MAD Perspectives Blog

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 Who Wins in the Streaming Game?

Peggy Dau - Thursday, November 06, 2014

With all the discussion and analysis of HBO's streaming announcement, it could be construed that HBO and the consumer are the big winners. But what about the technologies that enable the streaming service? Yes, these technologies are often taken for granted, until there is a mishap. It could be re-buffering of content, or the inability to recognize a user ID, or in-accessibility of content on certain platforms. Behind the scenes there is an army of technology providers addressing concerns for content delivery, content discovery, digital rights, transcoding, subscriber management, billing, ad insertion, graphical user interface and more.

Perhaps the most important component enabling consumer enjoyment of streaming content is the content delivery network. Many consumers assume that their local broadband/internet provider is responsible for enabling the delivery of Netflix type content. This is partly true. Yes, Verizon, Comcast, Charter and others are responsible for the last mile deliver of content into your home. But, that content has traveled many miles from its original source. Content Delivery Networks use a distributed network of servers and software to analyze web traffic and optimize delivery of content across the internet while protecting the content from malicious attacksIt is thanks to technologies from companies like Akamai, Level 3, or Edgecast,  that we are able to enjoy major league baseball games, the Olympics, Netflix or any broadcast or cable network content on our laptops, tablets or mobile devices.

A colleague recently mentioned that Akamai must be printing money with the rise in streaming content. They, and their competitors, are certainly appreciating the rise of OTT services delivering sports, news and entertainment content into consumer homes. Akamai's recent Q3 financial results certainly confirm the demand for their services, with revenue up 26% year over year and overall exceptional financial performance.  In fact, media delivery solutions, were specifically called out in Akamai's Q3 earnings call.

Content Delivery Networks are one of the original cloud solutions as they've been positioning hardware and software assets in remote locations to enable user access to content via the internet. They've been a part of our internet experience since the late 1990's. Long before the term "cloud" entered our every day technology vernacular, CDNs were leasing space in Internet Data Centers to house farms of servers, persistently tweaking algorithms and enhancing content protection solutions. 

While other technologies may not be exceeding market expectations at the same level as Akamai, announcements like HBO's, certainly excite the technology ecosystem enabling streaming content. It also puts incremental pressure on solution providers to simplify content discovery (regardless of platform or distribution channel), enhance digital rights management and streamline user authentication. It's safe to say that winners abound in the ongoing push to stream entertainment, sports and news programs. Just don't assume its only the content owners or consumers!

What's your perspective?