Global Crossing quietly starts CDN strategy

Global Crossing has quietly embarked on a content delivery networks (CDN) strategy to resell a diverse set of third-party offerings, according to one analyst.

Global Crossing recently agreed to resell CDN services for EdgeCast as a first step toward reselling services from multiple CDNs that the carrier will ultimately brand as being entirely its own, said David Vorhaus, analyst for Yankee Group.

Vorhaus said Global Crossing gave him permission to publicly disclose its CDN plans, although the carrier has not yet discussed them publicly itself. Global Crossing did not reply to inquiries on the subject made late last week by Telephony.

“Global Crossing’s multi-CDN partner approach is a strong entry as well because it will allow for a diverse array of potential customers to pick and choose what content delivery option is most appropriate for them, dependent on price, availability of services, type of content delivered, etc.,” Vorhaus wrote in a recent report. “Ultimately though, a resale approach must be step one of a more direct strategy.”

Global Crossing’s strategy contrasts with those of Level 3 Communications and AT&T, which both have chosen to offer CDN service directly rather than through partners (Level 3 through acquisition). Verizon Communications is building its own CDN network while it tailors its current IP transit prices for content delivery.

Partnering with carriers is an effective way for smaller CDN players such as EdgeCast, BitGravity and Highwinds to compete against larger rivals, Vorhaus said. But for carriers, white-labeling others’ CDN service cannot be the final step.

“Instead, operators must use this as a starting point and engage in significant internal development to add other elements critical to rich media delivery (encoding/transcoding, content management, storage, [digital rights management], etc.) and tight integration with complementary wholesale service offerings that reside in-house. This level of development and integration cannot happen purely at the sales and marketing level,” Vorhaus added.