Verizon announced they are launching their own content delivery network (CDN) to “distribute content that Verizon contracts for directly with content owners like movie studios, TV networks, video rental sites and entertainment services…” The CDN is being phased in through a business relationship with Velocix, a U.K.-based digital asset-delivery network provider. Velocix will provide CDN services utilizing p2p technology to Verizon. “Verizon is now positioned to offer content owners and video distributors a competitive choice in delivering their services to our broadband customers,” said Marjorie Hsu, Verizon vice president for network technology. “With our new delivery capability, content owners will be drawn to our networks, and our customers will be the beneficiaries of a broad range of compelling content services.”
Verizon joins an increasingly crowded CDN landscape. CDN’s are growing as broadband and high capacity network owners aim to leverage their core networks for the growing business of content delivery to a plethora of network connected devices. By creating their own CDN capability, Verizon and others eliminate the need of contracting with other transport networks to distribute content, thus hopefully increasing margins. Companies like Verizon may be attractive to content owners, because in addition to robust CDNs, they also offer millions of existing broadband customer relationships. The first example of this Verizon collaboration is Starz Entertainment’s Starz Play broadband entertainment service, which “provides unlimited online subscription access to more than 2,500 movies and video selections on demand, in addition to a live stream of the Starz premium pay TV movie channel.” It’s yet another example of broadband service providers trying to leverage core strengths for competitive advantage.