Commoditized CDN offerings sprout

Amazon.com became the newest entrant in the fast-growing (CDN) sector this week, launching what at least one analyst is calling the market’s most commoditized offering to date and signaling a larger trend toward more simplified CDN offerings bundled with other services.

“Amazon’s offering, when released, will be the most commoditized, bare-bones service you can think of for content delivery,” said Dan Rayburn, executive vice president of StreamingMedia.com, a publication covering online video technology. “It won’t support live broadcasting…[or] a live Flash event. It won’t support authentication of video. It won’t provide any reporting or analytics specifically around video. It’s not going to provide a lot of the functionality that the major CDNs have today specific for video.”

The entry of more commoditized offerings into the market doesn’t diminish the need for more sophisticated offerings, Rayburn said. It simply focuses CDN on a different group of potential customers.

“[Amazon’s] offering will appeal to the thousands of content owners out there with very simple, basic content delivery needs who only care about price and don’t need transcoding, steaming, live authentication, reporting analytics…and all the other stuff the major CDNs are offering,” he said. “The idea that suddenly NBC is going to go to [Amazon] for CDN – it’s not going to happen.”

In addition to the reduced functionality, he said, the number of points of presence Amazon brings its CDN service to are likely to pale in comparison to the reach of CDN leaders Akamai Technologies or Limelight Networks. And while competitors in general may be able to undercut Akamai’s prices, they haven’t dethroned it in the market, which indicates the importance of function over price in the CDN space, Rayburn said.