Juniper Networks Inc. (JNPR) recently announced that London Internet Exchange Ltd. (“LINX”) selected its routing and switching solutions for an undisclosed amount. Juniper’s technology will help LINX to develop a whole new network, facilitating its members to interconnect and share video through the cloud and other networks reliably, rapidly and cost effectively across fixed and mobile platforms. This new network will be developed in two phases.
LINX is an Internet exchange point (IXP) founded in 1994 by a group of Internet service providers. The Exchange is a not-for-profit organization and is a founder member of EURO-IX, an alliance of Internet Exchanges in Europe. It is currently the largest IXP in the world.
Juniper’s architecture will allow LINX to offer a sophisticated carrier platform, leveraging which it can launch new services such as VLAN tagging and 100G ports. Moreover, LINX can enhance its service and transport capabilities from end to end.
Success in the LINX arena will give Juniper an opportunity to showcase the relevance of its new network architecture.
In another development, Juniper announced that it will provide its SRX Series Services Gateways to Dell Inc. (DELL). Juniper’s offering will help the third largest PC maker to provide utmost security using its internal data center.
While the financial details of the deal remain unclear, a close association with Dell will undoubtedly benefit Juniper.
Considering the above deal wins, it can be well deduced that Juniper’s networking architecture, which runs on the Junos operating system is in demand. Junos is a reliable, high-performance network operating system for routing, switching and security. It simplifies networking operations while reducing the cost of ownership.
Despite its prospective deal momentum, we prefer to be on the sidelines based on a stiff competitive environment, continuous RD investments that weigh down on gross margin, European exposure and federal budget cuts.
Currently, Juniper has a Zacks #3 Rank, implying a short-term Hold recommendation.
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