NeoMedia Technologies, Inc (NEOM)

[sonofgodzilla]

DD: A VeriSign Move Into Digital Content



By Clint Boulton March 13, 2006

http://www.internetnews.com/bus-news/print.php/3591101

VeriSign today said it is entering the market for delivering broadband content services by agreeing to purchase Kontiki for $62 million in cash.

Kontiki makes Delivery Management System (DMS), a grid software platform designed to pipe video, software and other forms of digital content to employees, partners and customers over the Internet.

In grid fashion, Kontiki DMS uses existing PCs on the network as video content delivery "microservers" that deliver large files efficiently and quickly to those who request them.

But unlike other digital media delivery providers, the Mountain View, Calif., company's value proposition is that its software actually gets better at moving video and other large files as demand grows.

VeriSign will use Kontiki's system as the cornerstone of its broadband content services platform, shuttling content over broadband networks to personal computers, television sets and portable devices.

"From our standpoint, there is a convergence happening, not on the device side but on the network side," said Jeff Treuhaft, senior vice president of digital content services for VeriSign.

"We really see folks, whether it's a content owner, a media brand or an operator, wanting to take advantage of tying together the mobile handset, the PC and IP-connected television experience into something the consumer gets really excited about," Treuhaft said in a phone interview.

Treuhaft said the deal puts the company in a leadership position in the broadband content services market, noting that Kontiki has strung together a number of successful consumer experiences on the enterprise and consumer sides.

AOL, BSkyB, Verizon and others use Kontiki's DMS to deliver branded video content to desktops.

VeriSign expects the deal to close in the first quarter of 2006, with most of Kontiki's 34 employees joining VeriSign's headquarters around the corner in Mountain View.

Delivering massive loads of digital content has been kicked around as a concept for a few years. So has the technology to do it. But there have been a couple of limitations, including the inability to provide software that can scale enough to send large amounts of content.

Another pitfall has been the lack of broadband connections in residences.

But many Internet experts say broadband demand is growing, which should change the game for vendors who have the chops to pipe the content to homes and offices.

VeriSign is banking on this with the Kontiki buy, and should be able to use it to complement its already strong mobile content services offerings.

The company, which has been evolving from the leading domain name registry to an information and entertainment services business, is already providing a variety of services for large brands across mobility networks in Europe and the U.S.

Treuhaft said purchases such as Unimobile, Lightsurf, Jamba and 3united have provided the mobile messaging, wireless content and other services for this venture.

**********************************************************************************************************************************
Verisign to acquire Kontiki for $62 million
Steven Schwankert

VeriSign Inc. Tuesday announced plans to acquire Kontiki Inc. for US$62 million with the intention of entering the broadband content services market, the company said in a statement.

Kontiki’s platform will form the "cornerstone" of VeriSign’s Broadband Content Services, to support legal distribution of rich digital media over IP networks, VerSign said.

The transaction is being accounted for as a purchase transaction and is expected to close in the first quarter of 2006. The financial impact of the transaction will be disclosed following the closing, VeriSign said.

VeriSign also said it has completed the acquisition of 3united Mobile Solutions AG, for which it paid €55 million (US$65.8 million).
**********************************************************************************************************************************
VeriSign Buys Broadband P2P Company Kontiki
http://www.playfuls.com/news_01580_VeriSign_Buys_Broadband_P2P_Company_Kontiki.html

01:35 AM, March 14th 2006 by Gabriela

Looking forward to expand itself in the broadband peer-to-peer content services area, VeriSign announced this Monday that it will acquire Kontiki for $62 million in cash. The transaction is expected to be over in the first quarter of the year and Kontiki will become a part of VeriSign's communication services business division.

Founded in 2001 by several Netscape alumni, Kontiki has 34 employees and is based in Mountain View, California. Its profits have reached a sum of about $46.5 million so far and among the investors are companies like The Barksdale Group, Benchmark Capital, and Adobe Ventures.

"In today's 'any era' where consumers are driving demand for how, when and where content gets delivered, VeriSign is investing in building an intelligent infrastructure for operators, Internet portals, media companies and consumer brands to use to deliver content to all... screens", Vernon Irvin, general manager of VeriSign Communications Services, declared in a statement.

Kontiki's system will help power VeriSign's broadband content services technology to enable it to deliver rich media over broadband networks to computers, TV sets and portable gadgets, according to the companies.

Kontiki distributed such content for some of the biggest names in the business, including United Kingdom satellite television firm Sky, a subsidiary of Rupert Murdoch’s News Corp which announced in January that it would make more than 200 movies available for no additional fee to its 8 million UK subscribers who use Kontiki.

Among the larger companies that deliver video to customers' desktops based on Kontiki’s technology are also AOL and Verizon, as there are clear economic advantages to using this distribution method and the system protects both content owner and distributor rights.

"It was a kind of an ideal match on both sides", said Kontiki CEO Todd Johnson. "It takes the alternative approach of Kontiki to delivery of digital content and nests it inside the security and scale of VeriSign."

Referring to the deal, Stifel Nicolaus analyst Todd Weller said that it makes sense for at least two reasons.

"First, we believe there is a clear trend towards more digital content being delivered over IP networks, and second, this acquisition enables VeriSign to provide infrastructure capabilities in this area, which is consistent with its core competency."