Akamai will benefit from media rich online shopping experiences
Retailers like Amazon, Nordstrom, and Footlocker use Akamai to provide faster and more secure online shopping experiences for their customers. Information served to online shoppers on these sites is often delivered by a nearby Akamai server rather than the company’s own servers. Serving content for online shopping clients is Akamai’s core business constituting about 37% of the company’s value.
We believe that Akamai could benefit even more from the online shopping business as shopping sites create more media (image and video) rich experiences by increasing adoption of features such as: video demos, video reviews, 360 product views and video tutorials.
Akamai’s existing media content delivery business consists primarily of media customers like ESPN, CBS and MySpace. The company benefits from revenue per media customer that is 2x higher than revenue per online shopping customer.
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How much of Akamai’s value do you think would come from the online shopping segment if revenue per online shopping customer were to double due to more media rich shopping sites?
A. 45%
B. 55%
C. 65%
D. 75%
Make a selection above and modify the revenue per online shopping customer forecast to see the answer.