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Arista Networks Whisper

Arista Networks Whisper
 

Research Question: Will threats from white box and branded data switch competitors slow down Arista Networks’ growth?

Report Available: August 26, 2015

 

Blueshift’s initial research shows ANET receiving jubilant acclamation from Wall Street and is expected to continue taking share from market leader CSCO, however several sources inside the data center switching market believe white box switches and other branded competitors will take share from ANET.

 

Observations

  1. White box switches are gaining popularity. Some claim open source softwareworks just as well with white box switches and that companies like RHAT can effectively integrate and customize opens source solutions. Cumulus Networks claims ANET and CSCO have been cutting prices to prevent customers from switching to white box solutions. Cumulus is betting that white box will become the largest portion of the data switching market over the next five years. Gartner sees white box capturing 10% of the market by 2018, up from just 4% today.
  2. Blueshift’s June 30 Tech Trends Reportfound that ANET will continue to struggle in its attempt to take share from CSCO. Additionally, new generation vendors such as MLNX and Quanta Computers (TPE:2382) stand to give ANET a massive headache with their hyper-speed, software-defined cloud networking. Contract manufacturers have begun producing private label equipment that works just as well as its branded counterparts and is threatening all of the established switch vendors with its 60% to 70% lower pricing.
  3. ANET recently hitched its wagon to HPQin hopes of forming a partnership that can take down CSCO. The two companies hope to develop a “cloud-computing-in-a-box” solution that enterprises can plug their data centers into. Also, ANET will gain access to HPQ’s extensive partner network. According to HPQ partners, ANET has a higher conversion rate than CSCO.
  4. ANET has taken share from market leader CSCO, according to Crehan Research, from 6.7% in 2013 to 9.3% in 2014, and will eventually capture 20% to 40% of the branded Ethernet switch market. Another firm claims ANET continues to take share despite CSCO’s steep discounting activity. White box switches are not a threat according to ANET, which claims interest in white boxis coming from journalists and not its customers.

 

Will white box switch makers steal share from branded providers like ANET? Is ANET still taking share from CSCO? To gain insight into this trend with a specific look at ANET, Blueshift will gather data and issue a market research report from independent sources in the following areas: Large cloud developers, Mid-size cloud developers, Heavily-entrenched Cisco customers, White box manufacturers, Competitors, and Industry specialists.

 

Companies: Arista Networks (ANET), Cisco (CSCO), Hewlett-Packard (HPQ), Mellanox (MLNX), Quanta Computers (TPE:2382), Extreme Networks (EXTR), Brocade Communications System (BRCD), Juniper Networks (JNPR), Super Micro Computer (SMCI), Accton Technology (TPE:2345), EMC Corporation (EMC)