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Subject:  Re: Measuring Juniper vs Cisco Date:  3/29/2000  3:19 PM
Author:  gemini6706 Number:  1857 of 8810

It is true that Juniper's latest router is better than Cisco's router. There are few things I have to point out that are in Cisco's favor.

1) Most large customers like AT&T prefer a vendor that provide end to end solution rather than boxes and Juniper doesn't have an answer for that. They are very focussed in making one product right. Right now, they have 2 or 3 products that targets a particular segment. In order for Juniper to provide a wide array of products like Cisco, it is going to take a while for couple of reasons. The first reason is that the CEO of juniper doesn't beleive in acquisitions. He has made fun of Cisco acquiring so many companies. The second reason is that no company can quickly develop products as technologies evolve very fast. That's why acquisition is a solution. The acquisition and merger team in cisco is a well oiled machine. They have perfected the art of acquring new companies and successfully integrating with Cisco. Moreover, Juniper's customer are their investors. If they don't buy, who will buy their products.

2) In most cases, Cisco is not the first company that comes up with a prodcut to address the customers requirments. They are usually late but once they get in they are very aggressive and get the # 1 or # 2 postion in market leadership for that particular product.

3) Juniper had to offer a convertible debt of one billion dollars to keep the company afloat. The high valuation for Juniper's stock will not help in running the company. On the other hand Cisco has 15 billion dollars in cash.

4) Juniper is not able to attract talented engineers any more because they are valued so high and the stock is very volatile. Few weeks ago, when Nasdaq dipped, Juniper stock went down by 18 dolls. and Cisco's stock went down by 25 cents. I feel that the mutual funds would like to own Cisco stock over juniper.

The above points doesn't mean that Juniper will not grow past 40 billion dollars. I think they have still room to go. But on a very long term, Cisco is a better stock than Juniper.

This is my 2 cents.
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