Akamai launches wholesale CDN offering

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Akamai launches wholesale CDN offering

Adrian Drury and Paris Burstyn/ Ovum  |   March 05, 2012
OvumAt the end of February 2012, Akamai, a leading cloud and content distribution supplier, took aim at wireline and wireless network operators – not as its traditional competitors, but as potential customers and partners. It launched Aura Network Solutions as a wholesale vehicle to enable operators with content delivery network (CDN) aspirations to take advantage of Akamai’s technology.
 
We believe operators may be able to take advantage of the Akamai technology–based solution to augment and extend their nascent CDN solutions. However, many major operators have already committed to their CDN architectures either by building capacity or acquiring complementary CDN operators.
 
Akamai’s Aura Network Solutions gives network operators three options:
 
- Managed CDN
- Licensed CDN (LCDN)
- Smart Cloud Accelerator.
 
The Managed CDN is a turnkey CDN using dedicated capacity to the operator’s business that Akamai manages on its infrastructure. With the LCDN, operators license Akamai’s edge-server software to build and manage their own CDN capacity inside their networks. The Smart Cloud Accelerator provides CDN and caching capabilities using Ericsson’s SmartEdge Border Network Gateway and Mobile Packet Gateway.
 
We believe Akamai wants to use Aura Network Solutions to expand its total addressable market by providing solutions to operators. The operators will serve as intermediaries between Akamai and end customers to which Akamai could not effectively or efficiently sell its CDN services. In addition, Akamai is looking to extend its business from a purely CDN capacity market with increasingly thin margins towards a higher margin software solutions and managed services business.
 
Akamai has already embarked on a value-added service strategy with programs such as the Akamai HD Network – effectively a video service management platform – and it has seen the writing on the wall. The standalone CDN market is in a race to the bottom, and Akamai wants to play a new game, one in which the operators can leverage Akamai technology to counterbalance contracting margins via integrated solutions including CDN, hosting, storage, applications hosting, and other cloud services. At the same time Akamai is able to promote itself as a truly differentiated provider.
 
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