Some news you expect, some you don’t. I’ll be honest — I didn’t expect this and would have bet against the idea if someone told me about it. HPE is acquiring Juniper Networks.
I’ve had a couple days to process it, and during that time, I had an epiphany. Thinking back to early 2023 at Aruba’s Atmosphere conference, it hit me why HPE is making this move, which is a very different approach from Aruba’s past. Aruba’s founders — Keerti Melkote and Pankaj Manglik — and the CEO credited with their rise, Dominic Orr, grew the business by challenging the fat access point (AP) approach in the early 2000s with a unique vision on managing a wireless network.
The new executives at Aruba (HPE) from Silver Peak, HPE, and Axis see acquisitions as the way to grow the networking business. At first glance, buying Juniper might seem like a poor approach given its many overlaps (i.e., both companies have switching and wireless product lines), but there is more to this than you think. Much of Juniper’s products and IP would take HPE too long to create organically, and it would be too messy if the company tried to buy different pieces, like Extreme Networks did with Enterasys, Motorola, Aerohive, Avaya, and Brocade. HPE needs a big fish if it is going to hit its targets quickly.
Here is what HPE is getting out of a Juniper acquisition:
- Artificial intelligence. Juniper’s AI product, called Marvis (part of the Mist acquisition in 2019), is by far the most advanced AI solution in the networking market. That’s not a profound statement; no vendor has anything close to it. The quick history: Juniper’s acquisition of Mist brought the company a cloud-based Wi-Fi solution with a leading AI capability, Marvis. Juniper quickly started integrating its switching and routing portfolio into Marvis. Walmart, Amazon, and others took notice. Fast-forward to today: This gives HPE Aruba a two-year lead against its competitors by bringing Juniper into the fold.
- A serious data center switching solution. HPE has had many starts, yet it has always fizzled when it comes to data center solutions that ranged from 3Com switches to the recent Aruba CX switches. None of them stood up to what Arista, Cisco, and Juniper offered. Now, Aruba has Juniper’s data center switching line and robust OS, Junos.
- Real cloud-based management and monitoring. I think we can all agree that traditional networking vendors don’t excel at building intuitive modern software. Specifically, none of them could create good, simple cloud-based management and monitoring solutions for switches and APs. This is the key reason why Cisco bought Meraki, Juniper bought Mist, and Extreme Networks bought Aerohive. For HPE Aruba, shifting Central into the cloud wasn’t turning out to be easy. Now, HPE Aruba will have Mist.
- A foothold in the service provider market. Other than Cisco, Juniper is the only enterprise networking vendor that has a strong presence in the cloud and telecom market. Juniper brings in about $2 billion in annual revenue from the SP market, which is roughly 40% of the company’s 2023 revenue. HPE has been trying to get a networking foothold into the 5G market so it can bring in more Silver Peak sales, which also capitalizes on the 2023 private 5G Athonet acquisition.
- A strong security story. Through this acquisition, HPE aims to further bolster its growing security portfolio by gaining Juniper’s enterprise firewall and its cloud sandbox, complete with a competent threat intelligence team. It is not clear, however, whether Juniper’s “Connected Security” strategy, where switches participate in a security mesh, will find a forever home in a conglomerate like HPE. HPE introduced a similar feature to its CX lineup, which brings application visibility and policy enforcement at the switch. But this recent enhancement sought to position its CX switches as an enterprise firewall alternative, and it may be too soon in its rollout to determine its merit.