Today is a big day in the world of CDN consolidation. There’s a very fierce battle going on behind the scenes in the global CDN market and very few folks are aware of it. Akamai isn’t the only CDN with an appetite for acquisition. Armed with a $600M war chest, ChinaNetCenter just acquired CDNetworks, and the ramifications are going to ripple into the next decade.
ChinaNetCenter acquired CDNetworks for 21.1 billion yen, making ChinaNetCenter the largest CDN in China and #2 CDN worldwide, where their combined annual revenue is north of $500M. That in itself isn’t that big of a deal. However, in other parts of the world, ChinaNetCenter has acquired a Russian CDN which appears to be CDN-Video with “400 servers located in 17 cities in Russia” as well as the CIS Region (Ukraine, Kazakhstan, Georgia, etc).
And Why is This Such A Big Deal?
We’re going to put on our worldview hat for this one. There are 7 major regions in the world that are of importance to the CDN. Although some of these regions have a lower rate of last-mile broadband adoption, they will eventually grow that over time. Plus, let’s not forget that these regions have very large populations.
- North America
- South America
- CIS Region (Russia, Georgia, Ukraine….)
Of the regions listed above, Akamai dominates North America and ChinaNetCenter dominates China. In APAC, they are both duking it out. For Africa and India, all you need to do to build a large CDN footprint in the country is money and connections. In the CIS region, ChinaNetCenter is making moves to become a dominant player there. This leaves South America on the table. And we know that South America means Brazil. And Brazil is like China, in that money and connections won’t do much good there in building a large CDN footprint. For many reasons, those two markets are closed to the majority of CDNs. But not if you’re Akamai or ChinaNetCenter. The next logical step for ChinaNetCenter is to expand in South America, which means Brazil.
Akamai generates somewhere in the range of $50M to $100M annually in Brazil via a partner. And there is only 1 pure-play CDN in Brazil who competes with Akamai and that’s Azion. Azion is the only true competitor to Akamai in Brazil. Thus, if ChinaNetCenter acquires Azion, then the two will duke it out in South America for a long time. If Akamai acquires Azion, then Akamai will lock out ChinaNetCenter and all other CDNs from that market. And let’s not forget that eventually 5G and last-mile high-speed broadband adoption will explode around the world in a few years, making 4k streaming and many new high-bandwidth applications a reality. The for sure winner in all of this is Azion, because Azion makes out like a bandit regardless of who acquires them.
Who is Azion
- Largest Pure-play CDN based in Brazil
- 1k+ customers and strong presence in Latin America’s biggest companies including ecommerce, education, finance and media
- One of the most advanced software stacks in the industry, with a real time even driven platform
- Products: Content Delivery, Application Acceleration, Image Optimization, Load Balancer, WAF, DDoS Mitigation, Cloud Storage, Live Ingest, Media Packager, Real Time Analytics and Data Streaming, including a few options for advanced Integration Services and Support.