Just three weeks after it announced that it had acquired the television cloud company UpLynk, Verizon Communications announced its intention to buy EdgeCast, a leading content delivery network.
Los Angeles-based EdgeCast, founded in 2006 by Alex Kazerani, Phil Goldsmith and James Segil, provides high-capacity servers that form the pipelines between content creators and end-users, including entertainment and media as well as commercial data for companies like Mercedes-Benz, LinkedIn, Sony Entertainment, Twitter, Yahoo! and others.
New York City-based Verizon said it wants EdgeCast to increase its ability to meet surging demand for online digital media content and broaden its portfolio of site acceleration services for digital enterprises at a time when entertainment viewing is shifting from TV sets to less conventional platforms.
Customers Want Quality
“The combination of EdgeCast and Verizon Digital Media Services will allow us to fully exploit and accelerate growth in Internet media consumption and online business performance,” said Bob Toohey, president of Verizon Digital Media Services in a statement.
“EdgeCast’s industry-leading technology and strategically placed assets, combined with Verizon Digital Media Services’ video solutions, improves our ability to deliver the rich, reliable and quality digital media services that our customers have come to expect.”
The deal has been approved by the boards of directors of both companies and is expected to be finalized early next year. The cost of the deal was not announced by the companies but a published report in TechCrunch, citing anonymous sources, said the price was more than $350 million. The UpLynk deal was cited at more than $75 million.
"Having journeyed from startup to technology leader in a short seven years, the time is right for EdgeCast to elevate itself again by joining Verizon to continue our innovation and growth,” said Alex Kazerani, EdgeCast chairman and chief executive officer in the Verizon statement.
Step By Step
Verizon says its digital Media Services offer enterprises a suite of robust and flexible end-to-end video solutions for best-in-class TV Everywhere and superior over-the-top experiences.
"This step will allow Verizon to move ahead more quickly and satisfy more customers with more innovative services," said Jeff Kagan, an industry analyst. "On its own, this step might not sound like a big deal, but this is one of many steps that Verizon is taking In this direction."
The previous deal with UpLynk, which streams on-demand video to numerous devices using a single adaptive format to reduce costs and complexity for broadcasters and content owners, is intended to "complement Verizon Digital Media Services’ broad-based end-to-end solutions," the company said.
“As the experience of watching broadcast television changes and the media marketplace shifts, the addition of UpLynk’s unique capabilities allows Verizon Digital Media Services to better meet our customers where and how they want to deliver video,” said Toohey.