Apple Is Looking to the Internet Fast Lane

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Frost & Sullivan analyst Dan Rayburn claims in a new blog post that Apple (NASDAQ:AAPL) has been hard at work recently building its own content delivery network, which through paid deals with Internet service providers will allow Apple to deliver online content to its users faster and more reliably than it can now through its third-party CDNs.

Rayburn has written extensively about both the CDN and ISP industries, and wrote a post in February saying that Apple has spent the last year building out a team experienced with the creation of large content delivery networks so that the company could stop relying on current third-party CDN providers Akamai and Level 3. Having its own CDN would allow Apple to deliver a better experience for users of its apps, iTunes video, and software updates. Updates to the iOS operating system in particular take up huge amounts of bandwidth when they are released.

Now Rayburn is saying that Apple’s CDN is nearing completion, and customers will soon begin seeing their content delivered through it. One of the most important aspects of the maneuver is that Apple is looking to make paid deals with ISPs for better, faster bandwidth delivery, something that’s possible now that the Federal Communications Commission’s net neutrality laws were overturned in January. ISPs are now free to make deals with content providers in exchange for access to better Internet service.

“As a part of their build out, Apple is currently negotiating paid interconnection deals with some of the largest ISPs in the U.S. I’m not going to disclose which ISPs they are talking to and what deals they have already done, but it’s interesting to note that with all the talk lately of net neutrality, peering and interconnect relationships, Apple isn’t out in the market making any complaints,” Rayburn said. “While Netflix (NASDAQ:NFLX) has used the media, consumers, and lawmakers to try and argue that CDNs should get as much peering as they want, at no charge, Apple doesn’t seem to agree with that sentiment.”