Wednesday, July 9, 2008

Yankee: Carriers likely to acquire CDNs

Potential M&A in the CDN sector and a few other comments:

>>Yankee Group analyst David Vorhaus this month issued the first Yankee Group CDN scorecard, designed as a means for both service providers and content owners to evaluate what has become a sometimes confusing plethora of CDN options based on key criteria such as price, brand recognition, financial viability, ancillary services, architectural approach and management.

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Even at its projected growth level, however, AT&T will only be at 10% to 20% of Akamai’s CDN capacity, Vorhaus pointed out.

“No service provider is going to be able to come in and build this sort of capacity right off the bat just because they are AT&T or Verizon,” Vorhaus said. “That’s why Level 3 [Communications] bought a CDN company [Savvis’s]. And it makes a lot of sense for AT&T, Verizon, BT or even Level 3 to buy one of the many CDN companies out there now.”

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