Cisco Systems gave investors more proof Tuesday that the term "tech-stock dividend" is no longer a contradiction in terms. The computer-networking gear giant will become the next major technology holdout to start paying a dividend. Cisco said it expects to pay a dividend of 1% to 2% by the end of this fiscal year, which ends in July. Cisco joins tech titans Intel, Microsoft and Oracle in breaking the industry's long aversion to making periodic cash payments to investors. Cisco's move comes as companies are regaining confidence to pay dividends, after viciously slashing them in 2009. Yum Brands also increased its dividend by 19% on Tuesday. So far this year, there have been 179 dividend increases and three cuts announced by Standard & Poor's 500 companies, says S&P's Howard Silverblatt; in 2009, there were 110 increases and 72 cuts through September. "Dividends are coming back," says Susan Byrne, chief investment officer of Westwood Holdings, a Cisco shareholder. "We've pressured Cisco saying, 'We would like a share. You don't need all that money.' " Cisco's entrance into the dividend-paying club is notable for several reasons, including: •A coming of age of the tech industry. Tech still has the lowest yield, 2.0%, of any of the 10 industry sectors, Silverblatt says. But that's not far below the 2.4% dividend of the S&P 500. Tech companies have huge piles of cash. Cisco has more cash, $39.9 billion, than any other S&P 500 company, with the exception of General Electric, which holds much of its cash in its financial arm, Silverblatt says. Google and Apple are the largest tech stocks that still do not pay dividends. •An acknowledgement of demand for dividends. Stock investors, worn down by lackluster stock gains, and bond investors, tired of low yields, are demanding dividends, says Dan Genter of RNC Genter Capital. •A sign companies need to address their mounds of cash. With a record $843 billion in cash earning low returns, companies can't keep investors at bay much longer, says Kevin Shacknofsky, a portfolio manager of the Alpine Dynamic Dividend fund. Dividend payments are still 17% below their 2008 level, S&P says. Genter expects more dividend increases, though a potential increase in the dividend tax rate from 15% next year could cause some companies to wait. "This trend won't be an avalanche until there's visibility into the tax rates," Shacknofsky says. Guidelines: You share in the USA TODAY community, so please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. Use the "Report Abuse" button to make a difference. You share in the USA TODAY community, so please keep your comments smart and civil. Don't attack other readers personally, and keep your language decent. Use the "Report Abuse" button to make a difference. Read more