Juniper Networks (JNPR) is announcing some product news around their high end product that delivers 250Gbps and up to 4 Tbps total capacity to release the pressure for providers experiencing rapid grow in their networks.

Today, Juniper Networks is announcing a new generation of silicon that enables customers to quickly, efficiently and non-disruptively upgrade existing T Series Core Routers to a full duplex slot capacity of 250 Gbps without service interruption. The new chipset lays the foundation for a total capacity of 4 terabits per second (Tbps) in a single, half-rack system, ensuring that customers can continue to scale the T Series in line with rapidly accelerating service, subscriber and bandwidth growth.

Why is This Important

The growth in broadband and wireless has been amazing this past year.  More capabilities are coming for example  service providers streaming live video over 3G.  Damn: that will require some freaking blazing fast speed.

The only problem is that service providers have bandwidth issues and intensive video service can crush their, so they are limiting their application support over their networks. More video and smartphone services are driving change.   This is where the market is going and speed matters both in terms of moving packets and in terms of providers delivering more consumer services.

This is why this Juniper news is relevant.  Here is the Juniper Networks’ news:

Juniper Networks announced a new generation of silicon that will enable customers to quickly, efficiently and non-disruptively upgrade existing T Series Core Routers, the most widely deployed core router in the world, to a full duplex slot capacity of 250 Gbps without service interruption. The new chipset lays the foundation for a total capacity of 4 Tbps in a single, half-rack system, ensuring that customers can continue to scale the T Series in line with rapidly accelerating service, subscriber and bandwidth growth.

The unique ability to scale the T Series while in service represents a key component of Juniper’s overall commitment to investment protection, continuous systems availability and operational continuity. With Unified In-Service Software Upgrades, customers can upgrade Junos Software from one version to the next with minimal risk of service interruption.

“The T Series is a highly valued part of our core network delivering IPv4 and IPv6 routed services, in large part because of Juniper’s long-term product strategy and vision, which protects our investments in network infrastructure,” said Erik-Jan Bos, CTO at SURFnet, a subsidiary of the SURF organization. “This new silicon is an excellent example of Juniper’s commitment to investment protection. Just as we were able to upgrade T640s to T1600s, Juniper is again making it possible to extend the lifecycle of our core routers with a non-disruptive upgrade path that ensures the scalability to meet the continuous growth of traffic in our IP routed core.”

Exceeding 5,500 systems shipped worldwide to date, Juniper’s T Series is the only core router in the industry capable of supporting true line-rate 100 GbE interfaces. With the TX Matrix Plus, T1600 customers can evolve to multi-chassis systems at massive scale. The new chipset will further enable the scaling of single chassis systems up to 4 Tbps.

“Considering the growth in wireless and IP services, flexible high-performance network platforms that support 100 GbE are critical for the core of the network to scale efficiently and simply,” said Ray Mota, managing partner, ACG Research. “Juniper is providing their customers with the capability to leverage and expand existing assets to scale the core with maximum operational efficiency and investment protection.”

Built in 45-nanometer technology, the chipset yields total router throughput surpassing 4 Tbps, far exceeding the performance and scale of off-the-shelf silicon.

“The T Series is fundamentally different from any other router on the market because its architecture was designed to deliver leading core capacity and scale,” said Stefan Dyckerhoff, senior vice president and general manager, Core Business Unit, Juniper Networks.”

The first trials with products that use the new chipset technology are scheduled for the second half of 2010 and will be available for purchase in early 2011.

Translating the News Release:

1. Performance is key and networks have to deliver on the rapid pace of innovation at the edge (smartphones etc). Cutting through all the corporate BS it’s about speed and scale and it has to work. I’m checking on speeds but I believe Juniper beat Cisco hands down on speed. I have a request for comment from Juniper on that.

2. Investment protection means money- why rip and replace if you could use new chips and software to drive performance. Economics $$ is driving the behavior of the customers and upgrading fast and seamlessly is key for them.

3. 5,500 systems shipped means they have leadership – checking to see what Cisco’s numbers are, but Juniper is claiming market leadership.

4. Technology in 45 nanometer allows Juniper to build their own custom chip to exceed performance of off the shelf chips and apply software innovation onto the chip.  We saw this recently with Apple building their own chips for the key elements of their iPhone and Ipad – battery life.  Juniper is taking the same approach but applying it to core networks.

Interesting Timing and Positioning – Cisco vs. Juniper

This Juniper news comes the day after Cisco System (CSCO) announced their quarterly numbers – Cisco 2nd quarter earnings. In those earnings there wasn’t much on product leadership, but instead operational maneuvering and vision.

What’s interesting is the striking difference between Cisco and Juniper. Historically, Juniper has had product leadership over Cisco, but Juniper have always been in the shadow of Cisco due to Cisco’s sheer size.

Cisco’s core strategy is revenue growth, and they are going after tons of new markets.  These moves are pissing off previous partners (HP).  Plus, Cisco has $40 billion of cash in the bank to buy any competitive threat. These are real issues facing Cisco that their competitors don’t have – that is conflict with their customers and partners and a “boatload” of money $40 billion worth.

Now, I’m seeing many service providers focusing on making money by delivering and monetizing user interactions (content and services).  So what I’m hearing is that many service providers are saying to Cisco “Are you a content provider or a you an over the top yourself”.

Cisco is fighting and competing in many new markets. Yet, Cisco is constantly criticized for the lack of product and architecture leadership. Conversely Juniper is very focused on their core markets network and security – that is being a pure play networking provider. Juniper is smaller and nimble and doesn’t pound their chest like Cisco.

Is Cisco spread to thin? Is their size and organizational structure affecting their product and architecture leadership? Is Cisco unfocused in their core business? Do they care with all that cash in the bank (~40 billion – that’s huge)

New York Times had an interesting Angle on Cisco’s prospects yesterday:

Erik Suppiger, an analyst with Signal Hill, noted that Cisco had in fact struggled to meet the rising orders of customers. “They had product shortages across a number of lines,” he said.

Cisco, which has $39.6 billion in cash and investments on hand, has been one of the most aggressive acquirers in the technology industry. In the last year alone, the company spent more than $7 billion as it sought to advance its Internet video and wireless data product lines.

Mr. Chambers has declared a rise in video on personal computers and cellphones part of the next phase of the Internet. Such cheerleading comes naturally to him, because Cisco looks to sell more routers and switches to deal with the large files produced by video systems. In addition, Cisco makes video-conferencing systems for businesses and Flip video cameras for the consumer market. Cisco has used the lull created by the economic downturn to increase its investment in areas that are still nascent, like business and Web software, where it trails Microsoft and I.B.M. by a wide margin in both market share and reputation.

With sales of its core products once again on the rise, Cisco’s move into these smaller businesses is likely to come under more scrutiny from investors looking for growth, analysts said.

“The proof will be showing traction on some of these new products and initiatives,” said Jeffrey Evenson, an analyst at Sanford C. Bernstein & Company. “This is the year where their ability to execute will become more apparent.”

Translation: Cisco is all over the place and some are speculating that this impacts their product leadership and overall architecture. Cisco market posture basically says “they don’t care because they could buy any new product category”.

This issue with Cisco is the integration of disparate products and technologies which if not implemented properly can really cripple overall network performance.

At the end of the day Cisco is banking on vendor lock-in. Yet the world is demanding more for less (economics) and new performance thresholds to meet the demand for the users who all are pushing more packets into and out of the network – hello smartphones and video.

What Does This Mean

The consumerization of the network is putting pressure up and down the stack for more performance, software updates, security, and intelligence. This paradigm is changing the face of networking and the products required to support high performance, open, and dynamic networks.

Reading between the lines this Juniper announcement in context to Cisco (the Juniper Cisco debate) is a really big deal.

Here’s why: Core routing has been at the core of Cisco’s product leadership for years and this Juniper announcement is important for users and networks in three ways: 1) Juniper is delivering better performance and economics for customers, 2) the market needs performance as more users and businesses have more connected “smart devices”, 3) custom chips are essential for optimizing performance in networking 2.0 as highlighted by specialty devices getting custom chips such as the iPhone and iPad as Apple recently announced and now Juniper is doing it for core routing and networking.

In this new networking paradigm or Infrastructure 2.0 market (smart networks) the trend as highlighted by Apple iPhone and Google Android is putting massive pressure on service providers to deliver capacity and growth in their networks. Just look at all the complaints AT&T gets around the iPhone. The market wants more and the providers have to deliver. This is a real issue for providers to meet the demand of the market.

Did Juniper Trump Cisco in Leadership?

With this announcement today Juniper beats Cisco on performance in capacity. In checking around it’s apparent that Cisco doesn’t met the speed and performance of Juniper.

Cisco and Juniper Difference: Open verses Closed

At the end of the day we are seeing two strategies: Open verses Closed. If Juniper can enable more open innovation then the market will move with them.

If Cisco continues to play the lock-in game the market will reject that for better product and network architecture that is more relevant to their business goals (revenue vs cost) and what their users want (speed and performance).

The billion dollar question remaining is: Are service providers changing network architectures to meet new demands or will they stay with the single vendor approach? It will be interesting to see what direction will enterprises and service providers go?

UPDATE: I just confirmed that Cisco is indeed the inferior solution via Jim Duffy at Network Worlds post on Feb 1, 2010

Here is the summary from Jim Duffy at Network World:

Cisco is reportedly soon announcing a new carrier core router as a next-generation follow-on to the 6-year-old CRS-1, and a better competitor to Juniper’s T1600.

The MSC120 Cisco router will boast 120Gbps per slot, according to a bulletin issued over the weekend from Oppenheimer & Co., which will overtake the single-unit throughput of Juniper’s 100Gbps-per-slot T1600 and represent the “first major upgrade” to the CRS-1. Oppenheimer expects Cisco to unveil the MSC120 over the next month but that ASIC issues may push out delivery for another year or more.

“We believe Cisco has recently discovered issues with the supporting ASIC design, which could require a material redesign of the platform,”states Oppenheimer analyst Ittai Kidron in his bulletin. “This could delay product availability until mid-2011.”

Cisco said it did not comment on “rumors or speculation.” The company says it has shipped more the 3,200 CRS-1s since its May 2004 introduction.