Anywhere Scorecard Buzz: Content Delivery Networks

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 1August 2009Anywhere Scorecard Buzz: Content Delivery Networks© Copyright 2009. Yankee Group Research, Inc. All rights reserved. www.yankeegroup.com

Anywhere Scorecard Buzz:Content Delivery Networks

August 13, 2009

David Vorhaus, Senior Analyst

Zeus Kerravala, Senior Vice President

© Copyright 2009. Yankee Group Research, Inc. All rights reserved. Page 2August 2009Anywhere Scorecard Buzz: Content Delivery Networks

Agenda

• Introducing Yankee Group Anywhere Scorecards

• The Lay of the CDN Landscape

• Anywhere Scorecard for CDNs

• Summary and Conclusions

• Q&A


What Are Yankee Group Anywhere Scorecards?

• Rank products and services in markets impacted by ubiquitous connectivity

• Objective, rigorous, data-driven methodology• Evaluation criteria based on two key categories:

Vision (variable list)•Capacity•Ubiquity•Openness•Network Centricity•Innovation•Context Awareness•Usability•Convergence•Other Attributes

Ability to Transform (fixed list)•Ecosystem•Portfolio/R&D•Management•Customer Base•Brand Reputation•Pricing•Financial Viability


Scorecard Ranking Definitions

Exemplary Vision and Ability to Transform. Often the strongest reputation among customer base and established track record for product or service excellence. Recommended.

Good Vision and Ability to Transform. Often have overwhelming strength in one category but slight deficiencies in the other. Primed to move up to Front-runner status. Recommended.

Limited, but still noteworthy Vision and Ability to Transform. Not recommended across the board, however may be recommended in very specific circumstances.

Vision and Ability to Transform are lacking. Unlikely to be recommended.

Scorecard graphic provides a visual ranking of vendor results.


Additional Scorecard Basics

• Upcoming scorecards, to be updated annually:• Virtual desktop and application virtualization• Carrier Ethernet transport• Service delivery platforms• Mobile operating systems

• More information• See our Anywhere Scorecard Guide for more detail on methodology

www.yankeegroup.com/research/anywhere_scorecard.pdf• Recommend a scorecard topic at [email protected]


Agenda





• Q&A


Level Setting: Content Delivery Networks

• The concept behind a content delivery network

• Dedicated network of servers distributed strategically

• Localize delivery to ensure speed, quality and reliability of distribution

• Who buys CDN services from third parties• Enterprises for internal distribution• Consumer content providers for

widespread distribution

• The role of CDNs in the network is expanding• More high-volume, high-value content distributed to broader range of end-users• Content owners looking to assure quality/drive revenue can’t rely on public

backbone


Trends Molding the CDN Market

• Large number of undifferentiated players• 30+ CDN players with relatively similar core offerings• Competitive landscape overinflated, significant consolidation in next 12 to 18

months

• Downward pricing pressure for core services• HTTP object delivery is low-margin game • Pricing will asymptote to commodity levels within 24 months

• CDNs broadening out to incorporate ancillary services• Key services: content management, reporting/analytics, security, metadata

extraction, ad insertion, encoding/transcoding• Larger CDNs looking at whole site acceleration and application acceleration

• Encroachment by external players• AT&T, Level 3, Global Crossing, Deutsche Telekom, KPN, Tata, Verizon,

Alcatel-Lucent, Cisco, etc.• Driven by cost savings and revenue generation


Content Delivery at the Nexus of Two Bundles

• CDN is increasingly part of bidirectional bundling opportunities.• First is “premium CDN” bundle, with content delivery at center of a digital media

distribution strategy.• Second is wholesale bundle, with CDN as a piece of a broader communications services

package.

• The ideal solution is a CDN that can build the premium bundle, partnering with a carrier with strong wholesale assets.


Agenda





• Q&A


Anywhere Scorecard Methodology

• The basis of the CDN scorecard is primary research with vendors (scorecard participants) and existing/potential customers.

• Ten vendors are selected, based on those that develop their own CDN services and are most relevant in the market today.

• Scoring is done in two broad categories: Vision and Ability to Transform.

• Vision: Strategy in CDN space, available services and functionality• Ability to Transform: Core business metrics that will help dictate attractiveness

• Scorecard is done from the customer’s point of view.


Top-Line Results: Akamai and Limelight Are Front-Runners


Detailed Scoring of the CDN Market


Agenda





• Q&A


Summary and Conclusions

• The next 12 months will see continuing upheaval in CDN space.

• The growing importance of content delivery will be counterbalanced by declining pricing and market consolidation.

• Cloud-based enterprise services, mobile content delivery and advanced streaming capabilities are important areas to watch.

• Carrier encroachment will be the most transformative trend.

• Customers and partners should use the Anywhere Scorecard as a guidebook to match vendor strengths to their particular needs.


Additional Resources

• Yankee Group Research Reports:• Yankee Group Anywhere Scorecard: Content Delivery Networks, 2009

by David Vorhaus• The Fate of the CDNs by David Vorhaus• Carrier Encroachment Into the CDN Marketplace by David VorhausDownload the reports at http://www.yankeegroup.com

• Yankee Group blog:• Guiding Content Delivery Decisions by David Vorhaus• The Carriers Are Coming! by David VorhausRead more at http://blogs.yankeegroup.com/

• Yankee Group Scorecards Learn more at http://www.yankeegroup.com/linkResearch.do


David Vorhaus, Senior Analyst, [email protected] Kerravala, Senior Vice President, [email protected]

Next Yankee Group webinar:Getting Consumers’ Attention with Anywhere MediaAugust 25, 2009Register at www.yankeegroup.com

Thank you!

Technology

Anywhere Scorecard Buzz: Content Delivery Networks