On January 30, 2025, the US Division of Justice (DOJ) moved to dam the acquisition of Juniper by HPE. The DOJ is worried about 60% of the wi-fi LAN (WLAN) market being occupied by two distributors (HPE and Cisco) and that it could stifle any innovation from different distributors which have single-digit market share. HPE and Juniper have began to contest this ruling with numerous counterpoints concerning WLAN competitors, a traditional “higher collectively to gasoline innovation” story, and a cautionary story concerning community safety, particularly for the following era of rising know-how.
The DOJ will not be unsuitable that sleepy, mature markets like IT networking battle with innovation with out the push from startups. Immediately, innovation in networking is tough to return by. It’s been some time (early 2000s) for the reason that main networking gamers drove innovation available in the market, such because the creation of latest protocols and architectures to assist networking organizations overcome know-how challenges. For the reason that 2010s, there was a chasm. Any innovation on this area has primarily come from two areas: 1) startups like Meraki, Mist, Nicira, and Viptela; and a couple of) massive clients like Fb and Google. The massive cloud suppliers have been lighthouses for networking professionals in want of steerage on information heart greatest practices, how you can automate networks, and various community architectures.
The enterprise Wi-Fi market hasn’t moved the needle a lot, both. Regardless of being round for 25 years, Wi-Fi options hardly do greater than join laptops and cell phones in workplace settings and have actual issue adapting to the brand new ways in which customers wish to leverage different wi-fi protocols. Few makes an attempt have been made to enhance the administration expertise of supporting the varied machine varieties, together with IoT units. Few options assist fundamental connections into Bluetooth, EnOcean, NearLink, Thread, and Zigbee applied sciences. To HPE Aruba’s credit score, it has one of many strongest IoT-ready wi-fi options obtainable, providing a robust sensible workplace and retail portfolio that includes AI safety insights, edge computing options, and IoT information processing capabilities. Nevertheless, a lot of this functionality got here from the innovation underneath previous Aruba management/visionaries, Dominic Orr and Keerti Melkote.
And that’s simply WLAN. This lack of innovation is systemic throughout the whole IT networking world. The largest hole is on the edge (manufacturing crops, stadiums, shops, aircrafts, and so forth.), the place nontraditional units want connectivity. With over 100 billion IoT units, the market is huge, pushed by new functions, units, safety wants, and {hardware} necessities. Networking on the edge faces important challenges, corresponding to wi-fi interference and troubleshooting in distribution facilities. The trade wants business-optimized networks (BON) with verticalized options.
The place does that depart us?
The IT networking world wants a hero: somebody with the sources and the desire to revolutionize the trade. Realistically, that isn’t going to return from a tiny startup. However the massive gamers have been centered on market share, advertising and marketing, and margins. Change would require true management.
Will the DOJ’s motion to dam the Juniper acquisition save innovation in networking? No. Would the acquisition unlock new innovation? Unlikely. However we’d like to be unsuitable (see under). Why is it onerous to think about this rosy future? Each main public know-how firm struggles to fund revolutionary innovation when there are shareholders to fulfill. Realistically, efficiencies gained from a mixed portfolio/group largely go to shareholders, to not fund new natural innovation. And it’s far simpler to justify innovation through one-time acquisition prices fairly than an ongoing stream of unrealized innovation.
Finally, both future may maintain excellent news for purchasers if they’re put entrance and heart. Let’s look forward on the attainable outcomes and what every path may entail:
State of affairs 1: HPE and Juniper stay separate
HPE’s broader portfolio paired with its Aruba footprint has an actual alternative to be an edge networking innovator that creates verticalized easy-to-use options. In a time when virtually each vendor is claiming to have cloud-native, AI-driven platform options, HPE is the one networking vendor that has the sources and portfolio in the present day — corresponding to compute, multilayer stack, storage, and software program — to place collectively an edge, IoT, and networking answer to ship a BON answer for retail and different adjoining verticals, corresponding to hospitality. Nobody else is making massive bets, turning their backs on generic know-how suppliers, and selecting a number of verticals to go after. This may very well be HPE’s second to reclaim its innovator tradition of yesteryear to really personal edge and community verticalization.
Juniper’s know-how and govt group are forward of the sport with its an AI-driven networking platform, Mist, that unifies the administration and monitoring throughout numerous networking and safety elements. Mist innovation is how Juniper grew its WLAN market share so shortly over a brief time frame and posed a problem for the competitors, together with HPE. With extra investments, Juniper can proceed to disrupt the administration of knowledge heart and campus networking market with its Mist management — underneath Bob Friday and Sujai Hajela — and Marvis AI answer. As such, Juniper would create a businesswide networking material answer, which is crucial for the way forward for networking. Trying ahead, the corporate can increase on its networking platform by seamlessly integrating safety providers, with Marvis as its basis to automate the safe networking platform. At this stage, Juniper would simply be working up towards Excessive’s networking platform, its model of a safe businesswide networking material. Cisco, Huawei, and others could be hard-pressed to match Excessive’s and Juniper’s platforms.
State of affairs 2: HPE acquires Juniper
A mixed group can take the superpowers from each teams to create a dominant drive in IT networking; however in follow, it’s too tempting to concentrate on quick money for shareholders with the higher management from the acquired social gathering selecting to shortly transfer on as quickly as their contract phrases permit.
To place a mixed HPE/Juniper for fulfillment, Juniper management ought to take the helm of progressive progress throughout its portfolio to make sure merchandise like Mist don’t get stifled because the engineers combine into the Aruba portfolio (Axis, ClearPass, Cape Networks, Silver Peak, and so forth.). There’ll probably be some portfolio rationalization. Clients with Aruba switches and {hardware} ought to get a five-year transition plan to JunOS. In the meantime, HPE networking engineers ought to spearhead the trade innovation and solutioning to deliver collectively the edge-to-cloud story within the chosen industries. This may require working facet by facet with the HPE GreenLake group to increase on sensible workplace options and retain retailer capabilities. Hospitality could be the following massive trade to sort out by combining the sensible workplace and retail retailer options.
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