Toby Smith Stock Review

[MLD38]

Video Prophet, Fat File, Ubiquitous Courier

Is it dot-com blather, a folly, stock swindle, etc?

NOTEs: I do not have a position in AKAM, but thought these might be of interest. While Video Prophet (very long 04.23.07 Forbes Cover and story) & Fat File Paradox & Cyberworld's Ubiquitous Courier, are mainly about AKAM, the history and detail reveal the struggles involved in startups and shine some light on content delivery, etc..

Video Prophet
On The Cover/Top Stories by Scott Woolley 04.23.07
http://www.forbes.com/free_forbes/2007/0423/068.html

Starts off:
..."Paul Sagan has ridden hard over the wildest extremes of the Internet economy. In 1999 he stumbled into a $700 million fortune--on paper--by joining a brilliantly conceived startup called Akamai Technologies, which provided superfast digital delivery services to dozens of new Web sites. Then Sagan watched as the dot-com boom blew up. Akamai's Web site customers went bust, and Akamai plunged toward bankruptcy. Shareholders filed ten lawsuits, alleging a stock swindle."...

And then came the worst blow of all:
....Daniel Lewin, the brilliant young founder at the heart of the company, was killed on 09/11/01 by terrorists. He left a wife and two young sons. He was 31....

Later in the article, you will find:
..."Danny" is Daniel Lewin, Akamai's founder, an MIT-trained mathematician who conceived the algorithms and concepts that would form the business. On Sept. 11, 2001 Lewin, Akamai's chief technology officer, boarded the American Airlines (AMR) flight from Boston to Los Angeles, on his way to a business meeting. Lewin settled into seat 9B in business class. One row ahead of him, on the other side of the aisle, sat Mohamed Atta.

A pair of hijackers got up from their seats in the second row and forced their way into the cockpit. They were followed by Atta, the only trained pilot in the group. No one knows for certain what happened next, but according to the 9/11 Commission, Lewin--a former commando in the Israeli army--likely tried to fight four hijackers singlehandedly, unaware of a fifth, seated directly behind him.

Flight attendant Betty Ong radioed the news of Lewin's battle to stunned co-workers on the ground: "Somebody's stabbed in business class." Half an hour later, at 8:46 a.m., the Boeing (BA) 767 slammed into the North Tower of the World Trade Center. Daniel Lewin left a wife and two young sons. He was 31.

Paul Sagan, like the rest of Akamai's devastated employees, was left to question whether Danny Lewin's company had any chance of surviving his murder. Akamai had $101 million in cash, enough to last just over a year. Its stock, down 99%, was in danger of being delisted from Nasdaq. Lewin's vision of Akamai remaking the Internet suddenly seemed more like hubris than genius. "People told us what we were doing was both crazy and impossible," Sagan says. "It was a horribly dark period."

Yet through it all Sagan and others stubbornly clung to their belief in "the Big Idea"--Danny's idea"....

Includes this: (re was it dot-com blather, a folly, stock swindle, etc?)

..."With startups going broke by the hundreds, Sagan realized Danny's grand vision sounded to the world like all the other dot-com blather. At best Akamai looked like the folly of academic theorists who were not as clever as they thought.

At worst it looked like a stock swindle built on a mountain of mathematical nonsense. The ten investor lawsuits accused the company of defrauding the public during its wildly profitable public offering, as well as of other misdeeds.

In the week following Lewin's death, Sagan spoke frequently with Conrades and Leighton; with Lewin, they always had run Akamai by committee, says Martin Coyne, a board member. "They were and are inseparable."

With Danny dead, they considered giving up. The trio began to ask one another hard questions. Their current customers were disappearing: Could they be replaced? After some debate each of the three agreed they could.

"Look around the room," Conrades said. "Do you believe we have good people?" That one was easy.

Then Conrades asked the most important question: "Do you still believe in the Big Idea?"

Danny's now ridiculed vision of building an infinitely powerful Internet--could they make it real?

Conrades, Sagan and Leighton looked one another in the eye. Despite the trauma and turmoil that Akamai had endured, they still believed.

And there was this: "We had to do it for Danny," Sagan says"....


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In Pictures, "The Cyberworld's Ubiquitous Courier" Slide Show starts off:
http://www.forbes.com/2007/04/05/akamai-itunes-cyber-tech-cz_sc_0405akamai_slide_2.html?boxes=custom
...Even before iTunes debuted in 2003, Akamai collaborated with Apple to figure out a smooth and scalable delivery of music files, and now movies, games and podcasts. Thanks to Akamai, iTunes customers have to date downloaded 2 billion songs, 50 million television episodes and some 1.3 million feature-length films....

Ubiquitous
existing or being everywhere at the same time : constantly encountered ; omnipresent

widespread
widely diffused or prevalent

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Sidebar: A More Clever Internet
http://www.forbes.com/free_forbes/2007/0423/068a.html
Akamai is founded on the notion that the Internet’s basic rules are too dumb for the modern age and need improving. The company’s algorithm writers constantly suss out new ways to get digital data where it’s going in a hurry.

Flash Crowds

BEFORE: A video of a cute tiger cub is loaded onto a computer in India. Word of the video spreads virally around the world. Requests to see it swamp the computer in India.

AFTER: Akamai’s computers deduce where copies will be wanted, make copies of the video and store it around the globe. The more popular it becomes, the more copies Akamai makes.

Fat File Paradox

BEFORE: A user in L.A. requests a movie from New York. Under the Internet’s archaic rules, after sending 128,000 bits of data the computer in NYC must wait for a confirmation it all got to L.A. (In the old days that rule kept the Web from getting clogged with misdirected bits.) Now, an hourlong, billion-bit movie might require 8,000 back-andforth acknowledgments. Even though the data travel most of the way at the speed of light, this can still add a delay of half an hour.

AFTER: Akamai sends the movie between two of its own servers, ignoring old Internet rules and zipping across the country in seconds. The movie travels only the last few miles on the public Internet.

Line Cuts

BEFORE: When a tsunami snapped undersea cables in Asia recently, regular Internet traffic stacked up. For a week 25% of packets sent to Asia were lost.

AFTER: Akamai’s complex algorithms deduce optimal routes, learning which paths to avoid. Even after the tsunami, fewer than 1% of packets sent via Akamai failed to reach their destinations in Asia.