Kathy Durr, Vice President, Investor Relations Scott Kriens, Chairman & CEO Rob Dykes, CFO & Executive Vice President of Business Operations.

Samuel Wilson, JMP Securities Alex Henderson, Citigroup Christin Armacost, SG. Cowen & Co., Lucas Gwenky Jeff Evanson, Sanford Bernstein Gina Sockolow, Buckingham Research John Zhou, Lehman Brothers Shah Wu, American Technology Research Mark Sue, RBC capital markets Natarajan Subrahmanyan, Sanders Morris Scott Coleman, Morgan Stanley Stephen Kamman, CIBC Ehud Gelblum, J.P. Morgan Nikos Theodosopoulos, UBS

Thank you and good afternoon everyone and thank you for joining us this afternoon. If you have not seen press release it can be retrieved off of www.juniper.net or First Call or Business Wire. With me today is Scott Kriens, our Chairman CEO; and Rob Dykes, our CFO and Executive Vice President of Business Operations. Today Scott will begin by reviewing Juniper’s fourth quarter and the full year 2005 performance. He will then spend the remainder of his time outlining how we will use our accomplishments in 2005 to leverage our success into 2006 given the current market trends as it relates to our long-term strategy. Following Scott’s comments Rob will review the detail financial results for the fourth quarter and full year ending December 31st 2005 as well as outlining our financial goals. We will then open the call up for questions. Before I turn call over to Scott, I’d like to remind you that the matters we will be discussing today may include forward-looking statements and as such are subject to the risks and uncertainties that could cause actual results to differ from those contained in the forward-looking statements, including those risks and uncertainties discussed in our most recent 10-Q filings with the SEC. We are also presenting some non-GAAP financial information. A reconciliation of GAAP to non-GAAP items can be found on our Investor Relations web page. Juniper Networks assumes no obligation and does not intended update forward-looking statements made on this call. Scott, over to you? Scott Kriens, Chairman, CEO: Thanks Randy and Happy New Year to everyone. Today I’ll be talking briefly about the fourth quarter and the full year performance for 2005 and then I’d like to spend the majority of my time focusing on how we can leverage the accomplishments in 2006 and beyond. Last quarter I spoke about the foundation we built and as I look back not only across the last year but over the last 10 years as we approach the celebrations of our 10 year anniversary next week actually. There have been tremendous accomplishments and successes to mark our progress and we are going to continue to leverage these experiences based on the trends that we see in 2006 and beyond. So firstly the results. We had another solid quarter, our 14th consecutive quarter of growth and as you’ll once again see this is reflected in the metrics we’ll review today. Revenues, earnings, cash, customers and market share all grew as we continue to outperform in all of our target market. Total revenue for the quarter was $575.5 million, up over 5% from last quarter and fully diluted non-GAAP earnings per share was $0.20 up from $0.19 last quarter. GAAP EPS for the fourth quarter was $0.17 compared to $0.14 last quarter and GAAP EPS for 2005 was $0.59 versus $0.25 last year. And please see the press release on our website for the reconciliation of non-GAAP to GAAP results. These results are reflection of our direct sales efforts as well as the contribution of our key strategy partners and resellers. And as we look across the full year I’d like to share both our strategy with regards to our partners as well as some numbers, which represent our success in delivering results in support of that strategy. We believe in open standards, and using partnerships to broaden our reach and best serve the evolving requirements of our customers and as many of you know we have a number of key strategy partners including Ericsson, Lucent, Siemens and NEC in Asia. And in addition we announced this morning a formal agreement with our new strategic partner Avaya to deliver secure converged communication solutions to enterprise customers worldwide. These partners has been instrumental in building relationships with our customers and we remain very excited about the strength of these partnerships as we enter 2006. This side-by-side approach with its support of open standards continues to be well received in contrast with end-to-end proprietary alternatives. And it is also important to understand that with our high touch model each and every customer has a Juniper representative who is responsible for direct contact with them as we sell side by with our strategic partners. In total the revenue generated from these four strategic partners grew almost 40% from 2004 to 2005, more specifically the full year growth rate for Ericsson, Lucent, Siemens and NEC were approximately 57, 32, 44 and over 100% respectively, and Siemens contributed greater than 10% of total revenue during the fourth quarter as well as for the full year of 2005. We are also pleased with the product balance across our business. For Q4 the infrastructure products represented 77% of total product revenue while service layer technology products represented 23% of total product revenue during the quarter. From a geographic perspective last quarter, we saw a strong growth in the Americas and Europe including developing markets in Latin America, Middle East and Eastern Europe in areas like Bulgaria and Russia among others. However, we saw a softness in Asia specifically within Japan due to a pause in the build out of its next generation networks or NGN as decisions are contemplated at many of the major carriers and the market prepares for the next wave of bandwidth and services expansion. This is a very exciting time in Japan we will talk more about in just a few minutes. Finally for the quarter we invested in both the market and product development areas announced several new products during the quarter, we are once again recognized as a leader by the industry analysts and realize significant accomplishment in expanding our broader channel presence. So for a quick look back across the full year of 2005, I would like to point to some numbers and some highlights, which has helped our growth, and extend our success. We grew total revenue to over $2 billion, up over 54% from 2004 and nearly tripled the revenue of only two years ago. This is a major milestone and accomplishment for the company. Fully diluted non-GAAP earnings per share was $0.72, up 64% from $0.44 last year and more than a four-fold increase from two years ago. We are generating cash from operations of almost two-thirds of a billion dollars per year ending 2005 with over $2 billion in total cash and investments. Currently the business generates approximately $2.5 million of cash from operations every business day. In the marketplace, we again grew significantly faster than our competitors year-over-year, allowing us to further establish our brand and gain market share in various segments of the market. As an example we were the leaders in Gartner’s Magic Quadrant in all four areas: Firewall, IPSec VPN, SSL VPN and IPS: our Intrusion Prevention Systems, and we are in the No.2 slot in the high-end enterprise router market according to Synergy Research Group, up from 0 in 2004. And in addition we maintain the No.2 position in the service provider EDGE routing category and have done so for more than 13 consecutive quarters according again to Synergy Research Group. And we did all that by expanding our market presence globally and are now doing business in more than 75 countries around the world. We expanded the breath of the channel, growing our sales through the distribution channel by approximately 160% and the number of quality channel partners to over 6000. One example of this success is Ingram Micro, a major distributor of Juniper Solutions whose business now makes them our third largest partner. And we did all of this by staying true to our mantra, which is “Focus”. In the words of our customers we did what we said we would do and this is what the company and Juniper brand is known for in the market making and meeting commitments. We introduce thousands of new software features and a number of major releases throughout the year across several best-in-class platforms including the Multichat, ETX, Matrix and the E320 broadband services router and our infrastructure portfolio. And our security portfolio we introduced the ISG 2000, the SA 6000 and many other products as well as the unified access control, which is an industry leading open standards architecture that helps protect customers existing investments by providing security to the networks and the equipments that has already been bought. And in addition we continue to invest in innovation and we’ll do so again 2006. In 2005 we spent over $300 million in research and development for the ramp of new product cycles, which you’ll see delivered over the next 12 months and we will spend over $400 million in 2006 to both meet our customer requirements and to further extend our lead in the market. So all of that innovation is pointed at some major trends in the marketplace. So let us talk about some of these trends that we see as we enter 2006. From a customer perspective, the network requirements are converging along with the networks primarily along three types of users. There are the traditional carriers, who are now expanding from their stronghold in the physical network with direct access to the subscribers to the delivery of network services for those subscribers in the form of triple and quadruple play capabilities in voice, data, video and wireless. And secondly, there is a new age providers: Goggle, Yahoo, and others who battle for command to the website and the home page preferences from which the user will launch his enquiry into the network for both personal and entertainment needs. And then thirdly, we see the business of our enterprise network customers now more than ever running with an increasing dependency on that network to connect to employees, customers, suppliers and partners in a more sophisticated model of virtual costs and benefits. Among the traditional carriers there’s a wave of next generation network planning, as the migration for multiple standalone legacy networks to a single converged infrastructure accelerates. And I mentioned a slowdown in Japan earlier, this is why we’re seeing the major service providers in Japan who are some of the most aggressive builders of fiber from the network infrastructure all the way out to the home, experience the greatest needs to plan for the next generation of capacity, performance and reliability as they serve an increasingly network literate user population who demands the latest services. And there’s much to be learned here as we believe Japan will set an example of what is and will increasing be happening in other countries of the world as they grow. The second wave of build out will be lumpy but it is enormously important strategically, as it will unlock a level of scale and performance that will fuel creativity and expansion of the entertainment and services offered in years to come. Other examples of these kinds of decision include China Telecom in Asia, the Files project at Verizon and the BT 21C network currently underway in the UK. 2006 will be a year of decisions, planning and some rollout as carriers around the world are in various stages of growth and acceptance by their subscribers. And these decisions will also fuel the continued expansion of broadband wireless and mobility both in the area of DSL and cable, cellular as well as WiFi and will see the continued confirmation that there is only one single infrastructure built around IP, which will support these access technologies as last mile solutions connected to a single network. Obviously this also has implications for the traffic and user profiles on these networks as well. We saw online shoppers spend over $30 billion in this just completed holidays season, which is an increase of 30% this year over last on a very large number, and Ovum has a consulting house that surveys trends, predicts that within the next 10 years the majority of all holidays shopping will be shifted online. There are more than three million songs a day being downloaded from iTunes and more than 8 million videos have been downloaded from that site in the last three months alone. And the growth of use at sites like Goggle and eBay speaks for itself. In the enterprise market, requirements are moving closer to those of traditional service providers everyday: banks, governments, retailers and other businesses large and small demand the same, always on reliability and simultaneous high performance and security as was once reserved for the larger service providers, and this is being delivered through MPLS and other technologies exactly as it is being designed for the service provider. And this consistency is seen as a huge benefit for Juniper in the competitive assessments that are being done today. Security continues to evolve both as a sophisticated requirements in an enterprise network and as a service provided to enterprises through the managed service offerings of the carriers. Application performance and network requirement to ensure the user experiences protected as business processes move online is more strategic than ever, and our capabilities in both website and wide area optimization are big differentiators for Juniper in the marketplace. All these demands are being placed on the network with the expectations that multiple services: voice, data and video will seamlessly and intelligently be supported transparently to users. With expectations are that they will simply click and the device in their hands will respond as needed. And this is easy to say but harder to do and even harder still to do it with the operational simplicity that’s required to scale reliably. So if we couple our accomplishments in 2005 with the trends that we see moving into 2006 what then Juniper Networks going to do. And I offer you two perspectives on this today, from an internal perspective we continue to evolve Juniper as a company and we need to remain agile while focused in order to take advantage of the trends I just outlined. The sheer number of our customers and the visibility and importance of their relationship with Juniper is increasing and their expectations of Juniper are increasing as well. They expect not only best-in-class technology and products from us but integrated and focused answers to their business needs. We must maintain our focus on our service provider and enterprise customers and then organize Juniper product and investments within those priorities. So in that spirit we have evolved our organization as well, with the formation of two business teams: the service provider business team, and the enterprise business team. Both teams will be responsible for the success of all our products and services for the respective customer segment and each will represent the full power of the portfolio to their respective customers. In addition we announced some organizational changes as part of a structured succession plan, which supports these new business teams and you probably already seen the press release outlining the new appointments. And we are very excited to show-off the bench strength of the company with the recognition of Eddie Minshull, Jeff Lindholm and Kim Perdikou, each of whom has several years of senior management experience at Juniper and have all taken key executive assignments. And we are also glad to report on our potential as seen from outside the company as we welcome Paulette Altmaier to Juniper in a key executive role with her wealth of experience, reputation and proven success in the industry. But what really matters is beyond how we organize inside the company, it’s what our talent and focus allows us to do in the marketplace on behalf of our customers, so I’d like to describe first our approach and then our strategy. First, our approach. Our primary goal is the build the Juniper brand and to expand on our trusted relationship with our customers and to provide them the answer to their strategic needs. We are measuring our success and setting our goals for our sales teams in terms of absolute growth and increasing our presence in the process. Winning the game, as we have for the last three plus years is the target we prioritize and exactly which product score the points in any particular quarter is the secondary measurement. This is why we’ve organized around our service providers and enterprise customers and beyond our individual products and our 2006 goals are stated in terms of customer mind and wallet share and whatever mix and products and services are necessary to achieve those goals. All of our customers whether we talk to service providers or enterprises required carrier class reliability. The lines are blurring but this where our opportunity and our leverage are becoming actually clearer than ever because they all need traffic processing infrastructure to succeed, and this placed to our advantage as we’ve seen in the classic enterprise market where we do approximately one-third of business today. As you also know this represent only a small scale of this market and that’s a large opportunity looking forward while our strength in the traditional and emerging service provider market continues to be the foundation of our innovation and growth. Our strategy and the tactics remain the same as they have been since the inception of the company 10 years ago. Our strategy simply stated: Juniper is the best supplier of Traffic Processing Infrastructure for the delivery of Virtual Networks Services. And our tactics: focus and execution as always. The strategy is easy to explain; the networking industry consists of four parts as we see it. The electronic devices we all use, the laptops, cell phones, PDAs, iPods, etc., in short all the users tools for the sending and receiving of information and entertainment. And this is equipment in the category of consumer electronics, high volume standards based, low margin, low cost. Secondly, the entertainment which comes from the movie studios and the music artists; and thirdly, the information which come through the corporate data centers and the websites and the search engines; and finally all of that traffic is eventually sent through the physical networks, the copper and optical cables, the radio base stations and the satellites in the sky. Each of these four elements: devices, entertainment, information and transport is interoperating so that when the user of the device clicks they get their answer. But none of those elements: the user, his device, the entertainment, the information or the physical cable knows anything about each other and they never will and that is where the Traffic Processing Infrastructure comes in. We at Juniper setup the infrastructure that knows the source and the destination of all the billions of people and devices and that’s where the Internet protocol or IP comes in. Then we process over that infrastructure, that’s where we apply the security for example, and then we intelligently manage the traffic itself so that the Voice over IP phone call gets there quickly and with high-voice quality where the pipe opens wide enough for the HD movie or the credit card gets encrypted for the safety of the online commerce. Put it altogether and you have the Juniper strategy: Traffic Processing Infrastructure. Every time you click, we add value. So now lets move it from the strategy and the structure to this specifics and I would like to close with three specific examples, one each for the Traffic, the Processing and the Infrastructure and in doing so answer the top three questions we’ve received from investors over the recent months. Let us start with the traffic. We’ve received a lot of questions about IPTV, one of the most topical types of traffic lately and one that has been marketed hype and claimed as their own by a lot of company’s. But let me give you some facts. According to Ovum again there are about 2.5 million IPTV subscribers on the planet today with the two largest networks in the world representing approximately 600,000 of those subscribers at PCCW in Hong Kong and FastWeb in Italy both running on Juniper Networks infrastructure. In addition to those 600,000 subscribers we’re currently operating in 14 other IPTV accounts worldwide with products deployed in 10 of those networks and trials in four others and if successful we will then be deployed in those as well. You might not know this if one were to judge by the declarations being made about IPTV. But if you separate the market in hype and instead look at the actual traffic and where Juniper operates in the network today, we are doing what we say we will do: focusing on the real customers, supporting the real subscribers. And as an example of the strategy this is the traffic part. So next onto the processing and the network security that’s enabled by processing that traffic from within the infrastructure. Another frequently asked question pertains to our growth in the security marketplace. We began with the security products in mid 2004 and if look at growth in the second half of 2004 when we began officially in the market and compared to the second half of 2005 just completed for an apples-to-apples year-over-year comparison we have grown the security business by over 30%. As I mentioned earlier we occupied the Gartner Magic Quadrant in many areas and are the only company to occupy that quadrant with four separate security offerings in the market today. We’ve grown faster than virtually all of our competitors and significantly faster than those with only standalone security products to offer. The market is evolving and it is moving to integrated networks security solutions, which favors Juniper as we’re integrating the best-in-class products and expanding the functionally of existing products at the same time. Stay tuned for more examples of progress here as we are very excited about the upcoming developments we have in this space. And this is an example of execution in the processing elements of the strategy. Processing of traffic for the delivery of the value-added service of network security. And finally to the infrastructure itself then to the last then the most commonly asked question, which relates to our leadership position in the core. And this is the easiest question of all. We shipped over 100 T640s in the last 90 days alone and we are now shipping the TX Matrix multichassis products as well which quadruples the capacity of the T640 with the roadmap to expand dramatically beyond there. I believe that’s about the same number of units our nearest competitors’ claims to have shipped in total over the last 2½ years. And more importantly the T640 ships with battle-tested and proven reliable modular software that has literally millions of hours of runtime production hardening. And I can tell you that matters when the entire business depends on the rock-solid reliability of the software. So that is the infrastructure story. So put it altogether: the IP traffic leadership, the security processing market leadership, the core backbone infrastructure product leadership, and you have our strategy in action. The best supplier of traffic, processing, infrastructure for the delivery of virtual network services. And more importantly the focus on only that, which is the reason that as we complete our first decade, and in doing so cross over the $2 billion mark in revenues generating approximately $2.5 million of business of cash every business day, we’ve enjoyed the success to make this possible. Strategy, Focus and Execution. So in summary, there are a lot of people in this market with a lot to say, and we have all got to get used to that for the next few years. In fact we can be comforted by all the marketing and the hype that will be thrown around because that’s how you can tell there’s real opportunity. And everybody wants to a piece of it. And that’s a really a sign of the disrupted change that’s underway. For many here Juniper is on the companies that ignore all of that and stay focused on the customers and the strategy, which is where this game will be won. We’ll continue to be prudent financially as well protecting our financial objectives and balancing them along with our strategy and our technology lead and our customers. We’ll invest surgically and will measure carefully and constantly, and this will multiply to many times more than that as a result of our discipline to focus on areas where we can add value. We are at the intersection of opportunity through which the entertainment and the information must travel on its way to the devices and the users to deliver value and every time you click we’re there. We have an obligation to our customers, and an opportunity to deliver to our shareholders, and will continue to realize that opportunity as we enter the second decade of Juniper’s execution. Our strategy puts us right where we want to be in the middle of it all: the traffic, the processing and the infrastructure. We couldn’t be more excited about our position and the encouragement we’ve received from our customers, service providers and enterprises to accept their invitations to sit at their strategic planning tables with them and to play a larger and larger role in the network future. And we fully intend to deliver on their trust in Juniper Networks in 2006 and beyond. All of this is possible only with the support of our employees whose continue commitment and incredible efforts make these results possible as well as our many partners, our customers, our suppliers, and our long-term shareholders. I’d like to thank you all for your continued support and confidence in Juniper Networks. Rob, I will now turn the call over to you.

Thanks Scott. I am pleased with all of the financial metrics for the quarter, which I’ll review in detail. However, please remember that our business will be lumpy by application, by geography and as well as by product mix. Total reported revenues for Q4 was $575.5 million, an increase of over 5% from last quarter and almost 34% from the year prior. For 2005, revenue was $2.064 billion, up over 54% from 2004. We are pleased with the quarterly growth in our infrastructure products, recognizing product revenue of $276 million, up over 5% from last quarter and up over 25% from last year. For the full year of 2005, our infrastructure products grew 40% from 2004. We’ve recognized revenue on a total of 2,643 units this quarter and we shipped 40,183 ports, which was up from last quarter. This quarter the core again represented more than half of our infrastructure business which is primarily driven by increased capacity requirements that Scott referred to. This mix continues to affect the oscillation between the edge and the core and is likely to be a continuing phenomena given the specific service provider requirements. The service layer technology revenue, which includes Firewall, SSL, IDP and other security products as well as J-series, Session Border Controllers and application-accelerator solutions totaled $112.5 million. That reflects an increase of about 3% from the last quarter. We are very pleased with the normalized year-over-year growth for the quarter of 25% for security products and 26% including service. As Scott discussed earlier we are focusing the business on customers, specifically service providers and enterprise. From 2004 to 2005, our service provider business grew approximately 53% and our enterprise business grew above 58%. We would also like to share some qualitative information with you regarding each of the market segments. In aggregate service provider technology was flat, we saw growth in the high-end Firewall, SSL VPN, IDP and J-series was relatively flat performance in Session Border Controllers and Application Acceleration Solutions. On the other hand, we saw softness in the low-end and mid-range firewall and a minor contribution from Funk, which closed prior to the end of the year. Total service revenue was $86.9 million, up approximately 9% from last quarter. This increase was due to the increase in professional service revenue, i.e. is training, resident engineers and consulting as well as the growth in the installed base under contract. For the full year of 2005, service revenue was $293 million, up 69% from 2004. The total book-to-bill ratio issue was greater than 1 in the quarter. Siemens was a strong contributor in the fourth quarter representing approximately 14% of total revenue in the quarter and approximately 14% for the full year of 2005. From a geographic prospective the Americas represented 47% of total revenue in Q4 and the growth was driven by increased competition for Triple Play and Quad Play service offerings. The Americas grew 54% from 2004 to 2005. Europe, Middle East and Africa: EMEA represented 31% of total revenue in Q4 with strength across the region including Spain, Finland, France, Greece, UK, Italy and Poland. EMEA grew 60% from 2004 to 2005. Asia represented 22% of total revenue. The decline for last quarter specifically associated with decline in Japan as well as softness in Hong Kong and Korea, which is primarily due to NGN, which Scott discussed earlier. However, looking back at the last 12 months, Asia was a strong contributor in 2005 growing 49% from 2004 to 2005 and Japan grew 30% during that same period. We expect to see continued lumpiness by sierra as quarterly trends fluctuate. However we are pleased with the geographic balance and even with that we continue to generate. Revenue through our direct sale was approximately 30%, up from last quarter and was a refraction of the strength with our service providers in the America’s, what we saw directly with the remainder going to our global and country specific distributors and resellers. We continue to be pleased with the growth in our distribution channel as we maintain the expansion and leverage of our channel presence. As a remainder, all enterprise orders were required to be put through a channel partner, this policy was established to provide a channel complex with the direct sales force. Gross margin was 68.5%, inline with the higher end of our expectations and down slightly from 68.7% last quarter. We do expect gross margins to be lumpy as the geographic and product mixes fluctuate going forward. Service margin was approximately 52% versus 51% last quarter, reflecting an increase in the service revenue. The non-GAAP preferences that I am about to discuss exclude the amortization of purchased intangibles to pay compensation, restructuring the payments and in-process R & D. Please see the press release on our website for reconciliation of non-GAAP to GAAP results. As a reminder, all of the operating expenses include one month of expenses from the recent Funk acquisition. So R&D expenses were $97.7 million, and accounted for 17% of total revenue, which compares to $90.5 million or 16.6% last quarter. This increase is due to the headcount growth with recent acquisitions and increased programs given our focus on internal development. We continue to invest in both standalone as well as integrated products in order to satisfy our customer needs. In addition, we invested on expanding on our global R&D efforts, specifically in China and India. Sales and marketing expenses were $124.9 million and accounted for 21.7% of total revenue, which compares to $116.2 million or 21.3% last quarter. This increase is due to headcount growth including recent acquisitions and an increase to our high touch model for the enterprise opportunities where we’ve already started to see the return on investment as well as continued channel and partner investments and brand development. G&A expenses were $16.1 million and accounted for $2.8% of total revenue, which compares to $17 million or 3.1% of total revenue in the last quarter. Operating expenses were $238.6 million and accounted for 41.5% of total revenue, this compared to $223.7 million or 40.9% of total revenue in the last quarter. Total operating income was $155.4 million or 27% of total revenue compared to operating income of $156.4 million or 27.7% of total revenue in last quarter. Net interest and other income totaled $17.9 million compared to $14.7 million last quarter. This increase is due to the increase in our cash balances as well as higher interest rates. Our effective tax rate was 31%. Non-GAAP net income increased for the quarter to a $119.6 or 20.8% of total revenue compared to $114.7 million or 21% last quarter. Diluted non-GAAP earnings per share were $0.20 versus $0.19 in Q3. For 2005, non-GAAP net income was $430.6 million or 20.9% of total revenue compared with $238.6 million or 17.9% from 2004. On a GAAP basis, which includes the amortization of purchasing the intangibles, the employee compensation, restructuring and payments and in-process R&D of $35.2 million in Q4. Our operating expense totaled $277.1 million and net income was $105.5 million or $0.17 per share compared to net income of $84.1 million or $0.14 per share on Q3. For 2005, GAAP net income was $254 million or 17.2% of total revenue compared to $135.7 million or 10.2% from 2004. Now few comments regarding the balance sheet. Cash, cash equivalents, short and long-term investments were over $2 billion. We are extremely pleased to announce that we generated almost $200 million in cash flow from operations during the quarter. And as a reminder, we used approximately $100 million in cash to acquire Funk software. Accounts receivable was $269 million and day sales outstanding was 43 days versus 40 days last quarter. This is slightly above our target range of 30 to 40 days due to our product mix shift, which caused the component shortage at the beginning of the quarter. Total deferred revenue was $252.8 million, which is made up of service, channel inventory, and product, currently unrecognizable for revenue. CapEx was $39.3 million, up significantly from last quarter due to engineering combination of Doordarshan, India infrastructure and lab equipment and depreciation was $15.4 million during the quarter. Last quarter, we stated that we will be more aggressive with our stock repurchase program, we specifically made the decision however to use approximately $100 million of our cash to purchase Funk software and we will be purchasing common stock. We will continue to look at repurchasing common stock opportunistically. We ended the quarter worth 4145 in total headcount, up from 3784 people at the end of the last quarter, with approximately 140 of the increase coming from Funk software. In addition, we invested on all areas of the company to support and scale the strategy that Scott outlined earlier. Before discussing the guidance, I would like to state that our No.1 goal is to grow revenue and earnings and to deliver right growth within our operating model. We remain comfortable with our long-term model of producing gross margins in the 66% to 68% range and operating margins in the 25% to 30% range. The following forecast and guidance are forward-looking statements and the actual results came vary for a number of reasons including those mentioned in most recent 10-Q filed with the SEC. Now for our goals and guidance. We will again use the same time horizon in which we provide guidance as we did in 2005, specifically the first quarter as well as the first half. We’ll continue to focus on our financial fundamentals and please remember, it is difficult to predict the level of business each quarter but we are managing to our financial plan, and we would like to share some thoughts with you. In Q1, we are currently forecasting total revenue of $565 million to $575 million. This guidance reflects over 25% growth from the same period of last year and takes into account seasonality in the Americas, given a new calendar budgets of our customers that has not been finalized as well as softness in Asia, specifically Japan, which Scott and I referred to earlier. We currently expect similar gross margins to those we reported in Q4 and therefore we are giving the same guidance range as last quarter of 67.5% to 68.5%. As I stated previously our long-term gross margin target remains in the range of 66% to 68%. We are currently forecasting operating expenses to increase by approximately $8 to $10 million in Q1, mainly due to increased R&D investment. Investments in R&D forms a two primary categories: first programs which we committed to in 2004 and 2005, which are long-term development programs comprise of simultaneous investment in both standalone product development programs as well as integrated products. Second, we allocated a couple of million in a proactive way given the opportunity that we see ahead. In addition we’ll have our full quarter of expenses from Funk software as well as an increase in software expenses. That being said there are areas where we are not spending and more importantly looking for savings including holding marketing programs flat, keeping IT flat by moving responsibilities to India, reducing manufacturing cost for off-shoring as well as outsourcing R&D to countries like China and India where 25% of our R&D workforce is now located. This puts Q1 operating margins at the lower end in our 25% to 30% long-term operating model. But I would like to reiterate what Scott said earlier, we believe our investments made in 2004 and 2005 will payoff as we have pipeline of new product being delivered over the next 12 months. We must continue to invest albeit prudently in 2006 to take these products successfully to market, including sales and marketing to the enterprise as well as service providers. I would like to emphasis that we will spend strategically and focus on the areas that give us return on investment for intermediate and long-term. We are also lowering the tax provision in 2006 to 29% to reflect the global distribution of revenue and our investment of those earnings outside the United States. And we expect shares in the range of $610 million to $615 million and approximately $0.19 of non-GAAP EPS. As we previously disclosed, this includes $0.01 adverse effect, due to unrecognizable Funk revenue given purchase accounting rules in the full quarter of Funk acquisition expenses as well as associated strategic investments we made in Q1. For the first half of the 2006 we expect revenue in the range of $1.15 to $1.16 billion, which is up over 20% for the same period a year ago and non-GAAP EPS up $0.38 to $0.39. We see expanded growth opportunity in the second half of 2006 given the expected up tick in the NGN buying as well as our new product cycles gaining momentum. Consistent with our prospectus we’ll update our first half guidance after the completion of the first quarter and provide second half guidance upon completion of the first half. The GAAP EPS target is not acceptable on a forward-looking basis due to high variability and low visibility with respect to the long recurring charges, which are excluded from the non-GAAP EPS estimates. I’d also like to give you advance notice of some minor changes we will be making in 2006. First in Q1 will be required to report GAAP results including options expense and given our goal which is to be transparent, we will provide the details you need to do your analysis on Juniper. However, we will continue to focus our financial objectives based on the pro forma results. And since I’m on the topic of option expensing, the Board of Directors approved an amendment to accelerate their scheme of options granted for the price include to or more than $22 per share, within post sales restrictions excluding officers and directors. Second, effective Q1 the Session Border Controller product family, which represents just over $1 million in the quarter just completed the revenue has moved from the service layer technology products group to the infrastructure product group, given the integration of the technologies that are underway. This will be reported accordingly in Q1. Finally we could do to focus on our objective of delivering high quality financial metrics. Now we would like to take questions, can you limit yourself to one question. Kathy Durr, Vice President, Investor Relations: Brian, can you please instruct the audience regarding the queuing process.

Q - Nikos Theodosopoulos: Yeah thank you very much. I guess, I had clarification and a question, my clarification was the comments that you made on Siemens. I think you said they were 14% for the year in the quarter given prior disclosures that you have given in your Q’s, if they were 14% for the year, I can’t – it doesn’t seem like it could be as high as 14% for the quarter. So if you can clarify that. My question is on the guidance, the first quarter guidance is pretty clear. On the second quarter given all the projects that you see and the ramp of Japan, why wouldn’t we see a slightly stronger second quarter after it’s seasonally down first quarter? Thank you. A – Pradeep Sindhu: On the Siemens numbers, there is huge revenue recorded is what we have. So I will, it will rule a bit while some more on, why you think is there that difference? With regard to the second quarter guidance, we are seeing some very good program rollouts during this year but we believe it’s prudent given the NGM port etc. that we provide the guidance that we do and then we will see how things evolve as we move forward. Q - Nikos Theodosopoulos: So it’s basically the timing of the NGM spending ramps, you see it coming, but its just not clear whether it will be second quarter or third quarter or first quarter, it's the timing question here? A – Rob Strugeon: Nikos, it's got a couple of things, I think it is a timing question as to some of these rollouts. And some of it is trying to get at the magnitude of the services rolled out across these NGMs and some of that growth rate and things like IPTV, some of it is looking at the, particularly some of the volumes of video demand and music demand. I know, you know, the impact of the type of service here on the network infrastructure is dramatic. You can have thousands, millions of people e-mailing and you can dwarf that with the small number of HD movies. So part of what makes it unclear for us is to is to what the magnitude of some of this next generation network infrastructure rollout is going to be is trying to gauge the service mix across it. And I guess all of us see more and more and more demand for the kinds of services, which seem no difference in an e-mail to someone who simply attaches the photo for example, from their cell phone. But for those of us in the infrastructure business, a few photos is worth 100 of phone calls. So that’s the other part of it. It’s just not being sure what mix we will see things like images and music and movies start to populate the infrastructure. But it makes a big difference in mix and that translates into big difference in capacity demand. And then also intelligence needed in the infrastructure so those are all things we just going to wait and watch and see. Q - Nikos Theodosopoulos: Okay, thank you. A - Robert Dykes: And then to your question on the Siemens, the numbers for Siemens in Q1 was 13%, Q2 was 16%, Q3 12% and Q4 14% and in the full year it was 14%. Q - Nikos Theodosopoulos: Thank you. Kathy Durr, Vice President, Investor Relations: Next question please.

Thank you. Our next question comes from the line of Ehud Gelblum at J.P. Morgan, please proceed with your question. Q - Ehud Gelblum: Hi, thank you. My question has to do with the acquisitions that you made earlier in the year between Redline, Kagoor and Peribit Network types of things. You went through some detail, great details on the service provider technologies. And in my calculations it looks like they were roughly flat, most of the acquisition in there and the next thing was up a little bit. How do you see in your revenue guidance for the next couple of quarters, I had actually expected those to be a real bit stronger, they sell on to the enterprise, they are usually a little bit more of an end of calendar year fresh for those. Do you expect those products, I guess, Netscreen as well as the acquisitions to stay relatively flat and maybe will they pull back in a weaker Q1 as well or shouldn’t they actually be growing with, as you kind to get further in, like NGM share in this market? A - Pradeep Sindhu: Couple of thoughts Ehud, first on year end, we actually have not seen or didn’t see in the year end just completed the kinds of budget flush or year-end activities and that in some years, although we actually haven’t seen that for few years, really so, I guess, that’s still something that we all remember but it isn’t something that we have seen in the couple of years and we really didn’t see at this year either. But to your point about the – to the mix of revenues we look out over the first half of the year, it's quite likely that we will see growth in many of these individual examples, we the application performance technologies, I think will continue to see some strength in various of the security categories and clearly the need for some of the features or the functionality that’s in particular capabilities around optimizing website, managing for distance links like that is relevant. But the thing that affects us a little bit on this also is partly by design and that’s the function of how we are managing the compensation incentives and how we are motivating the field organization. And its even more highlighted by the change, we’ve formalized in the rest of the company organization here this entering the New Year which defined the rest of the business, the way we motivate the sales force which is go into an enterprise account and secure a percentage of their mind share and market shares as a customer of ours. And we don’t motivate the sales force specifically to do that by selling three firewalls and four WAN optimization devices and two routers. We just give them a number to go into an enterprise account for example and established Juniper presence. And so as a result, it distributes their focus more based on the brand presence we are trying to achieve and that is really what translates into the growth of enterprise as you saw, I just talked about here. It doesn’t necessarily translate into a condition where every player on the team scores on every play. And we aren’t really trying to do that, we are really trying to make sure that the brand grows and that the enterprise presence and our strategic presence in the account grows. And if that were to happen all with firewalls, or all with routers or all with application performance products at any instant in time and that will be fine. And in the last quarter it happened more on the products we identified around the high-end of the firewall business in SSL and IDP and was relatively flat. It will probably shift around a little bit next quarter but I just like you to have some color on the way we are measuring and motivating the efforts that we’ve got underway. A - Robert Dykes: And I would like to point out, if anyone gets the wrong impression they have that, year-over-year the security business grew 25%, I just want to reiterate so we did see some very good growth rate, we are very pleased with the performance of that business. Q - Ehud Gelblum: That was apples-to-apples for Netscreen, that doesn’t include the acquisition? A - Robert Dykes: Yes, it’s also normalized for some of the accounting impacts. So the actual numbers if you would see, if you looked at the financial results it will be lot higher than but for actual accounting results that’s normalized for real activities. Q - Ehud Gelblum: And last thing, do you have what Funk contributed this quarter? A - Pradeep Sindhu: We have given exactly that numbers, just a minor amount. We really acquired Funk more for the technology going forward than first revenue contribution. I think it's going to be a significant contributor in our technology on a forward-looking basis. Kathy Durr, Vice President, Investor Relations: Thanks Ehud. Operator next question please.

The next question comes from the line of Stephen Kamman, of CIBC, please proceed with your question Q - Stephen Kamman: Thank you, two quick, main question is on the enterprise business, sort of that, whatever you are calling at, it looks like particularly last quarter that actually came in on an operating loss and I guess you had pretty significant increase in unit chips about 46%, but I am assuming that that was bundling. Can you just about talk about sort of how you are going to evolve that in terms of bundling products going forward? And then the only other question is, the accounts payables are pretty significantly and just any comments you can provide on that? A - Robert Dykes: First of all on the enterprise business we don’t actually report the profitability of that independent so I am not sure where you get in- Q - Stephen Kamman: Mentioned in 10-Q. A - Robert Dykes: That was SLP. The enterprise business overall includes a quite of the IDP products and in overall we have a significant sales force dedicated to that and we would generate a profit overall. And again those fourth quarter as well. Q - Stephen Kamman: Okay and then on the SLP business, it was, again a negative 15% operating margin even though revenues were up 8%, you had 46% increase in unit shipped, so the question, I guess is what was going on there and what happens going forward? A - Robert Dykes: What is going on Steve is that we are making a significant investments in our sales organization to grow our enterprise business necessarily a portion of that and so we are already driving that plus we have some significant investments on the R&D side in that business. And so probably overall that is an area for focus for us, it is an area for us to really generate some growth in the future periods. A - Scott Kriens: And also Steve, its Scott answering just answer up the second question you asked about DSOs. The DSO’s were 43 days this quarter versus 40 last quarter so it’s up slightly partly a function of some later in the quarter shipments out of manufacturing because there is some supplies issues but no more major concern on our part there, and we still expect to be within our guidance going forward. And again the difference between SLP and Enterprise is just a clarification is really around the same point that we want to emphasize is that we are really driving the business towards the total portfolio and enterprise and which obviously includes a several $100 million of routers that get sold into that market as well as the SLP so, its hopefully be helpful for everyone as we get this clarified more based on the customers than less on individual slices of the product portfolio. Q - Stephen Kamman: Okay yeah I thought that I had got confused there. Thanks very much. A - Scott Kriens: That is alright, thanks Steve. Kathy Durr, Vice President, Investor Relations: Not a problem. Next question please.

Our next question comes from line of Scott Coleman at Morgan Stanley. Please proceed with your question. Q – Scott Coleman: Sure, thank you. Scott when you are looking at IPTV deployments, particularly guys like PCCW and FastWeb, is there a way you can help us understand bandwidth capacity requirements there and where you – if you tend to see it more at the core first or more at the edge, how do those deployments go about? A – Scott Kriens: It’s a great question with unfortunately long answer, but the short version of it is, at the moment we see more linear of what I’d called balanced impact on infrastructure with these types of services meaning that the TV or the video services have launched from the core infrastructures and delivered out through the network. I mean it has sort of an equal burden as it travels but where the network architectures are going and one of the things that I think it’s going to be a fairly dramatic differentiators overtime is something called multicasting and its ability to essentially ship one copy from the core and then start replicating as you move up the tributaries. And its only part of the intelligence that will be applied in the networks as they become more heavily loaded with different type of services and traffic. And this is where I think what’s going to happen in the early days of this, which is the networks because the volumes of these news services are fairly low, this is easier to throw bandwidth at it, but as the volume of - the number of types of services and the volume traffic that is generated by video and other of these things and streaming services versus bulk download services and thinks like that, if that increases the networks going have to get increasingly clever, architecturally and operationally in order to handle that so, it makes it really difficult this is part of the question you know Nikos was asking as well: how do you really know what the mix of service impact is going to be on these networks? And it’s a hard question to answer because depending on the sophistication that’s deployed the networks will become more intelligent, and the impacts will be less but in the first days you’ll see a lot more impact while people just simply throw bandwidth at the problem, and we are seeing more of that today than we assume the real intelligence that’s being designed. And that a big part of this whole next generation network consideration that we’re seeing take place in places like Japan where they’ve got 3 million fiber to the home customers, and they are starting to realize that you can’t roll services out in bulk form at those kind of bandwidth with the tributaries without putting more intelligence and design consideration in the infrastructure so, I mean it’s a kind of thing that we are seeing go into some of the ripple or redesign across the marketplace, and I think we are going to see that continue here over the next year or two as we see this types of services increase. Q – Scott Coleman: Great thanks Kathy Durr, Vice President, Investor Relations: Operator, next question please.

Your next question comes from the line of Subrahmanyan at Sanders Morris. Please proceed the question Q – Natarajan Subrahmanyan: Thank you. My question is on the infrastructure business. When we look at the first half of the year, and some of the guidance in there, can you talk about our competitive factors having any impact at all in guidance, is it primarily these delays in Asia which are causing you to kind of moderate the rate of growth or competitive factors having any impact especially at the edge of the network? A – Rob Strugeon: Subu, we don’t much change in the competitive situation, it is definitely the case but some of the design pause if you will or refresh is going on and the thinking in Asia has a lot to do with what we see and as much as anything in places like Japan and Korea and elsewhere you see there is a tremendous, like its almost embarrassing speaking of it from here in the United States, how far behind we are or maybe said in the favor of some of these countries how far ahead they are, and not only the rollout of services but the willingness and the options and the comfort with the users and the population have with gaming and instant messaging and movies and music and things like that on all kind of devices the portable to the home and others. And so they are a lot - those are significant consumers are the kind of things that we provide and when they pause and rethink some of this it has more of an impact, but I think the competitive landscape is largely the same, there is people out there trying to bring the cheapest solution to the party and there’s other people who trying to bring the biggest catalog to the party and so we’d like to think of ourselves as competing with the best and were competing with those with the most and those with the cheapest, and that hasn’t really changed and I don’t actually think that it will much. I think we are going to continue to see competitors in this market and we are going to continue to read a lot of press releases and hear a lot of promises and a lot of claims be made. So I’d expect that its not only to continue but probably the volume will probably go up on this kind of stuff in ‘06 but when you get down to network decisions in a short-list and the deployments we haven’t seen much change. Kathy Durr, Vice President, Investor Relations: Operator, next question please.

The next question comes from the line of Mark Sue at RBC Capital Markets, please proceed with your question. Q - Mark Sue: If I look the large plan performance by the major telcos for IPTV the new DSM to be going to large system integrators, so many discrete component to work hand-in-hand with each other, what does that mean for Juniper, do you scale the business and make more acquisitions to a have end-to-end product portfolio or do you just focus on the routing component? A – Scott Kriens: Actually Mark, it is going to be interesting to see what the rollouts really become, because there is a couple of I think fundamental contradictions in some of the claims that are being made. End-to-end if you disassemble that assertion is essentially a codeword for proprietary, because if its truly end-to-end and there is some benefit in it being end-to-end that’s because there is something unique about the pieces and the way they work with each other and they will only be unique if they were proprietary, I don’t think any of the operators I have spoken to in the last 5 years and its probably getting more intense not less are interested in proprietary solutions. So when someone says they’ve got end-to-end open standards that’s an oxymoron, if it’s end-to-end then there is some benefit in that then it is not open and if there is the benefit then its proprietary, which is followed by another oxymoron, which is the manufacturer system integrator and either your system integrator, which means you’re an honest broker putting together the ideal elements from the market at large and presumably an open standards way or your manufacturer in which case there’s no coincidence that your recommendations as a system integrator equal all of the things that you manufacturer. And I don’t think that’s lost on any of our customers either so again it is the difference between I think a lot of coincidence that are being made and a lot of multiyear and multibillion dollar declaration that we’ve all read and what’s actually going on when you add up the number of IPTV subscribers and the people that are serving them, I don’t disregard the fact that our customers and our service providers are looking for more comprehensive solutions though we tend to believe that what they are looking for are side-by-side solutions and BT 21C is probably a great example where Junipers partnered with Lucent and Siemens in both the core and the edge and BT itself is also coordinating across other companies including our competitors to deploy technologies. I think if we were to look at that example as one it’s probably the more practical example of the kinds of things that I think are actually going to succeed. So you know if you take the part some of these assertions even on the face value of what’s been said it doesn’t make sense in the minds of the customers so I think what you’ll see as a net of all that is continued increasing, in some cases we’ve seen contractual requirements for open standards and for us that will allow us to stay out of the business in building consumer devices for example or stay out of the business of building optical terminals and things that don’t have anything to do with traffic processing infrastructure, but be a very incredible solution for the infrastructure that ties those spare of pieces together and I think that focus is what has been and is going to continue to be the key our success Kathy Durr, Vice President, Investor Relations: Next question please, operator.

Thank you. Our next question comes from the line of Shah Wu at American Technology Research, please proceed with your question. Q - Shah Wu: Yes just a housekeeping question. Regarding Funk software, how do you plan to recognize the ramping for that, will it be would put under or will there be a separate line item, or will it be under the kind of traditional areas? Thanks. A – Robert Dykes: Yes, Shah it’s going to be reported as SLP revenue and profitability. Q - Shah Wu: Would you might, is it going to be on the service layer? A – Robert Dykes: Yes. Service layers. Q - Shah Wu: Okay thanks. Kathy Durr, Vice President, Investor Relations: Brian, Next question please, operator.

Our next question comes from the line of John Zhou with Lehman Brothers, please proceed with your question. Q - John Zhou: Thank you very much. My question is on new product for this year, I think you mentioned that you have a pipeline of products for this year. I was hoping could you please expand a little bit for sort of the direction and the sort of type of products particularly in a routing space for core routers and edge routers, what are some of the features on new things you are working now and the timeline for that? A – Scott Kriens: John, the product announcement themselves and the specifics behind those will be forthcoming as we go out through the years so that will be the time we speak in detail but generally speaking what we see is the opportunity for further interrogation and further interrogation of security capability along with the network capabilities and as far as the broader infrastructure portfolio it goes across two dimensions, which need to happen in contact with one another and that would be performance and intelligence. One of the things which its relatively easy, I guess none of this is really simple, but it is relatively easy to improve performance as long as you leave the processing requirement in a simple state and it is relatively easy to do complex processing as long as you don’t have do it very quickly. But what’s very difficult to do is sophisticated traffic aware of processing on high performance infrastructures where reliability is in the case of some of our defense industry deployments is life-saving and that triumphed of need accomplish simultaneously is what drives the portfolio. Most of the translation of that into specific features from someone outside the industry or not deep in the engineering and technology would be very obscure. But once the work is made or when one looks much closer into what that actually takes to do in some of those features and what they mean it is really quite critical to the decision cycle so I think broadly speaking its integration and then it’s the combination of performance and intelligence and these are things that we think we’ve got some unique, intellectual property which is the part of it, but actually what we have this more unique or what’s more valuable to us as we deliver on some of these things as we have practical working experience with systems and billions of hours of runtime of that experience or let us do somethings that we think others are going to have a little time for figuring out. Q - John Zhou: Do you have new products new edge or core orders for the year, I am sorry? A – Scott Kriens: Again we will make specific announcements on the products at the time of their availability but you’ll see us with quite a lot to say this year. Q - John Zhou: Kathy Durr, Vice President, Investor Relations: Next question please, operator.

Our next question comes from the line of Gina Sockolow at Buckingham Research, please proceed with your question. Ms. Sockolow your line may be on mute, we cannot hear you. Okay. We will proceed with the next question.

From the line of Jeff Evanson at Sanford Bernstein, please proceed with your question. Q - Jeff Evanson: Scott, I have at least heard in a few conference calls talk about the blurring of distinction between enterprise and service provider products. Yet today I heard you talk about the widening organization around the enterprise team and the service provider team. I am wondering if you see some execution opportunities by separating the teams or if there are other issues involved in doing that? A – Scott Kriens: Great question actually Jeff, let me clarify the distinctions. In a short answer, some usually better the longer one but I cannot give you a shorter one. The short answer is it’s the difference between products and distribution. The conversions you talked about and that as we see is around the product and technology side of things, the need for the reliability and the intelligence and the traffic awareness and the security and all those kinds of things. Those are very much converging and whether the end-user is a subscriber of a public network or an employee of a public network or a soldier in a tank for that matter and we serve all three of those customer types. The infrastructure requirements for performance and security range from what I call important in the service provider for example in the business case to really important in the tank. And so that technology and other things required to do that are quite common, the distinction between the enterprise and service providers piece of this is more on the distribution side and on what it takes to work through the channels in the distribution and reseller relationships that are needed especially with a wider range of products and a larger transaction volumes in the enterprise as well as on the service and support side, where in a case of a major enterprise account it is actually similar both dedicated and major account teams as well as dedicated service and support attention but even in those accounts and certainly in the small medium businesses or medium businesses really where we tend to look more, that the expectation of a more complete handling of their requirements and less technical expertise less operational focus, and then of course you would seen in the service providers, so that’s really the distinction between focusing the business teams, and also a more completely managed and integrated solution from a portfolio standpoint in a enterprise or other environment then would tend to be more self-integrated, more managed in the case of a service provider. Q - Jeff Evanson: And proof from that the R&D organization both be still organized around capabilities, or some other structure but not necessarily around service provider or enterprise? A – Scott Kriens: But that’s exactly correct, there is still an infrastructure product group, a security product group and an applications product group, those are unchanged but they now become part of two virtual teams for purposes of go to market exercise one for enterprise and one for service providers and so you are exactly right Q - Jeff Evanson: Thank You A – Scott Kriens: Thanks Jeff. Kathy Durr, Vice President, Investor Relations: Next question please.

Our next question comes from the Christin Armacost at SG. Cowen & Co., please proceed with your question. Q – Lucas Gwenky: Hi this is Lucas Gwenky for Christin, my question is related to a comment you made at the end of your prepared remarks on the session border controller being now categorized in infrastructure group, did that occur at this quarter I think you might have said next quarter will be the first quarter and if so does that mean that that it is not being sold separately any more? A – Robert Dykes: It’s Q1 that we are make you the change, so in Q4 we reported in the SLT product group and as to the products it is still a standalone product at the moment. Q – Lucas Gwenky: So I guess that would bring the question why move it? A – Robert Dykes: Well we talked about how we implement towards having more integrated products down the road and so we saw thought it is best to move it into that group, from a product point of view. Q – Lucas Gwenky: And then separately you know you’ve disclosed, the new business unit service provider enterprise, are you going to provide any kind of more quantitative details around that going forward? A – Scott Kriens: Luke, couple of thoughts, first of all, final part on the session border controller technology, as we talk about we made the acquisition as the company that brought that to us, it always been targeted as an integration activity or integration priority for us, so and that is really the destination of that technology in the industry. But separately in terms of reporting we will likely end up still reporting as we described by product groups that one of the problems with enterprise and service providers is customer type from a pure financial reporting point of view, its not so easy to know, through one or two tiers of distribution exactly what the type of customer is and even within the service provider in case you can have a service provider buy the product and puts it in his own network and sells it sells it as a service, that same customer can buy it and use it internally and the affect the enterprise and can also distribute it and sell it to someone else either as a managed service or as a transfer title, so it gets a little bit difficult from a pure accounting standpoint to be precise about the business but what we do, and what we will do here in just providing as more details as we go forward and as much details we can and obvious is report on both on the products which would be very specific as obviously we can identified by products numbers, and then report as we see it on the business as a percentage of total in service providers and enterprise so, look for both it is only possible to be specific to a certain degree in the customer types. Q – Lucas Gwenky: Okay and then finally the service layer technology, what is the next service layer technologies that you are considering, you know either developing or acquiring? A – Scott Kriens: In maybe like the next acquisitions or? Q – Lucas Gwenky: Well just internal development? A – Scott Kriens: Well I would say, obviously something that we can really comment on and we will watch and see how the year unfolds but I think its really more in this category of technology, its more a function of integration and to trying to take capabilities and bring integrated solutions to bear so most of our efforts will be focused on doing that over at least the near-term. Kathy Durr, Vice President, Investor Relations: Next question please.

Our next question come from the line Alex Henderson at Citigroup, please proceed your question. Q - Alex Henderson: Thanks. There has been a article written in China paper and pick up for light reading that the Siemens is interested in acquiring data networking product line from Harbor line, am not asking for you to comment on whether that is going to happen or not, it is obviously has been announced but, the speculation around Siemens especially backing away from USA distribution partner is obviously been out in the field , can you address the relationship you have with Siemens and what do you expect that or give us example of how that business with them is continuing and whether its strengthening or weakening? A – Scott Kriens: Sure can, Alex, on the subject to relationship in general its a strong as it is ever been and those relationships are always a function I guess on multiple dimensions, one is that the field and operating levels country-by-country there is deep long term trust built between account teams that are working together and places like BT 21C and things like that, and actually lots, lots of others, as you can see reflected by their continued strength as the percent of total revenues so, at that level there is great strength and depth and I would say concrete port around those relationship and the trust. And that is actually one of the things that takes as you know may take a few years to get there, and because the account team is don’t start out trusting third parties with their own accounts and today we have got very good and strong relationship there. Furthermore when that relationship moves up the ladder, with Thomas and the people that run the company and the divisions that are involved here those are relationships that are also long standing and quite strong so, we have every confidence in the Siemens relationship and what we sees is opportunities for both companies going forward and I can’t speak for them obviously as you say I wouldn’t but I certainly - we view this as a very strategic relationship and have every indication to support that from that every conversation we ever had with them. Q - Alex Henderson: If you were to look at the Harbor line, is that a complimentary line to your line, if hypothetically it was acquired? A – Scott Kriens: Well we don’t I don’t actually know whole what about Harbor because, we don’t compete with them, you have heard and read some of these things but your reference in that had been speculated but, I really don’t, since we don’t compete or see them at any of the deals or markets or business that we do, I can only give you the kind of things that I suppose you can find on their own website about what they do, it just isn’t something that we see in our markets. Q - Alex Henderson: Also if you are not competing with them then anybody selling them would have to be either complementary which certainly wouldn’t become replacement to your product line. A – Scott Kriens: Yeah. As far as, certainly that if there was anything that they had the offer that would be competing it is in something it is ever been seen in any competitive deals we are aware of. Q - Alex Henderson: Thanks A – Scott Kriens: Sure thanks Alex. Kathy Durr, Vice President, Investor Relations: We have grace time for one more question.

Thank you our final question comes from the line of Samuel Wilson at JMP Securities. Please proceed with your question. Q - Samuel Wilson: Good afternoon everyone. Quick question on allocation of capital, the equivalent 17% of market cap in cash, you are generating $200 million in free cash operations last quarter, realistically how much cash do you need in a realistic manner to run the business and if you have excess cash, kind of why are you buying back stock as it is too low, and kind of you said would on last quarter conference call? A – Scott Kriens: Well, Sam, you are right in your observation, there is over $2 billion in cash and we generate almost $200 million in the last quarter, so we are certainly, I guess we are pleased on a couple of dimension with that, those number first of all that the fire power it gives us. But secondly it is actually in my view at least it is the ultimate measure of customer satisfaction which is that they pay you and it is the ultimate measure of the health and strength of the business as it generates cash, so we are continued to be laser focused on the creation of it and to start with that point and in case for example of the recent acquisition of the Funk we chose to use cash for that acquisition instead of the equity as an example of what we have the cash for in order to avoid the issuance of more shares for in that case for that acquisition, so we will see what the market presents going forward as we mentioned in remarks as is still true today there is an authorization that we have that has been given to us by the Board that allows us to do more repurchase if we were to choose to do so and then we will watch and see what the market brings and see there in terms of that kind of opportunities or other considerations that we might use cash for in place of equity. But on the front end of end it though one of the things that everyone should expect as this business is going to continue to be strong generator of cash because to me ultimately that is the measure to help in success of the company and so it is kind of a - it is a primary metric for us around here. Q - Samuel Wilson: I completely Scott, I guess what I am asking is how much cash do you need before you start to look like the bank? A – Scott Kriens: Well that depends on who you ask. I guess, if you ask my friend here Bob he likes cash. So he would want more of it, if you ask me I might spend a little more of it. But It’s a careful consideration and all seriousness to look across the industry. I think we are watching some very turbulent time in the market and there are not going to be the number of companies standing a year from now that there are today in my opinion. Most of those probably are not go away and stay away. But there may also be opportunities for us and there aren’t, necessarily acquisitions that could be joint development, investment partnership, marketing opportunities, we have done all of those in our past and want to be armed to do any or all of those things going forward. So it is something that we will continue to evaluate on a regular basis, we have the approvals and the resolve and if we do choose to do simply in the market and buy shares but we also have the experience of using a cash for other purposes, ultimately to the same end of avoiding more share issuance and we are certainly mindful of trying to balance that equation, so we will see what happens over the time to come. Q - Samuel Wilson: Thank you. A – Scott Kriens: Thanks and take care. Kathy Durr, Vice President, Investor Relations: We would like to thank everybody for your participation today, there will an audio replay available of this call on Investor Relation Section of our website and in addition you can call 800-633-8284 and enter the reservation number 21280063. We currently plan to report our first quarter 2006 results the week of April 17th. If you have any additional question please feel free call investor relation department. Again thank you for your participation on the call today and have a nice evening.