Roundup: Limelight, Emerson, Neptuny

Here’s a roundup of some of some of this week’s headlines from the data center and hosting industry:

• Limelight Acquires EyeWonder Inc. Limelight Networks (LLNW) announced an agreement to acquire Eyewonder, a privately-held Atlanta company offering interactive digital advertising products and services. “Today, two best-in-class companies are combining to capitalize on the clear opportunity created by a macro shift of content consumption and advertising spend away from legacy channels and towards the growing world of Internet-connected devices,” said Jeff Lunsford, chairman and CEO of Limelight.  Eyewonder’s ad serving platform is projected to service over $500 million in media spend globally in 2009.  Limelight and Eyewonder have been partners for years and the combined company will have over 900 last-mile access networks, relationships with over 2,500 online businesses, and have over 20 ecosystem partners. EyeWonder shareholders will be paid approximately $110 million and key employees will also enter into employment arrangements  with Limelight that will involve additional equity compensation.
• Emerson Announces Liebert Data Center Audit. Emerson Network Power (EMR) announced availability of the Liebert data center audit, an affordable on-site IT infrastructure assessment designed to help small and medium-sized companies identify, evaluate and resolve cooling and power vulnerabilities.  Aimed at companies doing strategic projects such as virtualization, consolidations and capacity upgrades, Emerson hopes the audit will protect against unplanned downtime or IT equipment experiencing degradation due to excessive heat. “The on-site Liebert Data Center audit integrates a methodical evaluation of infrastructure technologies and practices with the expertise of Emerson Network Power’s power and cooling specialists,” said Mark Melvin, chief technology officer at ePlus, a Liebert partner.
• Energ-IT Study Detailed by Neptuny. Italy-based Neptuny, discussed initial findings of the Energ-IT project that focused on Green IT.  Several companies collaborated on the Energ-IT project to build a test data centre comparing traditional IT infrastructure to virtualized  in order to determine benchmarks on green savings and action items that can be applied to the data center.  Initial findings of the project were discussed at a workshop last week, but overall goals are to identify a set of green re-engineering actions to be applied to legacy systems, empirically assess related energy savings and compare savings with top market solutions by means of a test data center.

Earnings: Cisco, SGI, Limelight, Internap

Here’s a roundup of quarterly financial results announcements this week:

• Cisco reports first quarter 2010 Earnings.  Cisco reported first quarter results Wednesday for the period ended October 24, 2009.  Net Sales were $9 billion in the first quarter, a decrease of 13% year over year.  CEO John Chambers noted that the fourth quarter of 2009 was a clear tipping point and first quarter 2010 results continued to reflect strong sequential growth trends. Chambers also said “a new model of productivity based on collaboration is clearly emerging and we believe this may be the most profound opportunity for businesses in our 25 years as a company.” Sitting on total cash of $35.4 billion, the Cisco build – buy – or partner innovation engine is ready gain momentum in 2010.  Cisco also announced that up to $10 billion in additional repurchases of its common stock was authorized by its board of directors.
• SGI reports first quarter 2010 results. SGI reported first quarter 2010 results Wednesday for the period ending September 25, 2009.  Revenue increased by 103% from the prior quarter and 88% from the comparable year ago quarter on a non-GAAP basis. “Operationally, our integration is ahead of schedule in most key areas,” said SGI CEO Mark J. Barrenechea. “We also introduced new products that could expand our addressable market by over $1.7 billion while investing for long-term growth.” Cash, cash equivalents, investments, and restricted cash for the end of Q1 was $123.5 million, compared to $139.5 million at the end of the prior quarter.

Roundup: VMware, Equinix, Limelight

Here’s a roundup of more news announcements from the data center and hosting industry:

• VMware Opens Washington Data Center.  Virtualization giant VMware announced Tuesday the opening of a new green IT data center in East Wenatchee, Washington.  VMware expects to save $5 million per year due to $4 million in energy savings and $1 million in location consolidation costs.  A LEED platinum certification from the Green Building Council is pending.  Green technologies employed at the Washington data center include Hydroelectric power, an economizer strategy to take advantage of free air cooling, containment methodology and virtualization technology (of course).  VMware is targeting a PUE of between 1.2 and 1.5. “By utilizing a non-proprietary datacenter design, the facility is one that virtually any enterprise or government agency can build,” said CIO Mark Egan. “And we are committed to using the lessons learned in the design and development of our datacenter to help our customers achieve similar benefits.”  Last May VMware bought a 5% stake in Terremark, who was featured in the keynote by VMware CEO Paul Maritz at VMWorld 2009.
• Equinix Develops Carrier-Neutral Ethernet Exchange.  At the ITU Telecom World 2009 conference in Geneva Equinix announced a global carrier-neutral Ethernet services platform, aimed at creating new and expanded Ethernet serivce opportunities for carriers.  Equinix has partnered with Alcatel-Lucent in this venture.  “Equinix’s new carrier neutral Ethernet exchange program is a natural extension of its existing IP interconnect offerings and gives a competitive edge to customers already interconnecting in Equinix POPs/carrier hotel locations,” said Alcatel-Lucent President Basil Alwan. The Equinix solution is designed to automate the process of interconnection agreements between carriers and enable them to seamlessly interconnect with multiple Ethernet carriers that have complimentary footprints through a centralized switching fabric.  Alcatel-Lucent recently had their next generation optical transport solution deployed by First Communicaitons, an integrated telecommunications carrier based in the Midwest.  The solution was a part of a DWDM high capacity, low latency network from Chicago to New Jersey.
• Limelight introduces next-generation global network. On Monday Limelight Networks introduced XD, the next generation of the company’s global network Platform.  Along with XD,  Limelight (LLNW) announced three new services that take advantage of Adaptive Intelligence to provide advanced levels of control, performance and insight into real-time delivery conditions. ”With XD, we are combining network innovations and advanced software to actively manage each object delivery in real-time on a per-connection basis, ensuring a brilliant user experience across a wide variety of devices, even under extreme and changing network conditions,” said Limelight co-founder and CTO Nathan Raciborski said

Roundup: NASA, PG&E, Limelight, Akamai

Here’s a roundup of some of some of this week’s headlines from the data center and hosting industry:

• NASA to spend over $4 Billion on IT Services. Federal Computer Week reports that NASA is planning on opening for competition a series of IT services contracts worth an estimated $4.28 billion.  Some Request For Proposals (RFPs) could be out as soon as September 22 for the agency-wide Information Technology Infrastructure Integration Program at NASA.     Included in the consolidation project is a contract for data center operations, facility management and hosting services for NASA’s Enterprise Data Center (NEDC).  This contract could be worth $1.5 billion over five years and is due to be awarded in May 2010.
• PG&E starts rebates for data storage. Pacific Gas & Electric has added thin provisioning and MAID data storage systems to the data center technologies it will pay people to install. According to the GreenTech Media article data centers in northern California use up about 2.5% of the power, compared to about 1.5% nationwide. Beyond looking at other storage technologies for possible rebates, PG&E is looking at developing incentives for thermal energy storage.

Judge: Limelight Didn’t Infringe Akamai Patents

A federal judge has overturned last year’s jury verdict that Limelight Networks infringed on patents owned by Akamai Technologies, marking a major reversal in the patent battle between the two leading content delivery networks. Last February a jury ordered Limelight to pay Akamai $45 million for infringing upon a patent (U.S. Patent No. 6,108,703 ) by Akamai founders Tom Leighton and Daniel Lewin.

On Friday afternoon a judge from the U.S. District Court of Massachusetts granted a motion from Limelight seeking top overturn the verdict.

“We are pleased the Court granted our motion for reconsideration in this matter and ruled in our favor,” said Jeff Lunsford, chairman and chief executive officer of Limelight Networks (LLNW). “We have long maintained that we do not infringe the ‘703 patent. This ruling affirms that Limelight Networks respects the intellectual property of others, and that our growth and success have been achieved through our own innovation, hard work, and customer-focused operations.”

Jury: Limelight Didn’t Infringe Level 3 Patents

A jury ruled Friday that content delivery network Limelight Networks (LLNW) has not infringed on patents owned by Level 3 Communications (LVLT). The ruling helped shares of Limelight gain 27 percent in Friday’s trading session.

Level 3 filed suit against Limelight in late 2007, asserting that Limelight was infringing on patents Level 3 acquired earlier that year with its purchase of the CDN assets of Savvis Communications (SVVS). Here are the press releases and blog coverage:

• Limelight’s statement
• Level 3’s press statement
• Contentinople
• Business of Video

Limelight’s CDN Pricing Gets Disruptive

Dan Rayburn at the Business of Online Video tracks pricing for content delivery services as closely as anyone. When analysts predict CDN pricing wars, Dan is usually the voice of caution, adding balance and context to the conversation. So his post this morning about the recent price cuts by Limelight Networks (LLNW) got my attention.

Limelight has been “getting a lot more aggressive” on pricing for video delivery, and telling customers that the new pricing is driven by recent infrastructure improvements that have lowered Limelight’s delivery costs. Dan had anticipated this would happen eventually, but wasn’t expecting to see it until the second quarter of 2009. He writes:

If they can cut their own costs, pass that savings onto customers in the form of lower pricing and increase their margins all at the same time, we are going to see another huge shift in pricing in this quarter. Not to mention, Limelight is going to continue to grab a lot of the new business in the market and continue their momentum. I am already starting to see some big changes in pricing this month as compared to last quarter and if Limelight continues to put pressure on some of the other providers, we’re going to see CDN pricing for video slashed over the remaining two months of the year.

Limelight’s recent momentum would have seemed unlikely back in February, when the company lost its patent infringement lawsuit with rival Akamai (AKAM). At the time, analysts questioned the company’s ability to continue operating and predicted a sale to a competitor or telco.

The Rackspace-Limelight CDN Deal

Almost lost in the hubbub around Rackspace’s acquisitionsof Jungledisk and Slicehost last week was an expanded partnership between Rackspace and Limelight Networks (LLNW). Lydia Leong has some details at CloudPundit:

Under the new partnership, customers of Rackspace’s Cloud Files (formerly CloudFS) service — essentially, a competitor to Amazon S3 — will be able to choose to publish and deliver their files via Limelight’s CDN. Essentially, this will place Rackspace/Limelight in direct competition with Amazon’s forthcoming S3 CDN.

Amazon said in September that it would launch a content delivery network that will deliver files stored on Amazon’s S3 storage service.

Akamai, Limelight Both Object to CDN Study

Rival content delivery networks Akamai Technologies and Limelight Networks finally agree on something: they both take issue with the methods used by researchers from Microsoft and NYU in a study on CDN performance published last week. The study found small performance differences between the two CDN providers in North America, but a “big gap in performance” in Europe and Asia, where Akamai has more data centers than Limelight. It also suggested Limelight might be able to equal Akamai’s performance with as few as five additional data center locations.

Both Limelight and Akamai say the researchers were measuring entirely the wrong thing, and Akamai says most of its conclusions are false. Akamai’s full response is posted at Dan Rayburn’s blog, while Limelight has posted its analysis on its company blog, In The Limelight.