Juniper buys WLAN pioneer Trapeze for $152 million

The purchase fills a gaping hole in Juniper's enterprise networking portfolio

Juniper Networks, as expected, has agreed to acquire and Belden's Trapeze Networks wireless LAN unit for $152 million in cash.

The purchase fills a gaping hole -- WLANs -- in Juniper's enterprise networking portfolio. Juniper had been evaluating WLAN players to acquire for the past two years, according to David Yen, executive vice president and general manager, Fabric and Switching Technologies, at Juniper; but the industry had been expecting Juniper to enter the WLAN market for even longer than that.

"We believe the deal makes abundant sense given Juniper's current lack of a wireless LAN strategy and the growing value of wireless LAN products at the edge of the network. Trapeze's well-regarded WLAN products will complement Juniper's growing enterprise switching presence and position it better against the competition," states Jason Ader of investment firm William Blair & Co., in a bulletin on the purchase. "According to Gartner, more than 60 per cent of end users purchased their WLAN solutions from the same vendors as their wired LANs, meaning that Juniper has likely been leaving a lot of opportunity on the table."

In acquiring Trapeze, Juniper enters another market led by rival Cisco. Trapeze, however, is a distant competitor -- its share of the $1.6 billion enterprise market in 2009 was 2.2 per cent, according to Dell'Oro Group, trailing Cisco, Aruba, Motorola, HP, Meru and Alcatel-Lucent.

Juniper, citing Dell'Oro data, says the enterprise WLAN market is expected to grow from $2.2 billion in 2010 to $3.4 billion in 2014.

Trapeze was one of a pack of start-ups that pioneered the concept of the "wireless LAN switch," linking with so-called thin access points to centrally control and secure WLANs, and allow clients to roam seamlessly. Juniper singled out its Smart Mobile WLAN architecture for centralized and distributed networking and "intelligent switching," which is designed to allows organizations to deliver voice for hundreds of users and scale WLANs across the enterprise without compromising security or manageability.

Trapeze owns the largest number of patents in WLANs -- 17 -- with 49 more pending, Yen says. He says this, as well as Trapeze supplying Juniper with WLAN equipment for several years, led to Juniper's decision to pick Trapeze over its competitors and peers.

"They are well regarded in the industry," Yen says. "Their architecture is the best for scale and reliability. And they are complementary to Juniper's strategy."

Now that the industry is much more mobile, "it was time for us to include wireless," Yen says.

Trapeze has more than 6,000 customers, including OEM relationships with 3Com, Enterasys and Nortel.

Belden acquired privately held Trapeze in 2008 for $133 million in cash to add a controller-based WLAN product line to its existing copper and fiber-optic cabling, cable management and connectivity products. Belden attempted to position itself as a supplier of unified wired and wireless products buts sources say Belden has done little to capitalize on the acquisition.

Juniper will inherit 127 employees from Trapeze. The acquisition is expected to close before the end of the year.

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Tags Gartnerbusiness issueswirelessNetworkingjuniper networkscorporate issuesacquisitionsmergersMergers / acquisitionsWireless ManagementTrapeze NetworksJuniper acquiring Trapeze

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