Contentinople Research Predicts CDN Shakeout

The debut edition of Contentinople Insider warns that a proliferation of content delivery network providers leaves the sector vulnerable to price erosion

PRNewswire
NEW YORK
Apr 22, 2008

NEW YORK, April 22 /PRNewswire/ -- TechWeb's Contentinople (http://www.contentinople.com/), the Website providing news and analysis of the digital media market, has launched a new subscription research service providing in-depth analysis of digital media technology trends, called Contentinople Insider (http://www.contentinople.com/insider). The first issue provides an overview of the content delivery network (CDN) market.

The number of CDN providers has more than doubled in the last couple of years, a development that is likely to create significant price pressure and lead to industry consolidation, according to Contentinople Insider.

Content Delivery Networks: Economic Challenges Ahead analyzes the CDN ecosystem, focusing on current and projected network deployments, demand drivers, and potential demand inhibitors. It explores the pros and cons of using CDNs from an enterprise perspective, emphasizing the types of applications and services that are best suited to commercial CDN services. The report also identifies and evaluates existing and emerging CDN delivery models, including hybrid peering CDNs. Finally, the report provides a detailed comparative analysis of offerings from the top 20 commercial CDN suppliers.

  For a list of companies profiled in this report, see:
  http://img.lightreading.com/cpi/pdf/cpi0408_companies.pdf

The economic underpinnings for the CDN sector are now shifting, due in part to the evolution of digital media companies, notes Martin Courtney, research analyst with Contentinople Insider and author of the report. "Major distributors of digital content, such as YouTube, MySpace, and Microsoft, are now taking the do-it-yourself approach to CDN -- a development that could threaten margins for commercial CDN operators," he says. "Despite an anticipated continued growth in Web-based rich media applications and Web 2.0 services, it's unlikely that demand will grow enough to sustain the current number of commercial CDN operators."

But culling the winners from the losers in this sector is not a clear-cut proposition, Courtney adds. One reason is that there's no single strategy for building and growing CDNs: Networks can be optimized for specific traffic types, such as video, or for applications that appeal to specific vertical enterprise markets. "No doubt, the largest CDN operators stand the best chance for success," says Courtney. "But well-focused specialists can also find lucrative niches that will yield medium- and even long-term success -- including an eventual buyout by a larger rival."

Other key findings of Content Delivery Networks: Economic Challenges Ahead include the following:

  -- Lower-cost, more flexible per-usage billing models are pushing CDN
     prices within sight of many SME/SMB budgets for the first time.
  -- Significant consolidation is expected as smaller CDN providers either
     are bought out or disappear.
  -- Next-generation and established CDN providers are starting to
     experiment with peer-assisted and hybrid CDNs, while many startup CDNs
     are now focusing exclusively on streaming video and IPTV delivery.

Content Delivery Networks: Economic Challenges Ahead provides critical data and analysis for a range of industry participants, including:

  -- Network operators needing independent market analysis of the CDN sector
  -- Digital media content providers evaluating commercial CDN service
     offerings or considering launching an in-house CDN
  -- Investors needing a better understanding of the scale of the
     opportunity that CDNs present, and which types of companies are best
     positioned in the sector

Content Delivery Networks: Economic Challenges Ahead is available as part of an annual subscription (six issues) to Contentinople Insider, priced at $1,295. Individual reports are available for $900.

Contentinople Insider is a brand-new research service that tracks, analyzes, and evaluates the key market and technology developments that will have the biggest impact on the digital media and communications industries in the months and years ahead. Starting with the first issue, each edition of Contentinople Insider will offer deep insight and hard-to-get market data and intelligence on the core issues facing industry participants and investors, such as:

  -- Content aggregation and distribution platforms
  -- Digital content development
  -- Video sharing
  -- Digital advertising infrastructure
  -- Mobile content platforms
  -- Media servers
  -- IP-aware set-top boxes and connectors
  -- Content delivery networks (CDNs)
  -- P2P technology and platforms
  -- Streaming video standards
  -- Digital rights management (DRM) software
  -- Networked consumer devices
  -- Content management platforms

Along with competitive product and strategic analyses, Contentinople Insider will deliver essential information not available from any other source, including:

  -- Full results of exclusive surveys of digital media industry
     professionals regarding spending and deployment plans for emerging
     products and technologies
  -- Up-to-the-minute details on technology and standards developments,
     including the latest information on commercial availability of new
     products and services
  -- Independent and unbiased assessments of vendor market positions and
     strategies
  -- Advance intelligence on product and standards developments that will
     have a direct impact on deployments of new technologies and services

To subscribe, or for more information, please visit: http://www.contentinople.com/insider. For more information about our other Insider research services, please visit: http://www.lightreading.com/research.

To request a free executive summary of the report, or for details on multi-user licensing options, please contact:

  Jeff Claudino
  Director of Sales
  Insider Research Services
  619-229-9940
  claudino@lightreading.com

  Press/analyst contact:

  Dennis Mendyk
  Managing Director
  Insider Research Services
  201-587-2154
  mendyk@heavyreading.com

  About Contentinople

Contentinople (http://www.contentinople.com/) is TechWeb's site for networking the digital media industry. Launched in 2007, the Website publishes news, analysis, and reports on enabling technology and business models being deployed in the digital media revolution. In addition to a fully staffed editorial Website, Contentinople is running a full program of live events and Webinars to help educate the market about trends in digital media technology.

About TechWeb (http://techweb.com/aboutus )

TechWeb, the global leader in business technology media, is an innovative business focused on serving the needs of technology decision-makers and marketers worldwide. TechWeb produces the most respected and consumed media brands in the business technology market. Today, more than 13.3 million* business technology professionals actively engage in our communities created around our global face-to-face events Interop, Web 2.0, Black Hat and VoiceCon; online resources such as the TechWeb Network, Light Reading, Intelligent Enterprise, InformationWeek.com, bMighty.com, and The Financial Technology Network; and the market leading, award-winning InformationWeek, TechNet Magazine, MSDN Magazine, Wall Street & Technology magazines. TechWeb also provides end-to-end services ranging from next-generation performance marketing, integrated media, research, and analyst services. TechWeb is a division of United Business Media, a global provider of news distribution and specialist information services with a market capitalization of more than $2.5 billion.

*13.3 million business decision-makers: based on # of monthly connections

SOURCE: Contentinople Insider

CONTACT: Jeff Claudino Director of Sales, Insider Research Services,
+1-619-229-9940, claudino@lightreading.com; or Press-analyst contact, Dennis
Mendyk, Managing Director, Insider Research Services, +1-201-587-2154,
mendyk@heavyreading.com, both for Contentinople Insider

Web site: http://www.contentinople.com/
http://www.contentinople.com/insider
http://www.lightreading.com/research
http://techweb.com/aboutus