be made out of it. Yeah, maybe overall sales were down a bit, but it was still a market leader. I imagine a profit could be made at even 50% of peak sales.
I know lots of people get hot for convergence, and maybe it’s great for things that you alone will be using. But I think there is still a market for dedicated devices, especially those that you will share with others. And, to Rkuchinsky’s point, maybe this device wouldn’t have gotten killed if it had focused on the edge it had as a specialized device (dead simple video camera, different from good quality video camera).
But it seems, according to these articles, that the killing of the Flip was part of a bigger shift away from consumer goods for Cisco, and maybe they didn’t sell it in order to hold onto IP. So maybe it really is the big corporation killing an innovative product (beside’s Rkuchinsky’s point).
Just a thought reading the above reply.
The Flip was the video version of the Polaroid camera. It was simple, single purpose and as a key was an enabler of taking videos that you might not otherwise take.
I think there’s still a market for it, the smart phone won’t have most of the market share for a long time. Make it ridiculously small, wireless, and decent quality. Oh wait, it seems Apple’s doing that already in the next 6-12 months with ipod/iphone wifeless syncing. We’ll see…
I think the main hurdle is the name. You built a brand around a feature based on a soon-to-be-outdated technology. Unless maybe Thunderbolt beats the pants off wireless sync, in which case the flip would still be relevant to the user to save upload time.
Man. This bot is pretty funny. I also am happy to be here.
Keep up the good work on the posts chenlinjia! Make sure you vary them slightly every time so people think you might be human.
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