Federal Judge Rya Zobel made no rulings today on any of the multiple motion and counter motions being argued in court by Akamai and Limelight Networks over their patent infringement suit. No ruling is expected until the end of summer.

With all the craziness that is going on in the CDN space now and as competitive as it has gotten, I see a lot of financial sites, blogs and others using a lot of the content from my blog. There are some in the investment community in particular, who try to twist my words around to make my what I say best reflect the company they are invested in. Or they try the tactic of telling others that I work for the CDN I am writing about or own stock in the company, so I must have a vested interest in what I am saying.

So let me say on the record, again, as I have done on the blog in the past that I don’t work for any CDN company, am not getting paid by any CDN company and don’t hold stock in any CDN company. I don’t get compensated based on the share price of any CDN’s stock and I have never bought, sold or traded any stocks, in any public company, ever. (Yes, I know that is hard for some people to believe, but I have never played the market.) So if someone tells you otherwise, it is because they have a vested interest in a certain company and are invested in them. Ask them to state on the record where their interests lie.

While I refer customers to CDN companies based on customers who call into StreamingMedia.com for free, myself and StreamingMedia.com don’t have any referral deal with any CDN company. StreamingMedia.com passes on leads to many different vendors, in many segments of the market free of charge. That’s our job. We don’t get paid to do that and we don’t get a commission.

Over a dozen CDN vendors have been or are current sponsors of the blog since it started, but those are sold by our sales rep. It’s very clear who is a sponsor of my blog at any time. And the fact that so many CDNs are sponsors of the blog, which I thank them for, shows that they feel I am trying to cover the CDN market fairly.

So if any Wall Street folks, or anyone else for that matter, have any questions about who I work for or read something on another site that supposedly came from me, you can call me at anytime to verify. The whole reason I have my cell phone number listed on my blog is so people can reach me at all times. I answer and return every call, every day. It can’t get any simpler than that.

At 10am EST this morning, Federal Judge Rya Zobel started hearing oral arguments for at least ten motions and counter motions pertaining to the Akamai and Limelight Networks patent infringement case. Clearly, the biggest argument at stake today is whether or not the court will issue a ruling in Akamai’s favor, by granting a permanent injunction against Limelight Networks. While many are saying the judge will make no decisions today, there is a chance that some rulings could be made. I will be updating the blog today as soon as I hear either way. With so many motions being heard today and it being an all day affair, I expect we won’t hear anything either way until after 4pm EST.

The most likely outcome is that the judge needs more time after hearing the arguments and pushes back the ruling date by a few months. However, with at least ten motions and counter motions being heard today, there is a good chance that some rulings will come down. Judge Rya Zobel has been working on this case for two years now, and has also been involved in some of the previous Akamai patent infringement cases (including those against Speedera and Cable & Wireless), so there is the potential that she has enough info after hearing the oral arguments today to make a ruling.

While a lot is up in the air today, here are some potential ways this can play out for both sides:

• The judge issues no ruling on the injunction and pushes the ruling date back to Q4 of this year.
• The judge could rule that the Akamai patent is too broad and throw out the jury’s ruling.
• The judge could narrow the scope of Akamai’s patent and could reduce the damages that the jury awarded.
• The judge grants Akamai’s request for an injunction against Limelight Networks as is, or potentially narrows down the scope of the Akamai claim.
• If an injunction is handed down, Limelight could get a stay on the injunction, which pushes Limelight’s appeal process out to 18-24 months from now, or does not grant Limelight the stay, in which case about 50% of Limelights business is at stake.
• If the judge issues an injunction against Limelight, and the stay is not granted, Limelight could also issue a statement saying they have a work-around to the patent and have reduced their company’s liability.

One other potential outcome, which has a good chance of happening, is that the judge rules that some of the motions around the patent are too broad and that the case should go to a higher court. In many patent cases, this happens quite frequently.

Either way, one thing to remember is that Limelight has known about this suit for two years now and I’m sure has not been sitting around doing nothing. Two years is a long time to be able to come up with a work-around and on the last earnings call, Limelight did say that on their Q3 earnings call, they would give shareholders an update on where they stand in regards to their infrastructure. While they did not come right out and say the word "work-around", that is what they plan on giving an update on at the end of the third quarter.

A lot of sites are covering the launch of the new Brightcove platform today, but many seem to be missing a lot of the major new features of the release and instead, are focusing too heavily on an incorrect comparison to Move Networks. Seems to me that many folks are only looking at the press release and didn’t take the time to get a demo of the new features.

Last week I got to see the new platform in action and spent some time asking Jeremy Allaire, Brightcove’s CEO, some questions about their core customers. While Jeremy would not confirm the revenue numbers that I am hearing in the industry for Brightcove, he did say that Brightcove expects to be profitable in 12 months. He also stated that Brightcove has "over 400 premium customers" for their services.

The new Brightcove 3 platform that launched in beta with select customers, has some huge improvements over the previous platform. For starters, player load times have increased from 300-600% in the new platform. One of the biggest gripes I always had about using the Brightcove system is how long it would take the player to load on my website. Looking at some live sites already using the new system, I saw players loading in under 2 seconds. A vast improvement.

In addition, the Brightcove system will now let content owners choose whether they want to encode their content using H.264 or On2’s VP6 for what Brightcove calls "dynamic delivery". Very simply, dynamic delivery allows content owners to upload one video and have it transcoded to multiple bitrates. The result is that viewers get the best quality bitrate sent to them depending on their Internet connection. While some are saying this is a technology Move Networks created or adopted, RealNetworks introduced this technology, branded SureStream, back in 1998. Microsoft quickly followed suit with the same kind of technology branded as Intelligent Streaming in 1999. This idea of delivering the best file to the user, and encoding for multibitrate, is not new, but it is great to see Brightcove leverage it to make the end user experience better. For those who don’t know which to select, H.264 or On2’s VP6, Jeremy said the Brightcove system would make a default choice for them, but didn’t yet know what that default choice would be.

As some have mentioned, the new Brightcove system includes new APIs that enable more customization and more importantly, gives each video in the system their own unique URL. Another complaint of Brightcove users in the past was that the system was not really setup to be able to have search engines easily find the content. With the new system, that problem has been eliminated. The new APIs also allow a lot of customization over the way a video is presented and enables content owners to showcase related videos and drive up the number of videos consumed per viewer. Based on initial beta testers, they are seeing a large jump in the number of videos per user being played thanks to the new options for how the player and the surrounding content is presented. The new system has a drag and drop interface and as a Brightcove user, I can see some tasks that use to take me six or seven steps, now only taking one or two. The new Brightcove 3 system will be free to all premium users, but those who share revenue with Brightcove based on an advertising model, which is a small segment of Brightcove’s business, will have to wait for a newly packaged product offering.

While many are comparing the new Brightcove 3 platform to Move Networks technology, they have almost nothing in common, aside from both companies aiming for high-quality. At no time during my call with Jeremy did he call out Move or even mention them as a competitor. And the new features and functionality that the Brightcove 3 system now has, are relevant to all content owners, not just those with long-from content like some are speculating.

As a company, Brightcove has it’s roots in being a provider to enable content owners to use video for marketing and promotion, as opposed to Move who focuses on the deep needs of broadcasters. Brightcove is not doing anything at the network and infrastructure layer, not doing what Move does with QoS, not providing automation controls and does not getting hands-on with the broadcasters technical infrastructure teams. On the other hand, Move is not out in the market with their own portal or syndication strategy and not going after customers who all need the same publishing system. Brightcove and Move are two very different companies, going after very different customers, who also have very different levels of traffic. Many of Move’s content customers are delivering prime time content, to hundreds of thousands of simultaneous viewers, which is different from content owners using the Brightcove system. One is not better than another, both work well to fill two different demands in the market, but they are very different solutions.

Added: Another difference between Brightcove and Move Networks that I forgot is that Move Networks support live streaming. Something many broadcasters require.

While I expect almost no consolidation in the CDN market anytime soon, in other segments of the industry we’re starting to see quite a lot of consolidation, especially amongst the small ecosystem providers. Three months ago it was Entriq and Dayport hooking up, last month was Onstream Media and Narrowstep and just last week it was announced that JumpTV and NeuLion would merge. Details on the length and complexity of the integration are not yet available and no new company name/brand has been determined.

I expect this is the start of many smaller consolidations we will see in the market over the second half of this year. On paper, many of these mergers make sense, especially since the majority of companies this sized don’t have a lot of revenue and are burning through cash. For JumpTV, they did $8.9 million in revenue for 2007, but their net loss for the year was just over $30 million. NeuLion did $7.8 million in revenue for 2007 and had a net loss of $4 million. If companies of this size can combine services, cut their burn rate and increase their revenue, they have a better chance of being able to stay in the market.

There are easily more than 50 small providers in the market for things like transcoding, Internet TV platforms, webcasting software and the like. While the market is not yet large enough to support so many different vendors and probably won’t be for the new few years, many companies in this space are going to have to look at strategic mergers and acquisitions over the next 8-10 months so they can really start to ramp up their revenue now. For many companies, it is crucial that they put the foundation in place today so that they are a leader in the space years from now when the market really matures.

For Adobe, it may now be time to take On2 Technologies out of the market. With today’s announcement that Bill Joll has resigned as President and CEO of On2 and as a member of their Board of Directors, and the recent problems surrounding falsified revenue at On2, Adobe could swoop in and acquire On2 for a very reasonable price. On2’s stock price is nearing the lowest it’s ever been in almost 5 years and sales for Q1 were only $4.5 million on a loss of almost $5 million for the quarter.

While there is much debate in the industry over On2’s VP7 codec being replaced by H.264, the fact remains that there is no one single codec that will rule the world. VP7 and H.264 both have strengths and weaknesses and both are needed in today’s market. While I have never seen numbers published on how much money Adobe pays On2 to license the VP6 codec, clearly it’s not a lot of money with On2 still having single digit revenue each quarter.

If Adobe could acquire On2 for a reasonable price, it could take On2’s the line of Flix products and offer them to the market for free, or at a much cheaper cost than On2 charges today. Doing this would help accelerate Flash based video adoption and enable Adobe to offer a better live Flash encoder. It’s a safe bet to think that some of the technical resources and development skills at On2, especially in the Hantro division could also be useful to Adobe with regards to their mobile video strategy. And while Adobe is not paying On2 a lot of money for licensing the VP6 codec, acquiring On2 means they would never have to deal with another licensing contract, if Adobe wanted to renew it when it expired. I know many will ask and the answer is, no, I don’t know when it expires.

On2 has some smart technology folks at the company, but their revenue should be more than it is today. They have seen very little revenue growth over the past 12-18 months, all the while the market for online video continues to grow. On2 can’t stay this small forever and like many companies in today’s market, needs to be part of a larger organization to truly grow to the next level. On paper, this is one of those acquisition ideas where it seems to make a lot of sense from both a financial perspective and a product and technology one.

The nice folks over at Roku sent me a set top box a few weeks ago and while I really would like to keep it for myself, I feel it would only be fair to give it away to a reader of my blog. These boxes are currently sold out and back ordered for weeks, so this is your shot to get one now.

UPDATE: Drawing is now closed. Robert Schumann was selected as the winner using a random number picker website.

To qualify to win the unit, all you have to do is leave one comment on this post with a working e-mail address. I will pick one person a week from today using a random number picker website and ship it out to the winner at no cost. (Sorry, U.S. residents only) The unit comes with all of the original materials, box, remote and cables.

Please note that the Roku box does not come with any Netflix service. So you either need to be a Netflix customer, or need to be willing to setup a Netflix account.

Also, Anthony Wood, the Founder and CEO of Roku will be one of our keynote speakers at the Streaming Media West show in September in San Jose. Registration is open and all keynotes are free. Register now for your pass to see Anthony demo and talk about the Roku in person.