“If a government lawsuit is successful, the real beneficiary is not the customer, not the customer who loses the profits of the total company, but the Cisco continues to have the scale necessary to maintain control share,” says HPE and Juniper. Masu. In the 21-page response to the DOJ lawsuit.
Hewlett Packard Enterprise and Juniper Networks claim that if the US Department of Justice succeeds in blocking HPE’s $14 billion Juniper acquisition, the “true beneficiary” will become Cisco, the networking market leader.
In a 21-page response to DOJ’s lawsuit to prevent the acquisition of Juniper, HPE said it would have “counter effect” to further protect Cisco as the dominant incumbent if the government succeeds in blocking the transaction. I insisted.
In fact, HPE and Juniper argue that DOJ’s complaints will strengthen the “status” by benefiting Cisco, which has dominated wireless networking for decades.
(Related: DOJ appeals to block Juniper network HPE’s $14 billion acquisition: 5 things to know)
“Contrary to the government’s claims, this deal actually has been a more formidable player with the width and size needed to get to the toe more effectively against Cisco for customers who want a one-stop shop. “We will increase competition by creating a new product,” HPE said. in a response filed in the US District Court for the Northern District of California. “If a government lawsuit is successful, the true beneficiary will lose the profits of the total company, not the client, but Cisco will continue to have the size necessary to maintain its dominant share.”
HPE has issued a ruling in favour of HPE and Juniper against DOJ and is asking the court to “dismiss” the case. Additionally, HPE is seeking the court to refund HPE for “costs incurred in the defense” of the lawsuit.
Both Cisco and the Department of Justice declined to comment.
HPE argued that the merger with Juniper Network is “crucial to promote competition in the networking market” and is engaged in market share “to manufacture a reason to block this transaction” DOJ claimed to be engaged in fees.
“It combines Cisco’s market shares along with the defendant’s stocks, claiming that the three market shares are “over 70%.” However, the complaints are markedly silent about each of the defendants’ market shares,” HPE said. “There’s a good reason for this. Cisco alone accounts for more than half of the suspected WLAN market, with Cisco’s WLAN market share in the US consistently exceeding 50% over the past decade. , the total share of the suspected market is less than 25%, far below the level the court has banned trading under Section 7 of the Clayton Act. HPE share is 14-17% The range is Juniper’s share ranges from 5-7% over the past three years.”
IDC, a global market research intelligence company headquartered in Needham, Massachusetts, said its HPE and Juniper Network combined compared to 41% of CISCO systems and 41% of CISCO systems for the first nine months of 2024. He said it accounts for only 20.4% of the wireless LAN market’s global revenue. 7.9% of Chinese networking company Huawei.
HPE also claimed that DOJ relies on a “handful of contextual statements of Cherry Picks” suggesting a competition between HPE and the Juniper Network.
In fact, HPE said the two companies were “extremely intense” in the wireless LAN market, not just Cisco but also at least seven “trusted competitors” in the US, including Extreme, Fortinet, Ruckus, Ubiquitchi, Nile River and Meter. “We are facing competition.”
“Most of these companies have already established a networking footprint with enterprise customers through other products they sell to their customers,” HPE said. “Most are properly capitalized, and the market capitalization of some of these competitors combines the competitors of both HPE and Juniper. They all compete aggressively. Almost all of the competitors have secured large US customers victory in key areas such as retail, hospitals and higher education. This is because complaints rely heavily on wireless infrastructure. They claim that they are particularly harmful to this transaction because they have complex needs.”
HPE’s response to DOJ is the four people who have condemned the DOJ lawsuit, including Lon Westfall, who argued that the transaction should be argued given the “very competitive, diverse and diverse” wireless LAN market. Citations from market analysts. ESG’s Jim Frey, who opposed the lawsuit, argued that “DOJ has not benefited in itself.” “The complaints are based on EMA’s Shamus McGillicuddy, who alleged that “complaints ignore all other aspects” of the transaction, including data center switching, routing, firewalls, SD-WAN and network automation. And Hyperframe’s Stephen Dickens, who argued DOJ’s concerns, is unfounded.
Additionally, the DOJ complaint refers to a CRN story that references a quote from Patrick Shelley, CTO of PKA Technologies, a Montberle, New Jersey-based solution provider. “DOJ missed the boat here,” Shelley said in the story. “If HPE can acquire Juniper networks, it will drive more innovation and force Cisco to stay up to date with AI-enabled networking.”
In response to HPE’s response to DOJ’s complaints, Shelley reaffirmed his view that if DOJ succeeds in blocking transactions, it would undermine competition in the networking market and reduce innovation.
“If DOJ is successful, it’s bad for partners, customers, HPE and Juniper,” he said. “The only beneficiary of this lawsuit is Cisco, which is very dominant in the networking market. HPE is working with Juniper to build a future AI network with Juniper and will do so by DOJ. You can stop it.”
Shelley said it was confusing that all regulators around the world in 14 other jurisdictions have approved the deal rather than the United States. “That doesn’t make any sense at all,” he said.
The irony of the DOJ case is that some of the biggest supporters of HPE’s Juniper Network acquisition are Cisco customers looking for a strong networking alternative.
“90% of our customer base uses Cisco Networking, and over half were asking about the benefits of combining the HPE-Juniper networking portfolio,” he said. “Customers were very excited to see what they could do by combining HPE-Juniper to compete with Cisco. Now they reconsider their options in the DOJ lawsuit to block this deal. I’m forced to do that.”
Cr Howdyshell, CEO of Fulcrum IT Partners Company and top HPE and Aruba partner Advizex, also reaffirmed his view that the DOJ suit is missing out on the mark given Cisco’s market advantage.
In fact, Howdyshell, who is vocal in favour of the HPE Juniper deal, said it has received praise from many for shining a spotlight on the benefits of HPE-Juniper trading for its customers.
In fact, Howdyshell said he was with a customer worried about Cisco’s alternatives who were disappointed with DOJ’s lawsuit over the deal. “Customers have invested heavily in Cisco and are heading down the road to consider HPE-Juniper, and now they have to pause it,” he said. “Customers say they want a strong Cisco alternative.”
Howdyshell said the lawsuit could potentially eliminate that the client was a great opportunity to make a competitive bake-off, seeing the pros and cons of both platforms between HPE-Juniper and Cisco. He said there is. “DOJ effectively eliminates alternatives that are competitive for our customers,” Howdyshell said. “At this point, customers will need to see three OEMs instead of two. This can be more complicated and expensive than looking at Cisco vs HPE-Juniper.”
