Akamai close to being acquired by Google
reuters.com
reuters.com
to whoever saw fit to downvote this: I hope that people will still remember your name a decade after you die through no fault of your own when you co-found a company as successful as Akamai.
http://en.wikipedia.org/wiki/Daniel_M._Lewin
The man was a true hero as far as I'm concerned.
Maybe if you're a startup being acquired by bigco, it is a feather in your hat. A bigco being acquired by another bigco is a failure for acquiree and not something to crown yourself about.
Google Inc. (GOOG) isn’t planning to acquire Akamai Technologies Inc. (AKAM), two people familiar with the matter said, countering a report in Business Insider that fueled speculation a takeover may be imminent.
http://www.businessinsider.com/google-move-2011-10
BI's version actually has more background and analysis, in addition to being the source.
And yes, diversification is also dirty. Diversification is the worst reason for companies to merge. If I wanted to own both Google and Ackamai, I could just buy shares in both companies. Investors should be responsible for diversification. There must be a reason that the combined companies are worth more for this acquisition to make sense. My thought is this will create negative value because major customers (MS/Apple/Facebook) don't want Google to see their traffic logs.
Why should he not be allowed to diversify but you would be? Companies can invest in other companies, the shareholders diversify indirectly. And if you don't agree, you can always sell your google stock.
If MS/Apple/Facebook don't want google to look into their kitchen then they are of course entirely free to set up their own CDNs, and if they leave and you think that this will create negative value you can make a killing by shorting the stock.
I'm not brave enough for that though, and I don't presume to know which way that will go.
There is a pretty significant difference between Google buying Akamai with it's money and Larry Page buying it with his.
No you can't. Even if it turns out to be a disaster, it will only impact Google's stock price by roughly 5%. $5B is just noise in Google's market cap.
Akamai has a large patent portfolio for streaming and content delivery and a long list of top-tier customers.
It seems like these are clearly anti-competitive moves meant to put their competitors at their mercy.
With Akamai, not so much.
Akamai & Google already have duplicate CDN/Endpoint infrastructure (albeit Akamai's is a CDN platform and Google just delivers for their properties). Akamai has something like 61k servers in most (if not all) major datacenters/ISPs and key peering agreements. Major overlap.. DNS/HTTP(s)/Streaming(youtube)/Data Mining, etc. This could possibly be a big revenue boost for Google in that they consolidate existing peering agreements, etc. and consolidate servers within the last couple miles. Google already does many of these things but it is Akamai's sole business and they do it very well! Probably a big win for Google to have the talent and relationships that Akamai already has. Akamai customers benefit from Googles infrastructure & people.
Edit: context + grammer
Google can mine that data and use it in their core product, the search engine.
I guess there could be some issues since this makes Google's competitors in other markets reliant on them, but from a "too much good infrastructure in one company" standpoint, I don't see how there would be anti-trust concerns.
Why would they want to make other sites on the web faster?
They rely very heavily on web, and it's absolutely important for them to speed up web for people to keep moving away from native.
For example, Apple historically has used Akamai for their content delivery, but as of around ~2009, they began to use Limelight in conjunction with Akamai. Just today with the iOS 5/OS X updates, I noticed at home in Los Angeles that the delivery from Limelight was terrible. I tried it again about an hour after release, and I was then being sent to Level3.
Suffice to say, Apple is now using three CDNs.