Report: SAVVIS Shopping Its CDN Network
October 23rd, 2006 By: Rich Miller
There’s been a lot of speculation about deals for content distribution networks (CDNs) in recent months with the growth of bandwidth-intensive applications like audio, video and software as a service (SaaS) apps. Om Malik from GigaOm reports on some specific market chatter: that SAVVIS Communications may sell its CDN business, which started life as Digital Island and was subsequently owned by Exodus and Cable & Wireless. An excerpt:
There have been a few bids from interested parties, though nothing has been finalized, and the deal might not go through. The bids for the 91-person business that encompasses about sixty clusters in 29 countries are said to be over $100 million.
Possible buyers? Om suggests CDN powerhouse Akamai might even be interested as a way to buy some market share and reduce the field of CDN competitors.
Andy Schroepfer from Tier1 Research has predicted some deals in this sector, saying large Internet companies will eventually find it easier to buy an existing CDN than build out their own distribution network for video, audio and Web 2.0 apps.
There also seems to be speculation in the air that Google might be interested in a deal for Limelight Networks. This is probably tied to Google’s purchse of YouTube, which was one of Limelight’s marquee customers. Take that with a major grain of salt, as market rumors seem to have Google making a run at lots of companies – even Level 3.