Juniper to launch the T1600

Juniper Networks plans to sell a new core router, called the T1600, in the fourth quarter of 2007 that will direct Internet traffic for large networks such as telecoms and cable television companies. The T1600 has higher capacity and density than Cisco’s CRS-1, with lower requirements for power and cooling. It will be Juniper's first major upgrade to its core router line-up in five years.

It is true that Juniper will likely gain share in the router market in 2008 with a new product due for sale later this year, although rival Cisco Systems will not cede its dominance. Today, most analysts estimate Cisco's market share in core routers to be around 60 percent, compared to around 30 percent for Juniper.

No question that this was a much-needed move for the company after it lost share to Cisco's high-end router, the CRS-1, in the past few quarters. Telecoms carriers and cable television companies have been upgrading their networks to handle increasing data traffic, including Internet-based video services, which require advanced core routers. So, Juniper really needed to make a come back in high-end routers if there are in fact serious about competing with Cisco.

What’s the real impact for Cisco? Probably, very little. This is more good news for Juniper than negative for Cisco. The T1600 certainly does improve performance. However, any shift in market share is likely to emerge in the second half of 2008 into 2009, and Cisco could also announce some improvements to its CRS-1 in the meantime. Some analysts said Cisco and Juniper will remain leaders in core routers for a while, but there may be more competition ahead from French equipment maker Alcatel-Lucent and smaller firms like Foundry Networks. However, with the heavy investments required to develop such types of core routers, there is modest risk that it would affect market share for Cisco and Juniper.