The Department of Justice’s (DOJ) lawsuit blocking Hewlett Packard Enterprise’s (HPE) $14 billion acquisition of Juniper Networks drew insight from industry analysts who noted the government agency’s reasoning did not align with reality.

The DOJ’s move focused heavily on HPE and Juniper’s current positions in the overall WLAN market, noting that a consolidation of the ecosystem’s No. 2 and No. 3 vendors would hurt market choice and innovation. It added that Juniper’s standalone market innovations have forced larger rival HPE to cut pricing and invest in its own innovations.

“Indeed, just a month before the proposed acquisition was announced, front-line HPE salespeople were concerned that ‘[t]he Juniper threat [was] dire’ because in dozens of opportunities Juniper was ‘trying to unseat’ HPE,” the DOJ wrote. “Senior HPE executives shared this view; one former HPE executive reminded his team that ‘there are no rules in a street fight’ with Juniper and encouraged them to ‘kill’ Juniper when going head-to-head for sales opportunities.”

HPE and Juniper both put out statements that they disagreed with the DOJ assessment and would “vigorously defend” the proposed transaction.

Some industry analysts called into question the DOJ’s reasoning behind the lawsuit, noting that a combined entity would form a more robust competitor in the market.

Siân Morgan, research director at Dell’Oro Group, in a blog post on the decision pointed to flawed DOJ analysis of the market, writing, “apparently [eight] companies with greater than [$18 million] each of WLAN revenue in a [$4 billion] North American market is too few.”

Morgan noted that this market fragmentation is only hindered by one dominate player in the space.

“In actual fact, the WLAN market is highly fragmented, with one large elephant in the room: Cisco,” Morgan wrote. “By developing a highly sophisticated global channel, a comprehensive suite of high-end networking products, and by means of a relentless sequence of acquisitions, Cisco is first – by a long stretch – in four out of five of the enterprise network segments we track. In the fifth segment, network security, Cisco is [No. 2].”

Morgan, who had previously extoled potential benefits of the HPE-Juniper combination, pointed to flawed DOJ reasoning that lumped all three of those players into a single argument.

“The Justice Department has indicated that the merger should be blocked because Cisco, HPE, and Juniper’s WLAN market share in North America is over 70%. The logic trap here is that 50 points of that 70% share are held by Cisco,” Morgan wrote. “Apparently, the Justice Department feels that Cisco is too big to allow HPE to acquire another WLAN vendor in order to compete with Cisco. If the courts buy into this is shampoo bottle logic (‘rather, rinse, repeat, lather, rinse, repeat ...’), the WLAN market in North America is likely to be trapped in the status quo for several years to come.”

Ron Westfall, research director at the Futurum Group, concurred, writing that, “I find it vexing that the product area which is the focus of the DOJ’s suit – … WLAN – is intensely competitive and diverse. The acquisition should prevail as I find this a most slender reed to oppose the completion of the deal.”

The deal has garnered approval from more than a dozen international regulatory bodies.

Are enterprises concerned about a combined HPE-Juniper? While some questioned the DOJ’s move, other analysts have expressed concerns over what impact the proposed deal could have on the enterprise space.

“I’ve had customers put things on hold right now, and not just the Juniper side but both sides,” André Kindness, principal analyst at Forrester Research, said in an interview with SDxCentral late last year about how Juniper and HPE customers are reacting to uncertainty around the deal. “Typically, if customers are strong enough to look outside of Cisco and they’re not a Cisco shop, then HPE, Aruba, Juniper are the primary ones that they’re looking at. I’ve had customers put some of that on hold at this point.”

HPE CEO Antonio Neri and that management team has attempted to temper these concerns by stating there is virtually no overlap between HPE and Juniper’s product lines, which Kindness said, “just boggles my mind.”

“I think [Neri’s] got to worry about the financial analyst out there in the stock market or the shareholders to pacify them, and then at the same time you don’t want to scare the bejesus out of your customer base, or Juniper customer base, so you’re going to say that there’s going to be either no overlap or no changes, everything will coexist,” Kindness added.

Cisco, for its part, has stirred some of that drama, with CFO Scott Herren telling the audience at an investor conference last year that HPE’s pending Juniper acquisition is causing “uncertainty” in the enterprise WLAN market that could be benefit Cisco.

“I think for sure that’s created just a degree of uncertainty and a question of, hey, should I consider if I was previously a vendor or a customer of either of those, now is the time to kind of open up and look at other opportunities,” Herren said. “And we’ve seen our wireless business, our orders greater than $1 million grew more than 20% in the fourth quarter.”