Here's the scoop.  Cisco bought the company that produced Flip video cameras and even though the cameras  STILL have a 26% market share, it's just not enough.  It appears that the company is narrowing it's business focus in an effort to please investors.  There's also no word on why the company is folding the division instead of selling it.  Here's more from USA Today:

A week ago, CEO John Chambers acknowledged criticism that the company has been spreading itself too thin. He sent employees a memo vowing to take “bold steps” to narrow the company’s focus.

2.5 Million Flip cameras were sold last year.  Even though this is tops among dedicated video cameras it's seen as basically nothing compared to phones and still cameras that shoot video.