IBM, Juniper Become BFFs
The OEM deal, announced early today, gives IBM two alternatives to Cisco Systems Inc. (Nasdaq: CSCO), its longtime partner. In addition to Juniper's gear, IBM is reselling equipment from the former Foundry Networks, now owned by Brocade Communications Systems Inc. (Nasdaq: BRCD). (See Juniper, IBM Sign OEM Agreement, IBM, Juniper Get Closer, and Brocade to Acquire Foundry.) Most observers have interpreted all this activity as a sign that IBM is really ticked off about Cisco expanding its ambitions beyond networking and into IBM turf. For example, Cisco's gotten into blade servers, which are part of its Unified Computing System (UCS), an all-in-one data center platform announced in March. (See Cisco Dreams of Data Center Unity.)
IBM and Juniper have been collaborating (Cisco's favorite word!) on cloud technology, and have been pushing to publicize that work in recent months. IBM is also helping with Juniper's upcoming data center fabric, called Stratus -- although, given that Juniper has said almost nothing about Stratus besides the name, it's tough to say what IBM's contribution has been. (See IBM, Juniper Get Closer and Juniper Strikes at the Data Center.)
On Juniper's side, a close relationship with IBM makes sense as data centers and cloud computing become more important to the Ethernet business. Juniper doesn't sell servers or storage networks, so IBM can fill those gaps and create a potential answer to Cisco, should UCS catch on with customers.
Analyst Catharine Trebnick of Avian Securities LLC predicted the IBM/Juniper OEM deal back in May. (See Everyone Loves IBM.) She also put out a research note yesterday saying Juniper has made good strides in the Ethernet market -- but that it's "giving away both products and installation" as a way of securing new customers. A Juniper spokesman wasn't immediately available to comment.
— Craig Matsumoto, West Coast Editor, Light Reading