Posted by : Randy Cooper in (CDN)

Crunch Time for Internap CDN?

Internap Network Services Corp. (Nasdaq: INAP) may be approaching a moment of truth for its content delivery network (CDN) business, which is struggling on a number of levels. The company’s share price has taken a 30 percent haircut after it announced weak sales in an earnings call last week. In addition, a significant number of the company’s CDN sales and marketing team has been fleeing to competitors, according to industry sources. Other complications include the company’s struggle with outages that occurred during the integration of VitalStream’s CDN into Internap’s IP network. After sales declined last quarter, one analyst says it might be time for Internap Network Services Corp. (Nasdaq: INAP) to “blow up” its CDN business. Merriman Curhan Ford & Co. analyst Colby Synesael says, “Even if they do improve the solution to fix the scalability, in the hands of Internap no one’s going to be willing to go to that [CDN] platform.” “They’re probably going to blow up the CDN business,” Synesael says. “It probably doesn’t make much sense in their hands anymore, and they’re probably going to write that down next quarter anyway.” Shares of IP services provider Internap fell more than 30 percent last week, after the company reported a wider loss and reduced estimates for the second quarter in a row due to weak sales in CDN.


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