Kriens isn't leaving Juniper, the company he's run for 12 years. He'll stick around as chairman after Johnson, 47, arrives in September to take the CEO job. (See Juniper Appoints CEO.)
News of the switch broke late yesterday. (See Report: Juniper Finds... a CEO?) Separately, Johnson apparently sent a goodbye email to his 14,000 employees at Microsoft without specifying where he was headed.
Johnson is certainly experienced at running large, high-stakes operations. As president of the Platforms and Services division, he ran strategy for Windows and for Microsoft's online services, a position that put him in battle with Google (Nasdaq: GOOG). He was also responsible for Microsoft's attempts to acquire Yahoo Inc. (Nasdaq: YHOO).
Johnson's appointment continues a quick string of executive hires at Juniper. Just this month, the company brought in Luis Avila-Marco from Cisco to be its chief strategist, eyeing mergers and acquisitions. It's also hired John Morris, a biometrics industry executive, to run worldwide field operations. (See Juniper Nabs Cisco Strategist .)
More details about the CEO transition could emerge this afternoon, when Juniper is scheduled to announce quarterly earnings.
Juniper stock was down 56 cents (2.5%) at $22.33 in midday trading.
I was refering to their market share with the global Tier 1 carriers. You are right their total market share bounces around 30%. However it is the Tier 1s who keep the core router companies alive. If they stumble with the tier 1s their market cap could go below $10B maybe lower. Today they are $13.4B market cap with around $2.2B cash on hand. Ericsson is at a market cap of $34.5B with around $10B cash on hand after a beating in the market over the last two weeks. Hauwei is also flush with cash and seems to be divesting their losers and building up even more cash.
It is easy to envision a scenario were Redback cannot deliver a core router, Juniper stumbles and gets no traction in enterprise ethernet and ericsson or huawei swoop them up.
With only $2B cash on hand there is nothing Juniper can buy that would put them in a more competitive position unless they used debt financing. Even though say they could afford a $4B+ acqusition -- who would they buy.
They really do not have many options and getting traction in enterprise is going to be tough. Cisco has cable locked up as well as the Tier 1 telcos.
Finally Juniper has no services or field engineering organization to speak of and again the Tier 1 Telcos have been waiting for Juniper to step up their game as a partner and they have not. No leadership, no vision, no services.
Kevin has a job for which he has no experience or deep relationships. Must have wanted to get away from SteveB desparately.
Perhaps this is the transition point were Juniper ceases to be the engineering and innovation driven company that it has been acknowledged to be. Like most large companies, the CEO's credentials would be largely "constrained" to their ability to run a business, not to provide vision and lead innovation in a given domain.
We'll miss you, Juniper, in the form that we had grown to grudgingly admire.
PS:As should be clear, I do not own JNPR stock or work for them.
Delphi, I am not sure I completely agree with your comments regarding the company's performance. Juniper has roughly 1/3 of the core IP routing market and it's really a 2 horse race. In addition, I think the growth of the company in the last few years has been pretty impressive when put in the context of other peers in the industry. Juniper is not Cisco, but I would say they are much more than a counter weight - but that's a different discussion.
I am curious who you think might be a potential acquiring company for Juniper. I would guess the list is fairly small as there really aren't too many companies who could digest a company of 6k people with a 12B mkt cap. Who would you include in your list?
Lastly, I took the move to bring in someone who has grown an organization before - purely a business acumen decision, rather than filling a need for an industry heavyweight. I think it remains to be seen whether he's a good choice or not.
He is not going away, just hand out the responsibility. If things do not go the way as planned, he is ready to come back at any moment. He should be applaused for his unselfishness and open-mind. Kevin's hiring is to strengthen or enhance their enterprise strategy and Kriens will still be championing the carrier biz which Kevin should be happy to lean off and learn.
Good point about Microsoft not being a global-carrier kind of house. Johnson's experience with the enterprise seems like it would come in handy, though; that's where Juniper could use some more experienced help.
Separately: There's a brief mention on the Juniper earnings call that makes it sound like Johnson was part of an executive recruiting drive in general, kind of a sweep, rather than a CEO search specifically: http://www.lightreading.com/document.asp?doc_id=159983
He is a great person, but the wrong person for Juniper. MSFT has never developed strong relationships with the global carriers, so they must be banking on enterprise to save them from acuqisition. They have been kept alive as a counter weight to Cisco, they have a small percent of a big number for core IP routing. That is a great company but they have gone no where for years. I doubt they will make a dent in enterprise even with a new CEO.
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