Summary
Interesting strategy that Juniper has and they will have some success in the networking market as well as other lower cost alternatives to Cisco. Today, other alternatives to Cisco are having some success as corporate budgets continue to be constrained, yet enterprises still need to invest in their networking infrastructure so they are looking to do 'more with less'. Some key networking players have been struggling such as Nortel and 3Com.
Analysis
Product and Market Implications.
1. Alternative to Cisco - a number of enterprise accounts still needto procure networking infrastructure but given the economic conditions in the market will look to alternatives to the high price of Cisco equipment - i.e. more for less, not willing to pay Cisco premium - Cisco makes 65% margins on their networking products.
2. Nortel is struggling
3. 3Com is struggling
4. Enterprise accounts are already looking at or implementing networking product alternatives at the department level and at the 'edge' of their networks. Cisco is already vulnerable here. The networking 'core' is next.
5. Cisco will get distracted going after HP in the server market
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
