Juniper Networks’ new carrier Ethernet router, the MX960, will bring about the end of the market for carrier Ethernet gear, Juniper chief executive officer Scott Kreins said during the company’s third-quarter earnings call late Wednesday.

“We’re not in a position to declare this until we watch product shipments and outcomes of decisions materialize, but I think you’ll see the 960 is far more than just our participation in the carrier Ethernet market segment,” Kreins said. “I think it’s going to be the end of the carrier Ethernet market segment.”

Unveiled hours before that statement, the MX960 is Juniper’s most Ethernet-centric product to date, a very high-capacity (480 Gb/s) core aggregation platform that combines Layer 2 switching with Layer 3 routing functions.

“There is a market for IP infrastructure, and we have an operating system footprint that runs across the core, the edge and now the aggregation layer,” Kreins said. “It isn’t a segment. It’s just a vehicle on which the IP infrastructure--in our case Junos [Juniper’s operating system]--gets delivered. We look at the marketplace as a market for the operating system, with delivery vehicles, as opposed to the hardware on which it is delivered.”

Kreins made the comments as revenue from the company’s “infrastructure” (or router) segment--which contributed 60% of Juniper’s total revenue--is down sequentially for the third quarter in a row. At $346 million in the third quarter, it is down 4% from a year earlier. Meanwhile, Juniper’s services business is up 33% from a year earlier to $106 million. Contributing 19% of the company’s total revenue, services are still the smallest of Juniper’s three segments--but just barely. The company’s security business, up 13% from a year earlier to $122 million, represents 21% of total revenue.

Kreins cautioned analysts against reading too much into the routing and services revenue trends. He attributed the rise in service revenue in part to accounting practices that require certain revenues to be categorized in that segment. And he said the service business is often driven by products as the company serves its installed base of product customers. As for routers, Kreins said, “What you see reported is less than what has been shipped and paid for.”

Going forward, the growth of peer-to-peer video content could have a dramatic effect on router demand, Kreins said. If Internet users increasingly send video to one another the way they send e-mail today, it automatically creates demand for more router capacity, he said. If users then demand more quality in that video, it drives demand for router functionality. “At this point we’re still watching peer-to-peer video to see how mainstream it becomes,” he said.

“Strategically I’m probably more confident today than I’ve ever been,” he added.