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In the past 18 months, CDN and P2P based delivery vendors have raised over $300 million to build out and deploy content delivery services. So it should be no surprise to hear that BitGravity announced last week that it had raised $2.5 million from Allen and Company and Blake Krikorian, the co-founder and CEO of Sling Media

Adding up all the investments that CDNetworks, EdgeCast, Panther Express, Grid Networks, Highwinds,
Velocix, Itiva, Move Networks, Pando Networks, Conviva, BitTorrent,
ChinaCache, Rawflow, Oversi and BitGravity have gotten, and it totals $285.35 million. In addition to these sixteen providers, Kontki, SimpleCDN, Vusion and EdgeStream have all raised undisclosed amounts as well which puts the total amount of money raised into the CDN space well over $325 million. And if we think of AT&T’s CDN offering as a startup, which they basically are, with their $75 million investment into their network this year, that puts the total amount of money raised to over $400 million in the past 18 months.

In addition, while BitGravity is the latest to raise money, they won’t be the last. There are at least three to four new CDNs in the U.S. and Asia who are gearing up to enter the CDN market and have already raised, or are in the process of raising money. I am amazed that companies continue to be able to raise money for a new CDN business when there are already over 50 CDN providers and the market is not big enough, and won’t grow fast enough to support them all.

The CDN market is going to be in for a world of hurt in 18-24 months, and most of these CDNs are not going to get acquired or bought out at all, let alone at the kind of revenue multiple investors are dreaming of.

Since a lot of viewers are querying Google on how to watch the Olympics without having to use the Silverlight player and instead use the Windows Media player, here are the instructions.

Go to www.NBCOlympics.com and click on the video tab. Then click any video to watch and you’ll get a popup window with video in it. If you already have the Silverlight player installed it will automatically use that unless you click the "standard player" link. Doing that will put you into a single stream that uses the Windows Media player. If you do not have Silverlight installed, you will get the option to install it. If you don’t, you will just get a Windows Media based stream

Still having problems? E-mail me and I’ll try and help.

Last week I had a blog post talking about Microsoft’s Silverlight player and the Olympics and thanks to Google, many of the phrases people are typing into Google about the Olympics are bringing them to my blog. The interesting thing about this is that Typepad allows me to see what phrases people are searching for pertaining to Silverlight and the Olympics. I’m sure someone who knows Google better than I do knows of a place on Google’s site where you can see the most common searches for this subject, but looking at Typepad’s reporting gives me some interesting results.

While a lot of the search queries are very generic like "watch olympics" and "watch olympics with silverlight" many of them are very specific to problems people are having. I’m getting a lot of traffic from phrases like "silverlight admin", "silverlight buffering", "should I install silverlight", "silverlight olympic issues", "silverlight not working", "silverlight buffering problems", "olympics video player slow" and other assorted phrases. I’m also getting a lot of traffic from search results pertaining to people who want to use Windows Media to watch the Olympics instead of Silverlight.

By itself, these search phrases are not an indication that the Silverlight player or Limelight Networks are having any problems delivering the video. But it does serve as a reminder to us of just how many viewers still have problems with video players today. Some viewers are clearly having their own connectivity issues, don’t have admin rights for new player installs, don’t have the latest version of the player or don’t want to install a new version. And while some anti-Microsoft people are going to want to comment that this would not be the case if Flash was being used, think again. While I will admit that there would be fewer issues due to the fact that the Silverlight player is newer than Flash, using Flash would not solve the problem. The number two post ever on my blog, thanks to Google referrals is to a post entitled "MSNBC Debate Webcast Constantly Buffering, Poor Audio". I still get tons of traffic to this post as so many users still have problems with Flash video on MSNBC. This is primarily due to MSNBC problems, but it still shows that no matter what player(s) are used, especially for live events, viewers are always going to have a wide assortment of problems that reside on their end.

If you are a viewer who came across this post looking for help to watch the Olympics, send me an e-mail with the problem you are having and I’ll try and point you in the right direction.

In my eyes, there has been too much talk in the past few days from some analysts saying that Akamai should purchase Limelight. What I don’t see any of them explaining is what value that would have to Akamai other than to say it will remove a competitor from the market. So far, that’s all I see them saying. But what about the negative impact that acquiring Limelight could have on Akamai’s business? You don’t hear any of them talking about that or even running the numbers to see just how much Akamai would have to spend.

If Akamai acquired Limelight, they would have to spend a great deal of time and internal resources to see the acquisition through completion. Lots of technical resources would be expended by Akamai to transition customers over to the Akamai network and deal with all of the integration hassle. Akamai just spent the past two years doing all of the integration work from their acquisition of Netli and Nine Systems. The last thing they need right now is to take on more integration work that would be a lot more complex than the last two were. Plus, is now the right time for Akamai to be focusing on anything other than their core business? With the lower than expected guidance Akamai gave last week in their Q2 earning call, Akamai needs to continue to focus on their core business and growth. Acquiring a $100+ million dollar business is not the way to do that and I think Akamai is smart enough to know that.

In addition, Limelight would not be cheap. Even with the shadow that Limelight is under due to Akamai’s patent suit, Limelight is still close to doing $125 million this year in revenue. Akamai’s would still have to pay over $400 million for Limelight, even if Limelight eventually have to pay some sort of penalty to Akamai. Limelight is not is a desperate situation. They have cash, they have customers and they are not going away anytime soon. And if for some reason things got so bad at Limelight that they had to sell, you know they would shop the company to multiple players others than Akamai and get as much as they could for it. There is a good bet that many would pay more for Limelight, think telcos, than Akamai would be willing to.

But lets look past that and say Akamai acquired Limelight. What do they get? They don’t need Limelight’s network, don’t need their hardware and infrastructure, Limelight has no granted patents that I am aware of and has no applications or ecosystem components they own. Yes, Limelight has customers and revenue, which is all Akamai would want. But, what percentage of Limelight customers would Akamai keep in an acquisition? My bet would be less than 40%. If Limelight does $125 million this year, Akamai would add roughly $50 million to their top line revenue. And with 20 of Limelight’s customers making up 50% of their revenue, clearly Akamai could very easily get much less than 40% of Limelight’s revenue. And keep in mind that Microsoft likes to spread their business around to multiple CDNs. So the idea that all of a sudden Microsoft or other large content owners would all of a sudden consolidate all of their business with Akamai, or any single provider, just isn’t happening.

So does it make sense for Akamai to spend at least $400 million to acquire Limelight, have to use a lot of internal resources, increase their revenue by a small percentage and do all of that just to remove a competitor from the market? I don’t think so. I think too many people are looking to when Akamai sued Speedera and then acquired them and think the same will happen to Limelight. Great, but that’s not a fair comparison. The quarter before Speedera was acquired, Speedera did just over $8 million in revenue. Limelight is averaging 4x that per quarter. Speedera was acquired for $130 million in Akamai stock. It would take at least 3x that in order for Akamai to acquire Limelight.

That’s not to say that Akamai can’t acquire Limelight, anything can happen. But I don’t see any reason why they would or what they would get from it. Someone thinks otherwise, other than you own stock and want to see it happen, happy to hear it in the comments section.

The Streaming Media West show is only six weeks away and the program is just about complete. All final speakers are going on the website this week and due to a few last minute changes or cancellations, I have just three spots left. Below are the sessions and details. No other speaking spots remain. I appreciate the interest many of you have but this is all I have left and even the waiting list is longer than I could ever use. See the details below and send me an e-mail ASAP if you are interested. Many of these spots will close in the next 24 hours.

Speaking Details: I have one spot on each of the below round-table panels. I am not accepting any vendors at
this time, only content owners and customers. However, vendors are welcome to submit their customers for these spots.

Wednesday, September 24, 2008
Online HD Video: What’s Taking So Long?
High-definition online video content online has long been promised, yet the outlets for this vibrant media are few and far between. What is holding up adoption? What is stopping HD from reaching our desktops? We’ll explore this discussion from all fronts—technology, entertainment, and aggregation—to get a feel for what the holdups are and when we can expect to see more HD in the cloud.

Wednesday, September 24, 2008
Tools And Best Practices For The Enterprise Streaming Media Department
This session will bring together four frontline streaming media professionals to discuss their favorite toolsets and techniques for producing enterprise communications and training content. The emphasis will be on in-house production with "off-the-shelf" tools and apps, rather than turnkey or outsourced solutions. What works and what should be avoided? What is the best way to maximize your budget? How can you leverage existing infrastructure already inside your organization? This and more will be covered in this enterprise-focused session.

Wednesday, September 24, 2008
Evaluating and Choosing The Right Methods Of Video Delivery
With all the various means of distribution and protocols available for video today-CDN, P2P, streaming, progressive download-there is still no single solution that will meet all customers’ needs perfectly across all platforms and devices. Learn the various methodologies for content distribution, as well as the pros and cons of each type. Speakers will also discuss which methodologies apply best to which platforms and geographic locations based on type of content, length and format of video, and target audiences. Panelists will also provide you with guidelines and formulas for determining the best single and/or hybrid solution for your online video distribution needs.

While Limelight Networks has been getting a lot of media coverage over their NBCOlympics.com business, many have been wonder and asking what exactly is Akamai’s role for the games? On last weeks quarterly call, Akamai executives made references to their Olympics business but without any details, until now.

In an e-mail to me this weekend, which I am allowed to share, Akamai detailed what they are doing for the Olympics, the type of content they are delivering and the websites they are working with. While it is true that Limelight is delivering all of the video, live and on-demand for the NBCOlympics.com website, (with Level 3 as the backup should anything go wrong) Akamai’s network is being used to cache and deliver all of the static content for NBCOlympics.com. NBC is using Akamai for dynamic site acceleration, event planning and support and syndication services.

In addition to the NBCOlympics.com website, outside of the U.S. many other websites have rights to broadcast the games. Akamai is working with the European Broadcast Union to deliver Olympic video to the sites they support including Eurosport, TF1, Canal +, Y.L.E (Finland) and France Television amongst others.

In addition to the European Broadcast Union, Chinese portal Sohu, MySpace China, Tudou.com, PPLive and others are also providing Olympic content, but I don’t know who is providing the delivery of that content, exclusively in China. While ChinaCache would not go into many details, they did say that they are helping IOC rights holders like CCTV, QQ and others with over 100Gbps of Flash live and on-demand streaming. Updated: ChinaCache put out a release saying they are providing delivery for Sohu, People.com, Xinhua,
CCTV, QQ, Sina and China Online.

Naturally, some on Wall Street are going to ask me what type of traffic does Akamai expect from the Olympics and what type of impact will this have on their revenue? Since no one knows exactly how much traffic any of these websites will get, there is no way to know and Akamai did not provide me with any traffic estimates.

No doubt, the Olympics are going to be a big online event for all of the content delivery networks involved, who will see lots of traffic. But with only so many hours in the day, and thousands of hours of live and on-demand content available, how much can one really watch in a 10 day period? And the big question, which so far, no one has been able to officially answer for me is, how long will the Olympics video be archived on NBCOlympics.com? For the CDNs involved, the longer, the better.

Note: I asked additional CDNs in Europe and Asia if they were providing any content delivery services for the Olympics so they could be included in the post. Some didn’t respond to the request or stated they were not involved.

Liz Gannes, Editor of NewTeeVee.com is moderating a panel at the Streaming Media West show on Tuesday, September 23rd entitled "Online Video vs. ISPs: How Much is too Much?" What’s good for online video content publishers isn’t always good for ISPs, and more and more ISPs are considering throttling bandwidth or charging for fees as video streams and downloads increase exponentially. Can consumer desire for video and service provider limitations co-exist? Are content owners and the industry at risk of not being able to develop new business models from online video?

We’re looking for a few great panelists who can speak in detail on this topic and are from companies that have a vested interest on the content side or the ISP side. While I am accepting all submissions, we are looking for speakers from companies that are really tied into this subject and can speak from experience. We’ll be picking speakers in the next few days so if interested, e-mail me right away.

Make sure to send me the speakers name, title, company, bio and a very clear description of how this topic is relevant to the speaker and their company. If you know of someone who you think would be great for this panel, happy to have an introduction. If we choose them, I’ll give you a free all access conference pass to the show.

Note: I am wrapping up the final program for Streaming Media West and will be posting a few open speaking spots on the blog over the next few days.