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VeriSign Selling CDN/Kontiki Service; Question is To Whom

VeriSign (NSDQ: VRSN) announced in November that it planned to shed non-core assets, including communications, billing and commerce, though the fate of its CDN business remained unclear at the time. Now the company is actively shopping its CDN unit, according to The Business of Online Video, and we have also confirmed it form our sources that a deal may come as soon as Q1 of 2008.

The problem, however, is that there’s not an obvious buyer for the unit, which largely consists of its P2P service acquired via Kontiki early last year. P2P CDN services may come to represent a significant force in the industry, but for now it’s an immature area. It may be a bigger video distribution company not in CDN business, but then it would be betting on one specific technology. Yesterday, as reported at sister site paidContent:UK, BSkyB (NYSE: BSY) has abandoned its use of Kontiki’s P2P for its Sky Anytime VOD Platform (Not correct: Sky is still using Kontiki and actually renewed its contract…it has added a browser based service in addition to the P2P service). As TBOV notes, perhaps the most likely outcome is for VeriSign to bundle its CDN service in with its communications services and sell it to some telco looking for a cheap and fast entry into this area.

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