Murdoch's MySpace, Cisco's Flip

renaissancechambara.jp/2008/05/23/unboxing-the...Image via WikipediaWhen Rupert Murdoch bought MySpace, that was hot property. And he looked like a genius when he paid $500 million for the service, and promptly got Google to pay him $900 million to run ads on the property. And that was the pinnacle. It was downhill after that for MySpace. Murdoch's corporate machine killed the whole operation with the usual jujitsu.

How you do it is you put a corporate guy on top of the whole thing, and that big shot starts thinking he is some kind of a big shot, he fires a few key people, he reorganizes a little bit. After all he has to cast the impression he is actually doing something. And that messes things up. There is no one in charge. The emphasis is no longer on innovation. It is on pleasing the corporate guy who, by the way, wants yet more ads shown on the property, because there are numbers to be met. They don't realize that might take away from the experience because they don't use MySpace in the first place, they just want to be the boss of it.

And now what do we have here? Cisco is flipping Flip. Flip was also hot when it got bought. That is why it got bought in the first place. Flip was supposed to be Cisco's own little iPod, that signature device that everyone but everyone carries and makes Cisco look cool.
CNN: Cisco kills Flip, cuts 550 workers: The networking giant said its new strategy is to serve most consumers indirectly through its business customers, rather than making products that shoppers buy straight from Cisco...... As sales grow of smartphones with HD video cameras, the need for single-use devices is fading. Flip's sales last quarter grew 15% year-over-year, but Cisco had expected them to grow 30%..... the company will eliminate 550 positions in the next three months, most of which will come from the Flip division. The networking giant said it will take up to a $300 million charge for the divestitures and layoffs in the current and subsequent quarters. ..... "The Flip acquisition was unusual from the start. Cisco said there would be a push-pull effect on the network, but that turned out to be a tough sell." .....
Facebook took care of MySpace. The smartphone took care of the Flip camera. Pray your competitor gets bought by some big company.
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