Jase

Akamai: Broadband Consumption Clouds Outlook

Dan, you're on crack. 3MB is absolutely atrocious; it's a crying shame that the US, who developed the IP protocol in the first place, now struggles to catch up to world averages. Consumers in Japan don't blink when they are offered 100MB. The UK does trials of gigabit to the home. Faster broadband *does* equate to more consumption--the experiences are richer, but the broadband simply doesn't exist in the US so many content experiences are purchased by consumers in different formats. Every film watched via Netflix should have been delivered via broadband. Movies are data. Every video game DVD sold should have been delivered via broadband. Video games are data. SaaS solutions are the way of the future; if they can solve the latency issue by pushing the edge servers closer to consumers, then Google is going to dominate the application delivery space. There are no excuses for vast local storage either--platter densities are increasing at a blistering pace, solid state storage costs are plummeting, and the $/GB ratio will continue to drop at such a speed that $/TB will soon become the new metric. Akamai is extremely well poised to capture this grow, when it comes. The key is a new once-and-for-all infrastructure upgrade (802.16 will handle some of this, but hard-wired and optical to the home really are the best solutions in order to be future-proof) that sets the stage for trillions of dollars of content value to be unlocked. In the short to medium term, Akamai's stock price will be a dog. That said, and as odd as it sounds, they will someday take out the $345/share high that they made back in the tech boom. We're unlikely to see that occur until after 2012, but that's another story altogether.