By Rachel Chalmers
Microsoft Corp has taken a $15m stake in Akamai Technologies Inc, in return for which Akamai has promised to build support for Windows Media Technologies into its FreeFlow content delivery service, a rival to Sandpiper Inc’s Footprint. In doing so Akamai follows the lead of Inktomi Corp, which last week pledged to support Windows Media Technologies in its Traffic Server network cache. Akamai has also undertaken to port its own proprietary software to Windows NT; FreeFlow currently runs only on Linux.
As well as handing over the cash, Microsoft has committed its Streaming Media Division to buying its internet content delivery services from Akamai. Microsoft’s slice of Akamai amounts to about 1% of equity in the Cambridge, Massachusetts-based start- up, giving it a paper valuation of $1.4bn, according to Reuters. That’s not a bad rate of growth for a company that launched in January 1999 with a handful of MIT mathematicians and only $8m in venture funding.
Akamai co-locates 900 caching servers in 25 telecommunications networks. The idea is that end users should only ever have to download internet content from their own service provider. The company’s content-provider customers include Apple, About.com, CNN, Looksmart and Yahoo. Against its red-hot growth rate, however, should be set this alarm bell from the company’s filing with the SEC for an $86m IPO in August 1999: in the quarter ended June 30, a single customer accounted for 75% of Akamai’s revenues, and a second customer for a further 14%.
