Cisco Unveils Its Internet Home Initiative

Cisco Systems, the highly respected maker of routers and other hardware that forms the backbone of the Internet is getting in the residential electronic-infrastructure business in a big way. In the past 30 days the company has made a number of investments and product introductions that indicate a long-term focus on bringing high-speed Internet access to homes across the country.

In early July, the company announced a $100 million investment in Liberate, a company leading the charge to bring television and movie broadcasts to the Internet. Liberate does this via a software that enables cable boxes to handle the technically difficult task of synching up words an images from a live flow of binary code.

Two days later, the company made an undisclosed investment in home networking company Home Director, a former unit of IBM Corp. It then followed up with the July 26 introduction of its Internet Home. For now this package of products can be viewed in the form of 1,700 square feet of demonstration scenes it built in its Silicon Valley headquarters. But soon there will be homeowners using the product. The product launch included the announcement of a comprehensive partnership with developers of the West Los Angeles community of Playa Vista, where each of the eventual 16,000 homes will have some type of Cisco package included.

To builders, who have heard every pitch imaginable about home technology in recent years, some homeowner applications envisioned by Cisco are not new. Lights, music and electronic security systems can be controlled with a few keystrokes. The refrigerator knows when its door is ajar and notifies the homeowner via a web pad device. Or it can "enable a child to receive homework help form a parent at work or traveling," a Cisco release notes. But other applications like movies on demand over the World Wide Web and the ability to participate in interactive television and game broadcasts do break new ground.

"The Internet Home drives home the message that always on, high speed Internet connections are available in today's home, whether it is an older home or a brand new development," says Cisco consumer products executive Mike Moone. "It also demonstrates how high-speed Internet connections are as easy to use as turning on a light or water faucet."

The position taken by Cisco also seems to suggest that the ongoing debate about the nature of Internet connectivity in the home-wireless or hardwired--will not be settled anytime soon. The company's Internet Home relies on both.

According to Cisco's Moone, an existing home could be retrofitted with many of its high speed Internet features for about $500 by adding a Cisco Internet Home Gateway and Digital Subscriber Line (DSL) Internet access that is now offered by most local telephone companies and Internet service providers. Homes built with upgraded or standard structured wiring known as category 5, fiber or coaxial cable, have the ability to add a larger array of high speed services for about $1,500. And finally, for a much larger investment ranging from $15,000 to $100,000 homeowners can have a "fully custom" Internet home solution that includes an automated home solution.

In building its Internet Home concept Cisco was able to attract a number of consumer products and appliance manufacturers that are eager to take the technology lead in their respective markets. Whirlpool, Sears, and Hewlett-Packard are some of the notable partners in the project. The harder task will remain winning the support of builders who remain skeptical as to the level of homebuyer interest. Then again, Cisco will be hitting the ground running in this effort with the enthusiastic support of Playa Vista officials.

Playa Vista vice president of marketing Ken Agid says the question of how to incorporate Internet access into each of the development's homes was an "integral part of its community planning and design" process. "We think most of our residents will want to enjoy the benefits of an Internet lifestyle."