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Akamai CEO sees opportunity in economic downturn

By , IDG News Service
March 09, 2009 01:39 AM ET

IDG News Service - With many companies cutting headcount and costs to weather the economic downturn, Akamai Technologies President and CEO Paul Sagan wants his sales team to spend more time with customers, part of a bid to make sure that its content delivery and edge-hosting services don't end up on the list of expenses they consider cutting. At the same time, he said the recession will push some companies, particularly those in the retail space, to accelerate their shift to the Internet.

Slideshow: What tech industry CEOs are saying about the economy

Sagan sat down with IDG News Service during a recent visit to Singapore to talk about how Akamai is dealing with the recession and the impact it's having on demand for Internet content and services. He also offered his thoughts on U.S. plans to expand broadband Internet access and network neutrality. What follows is an edited transcript of that conversation:

What is Akamai doing to get through the current downturn?

We just came off our global sales kickoff, and we spent a lot of on training and reminding people that it's not just about prospecting for new business, which we're going to do as aggressively as ever. We have a huge emphasis on customer satisfaction and going back and listening to customers. In this region, for example, they've upped the expectation for how often we're going to touch the customer and talk to them, and understand that it's not just every three years or ten years on renewal of the contract. We want to talk to them every quarter or every month and understand what's going on in their business, what's their pain point and can we help with it.

There are a few things you do in a downturn and one of them is listen to your customers and the other is overcommunicate. We're trying and hopefully we'll see results.

Do you think the broadband stimulus package in the U.S. will generate much growth in demand for broadband services and content?

I think it's a good thing to do, but if you look at the roughly $7 billion, it's really targeted towards rural broadband adoption, so just the number of people who will be impacted is relatively small. It's not going to help the majority of the population who still can't get a super high-speed connection in urban areas. But I think the administration was correctly concerned that if at least some level of broadband is available in most urban areas -- and high-speed is available at work -- when you get to the rural areas, in small towns there's often no broadband available, at work or at home. They're trying to incent operators to essentially stretch the cable a lot farther, and obviously bear a higher cost for a potentially lower return.

In some ways, it mirrors the old-world phone system. It falls short of requiring universal access for broadband, but it really incents providers to try to build out in rural areas. I think there's an assumption that they'll do things like tie hospitals to the network, even in rural areas. So the question is, if they do that could you incent them to make it available to the community somehow? In the overall stimulus package, it's a relatively small piece.

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