Personal Networking: Cisco Systems Announces Strategy for Consumer Markets; Alliances, Enabling Technologies Will be Key to Creating `Personal Network

Cisco Systems Inc. Thursday announced its strategy to extend its Internet leadership to the consumer market. The strategy is built around a vision to extend high-speed Internet access from business to the consumer market at speeds up to 1,000 times faster than today's dial-up connections. Cisco also plans to introduce high-speed "personal networks" within the home, connecting individual users to PCs, phones, TVs and other Internet appliances over a single broadband network. Cisco's strategy will be based upon an open Internet platform, in addition to a series of collaborative alliances with service providers, consumer electronic manufacturers, software developers and other companies who choose to play a role in providing Internet-enabled services applications, and devices for consumers. "The Internet revolution was started by big businesses who understood that the Internet had the power to re-define and re-create the competitive landscape. Today, consumers are the driving force in the Internet Revolution," said John T. Chambers, president and CEO of Cisco Systems. "In the Internet Economy, everyone and everything will be connected." Chambers announced that Cisco has formed a Consumer Line of Business to implement its personal networks strategy. It will be headed by Vice President and General Manager Robba Benjamin. "Cisco's consumer strategy will have three key elements," Benjamin said. "First, we will help service providers build high-speed connections to the home and other locations where consumers access the Internet. Second, we will license technology that will help develop network-enabled services and applications that provide unique value to consumers. Finally, we will partner with companies in all sectors of the marketplace." In a related announcement today, Cisco Systems, Inc. and General Instrument Corporation announced that they intend to work with AT&T on a non-exclusive basis to develop and trial a seamless, end-to-end Internet Protocol (IP) solution that would allow AT&T to offer data, voice and video services over the hybrid fiber-coax network now being deployed by AT&T and TCI. The New World network will combine Internet, phone and video services over a single cable line, fundamentally changing the way communications services are delivered to consumers. The network build-out also represents the first major deployment of phone services over an Internet-based infrastructure, using cable lines as the transmission vehicle. Cisco announced broad support for its consumer strategy from more than 30 service providers and consumer electronic companies, each sharing Cisco's vision to extend high-speed Internet access from business to the consumer market. Cisco also announced plans to introduce a new type of 'personalized network' for the home, a sort of plug-and-play local area network, connecting PCs, phones, TVs and other Internet appliances. Cisco also introduced a voice-enabled cable modem at CES, which will allow consumers to get phone service from their cable company, in addition to high-speed Internet access and television service. These personal networks begin to lay the groundwork for Cisco's long-term vision to turn the Internet into the next mass medium, eventually connecting everyone to everything. At CES, Chambers demonstrated a working networked home, using a combination of cable, telephone and wireless solutions. The demonstration featured real examples of broadband consumer products, including a Hitachi set-top box that delivers a standard TV signal with a picture-in-picture Internet connection, a wireless broadband connection from Epigram, connecting a PC and TV for gaming, and Samsung web video phones delivering TV quality service. Chambers also demonstrated a wireless home network using technology from Sharewave, which is up to 400 times faster that a standard modem connection. Cisco's new consumer initiative intends to allow service providers to generate additional revenue from new broadband Internet access services needed for a networked home. At the same time, consumer equipment manufacturers will generate additional revenue through the development of new, high-speed Internet-enabled devices. Cisco will continue to work closely with service providers to facilitate the development of New World data, voice and video services, and also to partner with consumer electronic companies to develop integrated Internet, phone and video devices