Cisco, Apple invest in Akamai

Akamai Technologies has attracted a couple of big-name investors: Cisco Systems and Apple Computer both have bought into the Cambridge, Massachusetts-based startup that offers Internet content delivery services.

The Cisco deal was announced yesterday and the Apple investment, made in June, was revealed. As an indication of the fast track Akamai seems to be on, the Cisco investment of $US49 million amounts to a 4 per cent stake in the company, while Apple's $12.5 million June investment bought it about 5 per cent of Akamai, which is privately held.

Networking giant Cisco and Akamai will work together on new content routing, switching and caching technologies aimed at boosting Internet content delivery, said Akamai chairman and chief executive officer George Conrades. Akamai customers include CNN, Go Network and Yahoo.

Cisco, in San Jose, California, wants to offer content-based routing, switching and storage and so tagged Akamai as a partner in that endeavor. The companies intend to develop protocols and algorithms related to content-based routing and switching for Cisco software and hardware. Akamai's Internet content delivery technology will be integrated into Cisco's networking technology.

"Cisco knows that the expansion of the Web is critical right now," Conrades said, adding that the networking vendor cannot overcome the issue of Net congestion on its own, but needed to grab on to a technology such as Akamai's that can help alleviate routing problems.

The combination of the two companies' efforts will lead to "optimal routing [of Internet content] without having to change or break any of the fundamental protocols in place today", Conrades said. The aim is to enhance content routing by assessing with more accuracy where content resides on the Internet and determining which users want particular content.

Specifics regarding the development agreement between the two companies are confidential, so Conrades was unable to provide many details about exactly how Cisco and Akamai will achieve the goals of the deal.

For those curious about the origin of the name, Akamai is Hawaiian and means "intelligent, clever and cool", according to the company, which was founded a year ago this Friday. Akamai had 30 employees in January of this year, and now has 150 with 70 of them involved in research and development, Conrades said. Fifteen of the research and development employees have doctorate degrees, with the company taking advantage of its proximity to the Massachusetts Institute of Technology (MIT) -- another investor in Akamai -- for recruitment.

The deals with Apple and Cisco will spur additional hiring, Conrades said, noting that the burst of publicity also means Akamai will boost its marketing and sales force.

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