The core router race

While describing Juniper Networks’ new core router this week, Shailesh Shukla, the vendor’s vice president of service provider marketing and partnerships, said two things to me that I can’t reconcile.

He said the core router market is “a very hot market right now.” He also said, “It’s a two-horse race.” (Actually, at first, he accidentally called it a “two-legged race,” before realizing he really meant a “two-horse race,” and in the confusion, it sounded like he was talking about a two-legged-horse race. I only mention that so that now the image of the two-legged-horse race will haunt your nightmares, as it did mine.)

Generally speaking, there <I>are</I> only two horses in the IP core router race: Cisco Systems, which has about 61% of the market, according to Ovum-RHK, and Juniper, which has about 35%. (You could call it a three-horse race, I guess, if you consider Cisco to be the first two horses.) So how “hot” can a market be if there are only two participants?

True, Cisco generated a lot of buzz with its recent claim of a roughly $1 billion annual revenue run rate for its CRS-1 core router. And Juniper’s new product is sure to get plenty of attention. If the market is so hot, then, is there room for a viable third player now that Avici Systems, which has been holding that post for the last few years, is throwing in the towel?

In 2003, the Yankee Group predicted that, of the eight or so core router vendors extant at the time, only four would survive. That might have been slightly optimistic. At the time, Cisco and Juniper collectively held more than 95% of the market. But that didn’t stop Procket Networks, Chiaro Networks, Caspian Networks and Avici from having a go at it. (Alcatel was shrinking away from the space at the time.) None of those companies compete in the IP core duopoly we have today. But Procket wound up in the winner’s circle, having been acquired by Cisco for $89 million.

So tell me what you think: Is there room for a new horse in this race? And if so, what problem would it solve that Cisco and Juniper don’t already?

E-mail me at ed.gubbins@penton.com.