Trender Research™

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Are Content Delivery Networks (CDNs) a Competitor to Traditional TV and Video Service Providers?

I ask this question mostly due to the fact that the major CDNs are for the most part the engine that drives home video content to PCs or other devices, whether it is event-based, live or archived, and streamed especially versus downloaded-to-own. They are especially behind the scenes of live events that are broadcasted over the Internet, and heretofore were the primary means for delivering short-form video (YouTube). In recent years their technology has developed to the point of the ability to deliver millions of video streams that can handle long-form content – or movies as we know them. Some of the prominent video content delivery networks out there (Akamai, Limelight Networks, Move Networks and others) are delivering as many as 20 million or more simultaneous high-resolution (1080p) video streams to a very large Internet-to-PC audience. Add to this a mix of content aggregation, solid media players that come in the form of a competing set-top box, and one’s ability to home network video content to multiple screens and you’ve got a viable threat to all traditional pay-TV operators. The delivery of TV episodes over the Internet by the major networks is being powered by CDNs, so what’s to stop this trend and why not major studio movie releases – and earlier windows of opportunity (speculative on the part of Trender Research) that rivals release windows to Blockbuster, Netflix and the Hospitality sector?

This question was asked of some fellow colleagues of mine, and the responses were similar for the most part. I will share this much, that many in the IPTV and CDN industries recognize and acknowledge the threat to pay-TV operators (Cable, Telephone and Satellite), but expect to see partnerships and hybrid offerings that will overshadow any real independent CDN operator (and content aggregator) threats. But, there is a growing disenchanted group paying premium subscription prices for TV service (Cable and Satellite especially) that have or are threatening to cut the cord if they can get 80% or so of the primary programming of interest to them on-demand via CDN-backed services. Any Trenders out there meeting this profile?

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