|Traded as||NASDAQ: AKAM
S&P 500 Component
Daniel M. Lewin
|Headquarters||8 Cambridge Center
Cambridge, Massachusetts 02142
|Key people||George H. Conrades
(Co-founder, Chief Scientist, CEO)
|Revenue||US$ 1.16 billion (2011)|
|Operating income||US$ 290.65 million (2011)|
|Net income||US$ 200.90 million (2011)|
Akamai Technologies, Inc. // is an Internet content delivery network headquartered in Cambridge, Massachusetts, in the United States. Akamai's network is one of the world's largest distributed-computing platforms, responsible for serving between 15 and 20 percent of all web traffic.
The company operates a network of servers around the world and rents space on these servers to customers, which during the years have included Facebook, Bing, Twitter and healthcare.gov, who want their websites to work faster by distributing content from locations close to the user. When a user navigates to the URL of an Akamai customer, their browser is redirected to one of Akamai’s copies of this website, almost entirely invisible to the vast majority of its users. As of 2009, secure connections (designed to highlight hidden intermediaries) posed a problem to Akamai, and attempts to connect to a popular website over HTTPS might reveal the Akamai backend. More recently, however, enhanced security offerings such as Kona Site Defender have become a major selling point, and in 2013 were the leading driver of revenue growth for the company.
The company was founded in 1998 by Daniel M. Lewin (then a graduate student at MIT) and MIT applied mathematics professor Tom Leighton, together with Jonathan Seelig, Preetish Nijhawan and Randall Kaplan. Lewin was killed aboard American Airlines Flight 11, which crashed in the September 11 attacks of 2001. Leighton currently serves as Akamai's CEO.
Akamai is a Hawaiian word meaning "intelligent" or "witty."
Leighton has served as head of the Algorithms Group at MIT's Laboratory for Computer Science since its inception in 1996. Believing that a solution to Web congestion could be found in applied mathematics and algorithms, Leighton solicited the help of MIT graduate student Danny Lewin and others. Together they developed the mathematical algorithms necessary to handle the dynamic routing of content.
In addition to Dr. Leighton and Mr. Lewin, Jonathan Seelig and Randall Kaplan were also founders of Akamai.
In late 1998 and early 1999, a group of Internet business professionals joined the founding team. Most notably, Paul Sagan, a former president of Time Inc. New Media who founded the Road Runner cable modem service and who also helped launch NY1 News, became chief operating officer and eventually president of Akamai Technologies. George Conrades, former chairman and chief executive officer of BBN Corp. and senior vice president of U.S. operations for IBM, joined as chief executive officer a few months later. The company launched commercial service in April 1999.
Between 2003 and 2009, Akamai’s "revenue grew at a compounded annual growth rate of more than 32%, with a 26% operating margin in 2009. Akamai also broadened its worldwide customer base, with 28% of 2009 revenue coming from outside the United States, up from 23% two years earlier." Part of this growth came from Akamai’s core content delivery service.
In December 2013, Akamai acquired cyber security provider, Prolexic Technologies, for approximately $370 million. The deal helps protect Akamai’s enterprise clients from distributed denial of service (DDoS) attacks, where attackers attempt to flood a company’s servers with traffic.
Content delivery to a user
Akamai provides a service to companies that have content on the Internet (Akamai's customers), to deliver this content to users browsing the Web and downloading content. Akamai does this by transparently mirroring content—sometimes all site content including HTML, CSS, and software downloads, and sometimes just media objects such as audio, graphics, animation, and video—from customer servers. Though the domain name (but not subdomain) remains the same, the IP address points to an Akamai server or to another user's machine that Akamai is used as a server rather than the customer's server. The Akamai server is automatically picked depending on the type of content and the user's network location.
Thus users can receive content from whichever Akamai server or user is close to them or has a good connection, leading to faster download-times and less vulnerability to network congestion or to outages. Furthermore, for streaming media, Akamai claims to provide better scalability by delivering the content over the last-mile from servers close to end-users, avoiding the middle-mile bottleneck of the Internet.
In addition to content caching, Akamai provides services which accelerate dynamic and personalized content, J2EE-compliant applications, and streaming media to the extent that such services frame a localized perspective.
Akamai Technologies owns about 60 other domains, but the primary domains it uses include:
- akamai.com – Akamai's corporate domain
Content-delivery networks and domains
- akamaihd.net, a content-delivery network used by companies like Twitter and Facebook to speed up their services
- akamaitechnologies.com, a content-delivery network used by companies like Adobe
In addition to using Akamai's own servers, Akamai delivers content from other end-users' computers, in a form of peer-to-peer networking When users request a download of some large files served by this system, it prompts them to download and install "Akamai NetSession Interface, a download manager used to reduce download time and to increase quality." However, this software operates not merely as a download manager (delivering content from the Internet to the user's computer) but also as a peer-to-peer server, delivering content cached on the user's computer to other users' computers. The user agreement describes this vaguely as:
- "You agree that the Software may send and receive commands and data related to participating publishers' digital information ("Published Content") to and from the Akamai network and other Akamai NetSession Interfaces to facilitate the downloading of Published Content."
The Akamai web site describes this system as follows:
- "All clients are always on – available to send data when your system is idle. This means there is massive redundancy of peer caches on the network and with such redundancy in resources, the network can be selective about which idle resources to pull from."
The Akamai Network: Edge Platform
The Akamai Network is a distributed cloud computing platform that operates worldwide. It is a network of more than 250,000 servers equipped with proprietary software and deployed in more than 80 countries that relies on applied mathematics, computer networks and complex algorithms to help solve congestion, availability, performance and security problems on the Internet. These servers reside in more than 2000 of the world's networks monitoring the Internet in real time—gathering information about traffic, congestion, and trouble spots. Akamai uses this intelligence to optimize routes and replicate data dynamically to deliver content and applications.
Akamai's approach is to:
- Eliminate long routes by replicating and delivering content and applications from servers close to end users around the world instead of from centralized servers. Akamai calls this delivering from "the edges of the Internet".
- Optimize routes by mapping paths across the Internet to avoid trouble spots, compressing content, and replicating packets.
- Perform computing closer to the user to avoid long Internet latencies (called EdgeComputing).
Akamai's approach requires a comprehensive view of Internet conditions and the tools to control the movement of any type of content or application.
On July 21, 1999, at Macworld Expo New York, Apple and Akamai announced a strategic partnership to build Apple's new media network, QuickTime TV (QTV), based on QuickTime Streaming Server. Both companies later announced that Apple had made a $12.5 million investment in the company the previous month. Apple continues to use Akamai as their primary content delivery network for a wide range of applications including software downloads from Apple's Website, QuickTime movie trailers, and the iTunes Store.
In September 1999, Microsoft and Akamai formed a strategic relationship to incorporate Windows Media technology in Akamai's FreeFlow service, as well as to facilitate the porting of the FreeFlow product to the Windows platform; this relationship exists to this day.
Arabic news network Al-Jazeera was a customer from March 28, 2003, until April 2, 2003, when Akamai decided to end the relationship. The network's English-language managing editor claimed this was due to political pressure.
The official U.S. government White House website (WhiteHouse.gov) uses Akamai Technologies for hosting video clips of President Barack Obama's Web addresses on their own in-house servers, after having posted previous addresses as embedded YouTube clips on the site.
The entire China Central Television website (CCTV.com), including its streaming video, has been hosted on Akamai’s edge servers since late 2009. Hulu uses Akamai for hosting video. MIT OpenCourseWare utilizes Akamai's EdgeSuite for its content delivery network.
Akamai also provided streaming services to ESPN Star (India) during the course of the ICC Cricket World Cup 2011. Other customers include Facebook, Twitter, AMD, Wedubox, Hilton Worldwide Hotels, Adobe Systems, Netflix, Cineville, Miles Kimball, J. C. Penney, Yahoo!, Blizzard Entertainment, QNet Virtual Office, and GitHub.
In March 2005, Akamai signed an agreement to acquire Speedera Networks for 12 million shares of Akamai common stock, valued at $130 million at that time. Both companies also agreed to halt pending lawsuits involving trade secrets and patent infringement. The acquisition was completed in June 2005.
In November 2006, Akamai acquired Nine Systems Corporation for roughly $164 million using "approximately 2.7 million shares of their common stock, approximately $4.5 million in cash and the assumption of options to purchase approximately 400,000 shares of their common stock".
In September 2012, Akamai acquired FastSoft, a Pasadena based company that developed enhanced TCP technology that could complement to Akamai's already existing algorithms.
In December 2012, Akamai acquired Verivue, a technology provider for building Operator CDN.
In November 2013, Akamai acquired Velocius Networks, a provider of quality of service (QoS) technology for optimizing application traffic across enterprise networks.
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- Akamai EdgePlatform
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- Official website
- Traffic Cops Of The Net (BusinessWeek article)
- Akamai: In the Broadband Internet Sweet Spot (article)
- The Motley Fool's analysis of Akamai
- The Akamai Story: From Theory to Practice
- Yahoo! Finance "Akamai Technologies, Inc." Company Profile
- Washington Post profile of the company
- Akamai & The CDN Price Wars
- Globally Distributed Content Delivery