UPDATED 11:39 EDT / MAY 11 2011

Verizon, AT&T To Sell Cisco Tablet

There hasn’t been a lot of good news coming out from or about Cisco (ticker symbol CSCO) lately as the company struggles to restructure its operations and management. The company badly needs a hit product in some area, any area, as questions persist about its growth prospects.

According to an item in today’s Wall Street Journal (wsj.com), the Cius, Cisco’s name for their entry into the tablet computer competition, will be offered by AT&T (ticker T) to its business customers this coming fall. Verizon (ticker VZ) has previously announced the sale of the 4G version of Cius this spring. Neither the carriers or Cisco have provided pricing information.

The Cius, which runs on Google Inc.’s Android software, is Cisco’s attempt to breach the red-hot tablet market. The company is taking a similar tact as Research In Motion Ltd. in attempting to tap its business customers to drive sales of the device. It’s unclear whether that is a strategy that will pay off. RIM’s PlayBook, which like the Cius is a seven-inch business-centric tablet, has only seen modest initial sales. Other companies such as Samsung Electronics Co. have gone after the consumer market first. Few tablets, however, have proven to be blockbusters outside of Apple Inc.’s iPad. The Cius is part of Cisco’s strategy to drive more video-collaboration products in the workplace. More video means more data traffic, which translates to more demand for the company’s network equipment. The tablet can be plugged into a docking device that includes a handset and speaker-phone capabilities.

Cisco’s stock price has been under pressure for quite some time, currently trading at $17.70, well below its 200 day moving average, an indication of poor investor sentiment and support. Fiscal third quarter results will be released after the stock market closes today. Analyst expectations are muted.


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