Microsoft Invests $15 Million in Akamai Technologies

Cambridge, Massachusetts-based Akamai Technologies, a cutting-edge Internet content delivery service, announced Monday that Microsoft Corp. has made a $15 million (US$) investment in the company and will integrate its software into Akamai’s expanding network.

According to the two companies, the goal of the strategic relationship is to help further the rapid growth of the digital media market. Akamai — which means cool, clever and intelligent in Hawaiian — will incorporate Windows technology into its FreeFlow content delivery service, giving Akamai’s customers a broader selection of streaming media format. Microsoft also agreed to purchase Internet content delivery services from Akamai.

“Akamai’s strategic partnership with Microsoft enables us to join forces in improving content delivery for Web site owners and their customers,” said company CEO George Conrades. “Through this relationship, Akamai expands the strength of our Internet content delivery services to include leading Internet software technologies from Microsoft.”

Drawing Investors and Customers

Akamai Technologies claims to be the only content delivery service that offers a 100 percent guarantee to deliver content across its 900 servers in 15 countries. The company has been signing up investors and customers in rapid-fire succession.

In June, Apple made a $12.5 million investment in the company. Cisco Systems followed suit in August with a $49 million investment. Both took equity stakes in Akamai, as did Microsoft in this latest deal. Apple reportedly claimed a 5 percent stake and Cisco Systems a 30 percent stake.

Akamai Technologies spokesman Jeff Young told the E-Commerce Times that the company could not comment on the size of Microsoft’s equity return because the company filed for an initial public offering with the SEC last month and is in the quiet period.

Put to the Test

After test trials of its FreeFlow program earlier this year, Akamai has been busy signing up customers. Yahoo!, Infoseek, the GO Network, the New York Times and others have all signed up for its service.

Said to be capable of supporting the 25 most-heavily-trafficked Web sites at their peak demand simultaneously, the company’s technology will be put to the test next month when its servers deliver content from the NetAid benefit concert. Established to help combat poverty around the world, NetAid will feature concerts by Bono, Jewel, David Bowie and others.

Akamai and Cisco Systems are instrumental in helping to establish the site and deliver the content. It was designed to handle 60 million hits per hour, which could well make it the most technically formidable Web site in Internet history.