Is the Akamai vs Limelight Lawsuit Still in Play


According to PATENTLYO, the Supreme Court is moving to review the patent infringement lawsuit filed by Akamai/MIT against Limelight Networks. The lawsuit began in 2006, when the CDN industry was much different then. Limelight was the #2 CDN, right behind Akamai, and they did phenomenal job at taking business away from Akamai.

In 2006, Linkedin, Twitter, Facebook, Amazon AWS, and many other Internet giants either didn’t exist, or were a blip on the radar. Fast forward to 2014, the CDN Industry is totally different now. There are 20-30 CDNs globally, dozens of free open source caching platforms, advanced routers that are feature packed with extensive enhancements, IP infrastructure in emerging countries that are up to par with US/Europe, and next generation mobile networks in some APAC countries that are further along than in the US.

With this in mind, why is Akamai still suing Limelight for Internet technology that is now ancient in today’s connected world? First of all, Limelight is no longer Akamai’s biggest threat, that title belongs to Amazon and Verizon.

If Akamai is trying to hurt Limelight in their pocket book, I don’t know if that’s going to happen, since Goldman Sachs owns a big percentage of the company. Akamai’s $208M of net income in 2012 is monopoly money to Goldman Sachs (GS), which generated $7.2B in net income in the same period. And I don’t think GS is going to let Limelight out to dry, with its 500+ hard working employees

Akamai should focus on its future, not its past. Limelight is the past. Amazon & Verizon are the future, and the new threat. What does Akamai gain in the lawsuit? Even if it wins a $50M judgement against Limelight, that money isn’t really going to make a dent on Akamai’s financials. If there is infringement, and Limelight has to pay a tax to Akamai for using its network, it’s probably going to impact all other Internet companies including Google. I don’t know if Akamai wants to mess with Google.

Google can swoop in, at anytime, and acquire Akamai at the blink of an eye. If that happens, I bet Google will open source all Akamai’s intellectual property. That’ll be good for Akamai’s shareholders, however, it won’t be good for Akamai’s employees.

I have a better idea for Akamai. Why doesn’t it use that lawsuit money, say it’s $10M, and hire 50 brainiac’s that just graduated from college. Any graduate that has an offer from Google, get’s put on top of list. If Google pays them $90k annually, then Akamai can pay them $150k annually, put them in a cool office in Hollywood, and have them work on the next generation software platform that is going to rock Amazon AWS cloud business.

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