Jonathan Seelig, vice president of strategy and corporate development of Akamai, speaks at SEYBOLD San Francisco 2000 on the topic VISIONS OF THE FUTURE:
JONATHAN SEELIG: Thanks. Thank you.
What I'd like to talk to you guys about a little bit is some of the ideas of what can be done today using distributed infrastructure, using some of the new infrastructure trends that exist on the Internet.
I want to talk about the elements of the Internet that content providers no longer need to worry about. So what this principle of distributed infrastructure and of content and application delivery means to content providers. And then I want to talk about a few of the new technologies that emerge from this distributed infrastructure that Web publishers and content providers in the world can take advantage of. And some of the new trends that we're seeing and the new things that people are doing using distributed infrastructure, because some of them are pretty amazing and I'll go into a few high level examples of what people are doing on distributed platforms.
The Internet looks like a very simple structure. The idea is that you have content on a Web server somewhere. You connect that to this big thing called the Internet, you have users who also have connections to this big thing called the Internet, and everybody is happy and everybody gets what they need through this big mesh in the middle.
It turns out that it's really not a simple structure at all; that the Internet itself is a very messy, very complicated, very tumultuous sort of place. And the idea is that -- or the reality is that the Internet is comprised of networks of networks, and you'll see each backbone, each network provider in and of itself has its own infrastructure to run. Those networks need to connect through network access points, peering points, private exchange points, public exchange points. There's a lot of complexity in how this is structured.
What this means is for content providers to get their content from that Web server that we see on the left side of this screen to that end user who we see on the right side of the screen is really a nontrivial exercise. And Akamai came into being and we started our company and our infrastructure business based on the idea that we had a new solution, an innovative solution, a distributed solution that helped people do this better.
Centralization doesn't work for the delivery of rich and robust content. Content providers have a worldwide audience. There are 300 million people who can come and see their content. And it's a big infrastructure problem.
This is an interesting illustration. You sort of see how far you need to go to a whole bunch of places around the world if you've got your Web server centralized somewhere on the east coast of the United States.
When I was in college, I had a physics professor who said you should never do arithmetic in public, but I'm going to disobey his wise teaching and try it anyhow.
Let's look at just a real simple example here. Let's look at what it takes to reach an audience the size of, say, The Cooking Channel, a small cable channel, 100,000 viewers. It's about one-tenth of a Nielsen rating point for people who compute audience size that way.
What do I need to do to get to 100,000 subscribers for Web video content? High-quality video, 300 kilobits per second, so people on a cablemodem or DSL connection or high-speed connection in their office can see high-quality video. 300 kilobits per second on 100,000 users gives me long haul capacity that I need of about 30 gigabits her second. In the overall long haul capacity of the Internet, you'd suck up about 20% of it for The Cooking Channel.
This is an example of how hard it is to take that centralized server we saw in the previous slide and get something with the popularity of The Cooking Channel to Web servers on a cablemodem connection in the UK. It's very, very hard to do because of the massive infrastructure that you need.
Once you move into this model of edge delivery and getting things from the edge of the network to end users, you really open up the capacity of the network. You no longer are constrained by the bottleneck at the core of the Internet. You're no longer constrained by those network access points that we saw in one of the previous slides, but the interconnects of the networks. You're now opening up the line speed that you have from the edge of the network to the end user.
And in this kind of model where you see local servers serving local users, you open up the capacity such that serving something like The Cooking Channel is no longer a challenge, and no longer becomes a problem.
What do you get when you deliver content from the edge of the network? You get fast performance. You get reliable performance of your Web site, and you get scalability of your Web site. Those things are all tremendously important for Web businesses that are really looking to scale.
So that's sort of a quick summary of what content delivery means and what it means to distribute content from the edge.
Let's talk about the new trends that this distributed infrastructure gives you. Not only does that distributed infrastructure give you the performance, speed, the reliability and the scalability for your Web site, those are things that content delivery and distributed systems do at their core by design, let's talk about some of the new things that are being enabled. And that's really what this talk is about, is about some of the new things that we're able to enable using this distributed infrastructure.
This distributed infrastructure gives us the ability for very robust analysis and reporting for Web sites. It gives us an amazing ability for content customization, and it gives us the opportunity to do something that both of the previous speakers addressed a little bit, which is to protect, through digital rights management, valuable digital assets that content publishers and owners care about.
So let's take a quick look at those three things.
Analysis and reporting. One of the most important things that you need to be able to do when you have a Web site is analyze its effectiveness. Distributed systems, content delivery networks, have really changed the way that you can look at a Web site. You can now look alt a Web site in terms of what it's doing regionally for each audience that is trying to access it.
So what you see here in this image on the screen is a set of reports that a content provider can generate that tell this content provider a lot about where people are accessing a site: Who in the world is interested in this content. And you folks in the audience know very well from your experience working with content owners that this kind of data is the kind of data that opens up all kinds of new thinking and all kinds of new business opportunities for the content provider customers. And again, distributed systems have given us a really powerful set of tools to generate this kind of reporting and to generate this kind of information for those content owners.
So reporting and analysis is very, very important. Let's take a quick little example. Streaming media Web casts. Let's look at the kind of data that people are interested in when they look at streaming media Web casts. And we carried, for example, about a month ago now, Steve Jobs' keynote address from Mac World where we had 96,000 viewers in total come in and watch this Web cast. We had 21,000 simultaneous viewers on this Web cast. We had 5,000 people watching a one megabit per second stream, which is just sensational quality.
And what are the kinds of pieces of information, nuggets that the content providers want to pull out of this type of Web cast activity? Let's just take the Web cast as an example.
People want to know the total number of streams delivered. It was very important that we could go back to Apple and say 96,000 people watched this. They want to know the number of unique users. Again, that 96,000 number. They want to know the number of simultaneous users. In the case of that Apple keynote again, the 21,000 number. The number of requests for different player types, encoding speeds, they want to know how many people hit the Web site concurrent with the Web cast to learn about a set of products or services. They want the ability to capture responses to survey questions. You want to be able to ask your audience things during a live Web cast. And you want to know where the referring URLs are. Who referred people to your event. All of those things are what the next generation of content providers and cutting edge content providers today really care about.
This is turning into an ROI business. People want to know there is a return on their investment in putting streaming media up on the Internet. And the only way to demonstrate that this investment is generating returns is to have powerful reporting tools that gives these content providers the information that they really care about.
So there's our first example of some of the new things that are happening because of distributed infrastructure.
Traffic analysis is clearly very, very important, for viewing of historical logs, for realtime analysis. So we've shown one example of the new infrastructure providing new services in the form of traffic analysis and reporting that people really care about.
Let's look at the second example. Content customization. What happens when I know that I am serving a Japanese user from a Web server in Japan as opposed to just seeing this person as a generic Web user and serving them out of my hosting facility in Virginia or in Santa Clara? When I have this knowledge, I can localize content in an amazing way. I can localize the advertising. I can localize the language in which I serve content. I can localize the sponsorship opportunities. I can sell local sponsorship opportunities on a Web cast to the local businesses that care about hitting that local audience.
So how do you take this global medium in a global Web cast or global Web site and localize a lot of the pieces of it?
Now, this idea of distributed infrastructure, of content delivery devices at the edge of the network say I know that you as a user are connecting to a device close to you. That device close to you can contain all kinds of localized content. Really amazing and powerful tools to give Web publishers, again, better ROI.
Some very compelling content that we've seen content providers create. Localizing content so that you see relevant content for your local community. We see, for example, music sites who are putting up a different form of streaming media or a different piece of content of streaming media depending on where that comes in. We're also seeing content providers start to go create through these distributed systems, through content delivery networks, bandwidth aware content.
So this is an example of a Web site bringing you a broadband feed, a high-quality video feed, because they know that you're a broadband user.
This is really quite an amazing trend. Imagine seeing this same Web site from your dial-up connection when you're sitting in your hotel room in San Francisco as a narrowband Web site and when you're on your cablemodem at home seeing it as a broadband Web site. No difference in what you do, no difference in your device; only a difference in your connection speed. Again, customization and personalization that's occurring through distributed systems.
Other examples of content customization. We see people like Style365.com, Name Zero, CNN using geographic targeting. Some more examples of content providers out there using geographic targeting to increasing ROI.
So that's our second example, is the example of customization.
Let's talk about the third new trend that we've seen through our distributed infrastructure and through the content delivery business for new things that people are looking to do on the infrastructure.
This is digital rights management. The idea of digital rights management, and the two speakers before me addressed this briefly, is to be able to deliver, to protect, and then to monetize and to collect for digital assets that you own. And we're seeing tremendous interest from people like eBook publishers, from people like the movie studios and people who have valuable film, audio, and video content that they want to get out on the Internet as well as people with Web content that they want to syndicate. You saw a very compelling example of syndication in Norm's Web design example that he used Dream Weaver for.
An example of this, Entertainer. Entertainer.com, a company that is providing video on demand services to subscribers; in particular, DSL enabled regions. So if you are a DSL subscriber in the Cincinnati Bell territory, you can subscribe to the Entertainer service, run films on demand, run first-run films like Message in a Bottle, The Matrix for you to stream through a broadband connection to your home.
How were Entertainer able to secure the rights to these very valuable film assets? By proving to the studios that they had digital rights management solutions that were robust enough, powerful enough and secure enough to get the movie studios comfortable with this idea that yes, it's okay to put this content online. I know that I will be able to protect it, deliver it, and monetize this content in this online environment. And Entertainer had an amazing model. They will sell you the right to view a film with full stop, rewind, pause, all the playback functionality you would want. They sell you that ability for a 24-hour period so you will be able to see Message in a Bottle for a 24-hour period on your PC, on an IP-enabled set box top that connects to your television set. But they managed to put in place all that DRM solution that enabled the content provider to be comfortable enough to allow this to exist.
It's giving people the basis for incremental revenue, ability to license and syndicate content in the ways you saw in the previous keynote talks. It's giving people an ability to really do some interesting customer data mining and interesting data analysis on what people are really buying and what people are willing to pay for in terms of content on the Internet.
Another DRM example. When the I Love You virus struck, McAfee had a huge crush of users who needed to be able to download the newest versions of the Mac a fee antivirus software. This happened in May. The I Love You virus struck. We supported 4.6 million hits to the McAfee Web site and delivered over 500,000 copies of the software on the first day. And again, this was done in a secure, in a -- and in a monetizable way for McAfee. So McAfee people coming in the door would own the software for use on their desktop and that they had a license for the software to use on their desktop.
So again, the ability to distribute digital goods in a secure, protectable and monetizable way.
So in summary, global content delivery and this idea of distributed infrastructure cannot only help to optimize Web site performance, but is also starting to allow for incredible rich new functionality for Web sites. And we went through just three examples here. The ideas of reporting, the ideas of customization of content, and the ideas of digital rights management and the protection and security of digital assets.
Thank you very much. Hopefully we have a little time left for Q & A.
(Applause.).
JONATHAN SEELIG: We see a very interesting cross-section of the content provider base at Akamai with a couple of thousand Web sites who use our service to deliver. I've been very, very impressed with the level of awareness and of responsibility that we see from the Web sites where our customers, about how they think about using information about their end users. And for the most part, we see a very, very responsible content provider community out there.
There are, of course, the rogue operators who are going to do some of these things, but I think for the most part we've seen a very positive trend.
We use information in the customization examples that I gave about very broad and general characteristics. So, for example, what country a user is in.
CRAIG CLINE: Right.
JONATHAN SEELIG: What the connection speed that that user has, looks like in terms of an infrastructure piped to the Internet. But we're very aware of not actually looking at an individual user as an individual user but as an Internet connection.
CRAIG CLINE: Do you do any policing of the sites that you -- the customers you service and advise them if you think that they are crossing the line in terms of violating any of this privacy?
JONATHAN SEELIG: We don't. We have a -- we see ourselves as an infrastructure company that is a pipe to the network. And our customers provide the type of content that they want with the type of personalization and the type of applications that they think are relevant for their business on the back end.
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