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Folks have been speculating today that Global Crossing might soon enter the CDN space by reselling one of the current CDNs in the market. I can confirm that Global Crossing has already been working with Limelight Networks and started reselling their CDN offering over the past few weeks and plans to focus primarily on the European market. Folks inside the industry have been talking about this for awhile now, but the companies involved have been pretty quiet and not commented on the story.

Unique to the deal is that Global Crossing is also providing first level support for customers and is hooked into Limelight's network so that Global Crossing can do self-provisioning and real-time monitoring of the network. For Global Crossing, they get more than just a reseller type agreement and can take full control and responsibility for the customer. For Limelight, it allows them to try and penetrate the enterprise market which is Global Crossing's strength and a vertical that Limelight has been targeting in the hopes of diversifying their revenue across more than just media and entertainment customers.

In addition to Limelight, Global Crossing is also already selling EdgeCast's CDN services as well but I don't know the specifics around the support and provisioning on the EdgeCast network. Although based on what I know of EdgeCast's software, which is fully designed for resllers to completely manage customers on their own, I expect the deal to be similar to Limelight's, although the company would not comment.

While I expect we'll hear more details about this from Global Crossing at some time, what I'd really like to know is what metrics they plan to use to decide when to sell one CDN over another? Why would they tell one company to use EdgeCast over Limelight or vice versa? Is it simply based on price? Location of servers? I'd also like to know if Global Crossing has any sort of internal system setup where they can pass traffic from one CDN to the other without the customer knowing and basically load balance between the two.

David Vorhaus from Yankee Group Research put out a report this morning on the EdgeCast and Global Crossing deal but the report is not public for me to link to.

The advance program for the Streaming Media East show in May in NYC is now online. We've got roughly 35 sessions this year and about 110 speaking spots. I am starting to place speakers today. I have over 800 speaking submissions to go through but have already placed a bunch of great folks from Disney, Babelgum, boxee, ABC Television, MetLife, BusinessWeek.com, Tuner, Syracuse University and a few others. The process of placing speakers has just started, so if you see a session you think you need to be a part of, better contact me fast.

Here is a quick outline of the session titles, full descriptions can be found online.

• Bridging TV And Broadband And Cutting The Cable
• Streaming Production: Improving Your Video Quality
• Online Video And Set-Top Boxes
• Demo: Compelling Video Advertising Campaigns
• Using Metadata to Better Engage Your Audience
• Live Broadcasting with Mobile Phones, Consumer Cameras and Laptops
• How Old Media Is Embracing Online Video and New Media
• Content Production for the Web
• The CDN Ecosystem: Moving Beyond Bit Delivery
• Successful Content Syndication and Aggregation Strategies
• Monetizing Long-Form Video
• Can Broadband Network Operators Successfully Harness P2P?
• Media Framework: Video Publishing Platforms
• CDN Research Data: Market Sizing and Pricing Trends
• Implementing Flash Video DVR Functionality For Live Broadcasts
• Tools And Best Practices For Enterprise Streaming Media
• Best Practices: Marketing Video for Multiplatform Delivery
• Making Effective Online Video for Education
• Microsoft Smooth Streaming: Delivering HD-Quality Video Over HTTP
• Reinventing The Ad Model Through Discovery And Targeting
• The Impact Of Broadband-Enabled TVs, Gaming Consoles And Devices
• Automation And Workflow Solutions For Transcoding Your Video Content
• New Advertising Platforms and Networks
• Live Broadcasts And HD Video: Can Web Video Ever Scale To TV-Sized Audiences?
• Cost Savings from Enterprise Streaming
• Video for Distance Learning & Classroom Training

In addition to the Streaming Media East program, shortly we will publish the special one-day Content Delivery Summit agenda. Stay tuned

While Level 3 recently laid off part of their workforce in December, their CDN group is still hiring and has half a dozen open positions they are looking to fill today. The list they just sent me includes the following:

• CDN Product Manager – Broomfield, CO or Thousand Oaks, CA
• CDN Field Expert, Director Product Management – Washington, DC area
• CDN Operations Engineers – Broomfield, CO
• CDN Service Delivery Technicians – Broomfield, CO & Tulsa, OK
• CDN Account Directors – DC, LA, San Francisco

If you're interested, contact Mary Spuler at Level 3.

If your online video related company has any job openings, let me know. In many cases I will highlight them here on the blog – free of charge.

As an avid Mets fan, I check their website every day and within the past 24 hours, MLB put up a notice on all team pages that they have opened up MLB.TV for 2009 with cheaper rates than last year. MLB is once again going with two different options, a basic subscription service at $79.95 for the year and a premium service at $109.95 for the year. As the website points out, both of these packages are $10 cheaper than they were last year if you pay upfront. But for those who want to pay monthly, there is no discount being offered with the monthly costs being $19.95 for premium and $14.95 for the regular package.

In December, Major League Baseball Advanced Media (MLBAM) President and CEO Bob Bowman told PaidContent.org that in 2009, "…we have to lower our prices". Clearly MLBAM is looking to drive more subscriptions with a reduced rate and only offering the discount to those who pay upfront for the entire year is pretty straight forward. In addition to the lower price, the premium service comes with some new technology features enabled by MLB's switch to Flash in the beginning of the year. The most relevant of which is the ability to have DVR like functionality during a live game, a new feature of Flash Media Server 3.5 that Adobe introduced in November of last year.

MLB's premium service also allows for a new picture in picture feature and they also say HD quality is new for 2009. With the high-bitrate encoding MLB was doing last year, their video quality was already very good, taking it up to HD only makes the deal even sweater. I'm interested to hear the tech specs on how MLB is doing the encoding for HD video and what they will be providing.

As far as I am concerned, MLB is doing everything right with their online video offering in 2009 by giving us better quality, at a lower cost. Now if only they could figure out a way to get rid of all the blackout restrictions.

In a joint press release issued early this morning, Microsoft and Netflix announced that to date, Netflix members have streamed 1.5 billion minutes worth of videos to the Xbox 360 console. Considering the Netflix streaming service has only been available to the Xbox 360 console for the past three months, I think anyone would view that as a huge number with great success early on. To put that number into perspective as it pertains to bits delivered, since we know the technical details on how Netflix encodes videos, since November, content delivery companies Limelight Networks and Level 3 combined have delivered nearly 25 million GB of data. That's some serious traffic.

While the 1.5 billion minutes is huge, it's still very small when compared to the total minutes of content they ship via their DVD business. If we use the numbers Netflix has on their website, they ship around 730 million DVDs a year. If we use an average of 120 minutes per DVD, Netflix ships roughly 88 billion minutes of video in the mail, if I did my math right. So the streaming service is still very small in the overall picture but clearly has some really nice traction in only three months time.

The release also stated that Netflix's application for the Xbox 360 has been downloaded and activated by one million Xbox Live Gold Members but keep in mind that does not mean one million unique consoles since every Xbox Live account can contain multiple profiles or members. UPDATED: Microsoft's PR folks responded to my question on the one million number and said that the number of multiple gold account houses (on a single console versus two), where both accounts also have a Netflix subscription, has to be rare. So they wouldn't expect the correlative number of consoles to be anything less than around 95-98 percent of 1 million, if not higher.

These viewing numbers clearly highlight that the Xbox 360 console is by far the most important broadband connected device for the success of Netflix's streaming service. That really comes as no surprise considering that to date, Microsoft has sold nearly 14 million Xbox 360 consoles in the U.S., which is far more than the Roku, TiVo, Blu-ray players and broadband enabled TVs combined.

Hot on the heels of EdgeCast signing up Deutsche Telekom to resell their CDN services, EdgeCast announced another partnership this morning with managed hosting provider NaviSite.

This is a natural fit between the two companies and one of those deals where it doesn't look good just on paper. While NaviSite currently has some CDN service of their own, the company made a strategic decision almost two years ago not to invest any more money into their CDN business and to not come into the crowded CDN market. Probably a smart move on their part to instead focus on services outside of content delivery like managed hosting and application services.

Reselling the EgdeCast CDN will let NaviSite transition customers off of their infrastructure over time and also give them more services to sell since EdgeCast's CDN product has more functionality for things like streaming and support for Flash. This is also a good tie up between the two companies, as NaviSite already knows what CDN is, has the technical depth to understand the technology and should be fairly easy for their sales force to sell the offering. While NaviSite's sales force will now have the ability to sell more advanced CDN services, they are not looking to compete with the pureplay CDNs in the market and intend to focus on selling CDN to their current crop of customers.

EdgeCast says they have close to 25 resellers now for their CDN
services and have even more in the pipeline. I like the way EdgeCast is
using other companies to act as their sales force and letting the
channel of resellers push customers onto their network. It's a smart
move for EdgeCast as they have managed to sign up over 300 customers to
date, while only having raised a very small amount of capital. Since
launching, EdgeCast has stayed very focused on going after medium sized
customer and is not getting caught up in trying to focus on the really
large content owners that all the other major CDNs seem to be fighting
over.

After Netflix gave earnings last week, various news sites pointed to Netflix's streaming service as the reason why Netflix earnings beat estimates. Most seem to attribute this to the comment Netflix's CEO said on the earnings call, which was, "It's very clear that streaming is energizing our growth."

What I didn't see anyone asking is what "growth" Netflix was talking about? Since the CEO didn't elaborate on exactly what he meant, too may people assumed he meant revenue or subscriber growth, which is not the case. I was going to just leave it alone and not even blog about that point, but a week later folks are still talking about this and also being way too vague about the Netflix content offering as well. Today I read an article about the success Netflix is having with their "digital downloads", which sounds great, except for the fact that Netflix isn't in the "digital download" business. Netflix doesn't download anything since they stream all of their movies to multiple devices.

This may seem like I am splitting hairs over terminology, but I'm not. It's important to break out the market from digital download services like iTunes and others versus the streaming media service that Netflix offers where the user never owns any actual piece of content. We've got to talk about this technology right and we have to make sure expectations are set properly.

Getting back to my main point, at no time on the earnings call did Netflix say that the streaming service allowed them to beat or increase their earnings. In fact when I asked them for more details about this after the call, Netflix said the exact opposite, saying, "Reed Hastings was referring to growth in the generic sense, not tying specific subscriber growth, revenue or earnings to the success of streaming.  We haven't said that instant watching has driven a specific number of new subscribers."

Netflix was very forthcoming with this and made their point very clear in their follow up response. Did anything think of actually asking Netflix what they meant on their earnings call before they ran with stories proclaiming streaming as the reason they beat estimates? Sure, one can speculate that down the road their streaming service could generate a whole new business model, or earn them revenue in some other way, but right now no one can say they make more money simply because they have a streaming service.

The fact that they are seeing an increased demand for their watch now service might indicate that over time, Netflix can increase their P&L if it is cheaper for them to deliver a movie via streaming as opposed to having to pay to ship a DVD to and from the customer. Streaming could be a cost savings but that will only happen with serious economics of scale and with the DVD business growth slowing, which Netflix does not see happening until 2012. We don't know what it costs Netflix to stream a single movie and the watch now service could actually cost Netflix more money if the convenience of being able to see movies at any time allows a member to consume more movies instantly then they would ever get if they were only coming in the mail. These are all speculative questions since Netflix has yet to break out numbers for the digital portion of their business but right now, Netflix's streaming service is not increasing their revenues.