Delivering Under Pressure: Business belt-tightening accelerates consolidation and adaptation on the Content Delivery Marketplace

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Other observers are less upbeat. "It's pretty slow because companies have held back their investment dollars," says John Jebens, director of solutions engineering at WAM!NET, a global provider of digital content management and distribution services via a private, managed network. The slowdown, he says, persists despite the fact that the advantages of a private delivery network in areas such as security, reliability, and timeliness translate into a demonstrable ROI. "People are seeing the value of a true content-delivery mechanism, but some companies are still holding back to see what the future economic climate will be."

Because of the tighter-fisted environment, companies have to work harder to make their case to potential customers. "It's forced us to create the tools to help our customers understand the benefits of our offerings," says Blumofe. "There's ‘hard ROI'—bandwidth and infrastructure savings—that is easy to measure. But there's also ‘soft ROI,' the value of an application running more reliably with better performance and better security. This ROI really depends on what the application is. In ecommerce, it could mean an increase in conversion rates, meaning not having customers just browse and then go away. Soft ROI can be quantified, but it's a little bit harder to do."

Alternative Approaches
While CDNs refine their marketing to reflect prevailing circumstances, they also have to keep an eye on alternative conceptions of how best to address content-delivery needs. One possibility is to avoid as much as possible of the terrestrial network by moving toward satellite delivery. "Content should be delivered directly to enterprises' networks, thereby bypassing Internet logjam points," says Joe Amor, VP & GM of Microspace Communications, which provides broadcast video, data, and audio satellite services for business applications. "Our services are currently received by more than 300,000 receive sites every day, and many of our customers are saving 50%, 75%, and, in one case, over 98% by using Microspace as opposed to terrestrial technology. Receiving devices have become easier to implement and add into corporate networks, and we're optimistic that more of these networks will deploy into the existing infrastructure."

WAM!NET's Jebens, however, characterizes satellite delivery as a receive-only option. "When you see the difference between download and upload specifications," he says, "it becomes evident that terrestrial and certain wireless networks will always outperform satellite, except for in broadcasting applications—send once, received by many." Smith agrees, saying that the satellite technology is "limited in terms of the services for which it makes any sense. Live streaming would be the obvious candidate, but that's a small part of the overall CDN industry."

Another non-traditional approach that's being promoted as a CDN solution, at least for internal enterprise applications, is to not only serve content to PCs, but from them as well. To make it work, Kontiki offers its Delivery Management System, grid computing software that pulls together existing networks and storage space on both PCs and servers to create a network capable of delivering rich media. The company claims network efficiency gains of 10 to 25 times over traditional delivery methods, and cost savings of greater than 90%.

Given the variety of alternatives vying for a piece of the content delivery pie, CDNs will likely be looking over their shoulders for the foreseeable future. Once the economy shakes off its doldrums, however, the pie itself may begin to grow at a rapid clip. That's because, even though the Internet and intranets are far more deeply integrated into personal and professional life now than when the CDN concept first arose, there's still a long way to go before the user-experience they offer approaches the seamlessness of media such as DVD-Video or broadcast TV. That performance gap presumably represents a huge long-term opportunity for CDNs, as well as for others who find profitable ways to tap this need for speed.

Companies Featured in This Article

Akamai Technologies, Inc.
Conxion Corporation
Digital Envoy
Microspace Communications Corporation
Mirror Image Internet
Speedera Networks

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