Cisco launches “Entertainment Operating System” (EOS)
I spent the day with Cisco’s Eos team a few weeks ago in their shiny SF offices, and learned a great deal about their SaaS platform and intentions to provide a community platform to the media industry, much of my conversation is still under NDA, although they’ve already gone public with this announcement from CNET and WSJ. This project, while we certainly had our suspicions was kept very quiet, and even Cisco’s social media teams I’ve spoken to weren’t fully aware of the project.
Stemming from Community Experience at Five Across
In Feb 2007 (yes way back then) Cisco acquired community platform Five Across, and has since integrated the team with this media solutions business. Their goal? To provide a community platform to the media industry, of course eventually served up on Cisco’s infrastructure. This moves Cisco away from infrastructure (servers, networking, routers) and now to the application space, providing a broader offering to the large networks that don’t just want to put their videos on YouTube for Google to monetize.
New kid on the block will have some challenges
This doesn’t come without challenges for Cisco’s Eos team, as our research has indicated that community deployments are only 20% technology and the other 80% being process, roles, culture, measurement, and change management, this gives Cisco’s Eos a sharp learning curve, they’ll need to combat this with the success the team from Five Across and Tribe have gleaned over the years. Secondly, any new product is going to be plagued with areas to be tweaked, and some media brands may not want to be the early guinea pigs for such a deployment.
Takes aim at Kickapps and Pluck but backed by huge name
While there’s plenty of market share to go around during this growth period, this is a direct insertion into the deal flow of media focused vendors like Pluck and Kickapps, so you can expect brands to be sending RFPs to Cisco’s Eos team for evaluation. While the encumbants have a track record of success and Eos doesn’t have a folder filled with case studies, they do lead with Warner Music and have launched Laura Izibor and Sean Paul (I checked the code, it’s calling Cisco EOS code), they do have two strong things going for them: 1) Cisco’s existing footprint in the enterprise, 2) The thousands in the Cisco sales force and all of their contacts. and 3) Brand recognition from the big, safe, and profitable Cisco.
Over 100 vendors in this space
Exciting times ahead, I’ve just added Cisco to the ever growing list of community platforms –it’s over 100 vendors now.
Key Takeaways
Great move for Cisco as it puts more ‘bits in the pipe’, as online video increases demand for their networking gear. Cisco EOS team will need to demonstrate they offer more than just technology to be successful, media companies need solution vendors –not technology vendors. Competitors now have to compete against infrastructure play and big brand backing. Cisco could drive down prices by offering Eos at bargain prices as a loss leader for other offerings. Social Networking software is a cheap commodity and market is oversaturated, expect a shakeout during this recession. Other large infrastructure players like Sun, IBM, Microsoft, EMC, and CMS vendors will eye the community platform space for buyout –yet startups will resist during periods of low valuation.
Update: Scott Brown from the EOS team has responded to me in the comments, and from the new EOS blog, he says my assessment was fair, which is of course one of the attributes I’m aiming for.
When will Cisco get it that they can be an Enterprise 2.0 player given their brand and if so, how do you find their app compare to the rest of us.
This is an interesting development that will certainly shake the white label social networking space for the reasons you mention. A couple of notes on the news:
1. Cisco has been actively building and supporting customer communities for several years (under both the Cisco and WebEx brands), so I’d argue they’ve been collecting the expertise needed to support the 80% of a community implementation. Whether those people are in a position to influence and support EOS is unclear (read: they should be part of the internal conversations).
2. While the sales force and contacts give Cisco an advantage, it’s not a slam dunk. In my experience, the soft side of social media (suggested by your 80/20 equation) makes it challenging for a traditional technology/software sales force to close the social media/networking deal. They’ll need to build out a strong sales support team that’s articulate in social media strategy in general and the capabilities of EOS in particular. These people do not grow on trees.
3. Kick Apps & Pluck shouldn’t be the only ones keeping an eye on this news. Jive, LiveWorld and Mzinga all have substantial stakes/clients in the media vertical and will need to approach Cisco as a formidable competitor.
Thanks for heads up on this news Jeremiah!
Jim | @jstorerj
Ok, while this sound great on paper and in the press, (wow), I just check the live site and guess what it does NOT even work. (right now)
http://www.cisco.com/web/solutions/cmsg/index.html
I don’t know, from the PDF they have this looks to me like a BLOG and nothing more. Yes, it looks cool and yes, this is powered by Cisco and all, but I don’t see media players going to Cisco for their web community platform yet. Maybe down the road. If Cisco wants to get in the space and push their new platform, they need to buy a company with real clients and than upgrade them. Also, where is the social networking, I did not see a single user profile on the site or the blogs?!
Vassil, (CEO of Blogtronix)
It’s clear this is day one for Eos, I’m sure they will roll out more materials to support the announcement.
Jim,
You’re right, there’s plenty of other players who are going to run into Cisco at the proposal table.
😉
We worked on the very first online community for Cisco (Networking Professionals – http://forum.cisco.com/eforum/servlet/NetProf?page=main ) way back in 2000 with a very smart group of people who saw what communities could do for Cisco. We’re still engaged with Cisco on many of their projects nine years later. The use of communities and social media within and by Cisco has grown exponentially over the past nine years and they have learned a lot. They are a very smart organization…
The acquisitions and internal efforts in the SaaS social media area are a natural extension of their knowledge of the benefits that accrue in using these tools within the enterprise. In addition to offering solid technology, I am sure they will provide very strong strategy and project management services to those media organizations who they work with. I would guess that they will expand their market beyond media at some point as well. 😉
This offering will pay off in the long run for Cisco. More internet traffic and usage translates to more ‘boxes’ being sold. Offering a strong product that utilizes videos, photos, and other features that require ‘big pipes’ along with smart strategies and implementations makes sense.
I suspect that along the way, IBM will also get into this business segment as well. In the same way they bought Rational Software, they won’t miss an opportunitie to enter a fast growing area like social media. Like Cisco, IBM also truly understands the power of social media and use it themselves.
Very interesting times… I expect more consolidation in the software area in 2009 with major players acquiring many of the mid-size companies in the market.
“Social Networking software is a cheap commodity and market is oversaturated, expect a shakeout during this recession.”
Interesting thoughts. The cream should rise to the top and the big differentiators will be those companies that can provide true end-to-end solutions, including Consulting and Management, not just technology.
Thanks for the report.
If they’re going after the media space, as you say Pluck has a huge head start there, an impressive roster of clients and a pretty solid offering.
It’ll be interesting to watch the battle…
~Jim
Mike Rowland, thanks for this, Cisco has a rich history in communities although most don’t recognize it. EOS brings Tribe and Five Across culture with them.
Mike Pascucci, Yup, my upcoming Wave report will be leaning on “Solution Partners” those that provide the 80% beyond the technology. Technology is cheap, quickly outdated, and has low barriers to entry in this space.
Jim, yes I’ll be watching.
Just added their cool cisco inspired logo to the post. Is it a media signal, segment of the GG bridge, or a bowtie?
Good post, Jeremiah. Your key takeaways are very insightful. It will be interesting how the market shakes out in 2009. Thanks for the heads up.
Cisco here. Jeremiah, fair assessment of Eos and the importance of change mgmt/process change along with a new tech platform like this.
Like any new tech, there will be a learning curve with Eos. But with the unified back end, media companies now have a single environment to manage their sites, web assets and human teams — which should give them economies and efficiencies of scale that they aren’t necessarily getting today.
This is definitely the first step in a longer journey for Eos.
Scott
Thanks for swinging by, keep us (David Card of Forrester) posted.
btw,@Vassil comments that the “live site” is not working. His link actually goes to a promotional video on cisco.com that buggy for Macs at the moment.
Much more importantly, as Jeramiah notes, you can see the first version of Eos in action at lauraizibor.com and allseanpaul.com
Pingdom shows that the homepages for both of the initial sites load at 18+ seconds. Utterly unacceptable anywhere, especially for a demo site for a product.
Even worse coming from a leader in network infrastructure.
By pushing more into the application side, Cisco has a leg up on the the other traditional competitors in the networking space. There was a recent a FastCompany interview with Chambers where he said things learned after the 2001 bubble are paying off now. This might be one of those things: driving more application use increases demand for bandwidth resulting in more infrastructure sales.
From all projections, 2009 will be tough for Enterprise networking sales. By continuing to diversify their revenue in applications and consumer, Cisco appears to be more prepared to stick out the economic downturn than their competitors.
Mervyn
Yup, Cisco needs to move ‘up stream’ from the data center to the business side. Their doing that now, with not just social networks but with their other communication tools.
Have you seen the Cisco campus in San Jose? It’s truly it’s own city.
How much help will the Cisco brand name be in the marketing efforts to come? Isn’t it likely that the non-tech decisionmakers won’t even know what Cisco does?
I understand the need for new Advanced Technologies to drive growth, but I’m not sure how much of a long-term opportunity there is here. Very quickly you’re going to run out of media companies that require “a single environment to manage their sites, web assets and human teams” and you’ll be forced to go after smaller clients that can get what they need from existing solutions. And since “Social Networking software is a cheap commodity and market is oversaturated,” you’re likely not to command fat margins with that segment to fuel your growth strategy.
What am I missing?
Vassil, (CEO of Blogtronix)
It's clear this is day one for Eos, I'm sure they will roll out more materials to support the announcement.
Jim,
You're right, there's plenty of other players who are going to run into Cisco at the proposal table.
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