Media Companies Should Continue To Choose CDN Network Performance And Scalability Over Price

Darren Aftahi, VP of Digital Media Research at ThinkEquity Partners has some of the best institutional research in the Analyst community about companies in this space. While he covers a broad spectrum of digital media technologies, much of what he writes about has to do with content distribution and online video.

I’ll be doing a round up of all the analysts I like in this space over the next week or so. If you are an analyst that wants to get on my radar please contact me ASAP.

This morning, he did a write up on Akamai’s stock price and one of his points in his brief was that "Media companies should continue to choose CDN network performance and scalability over price, to enable their online media businesses, especially when models are monetized via advertising dollars." It’s a great point and one that many media companies don’t adhere to. Many major media companies I speak to always seem be looking for the lowest price as opposed to the lowest price WITH good performance.

As content delivery pricing has already pretty much hit rock bottom, I expect we will start to see customers become more aware in the market in regards to more than just price. I think in many cases, we are already starting to see companies win business based on performance, customer service, reporting and other value add services, which in my mind, aren’t really value add, but more things that you HAVE to do right if you want to keep customers happy.

I am already starting to see the signs of the price per GB delivered going up slightly from where it was last year and the content delivery networks not prcing large volume deals as low as they use to. It’s not a drastice change, but I expect that by the end of this year, we will actually start to see
prices for content delivery rise for the first time in many years.