May 22, 2002 7:20 AM PDT

Juniper continues global reach with NTT

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Juniper Networks announced Wednesday that it has signed a deal with NTT Communications to supply equipment and services for the Japanese carrier's global Internet network.

The agreement marks Juniper's second big move this week to extend its international business.

Juniper, a maker of Internet routers, said the deal with Tokyo-based NTT, the global carrier division of Japan's Nippon Telegraph and Telephone, will make it the sole supplier of Internet Protocol, or IP, infrastructure and services.

Juniper will supply NTT with its routing technology, including the new T640 Internet Routing Node, which the company says reduces network operation costs. Juniper will also work with NTT to improve services, the companies said.

Routers serve as a sort of "post office" for data, shuttling information to its destination based on IP, at both a network's core and at other junction points along the way.

NTT said the equipment will go into a new network that will extend throughout the United States, Europe and Asia. The move is part of NTT's strategy to move into the global arena with the most cost-effective IP network.

The deal appears to strengthen Juniper's growing interest in global customers.

The Sunnyvale, Calif.-based company on Monday announced plans to acquire Unisphere Networks, a subsidiary of Germany's Siemens, for roughly $740 million.

That move is expected to help Juniper compete against chief rival Cisco Systems, but analysts said it will also help the router maker expand its international business.

"In our view, the acquisition makes important strategic sense for Juniper," said Edward Jackson, an analyst at equity research firm U.S. Bancorp Piper Jaffray. "Juniper gains a worldwide Siemens reseller agreement spanning 190 countries."

David Jackson, an analyst at investment bank Morgan Stanley, also touted the international dimension of Juniper's acquisition. Unisphere derives 70 percent of its sales from international customers, Jackson said in a research note.

Juniper already has an extensive alliance with another European telecom and technology giant, Ericsson.

 

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