This morning, Limelight Networks announced an agreement to acquire privately held EyeWonder in a cash and stock deal valued at $110M. The deal is expected to close sometime in the first half of next year. After DoubleClick and maybe Pointroll, EyeWonder is one of the largest rich-media ad platforms in the space, billing about $35-$40M in revenue for this year. With Limelight’s 2009 projected revenue of $140-$150M this deal should easily make the combined companies into a $200M+ organization in 2010.

For Limelight, this is a smart move and the immediate affect is two fold. It increases their revenue by a third and more importantly, they are acquiring a company that has 70%+ margins on their business. EyeWonder’s overhead is low since they are not in the infrastructure business and this will allow Limelight to diversify their revenue with a product line that’s not competing solely on price, like we have seen in the CDN space for so long.

Already I am hearing some say that the combined EyeWonder and Limelight ad solution will compete with Akamai’s advertising solution, which is not the case. Akamai acquired acerno to get into the behavioral targeting business. EyeWonder is a platform that allows for rich-media ads on the web and within video games. Two very different ad solutions, solving two very different problems for content publishers.

Of the $110M in purchase price for this deal, Limelight is paying for $62M of it in cash. This leaves Limelight with about $100M left in the bank and I would not be surprised if we saw them make a few more smaller acquisitions in the near term.

The drawing is now closed. Thanks to Microsoft I have two copies of Expression Studio 3 to give away. All you have to do is leave one comment on this post telling Microsoft what you'd like to see in the next version of the product. If you are a newbie to the product, no worries, just leave your contact details. Make sure you use your real name and a valid e-mail
address and I'll pick two lucky users at random at the end of the month. Winners: Lon Van W. from Boise, ID and Logan D. from Seattle, WA.

A big
thanks to Microsoft for giving me two copies to give away.

Thanks to many generous vendors, I have a bunch of products I’m giving away this month to readers of my blog. Since I have so many items, I’m leaving the drawing open for all of them until the end of the month. Good luck!

The winner will get one Xbox 360 Pro console, a 12-month Xbox LIVE membership, 1600 points and an Xbox 360 Messenger Kit. Enter here.

To celebrate the launch of Brightcove’s new Express offering, Brightcove has nicely offered to give away 25 Flip Mino cameras to the first 25 readers of my blog who sign up for a Brightcove Express account. Details here.

One lucky reader of my blog will get a copy of Flash Media Interactive Server 3.5. This is an incredible
giveaway as the software retails for $4,500 from Adobe’s website. Enter here.

Last month Roku announced the launch of their new Channel Store and in celebration of the launch, I’m giving away one Roku HD-XR unit. Details here.

Thanks to the Silverlight team, I have two copies of Expression Studio 3 to give away. Each of these retails for $599 from Microsoft’s website and will go to two different winners. Enter here.

This morning, Amazon announced that their CloudFront content delivery service now supports Flash streaming as long as the videos are stored on Amazon's S3 service. Amazon has deployed version 3.5.2 of Adobe's Flash Media Servers in 14 edge locations globally and now supports RTMP, RTMPT (HTTP tunneled), RTMPE (encrypted), and RTMPTE (tunneled and encrypted) flavors of RTMP. In addition, Amazon says they will support live Flash streaming sometime in 2010.

While Amazon's CloudFront service for on-demand video never really disrupted any of the larger CDNs in the market, this latest announcement drastically changes things. While Amazon is not going to take any large customers away from the CDNs, think MLB or Hulu, Amazon does have the potential to take many of the mid-sized customers who spend between $3-5k a month on video. That's Amazon's sweet spot and there are a lot of those customers in the market with the major CDNs. In addition, while Amazon still needs to flush out the other ecosystem pieces for video, their offering already ties in with transcoding solutions from Encoding.com and Bits on the Run. Additional third party developers are already working on other apps that will help enhance Amazon's offering including reporting.

While some might say that the downside to CloudFront is that it does not have an SLA, Amazon does have two levels of premium support that costs between $100-$400 a month for customers who want 27×7 phone support. Right now, I don't see the lack of an SLA for CloudFront as a negative for the customers they are targeting. The trend I am seeing in the market is that content owners want more control over their content, want to be able to do self provisioning and don't want to have to call their CDN every time they need something done. Amazon requires no commitment, no contract, no overages and has up-front pricing with no additional cost for Flash streaming. You can setup a CloudFront account right now and be streaming in about five minutes. What's not to like? If some still want to argue that delivering video on the Internet is not a commodity, Amazon's announcement should make them think again.

Continue reading »

The drawing is now closed. Thanks to Adobe, I have one copy of Flash Media Interactive Server 3.5 to give away to one lucky reader of my blog. This is an incredible giveaway as the software retails for $4,500 from Adobe's website. Winner: Sean D. from New York, NY.

Because I don't want someone winning this and simply re-selling it on eBay, this drawing is only open to companies. To enter the drawing, you must leave one comment on this post with your real first and last name, a valid email address AND the URL of your company. I'll pick a winner at random at the end of the month and mail it out to the user at no charge. Keep an eye on the blog as later in the month, I'll have another Adobe Flash product to giveaway.

A HUGE thanks to Adobe for allowing me to give this away on my blog.

Today, Comcast officially launched their much-hyped TV Everywhere service to customers who subscribe to the company’s broadband Internet service and digital cable TV offering, which appears to be around 10-12M consumers. Comcast is doing a press announcement on the news now so hopefully there will be some more details to come and some more specifics on the numbers.

Users who want to access the content will have to download the Move Networks plugin and the Adobe AIR app. For me, the user experience is not a lot better than what I saw back in October when I got to get hands-on with it when it was still in the trial. While Comcast is rolling out the service nation wide, it’s still being called a “beta” offering and it shows.

The quality of the videos I checked out today took up to ten seconds to buffer, with lots of pixelation and really poor frame rates. I’ll keep checking out the service today but frankly, Comcast is going to have to do a lot better than this quality wise of they want anyone to take it seriously.

When it comes to calculating your content delivery or cloud computing costs, there are a bunch of calculators in the market that let you do this. But very few of these calculators produced by vendors are easy to find online and most are very basic and don't allow much customization.

Last week, Amazon launched an Excel spreadsheet that so far, is the best I have seen in the industry for calculation costs associated with cloud computing. You can read more about it at Amazon's Economics Center website and you can download the Excel file here.