Industry Insights
The global content delivery network market size was worth USD 10.58 billion in 2018. The market is anticipated to exhibit 11.7% of CAGR over the forecast duration, 2019 to 2025. Increasing volume of content sharing over internet coupled with easy accessibility of high-speed internet connection is driving the market growth. With the increasing demand for Over the Top (OTT) and Video-on-Demand (VOD) services, the demand for uninterrupted content delivery is gaining traction. Easy availability of mobile network and broadband services coupled with a significant reduction in data cost is attributing to the growth of the market.
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The e-commerce industry has been changed considerably owing to dynamic consumers’ preference. CDN solution helps the consumer in making an informed decision before purchasing any items. The popularity of CDN solution is gaining traction owing to consumer preferences for video content over their mobile instead of television. Further, the integration of CDN with IoT solutions has led to the introduction of customized CDN solutions. Additionally, increasing penetration of the latest technologies such as augmented reality (AR) and artificial intelligence (AI) is an opening opportunity for the market players.
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The growing demand for OTT and VOD content is prompting service providers to offer content without latency and thereby, improve the delivery of video content. Additionally, heavy investment in building network infrastructure has strengthened connectivity, improved content delivery, increased bandwidth, thereby enhances connectivity for consumers.
The popularity of digital marketing and online gaming is gaining traction in countries such as China and India. Further, technological advancements and rollout of 5G network are also creating a lucrative opportunity. To stay competitive in the market, key service providers are focusing on vertical and horizontal integration. Additionally, the increasing digitalization of the media and entertainment industry is further supplementing the industry growth.
Content-Type Insights
Depending on the content, the content delivery network (CDN) market is categorized into dynamic CDN and static CDN. In 2018, the dynamic CDN accounted for USD 6,979.6 million, primarily because of increasing demand for video-streaming services in real-time, increasing demand for online gaming and voice over IP (VoIP). Consumers prefer to access a variety of content on single platforms and operators are aiming to provide through network and delivery optimization technique.
Increasing demand for better e-commerce services from consumers is also proliferating the growth of the CDN solutions. Changing consumer’s preferences is supplemented by increasing penetration of digital devices and easy availability of high-speed internet. E-commerce players and retailers are continuously trying to offer improved content owing to cater to changing consumer demand.
Solution Insights
By solution, the market is segregated into web performance optimization, cloud security and media delivery. Of them, in 2018 the media delivery category held the largest share in the market with over 44.8%. The growing number of digital devices coupled with easy accessibility of high-speed internet has provided consumers with an option to access the desired content anywhere and anytime. For delivery of latency-free media, the demand for content delivery network solution is estimated to increase from 2019 to 2025.
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Web performance optimization category is predicted to witness the highest CAGR of 12.1% over the forecast period. Rising demand for Quality of Service (QoS) and Quality of Experience (QoE) is driving the growth of this segment. Owing to the rise in the number of connected IT devices, the demand for better content delivery and robust data network is increasing consequently, driving the growth of CDN solution. On the other hand, cloud security division is likely to expand at a CAGR of 11.8% due to rising concern for information privacy and data security.
Service Providers Insights
On the basis of the service provider, the market is segmented into free CDN, telecom CDN, peer to peer CDN and traditional commercial CDN. In 2018, the commercial CDN category accounted for 4,096.8 million in the overall market and emerged as the largest shareholders. Media delivery content acceleration and network optimization solution offered by the service providers is leading to the growth of this segment. Additionally, rising data consumption worldwide is promoting service providers to introduce content delivery optimization.
The peer-to-peer (P2P) CDN category is estimated to exhibit the highest growth rate over the forecast period. Improved service quality and low cost are driving the demand for this segment. Growing digitalization of various industries and increasing network utilization has resulted in a rise in demand for improved content delivery, thereby, supplementing segment growth. Additionally, the rapidly growing e-commerce industry in MEA and APAC owing to availability of the high-speed network is further driving the segment growth.
Application Insights
By application, the CDN market is bifurcated into media and entertainment, healthcare, online gaming, IT telecom, travel & tourism, BFSI, retail & e-commerce and public sector. In 2018, the media and entertainment category held 18.9% of the share in the market. Owing to rapidly growing media and entertainment industry, the demand for content delivery and network optimization has increased, thereby, augmenting the segment growth.
Healthcare division is estimated to expand at a CAGR of over 12.0% over the forecast period owing to rapid digitalization of healthcare infrastructure. The increasing use of advanced technology in healthcare is allowing healthcare service providers to gather patients’ data and share them over a network for accurate and easy diagnoses. Moreover, healthcare players store patients’ data online thus, they require effective data network. However, delivery of content over a network may lead a breach of privacy and security.
Regional Insights
In 2018, North America accounted for the highest share in the market with over 41% of the share in the market. Increasing demand for 4K contents, rapidly rising population of internet users and availability of high-speed internet connection is attributing to the growth of the market. Additionally, the presence of various CDN providers attributes to the growth of the market. For example, major companies such as Akamai Technologies, Cloudflare, Microsoft, Akamai Technologies and AWS among others.
APAC is projected to expand at a CAGR of 14.0% from 2019 to 2025. Increasing media and entertainment industry, rapidly growing e-commerce industry and rolling out of high-speed internet connectivity are augmenting the regional growth. Middle East &Africa, on the other hand is witnessing significant growth in the e-commerce industry and installation of high-speed network connectivity.
Impact of COVID-19
COVID-19 pandemic has a moderate effect on the content delivery network (CDN) market. The outbreak of COVID-19 has led to the closure of various operations thereby, delaying the fulfillment of various network-related infrastructure projects. Additionally, the demand from BFSI and travel industries has witnessed a significant decline as these sectors were forced to close their operations. However, the demand for CDN is gaining traction from the media & entertainment industry owing to increasing consumption in content as people are staying at their homes. Additionally, healthcare and e-commerce sectors are gaining increasing demand for CDN solutions thereby, proliferating the market growth.
Key Companies & Market Share Insights
Leading players operating in the market are Google Inc., IBM, Century Link, Verizon Communications Inc., Amazon Web Services Inc. and Akamai Technologies among others. Key players in the market are holding considerable share. Further, to consolidate their position, the market players are taking several initiatives such as merger & acquisition, launch of innovative products, partnerships and collaborations.
For example, Fastly, Inc., in April 2017, optimized its on-demand delivery of video content and live streaming features through Media Shield. This technology controls CDNs traffic and route them to a single point, thereby, speeding up video streaming services. Similarly, CD Networks in collaboration with Net Insight intended to launch True Live OTT solution for streaming.
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