Fourth-generation CDNs and the launch of Conviva

First-generation CDNs use a highly distributed edge model, and include companies like Akamai and Sandpiper Networks (whose acquisiton chain goes Digital Island, Exodus, Savvis, Level 3).

Second-generation CDNs basically try to achieve most of the performance of a first-generation CDN without needing hundreds of POPs, aiming for just a few dozen locations. Speedera (eventually acquired by Akamai) is the best example of a CDN of this type.

Third-generation CDNs follow a megaPOP model — two or three dozen huge points of presence, which they hope will be highly peered. Limelight, VitalStream (acquired by Internap), and the new entrants of the past two years are pretty much all megaPOP CDNs.

Fourth-generation CDNs are very different. They are a shift towards a more software-oriented model, and thus, these companies own limited (or even no) delivery assets themselves. Some of these are not (and will not be) so much CDNs themselves, as platforms that reside in the CDN ecosystem, or CDN enablers. Velocix (for their Metro product) and MediaMelon both reside in the fourth-generation space.

That gets us to the morning’s interesting announcement.

Conviva has come out of stealth mode with a powerhouse customer announcement — NBC Universal. Conviva is not a CDN in the traditional sense, but they’re part of the ecosystem for Internet video. Rather than owning delivery assets themselves, they’ve got a pure-play SaaS solution — a platform that can arbitrage resources from multiple content sources (multiple CDNs, data centers, etc.), as well as offer value-added services like real-time analytics and integration capabilities across those multiple sources. (From an ecosystem perspective, the closest analogue is probably Move Networks.)

What makes Conviva immediately notable is their ability to do real-time monitoring of the performance of every individual delivery, and seamlessly switch sources midway through playing a video, driven by metrics and business rules, thus allowing the customer to deliver consistently good-enough performance (i.e., a target of no buffering or other degradation) at the lowest price point, i.e., cost-arbitraged QoS.

I’ve been writing about the customer desire for control and the rise of the fourth-generation software “CDN” since last year. Conviva takes full advantage of the overlay model. I’d rate the significance of this launch on par with that of Netli’s (back in 2003), although obviously in a very different way.

Because it’s a particularly important launch, I know it’s going to be of substantial interest to Gartner’s Invest clients, and likely of significant interest to our media and telecommunications industry clients. As such, I’m refraining from blogging a detailed description or analysis of the company’s technology and strategy, its likely impact to the rest of the video delivery ecosystem (which goes beyond the CDNs themselves), and the more general impact of the conceptual shift that’s taking place with fourth-generation CDNs. If you have inquiry access, please feel free to use it. A note to clients will be published soon.

(Disclaimer: I was pre-briefed on this, and I am quoted in Conviva’s press release. As I almost always do, I wrote my own quote, rather than letting words be put in my mouth. As with all Gartner quotes in press releases, it is a statement about the market, and no endorsement of the vendor is implied.)

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Posted on March 10, 2009, in Infrastructure and tagged . Bookmark the permalink. 14 Comments.

  1. Hi Lydia, I think it’s an interesting approach, one to keep an eye on, but I would not agree with you that it is a “powerhouse” announcement or a “particularly important launch”. While Conviva has a bunch of companies testing their system in beta, to date, this is the only customer they have announced and even this announcement does not give any details on which NBC online properties will be using the Conviva system. Without any details on what exactly NBC is using this for, in what volume and with what frequency, all this means is a new company in the space has publicly announced their first customer, with no real details. That’s not a big deal.

    I do agree that we are going to see more applications layered on top of the CDNs and as always, the ecosystem will become a lot more important to the CDNs over time. But to date, none of the second or third generation CDNs that you describe above are even profitable, so this fourth generation approach that you describe is interesting, but not a game changer in any regards.

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  2. I have quite a bit more information than is in the public announcement, and I believe that Conviva has the strong potential to be a game-changer.

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  3. Without you talking about what is covered under the NDA with Conviva, which is ok since those are important to adhere to, what is Gartner’s policy on how analysts provide what is essentially an endorsement for a company when Gartner is being paid by that very same company they are endorsing? How do we separate what is a personal opinion versus what is a Gartner opinion?

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  4. Actually, I was briefed by Conviva, so the information I have is not under an NDA. I’m just choosing to not share it in the context of my blog. I’ve responded to press calls, but I intend to write research for paying clients, rather than giving away content away for free. (This is a condition of Gartner’s willingness to allow analysts to blog; our policy is that if we think clients will pay for the information, it shouldn’t be on our blogs.)

    However, about 80% of Gartner revenues come from IT buyer organizations. We’ve got nearly 10,000 client organizations and about 60,000 subscribers. My colleagues and I spend most of our time with end-users, not with vendors, and thus are privy to a lot of information. Among other vertical industry practices, we have a media group, and we also have a program specifically targeted at C-level executives. That’s a roundabout way of saying that our awareness, as a research organization, of what is going on at media companies, from the executive level down to the purchasing guy, is often pretty good.

    On the policy question, here’s a fairly lengthy answer that I hope will be better than “of course we can’t be bought”. I’ll explain why we can’t be bought:

    Gartner never endorses companies, not even in the context of a vendor rating like a Magic Quadrant. We’ll provide facts and analysis, and given how much time we spend with IT buyers, we also spend a lot of time talking through people’s requirements and telling them what vendors we feel would best fit their needs. And we certainly alert our clients to anything that we feel would be of note. Vendors are never allowed to vet our research for opinion; if we’re writing about a specific vendor, they’re allowed to ask for factual corrections, but we do not alter analysis or opinion.

    We’ll provide press quotes to anyone, client or non-client, assuming we’re comfortable with the context of the quotation. The “catch” is that the press quote must be purely factual and about the market, not the vendor. (That’s why my quote in the Conviva press release is about demand for online video, for instance, and does not mention anything about Conviva itself. And it’s why I made it clear in my blog post that even though I’m quoted, it’s not an endorsement.)

    Gartner is careful to ensure that vendor dollars don’t influence analyst opinions. Our opinions can’t be bought — we don’t do commissioned research, commissioned white papers, or any other form of pay-to-play. Unlike nearly all other research firms, the overwhelming majority of our revenues are derived from IT buyers, not vendors. Allowing vendor dollars to influence Gartner opinion would simply not be worth it — IT buyers use us because they trust us to be objective, and our advice would be worthless to them if we allowed it to be influenced by vendor money.

    On a personal level, Gartner imposes on its analysts some of the most stringest requirements (as far as I know, the most stringent requirements) for independence. We can’t have any kind of financial interest in the companies related to those we cover — not only can’t we hold stock in them, but our family members can’t even be employed by such an organization, even if it’s unrelated to our coverage. (Think about that in the context of covering a highly diversified provider like Microsoft or IBM.) We can’t take any sorts of gifts, and vendors can’t even pay for our travel to attend a briefing, or even a meal when meeting up at a conference. In other words, we try to ensure that not only do vendor dollars not influence corporate opinion, but they don’t influence individual analysts, either.

    What we post on our blogs is considered to be personal opinion, not Gartner opinion. However, I can and often do turn what I blog into research positions — once submitted for peer review, they can become Gartner opinions. In this particular case, I believe the Conviva launch to be one with significant implications for the CDN ecosystem, and I intend to write a research note about it in conjunction with one of my colleagues who covers the media industry. In the course of writing that note, we’ll be required to defend the positions we take to our peers, and the published note will be Gartner opinion.

    For more info, see Gartner’s official guiding principles of objectivity and independence.

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  5. Dan, just curious, as I CDN executive for years (company not important), I was curious if you would disclose your fee structure and some of your paying clients. Then, we can go back into your analysis and reports to see if there is ANY correlation between your paying clients and your positive reports. It’s my belief that companies that pay for your events and your time never seem to get any negative reporting from you.

    Just my opinion, but your fee history and client names will clear that right up.

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  6. Hi Ethan, as I have disclosed on my blog many times, none of the CDNs pay me anything:
    http://blog.streamingmedia.com/the_business_of_online_vi/2008/06/investors-i-don.html

    And companies don’t pay me for my time. Unlike many other analysts who will only talk to paying customers, I will talk to anyone, anytime. As you can see, my cell phone number is listed right on the home page of my blog and I answer all calls 24 hours a day, 7 days a week. Anybody can call me anytime, with any questions, free of charge – give it a try, I’m happy to chat with you. Try asking other analysts why you can’t find their phone number on their blog.

    As for your notion that I only write “positive reports” about CDNs that pay me, I don’t get paid by any. At the same time, have you read many of the posts on my blog? I routinely write many things that I feel are not positive.

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