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Carrier Services
Verizon takes up the CDN gauntlet
Partners with Velocix to turbocharge video and P2P delivery
by Doug Allen
Responding to similar moves from AT&T and Level 3, Verizon Business has announced plans for its own content delivery networking services. The Tier 1 carrier has partnered with UK-based Velocix CDN provider for equipment and services to turbo-charge Web content delivery for a wide variety of IP traffic including burgeoning bandwidth-intensive apps like video and P2P. Specific terms such as duration of the contract and overall value were not disclosed.
The deal calls for the construction of a new overlay CDN for Verizon that will run over the Verizon backbone network, enhancing the existing plant’s capacity. Crucially, this includes boosting the telco’s FiOS fiber network, as well as Verizon’s global backbone, to maximize performance over high-capacity links that are being asked to carry ever-increasing traffic loads, especially in the residential market.
This strategy is a departure from previous provider approaches to CDNs, which either call for building out a whole new CDN as AT&T has done, or purchasing CDN services from wholesalers such as Akamai, Level 3, and Mirror Image Internet.
Like AT&T, Verizon has no intention — at least today — of wholesaling its CDN to other providers, preferring to restrict access to its own customers, and position its capabilities as a competitive differentiator.
Velocix, which started out as a P2P caching provider, then moved to peer-assisted CDN services and hybrid metro CDN services in tandem with ISPs, earned Verizon’s attention on a few scores. First, its technology would support FiOS’s local access infrastructure, instead of acting primarily as a core network technology. Verizon executives emphasized the strategic importance of its FiOS network for its ability to carry high volume traffic, raising revenues for both its higher recurring bandwidth fees as well as the value-added services and content that ride over it. Moreover, the carrier says it sees greater demand, especially from media companies like TV networks, for deeper local network penetration — what some call “deep delivery mechanisms” — in particular regional areas, as opposed to broader but thinner footprints that span the globe.
With this in hand, Verizon can sell more profitable services like video on demand to its subscribers, while assuring media company customers of a direct link as well as a billing relationship to the carrier’s extensive and growing residential and (to a lesser extent) business customer base. Verizon is also targeting various content owners such as movie studios, video rental sites and entertainment services, as well as Velocix’s existing content owner customer base.
Second, the provider is at the forefront of P2P caching, an important feature to reduce network congestion for an increasingly popular bandwidth-hog application among residential users. Velocix is also leading the development charge for emerging P4P technology, which supports network-aware file distribution. Velocix has ties to Verizon through its efforts with the P4P working group, headed by Verizon senior technologist Doug Pasko.
Verizon has also hinted at its desire to use CDN capabilities for a “three-screen strategy, encompassing faster delivery for television and wireless services as well as broadband access. A major competitive advantage could result from optimizing access across the carrier’s entire subscriber base, at least in the residential and SMB market, and allowing customers to access Web content from any device or service platform at the user’s convenience.
The first test of the new alliance will be Verizon customer Starz Entertainment’s Starz Play, a broadband entertainment service for movies and video content, which will be delivered to Verizon broadband customers with expanded options for premium movie viewing. Verizon’s FIOS TV, FiOS Internet and its DSL customer are all eligible for the full roster of Starz media products, including exclusive movies, for an additional US$5.99 a month. Currently, 8.5 million Verizon subscribers are already Starz customers or have access to the service.
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