HPE opposed the US Department of Justice’s objection to the acquisition of Juniper Networks. This includes arguments that blocking transactions would benefit Huawei and therefore have national security implications.
This week’s Enterprise Tech giant submitted Riposte (PDF) to DOJ’s claim that HPE/Juniper totals reduce competition and lead to higher prices.
In HPE’s view, the DOJ made the mistake considering that its acquisition was primarily about regulatory concerns regarding wireless LANs and market concentration in the sector.
Filing points out that Juniper is a Wi-Fi player, but a minor player.
“If that’s the main goal, there’s an easier and much cheaper alternative for HPE to gain a single number market share in the US,” Filing said.
“In fact, the main goal of this transaction is to combine Juniper’s data center routing and switching business with HPE’s storage and computing services, driving increased competition and innovation across the networking segment.”
If combined HPE/Juniper can do that, “this deal will strengthen the competition by creating a reliable alternative to Cisco.
HPE hopes the DOJ will consider Huawei as “it has been repeatedly identified by the US government as a national security risk,” and HPE hopes Washington will “use Chinese technology in critical infrastructure around the world.” They claim to have the stated purpose of reducing the number.
The filing also defeated Juniper’s Wi-Fi products, and HPE denies that Juniper has risen to challenge it and Cisco and HPE. The document even points out that Juniper has only gained single-digit market share “in a space with eight other reliable competitors.”
The real battle is through the AI network
Analyst company Andover Intel said, “Does the DOJ block of HPE/Juniper merger really help Cisco?”
Principal analyst Tom Nolle’s answer is “Yes.” He reasones that the addressable total market for networking equipment is not growing rapidly, and buyers rarely throw away current suppliers.
However, Buyers are open to new suppliers when building ONPREM AI infrastructure.
“Cisco’s Reorg around AI is clearly intended to control one development that can create new small enclaves of network deployments. In-house AI means a cluster of GPU servers, and perhaps its own It requires a data center network.”
“Juniper’s AIOPS positioning has been effective against Cisco in areas where all sorts of major network upgrades have been proposed, and has even won several deals that have driven Cisco Gear away,” the analyst said. I’m thinking about it.
As HPE sells AI servers, once you get Juniper, it will also be a strong position to provide a network.
“For decades, my involvement with businesses has shown that data center networking promotes enterprise networking and data center technology promotes data center networking. Cisco has a server (UCS) But there is no important position in the enterprise data center market. HPE does.
Nolle also believes HPE’s “strategic impact among corporate buyers is better than Cisco’s.”
“So from all this, it seems like it’s helpful for Cisco to block the merger,” he wrote.
“If that’s the case, given Cisco is incumbent, if DOJ succeeds, it could also undermine competition.”
However, even if the transaction is blocked, Nol doesn’t think Cisco will do the cart wheel.
“In the long run, Cisco’s only solution is to add the size of the network pie and get the largest share of the additional. Yes, HPE/Juniper might be in a good place to do that. But you can do that on HPE alone, IBM alone, perhaps Dell, Oracle and Broadcom alone. Networking is an application that provides things and creates what builds business cases.”®
