New iPhone 4.0 vs. Cisco's Flip

The new iPhone has been touted as bad news for Cisco's popular Flip camera -- but there's room in the market for both.
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SAN FRANCISCO (

TheStreet

) -- Almost as soon as

Apple

(AAPL) - Get Report

unveiled its

new iPhone

, the device was being touted in the blogosphere as a potential challenger to

Cisco's

(CSCO) - Get Report

popular Flip camera.

Video was a big theme at Apple's Worldwide Developers' Conference (WWDC) this week. Not only did Apple CEO Jobs tout the phone's new front-facing video camera and FaceTime technology, he talked up its HD capabilities, LED Flash, and iMovie, the company's video editing program that has been newly modified for use on mobile devices.

For Apple, it seems that the iPhone 4 is the perfect vehicle for smartphone video chat.

Just as users shifted away from traditional phones to cell phones and then all-singing, all-dancing smartphones, so Apple sees a future where advanced video communication happens at the touch of a button. For phone makers and telcos, this is clearly the next big thing.

Sprint,

(S) - Get Report

for example,

already offers video chat on its HTC-built EVO 4G

.

And for networking giant Cisco, the coming of a video revolution has become a company mantra. Cisco has made a series of video-related acquisitions over the past couple of years and spent $590 million to acquire Flip camera maker

Pure Digital

. While Cisco is still very much an infrastructure company, devices like the Flip camera drive demand for bandwidth, which in turn increases the need for Cisco networking gear.

While there has already been talk that Apple's FaceTime technology could spell bad news for Cisco's Flip (both cameras offer a simple, point-and-shoot experience), the device's lack of bells and whistles -- as opposed to the smartphone's many capabilites -- will mostly likely solidify its place as a business tool

and

a no-frills consumer choice.

Video: iPhone 4 vs. Android EVO >>

The camera requires minimal expertise to operate, something that is proving popular with many casual videographers.

TheStreet

easily used a Flip camera to film part of its WWDC coverage this week,

quickly shooting an iPhone 4 demo

, and then uploading the footage to a laptop via its USB port. It seems perfect for consumers who have neither the time nor the inclination to master new technology.

The iPhone 4, on the other hand, is aimed at a different demographic. The iMovie program, for example, could offer a whole other level of video-making for tech-savvy youngsters who run their lives from tricked-out smartphones.

New video capabilities, an improved display, and better battery life will undoubtedly resonate with the consumers when the iPhone 4 comes out later this month. The phone may give Cisco's Flip

some

competition, but there will still be a market for stripped-down, easy-to-use video cameras.

If anything, the new iPhone may actually help Cisco. The prospect of consumers pushing more and more video data across global networks can only spell good news for sales of switches and routers.

-- Reported by James Rogers in San Francisco

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