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Juniper cranks up the core

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“No network market has ever been won from the outside in,” said Scott Kriens, CEO of Juniper Networks, in a quarterly earnings call last year. “The battlefield is littered with access and hardware companies that have tried.”

He was talking about the strategic importance of core routers in a router portfolio because they act as linchpins in the network, making it easier for vendors to sell edge and access gear to the same customers. What Kriens didn't mention is that the battlefield is also littered with companies that tried to build a business on the IP core: Avici Systems, Caspian Networks and Chiaro Networks all eventually surrendered. Thus, the core router market today belongs essentially to just two vendors: Cisco Systems, which has roughly two thirds of it, and Juniper, which has the other third.

While Cisco has been boasting that orders for its CRS-1 core router have reached about $ 1 billion annually, Juniper struck back this month, unveiling a new router it claims is more than double the capacity of the CRS-1. Juniper's fourth-quarter introduction of the new T1600, which has 1.6 Tb/s of throughput in a half-rack chassis, is the deed that backs up Kriens' words about the importance of the core.

Those words might also be persuading other vendors as well. Alcatel-Lucent and Foundry Networks may be developing new core routers soon, according to Nikos Theodosopolous, an analyst for UBS, but they're unlikely to upset the current duopoly.

Still, the core may get hotter. The IP/MPLS core market was up 11% from a year earlier to more than half a billion in the first quarter, according to Ovum-RHK. Foundry took just 1% of that market. But as Simon Leopold, an analyst for Morgan Keegan, wrote recently, “With Foundry's prices at 20% of the big guys, it's a threat.”


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