AT&T launches CDN unit, $70 million bet

It may seem like a telegraphed punch to the current players in the content delivery network market, but AT&T has formally launched its CDN business, three different content distribution services and a commitment to invest $70 million this year alone in CDN technology as it seeks to use its own network to provide multimedia CDN services to corporate customers. The carrier first announced its intention to enter the business late last year, and already touted some CDN success at last month's Streaming Media East event in New York City.

The telco giant also appears to be more interested in partnering--at least for now--with supporting players in the CDN ecosystem, rather than acquiring some of the technology it will plug into its CDN services. As part of today's announcement by AT&T, the company said it will be partnering with ExtendMedia, Qumu and Stratacache.

Leading traditional CDN players Akamai and Limelight Networks, as well as a handful of CDN upstarts, may have the most to lose from AT&T's entrance into their sector, but other carriers who earlier staked a claim in the CDN market, namely Level 3 Communications, should also take note. Still, this is a new business play by the granddaddy of all telcos (never mind that your granddaddy wouldn't recognize this AT&T as the one he knew). Does AT&T fully understand what its new adventure entails?

For more:
- see this post at Light Reading's Contentinople
- check out this story at PC World