Juniper Buys In to Application-Performance Market

 
 
By Paula Musich  |  Posted 2005-04-26 Email Print this article Print
 
 
 
 
 
 
 

The networking vendor plans to acquire WAN-optimization provider Peribit Networks and application front-end vendor Redline Networks for a total of $469 million.

The nascent but fast-growing application-performance optimization market got a vote of confidence from a major networking vendor on Monday when Juniper Networks announced its intent to acquire Peribit Networks and Redline Networks in two deals with a combined value of $469 million. The Sunnyvale, Calif.-based company agreed to acquire WAN-performance optimization provider Peribit Networks Inc. for $337 million, and it agreed to acquire application front-end vendor Redline Networks Inc. for $132 million. Both deals are based on a combination of stock, cash and assumed stock options. The acquisitions fill in missing pieces of Juniper Networks Inc.s Infranet initiative, which calls for overlaying technologies on the existing Internet infrastructure for carrying business applications in a way that can provide the benefits of a private network without the expense, said Lynn Nye, principal at APM Advisors in Portland, Ore.
"They first focused on putting a [Multiprotocol Label Switching] intercarrier standard in place. That takes care of the traffic between carriers. But it doesnt address latency, and it still needs to be secure. So this fits into that model very well," Nye said.
"We have a vision of how to guarantee and assure the performance on an application right through the network to the user. It started with the security people [NetScreen] last year," said Kim Perdikou, associate general manager of Junipers Emerging Technologies Group in Sunnyvale, Calif. The Peribit WAN optimization offerings provide compression capabilities that can improve performance across slower wide-area links for business applications. The Redline application front-end offerings boost performance and scalability for web-enabled data centers and other sites. By integrating the Redline and Peribit offerings, Juniper can address a problem for compression technology used at the edge of a network that uses encryption in the data center, Nye said.
"Encrypted SSL [Secure Sockets Layer] traffic cant be compressed. But if you combine Redline and Peribit, with Redline in the data center and Peribit in the branch office, then you have both ends pretty well taken care of. If they have the SSL keys, then they can do compression before [traffic] goes out on the network," he said. Click here to read more about Junipers acquisition of security appliance-maker NetScreen Technologies Inc. The acquisitions throw down the gauntlet to rival Cisco Systems Inc., which has been slow to recognize the developing application front-end market. "Cisco has not responded yet to moving from simple server load balancing up to these AFEs. There have been several accounts where customers have been wanting to see Cisco do something and its not been there. Redline, NetScaler, F5 Networks have been picking up that business. And on the branch side, Cisco is still relying on their built-in IOS [Internetwork Operating System] features like their Quality of Service mechanisms," Nye said. Although Juniper has a small equity stake in Peribit rival NetScaler Inc., Perdikou downplayed the potential conflict. "We made that investment last year because we knew this space was interesting. I dont think theres a huge conflict there," she said. The application acceleration market, made up of both application delivery controllers and WAN optimization controllers, last year was "just shy of $1 billion," according to Joe Skorupa, industry analyst with Gartner Inc. in Fremont, Calif. Skorupas preliminary estimate for the total market is $1.5 billion. "We expect to see significant growth over the next several years. This is a market where its clearly in the middle of significant problems that customers are facing," he said. To read more about Junipers use of third-party security in SSL VPNs, click here. Peribit CEO Jef Graham will become general manager of a new Applications Products Group that is being formed to incorporate the two new acquisitions into Juniper. Redline CEO Roy Johnson will report to Graham when that acquisition closes. The Redline acquisition is expected to close in the second quarter, while the Peribit acquisition is expected to close in the third quarter. Revenue from both acquisitions was about $40 million last year. Peribits product line includes the Sequence Reducer and Sequence Mirror compression platforms as well the Sequence Reduction System software and Periscope Central Management System software. Redline brings to the table its data center-based E|X application front end network appliances and T|X Web I/O processors, used by Web sites to allow users to control and customize HTTP environments. Check out eWEEK.coms for the latest news, views and analysis on servers, switches and networking protocols for the enterprise and small businesses.
 
 
 
 
 
 
 
 
 
 
 

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