Streaming Media - August/September 2008 - (Page 41)

Limelight will come up with a technical workaround to the Akamai patent (see www.cdnpatents.com). In the next 12 months, we should see a clear indication of who the top five or six providers are going to be based on revenue. The market for CDN services shows no signs of slowing down, and the demand for video delivery services will only continue to grow as longer form, higher quality content is played back more often and on more devices. Once online video advertising gets its act together and content owners truly are able to make money from their content, more content will be produced for the web and will be delivered by the CDNs. While I expect the number of CDN providers to drop dramatically in the next 18 months, that’s not a sign of a downturn. The reality is that there are more providers today than the market can bear, and the market will not grow fast enough in the next 18 months to support them all. When this happens, some will try to take it as a sign that the CDN market is slowing down, that customers are going to build out CDNs themselves, or that it’s too hard for the CDNs to operate profitability. This is not the case. Over time, CDNs will have to diversify into delivering more than just video content; some are already making that transition. While the market will always have some CDNs that specialize in delivering only video content, the more CDNs build out their networks, the more they will have to utilize their investments to deliver newer forms of content. Doing this over time, CDNs become less dependent on just one form of content delivery for their revenue and also begin to focus on the ecosystem components needed for delivering all forms of content. Content delivery will get smarter and more economical for the customer. CDNs will become better at scaling their networks to keep up with the demand and, I expect, they will do a better job of showing what their services are worth. While customers always want the price to be lower and some think that it will eventually evolve to the point where it is free, they will realize over time that all CDNs have a fixed cost and will always have to charge a base line for their services. Conclusion This market is really just starting to grow up and mature into a real business. I’m excited to see how the CDNs evolve over the next 24 months when this becomes a billion-dollar market for video delivery in the U.S. sometime next year. If you’d like to stay up-to-date on the CDN market and discuss what is taking place in the industry, you can follow along on my blog at www.contentdeliveryblog.com. Dan Rayburn (mail@danrayburn.com) is executive vice president of Streaming Media. Comments? Email us at letters@streamingmedia.com, or check the masthead for other ways to contact us. WWW.STREAMINGMEDIA.COM 41 http://www.cdnpatents.com http://www.contentdeliveryblog.com http://www.barix.com http://www.barix.com http://WWW.STREAMINGMEDIA.COM

Table of Contents Feed for the Digital Edition of Streaming Media - August/September 2008

Streaming Media - August/September 2008 Table of Contents No Doubt - Editor's Note Mo’ Videos, Mo’ Money: Solving the Problem of Network Cost Why Good Design Matters More Than Ever: Just. Press. Play. Technology and Business Trends by the Numbers High-Touch Encoding With Microsoft Expression Encoder 2 The State of the Content Delivery Market, 2008 Get a Life: New Tools Put Lifecasting Within Anyone’s Reach So Many Codecs, So Little Time: Comparing H.264 Files Using Codecs From Apple, Dicas, and MainConcept Writing an RFP for Maximum ROI: Things to Consider and Questions to Ask When Writing a Request for Proposal for a Corporate Webcasting System The Patent Wars Producing Screencams in Camtasia Studio Analyze That Using Video to Communicate Change for Business Success Intellectuals’ Property Rights

Streaming Media - August/September 2008

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