When the Chinese AI company DeepSeek shocked markets by releasing its R1 model, President Donald Trump called it “a wakeup call for our industries that we need to be laser-focused on competing to win.” And competing to win means American companies need a fighting chance in the global marketplace.
But before Mr. Trump’s nominees to lead the Department of Justice even received their confirmation from the Senate and could start work, the DOJ sued to block Hewlett Packard Enterprise Co. from acquiring Juniper Networks Inc. The merger offers compelling synergies that will create a robust, AI-driven, cloud-native networking portfolio that will match the evolving connectivity needs of businesses – and directly take on competition from China.
In a statement, HPE and Juniper blasted the “fundamentally flawed” lawsuit and said the companies will prove how the merger “will provide customers with greater innovation and choice, positively change the dynamics in the networking market by enhancing competition, and strengthen the backbone of U.S. networking infrastructure.”
The DOJ’s complaint alleged the acquisition would mean the two combined companies, together with their largest competitor, Cisco Systems, would control “well over 70 percent of the U.S. market and eliminate fierce head-to-head competition” between HPE and Juniper, who “offer wireless networking solutions under the HPE Aruba and Juniper Mist brands.”
However, the complaint downplayed not only Cisco but also another important player: China’s Huawei. DOJ noted that Huawei and other foreign companies “have been identified as potential security threats by the U.S. government and, under federal law, are barred from competing for business domestically.”
But competition is global. Tele.net reported Q3 revenue market share worldwide, with Cisco at 41.6 percent, HPE 15.1 percent, Ubiquiti (also American) 8.3 percent, Huawei 7.2 percent, and Juniper 5.3 percent.
Here’s the problem. Huawei is “taking on networking competitors Cisco and HPE in Europe, Middle East and Africa (EMEA), Asia Pacific excluding China, as well as in Latin America,” according to an analysis by Dell’Oro Group. For Campus Local Area Networks, larger LANs connecting buildings, EMEA produces the second highest global revenues after North America, with Huawei and HPE the top two and running even at about 14 percent each.
Even worse, “Huawei is poised to pounce” if the AI revolution causes HPE and other American players “to lose focus on their network equipment markets outside North America,” Dell’Oro reported. The good news: The HPE-Juniper merger “may eventually make HPE a more formidable competitor to Huawei.” The key is the AI prowess of Juniper’s Mist would boost HPE’s global market share against Huawei. If the DOJ lawsuit succeeds in blocking the merger, Huawei could gain an insurmountable global advantage.
Last June, the UK’s Competition and Market Authority cleared the merger. Then the European Commission approved the merger “unconditionally” because the two companies “are not each other’s closest competitors” and the combined company would face stiff competition.
Reuters reported the walk-away date for the merger is in October, and legal wrangling could throttle the deal before then. Legal costs will easily run into the millions—money needed for R&D to face off against Huawei. And both companies would face an uncertain future, clouding their R&D decisions.
In addition to Huawei’s products compromising national security when used here, there’s another security threat: American businesses getting mired in needless legal disputes and falling behind in critical services they provide to our military and other parts of our national defense apparatus.
Gail Slater, a tech industry veteran and economic adviser to Vice President JD Vance, will soon go before the Senate Judiciary Committee for her confirmation as Mr. Trump’s nominee to lead the DOJ’s antitrust division. “Gail will help ensure that our competition laws are enforced,” Mr. Trump wrote on TruthSocial, “both vigorously and FAIRLY, with clear rules that facilitate, rather than stifle, the ingenuity of our greatest companies.” The all-caps emphasis on “FAIRLY,” of course, is Mr. Trump’s.
“Congratulations Gail,” he concluded. “Together, we will Make America Competitive Again!”
That’s the key. Our great country is in a life-and-death struggle with China. To stay on top, we need to let our best tech companies pursue market-driven solutions to compete globally, rather than having their business decisions made by a judge in a California courtroom over months or even years.
Let’s hope that Ms. Slater, after her confirmation, takes a close look at this merger, sees that it’s vital for both American consumers and our national security, and makes the right choice by dropping the lawsuit and letting the deal proceed.
Gayle Trotter is a lawyer and political commentator in Washington. Her views are her own. Follow her on X @GayleTrotter or at gayletrotter.com
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