Verizon’s Purchase of CDN Provider EdgeCast Says Content is Still Royalty
Like many big companies it can appear a little clumsy and out of touch at times but it is important to watch the moves it makes because it gives insight into the thinking around the direction f the online space.
Verizon is primarily known as a network provider and among the leading (if not THE leading) wireless carrier.
As a marketing pro are you asking “So what?” yet? You should and here’s why. Verizon is set to purchase CDN (content delivery network) provider EdgeCast Networks for $350 million and marketers should take note. For years content has been pushed to the edge of networks to facilitate faster and smoother delivery (which in turn simply means better end user experience which is something all marketers should desire) and Verizon has decided that it should be in this game itself rather than depending on third parties.
Verizon is looking to get deeper into the content delivery business with the acquisition of Los Angeles-based CDN provider EdgeCast Networks, TechCrunch has heard. Owning EdgeCast, and combining it with the carrier’s global network backbone COMMA, will give Verizon access to EdgeCast’s big-name CDN clients while also extending its reach.
According to a source, the deal for EdgeCast — which provides CDN services to the likes of Twitter, Pinterest, and Hulu — is expected to be announced in the coming days, and will be worth more than $350 million. Both EdgeCast and Verizon declined to comment on the matter.
While Verizon has seen success in its wireless practice, growth in the company’s enterprise business has lagged. With the enterprise division expected to remain flat over the next year, adding EdgeCast to the mix could add a profitable new revenue stream.
The implications for marketers should be obvious. By consolidating network services and the other ancillary services that are needed on top of the network to make content delivery better, Verizon is telling everyone that content is still royalty and is the main reason why any of us have jobs.
As the definition of online content expands, it will be critical to align with technology providers that have the same vision. that vision should include making the end user experience the best one possible. As the sheer amount of content continues to explode, savvy content creators, providers and deliverers are going to need every edge over the competition they can get and companies like Verizon that provide the best services on top of their network stand to gain.
If nothing else, companies like Verizon, who are engaged in the dreaded ‘race to zero’ on bandwidth costs, need additional revenue options to help them grow moving forward. Also, as more and more content is being delivered over mobile devices, network providers will need to be at the top of their game so that they can viewed as valued partners who help marketers reach this valuable segment smoothly and cleanly.
As a marketer how important is it to ‘partner’ with tech providers? If more people use Verizon wireless for their connectivity would it make sense to talk to them about their EddgeCast service (when it is integrated etc etc) and gain delivery advantage to a specific group of mobile users?