Mergers & acquisitions

Juniper Buys Aurrion for Silicon Photonics

Juniper Networks today announced its purchase of Aurrion Networks, a silicon photonics company whose technology is expected to significantly lower the cost of optical networking.

Juniper Networks Inc. (NYSE: JNPR) is not releasing financial details of the transaction.

Aurrion , founded in 2008 in Santa Barbara by John Bowers, one of the Calient founders, was aiming at the creation of a scalable silicon photonics platform. Its core technology is the integration of Indium Phosphide semiconductors into a silicon photonics platform, which the company says allows all photonic elements to be produced in a cost-effective silicon manufacturing process. (See Top Ten: Optical Networking Movers & Shakers and Aurrion Presents Silicon Photonics.)

"Aurrion has invented breakthrough technology that combines the economies of scale pioneered by the silicon industry with the unique properties of light to carry information over long distances at significantly lower cost," said Juniper Founder and CTO Pradeep Sindhu, in the blog post announcing the acquisition. "The end result? Dramatically lower cost per bit-per-second for networking systems, higher capacities for networking interfaces, and greater flexibility in how bandwidth carried on light is processed inside the electronic portions of networking systems."

That is critical, Sindhu explained, because to this point, optoelectronics have not followed the downward cost curve of the electronics portion of networking systems and currently constitute more than half of the overall system costs. With the boom in video networking, inter-data center traffic and other traffic demands, something had to happen on the optoelectronics side, he said.

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"We expect that Aurrion's breakthrough technology will result in fundamental and permanent improvements in cost per bit-per-second, power per bit-per-second, bandwidth density, and flexibility of networking systems," Sindhu said. He promised speedy integration of the new technology into Juniper's networking systems, though no time frame was cited.

Interestingly, Aurrion's CTO Greg Fish shared an OFC stage with Yuval Bachar, network hardware engineer at Facebook, about 18 months ago in which Bachar called for the merging of optical components with manufacturing to bring technology breakthroughs to market faster. This may be right up that alley. (See Facebook Wants to See Optical Sector M&A.)

— Carol Wilson, Editor-at-Large, Light Reading

Mitch Wagner 8/2/2016 | 8:40:49 PM
Re: Against the tide Exactly so. There will always be a market for high-performance hardware. Question is how big a market. 
mhui0 8/2/2016 | 8:19:05 PM
Not in a white box yet Until Aurrion's technology comes in an ubiquitous white box, Juniper will reap the benefits of higher margins by using this technology.
danielcawrey 8/2/2016 | 6:56:52 PM
Re: Against the tide Agreed, perhaps a contrarian strategy will work for Juniper. Not everyone can fit in the software boat, and hardware still must evolve. I think this is the right direction for Juniper to go in. 
cnwedit 8/2/2016 | 5:07:27 PM
Re: Against the tide The question will be how the hardware evolves - the cost structure that Juniper addresses here is real. 
Mitch Wagner 8/2/2016 | 3:43:36 PM
Against the tide In an era when vendors are focused on software, Juniper is doubling down on hardware. Could work for them. Like they say, software doesn't move photons. 
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