EdgeCast Gets $6 Million, AKAM & LLNW Get The Finger
Content delivery network EdgeCast has raised $6 million in Series B financing, led by Disney-affiliated (DIS) Steamboat Ventures. The company will use the money to build out its infrastructure, grow internationally, and expand its sales and marketing teams. EdgeCast has now raised $10 million to take on industry heavyweights Akamai Technologies (AKAM) and Limelight Networks (LLNW), which have had to cut prices to keep up with cheaper players like EdgeCast, Level 3 (LVLT), etc. And the pricing pressure has spooked some investors. From 24/7 Wall St.:
Research firm Kaufman put "hold" ratings on content deliver networks Akamai (AKAM) and Limelight (LLNW) with price targets below where the stocks currently trade. ... Companies can get into the CDN market for a few hundred thousand dollars. And, the market is flooded with capacity. ... Until some of these smaller CDNs are bought out or fail out of the market, it is going to be hard for AKAM and LLNW to move up.
See Also: CDN Market Ripe For Consolidation
Disclosure: SAI chairman Kevin Ryan is CEO of (and an investor in) Panther Express, a NY-based CDN.
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WOW.
EdgeCast has raised $10 million so far. If they can be in this space for only a fraction of that, then why raise the money? It is absolutely crazy how little people actually know about the CDN market but then make comments about it that are not factually correct.
And as much as people want to compare Amazon to CDNs like Akamai, Limelight and EdgeCast, it's a lack of understanding for what Amazon's S3 service does and does not do. Amazon's service does not support delivery via streaming protocols, it does not provide global delivery, it does not provide comprehensive reporting specific to video, it does not scale like a true CDN does etc.... not opinions, facts.