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Report: Juniper Still Gaining On Cisco

Light Reading
News Analysis
Light Reading
2/22/2001
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Juniper Networks Inc. (Nasdaq: JNPR) increased its share of the core router market last quarter, while Cisco Systems Inc. (Nasdaq: CSCO) lost share proportionally. So says the latest report on WAN routers from The Dell'Oro Group.

The firm's figures highlight a trend toward Juniper gaining on Cisco in this market -- a trend that's continued all year (see Juniper Eats Into Cisco's Lunch). Dell'Oro's figures also illustrate a segment marked by enormous growth and fierce competition -- one in which neither Cisco nor Juniper is assured of future dominance.

Core Router Shipment in $millions According to Dell'Oro, Cisco's share of the total market for core routers -- represented by sales of its GSR 12000 series -- slipped from 69 to 65 percent during the period from the third to fourth quarters of 2000. In contrast, Juniper's sales of its M160, M40, and M20 routers rose from 30 to 34 percent in the same period.

Still, Cisco's hardly hurting. The overall core router market for 2000 was $2.4 billion, Dell'Oro says, and Cisco enjoyed a 71 percent slice of the pie, compared to 28 percent for Juniper.

In the last quarter of 1999, the overall market for core routers totalled $270.2 million, of which Cisco owned 78 percent and Juniper just 17 percent. A year later, the overall market was valued at $836 million in the same quarter, and Cisco's share has dropped by 13 points while Juniper's has increased by 17 points.

Meantime, Avici Systems Inc. (Nasdaq: AVCI; Frankfurt: BVC7) has crept into the picture. That vendor's sales of its Terabit Switch Router grew from a third-quarter total of $4.4 million to $8.8 million in the fourth quarter 2000. Avici now holds one percent market share.

Some industry sources dispute Dell'Oro's figures. For one thing, folk aren't convinced that comparing only Cisco's GSR 12000 series, and not its other high-end routers, against the Juniper M160, M40, and M20 is valid. That is because the 12000 is generally considered strictly a core switch, while the M20 mainly occupies the network edge.

Dell'Oro admits that it needs to revise its taxonomy. Until now, the firm has put all core routers into a category called "WAN Core and Edge Routers," reflecting its perception that high-end routers are used in both backbone and edge networking applications. Now, as the market segments become more clearly delineated and a new breed of smaller routers emerges solely for the network edge, Dell'Oro admits it's time for a new tack.

"We hope to have new categories in next quarter's report," a spokesperson says. Still, it remains to be seen whether the new cut will satisfy those who clamor for a closer comparison of like to like in Cisco's and Juniper's product lines.

Another sticking point for many is that Dell'Oro includes revenues from service and support in its Juniper figures, but not in those for Cisco. The firm says this is because it takes revenue figures directly from vendors, and in Cisco's case those figures do not include service and support.

Still, Dell'Oro feels the comparison is valid. "We estimate that service and support would add 5 to 10 percent more to Cisco's figures," a spokeswoman for Dell'Oro says. "But that wouldn't change the trend. The numbers still tell the right story."

-- Mary Jander, senior editor, Light Reading http://www.lightreading.com

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pingu
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pingu,
User Rank: Light Beer
12/4/2012 | 8:51:03 PM
re: Report: Juniper Still Gaining On Cisco
Correct me if I'm wrong, but didn't Mary Jander devote fully half her article to questioning the validity of Dell'Oro's methodology?

Mary could have simply reported Dell'Oro's findings with no additional information. However, she dug further and found the story within the story. Good journalism IMO, and FAVOURABLE to Cisco. However, I would have titled the piece as "Dell'Oro says Juniper Gaining on Cisco" or maybe "Is Juniper Gaining on Cisco?".

Regards,
pingu
pingu
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pingu,
User Rank: Light Beer
12/4/2012 | 8:51:03 PM
re: Report: Juniper Still Gaining On Cisco
Correct me if I'm wrong, but didn't Mary Jander devote fully half her article to questioning the validity of Dell'Oro's methodology?

Mary could have simply reported Dell'Oro's findings with no additional information. However, she dug further and found the story within the story. Good journalism IMO, and FAVOURABLE to Cisco. However, I would have titled the piece as "Dell'Oro says Juniper Gaining on Cisco" or maybe "Is Juniper Gaining on Cisco?".

Regards,
pingu
go_csco
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go_csco,
User Rank: Light Beer
12/4/2012 | 8:51:05 PM
re: Report: Juniper Still Gaining On Cisco
G«£G«™The Dell'Oro numbers are for the core router market. Does the 7x00/6500s belong in the core? You don't find that many ISP cores built on 7x00 these daysG«™.G«•

True, the 7x00 is used primarily as an edge aggregation device. I believe Cisco is looking for a more G«£apples to applesG«• comparison. The real question is does Juniper treat the M20 as a core or edge router?

Also how much does JuniperG«÷s services revenue factor into the equation? Did Juniper count any revenue from the M10 and M5 platforms? Juniper does maintain they realized no revenue from the M10 and M5 platforms.

Juniper makes very capable products so I would expect them to gain some market share from Cisco. The question is how much have they really gained. If you use three different market research firms, you will more than likely get three different answersG«™.

G«£G«™Also - be careful what you ask for - if Dell'Oro shifts revenue from 7x00 and Services to satisfy Cisco supporters requests, this revenue will impact the stats for other market segments in which Cisco participatesG«™G«•

Care to elaborate?G«™..Just curious thatG«÷s allG«™.

G«£G«™As for the figures that really matter, Wall Street already have them - directly from John Chambers - and they ain't prettyG«™G«•

John Chambers maintained that Cisco is not immune from slow downs in Service Provider spending but is better positioned than itG«÷s larger competitors because of CiscoG«÷s product diversity. Considering Cisco came in 250 million shy of meeting analyst estimates, and Nortel warns they would miss by close to 2 billion, IG«÷d say Chambers was right on target.

Also looking at the other respectable large cap players in the tech sector falling short gives clear indication that no one is immune from this economic down turn. Smaller nitch players that have executed well seem to have escaped the mighty revenue axe up to this pointG«™Juniper is one company that has been able to do some impressive bobbing and weavingG«™..

go_csco!!
captain kennedy
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captain kennedy,
User Rank: Light Beer
12/4/2012 | 8:51:11 PM
re: Report: Juniper Still Gaining On Cisco
Is it true that CSCO is pressured to move into the transport arena? If yes, when will this pressure apply to JNPR?
russ4br
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russ4br,
User Rank: Light Beer
12/4/2012 | 8:51:11 PM
re: Report: Juniper Still Gaining On Cisco
"I would be very interested in seeing the true figures. GSR, 75XX, 7XXX, Services against M160, M40, M20, M10, M5 Services."

The Dell'Oro numbers are for the core router market. Does the 7x00/6500s belong in the core? You don't find that many ISP cores built on 7x00 these days.

Also - be careful what you ask for - if Dell'Oro shifts revenue from 7x00 and Services to satisfy Cisco supporters requests, this revenue will impact the stats for other market segments in which Cisco participates.

As for the figures that really matter, Wall Street already have them - directly from John Chambers - and they ain't pretty.

-russ
chuckjackson
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chuckjackson,
User Rank: Light Beer
12/4/2012 | 8:51:15 PM
re: Report: Juniper Still Gaining On Cisco
Now that the GSR has an oc-192 interface, it will be interesting to see what happens to the market share numbers in the future. In the past, jnpr clearly had a distinct advantange. The one version of the GSR actually supports almost twice the number of oc-192 interfaces than jnpr's m160.
biatcher
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biatcher,
User Rank: Light Beer
12/4/2012 | 8:51:22 PM
re: Report: Juniper Still Gaining On Cisco
Just where did they get their data? I will assume that they probably went to the vendors and asked them what their shipments were and assumed that they were being told the truth. Lord forbid that they would ever go out and ask Cisco and Juniper for a list of customers so that they could verify anything.

Maybe we should come up with the new 3 biggest lies in the Optical business:

1. It must be true if the vendor said so....

2. According to Mr. "Will sell my name for a quote" Analyst of Full of SH_T Market Hype (Research) Firm, The market for Optical Toilet plungers will reach $25 billion in two years"......

3. Lightreading is unbiased



router1
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router1,
User Rank: Light Beer
12/4/2012 | 8:51:36 PM
re: Report: Juniper Still Gaining On Cisco
These numbers do seem horribly skewed toward Juniper. I have to got to admit, that in the time I've been reading Lightreading I have yet to read many positive Cisco articles here. As for pro Cisco people reading these articles, wasn't it Sun Tsu who said "Know your enemy as you know yourself".
noitall
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noitall,
User Rank: Light Beer
12/4/2012 | 8:51:36 PM
re: Report: Juniper Still Gaining On Cisco
you must...isn't "idiots" a little harsh?

the real issue here: that csco's routers have critical mass for only one reason: first to market and the only player for ten years, amazingly. but the platform stinks and it's dying. meanwhile the company has no answer...it is losing share, steadily, to jnpr in multiple customer environments where csco dominated for a long time.

the dog simply won't hunt going forward. bashing lightreading won't stop this.
red1969a
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red1969a,
User Rank: Light Beer
12/4/2012 | 8:51:40 PM
re: Report: Juniper Still Gaining On Cisco
I would be very interested in seeing the true figures. GSR, 75XX, 7XXX, Services against M160, M40, M20, M10, M5 Services.
I believe this would make really interesting reading.
C'mon Cisco, publish those figures!!!
Glad to see that the public doesnt believe everything it reads ;-)
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