Nasdaq Halts Trading in ChinaCache

It wasn’t supposed to be like this. 

With a population of 1.38B and more than 800M Internet users, China is the fastest-growing CDN market in the world. And ChinaCache was the first CDN in China. They were founded in 1998, the same year as Akamai. Executives that are currently working for competing China-based CDNs have worked at ChinaCache. They have become a CDN School of sorts that serves as the training ground for the next generation of CDN visionaries.     

Although Akamai and ChinaCache were founded in the same year, Akamai is now valued at $13B and is likely to generate ~$3B in sales this year. ChinaCache is valued at $22M and annual revenue has been declining steadily over the years. Now it’s somewhere under $150M per year and their stock is trading under $1.     

On July 9, ChinaCache received a delisting order from Nasdaq, which it plans to appeal.  A lawsuit against ChinaCache reaveled that the CEO and Chairman is under criminal investigation by the Chinese government for bribery, as a result, he resigned from his position. 

Not only does this impact ChinaCache but also its customers. There are some big US customers using ChinaCache for delivery in China such as Microsoft and LinkedIn. Hopefully, something positive will come about from this tragedy.