Subscribe to our Data Center Newsletter or get a daily summary by e-mail.

AT&T Preps CDN Offering

AT&T has confirmed that it is entering the content delivery market in a bigger way, ending months of speculation about its plans. Here's an excerpt from Dan Rayburn at the Business of Online Video:

Since December, AT&T has been busy working on the build out and expects to spend between $70-$80 million on infrastructure this year. By the end of 2008, AT&T is aiming to have 400Gbps of capacity online, for all their content delivery services, which would increase their capacity by 4x what they have now. When completed, their content delivery services will be delivered from 32 nodes in 7 countries and they will be Adobe Flash Certified by year's end and will be supporting live and on-demand delivery for all the major formats.

AT&T has been expanding its data center network and now has 28 worldwide - 14 within the U.S. and 14 overseas.

Posted by Rich Miller May 13, 2008 | Permalink | Newsletter

May 12, 2008

SoftLayer Launches CDNLayer Delivery Network

SoftLayer has launched its own content delivery network (CDN), joining a handful of hosting companies that have used multiple data centers to build a CDN platform. The new CDNLayer service will deliver video and rich media files for a flat fee of $20 a month for the first 200 gigabits of data transfer, with a fee of 20 cents per GB beyond that.

"CDNLayer is one more way we provide enterprise-class services to customers of any size," said Nathan Day, Chief Technology Officer at SoftLayer. "Consumer demand for online video and media-rich websites is exploding. Companies and individuals in every industry, from entertainment and gaming to social networking and e-commerce, will benefit from using CDNLayer to optimize their content management and delivery."

SoftLayer joins Hostway and Voxel.net as hosting providers who have created their own content delivery services, offering even more options in a rapidly-growing CDN market that now includes at least 31 other providers.

Posted by Rich Miller May 12, 2008 | Permalink | Newsletter

May 07, 2008

It's Official: Kontiki Spun Off to MK Capital

VeriSign confirmed today that its Kontiki peer-to-peer content delivery unit has been spun off to MK Capital, with VeriSign receiving $1 million in cash and 3,980,000 shares of the Purchaser's Series A Preferred Stock. There's no valuation available for MK preferred shares, but Dan Rayburn says the deal price had been rumored at $40 million. Reports of the deal first emerged last week.

Kontiki, which was founded in 2000 and acquired by VeriSign in 2006, keeps all its customers (including the BBC) and several members of the original Kontiki management team, including President Eric Armstrong and Todd Johnson, who was CEO of Kontiki and is now Chairman of the Board.

"We are very excited to be financing the expansion of Kontiki," said Mark Koulogeorge, principal, MK Capital. "The company has a unique and tested peer-to-peer (P2P) technology that addresses the need to efficiently distribute video over the Internet and private networks. The new generation of Internet users will demand video content in order to be engaged. As the use of video as a communication tool continues to expand, Kontiki's technology will be increasingly strategic to corporations worldwide."

Posted by Rich Miller May 07, 2008 | Permalink | Newsletter

May 01, 2008

Report: Kontiki CDN Sold to MK Capital

VeriSign (VRSN) will sell its Kontiki content delivery network to MK Capital, according to Ryan Lawler at Contentinople, who said VeriSign is selling for less than the $62 million it spent to acquire Kontiki two years ago. MK Capital is one of the venture capital companies that provided initial funding to Kontiki before it was acquired, and was also a backer of Bladelogic, which was recently acquired by BMC.

VeriSign began seeking a buyer for Kontiki in December as part of a broader corporate restructuring. The changes at VeriSign began last May, when long-time CEO Stratton Sclavos resigned and was replaced by board member William Roper, who commenced a broad review of the company's operations. Kontiki is a peer-to-peer CDN that was purchased by VeriSign in 2006 and was a key part of VeriSign's Intelligent CDN, a hybrid content delivery service combining traditional edge-based caching with P2P capabilities.

Posted by Rich Miller May 01, 2008 | Permalink | Newsletter

April 29, 2008

Velocix Accelerator Offers Free CDN Service

Velocix today announced that it will provide free content delivery network services as part of a new offering called Velocix Accelerator.

The free CDN service includes a 500GB per month delivery allowance for global file download, video progressive streaming and website acceleration services. Companies requiring more than 500 GB per month or Flash Streaming or Hybrid-P2P download can opt for Velocix Accelerator Pro for $1,000 a month. Both Velocix Accelerator and Velocix Accelerator Pro are currently in closed Beta.

The free CDN service is designed to attract cost-conscious start-ups, who would then be candidates for the paid Accelerator Pro service as they grow or move into Flash delivery. But the launch of a free CDN - even as a funnel for paid services - will likely prompt fresh concern about pricing wars and profit margins in the increasingly crowded CDN market. The Velocix Accelerator launch follows the news that Voxel is offering an "ultra low cost" CDN service leveraging Amazon's utility computing platformS3, which is increasingly being used by video providers as a makeshift CDN.

"As visitor numbers expand and our Velocix Accelerator customers see an increasing demand for their on-line digital services, Velocix Accelerator Pro provides them with a simple upgrade that includes more advanced delivery services for their growing and more sophisticated digital asset delivery requirements," said John Dillon, Chief Marketing Officer of Velocix.

Posted by Rich Miller April 29, 2008 | Permalink | Newsletter

April 14, 2008

CDNs: Move, CDNetworks, BitGravity, Limelight

There's tons of news today from the content distribution networks (CDNs). Here's a roundup and some links:

Move Networks has raised $46 million in a Series C round of funding, with investors including Benchmark Capital, Cisco, Comcast Interactive Media, Televisa and previous investors Steamboat Ventures and Hummer Winblad Venture Partners. Move has now raised $67.9 million, according to Dan Rayburn, who says a figure of $91 million cited by TechCrunch.
CDNetworks announced that its Advanced Data Center solutions will now be available in the US and Europe as well as the Asia, its original market focus. CDNetworks ADS provides a suite of services ranging from data center space to a fully-outsourced managed data center. "CDNetworks has eight years of experience in providing Advanced Data Center solutions in Asia and has leveraged this know-how to provide a full range of solutions in the US and Europe," said Simon Lee, CEO of CDNetworks US. "We add to the benefits we provide as a CDN with in-region infrastructure, including local service and support, without the high cost of deploying private data centers." The company has U.S. nodes in New York, Chicago, Atlanta, Dallas, San Jose and Seattle.

Posted by Rich Miller April 14, 2008 | Permalink | Newsletter

March 27, 2008

Comcast, BitTorrent Declare A Truce

Comcast Corporation and BitTorrent, Inc. say they have resolved their differences, and will work together to make Comcast a testbed for P2P-sensitive approaches to network management, with BitTorrent focusing on optimizing its software while Comcast fine tunes its network. The two companies are promising to expand the dialogue to include other ISPs and peer-to-peer services, and publish the results of their efforts.

"Rather than slow traffic by certain types of applications — such as file-sharing software or companies like BitTorrent — Comcast will slow traffic for those users who consume the most bandwidth," Comcast Chief Technology Officer Tony Werner told TorrentFreak.

Comcast called the new approach "more appropriate for today's emerging Internet trends. We have been discussing this migration and its effects with leaders in the Internet community for the last several months, and we will refine, adjust, and publish the technique based upon feedback and initial trial results." Comcast is upgrading its network to DOCSIS 3.0, which can help speed cable modem infrastructure and has been deployed in some international markets.

Posted by Rich Miller March 27, 2008 | Permalink | Newsletter

March 26, 2008

Stealthy CDNs Clearleap, Cotendo Get Funding

Several stealth-mode startups in the content delivery business have received funding, continuing the surge of venture capital investment in CDNs.

Atlanta-based video startup Clearleap has closed a $9 million first round of venture capital funding led by Trinity Ventures and Noro-Moseley Partners. "Financial backing from industry leaders like this will help us more quickly deliver the next generation television experience," said Braxton Jarratt, co-founder and CEO of Clearleap. Trinity hailed Clearleaf's "pioneering approach to video delivery," but there were no aditional details. But Jarratt told Light Reading that the company is "not recreating the CDN wheel" - suggesting something in the CDN-ish realm.

Venture Beat reports that Israeli startup Cotendo has received funding from Sequoia Capital, which says that Cotendo "develops a unique Content Delivery Network (CDN) platform, with better performance and low operational costs." Om Malik reports that co-founders of the company are Ronni Zehavi and David Drai, who both worked for anti-spam and security software company, Commtouch Software

We'll have to wait to learn more. But the content delivery market, which already has more than 30 competitors, will soon be even more crowded. And with all this talk of "unique" and pioneering" technology and low operating costs, I'll bet that we'll see more CDNs integrating P2P technology like Velocix, which this morning announced a streaming P2P hybrid CDN offering for live events.

Posted by Rich Miller March 26, 2008 | Permalink | Newsletter

Velocix Launches Live Streaming P2P CDN

Content delivery provider Velocix today announced a hybrid streaming service combining traditional caching with peer-to-peer (P2P) delivery for live events. The hybrid-P2P offering is part of a family of new Live Video Streaming solutions from Velocix (previously known as CacheLogic).

Velocix, which is based in Cambridge, England, specializes in delivering large digital media files such as video, software and games. The company says the hybrid-P2P approach offers better scalability than traditional CDNs, as well as "compelling delivery costs and economics."

Live events such as sporting events and music concerts present significant online delivery challenges. Unlike on-demand services, where requests for pre-recorded materials are spread over time, live services feature concentrated demand from a potentially huge audience for the duration of the event.

As a result, broadcasters of live events are often forced to compromise quality or limit audience sizes, according to Velocix CEO Phill Robinson, who said his company's hybrid-P2P "fundamentally disrupts the performance and economics of live streaming on the Internet."

"What we see is that when you get a very large audience, you need P2P assistance," Robinson said. "The potential with a hybrid P2P approach is that you have almost limitless scalability."

Posted by Rich Miller March 26, 2008 | Permalink | Newsletter

March 19, 2008

BBC May Build Its Own CDN to Support iPlayer

The BBC may build its own content delivery network (CDN) to lessen the bandwidth impact of its iPlayer service on UK Internet service providers, according to The Register. The iPlayer, a Flash app which delivers full-length streaming video of BBC programs, has resulted in a huge increase in streaming bandwidth for British ISPs since its introduction in December. Early reports found that costs for streaming video had tripled at one provider, raising concerns that the iPlayer's popularity would break the business models of ISPs. There are also a growing number of reports of end users exceeding their bandwidth caps and incurring fees for surplus bandwidth.

After initially insisting the iPlayer was having a negligible impact on UK Internet infrastructure, the BBC now says it is exploring whether to build its own CDN network. "Content delivery networks are one of many solutions we're considering to give consumers a better experience," the BBC's Anthony Rose told The Reg. ""The closer you can get the content to the edge of the network the better for everyone." The BBC is reportedly considering working with Velocix (formerly CacheLogic), which uses a hybrid CDN approach integrating peer-to-peer (P2P) technology.

Posted by Rich Miller March 19, 2008 | Permalink | Newsletter

March 14, 2008

Verizon Testing P4P for Peer to Peer Delivery

Verizon (VZ) has been test-driving peer-to-peer file transfer using the new P4P protocol, which is being jointly developed by a group that includes P2P services BitTorrent and LimeWire, content delivery specialists Pando Networks and Verisign/Kontiki, telcos Verizon and AT&T, and network gear vendor Cisco Systems.

Ars Technica reports that the tests by Verizon and Pando show the new protocol "provides a significant boost in download performance while simultaneously reducing network congestion." An excerpt from the story:

The implication is quite clear: network operators can more effectively cut costs by enabling better P2P rather than trying to impede it. The question that remains is whether this solution will be extended to all P2P traffic, or just services favored by ISPs and Big Content. Verizon condemns illegal filesharing and says that the new protocol is intended for adoption by legal commercial services, but also reiterates that—unlike AT&T—the company has no intention of policing its own network. Regardless of the implications for piracy, Verizon believes that P4P is an important step towards solving the problems that peer-based file transfer technologies pose to network management.

Discussion of Internet capacity is in the news again after a front-page story yesterday in the New York Times. For more information on P4P, see the Distributed Computing Industry Association (DCIA) web site and the group's mission statement (PDF) for P4P. There's also a good summary from Wired of P4P.

Posted by Rich Miller March 14, 2008 | Permalink | Newsletter

March 11, 2008

Highwinds Raises $55 Million for CDN Offering

Investment continues to pour into the content delivery network (CDN) business. Today Highwinds announced that it has raised $55 million in equity financing from General Catalyst Partners and Alta Communications. The funding will be used to invest in the infrastructure build-out of Highwinds’ RollingThunder content delivery network. Highwinds also rolled out a partnership with Digital Rapids Corporation and Knack Networks to create advanced IPTV solutions for professional media companies.

The funding could have benefits for Highwinds' data center providers. Highwinds has leased space in data centers in 16 cities to power RollingThunder, with U.S. locations including Ashburn, Va., Atlanta, Chicago, Los Angeles, New York and Phoenix, and European sites in Amsterdam, Frankfurt, London and Paris. That data center map closely tracks the network of Equinix (EQIX), which is listed as one of Highwinds' technology partners. Highwinds has also leased colocation space in Global Crossing facilities in Atlanta (56 Marietta Street) and Phoenix.

Posted by Rich Miller March 11, 2008 | Permalink | Newsletter

March 06, 2008

CDN Links: Limelight, Navisite, BitGravity,

It's been a busy week for news about content delivery network (CDN) sector. Here's a roundup of the coverage.

The CEO of Limelight Networks (LLNW) says it's business as usual in the wake of last week's court decision that Limelight infringes a patent from Akamai (AKAM). CEO Jeff Lunsford said Limelight has "plans in place for all those scenarios." See Silicon Alley Insider for the full story.

Will Level 3 (LVLT) use Akamai's court win as an opportunity to make a play for Limelight? Dan Rayburn recently outlined some reasons why such a deal might happen.

Navisite (NAVI) says it has reduced its focus on the content delivery market. The company discussed its progress in its recent earnings call with analysts. "We found that (CDNs) are very tough to scale," said Navisite CEO Arthur Becker. "We've tried for some time, and still do a small business in CDN, but most of our CDN capability has really been about delivering applications on top of the CDN. We just didn’t really see that we had the scale and the ability to be a competitor there."

BitGravity announced a strategic partnership with Tata Communications, which will resell BitGravity's CDN service to its customers. Tata is based in India but has a presence in 200 countries.

Posted by Rich Miller March 06, 2008 | Permalink | Newsletter