Cisco to Enter the Home, Take on Skype

Story updated with Cisco response.

SAN JOSE, Calif. ( TheStreet) -- Cisco ( CSCO) is set to bring its high-end videoconferencing technology into the home, according to the Wall Street Journal, marking the next big push in the company's consumer products strategy.

Cisco hasn't officially announced the venture, although it will likely come during a Cisco webcast scheduled for Wednesday. In a press release, Cisco heralds the event as "a new consumer experience."
Cisco

Citing a person briefed on the matter, the Journal reports that the Cisco system includes a video camera and a device that connects to high-definition TVs. The system will be priced at $600 with a $300 monthly subscription fee.

Cisco is also likely to draw on its telepresence technology for the new announcement. A form of high-end videoconferencing, Cisco's telepresence was initially aimed at corporations, but the company has dropped hints that it intends to push the tech into home offices.

At the CES show in Las Vegas earlier this year, Cisco CEO John Chambers ran a series of demos using telepresence to speak with people in other parts of the U.S., including his wife in the San Francisco Bay Area.

Although Chambers didn't unveil new products during his hour-long presentation, he promised that Cisco's video strategy will be completely "device agnostic." Video, for example, is seen as an ideal use of tablet computers such as Apple's ( AAPL) iPad.

The tech bellwether has made inroads with video over the past few years, acquiring Norwegian videoconferencing specialist Tandberg last year and Flip camera maker Pure Digital.

During Cisco's recent fourth-quarter conference call, Chambers said that the Tandberg acquisition, combined with telepresence, brought in revenue of approximately $370 million, a 40% hike on the same period last year. While a drop in the ocean compared to Cisco's total revenue of $10.8 billion, videoconferencing has become a cornerstone of the company's long-term strategy.

Chambers has already predicted a home entertainment revolution, which he says will see the worlds of TV and Internet collide. In addition to opening up a new revenue stream, an increase in video traffic will drive demand for Cisco's core networking gear.

Of course, as Cisco continues its push into the consumer market, a new videoconferencing-at-home venture would pit the company against established players like Webcam maker Logitech ( LOGI) and Skype.

Shares of Cisco dipped 3 cents, or 0.14%, to $21.88 on Monday as the Nasdaq slipped 0.23%.

"Cisco will be announcing a new consumer product at a press event in San Francisco on October 6th, 2010," confirmed a Cisco spokesman, in an email to TheStreet. The company, however, has no additional details to provide at this time, he added.

--Written by James Rogers in New York.

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