Concerns over local Limelight CDN pricing

Rudolph Muller

Rudolph Muller is the editor at MyBroadband and covers telecoms and broadband news. Rudolph comes from an academic background, but left the University of...

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Business Connexion (BCX) is establishing a Limelight Networks’ content delivery network (CDN) in their Midrand data centre, and is offering local service providers access to this valuable resource.

Limelight Networks’ content delivery network (CDN) brings rich media delivery, game and software downloads and general web content closer to users through establishing nodes throughout the world.

This service is similar to the well known Akamai CDN which currently has nodes at Internet Solutions and Telkom.  It is understood that a CDN operator like Akamai or Level 3 will typically provide the node for free, but the bandwidth costs associated with hosting the node are covered by the service provider hosting the node.

The addition of a Limelight Networks CDN node in South Africa is a welcome addition to the other local CDN services like Akamai and Google Global Cache, but the benefits of this service are at risk of being undone by the cost associated with accessing the content.

According to two independent sources the price of bandwidth to gain access to the BCX Limelight Networks node is close to the price of international access, essentially removing the value proposition of having a node in South Africa. 

One source called the BCX CDN pricing ‘crazy’, adding that he does not think any ISP in their right mind will sign an agreement with Business Connexion in the current format.

Another concern from some Internet Service Providers (ISPs) is that the Limelight Networks CDN node is hosted in BCX’s Midrand data centre which makes access to this node cumbersome. 

According to one industry expert BCX does not have a strong peering presence at JINX and CINX, adding that BCX typically charges companies to provide network services into their data centre.

MyBroadband has received information that some of the country’s largest ISPs have declined BCX’s offer to access the Limelight Networks CDN node, citing the high bandwidth cost as the main reason.

According to one source BCX most likely looked at the hosting of the Limelight Networks’ CDN node as a business opportunity to make more money out of bandwidth sales than what they will have to fork out in bandwidth costs to host the node. 

An alternative theory was tabled by another source as to why the pricing is so high, saying that a business partnership between Limelight Networks and BCX which tries to capitalize on the high bandwidth prices in SA may be at the heart of the problem.

Business Connexion responds

Business Connexion executive Victor Antezana explains that BCX and Limelight intend to bring true net neutrality to the market by offering to peer with all players on level terms – something it says Limelight could not achieve by allying with one of the established ISPs.

“Business Connexion has given them [Limelight] a Switzerland option.  By placing the content here consumers will get tangibly better results making this move a rising tide that will float all boats,” said Antezana.

Antezana said that Limelight Networks has reached agreement that BCX will have exclusive rights to resell it’s technology in Sub Saharan Africa.  “Limelight is providing the PoP as a black box which is operated as part of it’s global out of it’s Network Operations Centre in Tempe Arizona.”

Limelight has built it’s business on a settlement free peering basis, and Antezana explains that new local content will be made available on a settlement free basis:  “New, local content – i.e. that which is generated by South African content owners – will be made available to our peering partners in SA on a settlement free basis. We anticipate that this will be in the region of 2Gbps by the end of 2011.”

Antezana further explains that it is not BCX’s intention to profit from this venture.  “Local ISP’s already pay significant sums of money to access content from our international customers, often duplicating the same content from multiple peering points and across multiple backhaul routes for delivery on their individual networks.”

“We will make this content available on a paid basis but at a rate which is significantly less than they pay now, we pull it down once and distribute to the many. Our intention is not to profit from this activity but to pass on our costs and in turn save the peering partner,” said Antezana.

Antezana also downplays the rumoured rejections from some ISPs, saying that BCX has only met “with a couple of local ISPs for initial discussions and we have yet to outline the economics”.

Further encouraging news is that BCX is planning to initially make peering available in JINX and CINX, with plans to add other internet exchanges as and when they come up.

Antezana said that they anticipate a launch date of October 2010 for the Limelight Networks CDN service.

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