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Recent Filings: Aug 1999 (S-1 Filing)
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We provide a global Internet content delivery service that improves Web site speed and reliability and protects against Web site crashes due to demand overloads. Our FreeFlow service, which we sell to Global 2000 and Internet-centric businesses, delivers our customers' Web content through a worldwide server network by locating the content geographically closer to their users. Using software that is based on our proprietary algorithms, we monitor Internet traffic patterns and deliver our customers' content by the most efficient route. Our service is easy to implement and does not require our customers or their Web site visitors to make any hardware or software modifications. Using our FreeFlow service, our customers have been able to more than double the speed at which they deliver content to their users and, in some instances, have been able to improve speeds by ten times or more.
The ability of a Web site to attract users is in part based on the richness of its content. Increasingly, Web site owners want to enhance their content by adding graphics, such as photographs, images and logos, as well as deploying newer technologies, such as video and audio streaming, animation and software downloads. While richer content attracts more visitors, it also places increasing demands on the Web site to deliver the content quickly and reliably. As a result, Web site owners frequently elect to constrain the amount of rich content on their Web sites, thus sacrificing the quality of the user experience to maintain minimally acceptable performance levels.
To use our service, customers identify and tag portions of their Web site content that require significant amounts of bandwidth, such as advertising banners, icons, graphics and software downloads. These tagged items are delivered over our server network. When users request this content, which we call "Akamaized" content, our FreeFlow service routes the request to the server that is best able to deliver the content most quickly based on the geographic proximity, performance and congestion of all available servers on our network.
Our technology originated from research that our founders began developing at the Massachusetts Institute of Technology in 1995. We introduced our FreeFlow service commercially in April 1999. As of July 31, 1999, we had 900 Akamai servers deployed in 15 countries across 25 telecommunications networks, providing our customers with a guaranteed global Internet content delivery service. Our customers, which operate many of the most trafficked Web sites, include Apple Computer, CNN Interactive, Discovery Channel Online, Infoseek, J. Crew.com, The Motley Fool and Yahoo!.
We currently sell our service primarily through a direct sales force. Our plan is to continue to pursue heavily trafficked Web sites through our direct sales force and to penetrate other markets through indirect distribution channels. Currently our sales force is actively targeting primarily domestic companies, focusing on the 300 Web sites that have the greatest number of visitors, Fortune 100 companies and Global 2000 companies with large operations in the United States.
In August 1999 we entered into a strategic alliance with Cisco Systems to enhance and jointly develop new content routing, switching and caching technologies to improve the performance of Web content delivery. Cisco purchased shares of our Series E convertible preferred stock for an aggregate purchase price of approximately $49.0 million in August 1999. For more detailed information about our strategic alliance with Cisco, see "Business -- Strategic Alliances -- Cisco Systems" on page 30.