Juniper Grows Closer to Calient

Calient Networks Inc. this morning announced it had raised a total of $225 million in third-round financing and that Juniper Networks Inc. (Nasdaq: JNPR) CEO Scott Kriens would join Calient's board of directors.

Juniper was a previous investor in Calient and also participated in the third round.

It's a massive amount of financing, which bodes well for Calient, considering the current climate of the financial markets. But more importantly, Juniper's increased involvement, particularly the addition of Kriens to Calient's board, indicates that IP routing power Juniper is enthusiastic about Calient's all-optical technology as it moves into the next phase of development: commercial production.

Light Reading previously reported that Calient was working on a third round in excess of $150 million (see Calient Raising $150 Million Plus). The company was added to our list of Top Ten Private companies on Dec. 21 (see Calient Achieves Top 10 Status).

Calient is one of the closely watched competitors in the all-optical switching market. It has drawn intense interest for its dense switching fabric based on MEMS (micro-electro-mechanical systems). The product, called the DiamondWave photonic switch, uses arrays of tiny tilting mirrors and signaling software to switch high-bandwidth optical wavelengths (see Calient Claims Breakthroughs On Optical Switches).

Part of the third round of funding will go towards closing Calient's acquisition of Kionix Inc., a chip fabrication specialist that will produce the MEMS components for the switch.

The latest round of investment in Calient, led by BlueStream Ventures, includes a large number of investors and corporate partners in the optical networking market, in addition to Juniper. Investors included Invesco, American Express, J.& W. Seligman & Co., Amerindo Investment Advisors Inc. , TeleSoft Partners, Marconi Communications PLC (London: MNI), Tellabs Inc. (Nasdaq: TLAB; Frankfurt: BTLA), and ONI Systems Inc. (Nasdaq: ONIS).

Both Calient and Juniper officials downplayed Juniper's involvement, saying it was merely an extension of their previous relationship.

"We as a company are pleased with Juniper's participation as an investor," said Terry Gibson, Calient's CFO. "We look to continue to build our working relationship with Juniper. As far as our plans as a company, we're firmly committed to bringing our product to market and building revenue. We need to stick to our knitting and execute."

"Juniper sees Calient as an exciting company in the optical market, and they have an a strong engineering team," says Carl Showalter, vice president of marketing for Juniper. "We believe there is a natural boundary between the routing layer and the optical layer. It's important to see how that evolves because it will tell us how optical routing evolves. This is a good perch from which to observe this."

When asked if Juniper had a unique relationship with Calient or whether they were considering an acquisition, Showalter stressed that Juniper had other investments and activities in the optical market.

"This isn't any kind of unique or exclusive arrangement," said Showalter. "This will be customer driven."

Showalter mentioned that Juniper had investments in, and/or technology relationships with, companies that include Ciena Corp. (Nasdaq: CIEN), Tellium Inc., Corvis Corp. (Nasdaq: CORV), and others. The company also has a joint marketing agreement with Nortel Networks Corp. (NYSE/Toronto: NT).

-- R. Scott Raynovich, executive editor, Light Reading http://www.lightreading.com
Scott Raynovich 12/4/2012 | 9:02:42 PM
re: Juniper Grows Closer to Calient Anybody have any thoughts on the market potential for this switch?
lanman 12/4/2012 | 9:02:42 PM
re: Juniper Grows Closer to Calient The market potential for this type of switch is directly tied to the ability of the carriers to drive high bandwidth services to all segments of the marketplace. SInce most of the carriers are not equiped to deliver cost effective bandwidth to the end user in the metro, this will limit the deployment of these large optical switches until the demand is there.
pb 12/4/2012 | 9:02:41 PM
re: Juniper Grows Closer to Calient Check out www.mmfn.com if you think fiber isn't coming to the metropolitan areas.
moguefett 12/4/2012 | 9:02:40 PM
re: Juniper Grows Closer to Calient ...Scott, are you farmiliar?...
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