HPE's $14B Power Play - AI Networking Dominance
The following is my own opinion of the HPE and Juniper merger based on my experience with the products and previous experience as being a customer of a merger. This should not to be interpreted as facts.
Back in 2017, a group of delegates sat in a room for Mobility Field Day 2. First time presenter, Mist Systems, introduced themselves - industry experts innovating in the Wi-Fi space. I was one of eleven delegates in that room fascinated by how Wi-Fi can be done better.
Fast forward 3 1/2 years later, Mist continues to disrupt the market. In 2019, acquired by Juniper Networks for $405 million. And this year, in 2024, HPE acquiring Juniper Networks for $14 Billion.
The story revolves around Artificial Intelligence (AI). Led by an “AI-Native Networking Leadership” and Mist AIOps. A trend so big and controversial in networking. This merger only propels AI further. HPE was sorely lacking AI, especially with Aruba Central. This is a big $14B investment in AI.
With Juniper CEO Rami Rahim leading the HPE networking business, I believe he will integrate MistAI deeply within HPE. A huge win for Bob Friday and his AI team. You can tell how passionate Bob is with AI when he shares what he’s been working on with the Tech Field Day community every year.
Goliath vs Goliath
But is the acquisition really about AI as much as it is about going toe to toe with Cisco? Aruba Networks did not build a competitive WLAN cloud solution against Meraki and Mist.
This is the way to compete directly with Cisco. By providing on-premises and cloud solutions. Cisco has developed a wide portfolio of solutions to address complex business challenges. And HPE’s acquisition of Juniper Networks will place them head to head with Cisco in Silicon Valley.
From a financial and share holder perspective, HPE views Juniper’s networking portfolio as higher margin and an advancement to its portfolio. It gains a large market share by teaming up with another competitor, merging as one, to tackle a common enemy.
Confusion
But what does this mean for the future of Aruba Networks? AI and cloud was missing from their story. How will HPE marry Aruba Networks and Mist?
Having a comprehensive portfolio causes confusion at many organizational levels. Internal consolidation is inevitable.
MistAI will proliferate HPE and obliterate Aruba Networks. This is the end of the road for them. The best of Aruba Networks will merge into Mist. We’ll see HPE undergo internal rebranding with products getting renamed.
But in the process of getting to that destination, the customer and the partner will need to work together to dissect the spaghetti of product skus, certifications, and shuffle of account managers, engineers, and business units.
Playing Cards Right
I feel confident with Rami Rahim leading the networking business. HPE and Juniper Networks do have a few complementary solutions. HPE’s 5G, Athonet could gain traction if integrated into the Mist dashboard. Juniper’s data center adds to a gap within HPE. Not to mention the top Fortune companies as customers.
A clash of solutions will take place within HPE and Juniper. We’ll keep eyes on how Juniper Networks’ acquisition of Witesand, a cloud-native NAC, continues to develop under HPE and their competing product, ClearPass, an on-premises solution.
And of course, the obvious overlap in Wi-Fi between Aruba Networks and Mist.
We will see products rebranded with new names and the best pieces of each being merged into one. But the real question is what team will be formed to build this future and what will be born in this industry as a byproduct of the HPE and Juniper acquisition?
