Juniper Networks, Inc.*(NYSE: JNPR)*and Cisco, together, own almost 80% of the core router market, but Alcatel Lucent SA*(NYSE: ALU)*is hoping to get a piece of this market in the future. Its recent product launch in the area, the 7750 edge router, climas to be five times as fast and 66% more power efficient than the typical core router.
This recent launch by Alcatel should concern Juniper the most. Cisco has a much more recognizable brand name and can leverage its size to reach markets faster with product diffusion.*Juniper competes head on with Cisco in the majority of its segments, which has been adversely impacting the company.*Juniper*tumbled 6% earlier this week after being hit with a downgrade at Goldman Sachs, moving the stok form a "hold" to a "buy."
The big hinderance for Alcatel is the fact that its ten largest customers account for over 40% total revenues, with AT&T and Verizon making up 10% and 12%, respectively. What's more is that the majority of Alcatel's customers are telecommunications service providers, which leaves the company with vast "customer risk".*
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