Cisco and Juniper are the major providers ofthat's based on the Internet Protocol (IP), which lets carriers build a single network capable of offering voice calls, video and broadband. It's a more cost-effective method than the separate networks carriers now need to offer each service. The technological shift to IP also lets phone companies create and sell more of their own offerings, including secure Virtual Private Networks (VPN).
On Monday, Cisco announced two more major contract wins. Both Verizon Communications, the No. 1 U.S. phone company, and Asian giant China Netcom will be supplied with Cisco IP-based gear. This marks Cisco's fifth major contract win in the last 18 months, Cisco noted in its announcement: "The market is moving toward Cisco?s core expertise, IP or data?which mean(s) they are headed right in Cisco?s direction."
But rivals, chief among them Juniper Networks, say their products are benefiting just as much by the industry shift. In fact, during the last six financial quarters, Juniper Networks increased its share of the IP-based telephone network equipment market from 17 percent to 35 percent, according to Paula Reinman, Juniper's corporate communications director. That came partly at the expense of Cisco Systems' market-leading share of about 64 percent.
"It's their job to spin the story, but it's just simply not true," she said. "It's a two-horse race."
A Cisco Systems spokesman declined comment on whether Cisco has been losing any market share to rivals.
Analysts say Cisco will likely dominate the market for a long time but that there will be times when it might suffer setbacks.
"People will leapfrog each other with different capabilities, and Cisco might be leapfrogged by somebody right now," said Deb Mielke, an analyst with consultants Treilliage Network Strategies. "But it's not likely to stay that way for long."