The CRS-1 product, which took four years to develop at a total cost of $500 million, is designed for ultra high-end service providers and reaches a routing capacity of up to 92 terabits per second. Cisco developed brand-new software for the product as well. Analysts said the new enterprise routers could have more of an immediate impact on the company than the much hyped CRS-1 announcement. "The CRS-1 gets Cisco into a new super high-end router market," said Zeus Kerravala, an analyst with The Yankee Group. "Cisco's enterprise routers are the cornerstone of their business. Introducing new products in this category is more about maintaining their dominance.".

The market for the CRS-1, which is targeted at high-end service providers, is roughly $750 million to $800 million per year, according to Stephen Kamman, an equities analyst with CIBC World Markets, By contrast, the market for low-end branch office routers, such as the 1700, 2600 and 3700 models, is about $2 billion to $2.5 billion per year, he said, Kamman estimated that Cisco will bring in solar system iphone case roughly $5.3 billion in total router revenue in 2004, All told, the branch office router market makes up roughly 40 percent of Cisco's overall router sales, he said..

"This is a really healthy market for Cisco," Kamman said. "They are making a significant amount of revenue here, and they've got pretty good profit margins. It's really important for them to stay ahead of the curve to keep their lead.". Cisco is bracing for one of its biggest threats in this market in years next week, when Juniper is expected to unveil its first enterprise router products. Juniper's entrance into the corporate market is a shift in the company's overall product strategy. Since its inception in 1997, Juniper has targeted the Internet service provider and telephone carrier markets. The strategy has worked well for the company. It now represents about 30 percent of all router sales in this market every quarter. It has carved out this niche at the expense of Cisco, which for the most part owns the other 70 percent of the market.

In February, Juniper took the first step in changing this service provider-focused strategy with the acquisition of VPN and firewall maker NetScreen Technologies, Since then, Juniper has publicly stated that it plans to enter the enterprise market, Asked about the expected release next week, a Juniper representative declined solar system iphone case to comment, While most analysts agree that Juniper's products will likely be looked at closely by corporate customers, they are by no means a shoe-in as a second supplier to Cisco, Juniper still has several hurdles to get over before it can challenge Cisco in a significant way..

For one, the first release of the new Juniper routers will not have security features from NetScreen integrated into them. Conover said he wouldn't expect the NetScreen features to be added into the product for at least another six to 12 months. This is a strike against Juniper considering that Cisco is making security features standard on its new routers expected out by the end of the summer. "Routing requirements for the enterprise are so different from the service provider market," Conover said. "For Juniper, it's like going back to the drawing board. But because their software is stable, customers can be assured it won't crash.".