Visiting Akamai's HQ Tomorrow: What Questions Would You Ask Them?

Tomorrow, I will be spending the day at Akamai's HQ in Cambridge where they are nicely giving me access to sit down with management and others in the company to answers my questions, talk about their product road map, discuss the media and entertainment vertical and in particular, talk about their CDN business. Some of what we discuss I will blog about at a later time, other things I'm sure will be off the record.

I already have a list of questions lined up pertaining to their CDN business and am looking forward to getting some details on where their CDN business in particular is headed. I get a lot of questions about Akamai from customers, analysts and those on Wall Street and Akamai is open to me collecting questions for potential discussion. If you were visiting Akamai, what questions would you ask them? Put your questions in the comments section and I will ask and report back on as many of them as they are willing to answer.

Note: I have never bought, sold or traded any stock in Akamai or any other public content delivery network ever.

Comments

[None]

Of the $45.5 million Limelight was ruled to have to pay Akamai, $1.4 million of that was because Akamai said they had to reduce pricing in the market due to Limelight. But on all of the Akamai IR calls they said they felt no pricing pressure in the market. I'd like them to clear up the whole pricing pressure issues. Are they feeling it or not feeling it?

[jbuck]

How is Elizabeth Appleby's government division doing?

[Brian Sely]

In it's last conference call, the CEO of AT&T has specifically stated that the company intends to ramp-up it's presence in the CDN business. How does AKAM view this announced development in terms of competitive pressure or material effect on their business? While AT&T may not have the magic sauce in terms of proprietary methods, they do have the pipes and the pockets to be AKAM's biggest threat yet.

[HankG]

Is a CDN with edge servers still a cost effective solution? Or is it more effective to have more centralized farms with good connectivity?

[Jeremy]

Will Akamai focus on the smaller content owners/publishers that intend to see rapid bandwidth growth and demand, or continue to focus on the larger already established ones?

There is no way an initial smaller player will play $2-5/GB for bandwidth on a minimum buy of $500-$1,000.

[Mike Vitale]

Have they seen any uptick in requests for Windows Media streaming since Silverlights release?

[Anthony]

What percentage of revenue in 2007 came from US companies vs non US companies? How much does Akamai expect that to change in 2008? Is continued growth at current levels contingent upon increased demand/sales of CDN services in countries such as India, China, and Japan? If so, does Akamai have similar market share in those countries?

[adj]

According to Jefferies & Co. analyst Katherine Egbert, Akamai should move from a cash tax rate of about 2 percent now to a blended rate of 33 percent for federal, state and foreign taxes in 2011. She estimates the increase will reduce Akamai's earnings per share by about 84 cents.

Does Akamai agree with the above?

[damien wetzel]

could you ask them to tell in a few understandable sentences what limelights infringed in regards of their patent.
could you ask them why they fear competition which benefits
everybody including themself, are they unsure of their technology ?

[phillip marangella]

On the Application Acceleration side of the business, can you ask them to provide details on their new CPE based ADN solution and how they plan to challenge the likes of Cisco and Juniper? Also, what's their timeframe/plans to offer the former Netli ADN solution in a PIP network?

[Martin Ortiz]

Why they are not in the P2P content distribution game? ie Abacast...

[shaun noll]

i think there is still ALOT of confusion about their pricing schemese, so.... what kind of pricing schemese are you signing? do you still use the "alloted amount and then penalty rate if you use more" style pricing? what percent of your revenue comes from overage charges of customers using more than they expected? basically just any color on that pricing scheme would be very interesting. i am seeing lots of differing numbers on this and i'm sure most of them are wrong

thanks Dan.

[Christopher Levy]

Martin!!! HEY THERE!!!

They are in the P2P game. They bought RedSwoosh.

http://www.akamai.com/redswoosh

No significant customer announcements yet that I know of but they are in the game.

+++++++++++++++++++++++++++++++++++++++++++++++

What is Akamai's strategy for DRM moving forward?

They shutoff the DRM component in Stream OS and it's pretty well known their WMRM product is aged. Will they rollout new DRM services for PlayReady DRM or Flash DRM or integrate 3rd party solutions?

Which of their major customers are deployed with the Akamai Media Framework for Flash?

[dwayne hoobler]

HEY Shaun, Martin--what p2p cdn actually has "ANY" customers?? - at all EVAR?!?- cash-positive, with "REVENUE"!? is there one out there who is not hemorraging $ out the culo. Red Swoosh may be the only "p2pCDN" around in a while cause Akamais the only one with the daddy pants and the myopia distortive enough to think that there's a business somewhere in there.

My Question: 1. How is Akamai going to stop companies like HighWinds/ Panther from eating thier breakfast, lunch and dinner? 2. How soft is their big fat soft underbelly? 3. What is that rash all about...have they had that looked at?

[Dan Rayburn]

You're right, as of now, P2P based CDNs don't have very much revenue at all. I can't think of any that are doing more than $5 million a year in services business, if that, other than some companies that focus on the enterprise vertical like VeriSign, Ignite etc....

As for question two, Panther and HighWinds only compete with Akamai on a very small percentage of Akamai's total business. Panther does not do streaming, Panther and HighWinds don't do application delivery etc.... Akamai does a lot more in the way of just CDN. Akamai's total CDN revenue for last year alone was at least $300 million. Panther's was less than 3% of that. Can they and others compete on some Akamai business, absolutely, but they won't make as much of an impact as you are implying.

[Quantum]

Question for Akamai: do they use customer-built hardware or just standard PC-based servers, especially for video delivery?
How much bandwidth (for video) can their server pump per-CPU/core?
Just curious.