Fast-growing Ethernet Switch vendor Arista Networks announced plans to acquire Mojo Networks, an Enterprise-class WLAN vendor today. The deal is expected to close in C3Q18. This deal douses hopes that Arista may buy other WLAN vendors, in our view. Mojo Networks is unique in the WLAN industry: (a) it has a different business model from competitors, and (b) as of Aug 2018, it manages more Enterprise-class Access Points using Artificial Intelligence than other vendors. Arista says that it plans to use Mojo AI in its Cognitive Cloud Networking for Campus initiative.
Mojo Networks has taken revenue for cloud-managed services and has not taken revenue from the sale of Access Points. The Access Points are sold by distributors who make a small margin and drop ship them to Mojo Networks customers. The Mojo Networks revenue from cloud-managed services is significant when compared to other vendors in the Enterprise-class WLAN market. Additionally, because Mojo's Access Point selling partners charge only a small premium for the hardware, Mojo customers benefit with a lower total cost for the Access Points, than, say, Cisco or HPE Aruba Access Points.
Today Arista announced its entry into the campus market launching several products in the core and aggregation layer for campus switching. For years there has always been a blurry line on how one defines campus core, partially driven by the utility of the Cat 6500 installed base. But this has been changing as the Cat 6500 installed base gets refreshed with purpose built boxes.
For the most part, when an enterprise has two separate networks for the campus (user connectivity) and data center (server and compute access), campus core is counted in campus. When campus and data center are one network or the location is smaller the campus core is usually a portion of data center. This different deployment scenario has caused confusion in the exact size of the campus core market.
In our research we look at it in both use cases to better understand the too unique use cases as businesses truly look at it differently depending on their networking heritage and IT expertise.
What is happening now in the campus market is that campus switching is changing. Campus switching is transforming from a user connectivity role to an infrastructure role to support the change is how users connect and to support IoT which started with just cell phones and tablets, but is about to explode. With campus connectivity changing, so is the core and this is allowing enterprises to rethink their campus core.
Many customers will continue to see campus as a separate network, but many customers, especially when they are building a hybrid cloud data center are looking at merging the line between server compute and campus connectivity. We will see this architecture change at the same time the market moves towards MultiGig in the access layer and towards 25 Gbps and 100 Gbps.
The OCP Summit 2018 hit record attendance and we can can summarize the theme as that of continued disaggregation of network/server functions. Examples of demonstrations, presentations and proposals associated with disaggregation are as follows: