Juniper Networks: Mobility and cloud markets
With a recent series of major announcements under its belt, will Juniper achieve its ambition to shake the market with its groundbreaking vision? Caroline Chappell reports.
Juniper Networks has been busy since the start of 2011. "Over a 90-day period, we have delivered three big disruptions to the market," comments Kim Perdikou, executive VP, office of the CEO. In February, Juniper announced radical offers for the mobility and cloud markets and in March unveiled its groundbreaking vision for the converged ‘supercore’, the bringing together of Layers 1 to 3 of the network in a single packet optical switch that "combines the flexibility of MPLS with optical transport," according to the company.
Juniper’s PTX series packet transport switch – based on a new chipset, Junos Express – won’t be available until the end of the year, but Juniper expects it to set market records. It will scale up to 3,800Tbps and with a throughput of 480Gbps per slot, will be twice as fast as Juniper’s T4000 core router announced in November 2010 and which it currently claims to be the industry’s fastest and densest IP/MPLS router. The PTX series is said to consume two-thirds less power than competitive products and Juniper anticipates that its converged footprint will save costs of up to 65% over legacy, hierarchical switch and router solutions.
The company won’t say who is on the waiting list for the new switch, although Perdikou comments: "Our supercore architecture has been many years in the making. Every major service provider has had early visibility of the product and has given feedback." Verizon is likely to be an early adopter, having made no secret of its desire to collapse packet and optical transport layers to cut costs as, like other Tier 1 carriers, it has struggled to cope with the relentless growth in IP traffic.
Large and overscaled?
Market disruption has been Juniper’s goal from its inception, when its first routers outpowered those from its rival and dominant player, Cisco. At the time, the market was sceptical about the need for such large and ‘overscaled’ products, but Juniper’s vision of the boom in IP traffic – and of service provider migration to IP – turned out to be correct. Born at the start of the dot.com boom, as the web began to filter into public consciousness, Juniper was well placed to predict the future. Its founder, and still the driving force behind the company’s innovation, Pradeep Sindhu, continues to place astute bets on the next technology breakthroughs. Perdikou claims that Juniper is ‘unique’ in its willingness to "disrupt our own markets if it’s what’s right for the customer and if we feel that it’s where the market is going."
The PTX series will potentially cannibalise revenues from other conventional Juniper product lines but Juniper views this as natural market evolution. The company eases the pain, both of its own development and of customer migration, by maintaining the same code base across its entire product portfolio, including security, switching and routing equipment lines. "We were still a small company when we realised, after our first couple of acquisitions, that we needed to do this, so we made it a core part of our strategy," Perdikou points out, adding that the size of some of Juniper’s competitors have prevented them from achieving the same goal. Juniper’s Junos operating system not only provides consistency across its products, it preserves value for ISV partners and customers that have built application function on top.
Junos’ openness and growing developer ecosystem is a distinct competitive advantage for Juniper, which has launched a cloud version of its Junos SDK, a developer platform called Junos Space. Junos Space now incorporates the Eclipse developer environment "so that we can plumb the world of IT into the world of IP and attract innovation to the network," as Paul Gainham, director of service provider marketing for Juniper EMEA, puts it. Complementing Junos is its client runtime, Junos Pulse, which enables Junos applications to be extended across the network to end-user devices, including smartphones. Juniper has over 100 companies working with its Junos APIs.
In support of the cloud
Juniper’s second innovation this year is also aimed at cutting network owners’ costs and improving performance. Virtualisation and data centre consolidation in support of cloud services are leading to an exponential increase in the number of virtual and physical data centre end-points. These need increasingly complex switching hierarchies to connect them, which are both expensive to build and affect latency, leaving cloud service providers to make difficult trade-offs between performance and cost.
Juniper started investing in a development programme to ameliorate this situation in 2007 and in February 2011, announced its fruition: the QFabric data centre switch. QFabric is a logically single, physically distributed switch that will be able to scale across the data centre to support horizontal, any-to-any connectivity of resources (servers, storage and Layer 4 to 7 appliances). QFabric makes every resource appear local to every other resource, with only one low-latency hop between them.
"QFabric is a true disruptive innovation," according to Gainham. Rival vendors, such as Cisco and Hewlett-Packard, introduced converged server and switching platforms to the market in 2009 but Juniper claims these haven’t solved the switching problem in the same way as QFabric will across an array of virtual and physical resources. Migrating to Cisco’s UCS platform is less evolutionary than Juniper says moving to QFabric will be: the first components of QFabric, the QFabric Nodes that replace line cards in switching chassis, are able to work with existing switching infrastructures so service providers can migrate to full QFabric capabilities over time, as their hierarchical architectures run out of steam.
Juniper’s third target market for disruption is the mobile market as it embraces IP. The company already has high profile WiMAX operator customers on its books but is gunning for LTE players. Many of these have wireline operations that use Juniper kit – AT&T and Verizon spring to mind here. In February, Juniper announced a portfolio of solutions to help mobile operators implement the mobile packet core (evolved packet core [EPC] in LTE-speak) as a software-based extension of the existing IP core network that FMC operators already have in place. "Ten years ago, a mobile operator bought an end-to-end solution with the radio access network (RAN) integrated with the rest of the network," Perdikou points out. "As they move to IP, an architectural transition is taking place which is creating a dislocation between the RAN and the mobile packet core. AT&T has been grappling with the question of where the EPC lives and has decided it will be included in the IP domain." As other mobile operators follow AT&T’s lead, this gives Juniper a big opportunity to sell switching and routing products enabled with its MobileNext EPC solutions, including security solutions and Junos Pulse for mobile clients.
An innovative engine
Juniper has a narrower product portfolio than some of its competitors but the company estimates that this still adds up to a $60 billion opportunity for routing, switching and security products and therefore plenty of room for growth. Its supercore product gives it access to a
$6 billion market for converged Layer 1 to 3 solutions and it expects QFabric to make good headway in a switching market worth around $21 billion. The security market is highly fragmented and the mobile element – as smart devices present new security threats – is currently not well-documented, Perdikou says. But Juniper believes it can play a growing and lucrative role here. The fact that the company sticks to its product set makes it attractive to the likes of Ericsson, an early investor which rebadges Juniper routers within its GGSN product; NSN, which resells Juniper kit in its Carrier Ethernet solutions; and OEMs, Dell and IBM. Juniper kit underpins IBM’s cloud platform solutions and IBM was an investor in Project Stratus which yielded QFabric.
Sindhu and his team in the CTO’s office are already working on the next wave of disruptive technologies aimed at reducing costs and implementing functions that will keep Juniper and its customers at the forefront of the market. Juniper’s innovation engine, which starts with a blank sheet of paper and no preconceptions about how to solve an emerging market challenge, typically takes five to seven years to bring a solution to market. At any one time, the company is working on new ideas in three to five areas of interest.
Perdikou hints that Juniper is "looking ahead to the new questions around service experience that will emerge when cloud and mobility take hold," but will say no more than that the company "intends to move up the software stack and support the more rapid roll-out of services." One of the ways Juniper is already doing this is through its venture capital fund which is helping small, disruptive applications vendors to integrate with Junos: some of these companies, in areas such as mobility, video monitoring and VoIP, it ends up buying to extend the applications portfolio it can offer to customers.
With three major announcements under its belt, the company’s focus for the remainder of the year is to deliver its promised product innovations. By the end of 2012, Juniper expects to have had a radical impact on the data centre and networking landscape with its new architectures and improved cost/performance ratios for its customers. The company knows it is on a roll but recognises there is no room for complacence. Perdikou repeats its mantra: "We continually ask ourselves how we can innovate and provide disruption to the industry," she says.
History: Juniper Networks was founded in February 1996 by Pradeep Sindhu. His vision was that routers needed to become much larger, faster and smarter to cope with the coming onslaught of internet traffic. Although venture capital firms were unconvinced, Sindhu secured financial backing for his start-up and Juniper broke the mould with its 1998 release of the M40 router which supported throughputs up to 100 times faster than competitors’ boxes. Juniper has continued to release innovative products, augmenting its internal development capability with a string of acquisitions over the past 10 years, including Trapeze Networks, a wireless LAN company; Altor Networks, virtualisation security player; and Brilliant Telecom, a supplier of IP network synchronisation equipment. Today the company employs over 8,700 staff and has offices in 53 countries.
Ownership: Following an IPO in 1999, Juniper became a public company and in 2009, it joined the NYSE.
Financials: Juniper reported 2010 revenues of $4.093 billion, a 23% rise on the previous year, and net income of $618.4 million.
CEO: Kevin Johnson from September 2008, formerly at Microsoft and IBM.
Products: Routers, switches, security, application acceleration, identity policy and control, time synchronisation, network
management and network operating system software.
Customers: The world’s top 130 service providers, 96 of the Fortune 100 companies, over 30,000 enterprises and public sector organisations worldwide. Sample telecoms customers include: AT&T, Verizon Wireless, Comcast, China Telecom, China Mobile, SingTel, STC and Telecom NZ.