CISCO HAS launched a $599 home videoconference system, a high-quality rival to Skype and other low-cost providers, as the network equipment maker seeks to expand in the consumer market.

The product will be available in the US next month, and can be pre-ordered on Cisco’s website. It is expected to launch in Europe next year, but no pricing has been set.

The high US price, and a $24.99 monthly fee, may make it tough for Cisco to win much of a following among consumers, many of whom are using free online video chat services, analysts said.

But they also said the move shows the company is set on keeping up double-digit revenue growth even as its traditional routing equipment business matures, by expanding its target from business clients to consumers.

“I think the difficulty is probably the monthly price. $300 a year forever, that’s a lot of money,” said Gartner analyst Ken Dulaney. “But this is a premium product. And I think it will set the imagination off with a lot of people.”

The home TelePresence system, called “umi”, features a camera and console that connects to a standard high-definition TV and works over high-speed internet. Its biggest selling point is high quality, real-time video without the pixelations and interruptions of low- or no-cost online services. It also allows unlimited calls, video messaging and video storage.

Cisco already sells a high-end videoconference system for businesses. These systems, often built to simulate boardroom-like settings, can cost about $300,000 per unit. Despite initial scepticism about the price, TelePresence has become one of Cisco’s fastest-selling products.

– (Reuters)