Video and audio streaming companies have been aggressively marketing their services to Indian customers. According to Media Partner Asia, there are more than 66 million active OTT users across India today, and the number of video subscribers is projected to grow to 105 million by 2020. Exponential increase in use of digital platforms, greater consumption of visual content fueled by a rapid growth in adoption of smartphones and connected devices, CDN (content delivery network) services in the country have never had it better.
Limelight Networks, a leader in content delivery, helps organizations like ISPs, telcos and media houses to build competitive advantage with its private Internet network. It helps its customers to better engage with online audiences, by enabling them to securely manage and globally deliver, digital content, on any device.
Sajid Malhotra, CFO, Limelight Networks, tells BW CIO that the time is just right for CDN service providers to enter the Indian market. He notes that India has the fastest adoption cycles than any other market in the world. However, content service providers will have to get their business models right as India is a price sensitive market.
Q. What kind of content is delivered over your private network?
The delivery of content is growing at a very fast rate. The content that we are best at is large files, which come in three specific flavors. We also do other things such as security, small files performance, and storage – but more than 75 percent of our business is CDN for large file delivery. This includes video, whether it is a live stream or stored video; games for different platforms and software (updates). We have 900 customers and seek customers with delivery for this kind of content.
Q. What is your business model and your USP?
We acquire the content, populate it across our large points of presence (POPs), and we connect those POPs using our private platform -- and then deliver it to the end user using a last mile service provider. We set up relationships with ISPs, wireless and wireline carriers.
If you are in Tokyo, you don’t have to go to Cupertino (California) to pick up a file. You will get it from our Tokyo POP. And if the Tokyo POP does not have the file, we will fetch it from Cupertino and populate all the POPs along the way – using our secure, high speed backbone. We don’t use the public Internet but our own network. We have POPs in roughly 90 metros.
Q. Where do you stand in relation to the competition? How do you compare with Akamai?
Akamai is the largest player in the CDN space and it has a media division that is five times our size. We are number two. Verizon is another primary competitor. They acquired a company called EdgeCast. There are some regional competitors too, like ChinaCache.
Q. How do you see CDN progressing in the Indian market? How do you compare this market with markets elsewhere in the world?
In India, everything that you need is coming together. You’ve always had the consumers and the desire for content. You have the infrastructure (the Internet), the smart phones, content that is being digitised, and price points that have become acceptable. When you have these things the adoption of this business model is much faster. And we are going to target this market heavily. We are building our infrastructure here and already have points of presence in Mumbai, Chennai, Delhi. These are connected to POPs around the world with a high-speed backbone.
India is a late entrant in some of these areas so the adoption curves here are much smaller. In some places it may take 5 – 6 years from inception to adoption. Over here it takes two years. The other unique aspect of the Indian market is the price points at which they conduct business is really low, the lowest in the world. This is a challenge for us. I do not need labour, my business is not labour intensive. I need infrastructure (servers) and real estate, bandwidth, power -- which are all expensive here. But consumer subscriber rates are low here, so it is difficult for service providers. There’s the cost of content acquisition, content delivery, help desk, advertising, marketing and other costs. The cost of content is low here.
We just provide the infrastructure to the service providers.
Q. What is your dependence on, and relationship with the telcos?
I need to buy the interconnects between my sites. I also need to buy the connections to my international sites. Thirdly, I need to connect to the telco networks or the Internet service providers to get the content out (to consumers). The content can be accessed over wired and wireless networks. So we connect with the ISPs, the wireless carriers and with the phone companies.
Q. Who are your key customers in India?
We partner with streaming services, gaming and media companies. Amazon is a customer. The software companies that make software for consumers, the app stores, the music libraries – all use our networks. Netflix isn’t our customer as they have their own network.
No CDN company in the world has enough capacity to handle all the traffic all the time. So many of the providers participate, especially when there is an international event, such as the Olympics or a world tournament, that is broadcast worldwide. - BW