Dimensional Data

Hewlett Packard Enterprise is looking to become a more significant player in the networking space through its planned $14 billion acquisition of Juniper, a deal that it hopes will make it a more formidable rival to longtime market leader Cisco Systems. The deal, announced Tuesday after the markets closed, is a big deal in the early days of the new year for a networking industry that has become central in an IT sector that is becoming more distributed and more cloud-native. During a virtual briefing with analysts and journalists this morning, HPE CEO Antonio Neri described an HPE centered around its networking business that has AI capabilities and its GreenLake edge-to-cloud platform of IT services at its foundation. “HPE will be a new company where networking will be the core foundation of everything we do,” Neri said. “We’re going to accelerate what we call an AI-driven agenda, and that will allow us to capture this massive inflection point.” Even when the deal closes – which is expected to happen later this year or in early 2025 – HPE will still likely be in third place in the global networking space behind Cisco and Huawei, but will have a stronger portfolio that will not only include greater AI capabilities but also a stronger presence in both the enterprise and telecom spaces. Once it closes, Juniper CEO Rami Rahim will lead the combined HPE networking business and report to Neri. Juniper’s Mist AI is at the Center Unsurprisingly, AI was a key component of the deal. In a research note, Will Townsend and Patrick Moorhead, analysts with Moor Insights and Strategy, wrote that their thinking after initial news reports about a possible deal circulated was that HPE likely was looking for a “strong AI anchor” for its portfolio of hardware, software, and GreenLake IT consumption services. “AI is hot, ignited by the attention being directed toward generative AI, the underlying large language models, and many promising use cases,” Townsend and Moorhead wrote. “One could argue that beyond the AIOps capability found in the HPE Aruba Networking portfolio today, HPE needs further AI depth to remain competitive and continue to grow its top-line revenue and profitability. Juniper could deliver on that front.” Rahim called AI “the biggest inflection since the dawn of the internet itself” and added that the combination of HPE and Juniper “will be able to bring the depth and the breadth of the portfolios necessary to capture the full market opportunity that AI presents in front of us.” AI in networking is a strength for Juniper, which in 2019 bought Mist Systems and its AI technologies, including the Mavis virtual network assistant, which the analyst wrote serves “as the tip of the spear for Juniper’s reinvigorated efforts within the enterprise for WLAN, LAN, WAN, and SD-WAN solutions.” “By all measures, the Mist acquisition has been a success, with Juniper growing its enterprise install base at a faster rate than its service provider business over the last 12 to 18 months,” Townsend and Moorhead wrote. AI and Networking AI will play an increasingly important role in networking going forward, from dynamically adjusting bandwidth and self-correcting in the network for maximum uptime to quickly finding root causes for problems and deploying virtual network assistants. In a blog post last month, Liz Centoni, […]