CDN Pricing Up Slightly This Year, Trend Not Expected to Continue

While most people assume that the cost of bandwidth is continuing to decline, the cost of delivering video over a content delivery network has gone up slightly this year. The big price drop in bandwidth has been on the network side of the business as opposed to the delivery side. Since most CDNs still charge on a per GB delivered model, that pricing has been pretty stable over the past 12 months, and in the last 6 months we've seen a price increase of between $0.02 - $0.03 per GB delivered.

The reason for this is primarily that CDN providers are no longer selling on price alone. They are selling on customer service, SLA, geographic reach, customized reporting and additional value ad services like content management and the like. And on the flip side, customers are now buying services based on these factors as opposed to just who gives the lowest pricing, which is the way they should all be buying.

Based on the pricing I have seen in the market, which comes directly from customers contracts and RFPs that are sent to me weekly asking for feedback, below is a breakdown range on the latest pricing trends for delivering audio and video content, across CDNs like Akamai (AKAM), CacheLogic, Internap (INAP), Limelight Networks (LLNW), Mirror Image, NaviSite (NAVI) and VeriSign (VRSN).

1TB: High, $2.00GB, Low $1.50GB

5TB: High, $1.60GB, Low $0.95GB

10TB: High, $1.20GB, Low $0.89GB

25TB: High, $0.95GB, Low $0.75GB

50TB: High, $0.65, Low, $0.45GB

100TB: High, $0.29, Low, $0.19

Above 100TB: It's all over the map

While delivery pricing will always vary based on many factors, the most important of which is the customers needs, the above pricing is the going rate today for delivery on all of the major CDNs. While I have seen that pricing rise slightly, I don't see the trend continuing for the rest of the year. I think the slight rise we have seen for the per GB delivered pricing model will pretty much flatten out the rest of the year.

For more details on pricing, you can watch my presentation from the Streaming Media East show in May entitled "HOW TO: Costs for Outsourced Hosting And Video Delivery" and can read my article from February entitled "How to Shop for Video Hosting: Five Questions To Ask".