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Cisco unfazed by HP/Aruba

WLAN leader says No. 2 provides "bolt on" solution

Cisco seems undaunted by HP’s nearly $3 billion acquisition of wireless LAN titan Aruba Networks. Cisco is the market leader in WLANs while HP gains a solid No. 2 position by acquiring Aruba.

Said Jeff Reed, vice president of Cisco’s Enterprise Infrastructure Solutions Group:

Enterprise mobility continues to be a key driver of growth in the networking industry. While some companies seek to bolt on wireless to their existing portfolios, mobility remains at the core of our networking business. As the clear market leader, we have delivered unified wired, wireless and cloud-managed platforms to our customers for years and will continue to do so.

Aruba is the third WLAN “bolt on” for HP, which has seen minimal success in the market up to now. The company acquired Colubris Networks in 2008 and inherited a WLAN portfolio from its $2.7 billion acquisition of 3Com in 2009.

Perhaps the third time is the charm. HP’s acquisition strengthens Aruba’s No. 2 position in the market, according to Dell’Oro Group analyst Chris DePuy.

The total WLAN Enterprise + Outdoor revenue share for HP, Aruba and Alcatel-Lucent, an OEM partner of Aruba’s, was 18% in 2014. This is still well behind Cisco’s market leading 50% share.

HP, however, will have significant exposure to China via its 3Com/H3C acquisition, while Cisco has considerable cloud managed revenue from its Meraki deal, DePuy notes.

Aruba's sales totaled $729 million in 2014 and is on track to break $1 billion by 2017, according to analysts. Aruba is HP's first major acquisition since CEO Meg Whitman announced last year that the company would split into two.

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