Why Cisco Cius Survives While HP’s TouchPad Fails

With
the TouchPad experiencing one of the shortest product lifecycles in IT in the
last few years (some argue the Microsoft Kin had a shorter lifespan, but it did
get a temporary resurrection), analysts are pointing the finger for its
untimely death at a major switch in HP’s strategic focus, product launch delays
and confusing marketing. With the TouchPad officially on the chopping block
seven weeks after launch, what’s in store for other business tablets, most
notably the Cisco Cius?

The
simultaneous announcement that HP would be selling off its PC unit really shows
a difference in the vendor’s focus since the days of Carly Fiorina and Mark
Hurd, both of which were focused very much on the PC business. Current CEO Leo
Apotheker, however, is a different kettle of fish, said Charles King, principal
analyst at Pund-IT. King noted that Apotheker is a data center and software
guy, and with terrible sales of the TouchPad in the first few weeks after
launch, there was clearly a willingness to abandon the product.

“Certainly
patience wasn’t the order of the day,” King said.

According
to Rob Enderle, president and principal analyst of Enderle Group, HP’s
acquisition of Palm delayed the release of the TouchPad. Designed to compete
with the first generation of the Apple iPad, by the time it hit the market in
July, it already seemed out of date and the consumer market had already spoken.
Meanwhile, other tablets being released right now were designed to compete with
the iPad 2.

Mixed
marketing messages also may have contributed to the early demise of the
TouchPad, Enderle said. Was it a consumer tablet or a business tablet?

“The
TouchPad was kind of a mixed beast. It didn’t have a lot of business attributes
to it. The advertising was clearly focused on the consumer. It got lost,”
Enderle said.

It
seems clear that mistakes were made, but what does this mean for business
tablets entering the market, most notably one of HP’s biggest rivals, Cisco and
its Cius tablet?

It’s
likely to be good for Cisco, said Michelle Warren, president of MW Research
& Consulting. Although there has been a lot of iPad adoption by executives
in the business world, IT departments are struggling with managing and securing
the devices. They’re looking for an alternative, and the Cisco Cius, which was
designed specifically for enterprises in mind (Cisco’s own messaging is not
aimed at the consumer at all), is getting some notice. Warren said the Cius is
becoming a popular choice, even though it hasn’t even launched yet. When the
Cius does launch, it will have one less competitor in the business tablet
space, and it’s unlikely Cisco will drop the Cius product line, she said.

“There
is a need for it in the enterprise space,” Warren said. At the very least, it
was designed for enterprise apps and will be easier to manage and secure.

However,
the question regarding all tablets that sell at or above the iPad’s price point
is whether they can be viable in an Apple-dominated business, King said. There
is likely more leeway for business tablets like the Cius, he added.

“Apple
is very clearly consumer-focused, although the company insists the iPad and
iPhone are ready for the enterprise. I think that’s arguably incorrect, but it
may have been a problem with the TouchPad because HP was trying to market it as
being used by both businesses and consumers,” King said.

To
its credit, Cisco has been very clear about its intentions for the Cius, he
said. Its primary strengths are in enterprise computing and collaboration.

“The
environment right now for tablets is extremely challenging, but I think Cisco
is obviously in a place where they’re working very hard to curtail costs and
reduce red ink,” King said. “If the Cius was really bleeding money, it could be
destined for the boneyard, but I think what the company has done to date, at
least, is get rid of those products that weren’t within the purview of its enterprise
focus, like getting rid of the Flip and some of its other consumer-centric product
areas. I think the Cius probably resonates enough with the company’s overall
enterprise-centric mandate that it would make less sense for Cisco to put down
production on that than it would on something on the more consumer-centric side
of the business.”