Router company Juniper Networks' acquisition of
NetScreen Technologies has been seen by analysts as an attempt to
gain ground against Cisco Systems in the enterprise network arena,
although they admitted that nothing is likely to happen in the near
future.
Last week, Juniper agreed to acquire NetScreen, a supplier of
firewalls and virtual private network technology, in a stock deal
valued at approximately $4bn.
A top Juniper executive downplayed the notion that the deal was
designed to bring the company into a new market, but pointedly
dismissed the distinction between carrier and enterprise networks.
Christine Heckart, vice president of marketing at Juniper, said the
aim is to provide networks reliable and flexible enough to keep all
kinds of fixed and mobile devices connected.
"The whole distinction between service provider and enterprise
is very outdated," she added.
"If you need a virtual resource, a network that will respond to
your business needs and a network that is mission critical ... then
you're in our customer base. How you classify your business is not
going to determine whether or not you're a viable target customer
for Juniper."
Juniper was founded in 1996 with financial backing from some of
Cisco's biggest rivals, and headed for Cisco's traditional stomping
ground at the core of large IP networks. Despite Cisco's head start
of several years in the router industry, Juniper has made
significant inroads in service provider networks.
In 2003, Juniper captured 31% of the world's revenue for
high-end routers, those that offer interfaces of 10Gbps or higher,
according to Dell'Oro Group analyst Shin Umeda. That represented a
gain of five percentage points from 2002, while Cisco's share fell
five points to 62%.
However, Juniper does not make routers for enterprises and has
not had a way to sell to those customers if they did, according to
Frank Dzubeck, an analyst at Communications Network Architects.
Juniper's market share in that segment is minimal by design,
while Cisco holds more than 90% of the market, said Dell'Oro's
Umeda.
Dzubeck believed the NetScreen acquisition is an attempt to
change this state of affairs.
"This is Juniper's way to get into the enterprise," he said. It
can take advantage of NetScreen's sales channels and save itself
the time and expense of building up its own organisation for that
job. Over time, it also can boost the capabilities of its routers
for service providers by adapting NetScreen's security technology.
With it, service providers might be able to filter out viruses from
e-mail and stop denial-of-service attacks."
Putting those services in the carrier network rather than at the
enterprise would be a good idea, he said, citing the recent MyDoom
attack that hit the SCO Group website this month.
"Why couldn't that have been filtered out before they got
bombarded? There's an awful lot of things that can be done if the
edge of the network and the core of the network turn out to be
incredibly intelligent," Dzubeck said.
Being able to get those kinds of protection from a service
provider could be a boon to enterprises, mainly at their branch
offices, said Yankee Group analyst Zeus Kerravala. At corporate
headquarters, firewall functions will probably remain in place,
although they will move from specialised appliances into
sophisticated routers or switches, he added.
Kerravala agreed the vision of more built-in security is shared
by Cisco, although he admitted Juniper will face an uphill battle
if it tried to take on Cisco in the enterprise.
Over the years, Cisco has built a broad lineup of routers,
switches and other devices for different-sized companies and many
parts of the enterprise. Juniper's history so far has taken the
opposite track, as the company focused on building one type of
product well.
"Juniper's just a very sharp hunting knife. ... Cisco takes much
more of a Swiss Army approach," Kerravala said.
Stephen Lawson writes for IDG News Service