List Of Video Delivery Networks Now Tops 40 Providers

Back in January, I posted a list of CDN providers for video delivery and since that post, more providers continue to enter the market. Today, the list of video delivery networks continues to grow with the number pushing past 40 providers. To make the list easier to find on my blog, all you have to do is go to www.cdnlist.com for the latest update.

Each time I update this list I get a lot of angry comments on who should or should not be considered a content delivery network. My purpose in making this list is to make it easier to keep track of all the companies in the industry. The term "CDN" is so generic these days, that there is no right or wrong answer on what makes a CDN. Everyone seems to have different opinions. That being said, take a look at what companies analysts and the media write about in the market and see who they do and do not reference as a CDN. Some may not agree with them, but that's reality. The market defines what they think a CDN is.

To use this list to make comparisons of one provider over another without looking at a company's size, products offered, revenue generated, geographic reach of network, number of formats supported etc.. would simply be inaccurate. Some of those companies listed are in beta with their offering and some literally have no customers as they have just launched in the market.

To make things a bit simpler, those on this list are what I would call "video delivery networks", meaning they have some servers they own and operate to deliver video content. I did break out those solutions that are P2P based as I think those need to be listed separately. I also listed those providers who I consider to be regional service providers, classified as those who primarily have a presence in only one geographic location like the U.S. or Europe and who tend to focus on small and medium sized customers. If you think someone from this list is missing, add it in the comments section.

In alphabetical order these are the video delivery networks that I am currently tracking in the industry:

• Accelia
• Advection.NET
• Akamai
• Amazon Web Services
• AT&T
• BitGravity
• Broadmedia
• CacheFly
• ChinaCache
• CDNetworks
• Conviva (formerly Rinera Networks)
• Digital Fountain
• EdgeCast
• EdgeStream
• Highwinds
• Internap
• Level 3
• Limelight Networks
• Mirror Image
• Move Networks
• NaviSite
• Panther Express
• PCCW
• PEER1
• RBN
• SimpleCDN
• Swarmcast
• Velocix (formerly CacheLogic)
• Voxel.net
• Vusion (formerly Jittr Networks)

P2P Based Video Delivery Networks

• Abacast
• BitTorrent
• Grid Networks
• Ignite Technologies
• Itiva
• Kontiki
• Pando Networks
• Rawflow
• Solid State Networks
• Octoshape

Regional Service Providers

When it comes to regional service providers in the U.S, Europe and Asia, there are literally hundreds of providers. Below is just a partial list of providers from those regions that I know or have dealt with in the past. This list is far from complete and if you look at the StreamingMedia.com industry directory, here and here, there are close to 200 companies listed for video delivery services. This list below could go on forever and for the most complete list of regional services providers, you should use the StreamingMedia.com industry directory.

• Arco Stream
• Arkena
• Astream
• AudioVideoWeb
• CTN
• FlyOnTheWall
• Groovy Gecko
• Ipercast
• Influxis
• J-Stream
• PowerStream
• Qbrick
• Severn Stream
• StreamCity
• Stream Guys
• StreamUK
• Stream The World
• StreamingMediaHosting
• Twofour Digital
• UpStreamNetworks
• Weebo
• Westminster Digital
• World Television

AT&T Building Out CDN, Preparing To Push Into The Market

Last December, at AT&T's analyst day, their presentation included a few slides about their content delivery build out and capacity planning in 2008 to handle web acceleration, software downloads and streaming based services.

Since December, AT&T has been busy working on the build out and expects to spend between $70-$80 million on infrastructure this year. By the end of 2008, AT&T is aiming to have 400Gbps of capacity online, for all their content delivery services, which would increase their capacity by 4x what they have now. When completed, their content delivery services will be delivered from 32 nodes in 7 countries and they will be Adobe Flash Certified by year's end and will be supporting live and on-demand delivery for all the major formats.

Currently, some customers of AT&T's are still having their content delivered via Akamai, who AT&T has been re-selling and using as one of it's partners for some time. But moving forward, AT&T expects to deliver more content across its own network and rely less on partners for delivery. AT&T has been busy training their direct sales force and re-sellers to sell their CDN services and in the third quarter, AT&T expects to aggressively push into the market.

While AT&T won't have some of the additional CDN services in the content eco-system like content management, transcoding, DRM etc... like most CDNs, they will probably partner with others in the industry who provide these services. Their content delivery services already support some additional functionality like authentication, pulling content from customers origin storage and reporting via their customer portal. While AT&T will not say how many customers they have for their CDN services today, or how much revenue they want to generate from CDN services in 2008, they have listed Forbes.com, AccuWeather.com and the U.S. Golf Association (USGA) as current customers.

While many analysts who cover Akamai were worried when AT&T talked about their CDN plans during their analyst day, AT&T still has a lot of work to do in order to become a major player in the content delivery industry. They do have some advantages going for them, most notable of which is that they are not a startup and not relying on content delivery services alone for their revenue. They won't go out of business in 18 months when the VC money dries up, like some of the other CDNs will, and AT&T has an enormous marketing budget, re-seller channel and plenty of R&D resources. That's not to say those advantages will guarantee AT&T success, as we saw Qwest, MCI and other telcos in the market fail with these same advantages years ago. But with Level 3 now becoming a major player in the CDN market, AT&T making a bigger push, it's only a matter of time before the telcos once again try to dominate this market. 

Some will say that since AT&T, Level 3 and other telcos own the network, that gives them a competitive advantage over CDNs who's don't own the pipe. Others say that owning the pipe is too expensive, requires too much capex and does not allow the telco to deliver traffic from multiple "best of breed" networks. At this stage, the verdict is still out on who is right, but one thing is for sure. The telcos are entering the content delivery market and things are going to get very interesting in 2009 when outsourced CDN services for video alone become a billion dollar market in the U.S.

Evaluating and Choosing The Right Methods Of Video Delivery

At the Streaming Media East show on Wednesday May 21st, we have a session entitled "Evaluating and Choosing The Right Methods Of Video Delivery". With all the various means of distribution and protocols available for video today-CDN, P2P, streaming, progressive download-there is still no single solution that will meet all customers' needs perfectly across all platforms and devices.

Learn the various methodologies for content distribution, as well as the pros and cons of each type. Speakers will also discuss which methodologies apply best to which platforms and geographic locations based on type of content, length and format of video, and target audiences. Panelists will also provide you with guidelines and formulas for determining the best single and/or hybrid solution for your online video distribution needs.

Confirmed speakers include:

• Moderator: Bill McCandless, Executive Editor, Multimedia, TheStreet.com
• Dave Witzig, Sr. Director, Interactive Video Commerce, ShopNBC
• Cynthia Francis, CEO, Reality Digital
• Glenn Goldstein, VP, Special Projects, MTV Networks
• Rose Karpel, Director, Video Products, Reuters

Have a topic or question for any of the speakers you want to see addressed? Submit it in the comments section and we'll add it to the Q&A portion of the session.

Registration is still open and you can see all the various pricing packages, including a one-day ticket on our website. Six years since we took over the StreamingMedia.com business and we've still managed to keep the conference very affordable for everyone to attend. A full two-day conference ticket is only $895.

Overview Of Akamai's Application Delivery Customers - Part 2

Last month, after spending the day at Akamai's Cambridge headquarters, I detailed how Akamai's application delivery product works, the types of content it delivers and the importance this product will play in Akamai's revenue for quarters to come. At the meeting, Akamai also gave me an insight into who some of their customers are that use the service which I highlight below. Some of these companies have been featured on the Akamai website in case studies, others haven't.

Of the numerous people I speak to about Akamai, their application delivery product is the one that is least understood in terms of how it works. Lets face it, understanding how content delivery works for video and static content is not difficult, but application delivery is still a new product and the market for the service is only just beginning. While Gartner says that the market for application acceleration products is expected to reach about $2.3 billion in end-user sales by 2009, Gartner does not break out that number to say where that revenue comes from. Hardware based products from the likes of Cisco and F5 for co-location based scenarios are very different than service based solutions like Akamai's. So while there is no way to truly know what the market size is for outsourced application delivery services, it is quickly growing. I'd be willing to bet that we see Akamai do close to $100 million in revenue this year for their application delivery product, up from $40 million last year.

When it comes to retail and e-commerce customers, I really don't need to go into many details on what the value is. Everyone knows that anything that makes e-commerce based searching, shopping carts and checkout faster is a no brainer and Akamai has numerous examples of such customers on their website. A variety of customers in the online advertising space use Akamai acceleration services to accelerate both the end user navigation and delivery of stock images and video to journalist and media outlets. Adify has developed a unique build your own network platform that comprises a hosted application (accessed via a portal) through which customers choose their ads and settings, along with a transactional system that streams ads to customers’ sites.

By using application delivery, Adify is able to serve its ads in less than half a second in North American and in less than one second to users in Europe—even though its data center is based in the US. While Adify looked at an application acceleration based co-location solution, Akamai says Adify would have had to spend close to $600,000 annually to build data centers around the world—and the costs would rise as the company factored in equipment and personnel.

Various customers leverage Akamai's acceleration services to accelerate support, B2B commerce applications to enterprise users and partners. While you read about many of these same companies using traditional Akamai services, like software downloads, etc... rarely are the other applications like supply chain management and extranet portals highlighted. Akamai says they have seen an increase in usage of their application acceleration technologies across industries that are new for the company.

Autodesk uses Akamai's acceleration services for its on-demand Buzzsaw collaborative project management application. Caterpillar uses the application acceleration service to move the configuration of industrial power generators and used equipment sales online, resulting in improved satisfaction for its worldwide dealer network. Phase Forward uses the acceleration services to optimize the Web connection between Phase Forward's hosted clinical trial electronic data capture solution and global trial sites.

While Akamai won't say exactly how many customers they have for application delivery services, they did say that they currently have hundreds of customers in the B2B application acceleration business. And as more companies need to speed up the delivery of all kinds of software, applications, transactions, portals and supply chain management systems, the market for outsourced application delivery is only just getting started. When the market starts to get a little bigger, I bet we'll see additional CDNs other than Akamai enter the market with service based solutions.

VeriSign Sells Kontiki CDN Business For $1 Million And Stake In New Company

VeriSign just filed its 8-K detailing the sale of the Kontiki business to a new entity, Kontiki Inc., which is a majority-owned subsidiary of MK Capital. "VeriSign received compensation of $1 million and 3,980,000 shares of the Purchaser's Series A Preferred Stock".

MK Capital is already closed for the day so I'm not able to ask them if they will say how many outstanding shares are in the new company and what percentage VeriSign owns. While the rumored price being talked about last month was $40 million, it's really hard to know what the deal is valued at without knowing how many outstanding shares there are and what the new Kontiki is valued at.

As I predicted back in December, I always expected that VeriSign would exit the CDN business once they began to contemplate whether or not they wanted to stay in the market with the service. Come April, it was already clear that a deal would be done to take them private.

The kontiki.com domain now goes to a website with details on the Kontiki acquisition and includes a new Kontiki logo I have never seen before. Don't know for sure if that will be their new logo and brand but I'm sure we'll find out soon enough.

NewTeeVee.com has posted an interview from today with Eric Armstrong, Kontiki's new president.

CDN Pricing: The Going Rate For Video Delivery

At the Streaming Media East show on Tuesday May 20th, I will be presenting my latest data in a session entitled "CDN Pricing: The Going Rate For Video Delivery".

With more CDN players in the market than ever before, trying to figure out what you should pay for delivering video can still be quite complex. This presentation will offer real pricing numbers from large, globally focused content delivery networks and show you the average going rate when you outsource delivery to a third party. The session will also cover some of the variables that determine the final price and how you should accurately compare the delivery services of one CDN to another, and it will give you a list of providers in the market today.

Have a topic or question for the session that you want to see addressed? Submit it in the comments section and I'll add it to the Q&A portion of the session.

Registration is still open and you can see all the various pricing packages, including a one-day ticket on our website. Six years since we took over the StreamingMedia.com business and we've still managed to keep the conference very affordable for everyone to attend. A full two-day conference ticket is only $895.

Online Video Mergers and Acquisitions: Wall Street's View

At the Streaming Media East show on Tuesday May 20th, we have a special session entitled "Mergers and Acquisitions: Wall Street's View". Acquisitions, partnerships, funding, and failures are all making headlines at an increasing rate.

At times it is difficult to understand why these events occur, what drives them, who is involved, and how they affect the rest of the industry. This panel of venture capitalists, equity research analysts, and others will discuss their views on the state of the markets, what gets them excited, what concerns them, and how it could impact the way you do business.

Confirmed speakers include:

• Moderator: Brian Essex, Analyst (formerly at Morgan Stanley)
• Colby Synesael, SVP, Equity Research, Telecom, Merriman Curhan Ford & Co.
• Kevin Ryan, Co-founder, Chairman, Panther Express
• Neil Squeira, Partner, General Catlyst Partners
• Ray Conley, CFA, Palo Alto Investors

Have a topic or question for any of the speakers you want to see addressed? Submit it in the comments section and we'll add it to the Q&A portion of the session.

Registration is still open and you can see all the various pricing packages, including a one-day ticket on our website. Six years since we took over the StreamingMedia.com business and we've still managed to keep the conference very affordable for everyone to attend. A full two-day conference ticket is only $895.

Financial Analysts: Get The Latest CDN Pricing and See Nearly 20 CDNs At Streaming Media East

If you're a financial analyst tasked with covering the content delivery market, you'll want to come to the Streaming Media East conference taking place at the Hilton hotel in NYC on May 20th and 21st. On Tuesday, May 20th, I'll be presenting my latest data on CDN pricing in a presentation entitled "CDN Pricing: The Going Rate For Video Delivery". On Wednesday May 20th, we'll also have a panel of analysts and investors on a special session entitled "Mergers and Acquisitions: Wall Street's View".

In addition, we'll have nearly 20 video delivery companies exhibiting and or speaking at the show including Akamai, AT&T, Abacast, BitTorrent, CDNetworks, Digital Fountain, EdgeCast, Highwinds, Ignite, Internap, Level 3, Limelight, Mirror Image, Move Networks, Panther Express, PowerStream, StreamTheWorld, VeriSign. Contact me if you want a special discount code for financial analysts.

Vusion, A New CDN/Video Platform Launches Today

This morning, Vusion, a company formerly known as Jittr Networks officially launched their offering to the market. While most people would compare Vusion to Move Networks, instead of using traditional CDNs like Move does, Vusion is also acting as the CDN and is doing all of the video delivery themselves. While the company is not yet willing to say how much money they raised, they have been in stealth mode for a few years and have taken at least a few million. With the launch, Vusion also announced that Island Def Jam Music Group is using the service, but it's hard to know if this is a regular paying customer, or more of customer who is getting some free services in exchange for Vusion being able to have content to showcase at launch.

Like Move, Vusion requires users to download software and is primarily going after high-bitrate and HD quality content with what they call their "patented WARP technology". Specifically going after content owners that require high-bitrate and HD delivery use to be something that newer CDNs in the market were touting as being a real differentiator. But today, the space is already quite crowded with numerous companies focusing specifically on high bitrate delivery. Move Networks, BitGravity, Digital Fountain, Grid Networks and now Vusion all seem to be competing for the same type of customer.

I had a long conversation with the Vusion folks a few weeks back and they came off as being smart and being very focused on the market they want to go after. But that alone won't guarantee success in today's  climate and with the continued influx of new providers on the market, it is getting really difficult to distinguish one provider from another. Many are really trying to focus on how the quality of their video is different, but to be honest, I can't even tell the difference most times. At some point, quality no longer becomes the deciding factor and it will come down to all of the other important elements that go into a quality service offering.

CDNs Vendors Raised Nearly $300 Million In Past 18 Months

In the past year and a half, more than 15 video delivery vendors, including P2P based providers, have raised almost $300 million in capital. CDNetworks, EdgeCast, Panther Express, Grid Networks, Highwinds, Velocix, Itiva, Move Networks, Pando Networks, Rinera, BitTorrent, ChinaCache, Rawflow and Oversi combined raised $282.85 million in 07' and 08'. And that number does not take into account other CDNs who have already raised money but have not yet announced details. In addition, there are also at least four providers, some new, some not, who are out in the market raising a new round.

When all is said and done, at the end of this year, I expect we'll have over $400 million raised by CDN vendors for 2007 and 2008. And with the market size for video delivery services in the U.S. being around $450 million in 2007, that's a lot of money raised as compared to the size of the market. I'm afraid that many investors are going to need the CDN market to grow a lot faster than it can in order for them to see the kinds of returns they are probably expecting.

CDNs Marketing Message Of "Cheaper Than Akamai" Not The Right Focus

Anyone who reads my blog knows that I have been saying for some time now that CDNs need to do a better job of delivering a clear, concise message to the market of who they are, what they offer and how they are different from other CDNs in the industry. With nearly 40 CDNs now in the space, it's never been more crucial for CDNs to stand apart from one another. Yet, with more new entrants, and more vendors all vying for much of the same business, few CDNs are really delivering any clear message at all. And don't take my word for it, ask customers. They still don't know the differences between vendors and in many cases, I don't think the vendors do either.

For starters, this whole sales/marketing pitch of "we're cheaper than Akamai" is pointless. Can someone please show me who isn't cheaper than Akamai? Enough already. If all it took was a CDN to say they are cheaper than Akamai to get business, then Akamai would be losing a lot of CDN business right now, which they aren't. So when nearly every CDN in the space is all saying the same thing, "we're cheaper than Akamai", how is that a marketing message? I hear so many CDNs lead with that and I get so many e-mails from CDNs highlighting that. Ok, great to mention to a customer, but when every other CDN is saying the same thing to that customer, how is that making you stand out? It's not. At this point, it would be unique if a CDN said we are more expensive than Akamai.

Why aren't CDNs leading with propositions that customers want to hear? I keep saying that customers are complaining that they want better reporting and better customer service, and while some CDNs do highlight that as part of their offering, they are still not leading with that as the message. I challenge every CDN, especially the new entrants over the past 12+ months to write down what their marketing message is. Then compare that to what you read on your competitors websites and in their press releases and don't be surprised when it's nearly identical or is extremely vague and uses all the same marketing buzz words. This is really easy, yet many companies are simply falling in with the crowd getting lost in buzz words and bad marketing speak.

For instance. Simply by operating a CDN you are NOT helping customers monetize content. CDNs keep saying they are helping customers monetize their content yet then when I ask them if they have any of the offerings that truly enable the monetization of content like transcoding, authentication, meta data management, syndication tools, custom APIs, analytics tied into advertising etc.... most of the CDNs don't offer any of these services as of yet. Simply delivering bits is not enabling monetization. Anyone can deliver bits. It's all of the other pieces of the content ecosystem that really drives the monetization of content. Some CDNs have a few of those pieces, but the majority of them don't.

Also, the marketing message that some CDNs are leading with calling themselves the third largest, or top-three CDN etc... is pointless. Who cares. Customers don't. You are not going to win business simply by saying that to a customer. And quite frankly, what is it based on? CDNetworks says they are a "top-three global CDN", with us all assuming that Akamai and Limelight are the number one and two. But Panther Express says they are the industry's third largest CDN and if we are basing this on revenue, then isn't Level 3 the third largest CDN considering they said they did $100 million in CDN revenue for Q1 of this year?  The bottom line, it does not matter who is number three or number four. None of that matters. Think about this. Do you want to be known as the number three CDN in the industry, or do you want to be known by customers as the number one CDN in the industry when it comes to customer service and reporting. It's a no brainer. We all know that in any industry, simply calling yourself a large player does not guarantee you success, long term viability or customers. Enron anyone? Size does not equal longevity.

When I started this blog it was to write about all things online video related and it seems all I have been doing is writing about CDNs for the past six months. I don't call out CDNs in any post to make them look bad and don't let my harsh criticisms of the CDN market suggest anything other than my love for wanting the CDN market to grow stronger and learn from its mistakes. We read a lot of great things about the CDN players but it's also important that as an industry, we don't allow ourselves to get to caught up in them and stay focused on what can be improved upon. Right now, I would say that the majority of CDN players really need to improve upon the story they tell of who they are, what they offer and how they are different from others in the market.

Three More CDNs Launch, Market Too Crowded

Amazingly, the number of new content delivery providers in the market continues to climb with three new CDNs launching in the past few weeks. The new entrants, which I will cover next week are Jittr Networks, SimpleCDN and EdgeStream. I think it's great that more companies are offering services in the market and that investors seem to have no qualms in pumping more cash into the industry. But we're now looking at over 40 content delivery networks and it's just too many. There is not enough business out there today to support so many providers, all offering different variations of the same service. On Monday I will be updating the list of CDNs that I track in the industry at www.cdnlist.com

I think choice is great and why not have as many choices as possible for any product or service? The problem being, in the long run, many of the CDNs are not going to be able to grow their revenue to meet their investors expectations. I keep hearing almost everyone say how they are going to give Akamai or Limelight a run for their money, but nearly all of the new CDNs, or those who have been around for a year or so, will do at most, 5-7% of Limelight's projected 2008 revenue. So far, only Level 3 is showing any signs of really growing their CDN revenue, based on the data they gave out last week during their earnings call.

That's not to say that all CDNs are trying to go after Limelight or Akamai or even want to become that big. A rare few of the CDNs make it clear that they don't want to be the size of Limelight and if they do $15 million this year they will be happy. Kudos to them for not giving into the market pressure of a new company thinking they have to launch to the market saying how they are going to take down the number two provider. What's wrong with being a smaller, profitable company not in the top three based on revenue? Nothing. Better you set expectations properly, your own and your investors, and survive for years to come in the market.

I hate to say it, but we're going to see a lot of cracks in the CDN sector starting 18 months from now. The market simply can't sustain so many vendors. If the market size was five or ten times what it is today, then all of these providers would have a shot, but it's not that big and won't be that big 18 months from now. For all the new CDNs, none of them seem to really have any idea what percentage of the market they think they can grab. While many of them say how they can take business from other providers, rarely do they say what percentage of the market they think they can get. I also don't hear from any of them what they think the market size is for CDN services in the U.S.

I'm all for new players in the market, giving everyone a fair chance, providing customers with more options and having the industry grow as a whole. But when you have so many providers in the space, all saying the same thing; we are cheaper than Akamai and/or our delivery is better quality, especially for high-bitrate video, then you can't expect to grow your business for the long run. And with more CDNs in stealth mode still waiting to launch, and telcos like AT&T and others taking more of an interest in getting into the CDN market, the number of providers for CDN services is going to take a real hit when the VC money starts to run out.

Two-Way Media Files Patent Suit Against Akamai, Limelight, AT&T

On April 11th, Colorado based Two-Way Media filed suit against Akamai, Limelight Networks and AT&T over a series of patents entitled "multicasting method and apparatus". (patent description below) While this is just one of many patent suits taking place in the content delivery sector, there are a few unique details about this one to watch. For starters, Two-Way Media first filed suit against AOL and after a successful Markman ruling in their favor, AOL settled out of court for an undisclosed amount. That by itself does not mean anything as it may have been easier for AOL to settle rather than pay legal costs, but the fact they settled after a ruling is a bad sign.

Even more interesting in my eyes is that the main patent, number 5778187 was filed in 1996 and was licensed by Two-Way Media to Cable & Wireless in the early days of the content delivery market. For those that remember, Sandpiper and Digital Island were some of the original CDNs that were acquired by Cable & Wireless. There is no way to know if Cable & Wireless licensed the patents because they felt they were valid or not, but the fact another CDN even licensed it makes this suit even more interesting.

Some may wonder why other CDNs are not mentioned in the suit and my guess is that it's the same reason most suits like this only name those showing a lot of revenue. Until a company is doing a certain level of revenue, there is no reason to really go after them. But you can expect that as more CDNs see revenue growth and the content delivery industry turns into a multi-billion dollar market over the years, CDNs are going to be inundated with patent suits. It's also interesting to note that once again, Level 3 seems to have a very clear strategy with regards to CDN patents and has no exposure to this patent either. Level 3 is covered under the original Cable & Wireless licensing deal with Two-Way Media through Level 3's acquisition of the SAVVIS content delivery business, which included their intellectual property.

Other CDNs aside from Level 3 could be in the cross hairs of companies like Two-Way Media, but at this time it's too early to know exactly who Two-Way Media and other patent holders may go after. And for those who say that some CDNs have no concern as they have made public statements saying they are not worried, what do you think they are going to say? No CDN is going to come out and tell Wall Street or investors, yes, this patent worries us. So unless a company comes out and address a specific patent and provides details as to why they feel they are not infringing, you really can't believe the corporate line of "we're not worried", unless of course you are Level 3.

Patent Abstract
A scalable architecture is disclosed for delivery of real-time information over a communications network. Embedded into the architecture is a control mechanism that provides for the management and administration of users who are to receive the real-time information. In the preferred embodiment, the information being delivered is high-quality audio. However, it could also be video, graphics, text or any other type of information that can be transmitted over a digital network. Preferably, there are multiple channels of information available simultaneously to be delivered to users, each channel consisting of an independent stream of information. A user chooses to tune in or tune out a particular channel, but does not choose the time at which the channel distributes its information. Advantageously, interactive (two-way) information can be incorporated into the system, multiple streams of information can be integrated for delivery to a user, and certain portions of the information being delivered can be tailored to the individual user.

Latest Update On Akamai/Limelight Patent Suit and Potential Limelight Sale

I have been getting a lot of requests for an update on the Akamai and Limelight patent suit, so here are the latest details I have. Last week, April 17th, Akamai filed a motion for permanent injunction against Limelight Networks. It's expected that a ruling on the injunction will come in the next few weeks and there is a pretty good chance that the motion will be granted. If that happens, Limelight is expected to file for and be granted a stay of that motion. Once that happens, it basically means that this suit will go on for at least another year, if not more, unless both parties come to an agreement, which I don't see happening.

While none of this is really news as this outcome has been expected since the jury ruling, I think that once all of the motions relating to the injunction are done, the two companies most interested in purchasing Limelight, AT&T and BT, could once again resume negotiations. In my eyes, it is just a matter of when Limelight will be acquired by a telco and not if. Shortly after the jury ruling, Limelight was offered a buyout for about $8 a share by a telco, which is a pretty good offering in my eyes. (I don't own any shares in Limelight or any other public company) Even at that price, Goldman, which owns just over 35 million shares last I checked, would still walk away with well over $100 million.

Limelight needs the resources of a larger company to really take their business to the next level and to accelerate revenue growth. They can still grow and maintain business as a stand alone company, but the resources of a larger company would give them a better shot in the market for the long run. Limelight is facing at least three patent suits by Akamai, Level 3 and Two-Way Media (more on Two-way later in the week) and at this rate, the lawsuits will take their toll on the company in terms of resources and focus, in addition to cash.

I hope for their sake and for the industry that Goldman isn't going to be too greedy and a deal can be worked out sooner rather than later. There is a huge gap between Akamai, Limelight and the number three CDN in the market in terms of revenue, and I think it's best for the industry to have as many top players as possible.

Amazon Slowly Turning Into A CDN For Video

About a year ago, I wrote a post about how content owners who wanted to deliver Flash streaming could use Amazon’s Elastic Compute Cloud (EC2) and Simple Storage Service (S3) along with a CDN to deliver streaming media based content. In the past few months, Amazon has made some new product announcements that over time, lead me to believe that more content owners are going to look to Amazon for video delivery needs, particularly those who are only delivering video via progressive download.

Last month, Amazon announced some new features with their cloud computing product including new functionality for Elastic IP Addresses and EC2 Availability Zones. Simply put, Elastic IP allows you to associate static IP addresses with a unique EC2 and Availability Zones lets you deploy your apps into different regions. Amazon is effectively allowing content owners to replicate apps in different data centers and in different regions, thereby also protecting them from outages. While only a limited number of U.S. based locations are available today, more locations, including those outside the U.S. will be added in the months ahead.

When the new locations are added, then this offering is something to really watch. Amazon is offering faster performance between servers in the same EC2 zones and one would expect they would then offer some level of performace guarantee across all zones. When this happens, they essentially become a content delivery network. We're already starting to see some companies like Digital Fountain build an entirely new CDN offering around Amazon Web Services, and there are more to come.

It's also interesting to see how much of the internal workings of Amazon's cloud computing service they are willing to share with developers and everyone else. Most delivery networks are so closed and Amazon has wisely taken a different approach, primarily due to the size of the customer using their service. Wired has a great article from yesterday that talks about Amazon's cloud computing service and the best line in it is the response from Amazon's CEO when asked about cloud computing becoming a commitized service. "Commodity businesses don't scare us," he says. "We're experts at them. We've never had 35 or 40 percent margins like most tech companies."

While Amazon's cloud computing service will have more of an impact over time, especially as it evolves into more of a traditional CDN offering, it still won't be a big disruptor to the major CDNs like Akamai and others. For some customers Amazon could be a viable option with reliable and cheap services. But for many content owners, and in particularly those who have video, their needs are getting more complex each year as they struggle not to deliver bits, but rather solve the entire workflow problems associated with ingestion, transcoding, authentication, meta data, content management, syndication, tracking and reporting and traffic analysis.

That being said, anyone as smart and as big as Amazon is one to watch.

A Detailed Look At Akamai's Application Delivery Product - Part 1

In my day long meeting at Akamai's HQ a few weeks ago, one of the products we spent a great deal of time talking about is their application delivery service. Of the numerous people I speak to about Akamai, their application delivery product is the one that is least understood in terms of how it works, the type of content that is delivered and the types of customers that use it. It is also the product that I receive the most questions about in terms of the size of the market today and what Akamai's potential market growth opportunity is down the line. I'll cover all of that here in part one and give real customer examples in part two next week.

Traditionally, over the past fifteen years, I have only covered products and services that have included some form of video. But moving forward, application delivery is a product and industry I am going to start to track very closely as it is a market that is just starting out, yet over time will become very important to some of the content delivery networks in the industry. While there is no way to know how big the market is today and what the market will be next year, Akamai has publicly stated that their application delivery product had a run rate of $40 million for 2007.

Through the acquisition of Netli, Akamai is well poised to offer a product that they have been developing for at least a year and have real customers using the product today. When other companies begin to go look at and develop an app product, Akamai is already going to be ahead of them in development, real customer feedback and revenue. While I don't think application delivery is going to make a huge impact on Akamai's revenue in 2008, I do predict that come Q4 of this year and moving into next year, Akamai's application delivery product will be one the fastest growing products in the company.

After talking to customers and seeing how content will need to be delivered down the road, my personal opinion is that Akamai's application delivery product is one of the most underestimated products in their portfolio in terms of revenue growth, for multiple reasons. For starters, the market for these services is just starting out and already, Akamai is considered the only game in town for this service based on an outsourced model. I don't know of any other CDN who offers application delivery today and while some vendors offer hardware based application delivery or acceleration products, I'll cover later why those are not a real threat to Akamai's service. And as the only CDN currently offering the service that I know of, application delivery is a fundamental building block that lets Akamai service their current customer’s needs, while exploring new markets.

So how exactly does application delivery work and what types of content is delivered through the service? For starters, there are a lot of similar terms used to describe these products and the market and the two most commonly used are application delivery, and application acceleration. While the terms are pretty much interchangeable, what is very different, however, is the approach to application acceleration. For example, a network managed service approach such as Akamai's in-contrast to an appliance-based approach such as Cisco's.

From a high level, the problem that application acceleration solves is around content that cannot be cached at the edge, and therefore must be accessed at the content owners’ origin. This type of content can be as simple as a base page that calls media or personalized content that cannot be cached, or enterprise data coming from an SAP application and an associated database. In the case of consumer applications, application acceleration drives more page views and video views, and in the case of enterprise applications it enables application adoption and usage.  Because the content cannot be cached, the delivery of that content must be accelerated due to Internet protocol inefficiencies.

For example, users type in www.danrayburn.com and are sent to an Akamai edge server 5-10 milliseconds away, where their request is accelerated across the Internet to an Akamai edge server close to the origin, where the request is past on. The origin fulfills the request and responds to the Akamai server closest to it and it is again accelerated back over the Internet to the user through the local Akamai server for delivery. To accomplish application acceleration you must control both ends of the network connection, the one close to end users and the one close to the application/content owner's origin.

In order for Akamai to accomplish this, there are three main network components to their application acceleration architecture. An Akamai edge server region close to the end user and an Akamai edge server region close to their customer’s origin infrastructure. In both cases, the goal is to get within 5 to 10 milliseconds away from both the origin and user, thereby essentially creating a bi-nodal overlay network over the public Internet. In addition, application traffic is bi-directional opposed to uni-directional like most traditional CDN traffic so optimizations need to happen both ways. From what Akamai tells me, this also illustrates the importance of a large distributed network for application acceleration and to them, highlights why CDN vendors with a large data center approach will have a fundamentally difficult time entering this space.

So exactly what kind of content can take advantage of application delivery? For enterprise employees, they come into contact with many of types of web applications on a daily basis including expense management systems such as Oracle, contact management systems like Siebel or Salesforce.com, learning management systems and even web-based e-mail. For industry specific applications you can look at things like ad campaign management tools such as DoubleClick DART for online publishers and advertising agencies, supplier/distributor inventory management apps, and project management software like Autodesk.

On the consumer side, they are also heavy users of web apps including online commerce, doing your taxes through an online site like H&R Block, booking online travel with expedia.com and facilitating user generated media for online photo sharing and video sharing. An example of this would be Adobe's recently launched online version of Photoshop (Express). Akamai’s application acceleration technology also works with a wide range of application architectures such as service oriented architecture (SOA) applications where the communication is machine to machine with no browser rendering and Web 2.0 AJAX/FLEX class applications.

Another question people constantly ask me is how Akamai's application delivery service is priced and what it costs. I'm not sure yet of the cost as I need to collect more data from customers before I can talk real numbers. But I do know that the service is charged as a monthly subscription per functional application and that Akamai stated that most of their application delivery contracts are 24 months in length and include performance SLAs.

Some will say that hardware and software based application delivery products like those offered by Cisco, Citrix and Juniper will compete with Akamai for those who want to deploy it themselves. For a small percentage of customers, that is true, just like it is for those who may want to do their own video hosting or content delivery. But for the majority of customers who need application delivery, it isn't practical or in most cases even possible to put an appliance close to everywhere an employee, business partner and customer can access a web browser. By controlling both ends of the network (both near the data-center AND near application users), the optimizations Akamai provides to improve application availability and response times extend far beyond those which are limited to a footprint within the data-center.

Next week in part two, I will give examples of who some of Akamai's application delivery customers are and talk about the different types of content and applications they are delivering. Please add my RSS feed to your reader to get the new post as soon as it is up.

Note: As I have said before, I have never bought, sold or traded any stock in ANY public company, ever.

Akamai Confirms No Outage Of Their Web Acceleration Network

I've been getting a lot of calls all day regarding the coverage put out by Jefferies & Company this morning which stated among others things that Akamai's web acceleration outage "was down for a significant amount of time in Q1." Akamai has confirmed to me that this is not the case and the web app network has not been down at any time in Q1.

Move Networks Rasies C Round Totaling $67.9, Not $91.3 Million

Move Networks announced today that it has raised $46 million in a Series C round led by Benchmark Capital which includes Cisco and Comcast and Televisa, as well as previous investors Steamboat Ventures and Hummer Winblad Venture Partners.

While many sites, including TechCrunch, are reporting that Move Networks has raised $91.3 million to date, some bloggers are doing the wrong math. Move raised $11.3 million in 06', $10.0 million in 07' and $46 million in 08'. While many announced that Move had raised $34 million back in Q4 of 2007, this was not the case. Move raised no money in Q4 of last year.

The $67.9 million is still a large number, but a lot less than over $90 million. Move is an interesting company to watch. Last month I had the opportunity to sit down with Move's CEO John Edwards and was able to get a really great insight into their current business and details on what Move is working on with Microsoft. There are some really interesting things that Move is thinking about in terms of where content delivery is going, how to scale it and what the broadcasters are going to require. We should see some very interesting announcements from Move later in the year.

Limelight Launches New Website, Includes New Focus On Enterprise and Government

Cruising some websites on Sunday I noticed that Limelight Networks launched a new website over the weekend. The new site contains a lot of video and has a lot more defined message around Limelight's core product offerings as well as their new slogan "deliver brilliance". The biggest piece of new content is the focus Limelight is placing on the ecosystem. A new section on their site talks to all of their partners for web development, transcoding, content management, ad insertion and various other solutions in the stack.

I've mentioned before that to me, Limelight was not previously doing a good job of really letting customers and the market know that they deliver more than just video. The new website address this by giving details on the types of content they deliver and how it applies to specific business problems for specific verticals. They also talk a lot more to object delivery, website acceleration, document distribution, online software fulfillment and online game distribution.

Additionally, Limelight has added new verticals on their site including corporate (enterprise) and government. Previously, Limelight had only focused on the media and entertainment market so the addition of enterprise and government is a new focus and potentially a new revenue stream for the company, if they can show some traction with customers in those new industries. It will be interesting to hear if Limelight has newly dedicated account managers to focus solely on government business, a segment of the market that Akamai has ruled to date, and whether or not Limelight is currently or will soon be a certified GSA vendor.

It's good to see Limelight begin to deliver a lot more messaging to the industry and I expect they will soon follow this up with specific messaging and new data for Wall Street. They know it is desperately needed and I expect they will address the need shortly. With most of the trial motions expected to be over within the next few weeks, I think we'll begin to hear a lot more from the company in regards to customers and product announcements. In addition, it makes the acquisition talks that are talking place more relevant since some of the questions around Limelight's appeal will be clearer. While I'd still like to see Level 3 make the acquisition, if Limelight gets acquired at all it's going to come from a telco like AT&T or BT. I'd be willing to bet anyone a steak dinner it won't be Akamai or Microsoft.

Disclaimer: Content delivery networks Limelight, Akamai, Internap, Level 3, EdgeCast, Ignite Technologies and NaviSite have all sponsored the blog or are current sponsors.

Level 3 Adds IBM's CDN Patents to Its Portfolio

I originally wrote this article last month which appeared on the GigaOm.com website.

Over the past few weeks, an ongoing patent dispute has meant most of the focus in the content delivery market has been on Akamai and Limelight. In the meantime, however, Level 3 has been quietly expanding its CDN services, adding capacity to its network and signing up one large customer after another. In fact, when it comes to CDN patents, Level 3 is the one to watch. In addition to the 50 patents pertaining to content delivery it has pending, Level 3 owns over 80 patents pertaining to content delivery and streaming media technology — including 20 it recently bought from IBM.

Level 3 and IBM last month said they’d signed a long-term patent cross-licensing deal whereby Level 3 gets licenses to 42,000 pending and issued patents from IBM and IBM gets licenses for more than 850 pending and issues patents from Level 3. What was not disclosed was that Level 3 also purchased 20 patents pertaining specifically to content delivery and streaming technology.

I’m about to put the finishing touches on a story detailing why Level 3 is not affected by Akamai’s 703 patent, so I’ve been doing a lot of research on CDN patents lately. Sifting through prior court rulings and patent filings, I noticed that the USPTO web site lists IBM as the owner of 20 patents pertaining to CDN and streaming. It also claims they’re in the process of being transferred over to Level 3. I contacted Level 3 and they confirmed this was indeed true.

Most of the patents date back to ‘97 or ‘98 and concern the way video, multimedia or digital content is delivered. Some of the patents have to do with encoding and processing, encryption, load balancing and methods for caching. There are also numerous references peppered throughout the patents regarding the best methods for routing traffic, how the media servers load balance the traffic and the effect that has on the end user experience.

While I still need to read the fine print of all 20 patents before I will truly understand the effect they may have on others in the industry, it’s already clear that Akamai isn’t the CDN its competitors should be worried about. Level 3 when they entered the market made no bones about the fact that for them or any other CDN to be successful over the long term, they’d have to have the intellectual property necessary to protect their investment in the CDN market. And with the acquisition of the SAVVIS assets — including the Sandpiper patent, which predates Akamai’s 703 patent — Level 3 is clearly in the driver’s seat.

Level 3 seems to be taking the same tactic as Akamai, to date filing suit against the only company they view as a competitor — also Limelight. And while some of the other existing CDNs could one day become competitors too, right now none of them are turning in more than 20 percent of Limelight’s total 2007 U.S. revenue. There is a huge revenue gap between the No. 2 CDN, Limelight (Akamai is No. 1), and No. 3. That gap needs to shrink and these smaller players need to start posting CDN-based revenue to the tune of $50 million a year before they will become worthy of concern.

Some don’t give Level 3 a chance. They say Level 3 has too much debt, is having problems integrating some of its acquisitions, or simply maintain that since it’s a telco, it won’t understand content delivery, anyway. But looking past the debt (which most companies have), and the mistakes other telcos made in the past (Qwest and MCI tried and failed to operate their own CDNs), Level 3 has a real shot at dominating the content delivery market for years to come. And given their massive portfolio of content delivery patents, if I was another CDN whose goal it was to give Limelight a run for their money, I’d be most worried about Level 3.

The numbers of the patents being transferred to Level 3 are: 5996025, 6189039, 6195680, 6226618, 6263313, 6272566, 6398245, 6418421, 6460082, 6463454, 6463508, 6587837, 6763377, 6859791, 6963910, 7103564, 7110984, 7117259, 7188085 and 7206748.

Highlights Of My Day In Cambridge With Akamai

About two weeks ago, Akamai invited me to spend the day with them in Cambridge to allow me to get an better insight into their business and give me the opportunity to ask management and others more about the market, pricing, application delivery and a host of various other topics. They nicely gave me access to over a dozen individuals including senior management in sales, marketing, engineering, product development, investor relations and their CTO.

Added Tuesday April 8th: Since I am being asked so many of the same questions I should put it on record that Akamai did not pay for my trip to Cambridge, I paid for my own plane ticket. And no, Akamai did not see this blog post before it went live and have to "approve it" as some are asking. And as I have said before, I have never bought, sold or traded any stock in ANY public company, ever.

While some of what we discussed was off the record, there is a lot that I can talk about relating to some new product functionality, sales and marketing topics and a lot about the market dynamics, trends and my take on what the opportunity is for Akamai in the market. With so much to cover in detail, I won't be able to cover it all in one post. I will give a run down of the highlights here and then over the next two weeks I will follow up with specific posts about their application delivery product, their StreamOS content management system, customer service, analytics, some details about the network and I will post their answers to some of the questions that readers sent in. Akamai is nicely working with me on the future posts to give me customer names, specific examples of how they are using the services and examples we can see in action. There will be more to come on that later this week.

After spending the day with Akamai, there were a couple of really key high-level feelings I walked away with. For starters, Akamai has a very_clear understanding of what customers want in the market across all of their product lines. When I was getting new product demos and talking about new functionality for their services, at no time was Akamai guessing on what they think customers wanted. It was very clear that they spend a lot of time talking with their customers, getting feedback, going through review sessions and finding out what they can do to help their customers grow. For every new product or feature they showed me, they also included examples of real customers using the service and talked about how it allowed the content owner to grow their business or gave them more control applying business rules around their content. Many companies I speak to in the CDN space talk about new products and services they are working on but many times I get the sense that they don't know exactly what their current customers future needs are. While Akamai is clearly working on what customers need today, announcements they will make throughout the year will showcase that they are also deploying products and services customers will need two and three quarters from now. The biggest thing I saw from Akamai was that they have a very clear understanding of the market they are in.

Another key takeaway for me was that Akamai realizes that as the leader in the space, they need to do a better job of communication data to Wall Street and to investors and need to spend more time to educate customers. That being said, Akamai's is not saying that they are now going to provide every piece of data a financial analyst wants, but I gave them some examples of how they could put out more specific data to the market while at the same time protecting their customers, and they are open to the idea. They know as the leader in the space they need to step forward and do a better job of showing the entire industry how this market is growing.

They understand that analysts are saying that they want to buy more stock in the company but need more data to be able to do that and they said they would provide more breakout on their business at their next analyst day. While I don't deal with Akamai on a day to day basis as it pertains to their P&L, I do deal with many money managers daily and hear the kinds of questions they want answered. I think that over time you will see Akamai be more open to disclosing more data on their business.

Tied closely into the data discussions is the subject of Akamai's pricing and the pricing trends in general which we covered in detail. I gave Akamai my feedback on their pricing, what I am seeing in the market and how they compare to other vendors specifically for video delivery. This was an interesting discussion as I learned that in many cases, Akamai may not be the right fit for customers who want commoditized services. When I gave Akamai examples of deals I have seen in the market and showed them that they were two or three times higher than competitors, they were not surprised. They made it clear that if a customer does not care about being able to use multiple services, doe not care about good analytics (not just reporting), does not require a good SLA, not concerned with geographic reach etc... then that customer is probably not a good fit for Akamai and they should go somewhere else at a lower price.

If there was one thing I walked away from after this meeting it is that Akamai is laser focused on customers who have business problems, need to apply their own business rules around their content, need very detailed analytics, need geographic reach, need multiple services and are trying to solve the entire ecosystem problem from creation to distribution. While they will gladly take customers who want the simple task of pushing bits, that's not who they are going after. For the most part, that is why the whole "pricing war" people talked about last year was completely overrated. Yes, Akamai may have to compete harder on price for those specific deals where the customer just wants to just push a lot of bits. But for customers who are looking for much more than that and also need additional services like application delivery, pricing is not the problem.

While I have always covered content delivery for video very closely, application delivery is now something that I am going to also focus on. In my eyes the biggest market opportunity for Akamai going forward is their application delivery product. While it is a market that is just starting out, I think that in two or three quarters it will become a very big opportunity and I think it is the most under-estimated product in Akamai's portfolio. I'll have more on that later in the week along with details on Akamai's StreamOS product, the content management system that was acquired in the Nine System acquisition. From the product I saw in action, which Akamai has been working on for the past year since the acquisition, and will have announcements about shortly, I have not seen another CDN that has a solution that can do even 25% of what StreamOS does. And as more content owners start to become more sophisticated in regards to the kind of transcoding, tracking, analyzing and monetizing they are going to need, StreamOS will quickly become a revenue center for Akamai.

Overall, I didn't see or hear anything from Akamai that gives me any indication that they are currently losing market share. Yes, for video delivery they have some competition in the market, but most of those competitors are still very small and don't have a wide product portfolio. And when it comes to doing more than just pushing video bits, Akamai clearly has a handle on the market today and more importantly the solutions that will be needed by these customers a few quarters from now.

I'll have more posts about my visit with Akamai shortly, so please add my RSS feed to your reader to get the new posts as soon as they are updated.

P2P Vendors Struggling, CDNs Not Interested In Adopting

About six months ago, I was really convinced that P2P might start to get some traction in the new year and that we would see some content owners commit to the technology. But aside from the Pando Networks and NBC deal, as we enter Q2 not much has transpired from the end of last year. P2P networks are still talking up a storm in every interview I read about how much cheaper their pricing is as compared to CDNs and leading with price as the major value proposition. Most P2P companies are still missing the point that cost is not the only thing customers care about and if it was, then P2P networks would have a ton of business by now, which they don't.

Some are going to say that the announcements we have seen between P2P providers and the likes of Comcast and Verizon are a big deal, but those announcements are more for press than anything else. They are not creating any revenue for the P2P providers in the market, customers are testing the waters with P2P but not committing and most P2P providers are still all using the same marketing message and not distinguishing themselves from one provider to another.

Last year, I thought the biggest push that P2P might get would be from the content delivery networks. As much as some P2P providers think they compete with them, the fact is that P2P providers can't survive on their own. Around Q3 of last year, many of the major CDNs were investigating the purchase of P2P networks, white labeling a P2P based service, or re-selling one of the many existing P2P solutions on the market. Since that time however, the major CDNs have changed their minds and have done almost nothing with P2P. Limelight, Level 3, and Akamai all have no real interest in delivering a P2P based offering to the market at this time. They don't need the product today, the market opportunity is not big enough and even for a company like Akamai who acquired a P2P based company, you wont see a P2P based product from them anytime soon. Internap announced a deal to integrate Pando Networks P2P solution into their CDN, which was the first non-hybrid CDN to do such a deal, but since that announcement five months ago we have not heard of any customer deployments.

From what I can tell in the market, P2P is not as big of a story as it was at the end of last year. The topic has cooled off a bit except when its being discussed as it pertains to carriers blocking or filtering of P2P based traffic on their networks. Aside from that, customers are not asking me about P2P and 55.2% of those we surveyed about their content delivery needs said they did not plan to even look at P2P as a delivery solution for 2008. I hate to see how hard it is for P2P vendors in the market as I believe that the technology really does provide value to certain customers and with certain kinds of content. But until the CDNs start to offer P2P as just another one of the many ways they can deliver content, I don't see P2P getting any real traction anytime soon.

Digital Fountain Launches Beta Site For New CDN Offering

Digital Fountain's new streaming video CDN is now live with the recent launch of its DF Splash Beta website. The new website gives an overview of their CDN offering, provides live demos of their solution and is open for visitors to join their beta program to add streaming video capabilities to their own web sites. One temporary draw back right now is that the demo requires you to download a plugin that only works with XP but I'm being told that will only be for a few weeks longer. Since I'm on a Mac, I can't say what the quality looks like so I hope others will take a look and post what they think about it in the comments section.

Details On My Trip To Akamai Coming Soon

I appreciate all of the calls and e-mails I am getting from those who want to know how my trip to Akamai week last went. Spending a whole day in Cambridge gave me a great insight into Akamai's business and they were really open and helpful in showing me many of the things I wanted to see. I have quite a lot to write about and hope to have my first post up later today or tomorrow.

Give Feedback On Your Reporting Needs: Earn A $100 Amazon Gift Certificate

Following up on my post about customers needing better reporting and analytics, Skytide, a sponsor of this blog, is interested in doing 30 minute calls with customers to get their feedback on what additional metrics and features content owners want to see in the market. They would like to hear the pain points customers are having today and they are offering a $100 Amazon gift certificate as compensation for your time.

If you are interested in giving some feedback about your reporting needs and what is missing from the market today, they'd love to speak to you. Those interested can contact Lynn Anderson directly at Skytide.

Reporting And Analytics Number One Complaint Of CDN Customers

Of the 1000+ customers who took our CDN survey and were asked "What value added services are you willing to pay a premium price for", over 75% of them said something having to do with better reporting and analytics with the most common answer being something along the lines of "Better reporting - and did I mention better reporting!!!"

So it will come as no surprise that analytics and reporting was also the number one answer when we asked "In your opinion, what is the one thing your CDN needs to improve on". While most CDNs I speak to know how big of a deal reporting is, very few seem to be taking the issue seriously. Much of what customers are getting today in terms of data is very basic and is at most, raw data that is presented to look pretty but with no analytics to tell them what the data means. I know that some CDNs will say that reporting and analytics is hard as the log files they are dealing with are so big and that many customers have custom reporting needs. That is true, but there should be some base line minimums, and when many CDNs reporting interface can't even tell a customer during a live event how many simultaneous streams they are doing, the basics are missing.

Looking over the survey data, here were some of the most common comments from customers:

• real-time reporting for live events
• analytics reporting is technical only, not enough marketing oriented
• reporting based on geographic region
• reporting based on sub-accounts
• monitoring/analytics APIs
• self service reporting tools have a terrible interface
• access to geographical based reporting, such as the map in Google analytics to determine local advertising impact
• analytics for Flash content
• providing metrics in a timely fashion
• looking at how long each video is played on average, are people dropping half way through?
• Analytics a little bit limited, e.g. can't choose custom time frame (3 day for instance), also the reporting does not translate UTC to our local time
• Reporting over longer periods of time (currently only 6 months)
• detailed user analysis (who watched what for how long from where)
• an API for accessing and displaying the tracking data, so that I could create my own "dashboard" to show real time stats
• I would like an API where I can get raw metrics to feed into our internal report structure. We use several CDN's and each has their own reports. We spend too much time translating data to produce a single comprehensive report.
• reporting and analytics and the ability to parse it out by stream/customer
• push default reports I want to me, rather than me have go get them
• views per day, views per geographic location, length of each view then an aggregate % per day

From all the customers I speak to, the feedback I have heard is that Akamai and EdgeCast have the best reporting products in the market. That's not to say that others may not also have a good functioning products, but those two are the ones I hear the most compliments about from customers. I think every CDN in the business should have a real reporting account on their homepage that anyone can log right into so that you can see first hand what their reporting and analytics package looks like. Too many times customers tell me that when they ask about reporting, most CDNs send them a product sheet with some screen grabs of the interface.

Reporting, and more importantly analytics, needs to get better a lot faster. Customers have to be able to show the value in these services, measure their success and justify why they should spend more money to deliver more content. While I see many of the CDNs all going to the market with the same message about performance, reliability, high-quality etc.... most of which don't really mean anything to a customer anymore anyway, why not create a really good analytics package and use that as your go to market message? It would stand out from the rest of the commodity marketing terms CDNs use, would resonate well with customers and is a functionality of the service all customers need.

VeriSign To Sell Kontiki P2P Division: Rumored Price Around $40 Million

VeriSign is expected to sell its Kontiki P2P division this month to a group that has been previously involved in the company. Barring any last minute problems, the deal should be closed and announced in the next few weeks. Whether or not they will keep the Kontiki branding remains to be seen but they are expected to re-focus their offering to target the enterprise market. While VeriSign won't comment on the sale, the "rumored" buy back price people are circulating in the industry is around $40 million, which would be about 3x revenue.

Join LinkedIn Groups For CDN, Webcasting, P2P and Adobe FMS

I've been asked to spread the word about groups on LinkedIn for professionals in the content delivery industry, webcasting sales professionals and Flash Media Server developers. While the focus of each group is a bit different, all of them are using LinkedIn with the purpose of exchanging knowledge, experience and contacts.

I have not joined any of the groups myself as of yet, but will be doing so shortly. To sign up for any of these groups, follow these links: CDN Industry Group, Flash Media Server Developers Group, Webcasting Sales Professionals.

Added Group: Legitimate P2P

If you know of other LinkedIn groups that are relevant to the online video industry, please post them in the comments section and I will add them to the list.

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.

CDNs Getting Ready To Benefit From Higher Bitrate Content

Of all the calls I do with analysts, money managers and others tracking the content delivery market, rarely do those I speak with ask about video birates. For me, the growth of the content delivery market and the very success of the CDNs relies heavily on the trend we see developing for increased bitrates. Most think CDNs can only grow their business by signing new customers or growing their existing customer base. But increased video birates has a huge affect on any CDNs bottom line and 2008 is the year that the bitrates of old finally turn the corner.

Five years ago, the average broadband video stream was encoded at 300Kbps. Last year, 300Kbps was still the norm but we saw many moving to higher quality. Within the last six months, the average broadband video is now at least 500Kbps. We have all seen bigger window sizes, better frame rates and all of that comes from increasing the bitrate. In jus