Shares of Cisco Systems (CSCO) rose 4% Monday ahead of a Tuesday morning announcement the networking gear maker says "will forever change the Internet and its impact on consumers, businesses and governments." Behind the hyperbole, most observers expect the San Jose, Calif. company will introduce of a new breed of networked TV set-top boxes utilizing ultra high-speed broadband to provide both digital video programming and home videoconferencing capabilities.
A new super-charged set top box could be a boon for Cisco, which reported that sales of its video systems fell by approximately $80 million in its most recent quarter, primarily due to decreased sales of digital set-top boxes.
A shift in direct-to-consumer sales might also be positive for the company, which has generally sold its set-top boxes by way of cable companies, placing the company and its brand at a remove from the lucrative direct-to-consumer market.
Whatever new technology is introduced, its roll-out will almost certain rely on broadband partners using Cisco's relatively new line of high-capacity network routing equipment. That line, which Cisco has dubbed "Carrier Routing System," can support a neighborhood full of TV viewers watching "watching various 3D HD content on their TV sets simultaneously, including the movie Avatar, live in 3D on a cinema channel without a hitch," according to a recent blog posting by Mike Capuano, Cisco's director of service provider routing and switching.
Cisco shares sold for $26.13 at market close Monday, up 92 cents from their opening value of $25.27.
Cisco Eyes Ultra High-Speed Broadband