Cisco paid $590M for the Flip camcorder, then shut the whole division two years later

In May 2009 Cisco paid $590 million for Pure Digital, maker of the Flip — a wildly popular pocket camcorder that had ridden the early YouTube boom. Cisco wanted a consumer hardware brand to sit alongside its networking empire.

The bet soured fast. Smartphones were absorbing the pocket-camera job, and Cisco's leadership concluded it could not be a consumer-products company on top of its core business.

On 12 April 2011 Cisco announced it was getting out of the consumer business and shut down the Flip division entirely — roughly two years after paying $590 million for it.

The product was never the problem; the owner's strategy was. A one-trick gadget in a category smartphones were eating had no place in a company that never treated consumer hardware as its core, so the whole bet was written off.