Level-3
Bitgravity
Limelight Networks

CDNs Are Big Business, EdgeCast Get $6 Million

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edgecast_logo.pngWhen we watch movies or play music online, there’s a flurry of unseen activity making sure that data arrives when and where it’s supposed to be. This is the job of the high speed fiber and computer systems of the internet’s content distribution networks (CDNs).

Every website that streams content (live video, music) needs a CDN. The flurry of new media online has made it a prime time for companies like Akamai, Limelight Networks, Level 3, VitalStream, BitGravity, and EdgeCast who provide fast and efficient ways to deliver rich media to millions on the internet. The market is estimated to be around $800 million, of which Akamai controls about half.

One of the newer networks, EdgeCast (2006), has closed a $6 million in Series B financing led by Steamboat Ventures, which is affiliated with The Walt Disney Company, bringing their total financing to $10 million. Steamboat joins Series A investors such as Mark Amin, Chairman of CinemaNow as well as Jon Feltheimer, CEO of Lionsgate films. The new funds will be used to expand internationally, scale the network for additional capacity, enhance features, and market to more businesses.

EdgeCast has distinguished itself from other CDNs by charging for bandwidth instead of lumping the cost in with the cost of other CDN services. This means customers should see declines in their bill as bandwidth costs drop.

But these businesses are as much defined by their customer list as pricing plans. Level3 provides the backbone for YouTube’s content. Limelight handles Microsoft and Amazon Unbox. BitGravity serves Revision3. EdgeCast’s most recognizable customer is IMAX, but their investment from Steamboat Ventures leads me to believe they’ll be the CDN of choice for Disney as well.

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