So, tell me, is Cisco really holding a fire sale? Why?

At the Consumer Electronics Show in January, Cisco (NASDAQ: CSCO) CEO John Chambers led a spirited presentation on the Future of Television during which he talked about and demonstrated some of Cisco's ideas on how we'd communicate a few years from now.

He talked about umi, video chat, video conferencing and all the other ways that connected TVs would change our lives. He drew applause, some cheers and friendly laughter from the audience, which was, almost universally, intrigued and somewhat wowed by the technology.

What a difference a couple of poor quarters make.

Instead of continuing the hot acquisition streak the company has used to broaden its product line--it's snapped up everything from a pocket-sized video camera business (Pure Digital's Flip camera), to a video transcoding company (Inlet Technologies), to home networking (Linksys), a collaboration platform (WebEx), a telepresence platform (Tandberg) and, well, everything. If it fit the business, or if it didn't, Cisco seemed to have cash it wanted to invest.

This week's rumor is that Cisco now is looking to unload Linksys and possibly WebEx, as the company continues its strategy to get back to basics, but the possibility that it would pare WebEx as part of its restructuring seems odd.

Maybe.

WebEx cost Cisco $2.9 billion in 2007, and it's probably worth at least that much to another company looking for a "name" solution.

It's got a solid client base that's continuing to grow, Cisco just signed aerospace giant Boeing as a customer, and it's used by any number of small- and mid-sized businesses, as well. For the past four years, it's been a key component of Cisco's push into that market.

But there are a couple of questions to weigh.

Chambers earlier this month vowed to cut $1 billion in expenses from Cisco's bottom line over the next 12 month. He said he'd dump underperforming businesses and products and ax as many jobs as it took to get expenses more in line with revenues.

Is WebEx underperforming, especially under the revised metrics Cisco has to be measuring its products by? Does a product aimed not at enterprise customers, but at SMBs make sense to Cisco right now? Is its technology ripe for innovation? In addition to the sales force, how many CSR and tech support positions does WebEx eat up?

In the broader picture, to reach the 5,000-some jobs analysts predict Cisco will have to cut, does it make more sense to ax WebEx or employees from the core business Chambers says he's trying to rebuild? Shuttering the Flip operation, which was a pretty small business, saved the company 550 jobs.

WebEx is beginning to see an awful lot of competitors in the marketplace, both low-end and high. Selling it now, while it still has presence, wouldn't necessarily be a bad thing for the company.

One interesting note this morning comes from Sterne Agee analyst Shaw Wu, who, looking at Cisco, said the stock was "grossly undervalued." Wu said he analyzed the company's business segments individually, and, when he put them back together, he estimated Cisco's value at $27 to $28 a share, way above the $16-$17 range in which it has recently traded.

So, tell me what you think: Why is Cisco shopping so much of its business? Do you really think WebEx is a possible divestiture? Also, if you had $3 billion in spare change, would you buy it?--Jim