When the pandemic hit last spring, employees suddenly began working from home, enterprises quickly shifted applications to the cloud, and secure remote access became critical. As we move (hopefully) beyond the pandemic, it’s clear that enterprise networking has been changed forever.
Companies are looking at new technologies like SASE to combine networking and edge security into one manageable platform. Zero-trust network access has moved from the back burner to the hotseat as companies seek a more effective way to fight cyberattacks in a world where the traditional perimeter no longer exists. The lines between security and networking are blurring, with traditional security companies moving into the networking realm, and networking companies upping their security game.
Companies that made in our top 10 most powerful in enterprise networking have demonstrated that they have a clear vision for the future of networking and that they have a solid game plan for achieving their goals.
(Editor’s note: Power is a subjective quality, and this list is not a ranking based on simple, quantifiable metrics. Our list is ordered, with input from industry watchers, to reflect the companies that are making the biggest power moves and the broadest impact on the network industry.)
1. Cisco: Staying ahead of the pack with SASE, Zero Trust, IoT and NaaS
Why they’re here: There’s a reason why nobody has been able to knock Cisco off its perch as the dominant networking vendor. You’re never going to outflank Cisco. SASE? Cisco’s got it, with an integrated bundle that includes technologies from strategic acquisitions like Meraki for SD-WAN, AnyConnect for remote access and Duo for Zero Trust. How about networking-as-a-service? Check. Cisco recently announced a subscription-based NaaS service called Cisco Plus. IoT? Cisco’s got that covered with end-to-end IoT solutions, including its new 5G industrial router portfolio. Oh, and Cisco remains the market leader in core categories like Ethernet switch revenue: The pandemic knocked Cisco’s 2020 switch revenue down nearly 10%, but Cisco still holds a leading 39% market share, according to IDC. (By way of comparison, Juniper’s switch market share was 3%.)
Power Moves: Cisco has been on a buying spree of late. Acquisitions include Fluidmesh (Industrial IoT and connected vehicles), Kenna Security (vulnerability management), and Sedona Systems (software-defined networking).
By the numbers: $12.8 billion: Cisco reported Q3 revenue of $12.8 billion, up 7% on strong growth in security (up 13%), infrastructure platforms (up 6%), and applications (up 5%.)
Outlook: As enterprises reinvent their business models in the post-pandemic world, IT spending is expected to increase in a variety of areas–IoT, SASE and Zero Trust among the top three. By offering a broad portfolio of hardware, software and services, Cisco is well positioned to take advantage of the desire by CIOs to reduce their reliance on point products and settle on a limited number of strategic partners.
2. VMware: Free at last, VMware is poised for innovation and growth
Why They’re Here: VMware has successfully expanded its product portfolio from server virtualization into containers, security, cloud migration, cloud management, endpoint management, SD-WAN, hyperconvergence and advanced networking. But it’s been an eventful past few months for VMware. In January, CEO Pat Gelsinger jumped ship after 10 years at the helm and went back to Intel, where he had previously worked for 30 years (although he doesn’t look old enough to have been in the industry that long.) As if that weren’t unsettling enough, in April, Dell dropped a bombshell, announcing that it was spinning off VMware. (EMC acquired VMware in 2004; Dell bought EMC in 2016, and VMware was part of the deal).
Power Moves: Becoming an independent company again is probably the biggest power move of all for VMware, which has had to play nice with EMC and Dell, both essentially hardware companies, while at the same time trying to continue to be an innovator that moves at the speed of software.
By the numbers: 81%: In Dell’s record breaking $67 billion purchase of EMC, it acquired an 81% equity stake in VMware. According to the terms of the spin-off, the sale will generate an estimated $9.5 billion, which Dell will use to help pay down the massive debt it accrued in the original purchase.
Outlook: The relationship between Dell and VMware has always been something of a mismatch. VMware prided itself on operating independently, but it was still owned by Dell, its products were sold through Dell channels, and the two companies developed technologies together, such as hyperconverged infrastructure. While VMware and Dell will continue their close working relationship, analysts say the spin-off will enable VMware to become more agile and the increased level of independence will allow it to potentially strike deals with Dell competitors.
3. Arista: Targeting the cloud with AI-driven security and networking
Why they’re here: Arista understands that simply gobbling market share from Cisco in the high-speed switching market and being overly dependent on revenue from Facebook and Microsoft isn’t a winning strategy for sustained growth over time. The company is diversifying its product portfolio, taking aim at the campus switching market, providing network management, and moving into areas like security, IoT, and AI. Arista recently announced a Zero Trust offering based on network segmentation. And the days of emphasizing speeds and feeds are in the rearview mirror; today Arista bills itself as a “cognitive cloud networking” company.
Power Moves: Purchased Awake Security, which provides AI-driven proactive threat detection for IOT campus networks.
By the numbers: 16.3%: Over the past decade, Arista’s market share in high-speed switching has climbed from 3.5% to 16.3%. (Cisco’s has slid from 78.1% in 2012 to 43.7% in the first half of 2020.)
Outlook: Under the steady leadership of Jayshree Ullal, one of the few women CEOs in tech, Arista has emerged from the pandemic in pretty good shape. The company reported a 27% increase in first quarter revenue growth and healthy operating profits of nearly $200 million. As Constellation Research analyst Holger Mueller puts it, “Arista Networks is great example of how good things happen when you have attractive products and manage a company commercially prudently during pandemic times.” He adds, “On the product side Arista is doing well with the focus on AI-powered security networking.”
4. HPE/Aruba: Stakes out leadership position in SASE
Why they’re here: HPE’s Aruba has assembled a powerful set of capabilities for enterprises that need to integrate wired and wireless LANs, edge infrastructure, and cloud access for branch offices and remote workers in a way that’s automated and secure. Gartner puts Aruba in a leadership position in the wired/wireless LAN access market, pointing out that “the functionality of Aruba ClearPass (secure network access control) and AirWave (network management) continue to set the bar for the market,” adding that “Aruba continues to be an influencer of competitive trends in the market.” Meanwhile HPE is advancing its GreenLake on-prem cloud, consumption-based offering with plans to offer every one of its services and products through GreenLake leasing by next year.
Power Moves: Bought SD-WAN powerhouse Silver Peak, one of the major challenger’s to Cisco’s dominance in the SD-WAN market.
By the numbers: $925 million: The amount that HPE (which bought Aruba six years ago) shelled out for Silver Peak.
Outlook: By integrating Silver Peak technology into its product lines, Aruba has emerged as a leader in the emerging SASE market, according to a new report from the 650 Group. And in its latest earnings report, HPE said that its Aruba-based intelligent-edge revenue was $806 million, up 12% year over year. HPE said it expects Aruba “to continue to take share in both campus switching and WLAN.” However, the outlook for Aruba became a little less clear in early June when co-founder and longtime CEO Keerti Melkote announced that he’s leaving the company after 19 years. In addition, Aruba’s longtime CTO Partha Narasimhan and Chief Architect Pradeep Iyer also left the company. HPE has named Phil Mottram, the senior vice president of HPE’s Communications Group, to replace Melkote at CEO, and Silver Peak’s David Hughes will become chief product officer and CTO. One of Aruba’s strengths has been its stable leadership team, which has driven innovation for nearly two decades, so a shakeup of this magnitude is notable. The fact that HPE selected someone from outside Aruba to take over is also notable. Melkote and his team managed to maintain Aruba’s independence within the HPE family, so that will be something to watch as the transition unfolds.
5. Extreme Networks: Integrating recent acquisitions for future success
Why they’re here: Extreme Networks went on an acquisition spree between 2016 and 2019 (Zebra Technologies for WLAN, Avaya’s networking business, Brocade’s switching, routing and analytics, Aerohive’s Wi-Fi 6 gear, SD-WAN software, and cloud management services). It has worked hard to integrate those products and technologies and to come out the other end with a coherent strategy. According to Gartner, Extreme has “successfully” integrated the fruits of its acquisitions and rate it as a leader in wired- and wireless-LAN access infrastructure. “Extreme delivers a broad portfolio of cloud-managed and on-premises managed network application and services in conjunction with its end-to-end wired switching and WLAN products,” says Gartner.
Power Moves: At its latest user conference, Extreme announced its overarching vision for the future, which is calls the Infinite Enterprise. The idea is that in our post-pandemic world the enterprise needs to accommodate the requirements of a global, hybrid workforce. The key tenets are distributed connectivity, scalable cloud and a consumer-centric user experience.
By the Numbers: 122%: The year-over-year growth of the ExtremeCloud IQ cloud-management subscription service.
Outlook: If the latest fiscal quarter is any indication, Extreme is poised to cash in on its bet on cloud management, automation and AI. Revenue was up 21% year-over-year and president and CEO Ed Meyercord is bullish: “Extreme is coming out of COVID in a stronger position than ever before, and enterprise customers are turning to Extreme’s industry-leading cloud solutions to meet the new demands of the distributed enterprise.”
6. Palo Alto Networks: From firewalls to a cloud-security platform
Why they’re here: The originator of the application-aware, next-generation firewall, Palo Alto Networks has successfully broadened its scope through a parade of acquisitions over the past three years: cloud-security company RedLock, security-orchestration company Demisto, container-security company Twistlock, serverless-security startup PureSec, IoT startup Zingbox, micro-segmentation company Aporeto, and SD-WAN company CloudGenix. Palo Alto has integrated those acquisitions into a broad cloud-security platform called Prisma Cloud that addresses security throughout the application lifecycle. And it has leveraged the CloudGenix acquisition to become a leader in SASE, according to Gartner.
Power Moves: In November, Palo Alto announced its intent to acquire attack-surface management vendor Expanse for $800 million. And in February, it bought cloud-security company Bridgecrew.
By the numbers: $800 million. The amount Palo Alto paid for Expanse.
Outlook: Palo Alto is well positioned to build on its popular core firewall business with revenue from fast-growing areas like SD-WAN, SASE, and cloud security. The company is also successfully shifting to a subscription model, with its firewall-as-a-service offering. And most recently it boosted its Zero Trust offering with a Cloud Identity Engine that allows customers to authenticate and authorize users across enterprise networks, clouds, and applications. The strategy seems to be paying off: Revenue grew 24% year-over-year in the quarter ended on April 30 to hit $1.07 billion.
7. Fortinet: A broad platform for security/networking convergence
Why they’re here: The confluence of security and networking has been the perfect storm for Fortinet. The company has leveraged its homegrown product lines of next generation firewalls, anti-virus, SD-WAN, Ethernet switching, and wireless gear to grab a power position in SASE, Zero Trust and cloud management. Gartner says Fortinet catapulted from niche player to visionary in its latest Magic Quadrant for wired and wireless LAN infrastructure with its “security-focused, full-branch/campus network stack of wired, wireless, security, and edge networking.” Gartner also cites Fortinet’s improvements in its automation of network security and IoT management.
Power Moves: Fortinet recently bought OPAQ Networks, which has a Zero Trust network-access cloud offering.
By the numbers: $34M. What Fortinet paid for Panopta, whose tools automate the management of servers, containers, applications, databases, cloud infrastructure, and virtual appliances.
Outlook: Brothers Ken and Michael Xie founded Fortinet nearly 20 years ago and are still at the helm; Ken is CEO and Michael is President and CTO. Their steady leadership and foresight has enabled Fortinet to purpose-build its products so they integrate into platforms like the Fortinet security fabric and the Fortinet cloud-management system, which can all be run from a single console. In its latest quarter, Fortinet announced strong results, with total revenue up 23% year-over-year to $710 million. (It should be noted that this spring the FBI issued a warning that hackers had successfully exploited vulnerabilities in the Fortinet OS. In response, Fortinet noted that the vulnerability was an old one, and urged customers to update their software to the latest version.)
8. Juniper Networks: Embedding AI throughout its product lines
Why it’s here: One of the handful of original networking vendors still standing, Juniper is making aggressive moves to transition to growth areas like SASE, artificial intelligence, SD-WAN, wireless, and intent-based networking. Juniper is having success leveraging its 2019 purchase of wireless innovator Mist Systems and rolling out products that take advantage of Mist’s AI capabilities across data center, cloud, and hybrid environments. Gartner says Juniper is a visionary in WAN-edge infrastructure with “a comprehensive solution including solid capabilities with SD-WAN, operations, deployment flexibility and strong security.” And Juniper is a leader in Gartner’s Magic Quadrant for wired- and wireless-LAN access infrastructure based on its AI-driven technology.
Power Moves: In January, Juniper bought intent-based networking (IBN) pioneer Apstra and its Apstra Operating System.
By the Numbers: $450 million: What Juniper paid in December to acquire 128 Technology, which offers intelligent routing software that reduces the cost of running SD-WAN and WANs.
Outlook: No question that Juniper has struggled over the past several years to offset declines in service-provider revenues. Juniper’s annual revenue hit $4.8B in 2015 and was only $4.45B in 2020. But analysts say that Juniper may have turned the corner. Juniper reported an 8% increase in revenue in its latest quarter. And the infusion of new technologies and new talent from the recent acquisitions provide Juniper with opportunities to take leadership positions in areas like data-center automation, SASE, open networking, SD-WAN, and artificial intelligence.
9. Nvidia: Banking on AI in enterprise data centers and hoping for regulatory approval of Arm deal
Why they’re here: An innovator and longtime power player in the gaming world, Nvidia wants to be a leader in the deployment of AI in enterprise data centers. Nvidia made two major acquisitions last year–purchasing smart-switch maker Mellanox for $6.9B and open-source networking OS vendor Cumulus. The moves gave Nvidia a full-stack offering from high-performance graphics processors to a software platform upon which to build industry-specific AI-powered applications. Nvidia has also partnered with key industry vendors like VMware and RedHat to make sure its GPUs are integrated across a wide range of platforms.
Power Moves: As if those key acquisitions weren’t enough, Nvidia in September announced the blockbuster purchase of Arm Ltd., which doesn’t produce chips itself, but licenses its microprocessor technology to major computer hardware and smartphone OEMs.
By the numbers: $40B: The amount that Nvidia is paying for Arm.
Outlook: Nvidia is well positioned to cash in the momentum toward using AI in data-center, cloud and edge scenarios. However, opposition to the Arm deal seems to be intensifying, throwing into question whether regulators will approve the deal. Google, Microsoft, and Qualcomm have objected, raising concerns about whether they will continue to have equal access to Arm technology after the acquisition closes. The U.S. Federal Trade Commission has opened an investigation, and in April, the UK (where Arm is headquartered) announced plans for its own probe of whether the deal endangers the country’s national security. On top of that, Nvidia needs approval from China, where Arm’s owner SoftBank is located, and trade relations between the U.S. and China are pretty frosty these days. In any event, Nvidia CEO Jensen Huang remains confident that he can navigate the regulatory hurdles and get the deal approved.
10. Dell Technologies: Shedding assets, focusing on data-center modernization
Why they’re here: With mercurial Michael Dell at the helm, the company is never predictable. First, it shelled out $67 billion to buy EMC, which owned VMware. Now, it’s spinning off VMware in order to collect around $9.5B, which will be used to help pay down the debt that was incurred when it bougth the company in the first place. According to Michael Dell, the move is good for both companies in that each will gain some level of independence. He says Dell’s focus going forward is on data-center modernization, its growing PC business, and building an open ecosystem for hybrid and private cloud, edge, 5G, telecom and data management. Dell also wants to be a leader in the IT-as-a-service market with its APEX initiative.
Power Moves: In addition to the VMware spin-off, Dell is selling its Boomi data integration software business to a private equity firm.
By the numbers: $4B: The amount that Dell gets for Boomi, money that is expected to help pay down debt.
Outlook: Will the VMware spinoff actually change anything or is it just an accounting trick? That remains to be seen. After all, Michael Dell will continue to be VMware’s chairman. And VMware has signed a five-year commercial agreement to work together with Dell on hyperconvergence technology and to share sales teams and financial services, so that’s not a clean break. In any event, this was certainly not a fire sale. Both companies are doing well and expect to do even better in the future. Dell has assembled a powerful lineup of servers, storage and networking products, which it has aggregated into the market leading hyperconverged system at 32.6% market share, according to IDC. In its latest quarter, Dell reported that its Infrastructure Solutions Group had revenue of $7.9 billion, up 5%; servers and networking revenue was $4.1 billion, up 9%, while storage revenue was flat. Operating income in the segment was $788 million, up 8%.