Akamai's Future Seems Unfazed by Apple's Reported CDN Build

 Akamais Future Seems Unfazed by Apples Reported CDN Build

When the WSJ speculated earlier this week on the consequences of Apple's apparent ramp up of CDN specialists, indicating a build of their own Content Delivery Network, the next obvious question to be asked was how will this impact their major suppliers: Akamai and Level3?

Most commentators have concluded that the benefits to both Apple and their customers will be a considerable improvement in quality and capability in delivering apps, movies and music. All would potentially download faster if Apple controlled the entire CDN chain, with less dependency on third party networks. This will, they say, also give Apple greater capacity for increased iTV channels and i-Cloud services.

However the WSJ reported late yesterday that 'Apple’s effort to build its own data-intensive Web network hasn’t clouded the outlook for Akamai Technologies, if the Internet company’s latest financial results are any indication.'

Apple is thought to be Akamai's largest media client, so you would think their shares would have taken a tumble on the back of this latest speculation. On the contrary, Akamai shares are up 18% after hours last night to $56, their highest level since the dot-com boom according to the WSJ.

In fact fourth - quarter profit in 2013 was up 18% off the back of increased demand for streaming video and online shopping. Apple are also thought to have struck a new contract this year on more favorable terms, however profit predictions at Akamai are still bullish at 21% this quarter.

Akamai's CEO Tom Leighton hinted at the news that Apple may be thinking of going it alone with the comment to industry analysts that, “Any very large media customer at one time or another is looking at a do-it-yourself solution. It’s a lot harder than people think, though. What may have seemed like a good idea at the time, over a period of years, often doesn’t."

I guess if you were the market leader in CDN services with over 150,000 servers globally and had already seen the likes of Netflix go with their own network, then you know that the overall increased demand by consumers for VOD and high speed shopping experiences means that you probably have little to fear.


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Posted in Video Technology
About the Author -
Dave Holland joined ReelSEO as Events and Commercial Director in 2012. His enthusiasm for video marketing is contagious and has been the driving force behind his development of video tools and platforms for multiple global clients over the last 5 years. View All Posts By -

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