Akamai Acquires Velocitude, Mobile Focus Is Enterprise, Not Entertainment

Screen shot 2010-06-10 at 12.50.13 PM This morning Akamai announced it has acquired privately held Velocitude, which operates a platform for customers using mobile video for commerce and marketing purposes. Terms of the deal were not announced but I would not be surprised if Velocitude’s business was valued at under $15M.

While many seem quick to want to compare Akamai’s acquisition of Velocitude to Limelight’s acquisition of Kiptronic last year, they are two completely different solutions. Kiptronic’s platform is focused on helping content owners in the media and entertainment vertical monetize their video content by using amongst other things, campaign managers and ad servers. Velocitude’s platform is focused on helping content owners in the retail, government and enterprise sectors display and deliver mobile video for commerce and marketing purposes and is not used today for delivering ads to mobile devices.

Akamai clearly uses the word enterprise in the release, three times in fact, and never once uses the phrase media and entertainment. So why some posts are mentioning Netflix in their coverage of this news makes no sense. If Akamai wins Netflix’s business for delivering video to the iPhone when it is released later this summer, that won’t be as a result of the Velocitude acquisition. One has nothing to do with the other.

Akamai’s acquisition of Velocitude really comes as no surprise since the company continues to forge ahead in the enterprise space developing and deploying more and more services specifically targeted for enterprise and retail customers. Akamai’s focus has been and will continue to be on the enterprise vertical and while they aren’t giving up on the media and entertainment space, or ceding ground in that market just yet, enterprise services are clearly how Akamai plans to grow the company moving forward. This is quite different from Limelight’s focus which while still targeting customers in the enterprise and retails verticals with a limited product set, their main focus is still solutions for content owners in the media and entertainment verticals.

I don’t know what the size of the enterprise mobile video space is or what the market opportunity is projected to be, but I would expect that we’ll see Akamai give out some details on this segment of the market sometime after their integration of Velocitude’s platform is complete.