Content delivery market set to soar

Industry watchers expect corporate content delivery networks to take off this year as businesses exploit the technology for more than multimedia delivery and Web page caching.

In addition to using CDNs for delivering multimedia content such as e-learning and corporate communications, companies will use them for applications such as transferring sales updates or other data to remote offices and business branches, analysts say.

CDNs rely on Web caching and load-balancing technologies to efficiently deliver large amounts of data over a WAN. CDN technology gained prominence through services offered by companies such as Akamai and Inktomi that aimed to alleviate congestion at popular Web sites.

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Industry watchers expect corporate content delivery networks to take off this year as businesses exploit the technology for more than multimedia delivery and Web page caching.

In addition to using CDNs for delivering multimedia content such as e-learning and corporate communications, companies will use them for applications such as transferring sales updates or other data to remote offices and business branches, analysts say.

CDNs rely on Web caching and load-balancing technologies to efficiently deliver large amounts of data over a WAN. CDN technology gained prominence through services offered by companies such as Akamai and Inktomi that aimed to alleviate congestion at popular Web sites.

But the majority of businesses that use CDN technology have chosen to implement the networks rather than go with a service provider, according to Henry Goldberg, a senior analyst with Instat/MDR.

"The largest traditional application [for CDNs] is the acceleration of Web site delivery, along with streaming audio and video," he says. "But a fair number of enterprises this year will start to use the technology for distributed computing."

Goldberg says that businesses with dispersed offices or branches - such as retail stores and manufacturing firms - are looking to CDNs as a way to move sales information or inventory data between branches and a centralized data center.

According to IDC, U.S. businesses spent about $300 million on CDN equipment, such as caching hardware, in 2002. The firm predicts that this figure will more than double over the next several years, with the U.S. market reaching $1 billion by 2006.

The market for caching and content delivery products has been tumultuous in recent months. Many familiar names in the market have changed focus (such as CacheFlow's transformation into the security company BlueCoat) or have been bought out (such as Yahoo's purchase of Inktomi last week).

Vendors such as Cisco, F5 Networks, Nortel, Radware and Volera still offer CDN products, which include caching devices, Web switches, and appliances for directing and scheduling content distribution throughout a corporation.

SBC Communications uses CDN technology to deliver multimedia training materials to network technicians. Cisco content management equipment is used to issue training videos and other media to more than 300 locations in the service provider's network.

"Most of our [content network] consists of video on demand," says Jim Runnels, a senior network manager who oversees SBC's corporate WAN.He says CDN equipment is an efficient tool for delivering training videos, or corporate informational Webcasts, to branch offices.

Rather than streaming live Webcasts or making online videos available from a central server, the CDN equipment pushes video content to local offices during off-hours. This prevents network bandwidth from being overutilized and provides better quality, because training videos are viewed locally.

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