A Cisco CDN?

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Cisco Systems clearly sees Internet video and large-file transfers as key drivers for the future of its business. So it’s not a surprising to hear reports that Cisco is leasing space in data centers for a content delivery network (CDN). Dan Rayburn┬ásays he has heard from two colocation providers that Cisco has recently acquired space for a future CDN offering for third parties.

Since Cisco (CSCO) is sitting on about $30 billion in cash, Dan asks the obvious question: “If Cisco is in fact building their own CDN, you have to wonder why they don’t acquire one of the major CDN players already in the market,” he writes. “Cisco has the cash and has not been shy lately in saying that they want to do more acquisitions in the market. While Akamai may be too expensive for them, companies like Limelight and EdgeCast could be taken out of the market for what would be pocket change to Cisco.”

As an example,┬áthe market capitalization of Limelight Networks (LLNW) is currently about $295 million. Limelight has a strong video delivery business, and Microsoft as a customer. Whether it builds or buys, Cisco’s interest in content delivery is one more storyline that will keep the CDN sector interesting in months and years to come.

About the Author

Rich Miller is the founder and editor at large of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.

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3 Comments

  1. Henry

    Cisco's CDN solutions are crap and expensive. So they don't sell well. So from their point of view it would be logical to re-shift their focus and build their own CDN based on their own technologies. But that means they will compete with their own customers and that is the beginning of the end. Buying Limelight also is not a serious option. They lose millions per month and there is not even a limelight on their horizon...

  2. Chris

    Or they could sell routers to Limelight and not burn their bridges.