Just when you thought Akamai
Disney's Steamboat Venture investing arm is plunking down $6 million for a stake in upstart EdgeCast. With a client list involving some of the biggest names in celluloid screening, like IMAX
This won't send market-share leader Akamai spiraling toward an eventual date with doom. Video streaming is a growing market. Anyone who feels that the demand for speedy and secure delivery of chunky Web, video, music, and software content will diminish in the future needs to get his or her crystal ball examined.
The problem with well-financed competition, though, is that it makes this market potentially even more cutthroat.
Things used to be so easy when Akamai could just unhinge its jaws and swallow its threats, like Speedera, Netli, and Nine Systems. Now it faces a cutthroat market where smaller players are capable of doing crazy things. For example, Level 3 slashed prices two months ago, and EdgeCast is offering flexible bandwidth-tethered pricing.
Disney's venture-capital subsidiary is snapping up stakes in several nascent tech outfits, so one shouldn't read too much into a single egg in the incubator. However, Disney expects to serve a lot of digital video and music streams in the future. IMAX is making a big push into migrating to digital projection systems next year. EdgeCast may still be a little wet around the ears, but it's surrounding itself with plenty of prolific role models.
Akamai doesn't need to worry right now, but it certainly can't afford not to pay attention.