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    Juniper Networks Annual2001 Report


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    GLEN


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    Financial Highlights Statements of Operations Data (In thousands, except per share amounts) Years ended December 31, 2001 2000 1999 1998 1997 Net revenues $ 887,022 $ 673,501 $ 102,606 $ 3,807 Pro forma net income (loss)(i) $ 169,947 $ 184,036 $ (4,748) $ (29,736) Pro forma diluted net income (loss) per share (i) $ 0.50 $ 0.53 $ (0.03) $ (0.40) Net income (loss) $ (13,417) $ 147,916 $ (9,034) $ (30,971) $ (10,363) Diluted net income (loss) per share $ (0.04) $ 0.43 $ (0.05) $ (0.40) $ (0.20) Shares used in computing diluted net income (loss) per share 319,378 347,858 189,322 77,742 51,546 (i) Pro forma net income (loss) excludes the amortization of goodwill and other intangibles, deferred compensation, in process R&D, write-downs of equity investments, restructuring costs, one-time contract manufacturing charges, and charitable contribution charges in all applicable periods. Pro forma amounts are unaudited. All results reflect the three-for-one split of common stock effective January 18, 2000 and the two-for-one split of our common stock effective June 16, 2000. Balance Sheet Data (In thousands) As of December 31, 2001 2000 1999 1998 1997 Cash, cash equivalents and short-term investments $ 989,642 $ 1,144,743 $ 345,958 $ 20,098 $ 46,227 Working capital $ 883,829 $ 1,132,139 $ 322,170 $ 14,432 $ 44,691 Total assets $ 2,389,588 $ 2,103,129 $ 513,378 $ 36,671 $ 50,210 Total stockholders’ equity $ 997,369 $ 730,002 $ 457,715 $ 17,065 $ 46,048 4,519 54,894 1,227 927 42,144 3,082 335 494 156 31 N/A N/A 1998 1999 2000 2001 1998 1999 2000 2001 1998 1999 2000 2001 Units Ports Employees Actual results could differ materially from those anticipated in forward-looking statements in this document as a result of certain factors, including those set forth in the risk factors described in the Company’s SEC filings, including the annual report on Form 10-K.


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    To Our Shareholders The past year has presented challenges for service providers, network operators, and for all suppliers of networking infrastructure selling into these markets. The industry began 2001 with early indicators of a pending downturn and ended with confirmation that it would indeed be a difficult period. Yet despite these obstacles, Juniper Networks more than doubled its customer base to over 500 service providers and carriers in 47 countries around the world, and ended the year with a 32% increase in revenues. Juniper Networks three fundamental goals as we began the year were to continue our investment in innovation, build our market footprint around the world in major accounts, and maintain our financial Our commitment to innovation boosts fundamentals. During 2001 the company expanded trust and attracts new customers its investment in new and existing markets and met We are pleased to post positive sales targets for extending our technology and product growth for 2001, and to be able to take advantage portfolio lead in multiple markets. We maintained of the differentiation this result makes possible in our ability to meet schedules for product develop- a difficult market. The focused execution of the Scott Kriens ment to support investment in market development company’s strategy allowed us to deal with adverse Chairman, President and efforts that further expand our business. business conditions by avoiding short-term measures Chief Executive Officer The Juniper Networks customer base today that would have hampered technology innovation includes many significant new network operators and leadership. Our continued research, develop- in all major markets of the world, in mobile, cable, ment and market expansion investments resulted in and the edge, as well as continued success with our four major software releases and 37 new system initial backbone core network customers. We have interfaces shipped during the year. Our portfolio of maintained the financial internals used to measure best-in-class core and edge products now includes the fundamental health of our business. Company six Internet router platforms, consistent software margins remain intact at nearly 60%. Days Sales features throughout our entire product portfolio, Outstanding are within the stated 55-65 day range, and 107 hardware interfaces that address a variety operating income as a percent of revenue remains of access speeds and types. solid, and cash flow from operations has been We also offer many new Internet Protocol (IP) positive and substantial throughout the year. service capabilities such as Virtual Private Networks (VPNs), that help service providers rapidly provision these new revenue-generating services at scale. Juniper Networks established base of service provider customers, including both new carriers as well as many incumbent providers, provides the company with the installed base and the resulting credibility to execute an expanded strategy as we enter 2002.


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    “ ” By leveraging our industry-leading technology and established business relationships into new related markets, Juniper Networks is helping customers rapidly create new revenue Juniper Networks creates new streams and stimulate more demand for its leading IP revenue opportunities with solutions routing products. for multiple markets Scott Kriens Chairman, President and CEO Juniper Networks business strategy is to sell service providers the fundamental IP infrastructure solutions for profitably building the New Public A vision matching the needs of service Network—a multipurpose conduit for multiple data, providers and their customers voice, and video services based on the Internet Juniper Networks vision of the New Public Protocol (IP). Unlike legacy networks used by single Network reflects the new way that enterprise users for one purpose, the New Public Network customers are using IP network services. In an requires a broad array of core and edge routing effort to trim operating costs, many businesses are technologies to provide multiple services on the focusing on their core competencies and outsourcing same network. With the acquisition of Pacific activities such as building and operating networks. Broadband Communications, Juniper Networks Outsourcing allows customers to do what they do builds on its leadership position in core and edge best—run their business—while network operators infrastructure for service providers and carriers by can do what they do best as well, which is to operate offering cable multiservice operators products that networks. The New Public Network is moving routing integrate two-way, high-speed IP applications using intelligence and service provisioning, along with the the Internet with cable systems. We are also very associated complexity, off the customers’ premise pleased with the progress of our joint venture with equipment and into the network. Ericsson, which targets products and solutions for users of mobile data services who need the same Juniper Networks provides complete support high-performance capabilities in the mobile market. for service providers’ requirements for New Public Network technology. The company strategy aligns By leveraging our industry-leading technology the respective business models of building value in and established business relationships into new the public network and making life easier on the cus- related markets, Juniper Networks is helping tomer premise. These shared goals lay the foundation customers rapidly create new revenue streams for a mutually profitable business partnership. and stimulate more demand for its leading IP routing products. However, executing this strategy Company focus and execution remains requires more than a broad product portfolio. the hallmark of our business Success requires a company vision and business Juniper Networks management and its more model in sync with our customers’ requirements— than 1,200 employees are excited to spearhead the service providers of the New Public Network. the company’s vision of the New Public Network with dedication and continued focus. With new vital technology and products, expanded markets, and a clear commitment to our service provider customers, Juniper Networks is poised to leverage the global market for expansion and growth. I would like to thank our employees, customers, suppliers, our business partners, and our investors for their continued confidence and commitment to Juniper Networks. Scott Kriens Chairman, President and CEO


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    Deliveringin Value Public the New Network Our business Backbone Core Market Juniper Networks develops and sells Internet Protocol (IP) infrastructure The core of service provider networks needs to provide a unique combination of speed and systems to more than 500 service providers and carriers worldwide. intelligence to scale network offerings on demand Since 1996 our purpose-built approach to product design has helped at the edge of the network. Our product portfolio for the backbone core routing market includes a wide service providers develop and exploit intelligent IP networks. Juniper range of hardware, software, and interface card options. In 2000, Juniper Networks introduced the Networks products offer service providers and carriers a wide range of M160 Internet router, the industry’s first 160 million packet-per-second system and the first platform to concurrent IP services to accelerate the on-going carrier transition to support OC-192c connectivity. Juniper Networks IP in four specific markets: backbone core, edge, cable, and mobile continues to help service providers scale and future proof their networks. The current six M-series Internet networks. During 2001 we expanded our product offerings systems offer scalable network support of up to 32 OC-48c/STM-16 Physical Interface Cards (PICs) to cover all four of these network markets. We also grew our global and up to 8 OC-192c/STM-64 PICs per chassis. Smaller core configurations are available for customer base via national Postal Telephone and Telegraph customers interprovider peering, which offers customers highly customized selections of bandwidth and PIC (PTTs) including Chungwha Telecom, Deutsche Telekom, France Telecom, capacities. Consistent performance, ASIC-based Polska Telekom, Telefonica, and Telia. Juniper Networks continues to features, and JUNOS software running across all Juniper Networks platforms increases operational concentrate on global customers to deliver secure, scalable IP routing, efficiency while reducing complexity and costs. Edge Market intelligent edge services, cable infrastructures, and mobile cores. In early 2000, service providers began building out the intelligent IP edge portions of their networks. The Leading with innovation edge of the network is where our customers create Juniper Networks first shipped the M40 and deliver numerous IP services that represent Internet router in 1998. We have continued to increased revenue opportunities. Juniper Networks an annual investment in research and development add innovation and build customer trust with substantially boosted customers’ capabilities to that totaled $155 million in 2001. In the last each successive release of M-series platforms deliver edge and access services during 2001. We four years this investment in product innovation and JUNOS Internet™ software. Our customers have also addressed this fundamentally new edge market has resulted in eight purpose-built platforms and come to depend upon the fundamentally unique with more than three dozen new M-series interfaces, a dozen JUNOS software releases. Our hardware nature of our M-series routers with the Internet including a wide range of channelization and security and software ultimately helps service providers Processor II ASIC™ and JUNOS Internet™ software. offerings. Our growing edge portfolio of more than deploy new premium IP services offerings such as Juniper Networks products deliver proven cost of 100 system interfaces can be easily customized for Virtual Private Networks (VPNs) and performance ownership benefits including simplified operation virtually any provider service offering. The newest capabilities with Multiprotocol Label Switching and consistent features on every platform. The offering for the edge market, Juniper Networks M40e (MPLS)-based class of service, enabling different commitment to our four markets, backbone core, Internet router, gives service providers confidence to service level agreements (SLAs) for disparate edge, cable and mobile Internet networks, includes consistently deliver fault tolerant services in the edge customer applications. market. The M40e, along with five other M-series


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    platforms, are purpose built solutions for edge Scalable business model Trusted partner market requirements. Juniper Networks continues Juniper Networks continues to revolutionize the Juniper Networks successful business align- to focus on delivering edge market needs, including networking industry. Our systems ensure customers ment with our global customer base in 47 countries separate data and control planes, PIC hot swap can profitably deliver backbone core, edge, cable, continues to establish us as a trusted partner. Our and redundant routing engines, switch fabrics, and and mobile Internet services at unprecedented business model supports the intelligent network power and cooling components. scale. The company is actively translating technology requirements of service providers in backbone core, Cable Market innovation into a carrier’s business advantage. Our edge, cable and mobile markets with fundamentally Today’s high-speed cable networks depend on IP four-market approach expands on the underlying new directions of IP system expertise. The unique for simultaneous services including interactive voice, trust that Juniper Networks has delivered since 1996. approach to all four markets ensures that secure, reliable data and entertainment-quality video. In Our alignment with service providers’ business reliable networks leverage a common thread of 2001, Juniper Networks acquired Pacific Broadband models and ongoing service offerings creates lasting powerful network-based intelligence. This intelligence Corporation and now offers the DOCSIS-certified G10 customer relationships. is critical for building scale and functionality in cable modem termination system (CMTS). Pairing service provider networks along with a growing base The doubling of the Juniper Networks this CMTS with our M-series backbone core and edge of high-value and revenue-generating IP services. global customer base during 2001, including global routing platforms allows cable service operators to PTTs, is based on eight distinct world-class product accelerate the upgrade of their offerings from one- offerings and related customer services that are way information channels to two-way entertainment second to none. Using Juniper Networks products and data networking services. This unique combina- and solutions, service providers have been tion helps cable operators quickly transition to IP. efficiently growing networks while providing secure Cable operators leveraging this solution also benefit IP services, all without excessive operational or from the G10’s Broadband Cable Processor ASIC upgrade costs. Juniper Networks business model ability to reclaim underutilized capacity in the cable also minimizes operational costs for service network. Juniper Networks complete IP solution also providers. Carriers and service providers increases cable network bandwidth and decreases appreciate the attention to their total cost of cable operator cost, ultimately extending the life of operation in which network complexity is cable plant networks. In North America, the G10 reduced and capital expenditures on CMTS is sold through Scientific Atlanta, a leading duplicate equipment are lowered. Their supplier of CMTS solutions. enterprise customers reap the benefits Mobile Market as well. This business model meets the Mobile operators are offering a growing range technical and service requirements of of advanced telephony, high-speed data and service providers and their enterprise e-commerce applications. During 2001 Juniper customers—an ideal mix for Networks successfully delivered products for both a mutually profitable the customer-facing edge and backbone core of business partnership. mobile operators networks. For the intelligent edge of 2.5G and 3G services, we jointly developed a revolutionary new product, the J20 GGSN, with Ericsson. This new platform, based on the M20 Internet router, is an order of magnitude superior to legacy offerings, supporting hundreds of thousands of concurrent 2.5G and 3G mobile users on the Internet. Wind and Rogers Cantel are two of the numerous mobile operators already leveraging the J20 GGSN. These mobile customers are also utilizing our purpose-built M-series routing systems for migrating their mobile core and edge networks to IP. Mobile networks are transitioning from legacy ATM and Frame Relay to IP, allowing mobile operators to easily add new services without prohibitive upgrade costs.


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    Juniper Networks Powers IP Solutions in Four Markets Backbone Core A backbone core in the New Public Network is an intelligent IP expressway for a scalable array of networks. Core Market Core customers are service providers and carriers provisioning and deploying scalable IP infrastructure for quickly creating premium IP services. These value-added services are delivered to enterprises, governments, and through regional providers who resell the services. Requirements Growth in the network edge business fuels the need for more core backbone capacity and shared software functionality to enable new IP services. Customers want scalable solutions with a $ Millions common set of features and services to minimize capital expenses $5,000 and reduce operational costs. $4,000 Our Role We help customers quickly create new service revenue with scalable IP core infrastructure solutions and professional services. $3,000 $2,000 $1,000 $0 2001 2002 2003 2004 2005 Core Router Market Opportunity Source: The Dell’Oro Group Edge The edge is where our customers’ users depend upon the New Public Network for value-added IP services. Edge Market Edge customers are service providers and carriers offering a trusted connection to resilient IP services and dedicated access. Requirements Stress on edge and dedicated access infrastructure stems from growth in multi-layer enterprise VPN offerings, consumer broadband connections, and other concurrent class differentiated services, including access from mobile networks. Our customers attract and retain their enterprise clients with more edge capacity, rock-solid $ Millions $3,000 reliability, and more efficient ways to create and support IP services. $2,500 Our Role We help customers create new service revenue with scalable and reliable solutions for dedicated access aggregation, VPNs, robust IP $2,000 security, hosting, and other new differentiated IP services. $1,500 $1,000 $500 $0 2001 2002 2003 2004 2005 NA IP Aggregation Router Market Opportunity Source: RHK


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    Mobile New mobile infrastructure extends IP services to users on 2.5G and 3G wireless networks. Mobile Market We sell IP infrastructure to mobile operators for providing wireless users with scalable Internet services. New services include advanced telephony applications, high-speed video and data access over next-generation wireless networks. Requirements Legacy frame and cell relay networks need IP overlays to scale new, concurrent voice, video or data services on 2.5G and 3G wireless networks. Mobile operators require a new gateway platform—a scalable, wireless Internet router—to interface hundreds of thousands of $ Millions wireless connections with the edge of a mobile network. $2,500 Our Role In addition to our portfolio of core and edge offerings, $2,000 we sell a new wireless routing solution developed in a joint venture with Ericsson. This new platform provides wireless IP solutions with up $1,500 to 100% more performance than legacy gear. $1,000 $500 $0 2001 2002 2003 2004 Mobile Infrastructure Market Opportunity Source: ABN AMRO and Juniper Networks Cable Scalable head-end IP cable infrastructure enables multiple last-mile Internet services. Cable Market Multiservice operators (MSOs) enhance the value of hybrid fiber/coax networks through a unique combination of scalable IP voice, video and data services. Consumer users depend on MSOs to provide scalable access to these IP services through two-way interactive cable modems. Requirements MSOs need to upgrade both the legacy routing and asymmetric cable head-end portions of their network to provision two-way IP services at scale. These cable operators $ Millions $1,500 require infrastructure that efficiently facilitates software control and management of multimedia IP services from multiple service operators over the same network. $1,000 Our Role We provide MSOs with both a high-performance Internet router platform and advanced cable head-end solution. The synergy of these platforms can provision multiple simultaneous IP services to $500 cable modem users. Cable operators leverage vast efficiencies of scale using Juniper Networks solutions to provision service delivery $0 today and tomorrow. 2001 2002 2003 2004 2005 CMTS Head-end Market Opportunity Source: The Gartner Group


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    Fusion Reforms Cost of Japanese Telephony with Juniper Networks Yoshiaki Hirayama A new Japanese service provider is radically Fusion found that overlaying new IP services Since installation, Juniper Networks routers cutting the cost of telephony by sending consumer on a conventional circuit-switched network was have enabled high speech quality in Fusion’s VoIP and business calls over its all-Internet Protocol (IP) inadequate for quality voice service. “We required services. “We haven’t seen any delay at the IP level network and the Internet. Fusion Communications a new technology, a new operating method and and feel certain that the speech quality of our VoIP Corp. sells Japan’s first single rate, 24-hour-per-day, a new partner,” says Yoshiaki Hirayama, general services is almost as high as circuit-based offerings location independent voice service based on IP. manager of Fusion’s Network Engineering Division. from NTT,” says Hirayama. Speech quality rivals the expensive service from “Our construction policy was to focus the All-IP network enables popular services incumbent carriers. Fusion has slashed average network on simplicity,” says Hirayama. “We used To use the VoIP service, users enter a incumbent rates for three-minute calls by approxi- a redundant configuration of Juniper Networks “0038” prefix to regular telephone numbers, which mately 60% for local, 33% for national, and 50% M-series routers to ensure stability and achieve bypasses the incumbents’ networks and routes VoIP to 70% for international calls. a lower cost of ownership.” traffic onto the FUSION-IP Network. Popularity is soaring for this new “ ” A flat rate of 20 yen (about 26 service. Since its debut in April 2001, Our construction policy was to focus the network cents US) per three minutes applies to Fusion attracted a half million subscriber lines within its first six months and more on simplicity. We used a redundant configuration all calls in Japan—an average savings of 33% to 60%. International rates vary, but than 1.3 million lines to date. The Tokyo- of Juniper Networks M-series routers to ensure the average overall savings ranges up to based company bypassed incumbent stability and achieve a lower cost of ownership. 70% for many destinations. providers by building the largest IP network in Japan. The demanding performance and Yoshiaki Hirayama Fusion also provides Internet access General Manager, Network Engineering Division technical requirements for Voice over IP and services, including VPNs for corporate Fusion Communications (VoIP) and other services led Fusion to networks, and data centers for equipment Juniper Networks, which provided all IP routing housing and hosting. “Integrating all voice, data and Juniper Networks software provides infrastructure for this revolutionary New Public video services on one all-IP network from Juniper reliable transmission of multiple Network service offering. Networks has resulted in drastic cost reductions,” IP services says Hirayama. Fusion uses Juniper Networks IP Fusion chose IP routers from Juniper routing technology to challenge Japan’s Networks for scalable performance, reliability, Juniper Networks—A foundation for incumbent telephony providers cost performance, and strong support for an array quality services Until last year, Japanese telephony charges of IP services. A key attraction was software support The foundation of Fusion’s service quality is always became more expensive as calling distance for Multiprotocol Label Switching (MPLS), used to its IP router infrastructure from Juniper Networks. grew. Fusion Communications devised a strategy to control simultaneous traffic flow of multiple services “I believe Juniper Networks products deliver quality avoid the incumbents’ overhead of building and such as VoIP and Virtual Private Networks (VPNs). beyond what was originally expected,” Hirayama says. maintaining costly separate infrastructures for “No other routing systems came close to matching From an operational perspective, Hirayama voice, data, Internet access, and other services. the capabilities offered by Juniper Networks,” says Fusion has not encountered any performance To implement this strategy, Fusion built a single says Hirayama. or scaling issues since installation—reducing the IP network as a foundation for multiple services, Fusion bought and deployed a redundant cost of operations. “For Fusion, Juniper Networks thereby reducing costs of capital expenditures, mesh configuration of Juniper Networks M20 offers an ideal solution,” says Hirayama. network management, and operations. In turn, and M10 Internet routers. A pair of routers was Fusion passes these savings to their customers. configured for IP edge and access services in each of Fusion’s 18 access points in Japan.


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    Accelerating Delivery of IP Services with Juniper David Garbin Networks Cable & Wireless PLC is a global business capacity needs,” says David A. Garbin, senior director “Juniper Networks JUNOS Internet software is telecommunications provider with customers in of Strategic Network Planning for Cable & Wireless. stable and highly reliable, and that stability with a 70 countries. The company offers best-in-class common feature set across all Juniper Networks Juniper Networks provides technology for premium IP services on one IP network. Cable & platforms is a benefit.” scaling IP services and high-speed access Wireless built their global edge and core network To support high-speed edge aggregation of Cable & Wireless engineers say that Juniper infrastructure with Juniper Networks IP routers. OC-48 customer connections, Garbin says Cable & Networks gear always meets full specifications The acceleration of growth needs for access Wireless needed additional network capacity and under lab tests. “This is Juniper Networks best-in- and IP services, especially from large enterprise implemented Multiprotocol Label Switching (MPLS) class reputation around the industry,” says Garbin. customers at the network edge, triggered new functionality found in JUNOS Internet software. A Garbin also says his team appreciates access technical requirements for Cable & Wireless. High- core capacity of OC-192, or 10-gigabits-per-second to Juniper Networks developers and engineers. speed aggregation of faster leased-line connections (Gbps), was required to simultaneously trunk up to “Juniper Networks reaction to any of our issues is was a big priority. The company also sought to four 2.5 Gbps OC-48 access connections. “We always very supportive and quick.” provision large-scale secure IP service offerings found JUNOS software to be essential for traffic such as VPNs. Innovative software from Juniper Networks engineering and ensuring scalable quality of service underpins new generation of IP services Based on the strength of leading- across our global network,” says Garbin. For Cable & Wireless, using MPLS edge technology, and a deep engineering “ ” in core and edge routers from Juniper relationship between both companies, The idea of network-based service creation is Networks reflects a shift into the network Cable & Wireless again turned to Juniper of routing intelligence from customer Networks for IP routing and customer taking off with services providers and our enterprise premises equipment. It also underpins a service solutions supporting new customers who are looking to optimize their own new generation of intelligent IP services business growth. cost of ownership and network operations. sought especially by global enterprises. Meeting customer demand for “The idea of network-based service new edge services David Garbin Senior Director creation is taking off with service providers During the past few years, Cable & Strategic Network Planning and our enterprise customers who are Cable & Wireless Wireless has gradually shifted service looking to optimize their own cost of emphasis to global enterprises, large Following evaluations and testing, Cable & ownership and network operations,” says Garbin. content providers, and large Internet service Wireless installed 18 Juniper Networks M160 Collaboration between Cable & Wireless and providers. Implementation of the new strategy Internet routers at seven network nodes in New York, Juniper Networks is resulting in important new serv- included a move from using multiple legacy, Washington, D.C., and Europe. The company plans ices such as high-speed encrypted IP connectivity circuit-based networks to provisioning all core to install additional routers in five more U.S. nodes and granular bandwidth services scaling from and edge services with one global IP-based net- in 2002. extremely high-speed, quality of service offerings to work. The new strategy allows Cable & Wireless to offer a variety of premium IP services with lower Engineers cite quality and reliability for low-speed dedicated access links. “Juniper operating and support costs. Juniper Networks solutions Networks is helping us provide new, differentiated services at the edge,” says Garbin. “The company Growth in demand for edge services is trigger- Quality and reliability were another big factor really participates with us when we’re brainstorming ing new requirements for their network infrastructure. cited for why Cable & Wireless continues to trust its needs for future capabilities.” “Our customers are coming to us with increasingly business to Juniper Networks. “Software stability is, high-speed connections, which drives our own in general, our biggest concern,” Garbin says.


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    ForgingEdge a Scalable and Core Network with Juniper Networks Ned Hayes DIRECTV Broadband, Inc. is the national Broadband sought a new, more reliable IP network The POP-by-POP installation process residential broadband counterpart to the DIRECTV that would scale without requiring another “forklift” took about three months. “We leveraged Juniper digital entertainment satellite transmission service upgrade. “Our goal was to assemble a new network Networks Professional Services group to help our owned by Hughes Electronics Corporation, and its with a trusted vendor and a proven quality of service team implement the nationwide network,” says parent, General Motors Corporation. DIRECTV to scale to millions of subscribers,” says Ned Hayes, Sandor. The combined team replaced legacy Broadband, formerly known as Telocity, provides president and CEO of DIRECTV Broadband. That was equipment and software in real-time. customers with a one-stop shop of integrated when the company turned to Juniper Networks. “That was a major coup to overhaul the terrestrial broadband services for the home. The Juniper Networks technology and network in a way that had little effect, other than company serves more than 91,000 residential services provide smooth upgrade of better performance for the user base,” he says. customers throughout the United States. a live core network Juniper Networks provides rock-solid As a prelude to serving a new market of The push for using Juniper Networks started stability for DIRECTV Broadband millions of customers, DIRECTV Broadband last with DIRECTV Broadband’s engineers. “All of our network users year replaced its core and edge aggregation engineers were clamoring to work with Juniper Since implementing the new IP network network routers with equipment and software from Networks because of its products and reputation,” with Juniper Networks, DIRECTV Broadband is Juniper Networks. The new technology platform Sandor says. “They want to work with the hottest pleased with the system performance. “My number enables DIRECTV Broadband to expand business and best products in the marketplace because it one concern used to be network stability,” says operations by many orders of magnitude without guarantees their success going forward.” Sandor. “With Juniper Networks, it has disappeared making substantial future upgrades or causing off my radar screen.” “ ” service disruptions. Our goal was to assemble a new network with a “Our successful network upgrade with Juniper Networks products prepare DIRECTV Broadband trusted vendor and a proven quality of service to Juniper Networks is a major accomplishment and gives us good confidence as we move to for rapid growth scale to millions of subscribers. millions of users that we’ve made the right DIRECTV is the leading digital Ned Hayes decision,” adds Hayes. entertainment satellite transmission President and CEO service with more than 10.7 million DIRECTV Broadband The new solutions from Juniper subscribers. HUGHES decided to create Networks enable rapid addition of new a companion two-way terrestrial network for an The engineering team did a rigorous two- capacity simply by swapping modular interface array of new IP-based entertainment, voice month competitive evaluation in the company’s cards in the router platforms. Quality of service and data services using Digital Subscriber Line interoperability lab. “Juniper Networks flew through technology in Juniper Networks software and (DSL) technology. the evaluation,” says Sandor. “We were very pleased hardware also supports DIRECTV Broadband and with the performance.” its strategy to deliver differentiated IP services HUGHES purchased Telocity in 2001, and as such as voice, unified messaging, content filtering, a quick start for the company, renamed it DIRECTV DIRECTV Broadband purchased 26 Juniper and in the near future, streaming audio and video. Broadband and rebranded its service as DIRECTV Networks M160 Internet routers and several M5 DSL™. The acquired network infrastructure needed a Internet routers for network peering. DIRECTV “We believe our new network’s ability to substantial overhaul to meet quality requirements for Broadband is using the M160 routers for high- process information will take us to the new level of the company’s customer subscription growth plans. speed network routing between its 13 points of serving a large subscriber base without any major presence (POPs) in major U.S. metropolitan areas. changes,” Hayes says. “The old network equipment was unreliable,” says Bob Sandor, senior vice president of operations for DIRECTV Broadband. DIRECTV


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    IntelliSpace Builds Better Breed of Broadband with Juniper Jeff Allen Networks IntelliSpace is a leader in the growing metro- IntelliSpace. “We found that by using Juniper based on its support for Multiprotocol Label politan services market. Started in 1995, the New Networks, we can introduce multiple new IP- Switching (MPLS). “MPLS is the means to creating a York-based metropolitan data services provider was based services at scale without having to buy new class of VPN services based on predetermined the first Ethernet IP broadband services company new equipment.” service levels.” to focus on last-mile solutions for medium and Juniper Networks provides flexible Some of the premium IP services offered by large businesses. IntelliSpace provides dedicated aggregation for dedicated access services IntelliSpace include bandwidth-on-demand, VPNs, broadband access services ranging from 64 Kbps Lalomia says the company evaluated network transparent LAN services and storage area network- to 10 Gbps, and premium IP services. It serves infrastructure options based on reliability, flexibility, ing. The company is planning to use MPLS for other more than 75,000 business users in over 200 and then price. An important issue in Juniper premium IP services, including Gigabit Ethernet for communities in the U.S. and Europe. Networks favor was solution density. network-attached storage, defining quality of service IntelliSpace differentiates services for electronic communications network content, “ ” from other broadband metropolitan Juniper Networks enabled our business to grow and regional networking applications such as services players with an agnostic medical imaging. approach to network access. Its pragmat- into new services without forklift upgrades and Ensuring a better breed of ic strategy is to show customers how to paying more capital. broadband with Juniper Networks use their existing network infrastructure Jeff Allen technology for metropolitan broadband today and President and CEO IntelliSpace IntelliSpace’s hybrid approach to help customers adopt more modern using fiber and traditional links with Juniper infrastructure as it becomes available. Networks technology allows the company IntelliSpace tapped Juniper Networks to “Density was a huge issue for us,” says to address 100% of the market all of the time. implement its strategy with an all-IP network Lalomia. “Essentially, we wanted to simplify network Marquee enterprise customers include JP Morgan, infrastructure that simplifies network operations design and put as many wide area network interfaces Merck, and the National Basketball Association. and stabilizes the company’s capital costs. as possible into one box without compromising IntelliSpace also provides broadband over optical A practical approach to metro broadband performance and stability.” links to more than 1,000 large commercial For practical reasons, the new IntelliSpace buildings, including Rockefeller Center, Lincoln Toward that end, IntelliSpace purchased 20 infrastructure had to accommodate a range of Center, and the Chicago Board of Options Exchange. Juniper Networks M40 Internet routers. DS-3 inter- legacy and next generation IP network interfaces. face aggregation provided by the M40 router is an “We have had no problems with Juniper “Fiber is the optimum broadband transmis- important function for IntelliSpace, which creates Networks,” says Lalomia. “Juniper Networks has sion medium,” says Jeff Allen, president and chief clear channel DS-3s by aggregating Channelized proven itself to be a carrier-class provider.” executive officer of IntelliSpace. “But in the real OC-12, DS-3, and Gigabit Ethernet into M40 routers. Together with Juniper Networks, IntelliSpace world, it’s more common to encounter traditional “The high density in Juniper Networks routers is leading the way to provide a better breed of links such as T1, DS-3, OC-3 and OC-12, including gives us better return on capital because we do not broadband and broadband services. “Juniper channelized options.” have any unused ports,” says Lalomia. Networks enabled our business to grow into new To provide flexible support for a variety of services without forklift upgrades and paying more JUNOS Internet software enables new networking technologies and IP services, IntelliSpace capital,” says Allen. IntelliSpace IP services specified one all-IP network infrastructure. “We According to Lalomia, the JUNOS Internet required a solution that scaled routing intelligence software that powers the M40 router also includes a from the core to the edge of the network,” says Carlo crucial foundation for new IntelliSpace services, Lalomia, chief technology officer and co-founder of


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    Corporate Officers and Directors Officers Directors Scott Kriens Marcel Gani William R. Hearst, III Chairman, President, and Chief Financial Officer Kleiner, Perkins, Caufield & Byers Chief Executive Officer Christopher J. Hurst Vinod Khosla Pradeep Sindhu Vice President of Worldwide Sales and Service Kleiner, Perkins, Caufield & Byers Vice Chairman, Chief Technical Officer, and Founder Askok Krishnamurthi C. Richard Kramlich Vice President of Hardware Engineering New Enterprise Associates Steve Ames Vice President of Software Engineering Ray Martinelli Stratton Sclavos Vice President of Human Resources VeriSign, Inc. Lisa C. Berry Vice President, General Counsel, Kim Perdikou William R. Stensrud and Secretary Chief Information Officer Enterprise Partners Jody Bisson Alok Sharma Vice President of Finance Vice President of Cable Business Lloyd Carney Carl Showalter Chief Operating Officer Vice President of Marketing Michael Dodd Robert Sturgeon Vice President of Operations Vice President of Worldwide Customer Service and Support Randi Paikoff Feigin Vice President of Investor Relations Peter Wexler Vice President of Mobile Business Joe Furgerson Vice President of Corporate Strategy Corporate and Investor Information Corporate Headquarters Transfer Agent Juniper Networks, Inc. The transfer agent and registrar for the common stock is Wells Fargo 1194 North Mathilda Avenue Shareowner Services, 800.468.9716 Sunnyvale, California 94089 408.745.2000 Legal Counsel Wilson Sonsini Goodrich & Rosati Investor Relations Palo Alto, California For further information on the company, including the Form 10-K, please visit www.juniper.net/company/investors/. Auditors Ernst & Young LLP Stock Listing Palo Alto, California Juniper Networks common stock is quoted on the Nasdaq National Market under the symbol JNPR. Copyright © 2002, Juniper Networks, Inc. All rights reserved. Juniper Networks is registered in the U.S. Patent and Trademark Office and in other countries as a trademark of Juniper Networks, Inc. Broadband Cable Processor, G10, Internet Processor, Internet Processor II, JUNOS, JUNOScript, M5, M10, M20, M40, M40e, and M160 are trademarks of Juniper Networks, Inc. All other trademarks, service marks, registered trademarks, or registered service marks are the property of their respective owners. All specifications are subject to change without notice. Juniper Networks assumes no responsibility for any inaccuracies in this document. Juniper Networks reserves the right to change, modify, transfer, or otherwise revise this publication without notice.


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    www.juniper.net Headquarters Europe, Middle East and Africa Asia Pacific 1194 North Mathilda Avenue Juniper Networks Ltd. Juniper Networks (Hong Kong) Ltd. Sunnyvale, California 94089 Airside Business Park Suite 1601-06, Natwest Tower U.S.A. Swords, Co. Times Square, 1 Matheson Street 408.745.2000 Dublin, Ireland Causeway Bay, Hong Kong +44.0.1372.385500 (U.K.) 852.2332.3636 353001-001 3/02


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