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

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Less than a decade ago, "browse" was just another word for "window-shop," and most people had never heard of the Internet. From a business perspective, the years since have been a roller coaster ride, but the technological progress has been remarkably swift. A key driver of this innovation has been the impulse to enhance and expand end-users' content experience. That's what led to the development of the World Wide Web and its attendant browsers in the first place, and subsequently to the support for dynamic media such as audio, animation, and video, to the rapid refinement of codecs, and ultimately to the advent of Content Delivery Networks purpose-built to speed access to digital content.

While the end-user experience is as important today as ever, a tougher business climate is forcing reevaluation of CDNs' value. Some CDNs have simply fallen by the wayside, and the rest are under increasing pressure to justify their expense in terms of tangibles such as Return on Investment (ROI). Meanwhile advocates of CDN alternatives are arguing that the need for traditionally-defined CDNs is on the decline, and that competing approaches can better meet customer needs. With the content-delivery market in a state of flux, even some of the best-established companies are acknowledging that they will have to adapt to stay viable.

Enhancing Performance
The rise of the CDN came about in the context of rapidly expanding demands on Web sites, not only because of the amount of traffic they were called on to serve, but also because the type of content they were serving was increasingly rich, and thus bandwidth-intensive. For many companies, keeping up with these demands in-house became both a burden and a distraction. At the same time, broadband in the home was still a relative rarity and the delivery infrastructure was drowning in the sheer volume of data, resulting in a poor user experience that was giving the Internet a bad name: "World Wide Wait." Together, these two related trends created an opportunity for outside providers that were willing to take on the twin tasks of handling site traffic and bypassing network bottlenecks.

The first companies to dive into the field defined what has become a traditional approach to enhancing content delivery performance. Chief among these was Akamai Technologies, which currently claims over 80% market share in the "content delivery space." Bobby Blumofe, Akamai's VP for technology strategy, says that one core attribute of CDNs is an infrastructure that is globally distributed. "Size of deployment is important," he says. "There is a lot of value to being truly at the edge where the eyeballs are. You also need mapping technology that can ensure that end-users are always able to access a server that has the capacity to handle their request, and also is near enough to them on the network to deliver high reliability and performance when satisfying that request."

While differing over specifics of implementation, many of Akamai's competitors also operate on the premise of maintaining multiple points of service and determining which of these is likely to deliver to a given client most efficiently. "Akamai believes that the sheer scale of their global delivery network will assure better delivery results," says Gordon Smith, VP of marketing at competitor Speedera Networks. "But third-party testing results and customer experience does not bear that out. We look at where the user is, the network conditions at the time, and what application they want. Based on these variables, we then figure out the best place within our global network of servers from which to serve the content." 

According to Rob Friedman, executive VP of corporate development at Digital Envoy, which provides IP intelligence technology for the Internet, it's not necessarily possible to conclude that one or another of the traditional CDN approaches performs best. "Some CDNs deploy massive amounts of servers throughout the Internet," he says, "while others have more strategically placed servers. They each have a different story regarding why they are the best and the fastest. But they all have good performance; which is fastest often depends on a particular site's traffic patterns." 

Perhaps because, as Friedman sees it, customers view all CDNs as virtually the same when it comes to pure speed of content delivery, CDNs are aware that they also must address other customer concerns. "Localization/customization is at the top of all CDNs' lists," Friedman says. "Customers are running into the need to comply with legal requirements in streaming or downloading of content, such as U.S. regulations against making encryption software available to countries like Cuba. With geolocation, customers can obey these legal requirements." 

Friedman adds that the more value a CDN can add, the less likely it is that an enterprise will bring content delivery in-house because it becomes more difficult and time-consuming to replicate the CDN's built-in capabilities. "With value-added services such as geolocation," he says, "CDNs can offer customers a ‘one-stop shop.' In the next 6-12 months, we see this trend expanding as CDNs try to attract new customers and differentiate themselves from the pack."

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