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Summary:

Voxel, a New York-based startup, wants to upend the content delivery network business by offering an ultra low-cost service that rides on the back of Amazon’s S3 offering. It’s a move that is sure to further exacerbate the woes of the CDN business, which has already […]

Voxel, a New York-based startup, wants to upend the content delivery network business by offering an ultra low-cost service that rides on the back of Amazon’s S3 offering. It’s a move that is sure to further exacerbate the woes of the CDN business, which has already been wracked by price wars.

Raj Dutt, Voxel’s founder and CEO, has been fighting the odds since the day he started his company back in 1999. His idea of providing Linux-based app hosting was ahead of its time; it’s only recently that the world has started to come around to his way of thinking. Similarly, when everyone was jettisoning their fiber assets, Dutt’s company bulked up on dark fiber, becoming a major fiber and infrastructure owner in New York and New Jersey before expanding to San Jose, Palo Alto and other major Internet hubs. Now he’s betting big on offering low-priced CDN services — and effectively daring others in the space to compete.

“[The] hosting business has become commoditized and [the] same is going to happen to [the] CDN business,” says Dutt. “[What] we are trying to do is pretty much accelerate that.” While CDN providers may blanch, startups should take note, for this VoxCAST CDN could prove to be a money-saver for them. Why? Many of them are using S3 for content delivery and as a CDN replacement. While some would like to sign up for CDN services, they either can’t afford it or they’re turned off by the opaque nature of the CDN business. Most importantly, the CDN operators want to lock users into long-term contracts, something many startups are (understandably) reluctant to do.

Voxel thinks its new VoxCAST CDN is a better option. For S3 customers, such as Facebook app developers, for example, Voxel will pull content from Amazon’s S3, cache it on its edge devices and then serve it up from those devices. Since the company owns data centers and fiber in most major Internet hubs and has interconnection arrangements with many other carriers, it can deliver content cheaply. (See the Voxel web site for details on pricing and comparison with other services.)

Will this antagonize Amazon? Dutt doesn’t think so. “We think S3 is awesome, but it isn’t the best tool to deliver massive amounts of rich media,” he says. Will the idea work? Well it makes lot of sense. And the CDN business could use some transparency. If it does works, however, it won’t be such good news for the current crop of CDN players such as Limelight Networks, Akamai, Internap and Level 3 — not to mention all those startups just jumping into the CDN business.

  1. This seems sort of like a gimmick. At best they’re just providing a migration path from S3 onto their CDN. It’s far from clear that they’re providing much value above and beyond what the allegedly commoditized CDNs are providing.

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  2. @ Jeffrey,

    The big thing about these guys: they are putting their prices on the web and basically daring the others to do the same. I think there is a certain opaqueness in the CDN business, and these guys are playing the price game. The idea is clever enough that it might work, especially for start-ups that don’t have the ability to pay the big CDN suppliers like Akamai.

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  3. I’ve gotta agree with Jeffery. Seems several of the smaller CDN’s already do provide pricing up front. I know CacheFly has done so for years:

    http://cachefly.com/plans.html

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  4. We just did a comparison between Voxel, Cachefly and a few other CDNs:

    http://www.hostdisciple.com/2008/04/26/cdn-speed-test/

    -Ross

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  5. [...] Voxel Takes Aim at CDNs, Amazon S3 Service [...]

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  6. There are so many misconceptions in this article…

    – CDN price war: there is no data to support a “price war”, but if you have some, let’s see it rather than just referencing an article about L3. That story is a red herring anyway. Level3 is among the most expensive bandwidth providers so pricing CDN at the same price as their bandwidth is no bargain.

    – Long term contracts: Sure, CDNs would like to get long-term contracts, but it’s not all or nothing and not everyone signs a long-term contract. Some do because it’s in their interest to do so.

    – Voxel’s pricing is in line with what other CDNs are charging. I don’t see how this is “accelerating” the progression to making CDN a commodity.

    – All Voxel is doing with S3 is using them as an origin. No big technology breakthrough there. This is not a “CDN replacement” if they are still caching in data centers and delivering content from there.

    – Voxel is publishing their pricing, which is nice. However, they call it “no commit” while requiring you to pay up front. In the industry, “no commit” typically means you pay as you go based on your usage, not in advance.

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  7. - Ross your benchmark is quite weak. I don’t believe that Cachefly is faster than Limelight. Firing off a single wget from random server providers does not a benchmark make. I’d be interested in seeing actual benchmarks that test ‘last mile’ connections and do testing throughout the course of a day.

    – Cachefly is kind of a weird CDN in that they don’t origin off a content provider. Instead, you have to upload all your content to them. It’s an interesting solution but not apples to apples, I don’t think.

    – Andy I agree that using Amazon S3 as HTTP origin is nothing special. Not sure what all the fuss is about on that. Any CDN should be able to do this (with the exception of Cachefly)

    – I see they call it ‘No Commit’. It is sort of ‘No Commit’ because it seems they don’t require any sort of contract or monthly quota. It is indeed prepay though. In fairness, it does seem more flexible than even most month to month contracts.

    – Om, it’s definitely refreshing that they publish pricing. More CDNs need to do this.

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  8. Hey Guys,

    Nice to see the discussion, and thanks for the post Om.

    Couple of points of clarification I figured I’d jump in with:

    Mike & Andy, you’re right that any CDN can use plain HTTP origin with Amazon. However, our Amazon S3 integration fully implements their API. This means that our customers can use S3 specific features such as authenticated buckets in conjunction with VoxCAST. I’ll agree it’s not a huge ‘technology breakthrough’, but as far as I know, we are the only CDN to do this.

    Our position is that CDNs in general need to be more transparent with their pricing, and make it easier for customers to do business with them. These days, there are plenty of startups that would benefit from the performance and scalability that a CDN offers. However, the industry is lagging behind, and is very opaque. That’s the main point to take away from what we are doing here.

    Jeffrey, with regards to our ‘S3 Promotion’, I will admit that it rather ‘gimmiky’ ;-) But we’ve got a larger motivation here – to open up a conversation about what the difference between Amazon and a real CDN is. We also want to make it ridiculously easy for S3 users to upgrade to the distributed delivery and performance benefits that a CDN offers.

    Keep the comments coming!

    Best Regards,

    Raj Dutt
    Voxel dot Net Inc.

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  9. [...] Velocix is giving away free CDN services in the hope of getting pubilshers, eh addicted. Om Malik wrote yesterday about Voxel, another start-up that is aiming to take business from Amazon’s S3 [...]

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  10. [...] Amazon was beaten to the CDN punch by New York-based Voxel that started offering CDN services based on Amazon’s S3 [...]

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