Juniper and NSN Form Joint Venture to Focus on Carrier Ethernet Solutions

| Jun 8, 2009 | Carrier Infrastructure | Competitive Intelligence Report

| Analyst: Glen Hunt

Current Perspective: Positive
Vendor Importance: Moderate
Market Impact: Moderate

Event Summary

June 4, 2009 – Juniper and Nokia Siemens Networks announced that they plan to form a joint venture to address the carrier Ethernet Transport market. The Netherlands-based joint venture will be dedicated to managing and executing the carrier Ethernet portfolio roadmap, and extends the previously announced partnership designed to deliver to service provider customers a fully interoperable carrier Ethernet solution for mobile backhaul, business services and residential broadband networks.

Analytical Summary

• Current Perspective: Positive on Juniper and NSN’s announced joint venture, which further expands the strategic partnership they announced in February 2009 to deliver carrier Ethernet solutions. With the planned joint venture model, both companies will contribute the necessary products and support to meet the end-to-end portfolio needs of their 200 joint service provider customers. The solution consists of Juniper’s MX-series Ethernet Services Routers, NSN’s A-series carrier Ethernet Switches as well as the ASPEN network management system. The announced solutions have received endorsement from XO Communications.

• Vendor Importance: Moderate to high for both companies, since the formation of the joint venture represents a significant long term commitment in terms of resources, products and corporate positioning. Since the earlier strategic partnership agreement, announced in February 2009, both companies must feel that this next step is justified based on the potential business opportunity that exists to delivery carrier Ethernet solutions. Neither company has provided additional details regarding the joint venture in order to provide a further perspective with respect to ownership, staffing, level of investment or other aspects.

• Market Impact: Moderate on the carrier Ethernet and mobile backhaul market segments, since the joint venture not only signals to the industry that Juniper and NSN are taking the next step in their relationship, but it establishes a framework for a compelling solution offer that addresses key service provider requirements, which combines the strengths of NSN’s global services capabilities plus its A-series assets along with Juniper’s high scale MX-series carrier Ethernet portfolio. At this juncture, the joint venture provides service providers a greater comfort factor that the integrated carrier Ethernet solutions will receive the longer term funding and technology development necessary.

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Current Perpsective

Competitive Positives and Concerns

Recommended Vendor Actions

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Recommended Competitor Actions

• Alcatel-Lucent should continue messaging around its recently launched Carrier Ethernet framework to identify the capabilities offered at each layer of the network. The recent framework announcement identified three layers: transport, services and application enablement. The company should provide white papers and proof points that show the value to the service provider and the scope of new services that can be launched by using the framework, its IP product portfolio, and end-to-end management solutions based on its 5620 SAM.

• Cisco should reiterate its IP NGN carrier Ethernet design, which supports any-play services, standard Layer 2 Metro MEF compliant business services, plus Layer 3 IP MPLS/Multicast VPNs for business customers. Cisco should also highlight its MToP offer which includes the MWR 2941-DC Mobile Wireless Router platform and the 7600, which is designed to optimize, aggregate, and transport mixed-generation radio access network traffic. Cisco should definitely highlight that it is the first vendor to complete the IP/MPLS Forum’s “MPLS in Mobile Backhaul Certification” program successfully.

• Ericsson should outline its end-to-end managed solutions for carrier Ethernet and mobile backhaul network. Ericsson should show how it is helping fixed and wireless operators deliver cost effective infrastructures that support the convergence of fixed and mobile networks based on products such as its SmartEdge/SM 480 family of switches and routers, MINI-LINK packet microwave, OMS series optical and network management system. Ericsson should also highlight its market-leading global professional services capabilities.

• Vendors such as Ciena, ECI and Tellabs should contrast their respective solutions for cost effective carrier Ethernet infrastructures that support transport oriented Ethernet. Ciena should highlight its carrier Ethernet Service Delivery portfolio with support for PBB-TE. Tellabs should point to its recently revised corporate focus and new line-up of metro Ethernet products. ECI should show the progress being made leveraging its 1Net framework and 9000 series Ethernet switches.

• Huawei and ZTE should outline their respective strategies to support carrier Ethernet services, their respective end-to-end solutions and growing professional services capabilities. Huawei, for example, should highlight its CX-series metro Ethernet portfolio and IPTime framework for mobile backhaul. ZTE should provide highlight its “All-Service Packet Transfer Bearer Network Solutions” to meet a broad range of Ethernet service demands based on its ZXR10 9000 and ZXC TN 6000 series product line.

• Brocade, Extreme and other carrier class Ethernet switch vendors should highlight their extensive experience with high performance Ethernet solutions and products such as their MLX series and BlackDiamond 12808/20808 series switches respectively. They should also show how portfolios, along with their strategic partners, can be leveraged to provide an end-to-end managed solution for wireline and wireless operators.

Recommended End User / Customer Actions

• Mobile operators evaluate the new joint venture as a major provider of integrated solutions based on the strength of its mobile and broad range of access offerings as well as solutions scalable metro Ethernet aggregation solutions.

• Service providers seeking to leverage a common Ethernet access and aggregation infrastructure to deliver residential and business services should consider the newly announced carrier Ethernet solution offered being developed through the new joint venture. The solution, targeted for availability in Q4 2009, to address the complexities of deploying a carrier grade Ethernet transport network.

• Mobile operators using Juniper’s mobile backhaul solutions should consider the added functionality that can be obtained by augmenting with NSN’s A-series access product portfolio plus the use of ASPEN. Existing Juniper customers should evaluate the impact the joint venture will have on their existing relationship outside of the new business model.

• Service providers currently using NSN’s Ethernet solutions should consider the higher scalability that Juniper’s MX-series Ethernet Service Router can deliver – ranging from the MX240 to the MX960 which delivers Terabit level performance to meet rapidly expanding capacity and bandwidth requirements as they collapse multiple networks onto a multiservice metro Ethernet infrastructure.

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Current Perspective

Competitive Positives and Concerns

Recommended Vendor Actions

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