Over the past few weeks, there’s been some acquisitions in the infrastructure space that I didn’t get to blog about. None of them are game-changers or dramatically change the landscape for those who offer distribution services, but they are interesting ones to watch with regards to how their technology will be integrated into the larger content delivery ecosystem.

• 21ViaNet acquires FastWeb: Last week, Chinese web hosting service provider 21ViaNet announced they had acquired FastWeb, a China based content delivery network. 21ViaNet is one of China’s largest carrier-neutral Internet data center service providers, with more than 150 POPs in the country, yet they didn’t have any kind of CDN offering. So on paper, acquiring FastWeb makes a lot of sense and the company says they plan to use FastWeb’s CDN services to “diversify” revenue and improve the quality and reliability of their services. Terms of the deal were not disclosed and I haven’t heard any rumors on the evaluation.

• Akamai acquires FastSoft: Two weeks ago, Akamai announced they had acquired FastSoft, a six year old company that was offering network optimization technology originally developed at the California Institute of Technology and funded by the National Science Foundation, DARPA and Cisco. While FastSoft didn’t get too much mention in the media, their software did  good job at accelerating web pages and web applications and customers I have spoken with always raved about how well it worked. While FastSoft offered acceleration services for video, applications, software downloads and small objects, most of the revenue didn’t come from accelerating video content, but Akamai has said that’s where they plan to use the technology within their network, at least to start. Terms of the deal were not disclosed, but the price that keeps been talked about in the industry is that it was a sub-$100M acquisition for Akamai. If I remember correctly, FastSoft had raised about $6M in funding. I’ll update this post if I can confirm the acquisition price from a reliable source.

• Allot Communications acquires Oversi Networks: Last month, Allot Communications announced they had acquired another Israel based company, transparent caching provider Oversi Networks for $16M in cash. The company said Oversi will add about $2M a quarter in revenue and it expects the business to reach break-even by the first quarter of 2013. Allot plans to integrate Oversi’s transparent caching technology into their deep packet inspection (DPI) offering. Oversi had raised at least $13M in funding and had been shopping themselves on the market for over a year, so the sale is pretty much a wash for investors. It’s also interesting to note that Cisco was a shareholder in Oversi, yet Cisco didn’t bid on buying the company and recently partnered with transparent caching provider PeerApp instead.

For an updated list of content delivery and transparent caching vendors in the market please visit www.cdnlist.com

I’m pleased to announce that Roku’s CEO Anthony Wood will kick off the second day of the Streaming Media West show (#smwest) with a keynote on Wednesday October 31st. Anthony will demo the latest content offerings available on the Roku platform, show off the newly announced Roku stick and talk about current video consumption habits amongst consumers. In addition, we’re going to be giving away a bunch of Roku devices after Anthony’s keynote.

Attendance to our keynotes are FREE! Just go online, register for an exhibition pass and you’re in, with a chance to win a new Roku device!

The speaker lineup for the Streaming Media West show, (#smwest) taking place October 30-31 in LA, is now complete. We’ve got nearly 100 speakers across 32 sessions with keynotes, workshops, case study presentations, how-to technical presentations and round table panels. A great mix of content owners, broadcasters, consumer electronic manufactures, publishers, content syndicators and technology providers. You can check out the full list of speakers here and I will be highlighting many of the conference sessions over the next few weeks.

Some of the confirmed content owners and consumer device speakers include:

Dijit, makes of the social TV remote app for the iPad, launched a new app last week called NextGuide. Since most people find something to watch by scrolling through their on-screen guide, the new NextGuide app allows you to see what’s on TV, what your friends are watching and what’s available from services like Netflix and iTunes, all in one place. Finding content you want to watch is the key idea, but NextGuide also plans to allow you to record shows on your DVR, directly from their app.

I got to see a demo of the app back in May when it was still being developed and with its release, the company has added additional functionality, more personalization options and a very clean and quick responding UI. The personalization functions are very powerful and allows you to filter choices based on keywords, categories, Facebook likes and the company has a ton of metadata in the backend that makes finding specific content or categories about shows and movies really easy. It also allows you to set alerts to be notified when your show comes on and will let you record shows to your DVR from within the app, if using DirecTV. More support for other MSOs will come in the future.

There are a bunch of TV guide style apps, including those by TV Guide, Fanhattan and Boxfish, but NextGuide has the nicest layout, best UI, is the easiest to use and from what I have seen, the best personalization options to date. You can check out a demo of NextGuide in the video above and download it from the iTunes store here.

I’m happy to announce that the advanced program for the Enterprise Video Conference, taking place in conjunction with our Streaming Media West show October 30-31st in LA is nearly complete. This new two-day conference will focus on video deployments within the enterprise and education verticals and will be co-chaired by seven industry peers.

In addition to round-table panels, we’ll also have stand-alone case studies and how-to presentations. The event will be kicked off with a keynote from American Airlines and additional keynotes will be announced shortly.

If you are interested in being considered for a round-table speaking spot or want to place a customer on a session, please let me know ASAP. There are a limited number of spots available. If you’d rather be considered for a stand-alone presentation, NOW is the time to contact me. In addition to the program you see below, I will be adding three additional round-table sessions on topics to be determined. So if you want to suggest a topic you see missing, (like closed captioning) please do so. If you want to be involved with the program in some capacity, you must reach out to me now to let me know.

TUESDAY OCTOBER 30th, 2012

9:00 a.m. – 9:30 a.m. | Keynote 1: American Airlines
9:30 a.m. – 10:00 a.m. | Keynote 2: TBD

A101 10:30 a.m. – 11:15 a.m.
Panel: Enterprise YouTube vs. Managed Video System
When pitching an online video platform integration to leadership, we often hear someone ask “Why not use YouTube?” Meanwhile, consumer products and services are often more feature-capable than their enterprise counterparts. What are the differences between consumer and enterprise products? Are there cases where a consumer technology can do the job, and what are they?

Moderator: Eric Hards, Manager, Digital Media and Streaming, Enterprise Digital Media, Lockheed Martin

B101 10:30 a.m. – 11:15 a.m.
Panel: Lecture Capture Systems
This session will cover open source products like Matterhorn and ClassX and will focus on strategies in this area for not just capture, but lifecycle management as well.

Moderator: Larry Bouthillier, Director of Digital Video Services, Harvard University

B101 11:30 a.m. – 12:00 p.m.
Presentation 1: Network Architecture for Video and Collaboration
As video becomes pervasive in an organization and more video devices are used, new demands are placed on the network. This session will discuss and train participants on the value and cost savings of taking an architectural approach to an enterprise video strategy including: faster troubleshooting, easier deployment, improved network visibility, predictable quality of experience, optimized user experience, device flexibility, alignment of resources with business priorities, and optimized delivery and performance routing.

Presenter: Aamer Akhter, Technical Marketing Engineer, Cisco Video Collaboration Group

B102 11:30 a.m. – 12:00 p.m.
Presentation 1: Teaching Video Production to Non-Professionals
In this session, you will learn the basics of how to train the non-video-professionals in your organization to create professional-quality and engaging content for your online video property. Topics covered are basic lighting and shot composition, effective interview techniques, tips & tricks for succinct and impactful “talking head with powerpoint” videos, and guidance on hardware and software selection to enable anyone in an organization to create high-quality content on a minimal budget.

Presenter: Bob Donlon, SVP, GM West Coast, WRECKINGBALL Media Group

B101 12:00 p.m. – 12:30 p.m.
Presentation 2: TBD

B102 12:00 p.m. – 12:30 p.m.
Presentation 2: TBD

A103 1:45 p.m. – 2:30 p.m.
Panel: Student-Generated Video on Campus
Students no longer are passive consumers of video. The proliferation of video-shooting smartphones and social media has made them producers. Video is a tool for creative expression, but it is also an excellent tool for evaluating performance and progress, and for sharing ideas, solutions and innovations. In this session we’ll cover ways that student-generated video can be used in education, and methods for effectively and securely managing that video.

Moderator: Paul Riismandel, Director of Curriculum Support, School of Communication, Northwestern University

B103 1:45 p.m. – 2:30 p.m.
Panel: Integrating Streaming, Video Conferencing, and Unified Communications Solutions
Learn how organizations leverage existing video conferencing infrastructure as production studios when integrated with a video streaming system. And learn how video conferencing allows presenters in multiple locations to participate jointly in webcasts. Finally, learn how this is all good news to those implementing streaming solutions because now they can be budgeted as part of a larger video communications budget.

Moderator: George Levar, Video Service Delivery Lead, Accenture

A104 2:45 p.m. – 3:30 p.m.
Panel: Unique Deployment Challenges for mobile video in the Enterprise
Deploying mobile video presents many challenges that are unique to enterprise environments. Enabling the bring-your-own-device trend complicates matters further. This session will address the major considerations for deploying mobile video in the enterprise, including encoding video for mobile devices, choosing the correct servers, and delivering to multiple devices and players, including HTML5. The final challenge discussed is networking, as enterprises need to determine if users are going to access the video over the enterprise Wi-Fi network or the public cellular network.

B104 2:45 p.m. – 3:30 p.m.
Panel: Content Management, Media Management, and Learning Management
Solution strategies for managing information across multiple systems. Strategies for determining which solution is the best fit for your enterprise streaming initiative.

Moderator: Michael Newman, VP/GM, Video Content Management, Polycom

A105 4:00 p.m. – 5:00 p.m.
Enterprise Live Video Production: Tips and Tricks
Description to come.

Moderator: Eric Hards, Manager, Digital Media and Streaming, Enterprise Digital Media, Lockheed Martin

B105 4:00 p.m. – 5:00 p.m.
Panel: The Business Case for Video in the Enterprise
Description to come.

Moderator: Erica Schroeder, Director, Enterprise Video, Cisco

 

WEDNESDAY OCTOBER 31st, 2012

9:00 a.m. – 9:30 a.m. | Keynote 1: TBD
9:30 a.m. – 10:00 a.m. | Keynote 2: TBD

A201 10:30 a.m. – 11:15 a.m.
Panel: TBD

B201 10:30 a.m. – 11:15 a.m.
Panel: Media Asset Management 101
Learn the basics of media asset management and metadata from a panel of content management experts.  We’ll look at best practices for creating, managing and applying metadata to media assets to maximize search and storage capabilities, and strategies for getting started.

Moderator: Patty Perkins, Internal Communications Solutions Team Leader, Wells Fargo

A201 11:30 a.m. – 12:00 p.m.
Presentation 2: TBD

A201 11:30 a.m. – 12:00 p.m.
Presentation 2: TBD

B202 12:00 p.m. – 12:30 p.m.
Presentation 2: TBD

B202 12:00 p.m. – 12:30 p.m.
Presentation 2: TBD

A203 1:45 p.m. – 2:45 p.m.
Developing A Device Strategy
Distinct from a focus on mobility, this panel will analyze device trends, the realities of reacting to new devices, pro-actively targeting certain devices, risks and rewards, and preparing for the future.

Moderator: Michael Newman, VP/GM, Video Content Management, Polycom

B203 1:45 p.m. – 2:45 p.m.
Panel: Creating an Internal CDN to Support Video Deployments

Moderator: Erica Schroeder, Director, Enterprise Video, Cisco

A204 3:15 p.m. –4:15 p.m.
Panel: TBD

B204 3:15 p.m. –4:15 p.m.
Panel: TBD

[Updated: Pricing from 2013 can be found here] At the Content Delivery Summit in May, I presented findings from my recently completed CDN pricing survey, with data collected from over 700 customers that use content delivery networks for the delivery of video. For those who didn’t attend the event, this post will re-cap all of the data I presented and I have also included links to a PDF of my presentation and the video of my presentation from the show. (note: you can always find my latest pricing post at www.cdnpricing.com – Previous Quarters: Q4 11, Q2 11 Q1 10, Q2 10, Q4 09, Q1 09, Q4 08, Q3 08, Q2 08, Q1 08. For a complete list of all the CDNs in the market, see www.cdnlist.com)

The key takeaway from the data is that pricing for video CDN services is very stable and that all of the major CDNs are pricing contracts close to one another. I expect pricing to decline by 15% this year, for the average sized customer. Last year I saw an average decline of about 20%, so the rate of decline this year has been a bit less.

Since I collected data from customers both large and small, I broke down the pricing based on small customers who spend under $100K-$250K per year, medium-sized customers spending $250-500K per year, and large customers who spend more than $1M per year. I also have data from those who spend less than $100K per year and use resellers and regional service providers to stream their video. All of the survey data was collected from March-April 2012 with a total of 725 qualified responses. You can see a list of the questions asked in the survey at the end of this post. Here are the results.

32 customers spending more than $1M per year (all M&E)

• 22 customers using Akamai (multi-vendor), 16 customers using Level 3 (multi-vendor), 12 customers using Limelight (multi-vendor), 1 customer using Amazon (multi-vendor), 2 customers using Akamai exclusive, 1 customer using Level 3 exclusive

• 22 customers have their CDN contract bundled with other non-video CDN services, 10 customers don’t have their CDN contract bundled with other non-video CDN services

• 24 customers have contracts are 12 months in length, 8 customers have contracts that are 18 or 24 months in length

• on average, pricing was down 18.9% this year when compared to last year’s contract

• on average, customers expect traffic to grow 126.6% this year over last year

• on average, a customer doing 3PB a month, is paying a low of $0.01 per GB delivered, high $0.03 per GB delivered

• on average, a customer doing 400Mbps a month is paying a low of $2 per Mbps sustained, high $4 per Mbps sustained

253 customers spending $250-$500K per year (all M&E customers)

• 120 customers use Akamai, 62 customers using Level 3, 32 customers using Limelight, 14 customers using EdgeCast, 8 customers using Highwinds, 17 customers using Limelight and Level 3 (multi-vendor)

• 216 customers don’t have their CDN contract bundled with other non-video CDN services, 37 customers have their CDN contract bundled with other non-video CDN services

• 202 customers have contracts that are 12 months in length, 51 customers have contracts that are 18 or 24 months in length

• on average, pricing was down 11.4% this year when compared to last year’s contract

• on average, customers expect traffic to grow 48.8% this year over last year

• on average, a customer doing 500TB-1PB a month, is paying a low of $0.02 per GB delivered, high $0.06 per GB delivered

• on average, a customer doing 200Mbps a month is paying a low of $6 per Mbps, high $11 per Mbps

123 customers spending $100-$250K per year (all M&E customers)

• 47 customers use Akamai, 18 customers using EdgeCast, 12 customers using Level 3, 8 customers using Limelight, 3 customers using Highwinds, 35 customers using Limelight, Level 3, Amazon, EdgeCast (multi-vendor)

• 63 customers don’t have their CDN contract bundled with other non-video CDN services, 60 customers have their CDN contract bundled with other non-video CDN services

• 81 customers have contracts that are 12 months in length, 42 customers have contracts that are 18 or 24 months in length

• on average, pricing was down 10.6% this year when compared to last year’s contract

• on average, customers expect traffic to grow 73.3% this year over last year

• on average, a customer doing 250TB-500TB a month, is paying a low of $0.04 per GB delivered, high $0.12 per GB delivered ($0.06 per GB average)

• only a handful of customers paying per Mbps delivered, not enough data to provide high and low pricing on per Mbps delivered model

Additional Survey Findings

• 317 customer spend less than $100k per year.

• For customers spending under $100K per year, Amazon dominates with more than half the contracts, followed by EdgeCast, Limelight, Level 3, Highwinds and those who buy CDN services via third-party resellers.

• Across all 725 responses, 6 customers were using AT&T and 7 customers using Verizon (see my post on that here: New CDN Contract Data Shows AT&T and Verizon Not Winning Deals or Disrupting Market)

While I hear many people and vendors talk a lot about connected devices when they speak of the growth of online video, the fact is that in the past 3 years, all of the CDNs have seen a big growth of video traffic on their networks, yet none of them have seen any large jump in revenue from that traffic. There still aren’t enough devices in the market, being used for the consumption of online video, for any CDN to see a big growth in revenue over a short period of time. When that big growth in revenue does happen, many people will say it happened overnight when in reality, it is something that took 4-5 years to really grow. As to what 2013 will hold in terms of pricing declines and traffic growth, it’s too early for me to speculate on that until Q1 of next year.

Survey Questions

1) Which industry vertical does your company best fall under?
2) What is your contract length for video CDN services?
3) If you have a contract for CDN services, when did you last renew it?
4) Is your video CDN contract bundled with other non-video CDN services?
5) How much has your price for video delivery declined versus your previous deal?
6) How much do you expect your total video traffic with CDNs to grow this year versus last year?
7) On a YEARLY basis, how much do you spend with CDNs for the delivery of video?
8) On average, how much video do you deliver per month?
9) On average, how much do you pay per GB delivered OR per Mbps sustained for video delivery?
10) Which CDN vendors do you use for the delivery of video?

I am amazed at what passes for so called “research” these days. This morning, Quixel Research (who?) put out a press release saying that based on a nationwide survey of 1,169 current and potential flat-screen TV owners, Apple’s “highly anticipated Apple connected television platform (iTV) is likely to have a significant and disruptive impact on the consumer electronics and entertainment landscape once it’s introduced.” The reason for their logic? According to their survey, “80% of all current flat-panel TV owners also indicated they would be either extremely, very or somewhat interested in purchasing one of the new Apple televisions.”

Of course what Quixel Research isn’t willing to say is what people are actually willing to pay for an Apple connected TV or how many would be sold. Simply collecting data that shows people are interested in something is completely useless without pricing data. I could survey people all day long asking them if they would like a new car and what features they want it in, but that does not tell me what they would be willing to pay for it and if they would actually spend the money to buy it. Presenting findings without those data points makes all the other results pointless.

In an email exchange with Quixel Research the company did tell me that they had data on pricing, but they are “not able to release specifics on pricing deltas.” Of course they won’t, because that data would show customers are not willing to pay enough for such a device, in any large quantity, (something we saw in this survey) which would make Quixel Research’s data pointless. But that doesn’t stop Quixel Research in their release from making grand statements that such a device from Apple would, “have a dramatic impact on entertainment landscape,” and would, “disrupt the home entertainment industry“. What they classify as “disruption” is anyone’s guess as without even speculating on how many devices Apple could sell or what people would be willing to pay for them, it’s simply lots of buzz words in a press release.

All of this so-called research is simply useless drivel and a ploy by Quixel Research to get their name in the press. Before this release, the company had not been mentioned by anyone in the media since 2009, based on a search in Google News. It seems a week can’t go by without another research firm putting out some sort of broad press release about an all-in-one Apple TV device, simply to try and get their name in the media. Quixel Research won’t be the last company that tries to capitalize on using Apple’s name for their own cause, but it won’t work, we can see right through these ploys.