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Juniper Acquiring Contrail and Re-Acquiring Kireeti Kompella

Summary: The deal gives Juniper a much-needed SDN boost and fixes the vendor on a strategy that emphasizes Layer 3 rather than OpenFlow.

A day after Kireeti Kompella guest blogged on SDxCentral -- which set a record as the most-viewed guest blog on SDxCentral in a 24 hour period -- his former employer, Juniper Networks announced plans to acquire his SDN startup, Contrail Systems for $176M in stock and cash.

According to the SEC filing, Contrail will receive $57.5 million in cash plus 5,819,148 share in Juniper stock.

This deal was not a surprise to us -- and a smart move by Juniper.  We've heard multiple rumors since Contrail was funded that it was designed to be a Juniper spin-in from the beginning and given the vast number of former Juniper people at the company, this is no surprise.

For those who are not familiar with Contrail they are pitching a distributed network operating system with orchestration of common protocols such as BGP and XMPP.  It's also a good bet that we'll see MPLS included in this as well.

What does this mean:
  1. OpenFlow: expect less, not more OpenFlow support in Juniper products.  Contrail reinforces their strategy of focusing on layer 3 based technologies which if applied correctly -- drive less of a need for a programable TCAM that OpenFlow is driving today.
  2. Juniper:  Restocks their software team with leading technologies who understand enterprises (just look at the former Cisco, Aruba, Google folks at Contrail and you'll see what I mean) who can perhaps 'do-over' Juniper's attempt to expand into the enterprise market.  This also gives Juniper a clear SDN strategy to position with customers.
  3. Essentially positions Juniper and the Contrail to compete with other SDN architectures -- including Cisco, VMware, and OpenFlow.

Congrats to Ankur, Kireeti, and team!