This deal is all about combining Internet optimization and WAN optimization to accelerate enterprise adoption of hybrid cloud networks. Got that?

Let's try to deconstruct this considerable jargon. Cambridge, MA-based Akamai Technologies (Nasdaq: AKAM) and San Francisco-based Riverbed Technology (Nasdaq: RVBD), two big players in IT performance management, are announcing today a unique strategic alliance. The companies are collaborating on a new product -- due out in early 2012 -- that involves Akamai's software running on Riverbed's "Steelhead" networking appliance (for corporate-wide area networks) and Riverbed's software running on Akamai's servers. Financial terms of the partnership weren't disclosed.

The point of the collaboration is to get the right networking software running physically close to cloud providers (like Amazon, Rackspace, Microsoft, or AT&T) all over the world -- and to do it for different data types (text, video, and so forth). The bottom line is Akamai and Riverbed are trying to help customers and corporations run their applications, online and over their corporate networks, in a faster and more seamless way than what's currently available.

"Nobody else can do this now," says Neil Cohen, senior director of product marketing at Akamai.

People often make a distinction between a "public" cloud, like Amazon Web Services (pay-as-you-go data storage and computing power) for startups, and "private" clouds, which use hardware and software from the likes of IBM, Cisco, and VMware to work with data behind a firewall. Yet, in reality, customers may have to use a hybrid system of public and private clouds on a regular basis.

The Akamai-Riverbed partnership suggests just how blurry the line between public and private clouds is becoming. Akamai's software for making data transfer efficient over the Internet, combined with Riverbed's equivalent software for wide area networks inside companies, is intended to help business users access files, run applications, and do whatever else they need to do in a speedy way, regardless of whether their data is on a private network or in a public cloud.

Meanwhile, other cloud-computing tech companies like VMware, Amazon, and Microsoft are creating "enabling technologies, but they don't solve the performance problem," Cohen says. "The end user experience is key."

To that end, Akamai is known for its content delivery networks -- servers and software that route Web content to people's computers swiftly and reliably. But almost 60 percent of Akamai's revenue in its most recent quarter came from what it calls "value-added services," such as advertising decisions and application performance (on top of the content delivery). Today's partnership with Riverbed is further evidence that Akamai is evolving toward a broader model of helping businesses access data and run applications over any cloud network.

"This is different," Cohen says. "We want to get the market thinking about understanding that enterprises now have control over what used to be uncontrolled."


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Gregory T. Huang is Xconomy's National IT Editor and the Editor of Xconomy Boston. You can email him at, call him at 617-252-7323, or follow him at

Microsoft and AT&T are Motley Fool Inside Value picks. Akamai Technologies, Rackspace Hosting, Riverbed Technology, and Vmware are Motley Fool Rule Breakers picks. is a Motley Fool Stock Advisor selection. The Fool has created a bull call spread position on Cisco Systems. Motley Fool Options has recommended a diagonal call position on Microsoft. The Fool owns shares of International Business Machines, and Microsoft. Alpha Newsletter Account, LLC owns shares of Cisco Systems and Microsoft. 

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