Viewpoint: Cisco's Purchase Of Scientific Atlanta Could Be The Most Important Brick In The Digital Home

cable set-top box maker Scientific Atlanta

Cisco now has the potential to become a provider of much of the technology necessary for networked homes. Scientific Atlanta's set-top boxes already include software that allows numerous TVs in a home to connect via cable to a single DVR. The boxes can be integrated with the networked entertainment devices that Cisco offers through KISS Technology, which it purchased earlier this year. Once that happens and Cisco brings in the new VoIP, wireless mesh and other networking technologies from its Linksys division, almost every element that a digital integrator would need for the home would be available through the vendor.

Cisco is also working on deals with content providers to offer video on demand and other services in the home. IPTV is quickly becoming a contender for transmitting television programming or video on demand to homes, and Cisco and its partners would be in the key position to benefit from its growth, controlling the flow of video over pipes into the home and the distribution of the content once it's there. Even if traditional cable wins out as the preferred method of bringing video to the home, Cisco and its integrators would still stand to gain.

Cisco's growing strength can also allow integrators to offer financially-rewarding triple-play services. While the dream of providing the triple play services of phone, Internet connectivity and video entertainment has long been only in the reach of telecoms and ISPs, Cisco could allow even the average integrator to offer triple play at an affordable price. For integrators, triple play would not only bring valuable recurring revenue, but also tie them even closer to their customers.

The vendor is also in the position to significantly widen the home integration market. If Cisco develops standard network and entertainment building blocks that can be customized as needed, its integrators would be able to provide integration services to homes of any size and budget.

The question is if Cisco will develop the channel support necessary to help integrators push this wide array of technologies and services into the home. Earlier this year the vendor appointed Nigel Williams as the new channel chief of its Linksys division. In an interview with Digital Connect during the summer, Williams said the vendor would develop support and assistances programs for its home technology integrators, service providers and other partners. However in a follow-up call this week, a Cisco PR representative said that while Cisco is still talking about developing channel programs for home integrators, no specifics have yet been set and there is no timeline as to when a program would be launched.

Despite the potential that Cisco's acquisitions and announcements offer, integrators should be seriously concerned by the last item. Even the best products and business plans will not succeed without concrete support and assistance to back them up. Look at almost every vendor that has succeeded in the integration market: its not their products alone which did it, but the products combined with training, marketing support, integration assistance and other programs.

If Cisco pursues the route of integrating all of its home technologies, one vendor that it will immediately rub up against is Motorola, the leading set-top box maker which is aiming to build on that status to offer new services to the home. Motorola has been beefing up its boxes to allow them to serve as home gateways, and plans to include in them DVR, security and some control capabilities to allow consumers to monitor their home devices and access their services remotely through the boxes. After Motorola purchased home control vendor Premise Systems in June 2004, it put the company's developers to work on these services.

One positive note for Cisco: Motorola also has been slow to develop a channel program for its home integration products. Dan Quigley, a founder of Premise Systems and currently senior director of product management of the Motorola Connected Home Solutions division, says integrators will be a key part of the vendor's plans for the home, but that no specific program has yet been developed.

Cisco is in the rare position of being a newcomer to the home integration market with the ability to significantly influence how it develops. Cisco is sitting on some amazing assets, and all it needs is some channel help. If Cisco can pull it off, bringing together all of the technologies to build the networked home, along with the support and assistance integrators need, the market will be wide open.

What are your thoughts on partnering with Cisco? Tell Michael Gros, associate editor of Digital Connect , at (516) 562-7276 or [email protected].