Logitech gambled big on video conferencing, lost



Logitech gambled big on video conferencing, lost

Logitech’s PR machine is on the loose this morning, trying to dampen expectations before the company announces its quarterly financial results later in the day. The key message is that we shouldn’t expect any great shakes from the video conferencing side of the business. In fact, there’ll be a $211 million charge against earnings, which is big enough to wipe out the previous quarter’s income four times over, and which stems entirely from this source of pain:

“The enterprise video conferencing industry has experienced a slowdown in recent quarters and consequently, through this period, the video conferencing unit has not sustained the growth Logitech originally anticipated.”

That’s a blanket statement, describing a whole section of the industry and not just pinning the blame on LifeSize, the video conferencing company that Logitech picked up in 2009 for $405 million. It so happens that Polycom and Cisco have also reported ongoing slides in video conferencing sales, so Logitech’s explanation is entirely justified — not that it makes the LifeSize acquisition look any smarter.

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Source: Reuters



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