HPE CEO Antonio Neri said the $14 billion acquisition of Juniper Networks will disrupt the "status quo" in the networking space with a new modern AI-driven network architecture.
"We are driving this acquisition because we believe that the combination of HPE and Juniper Networks will fundamentally change the networking industry, not by eliminating products from either portfolio, but by creating more choice in the space," Neri said in a blog post about the potential competitive impact of the acquisition. It's incredible that a combination like this has strong products on both sides, and by bringing them together, we're accelerating value and flexibility for all of our customers." ”
Neri did not directly name rival Cisco, which has dominated the networking industry since the mid-'90s, but said the deal targets the current state of the network.
Our goal is to better address customer challenges and disrupt the status quo by bringing together two of the most innovative and competitive organizations in the networking industry. The combination will create a new full-service network company with a customer-centric approach to product development and a comprehensive portfolio of products that deliver value to customers. ”
Neri's letter comes just a day after Cisco announced a partnership with AI GPU giant NVIDIA to help enterprises "quickly and easily deploy and manage AI infrastructure" using "Ethernet-based purpose-built solutions" sold by Cisco's partner network.
Mr Neri said the deal with Juniper Networks strengthened HPE's ability to capture the "huge" opportunities presented by AI.
"The acquisition of Juniper Networks will accelerate our ability to capture the tremendous opportunities presented by AI and provide modern AI-driven network structures for training and deploying AI applications, while shifting our HPE portfolio to higher-growth, higher-margin areas of the market." "Juniper Networks is a complement to our amazing HPE Aruba networking portfolio for campus and branch offices, providing opportunities to accelerate growth in AI, data center, service provider, and cloud." ”
According to IDC, Cisco's revenue share in the Ethernet switch market was 472%, HPE and Juniper Networks each have a share of 71% and 29%。
Meanwhile, Cisco's combined revenue share for service providers and enterprise routers in the second quarter of 2023 was 35., according to IDC9%, while Juniper Networks has a routing revenue share of 103%。
Patrick Shelley, CTO of PKA Technologies, a solutions provider based in Montville, New Jersey, said HPE's acquisition of Juniper Networks would spark an epic cyber war with Cisco.
"That's what Antonio said, 'Here we come, Cisco,' and we're excited to see how HPE can integrate the portfolio to leverage Juniper Networks' AI capabilities in the most advantageous way," Shelley said. For the first time in decades, a competitor has been able to take on the opportunity presented by AI to challenge Cisco with ambition in the networking market. ”
Shelley said the shift in the AI market is a "perfect storm" for HPE to challenge Cisco. "Gone are the days when it was never wrong to buy Cisco as AI has transformed the online market, and customers are now more interested in the best technology than on a well-known brand like Cisco. HPE-Juniper also has a great opportunity to be able to change the game in the networking market with innovative AI networking solutions. ”
While it is too early to make any decisions about the future HPE-Juniper product roadmap, NERI promises that all decisions regarding the HPE portfolio will remain "prudent and well thought-out".
In addition, he said, "All products currently sold by HPE, including hardware, services and solutions available through HPE Aruba Networking Central, remain available for purchase, and all of our standard end-of-life policies remain in effect." ”
He also pledged that HPE will "minimise the impact" to customers and partners as it closes the blockbuster deal, which is scheduled to close in late 2024 or early 2025.
"HPE has a proven track record of seamlessly integrating new products into our portfolio, and with the acquisition of Juniper Networks, we intend to continue that approach by ensuring that our customers and partners receive uninterrupted service while benefiting from an expanded product portfolio," said Neri. ”
He said HPE will maintain all ongoing interactions with customers and partners, including partner advisory board meetings and HPE Discover's HPE Aruba Atmosphere Edge program, pending regulatory approval of the deal.
The eventual merger will enable HPE Juniper Networks to drive more innovation faster, he said. "This is a good thing for us, our customers and partners, and the industry as a whole. ”