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May 22, 2001
Laurel Networks hasannounced its first product: the ST200 edge router.The ST200 is designed for installation at the edge of an IP/MPLS network.Laurel’s biggest competitor in this space is Cisco Systems Inc. (Nasdaq:CSCO).
Taking on Cisco at routing would generally be considered a foolish move forany small startup, except for one thing: Laurel’s strategy is remarkablysimilar to that employed by Juniper Networks Inc. (Nasdaq:JNPR) -- the only company that has successfully challenged Cisco’s dominanceof the router market to date.
The key difference is that, whereas Juniper attacked Cisco in the market forcore Internet routers, Laurel is focusing its efforts at the other end ofthe network: the edge.
But has the ST200 got the right stuff? The product boasts an array offeatures optimized for the edge of the network, including high-performancedistributed routing and forwarding functions, as well as dedicated -- or“per-customer” -- virtual routing tables, traffic shaping, class-basedqueuing, and differentiated services. Additionally, the device will usehardware-based counters to collect billing stats, Laurel says.
The ST200 also comes with “multi-lingual” line cards, supporting multipleprotocols. This allows service providers to reduce capex by using the samehardware to route ATM, frame relay, gigabit Ethernet, and IP traffic over thesame backbone -- without having to buy and swap different flavors of card inand out of the router chassis.
“[The ST200] is interesting, design-wise,” comments David Newman, presidentof Network Test Inc..“Virtual routing allows you to dedicate router resources to each customer,and that’s a very smart move -- especially if you are making boxes that arecustomer-facing. The big challenge for Laurel will be keeping the content ofthose tables in sync. If you have N tables, how do you ensure that table 1 has the same contents as table N? That can be a real showstopper.”
Newman says that Laurel faces an uphill battle competing with the likes ofCisco and Juniper, but not an impossible one. “Edge routing is a new market.Cisco is dominant, but not necessarily indomitable. Can a startup make moneyat its expense? It’s possible, and I’d offer Juniper Networks as exhibit A."
Still, it won’t be easy. Cisco isn’t resting on its laurels (sorry). It’salready made some pre-emptive moves to strengthen its edge routing story(see Cisco Puts Service Creation on Edge).Juniper’s product line is starting to look increasingly edgy (seeJuniper Goes to the Edge).Unisphere NetworksInc. also has recently started to make some serious money from sales ofits ERX edge router (see Unisphere Posts 47% Revenue Growth ). And several other startups aretargeting this area, including Amber Networks Inc. (seeAmber Illuminates Edge Product), and QuarryTechnologies Inc. (see Quarry Mines Another Product).
Laurel says the ST200’s biggest differentiator against the products from itscompetitors is speed. “We’re not trying to take folk on in the T1 market. We’re more of a high-end edge play,” says Stephen Vogelsang co-founder and vice president ofmarketing at Laurel. While the ST200 will support T1 (1.5 Mbit/s) connections, where itreally excels is supporting very large numbers of DS3 (45 Mbit/s), OC3 (155 Mbit/s), OC12 (622 Mbit/s), and gigabitEthernet ports, he claims.
Laurel makes no secret of the fact that it is trying to follow in Juniper’sfootsteps, contending the strategy has helped it secure financing.“That’s exactly what we told the VCs, and it made it a lot easier to getfunding,” says Vogelsang. The company has garnered almost $80 million in two rounds of funding(see Laurel Networks Scores Big Round ).
Still, there’s one important area in which Laurel is not following Juniper’splaybook: the poaching of Cisco employees. Juniper made a point of hiringlarge numbers of Cisco software engineers to ensure that the code in itsrouters would be compatible with Cisco’s. This turned out to be a key move.It increased service providers’ comfort level with Juniper’s products andmade it much easier for them to deploy its routers in heterogeneousnetworks.
“I don’t know that we have anyone from Cisco on the development side,” saysVogelsang. “Then again, there may not be anybody left there to take.”
Laurel says it will demonstrate the ST200 at the Supercomm trade show inAtlanta next month.
— Stephen Saunders, Founding Editor, Light Reading
For more information on Supercomm 2001, please visit the Light Reading Supercomm 2001 Preview Site.
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