Announcing New Content Delivery Summit, The Infrastructure Of Online Video

  I am excited to announce that StreamingMedia.com will be launching a new one-day summit in May 2009 that will focus on the infrastructure of online video. Held in conjunction with the Streaming Media East show, my goal is to bring together content owners, infrastructure providers, analysts, and Wall Street to discuss the business and technology challenges of delivering video online. (www.ContentDeliverySummit.com)

While competition is fierce amongst CDN vendors, there is still an opportunity for all vendors and customers to help push the market forward with information sharing, best practices and debates about the most important business and technology topics relevant to the growth of this industry. This is where the Content Delivery Summit comes in.

The majority of speakers at the summit will be customers, those who actually buy CDN services and can share with us what impact video delivery is having on their business today and what kind of growth they expect in the future. We'll have two tracks with roughly twelve sessions, four keynote presenters and roughly sixty total speakers and will be having multiple networking functions during and after the event. 

To help enable every sponsor and attendee to get the most out of the summit, I will be personally contacting every single pre-registered attendee before the event and helping them to arrange meetings with others at the show. I am going to spend a lot of time and effort to connect as many customers, vendors, analysts, and Wall Street executives with one another as possible and really show attendees and sponsors the value of attending. We're also going to be giving away free analyst research on the CDN industry and other goodies to all attendees.

We know that 2009 will be a tough year for many in the industry so when registration opens, we're going to keep the cost to attend very low and will be offering discounts and other special pricing to enable as many to attend as possible. We're also keeping sponsorship packages for vendors as low as possible with a silver sponsorship only costing $2k. We really want this to be the place where the CDN industry can come together and help demonstrate how big a role video over IP is going to play.

While the summit website is now officially live, we'll be adding sponsors, keynote speakers and session topics over the next few weeks.

If you are interested in speaking at the summit, visit the website and get your speaking request in now! The call for speakers closes in three weeks and there are a limited number of speaking spots. Roughly a third of the spots have already been filled with CDN customers.

If you are interested in moderating a session at the show, have a topic you want to see discussed or think there is a role you can play in the summit, call me. Within three weeks I expect the program to be filled and nearly complete, so don't hesitate and call me immediately (917-523-4562) if you want to help plan any of the agenda. I am still looking for experienced moderators who can help organize a discussion on CDN topics pertaining to business, technology or financing.

I'll be posting many updates to the website and my blog over the next few weeks as we announce more details of the summit and look to publish the entire agenda by the end of January.

While 2009 marks the 14th year since some of the first CDNs starting delivering video on the web, I think there is a lot more that the CDN industry needs to be doing as a collective group, working together to share information and help grow the market faster. If you have any ideas on how the Content Delivery Summit can help to achieve this, I welcome and any all suggestions and answer my phone 24 hours a day, 7 days a week. I'd love to hear from you. (917-523-4562)

Review: Highwinds CDN Reporting System "StrikeTracker" Loaded With Functionality

Anyone who has read my blog long enough knows that I am always saying that content delivery networks need to offer a lot more functionality in their reporting and analytic packages. Earlier in the year, in a StreamingMedia.com survey of over 1,000 customers, more than 75% of them said reporting and analytics was the number one complaint they had with their current CDN. In April of this year, I posted the top twenty customer requests on ways content delivery networks could improve their offering.

Seeing a real demand in the market, content delivery network Highwinds has been working for the past year on improving their web based reporting product and offering all of the functionality that customers asked for in the survey. In that time, I've had the ability to watch Highwinds product continue to evolve and have been able to get a few in-person demos along the way. To date, their reporting package is one of the best solutions I have seen from any of the CDNs in the market.

Highwinds reporting system, called StrikeTracker, enables customers to get real-time analytics, self-service live event provisioning and enable policy-based content-access protection, all via a web based dashboard. They currently offer multiple metrics for live events, something many CDNs don't have, and soon will give customers the ability to watch individual viewers signing on/dropping off of live events. All customer data is updated typically in 30 seconds or less so it provides actionable information during a promotion or campaign, not just after it has ended. While other CDNs offer near real-time reporting, typically it is at intervals of ten minutes or more.

One of the great things you notice right away when using StrikeTracker is that it was built in Adobe Flex, with a major focus placed on usability and providing a graphically-rich, yet streamlined interface that quickly highlights key statistical information. And because to date, Highwinds has primarily gone after resellers, they have spent a lot of time making sure the system provides reporting for sub-accounts and is viewable through APIs in the StrikeTracker console. Their sub-account reporting and billing data is also rolled up through a hierarchy of parent accounts and can be viewed by sub-account or as an aggregate for all levels.

Another really nice feature of StrikeTracker is that the system will go out to 24 months at the monthly roll-up level today. Many CDNs tell their customers that they don't hold onto raw logs for longer than six or twelve months and I hear from many customers all the time who are forced to have to download and save their raw logs every few months or risk them being deleted.

One thing I am always telling CDNs is that they should have a login to their reporting system, on their home page that anyone can demo at any time. It's not enough for a vendor to send a customer a PDF with a screen shot of their system or a document that gives a high-level overview. If you stand behind your reporting, then let any potential customer login and see the real functionality, without saying you can't because you don't wan your competitors to know what you are doing. To date, I don't know of any CDN that does this, yet it's the number one request of customers. Even when a CDN is pitching a customer on their services, many times they still don't give the potential customer a login to get hands on with the system which should make any potential customer wary.

While I asked Highwinds to give me a user name and password that anyone could use to login and see the system themselves, they said only one person can use the same user name and password at a time. So while Highwinds is not able to provide an account that can be shared by a large group of people, they are willing to provide a unique login and user ID to anyone who is interested so they can see all the functionality in real-time. You can contact Mark at Highwinds directly and he'll be happy to set you up with an account. Highwinds also has a seven minute demo video of their StrikeTracker system which gives you a really overview of all the functionality.

While I took a few dozen screen shots of the system, it's easier for you to get an account to see it in person or watch the demo video for an overview. I think it's great to see Highwinds addressing a major concern of customers in today's market and it is really important for CDNs to remember that customers won't spend more money on services if they aren't provided with the tools they need to measure their success.

Mobile Carriers and Content Owners Won't Give Out Usage Data On Mobile Video

For all the talk by the major mobile carriers and content owners of how "successful" their mobile video offerings are, none of them that I speak to are willing to give out any usage data that we can use to truly judge their "success". Last week, I asked Sprint for any data pertaining to the full-length NFL games they have started broadcasting to handsets but was told they didn't have any data to share, primarily because they don't want to tip off the competition.

MediaFLO, who's service is offered in a partnership with AT&T and Verizon, won't say how many users it has for the service. And Verizon, which in September added more full-length shows to their VCast offering, won't say how many users they have, how many hours of content has been viewed or even how many pieces of content have been consumed.

Of course that has not stopped any of the carriers from proclaiming their services as being, and I quote, "widely successful, "having tremendous growth" and giving out completely generic and useless data like "viewership increased by 100%". And while I have seen some research reports state the size of the mobile video market in the U.S. and what it is expected to grow to in the future, I can't seem to get research houses to say where those numbers come from. What is the data behind these projections? Is there any or is it a complete guess?

I am constantly being pitched by various carriers in the space who want the media to talk about how "successful" their mobile video offerings are, yet they give us no data at all to make their case. How are we suppose to talk about their video offerings in the market when we have no usage data, penetration rates, consumption numbers, and trending statistics? So why won't the mobile carriers release more data on mobile video usage? I can only guess it is because the numbers are so small they feel that releasing them will look like their offering is a failure. But we have to start somewhere, we need data to build off of. Has anyone seen any of the major carriers release any data like this to the industry? If so, I'd love to see where you found it.

Hard Times Are Good For The Online Video Industry: Don't Give Into The Scare

No one will argue that just about every business vertical and our country are experiencing hard times. But for the online video industry, the challenging times are good for business and as a whole, good for the industry overall. To me, it looks as if too many folks are writing for headlines and want to predict doom and gloom just so they can play on emotions and do things like create lists of ways that companies in our space can "survive" the hard times. How many more posts do we have to read where someone gives advice saying things like "watch your expenses" or "renegotiate vendor contracts"? If any company in any industry does not already know to watch their expenses and isn't constantly working to renegotiate vendor contracts, in good or bad times, then they don't deserve to survive. Let them go under.

Part of the reason why we see so many of these is lists is that quite frankly, there are way too many companies that have to do with the Internet, being run by a bunch of young kids with no business experience at all. What other industries besides the Internet space do you see lists like this being made? The airline and automotive industries as a whole have been taking for years. We don't see the Airlines and those who cover the space talking about how airlines should "watch their fuel costs" or "make sure they don't have empty planes". A lot of what we are reading about in the online video space is due to the fact that many running these companies just don't have a lot of business experience. I don't fault them for that, you have to get your start somewhere, but those who have money in these companies should be overseeing them very closely all the time, not just when times are bad. And how many companies have a CEO or executive management team who might have very strategic visions or be very smart people, yet have no leadership skills or business experience. Many of the companies in the Internet space as a whole are founded by very smart technology people, not business people.

It seems that many writers want readers to give into the scare of these articles talking about how bad things are, and how much worse they are going to get, without looking at the real reason companies are having problems. Most of the companies I see laying off employees, don't have any business model to begin with. So at some point, in good economic times or bad, they are going to layoff employees anyway. That is not the case for all companies, but it is for many of them. And what about the positive impact this will have on the industry as a whole? Do we really need a hundred user generated video sites out there? Chopping many of them out of the market will help better define who the leaders are, what business models work and will assist those with real business models to grow faster and help them stand out from the sea of confusion. Many companies who have a legitimate shot at making it tell me their main marketing problem is how they make themselves stand out from all the noise that comes from having way too many companies, with no real business, in the market.

That being said, I'm not suggesting that anyone losing their job is a good thing or easy to deal with. And some cuts are coming to companies who I do think have a real business model in the future. But layoffs are a part of any business. The thing I don't like hearing is how so many executives of these companies are only just now talking about keeping an eye on costs because of the economy. Any real business person will tell you that you keep a closer eye on costs when things are good, when you tend to waste money, so that when things are bad, you are already prepared and don't have to take drastic actions. More money is wasted in good economic times with things like lavish dinners, expensive hotel rooms and company branded swag, than in times when the economy is bad.

I think it is also crucial for all facets of the online video industry to keep things in perspective and set expectations properly. For instance, at the beginning of this year it was all about how online video advertising was talking all this money from broadcast and print advertising. The death of every medium except the Internet was being predicted and as a result, people expected more than what was possible. The most aggressive prediction I saw was for online video advertising to be a billion and a half dollars in 2008. Now, at the end of this year, it looks like it will be more along the lines of $500 million. While there is nothing wrong with that number, even if it was a billion and a half dollars this year, that's less than 3% of the entire TV advertising market, that the industry is predicting such immediate death for. Lets be positive and excited about the growth we have coming, but also be realistic.

We have to keep in mind that even though this industry has been around for more than ten years now, every facet of the online video industry is still very small. The markets for online video advertising and content delivery for video are both under half a billion dollars this year. The market size for video transcoding, video publishing platforms and niche video networks are all under a few hundred million each. I think it is very easy for people in the industry to forget that while many have been working in this industry for years, our industry as a whole is still very small when compared to just about every other vertical market. We still have a lot of growth to do, a lot of innovation to bring to the market and many applications that need to be developed on top of the basic underlying technology that has been created.

Things will get worse for companies with no real business model, product offering or clear and defined message of who they are and what they offer. That's just business. But after the shakeout, our industry will still be here, business is still growing and the industry will be stronger as a result of it. We are only just getting started.

Akamai & Limelight Say Testing Methods Not Accurate In Microsoft Research Paper

Last week, I posted about a new technical research paper entitled "Measuring and Evaluating Large-Scale CDNs" that was put out by the Microsoft Research division and the Polytechnic Institute of NYU. The purpose of the study was to conduct extensive and thorough measurements to compare the network performance of Akamai and Limelight Networks.

Some noticed that I did not take any stance either way on the findings of the paper, which was mainly due to the fact that I am not a network engineer and don't pretend to know everything that is involved in properly testing a network. That being said, both Akamai and Limelight Networks responded to my requests to review the paper and provided me with their comments. Both agreed that there is a lot more to properly testing a network than just the two aspects of CDN performance the paper looked at. Limelight has posted their response to the paper on their blog and Akamai response is as follows.

Based on our internal review of the whitepaper, we believe that there are a number of stated conclusions that are incorrect. These include:

1. Akamai is less available
This conclusion is false. The researchers tested the responsiveness of a single server and group of servers independent of our mapping system - note that this is not the same as measuring the general availability of Akamai's content delivery services. Because Akamai's software algorithms will not direct traffic to unresponsive machines or locations, all their conclusion really points out is that a portion of our network is not in use at any time. (This may be due to hardware failure, network problems, or software updates.) We believe that any measurement of availability must take into account Akamai's load balancing, and that if specific IPs are being tested, then the researchers are not doing so.

2. Akamai is harder to maintain
This conclusion is also false. While Akamai has more locations, and more machines, the power of the distributed model with automatic fault detection means that Akamai does not have to keep every machine or location up and running at all times.  It is incorrect to infer from the fact that some servers are down that Akamai's maintenance costs are higher.

3. With marginal additional deployments, Limelight could approximate Akamai's performance
We believe that this conclusion is also false. In our opinion, the research team's performance testing methodology likely overstates Akamai's latency numbers. This is because any of our server deployments in smaller ISPs that do not have an open-resolver nameserver would have been missed in their discovery process. It is important to note that these are also the locations where we get closest to the end users.  If those locations were discovered by their research, we would expect the average latency numbers derived from the measurements to be lower. If they are missing some of our lowest latency deployments, then naturally the average, median, 90th and 95th percentiles will change for the better. Because these deployments are the best examples of our "deploy close to the end user" strategy, missing them affects our results more than it would Limelight's. The networks most likely missed are either smaller local ISPs in the U.S. and EU, or providers in specific countries. These are exactly the places where we'd expect Akamai to have very low latency, but Limelight to have higher latency (especially in Asia, etc.) As such, we believe that the research team's measurement method ultimately under-represents our country, "cluster", and server counts because they missed counting these more local deployments that do not have open-resolver nameservers.

4. After testing akamaiedge.net, they concluded that Akamai uses virtualization technology to provide customers with isolated environments (for dynamic content distribution)
This conclusion is false. The akamaiedge.net domain is used for Akamai's secure content delivery (SSL) service, used by WAA and DSA. While these services do accelerate dynamic content, Akamai is not using virtualization technology to provide customers with isolated environments - ultimately, the research team reached an incorrect conclusion after observing how we handle hostname to IP mapping for secure content. The measurements done also concluded that akamaiedge.net servers were in a subset of locations as compared to the larger Akamai network - this is correct, as our SSL servers are hosted
in extremely secure locations.

Furthermore, while the akamaiedge.net network is in fewer locations than the akamai.net network, it is still in more locations that Limelight's entire network. In addition, the measurements done for this network also under-counted the number of servers and locations. Finally, the whitepaper did not provide figures on CDN delay for this network, only DNS delay.

It is important to reinforce that the "per server" and "per cluster" uptime and availability measurements in the whitepaper that show Limelight as more "available" bypassed Akamai's mapping system. As such, even if our mapping system never would have sent traffic to a location, they are counting us as unavailable. 

Having a more distributed model (as Akamai does) de-emphasizes the importance of any one location, so much so that we can have entire locations down without impacting performance. Similarly, the researchers don't sufficiently consider the penalty associated with an unavailable Limelight cluster. One down location in Japan, when it is the only region in Japan, would ultimately have a much greater performance impact than having one of 20 locations in Japan become unavailable.

Additionally, it is also important to reinforce that the research performed did not measure general performance of Akamai's services (as we would do for a customer trial), but rather DNS lookup delays, and the delay to reach the server selected by Akamai's mapping system - these are only two components of a full performance measurement. By unintentionally filtering out many of the best examples of our "deploy close to end user" strategy, the research team has grossly misrepresented our availability numbers and also over-estimated our latency.

Microsoft Research Paper Measures Limelight and Akamai's Network Performance

At the end of this month, folks from the Microsoft Research team are presenting results at the Internet Measurement Conference from a recently completed CDN study with the Polytechnic Institute of NYU entitled "Measuring and Evaluating Large-Scale CDNs". While the event is not for a few weeks, the technical study is now public and available from the Microsoft Research website. Having read through it, the paper is one of the most comprehensive technical white papers I have seen on the subject in quite a few years that is available in the public domain. (UPDATED: On October 15th, I was informed by Microsoft Research that they "decided to withdraw the paper from the Internet" and as a result, I was required to remove my links in this post to the paper.)

For the study, Microsoft Research and the Polytechnic Institute of NYU conducted extensive and thorough measurements to accurately characterize the performance of Akamai and Limelight. Their measurements included charting the CDNs (locating all their content and DNS servers), assessing their server availability, and quantifying their worldwide delay performance.

The purpose of their measurements was to shed light on two radically different design philosophies for CDNs: the Akamai design, which enters deep into ISPs; and the Limelight design, which brings ISPs to home. They compared both CDNs with regards to the numbers of their content servers, their internal DNS designs, the geographic locations of their data centers, and their DNS and content server delays.

In speaking to one of the authors of the paper yesterday, he commented that their measurement techniques can be adopted by CDN customers to independently evaluate the performance of CDN vendors and can also be used by a new CDN entrant to choose an appropriate CDN design and to locate its servers. While the Microsoft Research team was originally going to study hybrid CDNs and P2P delivery, they quickly decided that comparing Akamai and Limelight different network architectures would be a great subject to tackle.

While some might be under the impression that the divisions inside Microsoft that use Akamai and Limelight for delivery commissioned the paper, this is not the case. They were certainly interested in the results, but the report was imitated solely from Microsoft Research and the Polytechnic Institute of NYU.

I will be highlighting some of the findings of the technical paper in multiple blog posts over the course of the next two weeks.

Upcoming Webinars: "Successful Live Event Streaming" and "The CDN Ecosystem"

StreamingMedia.com has two upcoming webinars I will be participating in, including answering questions from attendees during the event. The first, sponsored by Limelight Networks, is this Thursday, Sept. 18th at 2pm EDT and is entitled "Successful Live Event Streaming". You can get more details and register for the free webinar here.

And on Thursday, Oct. 2nd, Internap is sponsoring a webinar entitled "The CDN Ecosystem: Going Beyond Content Delivery". You can get more details and register for the free webinar here.

If you have any questions on either of these topics, you can e-mail them to me in advance or put them in the comments section below.

My Frost & Sullivan Webinar On The CDN Market Is Now Archived

My Frost & Sullivan webinar from yesterday entitled "Content Delivery Networks: Market Drivers & Challenges for Delivering Video" is now archived and available for viewing. You can also download the slides directly from the presentation.

We had nearly 50 questions presented during the Q&A portion of the event and over the next few days, I will be compiling all of the questions and providing written answers to them on my blog. Additional questions are welcomed and can be sent in via the feedback form on this post.

Worldwide Video CDN Revenue $400 Million In 08, Grow To Over $1.4 Billion By 2012

Yesterday, on my Frost & Sullivan webinar (stream archives here) (download audio here) about the video CDN market, we released preliminary data from the upcoming Frost & Sullivan report entitled "World Content Delivery Networks Market". Due out next month, this report will break out the worldwide CDN revenue, specific to video delivery in the North America, Europe and Asia Pacific regions.

The preliminary data shows that the worldwide video CDN revenue will be a little more than $400 million in 2008, increasing at a Compound Annual Growth Rate (CAGR) of more than 30%. As the slide below shows, we expect the worldwide video CDN revenue to grow to more than $1.4 billion by 2012.

These numbers are very specific to revenue obtained for video delivery services by CDNs and does not include revenue from P2P based networks or any type of content outside of video. While the report, when released, will also break out P2P based revenue and include additional types of content like gaming, these numbers are for video delivery only. To obtain these numbers, we spoke to every major CDN provider in North America, Europe and Asia and obtained revenue numbers or guidance, from nearly every one, on what percentage of their revenue came from just video and from what region.

While there have been a lot of reports put out lately on the CDN market, I had yet to see one that breaks out revenue for just video delivery, which as everyone knows, is one of the fastest growing segments of the overall CDN industry. Delivering video is a completely different animal than delivering other types of content and we think it is important to treat it as such and provide data specific to that market. When released, the report will also detail the market drivers, restraints, market share, competitive analysis, and industry challenges specific to the video delivery industry.

Eight months ago, I wrote a post on my blog that gave out numbers on the size of the video CDN market. These Frost & Sullivan numbers are more accurate and more specific since we spent a lot of time interviewing every CDN, including those outside the U.S. Also, my previous numbers from last year contained revenue from some P2P based services and other content such as gaming, which is not really classified as video and should be put in the application category. These numbers also contain more realistic growth projections based on having spent weeks speaking to every major CDN.

That being said, what factors going forward have the ability to affect and alter these numbers? Clearly, many forces are at play in the market and faster adoption of HD content, mobile video and other consumer facing content services have the ability to grow the market faster. While some may assume that the market will grow larger by the entrance of new CDN players, like carriers or telcos, that won't change the market size, only the market share.

Putting exact numbers to any industry, let alone a specific segment of the industry like outsourced video delivery, takes collecting a lot of data and speaking with every vendor in the market on a regular basis as well as speaking to hundreds of customers. Once the report is finalized and ready for release, it will provide a lot more granular details on the data and will talk about market factors that could change the market sizing either way. Frost & Sullivan will be tracking the CDN market very closely over the next 12 months and we'll update these numbers based on new data we collect. I will also be doing additional webinars on the CDN market so I can answer as many questions as possible about the market and the industry's growth. You can always find the latest data we have on the size of the video CDN market at www.cdnmarket.com

Market sizing data from this post can be used by anyone as long as you credit Frost & Sullivan.

Join Me For A Free Frost & Sullivan Webinar On The CDN Market

On Wednesday August 20th, I will be hosting my first Frost & Sullivan Analyst Briefing on the CDN market. Each month, Frost & Sullivan analysts provide free briefings on a variety of topics in the Information & Communication Technologies (ICT) industry and this month I will be covering the latest trends and data from the CDN market.

This webinar will also highlight data from our new report we will be releasing next month entitled "World Content Delivery Networks Market". The report will provide revenue and demand forecasts for CDN solution providers and peer-to-peer based solutions broken out geographically in different regional markets: Americas, EMEA, and Asia Pacific.

Along with audience Q&A, these points will also be discussed:

• New CDN players in the market
• Recent acquisitions and VC funding
• Size of the market opportunity
• Impact telcos may have in the industry
• The role P2P and hybrid networks may play
• Growth drivers and barriers in the market

You can register for this free webinar on the Frost & Sullivan website and can submit questions to me via e-mail in advance. If there is a topic you want to see me cover, let me know. The webinar starts at 11am EDT and will last about an hour, or as long as you have questions.

I am going to do as many of these free webinars as possible on various topics surrounding the online video space, not just CDN. At Frost & Sullivan, we have many reports coming up on the online video industry including: World Video Server Market, World Video Encoding Market, World Streaming Platforms Market, World Enterprise Content Management Market, World Digital Rights Management Market, World Digital Media Storage Market and World IPTV Server Market amongst others. If you'd like a complete list of all future reports, send me an e-mail.