DT Taps Edgecast for CDN Initiative

Written by Ryan Lawler

Monday, January 26. 2009 at 02:00 PM EST 4 comments

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European carrier Deutsche Telekom AG (NYSE: DT) is getting into the content delivery business through a reseller agreement with EdgeCast Networks Inc. , the companies announced today.

Through the partnership, Deutsche Telekom's international wholesale services division, ICSS, will sell CDN services using EdgeCast's technology and global network. Under the Global Content Delivery Solution (CDS) brand, ICSS will offer a range of content delivery services, such as content acceleration and and on-demand streaming.

Through the deal, DT joins a number of global ISPs that have recently announced their entry into the CDN business, most of which have done so through partnership with smaller players.

Last November, Verizon Communications Inc. (NYSE: VZ) teamed up with Velocix to begin offering CDN services over its network. Earlier in the year, Tata Communications Ltd. (NYSE: TCL) announced a partnership to deploy BitGravity Inc. 's CDN technology throughout its network, a deal that possibly prompted Reliance Communications Ltd. to roll out its own CDN services with help from Internap Network Services Corp. (Nasdaq: INAP).

Andres Jordan, vice president of innovation for Deutsche Telekom ICSS, says the decision to get into the CDN business came about after a value assessment of where the carrier's future growth would come from. And the decision to team up with EdgeCast came about after a due diligence process that looked at three possible CDN partners.

Ultimately, the biggest deciding factor was EdgeCast's reporting capabilities, which Jordan called "best-in-class." Also key was EdgeCast's billing and provisioning system, which makes it easy for DT to set up multiple client accounts and sub-accounts as needed.

"People want these reporting capabilities, which we think nobody else has. Companies want to understand deeply where their traffic is going," Jordan says.

For EdgeCast, the deal is a major validation of its partner strategy, according to company president James Segil. He says that about 25 percent of EdgeCast's revenues come through reseller relationships, and he expects that amount to grow due to the DT partnership.

Segil notes that when EdgeCast entered the market, it was looking at a two-pronged approach of building a strong individual brand while also pursing reseller opportunities with ISP partners.

"Before we entered the marketplace, we saw that a lot of the telcos were sitting on sidelines looking in," Segil says. "For them, this is a way to get into the CDN market quickly."

Despite the fact that DT has a global presence, the CDN services it sells will be running on EdgeCast's network, according to Segil. The startup CDN has 16 global points or presence (PoPs), with four PoPs in Europe. That includes two PoPs in London, one in Frankfurt, and one in Amsterdam.

Related links:

• EdgeCast & Michael Moore
• Verizon, Velocix Team on CDN Express Lane
• Tata & BitGravity Link Up