Content delivery networks (CDNs) have been around for almost as long as the Internet, but of late they’re on the radar screens of people in multiple industries.
The reason is video. The "content" part of the CDN equation now includes rapidly accelerating quantities of quality-sensitive, premium multimedia. There’s plenty of user-generated content, as well, taxing the upstream. But the bottom line is that the early Internet model of static web sites and basic email traffic is long gone.
Driving this trend are media companies trying to strengthen their direct links with viewers and customers. For their part, leading service providers, including Comcast, Time Warner Cable and Verizon, are in this game, leveraging their own infrastructure, content and programming relationships to deploy "TV Everywhere," the latest buzzword.
In broader terms, however, MSOs have been operating CDNs of their own all along. If defined as an interconnect between library storage and stream, a CDN equates to a video on demand (VOD) network. What is the Comcast Media Center (CMC) if not the hub of a massive CDN? This applies to data, too. Ever since making streaming video a key part of the Comcast.net portal in 2003, for instance, Comcast clearly has had a stake in optimizing links between content storage and streaming over its high-speed data network.
Even more to the point, Project Infinity leverages the so-called Comcast (C) CDN, first to deliver more HD content to television viewers and then (via On Demand Online) to empower customers’ PCs. For its part, Time Warner Cable’s time-shifted television expands upon the notion of a CDN.
That said, the separate class of CDN providers — who in large part are operating the infrastructure for over-the-top (OTT) competition — have valuable insights into the growing need for efficient transport of video.
"We’ve seen what we think is the beginning of an explosion of media on the Internet," said J.D. Sherman, CFO of Akamai Technologies at a Morgan Keegan technology conference in August. Akamai has the largest market share of CDNs estimated at 65 percent in 2009, according to a Goldman Sachs report entitled "Broadband 100," which was released in May 2009.
Definitions and bitrates
Although Sherman said Akamai had moved beyond the "evangelism stage" where it had to constantly explain what a CDN was, he gave a brief definition.
The public Internet is basically 10,000-15,000 networks throughout the world that communicate by business rules they have in place, Sherman said. Akamai overlays its CDN network of 50,000 servers in 1,000 networks in nearly 2,000 locations so end users are interacting with an Akamai server at the edge of the Internet.
"There has not been a lot of expansion of capacity in the middle mile. There’s a bottleneck there." J.D. Sherman, Akamai
Put another way: "It’s a network series of data centers strategically placed in geographic locations," said Andrew Peacock, CDN senior product manager, Global Crossing.
CDNs have earned their bread and butter delivering the digital assets for Websites. But for Akamai, which breaks its business into four verticals, the media and entertainment vertical is the largest segment at about 40 percent of the company’s business.
Although most research finds that people still watch the vast majority of their video the old fashioned way — on TV sets — online video viewing is growing fast.
Web video viewership has almost doubled in two years, according to a report released in July from the Pew Research Center’s Internet & American Life Project, focused specifically on online video. Nearly a fifth of Internet users watch video online almost every day. And the Pew study found that a growing number of recession-conscious Americans claim they are using the Web as a cable TV substitute.
While online video viewership is only a small fraction of total video viewership, it consumes significant amounts of Internet throughput.
"We estimate that a minute spent with streaming video consumes almost 20 times the bandwidth of a minute with a typical Web page without video," stated the Goldman Sachs report. "Today, the average bitrate for standard definition video online is in the range of 500-600 Kbps, which has advanced from about 400 Kbps 18 months ago, or about a 24 percent effective annual growth rate."
The software engineers at Akamai have been doing their math, as well.
Today we see that there are about 400 million people who have watched video on the Internet worldwide, said Sherman. Since most of that video to date has been user-generated, of the YouTube variety, that translates into a 300 Kbps video stream, which is approximately 1 terabit per second (Tbps) of video content on the Web at any given time, he said.
But what if one billion people are capable of watching video online, and what if they replace half of their TV viewing with online viewing at TV-quality streaming of 720p?
"You start to get up to 6 Mbps," said Sherman. "If you do the math on that, you’re talking about 500 Tbps. We see this as a fundamental change in the landscape of the Internet."
The markets seem to support Akamai’s prediction of dramatic growth in video traffic on the Internet.
CDNs are achieving another year of double-digit growth in 2009, writing new contracts at a 23.3 percent pace above 2008, according to an industry report released in August by AccuStream Research entitled, "CDN 2010: Revenue, R&D, CapEx and Operational Analytics."
According to AccuStream, of the 22.5 billion professional video views in 2009, Akamai delivered 31.9 percent; Limelight Networks served 12 percent and Level 3 streamed 11.2 percent.
In February, Global Crossing announced it was entering the CDN market by reselling CDN services from Limelight Networks and EdgeCast Networks.
"We’re combining the advantages of our industry-leading global IP backbone with market-leading CDN services to simplify content delivery through an end-to-end solution," stated Dave Carey, chief marketing officer for Global Crossing, in the February announcement.
"CDNs are essential for mass viewing on PCs," said Andrew Peacock, CDN senior product manager with Global Crossing. "The Obama Inauguration, the Olympics — those have huge flash crowds of popularity that become a proof point and validation for using CDNs."
Adding to the capacity challenge is the fact that the typical online video viewer has no tolerance for delay and will switch to another Website, looking for faster speeds, said Peacock.
Akamai’s Sherman said the delay problem comes from the middle mile — as opposed to the first mile and last mile.
There have been many well-publicized upgrades in the last mile. Comcast is rolling out its DOCSIS 3.0 wideband with download speeds of up to 50 Mbps. The company is aiming for wideband in 80 percent of its footprint by the end of 2009. And then there’s Verizon’s fiber-optic build-out.
"We’ve seen a lot of growth in the capacity of the last mile," Sherman said. "We’ve also seen a lot of growth in that first mile. It used to be a T1 line was pretty good connectivity into your data center. Now you have 10 GigE. The issue is — there has not been a lot of expansion of capacity in the middle mile. There’s a bottleneck there."
Why does that bottleneck exist? Sherman said it’s because of economics. Residential subscribers pay their Internet service providers (ISPs) for last mile connectivity. Businesses and data centers pay telecommunications service providers for the first mile. But nobody’s really paying for the middle mile, so there’s been little incentive to invest.
MSOs, video and vendors
Yet that’s not entirely the case.
As noted above, MSOs such as Comcast have made video an increasingly integral part of their own online portals in recent years. Accordingly, they in effect built internal CDNs — using backbones, regional rings, divisional transport and high-speed data interconnects — to optimize such multi-media traffic.
In a related move, three years ago Comcast spent $80 million to acquire the Platform, an online video publishing company that now helps several other MSOs and programmers to manage online content and powers the backoffice to Comcast’s own TV Everywhere trial.
Content companies also have been expending considerable efforts toward preparing content for multiple platforms. That includes traversing the middle mile. The Disney Interactive Media Group (DIMG) is one example. The U.K. broadcaster ITV is an interesting case of a media company having assumed and then outsourced these expanded video processing responsibilities. (See "Competition," page 34.)
Technology providers likewise are moving into this space. Cisco provided the technology for ITV’s partner Thomson Technicolor. Light Reading also featured results of an extensive test of Cisco’s IP video infrastructure run by the European Advanced Networking Test Center.
In news released during last month’s IBC show in Amsterdam, Cisco announced that the U.K.’s Virgin Media was using its technology to upgrade its IP core and edge network. While this primarily impacts Virgin’s legacy digital television infrastructure, Cisco nonetheless described the deal as a move towards a "medianet."
Cisco’s medianet design, however, is only one answer to the question of how to unify IP video.
Even as content providers have taken on more duties upstream, service providers have exploited the declining costs of IP transport to consolidate more of their own video processing, with Verizon and Comcast both featuring two super headends in their national footprint.
That kind of centralization raises a classic question addressed by CDNs: where to best to serve content?
"If your encoders are on the wrong side of that (middle-mile) bottleneck and your data centers are on the wrong side of that bottleneck, what happens is latency, and performance degradation and cost," said Akamai’s Sherman.
For CDNs, proprietary algorithms help determine optimum storage and routing paths. On MSO side, this discussion morphs into the the larger question of how to migrate into an IPTV solution, incorporating existing VOD networks. Comcast may be further along with its CCDN, but others assert that the right converged CDN architecture will turn on as yet unresolved technical questions of content hierarchies of one, two, three or more tiers, block vs. file transfer and issues involving vendor interpretation.
Already expert at delivering linear broadcast and on-demand video, no stranger to high-speed data and averse to being tagged a ‘dumb pipe,’ MSOs are likely to uphold the value of delivering content through their own networks. In that light, CDNs are competitors, potential if occasional collaborators, and if nothing else, fellow travelers in addressing the challenge of bringing content to the network edge.