Juniper Networks Inc.
) recently announced that it will be joining hands with Korea-based
leading telecom operator
SK Telecom Ltd.
). Financial details of the deal were not mentioned.
Per the deal, Juniper will offer its cloud-based security
solution, vGW Virtual Gateway. The security solution will be
accompanied by Juniper's flagship SRX Series Service Gateways. Now,
it remains to be seen how these security services fare.
The vGW Virtual Gateway provides utmost security across
virtualized data centers and hybrid cloud environments. The SRX
Series Service Gateways allow secure Internet access and deliver
security across local area networks.
These two security suites will take care of the smooth
functioning of physical and virtualized IT systems. This will
ultimately help SK Telecom in delivering incessant data flow from
its data centers, which in turn would fortify its market
leadership. SK Telecom currently has a 50.0% share of the market in
The deal, in addition to its financial impact, seems to be very
important to Juniper. The networking vendor says that its security
suites have found a way to penetrate into Korea via SK Telecom.
This could undoubtedly be an excellent opportunity for the company
since data center growth prospects in Korea seem immense.
Juniper's acquisition of Mykonos Software in February 2012 for
$80 million should work in its favor. Mykonos' technological
capabilities will improve Juniper's security products, a business
in which the company has struggled to stand up against rivals such
) and Palo Alto Networks Inc.
Juniper remains a key player in the networking market, but the
increasing focus on security has created a big opportunity for the
company. Additionally, the core routing segment in the U.S. is
becoming increasingly competitive because of lower-cost solutions
coming to market. So this is the right time for the company to
generate a fast-growing adjacent segment. The fact that
international opportunities are also unfolding is a big
Despite Juniper's strong product line-up and continuous deal
wins, we are a bit cautious about its first quarter 2012 results,
which missed the Zacks Consensus Estimate. Moreover, stiff
competition from industry stalwarts such as
Cisco Systems Inc.
), as well as Juniper's European exposure could weigh on the
Currently, Juniper has a Zacks Rank #3, implying a short-term
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