Juniper acquires SDN startup Contrail Systems

Deal bolsters virtualization and SDN play
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Juniper Networks (NYSE: JNPR) on Wednesday acquired Contrail Systems, an emerging Software Defined Networks (SDN) vendor.

Like fellow SDN startup Nicira, which was purchased by VMware for $1.26 billion, Contrail was an early-stage startup that was founded early this year and still in stealth mode. In July, Contrail received $10 million in Series A funding from Khosla Ventures.

According to an 8K filing with the Securities and Exchange Commission, Juniper purchased Contrail on Dec. 7 for $176 million cash and stock. The filing also revealed that Juniper made an investment in the company earlier this year.

"As a strategic investor earlier this year, we recognized the inherent advantages of Contrail's architectural approach and we are excited to take this next step to acquire and combine Contrail into our team," Juniper said in a statement.

Although Contrail was supposed to make its grand debut to the world on Dec. 13, a report in The Register said it was developing an "open, standards-based software solution" and that its approach "contrasts sharply with other 'academic' SDN solutions that are not enterprise ready, do not scale, or work only with specific hypervisors."

By purchasing Contrail, Juniper will put itself in a better position to compete with the likes of its main rival Cisco (Nasdaq: CSCO), a vendor that's been building up its own SDN capabilities with the funding of a new 'spin in' SDN company called Insieme. In addition to Cisco, Alcatel-Lucent (NYSE: ALU), according to a Light Reading report, has also developed its own spin in company called Nuage.

In another interesting turn, Kireeti Kompella, Juniper's former CTO and Chief Architect, who left Juniper to become Contrail's CTO, will return to his old company.

For more:
- The Register has this article
- Light Reading has this article

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