Cidera sets sights beyond caching

Network World, 02/21/00

Doug Humphrey, CEO at Cidera, is busy taking the company beyond the caching services that inspired the firm's original name, SkyCache. Cidera provides satellite-based content distribution offerings. Humphrey recently spoke with Network World Senior Editor Denise Pappalardo about the 'Net, the competition and a big boat.

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Why the name change?

We were SkyCache and we love that name. We kind of like the word "sky," but the word "cache" gets us pigeon-holed as, "Oh, you're a caching company." So all sales, marketing, public relations and everybody else basically spent the first 10 minutes of any meeting trying to unpigeon-hole us. As much as we like the name [SkyCache], and we really do like the name, it became detrimental. Cidera is based on the Latin word for star or sky.

Why are content distribution services so hot now?

New requirements are getting heaped on top of the existing Internet because everybody expects the Internet to suddenly become the one communications network. The architecture of the Internet is driven by what you're asking the network to do. And everybody thought the architecture of the Internet was pretty much set, a done deal. Everybody said it's going to be all of this OC-x, OC-192 or OC-768. The industry thinks it has solved the problem with more bandwidth and the game is over, and we think the game's really maybe in the second inning.

What kind of new Internet requirements are you referring to?

Different types of content, such as broadcast content, are coming over the Internet. Think about CNN or Bloomberg sending live videostreams over the Internet. This is broadcast. CNN's Web page, you might not think it looks like a broadcast site. You might think it's between you and CNN, but when 10,000 people per minute hit [CNN's site], it's starting to look a lot like a broadcast.

Competition is heating up in the content distribution market. Who are Cidera's main competitors?

What we're doing is a little different from what most people are doing. We haul data to the edges of the network. These [other] guys find content providers, they encode content and they consult on the design of the content. They put servers out to the edges. Fundamentally, these guys are all about providing a full service soup-to-nuts to the content provider. We're not. For example, companies such as Akamai and Adero also need broadcast transport services. They move a lot of stuff point to point and they use, let's say UUNET, for that. UUNET doesn't compete with us because if you try to use UUNET for broadcast to 1,000 different edge locations, there's no way it's going to be very economical, and there's no way it's going to work really well.

How many points-of-presence do you have?

We have dishes at about 250 POPs. Those are at our customers' and ISPs' POPs. They're paying to have our dishes at the edge.

Is Cidera guaranteeing service levels?

We have [service-level agreements]. We haven't [formally] announced them.

Are you planning to make a formal announcement?

Yeah. I will say this. Satellite delivery is orders of magnitude better in terms of reliability and minimum packet loss than terrestrial networks. It's not just twice as good, but 50 times as good in terms of the packets lost. Satellite tends to be extra reliable because - this is going to sound funny - but because it's tremendously error prone. Which means that in order to use it, the technology has very powerful error correction built into it. This is why to an Internet user, satellite content distribution just looks perfect.

How did starting SkyCache in 1996 compare to starting up Digex, the ISP you formed in 1992?

In 1992, no one knew what the Internet was. We were leaving flyers under car windshield wipers trying to say, "There's this thing called the Internet, and you should get on the cattle ride." With SkyCache, of course, it was much easier - one, because I now have a track record, and two, now everybody knows what the Internet is.

What are some of your interests outside of the office?

Outside the office - what's that look like? You don't have a lot of hobbies when you're into starting up companies. I did just buy a really big boat [an old British warship]. So once it arrives, I'll just spend some time on my boat to try to relax.

Extended interview

What's holding back multicasting technology?

Multicast is not enabled right now because there are no settlements on the Internet, which is a very, very, very sticky issue. Right now everybody says, "You can enable multicast." Technically, you could but here's the issue: There's no one company that owns the Internet. It's all these hundreds of companies that all peer with each other. Multicast allows one provider to effectively overwhelm another provider. Nobody would care as long as you overwhelm my network, then you write me a check.

Settlements between multiple ISPs have been talked about for several years, but there haven't been any significant developments. Why?

It's easy to talk about settlements, but it's not easy to actually go accomplish settlements. It's like campaign finance reform. Is there any politician who would not look at you and say there's no need for campaign finance reform? No, no one's gonna say that, but guess what? No one's making any motions to change campaign finance reform because the reality is it's hard. There are a thousand hyper-painful steps needed to take to get to that goal, and none of these people are willing to take the steps.

Your analogy is saying that political parties need to make sacrifices as do ISPs in order to agree on how to set up settlements. Well, on the ISPs, let me just put it to you this way. What if we just said, "OK, we gotta go to settlements. Oh, and by the way, because of the way settlements are going to work, the smallest ISPs, which make up 20% of the market, aren't going to be able to peer on the 'Net." That's what we'd be looking at right now. And no one has the authority to do that and it would cause too much pain in the market.

So where does that leave the ISPs on settlements?

Everyone's going to talk about it, just like campaign finance reform, but no one's going to do it.

What are the challenges in coming up with a name for an Internet company these days?

First you got to find a name that isn't taken. Then you have to find domain names that aren't taken, or that you could negotiate to purchase, because, of course, everybody is registering everything. And, finally, you have to make a philosophical decision: Should the name reflect what the company does or not?

What do you mean by that? Under normal circumstances, you want the name to reflect what you do because that way when people hear the name they immediately get what your company is about. Like when people hear a company name like SkyCache, they get a clear idea of what you do. Whereas when people hear a company called fogdog.com people typically say, "fogdog, what the hell is that?" Dogs in a fog? No, it's sporting equipment. The name isn't associated with what the company does. So, the philosophical question is: Should the name match up with what you do or not? The funny thing is we just got burned, if you will, buy a name that does match up, right.

You're referring to Cidera's former name SkyCache?

In the Internet world, companies evolve quickly and that's not a bad thing. So names need to be a little more general because you don't want to have the same problem happen again. Cidera is based on the Latin word for star or sky.

How is Cidera's overlay satellite content distribution network different than terrestrial content distribution networks?

Let me give you an example. In our system customers buy 45M bit/sec of throughput, but they are actually getting 60M bit/sec. There is a huge difference between 45 and 60M bit/sec and it all has to do with error correction. There is huge error correction built in to satellite services making the services wildly reliable. Terrestrial Internet providers actually have to send three copies of data just to make sure they get one copy correct. So it's a big deal for them.

Why do they have to send three copies of the data?

Because of errors and packet loss and the Internet. See if you use the public Internet to move your data around you have to be prepared to deal with massive packet loss and that's very expensive. With satellite, packet loss is minimal.

In the past both AT&T and UUNET have said that they're "looking at satellite" as a service delivery option for their customers.

Yeah. Everybody, I think all the big guys are evaluating things like this but it just takes a long time for them to role things out.

The larger the company the slower they move.

Boy, is that the truth.

What does the competitive landscape look like for Cidera?

My feeling is what we are doing is the future of the satellite industry and more satellite companies will start offering similar services.

Right now, which satellite companies are you buying wholesale capacity from?

GE, but there are a lot of other companies out there to buy capacity from.

Do you expect that you will sell directly to business users in the future?

Yeah, we expect enterprise customers, meaning large companies, will use our streaming video services. Also they will use our big file mover service in the future.