After years of dismissing a possible entry into the enterprise market, Juniper Networks' acquisition of security strong man NetScreen Technologies signifies a dramatic change of heart for the Cisco router rival.

The $4 billion deal is Juniper's invasion of corporate network territory where Cisco has a virtual monopoly. And for enterprise customers, it delivers something they have not seen for years - a competitor to Cisco for secure routing, which could lower procurement costs as the rivals bid for business.

NetScreen, with revenue of $223 million and 900 employees, is considered one of the top four or five IPSec VPN vendors. NetScreen also became an instant leader in Secure Socket Layer (SSL) VPNs with last fall's $265 million acquisition of start-up Neoteris.

But 75% to 80% of NetScreen's revenue comes from enterprise customers. Meanwhile, virtually all of Juniper’s revenue comes from service providers.

Though Juniper has had some exposure to enterprises in the government, defense, financial and educational research verticals - most recently the Global Information Grid - Bandwidth Expansion win with the Defense Information Systems Agency - the NetScreen deal is resounding affirmation that Juniper plans to focus more intently on this market. Acquiring NetScreen doubles Juniper's addressable market to $10 billion, Juniper CEO Scott Kriens says.

But it's also a drastic reversal of a vow Juniper made not to compete with its service provider customers by selling gear into the enterprise, a business model adopted by Cisco that Juniper resisted emulating until now.
Kriens attempted to explain the about face by claiming that the distinction between the enterprise and carrier markets was “blurring” or outdated.

“The distinction is not campus vs. carriers,” Kriens said during a conference call with analysts last week. “That’s the old way of looking at the problem. It’s not physical - it’s virtual. It’s better defined by the requirement for mission critical networks [where] the problems are important, complex and rapidly changing.”

Perhaps. Other observers say Juniper can no longer ignore the enterprise market if it wants to maintain its position as a leading equipment supplier.

NetScreen brings with it enterprise and small-medium business channels to sell Juniper's lower-end M5, M7i, M10 and M10i routers that are designed to replace the Cisco 7200/7500 series. Some analysts also expect Juniper to unveil small remote office/branch office routers with integrated security as well.