Published on: April 13, 2011by Kevin Coupe
It was just four years ago that the first Flip video camera - pocket-sized, easy-to-use, and relatively cheap - went on the market, trumpeted both by positive reviews and an effective marketing campaign.
As the New York Times reports, the Flip “quickly dominated the camcorder market.
The start-up sold two million ... cameras in the first two years.”
It was so successful that the founding entrepreneurs sold the Flip to Cisco Systems in 2009 for $590 million.
Yesterday, the Flip run came to an end. Cisco announced it is shutting down the Flip business, conceding that the rapid growth of the market for smart phones - which often include video cameras - made its investment a poor one and its Flip division virtually obsolete.
As the Times notes, “Even in the life cycle of the tech world, this is fast ... the rapid rise, and now demise, of Flip is ... a vivid illustration of the ferocious metabolism of the consumer marketplace and of the smartphone’s power to destroy other gadgets.”
Part of the problem seems to be that the Flip was an odd fit for Cisco, which never really committed continued innovation and marketing of the product.
There are a number of lessons here. One is about the importance of continued innovation. You can’t just make a single investment and expect it to bear fruit in perpetuity.
Another is that there is no such thing as an unassailable business model, no such thing as an unassailable advantage. Everything is assailable. Everybody is vulnerable.
And finally, there is the lesson about the speed of change. These days, as they say, it seems to be faster than a speeding bullet...
And that’s our Wednesday Eye-Opener.
- KC's View: