& cplSiteName &

Verizon Scoops Up CDN Provider

Alan Breznick
12/9/2013
50%
50%

Racing to boost its competitive position in the emerging TV Everywhere market, Verizon Communications has struck again, making a deal to acquire another cloud-based video specialist.

Verizon Communications Inc. (NYSE: VZ) announced Monday that it will buy EdgeCast Networks Inc. , a privately owned content delivery network (CDN) provider. One of the fastest growing Internet firms, seven-year-old EdgeCast boasts more than 6,000 customers, including such large North American and European telcos as BT Group plc (NYSE: BT; London: BTA), Deutsche Telekom AG (NYSE: DT), and Telus Corp. (NYSE: TU; Toronto: T).

No terms of the deals were disclosed. But TechCrunch reported Sunday that Verizon will shell out more than $350 million for EdgeCast. Verizon said it expects to close the deal early next year.

The EdgeCast deal comes less than a month after Verizon scooped up uplink for an undisclosed sum. That three-year-old startup, which powers video streaming for the Watch ABC and Watch Disney TV Everywhere apps, focuses on streamlining the uploading and encoding of video streams for TV Everywhere services. (See Verizon Beefs Up TVE Unit.)

As with uplink, Verizon plans to integrate EdgeCast into its cloud-based video services unit, Verizon Digital Media Services . Specifically, the telco said Verizon DMS "will integrate EdgeCast's complementary capabilities to further improve and increase its ability to meet the exponential growth in online digital media content," as well as "broaden its portfolio of site acceleration services for digital enterprises."

EdgeCast, which has raised about $74 million in private funding since its 2006 launch, has made a name for itself in the fiercely contested CDN space despite competing against much bigger, more established companies. Its rivals include Akamai Technologies Inc. (Nasdaq: AKAM), Limelight Networks Inc. (Nasdaq: LLNW), Level 3 Communications Inc. (NYSE: LVLT), and Alcatel-Lucent (NYSE: ALU).

— Alan Breznick, Cable/Video Practice Leader, Light Reading

(9)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
albreznick
50%
50%
albreznick,
User Rank: Blogger
12/10/2013 | 9:26:36 PM
Re: Verizon
So do you think yet another acquisition may be needed for Verizon? Or do they now have what they need to do whatever they're going to do? The plot thickens.
kk-1
50%
50%
kk-1,
User Rank: Light Beer
12/10/2013 | 2:38:24 AM
Re: Verizon
$70M+ in financing means a post-money valuation of probably around $125M to $150M. Which means it's a 2X or so return for the VCs.

That begs the question - why did Edgecast sell for such a low multiple? Obviously, they wanted an exit and a better one didn't show up - which means they were likely not doing too well, and VDMS won't necessarily get lots of new business from this acquisition.
^ip4g^
50%
50%
^ip4g^,
User Rank: Lightning
12/10/2013 | 2:13:55 AM
Re: Verizon
.. the same way BitGravity is with Tata Communications. Do they get really forged, going forward ?
David Dines
50%
50%
David Dines,
User Rank: Blogger
12/9/2013 | 7:13:39 PM
Re: Verizon
Good question Alan, I would not try to guess what, if anything, is the end game for Verizon.  While they have been at this for a while, starting with Velocix, it is hard to know how much they dedicatd to making it happen. I would hypothesize that they tried to make it work first with a homegrown software, then they tried Velocix, then gave up and bought Edgecast.
albreznick
50%
50%
albreznick,
User Rank: Blogger
12/9/2013 | 6:49:26 PM
Re: Verizon
Very interesting indeed. I wonder what Verizon is up to here too. If they were serious about CDNs, why didn't they start earlier and go bigger? Or do they have something else up their sleeves?
David Dines
50%
50%
David Dines,
User Rank: Blogger
12/9/2013 | 3:44:20 PM
Re: Verizon
Very interesting development. I have noticed that the telcos in the past seem to consistently underestimate what it takes to make a global CDN network highly successful.  At least now Verizon will have a knowledgable sales and service staff. I have a wait and see attitude as to whether they will be able to increase market share - if the Terremark acquisition is any indicator, I would not expect great things out of this.
bosco_pcs
50%
50%
bosco_pcs,
User Rank: Light Sabre
12/9/2013 | 3:00:13 PM
Re: Verizon
Dan: 

if memory serves, folks like VZ and T would show their CDN ambition causing some discomfort to folks like AKAM and LVLT from time to time. Then the latter would respond saying they are more than just commoditized CDN providers

I have no clue abot EdgeCast but if VZ's hosting ACA is any guides, perhaps people should wait and see how the regular CDN gang turn out in the next few Qs before they draw any conclusions
wanlord
50%
50%
wanlord,
User Rank: Light Sabre
12/9/2013 | 1:32:31 PM
Re: Verizon
I think it took someone too long and too much money to realize it wasn't worth trying to build it in house...
DOShea
50%
50%
DOShea,
User Rank: Blogger
12/9/2013 | 12:27:25 PM
Verizon
Seems like Verizon is taking a much different direction than AT&T, which has been working closely with Akamai rather than trying to buy up CDNs.
Educational Resources
sponsor supplied content
Educational Resources Archive
Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
NEXT COURSE
Wednesday, September 14, 1:00PM EDT
What Is Agile?
Kent J. McDonald, Product Owner, Agile Alliance
UPCOMING COURSE SCHEDULE
Friday, September 16, 1:00PM EDT
How to Implement Agile
Alan Bateman, Director, Agile Transformation
Wednesday, September 21, 1:00PM EDT
What Is DevOps?
Colin Kincaid, CTO, Service Provider, Cisco
Friday, September 23, 1:00PM EDT
How to Implement DevOps
,
in association with:
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Between the CEOs
CEO Chat: UXP Systems' Gemini Waghmare

8|26|16   |     |   (0) comments


Light Reading CEO Steve Saunders and UXP Systems CEO Gemini Waghmare discuss the strategic importance of digital identity for operators in the midst of transformation.
LRTV Custom TV
F5 Virtual Network Function Integrations With Partner Orchestration Platform

8|24|16   |   6:38   |   (0) comments


F5's Kishore Patnam, product manager for F5's service provider solutions, discusses why service providers are moving towards virtualization and how his clients are utilizing F5's solutions.
Between the CEOs
CEO Chat: Intel's Alexis Black Bjorlin

8|17|16   |   06:23   |   (0) comments


Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Telecom Innovators Video Showcase
Accelerating Telecom Digital Transformation With Nominum DNS

8|1|16   |   12:04   |   (0) comments


Light Reading's Steve Saunders gets an update from Nominum CEO Gary Messiana on how his company is helping carriers on the digital transformation journey.
LRTV Custom TV
Reinventing Operations for a Virtual, Software-Defined World

7|28|16   |   5:23   |   (0) comments


Heavy Reading Senior Analyst Jim Hodges speaks with Accenture's Larry Socher and Matt Anderson about what service providers must do to transform their business to get the benefits of SDN and NFV including: leveraging DevOps, introducing real-time OSS and implementing analytics.
Women in Comms Introduction Videos
Fujitsu Sales Leader Shares Lessons Learned

7|27|16   |   5:12   |   (1) comment


As Fujitsu's only female sales leader, Annie Bogue knows the importance of asking for what you want, being flexible (she's been relocated five times), keeping a meticulous calendar, 'leaning in,' working harder than everyone else around you, being aware and more.
Telecom Innovators Video Showcase
VeEX Test & Measurement Solutions

7|25|16   |   08:57   |   (0) comments


Cyrille Morelle, president and CEO of VeEX Inc., talks test and measurement with Light Reading's Steve Saunders at BCE 2016. This includes innovative products such as VeSion Cloud-Based platform for network monitoring; MTTplus Modular Test platform for Access, Business, Carrier Ethernet, Transport and Core services; and OPX-BOX+ for Fiber Optics.
LRTV Custom TV
VeEX: Live From BCE 2016

7|25|16   |   03:20   |   (0) comments


VeEX's Senior Director of Business Development, Perry Romano, explains how VeEX provides tools to help install, maintain, monitor and manage network infrastructure efficiently and effectively. The portfolio of products on display include the RXT-6000, MTTplus and TX300s.
LRTV Custom TV
Real-Time Telemetry & Analytics for Intelligent SDN Orchestration

7|25|16   |   03:09   |   (0) comments


Packet Design CEO Scott Sherwood discusses how real-time network telemetry and analytics are enabling a new breed of SDN orchestration applications.
From the Founder
The Russo Report: Driving Disruption

7|25|16   |   07:44   |   (2) comments


In the first episode of a four-part series, Light Reading Founder and CEO Steve Saunders and Calix President and CEO Carl Russo drive around town discussing the disruptive mega-changes in the communications industry and where hope lies for service providers to meet the escalating demands of the cloud.
LRTV Custom TV
NetScout: Maximizing Enterprise Cloud for Digital Transformation

7|20|16   |   04:53   |   (0) comments


Light Reading Editor Mitch Wagner talks to NetScout CMO Jim McNiel about maximizing the benefits of enterprise cloud and digital transformation while minimizing potential pitfalls with a proper monitoring and instrumentation strategy.
Women in Comms Introduction Videos
Ciena's VP Offers a Career Crash Course

7|20|16   |   4:14   |   (2) comments


How did Ciena's Vice President of Sales, Angela Finn, carve out her career path? Simple, she tells WiC. She stayed true to her company, customers and principles. She shares her advice for women on how to be authentic and credible, as well as for companies that want to make a real change to their culture and practices.
Upcoming Live Events
September 13-14, 2016, The Curtis Hotel, Denver, CO
November 3, 2016, The Montcalm Marble Arch, London
November 30, 2016, The Westin Times Square, New York City
December 1, 2016, The Westin Times Square, New York, NY
December 6-8, 2016, The Westin Excelsior, Rome
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
Google Fiber Can't Be Called a Failure
Carol Wilson, Editor-at-large, 8/26/2016
FirstNet: A Billion-Dollar Boondoggle?
Dan Jones, Mobile Editor, 8/26/2016
WiCipedia: Should Men Be Included? & Olympians Face Discrimination
Eryn Leavens, Special Features & Copy Editor, 8/26/2016
How the Padres Hit an IoT Home Run
Mitch Wagner, West Coast Bureau Chief, Light Reading, 8/25/2016
Google Fiber Downsizing Not Confirmed
Mari Silbey, Senior Editor, Cable/Video, 8/25/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Light Reading CEO Steve Saunders and UXP Systems CEO Gemini Waghmare discuss the strategic importance of digital identity for operators in the midst of transformation.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Animals with Phones
Live Digital Audio

Bridging the tech skills gap is a major challenge for service providers and suppliers alike today – and the challenge is two-fold when it comes to increasing the number of women in the comms space. Level 3 Communications has made it a priority to overcome both challenges by implementing several unique programs focused on building the right candidates from within – in addition to filling the funnel by supporting STEM and other education programs. During this radio show, you’ll learn about these programs from Mary Beth McGrath, SVP of Global Talent Management at Level 3, and the best ways to bridge your own skills gap so that you are motivated and equipped for change. Plus you’ll have the chance to ask Mary Beth your questions live on the air.