Q: Juniper has been one of the only companies to successfully take on Cisco. How did you do it?
A: Actually, that wasn't what we were trying to do. It's like asking how Microsoft or Intel took on IBM. IBM was and is a wonderful computer company. Intel became the world's leading microprocessor company. And Microsoft is Microsoft. When history was written, what each of these companies were building were new industries.
In networking, companies who competed in the past tried to solve the same problem for the same customer as had already been done by companies like Cisco. It's very hard to be successful being late to a market with the same idea and solutions. It's much easier to be successful when you're first to a market with new ideas for fundamentally different problems.
I think one would have to agree that there is a radical difference between this new virtual network that is appearing in full bloom now as we enter the 21st century and the problems and solutions that were built in 1985 when Cisco began.
Do you think part of it was being in the right place at the right time? The collapse of the telecommunications market in 2000 and 2001 seemed to weed out a lot of start-ups that came on the scene right after Juniper.
You're right. Luck has a great deal to do with success. And it's important for anyone who has enjoyed any success to always remember that. Coincidentally, we had answers to problems that were becoming problems for our customers at the exact same time. As a result, we went from zero dollars to $100 million to $600 million in revenue in two years -- one of the fastest growth ramps ever. Certainly, we executed well, but that same execution at a different time would have had far less impact.
Speaking of Cisco, its core IP routing business was down 12 percent in the last quarter, according to several analysts. When Juniper reported earnings, core router sales were up. What's going on?
In simplest terms, it's just market share shift. If you were to look back over the last couple of years in the core market, our share has gone from somewhere in the teens to about 30 or 35 percent. Along the way, there have been blips up and down. This last quarter will be a blip up. But the quarter-to-quarter contest is not as important as the trend line.
