• 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.

• 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.

• Limelight reports third quarter 2009 results. Wednesday Limelight Networks reported financial results for the third quarter of 2009.  Revenue for the quarter was reported at $32.5 million, up 1% from the second quarter of 2009.  Capital investments were $10.6 million and the company ended the quarter with approximately $153 million in cash and short-term marketable securities. ”With our recently announced XD Platform and the mobility and monetization solutions we released during the quarter,” said Limelight CEO Jeff Lunsford, “we are positioning Limelight Networks to be a core provider of cloud-based services within this transformed world, helping forward-thinking media, entertainment, enterprise and government organizations leverage the next-generation Internet’s capabilities to differentiate from their competitors and better serve their constituents.”
• Internap reports third quarter 2009 results. Internap reported revenue of $64.4 million Thursday, a decrease of 1.5% compared with the third quarter of 2009. Internap CEO Eric Cooney noted early signs of progress with $7.6 million in adjusted EBITDA and several important milestones in the turnaround of Internap’s business. Cooney also noted several steps being taken to stabalize a fourth consecutive quarter of declining revenue for Internap’s IP Services. The next generation content delivery network platform Internap promised in previous earnings calls will be released at the November 17th Streaming Media Web trade show. CFO George Kilguss noted that CapEx should increase in 2010 as Internap plans a new round of colocation expansions.

• 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

• 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.

• LimeLight CDN used to roll out Brightcove Adobe Flash Media server. Online video platform provider Brightcove announced Monday that it has rolled out broad support for Adobe Flash Media Server 3.5 through the Limelight Networks content delivery network.  Brightcove has also introduced on-demand access to advanced security options for video stream encryption to the company’s global customer base.  The BusinessofVideo.com blog points out that Limelight and Brightcove have been working together to sell to Akamai accounts as a team.  It was rumored last week that Google was weighing the acquisition of Britcove for between $500 and $700 million.
• Akamai managed delivery of virtualized desktops. Akamai announced Monday a managed Internet service for optimizing delivery of virtualized applications and desktops.  The offering is targeted at companies wanting to deliver applications over virtual desktop infrastructure products offered by companies such as Citrix, Microsoft and VMWare.  VMWare’s Scott Davis outlines the Desktop Vision in a Monday blog post.   Desktop virtualization is a hot topic, and is set to take off in 2010.

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.”

Akamai (AKAM) said it plans to appeal the juge’s ruling. In the meantime, Limelight said the ruling would allow it to free up $66 million it has reserved to pay potential damages, legal fees and other expenses associated with the case.

At the time of the Februart 2008 jury verdict, Limelight stated that “an unfavorable outcome could seriously impact the Company’s ability to conduct business” and that “a permanent injunction could prevent us from operating our CDN altogether.” In October Limelight said it had rewritten the content delivery network software it licensed to Microsoft Corp. If the revised software can support Limelight’s own network, it could reduce the impact of the Akamai patent ruling on Limelight’s ongoing operations.

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 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.

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.

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.  

Here’s a question: Why doesn’t Akamai have its own blog with an RSS feed? Akamai publishes tons of cool content on its site, including videos, podcasts, white papers and even data visualizations. The company could instantly increase its visibility with a RSS-enabled blog that provides a central feed to publicize this content. This now concludes my advice from 2006.

UPDATE: Lydia Leong at Gartner has a series of posts critiquing the Microsoft/NYU research at her CloudPundit blog. Lydia’s take: “The bottom line: The Microsoft study is very interesting reading, but it doesn’t provide any useful information about CDN performance in the real world.”

Microsoft is building its own content delivery network (CDN), with Limelight providing software and engineering support. The August 2007 agreement between the companies was updated on Oct. 1 to address the Akamai ruling. Here’s an excerpt from the SEC filing: 

Under the Agreement, (Limelight) agreed to license certain software to Microsoft. The Company has been involved in litigation in which a jury verdict has been rendered stating that the Company’s provision of content delivery network services to its customers infringes certain patent claims of Akamai Technologies, Inc. The Company has created or is creating a new version of its software, which the Company believes is or will be non-infringing. The Amendment provides for the implementation of a new version of the Company’s software within Microsoft’s infrastructure.

The brief filing does not indicate whether Limelight has completed the workaround. But it suggests that Microsoft is now satisfied that the software Limelight is providing will no longer infringe Akamai’s patents. If the revised software can support Limelight’s own network - which is not explicitly addressed in the filing - it could reduce the impact of the Akamai patent ruling on Limelight’s ongoing operations.

The Microsoft CDN , which it calls an Edge Content Network (ECN), is designed to beef up the company’s infrastructure to handle “Internet audiences and content offerings that are orders of magnitude larger than today,” according Debra Chrapaty, Corporate Vice President of Global Foundation Services for Microsoft. Chrapaty has said that the ECN will include at least 99 nodes around the world. 

The agreement between Microsoft and Limelight was included in an SEC filing. It calls for the ECN to be housed in Microsoft data centers, along with some facilities operated by Limelight and some third-party colocation centers. Under terms of the agreement, Microsoft will specify the location of nodes and supply the hardware, and Limelight will install the software and manage the node during a transition period before handing off to Microsoft.