Dan Rayburn at the Business of Video says CDNetworks' deal for Panther Express is not going to be the start of a consolidation trend in the content delivery, as suggested by some analysts (and DCK as well).
"The problem with thinking that major consolidation will take place is that the vast majority of CDNs don't own any real technology, don't have applications, have no patents, no intellectual property, have a small number of customers and very little revenue," Rayburn writes. "Lets say that you are a telco that wants to enter the CDN market. What do you get by acquiring a current CDN that has very little in the way of technology or revenue?"
New content delivery companies raised more than $325 million from investors in 2007 and the first half of 2008. If Dan's correct that these new companies have little revenue and are unlikely to be acquired, the content delivery sector may turn out to be the graveyard for a lot of venture funding. Clearly, trying to grab market share from Akamai (AKAM) and Limelight Networks (LLNW) has proven much more difficult than these companies envisioned.