I will be wrapping up the CDN segment today with a look at LimeLight Networks. Limelight’s technology is similar to other CDN’s available on the market. A bit too similar, as they just lost a big patent violation case filed by Akamai. Shares are down since the announcement, and things are looking grim in Arizona. So why are we even talking about them?
Customers: LimeLight has Microsoft, one of the largest clients in the Content Distribution game. The XBOX 360 is a media sponge with a loyal, content craved fan base. When you serve up the largest online market for console games in the US, it means something. So the fact that they just signed last year Sony, the soon to be second largest online console market, gives this company some serious clout. Enough to say that either on their own or though a buy-out, LimeLight will be around in the future.
Their Services: Much like any other CDN, LimeLight offers its customers Content Delivery. This is no different than CacheFly’s service, maybe better situated and built out, but the same offering. Unlike other CDNs, LimeLight also supports a proper Streaming Service for its customers (see previous CacheFly post for reference). It follows up its service with an a-la-carte offering of options in its Custom Service. Here you can dedicate servers and control specific option. These are much needed options in the CDN market. Other players in the market have horizontal offerings that go way beyond what most B2Bs needs for their content. LimeLight is playing in your space.
Having said all that, these are the issues and why I think you are still okay with LimeLight.
The Patent Dispute: According to a PC World article, the patent violation deals with Global Hosting system only and not the CDN portion of their business. The Massachusetts U.S. District Court has ruled that LimeLight did not violate Akamai’s CDN patents, as was originally claimed in the suit, only the global hosting. Long of the short of it is, they have a valid CDN business. Going in with eyes open.
Liquidity: Choosing a CDN parter doesn’t mean you are picking out china patterns together. Content is fluid, easily redirected. Using LimeLight now does not preclude you from moving to someone else in the near future. They use one-year contracts, but those become null in the event of an injunction anyway, so as long as they can meet the terms of the SLA (Service Level Agreement) you have little to worry about.
Personal Take: Litigation aside, this company hits a sweet spot right now. My personal experience with LimeLight is limited, but I have heard good things about their customer service from friends in the biz who use them. Their price points are not published, lending to a more traditional model of molding offerings and prices to individual customers. Numbers that I have seen put simple FLV HTTP progressive downloads under one and a half dollars a Gig. Your mileage may vary. In my opinion that number is competitive. The judgment of $45 million against them is concerning, though an appeal is possible. This company has a $100 million yearly revenue stream and enough major players to continue to run their business. Short on an injunction against what they do today on the CDA side, I think they should be considered a player in the B2B space.