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10/17/2000

IDC Forecasts the Content Distribution Services Market Will Approach $1 Billion by 2004

FRAMINGHAM, MA — OCTOBER 17, 2000 — The Internet is getting crowded, and the demand from Web-site owners for accelerated delivery of online operations, such as content, transactions, and applications, to Web users has created a lucrative space for content delivery networks (CDNs). According to IDC, the U.S. content distribution market will increase at a compound annual growth rate of 150%, from $10 million in 1999 to nearly $1 billion in 2004.

 

“The business models of all content delivery networks revolve around exploiting the inefficiencies of the Internet as it now exists,” said Melanie Posey, research manager for IDC’s Business Network Services program. “One way content delivery networks exploit Internet congestion is to reduce content commuting time by pulling content out of centralized datacenters and placing it closer to the end user.”

According to IDC, different types of companies participate in the content delivery space with CDNs, including equipment suppliers, technology developers, Internet backbone operators, and hosting service providers (HSPs). Despite the competition, enough room presently exists for everyone in this space.

“CDNs, HSPs, and backbone network providers will coexist relatively peacefully in the short term,” Posey said. “However, the survival of standalone CDNs in the longer term is another question.”

IDC says the most speculative and inaccurate claim about this new class of service providers is that it will completely displace centralized hosting centers.

“CDNs have neither the interest to become full-blown Web hosters nor the storage capacity,” Posey said.

Information like the above can be found in IDC’s report U.S. Content Distribution/Delivery Services Market Forecast and Analysis, 1999–2004 (IDC #B22873). This report examines the emergence of a new breed of service providers in the Internet space known as content delivery/distribution networks and places them and their offering in the broader context of the Internet services market and the other participating players. This report also includes a revenue forecast through 2004 and profiles a selected cross section of players in the CDN space.

To purchase this report, contact Bruce Atlas at 1-800-343-4952, extension 4053, or at batlas@idc.com.

About IDC

IDC is the foremost global market intelligence and advisory firm helping clients gain insight into technology and ebusiness trends to develop sound business strategies. Using a combination of rigorous primary research, in-depth analysis, and client interaction, IDC forecasts worldwide markets and trends to deliver dependable service and client advice. More than 700 analysts in 43 countries provide global research with local content. IDC's customers comprise the world’s leading IT suppliers, IT organizations, ebusiness companies and the financial community. Additional information can be found at www.idc.com.

IDC is a division of IDG, the world's leading IT media, research and exposition company.

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