Can Akamai Ever Be Challenged

Akamai has dominated the CDN industry for the last decade in the revenue category. Limelight Networks (LLNW) came the closest in 2007 as show here:

  • Akamai 2007 Revenue – $636M
  • Limelight 2007 Revenue – $103M

Akamai was only 6x bigger than LLNW in 2007. Seven years later, they are a dozen times bigger. Not only has the revenue gap widened between Akamai and LLNW, the gap had widened between Akamai and all other CDNs. Can Amazon CloudFront ever challenge Akamai? Get outta dodge. Can Level 3? In your dreams. Can CloudFlare? Nope, not even with their $1B price tag. Can EdgeCast? Let’s think about it, nah. Can IBM, Cisco or HP? Yes, psyche. Not a chance.

Level 3 is dominant in the media services category working with VOD heavy platforms and broadcasters, but that market represents only a piece of the overall CDN pie. Amazon has Microsoft and Google to worry about in the compute and storage market, diverting too much attention away from its CDN. EdgeCast is Verizon now, and Verizon probably doesn’t even know what their going to do with EC.

Maybe in this lifetime, where the odds are 1 in 1,000,000,000, we’ll see a start-up CDN generate this kind of revenue:

  • Year 1: $1M
  • Year 2: $5M
  • Year 3: $25M
  • Year 4: $150M
  • Year 5: $400M
  • Year 6: $1BM
  • Year 7: $2.2B
  • Year 8: $3B

What is the first thing the an innovation driven CDN should do if it hits this kind of growth trajectory? This first thing they should do is call out Akamai to the floor, and invite them for a dance cause their one hot stock.

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