Akamai is out and Verizon EdgeCast is in. We never saw this coming. Distil Networks and Verizon EdgeCast have formed a partnership, where Verizon will resell Distil Network’s bot mitigation products. Distil Networks is the market leader of the growing bot mitigation segment. Although this is only a partnership at the present time, we know how the story goes. Verizon will spend a ton of money on developing the partnership, then learn the product and target customer inside-out, finally they will buy. Verizon will follow the same process as they did in acquiring EdgeCast.
Verizon has likely realized two things: 1) they are not a powerhouse in developing new cutting edge products, therefore they will follow in Akamai’s footsteps and become an acquirer and 2) they don’t have a choice in the matter. Verizon must acquire Distil Networks in order to remain competitive in the Edge Security space, especially with Akamai acquiring like mad. CDN is a commodity, and WAF + DDoS Mitigation is going in that direction. Sophisticated bot mitigation is the next phase of the Edge Security life cycle. Distil Networks will give Verizon the edge over Akamai in bot mitigation. The question now is how much will Verizon acquire Distil Networks for? Our guess is $400M, which will be a little more than they paid for EdgeCast.
We know its premature to give congrats on the coming acquisition but we’ll do it anyways – congrats to Rami and Elias for a job well done.