At last week's Content Delivery Summit, I moderated a panel with speakers from Deutsche Telekom, Global Crossing, Level 3 and Tata Communications who discussed how over time, they believe they can dominate the CDN market. (video archives of the panel will be online shortly)

It was a very interesting discussion to hear the telcos talk openly about their offerings today and what they envision them looking like a year from now. Global Crossing, who to date has entered the CDN market by reselling Limelight and EdgeCast, said that 18-24 months from now they will need to stop reselling third party CDNs and bring the product in-house. Deutsche Telekom also agreed that at some point, the CDN offering would become large enough that it makes sense to bring it in-house and have more hands on control with the service.

Level 3 and Tata Communications have taken a different approach and instead of reselling, Level 3 built their own CDN and Tata Communications licensed technology from BitGravity to deploy their own offering. Level 3 said that today, 70% of the traffic on their network is video and building a CDN for them was as much a defensive move as it was an offensive one. Not surprisingly, when I asked all of the CDNs where they think they could slip up, all of them stated that focus and quick reaction to the market would be essential to them being successful within the CDN sector. This should come as a major concern to all the telcos as the one thing they are not known for is reacting quickly to anything. Focus is another concern as well, but I think any company can focus if they really want to. Moving fast, that's a different story and even when some companies try to move fast, they simply don't have the mindset to be successful.

I also asked the speakers if they felt that owning the network offered any kind of cost savings or advantage in the market in regards to being able to sell CDN services at a cheaper cost. While most of them agreed that it did, none of them have yet to be able to prove that to the market since they all have only recently been offering CDN services. While owning the network may give some companies like Level 3 an advantage, until they can show the industry they are making money with CDN and have lower prices, it's pure speculation at this point in time.

While taking questions from the audience, one of the attendees asked the telcos on the panel who resell pureplay CDNs why none of them were reselling Akamai since Akamai is the leader in the space. Deutsche Telekom commented that Akamai "would not move fast enough" and was not "nimble" which is kind of scary when a telco thinks someone else is slow to react. While this is a comment I hear often from customers in regards to Akamai's slowness to respond, I also see a trend taking place. Akamai use to be the number one CDN to go to for resellers and has Verizon, BT and NTT Communications reselling their services today. But in the past eighteen months, AT&T, Deutsche Telekom, Global Crossing, NaviSite, Pacnet, Reliance Globalcom, Tata Communications and TeliaSonera have all decided to resell someone other than Akamai or build the CDN themselves. This can't be a good sign for Akamai and while they do report a large percentage of their revenue each quarter as coming from resellers, we have no idea how much of that revenue is specific to video.

While the telcos were very adamant that they think they can become the major players in the CDN market in 24 months, all of them also spoke with caution and no one was willing to guarantee that they will be disruptive. I think they all realize that they have a lot of work to do to catch up to the pureplay CDNs and the barriers to entry are very high. You can't just roll out a CDN with a bunch of boxes and have true scale, capacity and performance overnight, let alone do a few hundred million a year in revenue.

It's way too early to know what role the telcos will have on the CDN market but at some point, many of them will have to acquire some of the successful CDNs in the industry so they can get to market faster. It's only a matter of when, not if and 18 months from now I think we'll have a very good idea if the telcos can truly disrupt the CDN industry, or will still only account for a small portion of the market share.

While I still think Twitter is one of the biggest wastes of time, starting today, I am going to use Twitter to send out real-time updates about the online video industry. One of the things I realized last week at the Streaming Media East show is that I have a lot of really great conversations with people about topics and trends that never make it onto my blog. Typically there is not enough to write a whole story around or I just don't have enough time to get to it. This is where Twitter comes in.

In addition to providing links to my latest blog posts I will be using Twitter to send out quick news on trends, data, pricing and other relevant topics I hear from others in the industry. I'll also use it to notify people when last minute speaking spots open up at our shows and for when I am looking for quotes for a story I am working on. My Twitter feed is going to be all business and one thing you will not get from me is updates on my favorite sports teams, where I ate dinner or what music I am listening to as quite frankly, I don't think anyone really cares.

Twitter is not going to be a replacement for all the writing I do on my blog, it's simply going to act as a supplement to the blog. So if you'd like hear more about the online video industry in real-time, I look forward to you following me on Twitter.

At last week's Streaming Media East show, we had many of the largest content owners in attendance and I got to spend a little bit of time with many of them hearing more details about their business. One of the many things I learned was that MLB expects to be able to resolve the online blackout restrictions for their MLB.TV service sooner than people may imagine. While no timeline was given, MLB made it clear that they think they can resolve the issue and that there is enough money to go around to pay everyone to make it possible to get in market games through their online video offering, sooner rather then later.

Doing away with blackout restrictions is essential in order for MLBAM to take their business to the next level of growth. Right now, MLB.TV is missing a huge percentage of the market who would not get MLB.TV simply because they don't travel and don't need to follow their team outside of their viewing area. The moment MLBAM can open the service up to anyone who wants to follow their team outside of the TV set, the size of the market that MLB.TV can go after increases dramatically. While some may say that it's about time MLBAM finds a way around this, keep in mind they have been pushing for this for years. It's not as if MLBAM has been blind to the problem and Bob Bowman told me last week that of all calls to the support center for MLB.TV, not surprisingly, blackout restrictions are the number one complaint.

Related Posts:

– MLB's Video Problems Being Overblown By The Media, Here's Why

– MLB's HD Video Using 3MB Stream, H.264, Full 720p At 1280×720

– MLB.TV Launches, $10 Cheaper Than Last Year, HD Video, DVR Functionality

Over the last few months, CDN EdgeCast has shown a lot of success with getting companies like Deutsche Telekom, Global Crossing and NaviSite to resell their delivery network in the U.S. and Europe. Now, EdgeCast is taking that approach to the Latin American market and has signed up Samba Tech to resell their streaming, edge storage, caching, and high-speed delivery services.

Samba Tech is one of the leaders in the South American market and have essentially locked up all the major media groups in Brazil including projects with 3 of 4 largest TV Stations and some of the largest media publishers including SBT, Brazil’s second-largest television station, and Atletico-MG, one of the largest soccer teams in Brazil. Sporting events are a big business down there and EdgeCast has been delivering this content for many months now

What's interesting about delivering content in Latin America is that there is less peering between ISPs in the region than in the U.S. so many times, much of the traffic between countries like Brazil to Argentina first goes back to the U.S. and then back down instead of exchanging over peering in their region. As a result, EdgeCast and most other CDNs can deliver content faster over their networks even if the content is being served from North America than users experience currently in the Latin American market with local content. EdgeCast is serving all of their Latin American traffic today from their POPs in the southern part of North America and said that customers who tested their service against the other big CDNs found it to be just as fast if not faster than CDNs who say they have local POPs in the region.

That said, while EdgeCast does not have any POPs in Latin America yet, they will be building out locally through both direct and indirect relationships over the next 12-18 months as they feel that having local POPs will offer better performance over the long term. EdgeCast is also working with additional partnerships in other regions of Latin America as well.

EdgeCast is really on a roll right now. They continue to sign up a lot of major resellers, have over 300 customers and have only raised $10M to get where they are today. It's only a matter of time before a telco or larger player takes them out of the market and it won't be a fire sale.

With Amazon's content delivery offering now in full swing, Amazon is currently out in the market recruiting account managers and biz dev managers for a dedicated sales force that will focus on selling CloudFront services. Amazon is using the same model for CloudFront as they do for all of their other services, which are mostly self serve, but with additional small, focused teams to work with larger customers who may want more direct interaction with Amazon.

In addition, last week Amazon rolled out "CloudFront Access Logs" which gives customers details on who is consuming their content and Amazon's Elastic MapReduce team has also built a sample application, CloudFront LogAnalyzer that will analyze Amazon CloudFront access logs.

While the functionality of Amazon's delivery services are still pretty bare bones, as soon as Amazon adds streaming capabilities to CloudFront, they will very easily become the de facto standard for those who need very basic video delivery services. While not all content owners will be a fit for CloudFront, Amazon can very easily take over the commoditized portion of the market and it will be difficult for hosting providers to compete with a similar offering, at the same price point. Delivering video is not complex when you're not a major media company and you don't have huge traffic spikes and many video ecosystem pieces. And with the process of sticking a bunch of video clips on a network becoming even easier, Amazon will be in the drivers seat to own the market for small and medium sized content owners who need simple delivery, at a great price.

For Amazon, everything about this business is in their favor. Unlike other CDNs, Amazon does not need to worry about raising money, has many development resources in-house, has a global brand and does not need to rush to get anything out the door by a certain deadline. Amazon has time, money and expertise on their side and in the long run, this is going to be bad news for small regional streaming providers and hosting companies.

It's been a long busy week with the Content Delivery Summit and Streaming Media East shows happening over the past few days. I got to meet a ton of content owners, many from Wall Street and got to spend time with a lot of different vendors in the industry for one on one meetings. We had a record number of 3,733 registered attendees for the East show this year, our highest ever, which is a testament to the growth the online video industry is still experiencing, even with the poor economy. Thanks to everyone who helped make both shows such a success.

I have a lot of posts to work on for next week on things I heard, saw and trends I am seeing take place in the market. There is a ton of content delivery related news and analysis for me to get online as well as my CDN pricing from Q1 which I presented at the show. We'll also have all of the on-demand videos up shortly and most of the presentations are already available for download.

Dozens of articles about the show have already come out and until I get a post up with all the links, Larry Kless has put together a long list of the coverage on his blog here and here. He also has a post with all of the news and releases that came out during the show and archived video of the NY Video meetup that took place with nearly 500 attendees.

I'll be doing a lot of writing over the weekend so look for multiple posts each day next week with my recaps from the shows. I actually have too much to cover and won't get to everything so if there is something you really want me to talk about, drop me a line and let me know.

Our thanks to the 200+ attendees at today's Content Delivery Summit for making the show a great success. We had a really nice mix of content delivery customers, vendors and Wall Street analysts in the crowd with lots of networking and very focused discussions taking place. There is so much to cover from the summit and I'll try to get some posts up as soon as I can. We'll also have the video archives up shortly. In the mean time, you can already find some of the presentations here.

My thanks also to the fourteen vendors who sponsored the event and helped make it a success. If you attended the summit and have any comments on what you saw, heard or would like to see next year, please let me know in the comments section.