Juniper Networks is taking a significant position in the growing data center interconnect (DCI) market with its acquisition, announced Tuesday, of packet optical vendor BTI Systems.

Juniper Networks Inc. (NYSE: JNPR) hopes the acquisition -- financial terms for which were not disclosed -- will further sweeten its attractiveness to content, cloud and communications service providers that need network technology designed specifically to transport large volumes of traffic between data centers in a secure and efficient way.

"This is big for Juniper in getting a bigger piece of a hot market -- data center interconnect -- with a proven winner in that segment," Heavy Reading analyst Dan O'Shea said in an email today.

Juniper said in a statement, "We expect the acquisition will allow Juniper to accelerate the delivery of open and automated packet optical transport solutions that integrate with our NorthStar Controller and include network management features that enable end-to-end provisioning of new services."

Juniper plans to integrate BTI Systems Inc. 's packet optical systems with its own switching and IP routing strength, which CEO Rami Rahim discussed with Light Reading in an exclusive video interview in mid-2015. (See CEO Chat With Rami Rahim, Juniper.)

Juniper says it expects the acquisition will close in the second quarter and that it will share further information at that point.

BTI sees its future in the cloud and has customized its products for that market, with high-speed optical capabilities that are very compact and high density as well as SDN and NFV capabilities well suited for cloud deployments.

BTI Guy BTI CEO Colin Doherty

BTI's Intelligent Cloud Connect platform combines MPLS core routing with optical transport and is designed to help operators reduce costs, bolster efficiency and enhance agility -- key goals for operators looking to make the transition to New IP networks. It's interoperable with equipment from Cisco Systems Inc. (Nasdaq: CSCO), Ericsson AB (Nasdaq: ERIC), ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763) and other leading vendors. BTI claims its customers can reduce total cost of ownership and capital expenditures by more than 70% by using a single platform instead of separate MPLS core routing and optical transport systems.

The data center interconnect market -- a key driver for the acquisition -- is smoking hot, with Ovum estimating sales growing from $2.5 billion in 2014 to more than $4.2 billion in 2019. (See Coriant Lights Up the DCI Market.)

As enterprises rely on the cloud for mission-critical applications, they demand beefed-up DCI from service providers, who need equipment, software and services from vendors to fill that need. Emerging Internet of Things and M2M communications make DCI all the more critical. With the BTI acquisition, Juniper hopes to meet that demand. (See Data Center Interconnects in Desperate Need of SDN – AlcaLu .)

And DCI goes beyond metro for long-haul connectivity as well, notes O'Shea. (See DCI Boxes Aren't Just for Metros Anymore.)

The acquisition enhances Juniper's competitive position against major comms suppliers, including Cisco/Ericsson, Nokia (including the recently acquired Alcatel-Lucent (NYSE: ALU) business unit) and Huawei Technologies Co. Ltd. , as well as ADVA, Infinera and Ciena. (See Ciena Surfs DCI Wave With New Platform, Infinera Ups DCI to 100 Gigabit Ethernet, Cisco Introduces Software for Cloud-Scale Networking and Infinera, Arista Publish Data Center Interconnect Test Results.)

BTI has about 380 customers, including Equinix Inc. (Nasdaq: EQIX), Rackspace , Interxion, CyrusOne, Pacnet , IPC and VKontakte, and has raised about $60 million in growth funding since 2011. (See CyrusOne Sticks With BTI for DCI.)

BTI won the Light Reading Leading Lights Company of the Year (Private) award last year. (See Leading Lights Awards 2015: The Winners and Leading Lights Finalists 2015: Company of the Year (Private).)

BTI has been on a multi-year transition from competing on speeds and feeds to flexibility and usability, building a software- and application-ready platform, CEO Colin Doherty said in an April 2015 interview with Light Reading CEO Steve Saunders. (See CEO Chat With Colin Doherty, BTI Systems.)

"BTI has long been rumored as an IPO candidate," O'Shea says. "Sort of a small but successful fish in a big pond... essentially having had early success supporting data center interconnection for web and content companies before other vendors even saw the opportunity."

He adds, "But now all their competitors have that capability, so this seems like a natural move to get with [Juniper,] a bigger player with more resources and better reach."

This isn't Doherty's first acquisition, O'Shea notes. Before joining BTI as CEO in 2014, Doherty was CEO of Arbor Networks and guided its acquisition by Danaher in 2010, followed by Arbor's acquisition of Packetloop. (See BTI Names Former Arbor Boss as CEO.)

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— Mitch Wagner, , West Coast Bureau Chief, Light Reading. Got a tip about SDN or NFV? Send it to [email protected]