RealTime IT News

Akamai, Softbank Form Joint Venture

Akamai Technologies , of Cambridge, Mass., has formed a joint venture with Softbank Broadmedia, of Tokyo, to sell Internet content delivery services in Japan.

The new entity, Akamai Technologies Japan KK, will be run on an interim basis by Softbank Broadmedia CEO Taro Hashimoto.

The initiative aims to extend Akamai's market lead in that country. It already has several hundred servers throughout service provider networks, transmitting online audio, video and other rich media to users there.

Akamai CEO George Conrades said partnering with Softbank Broadmedia, a subsidiary of investor Softbank, provides access to customers and a guide to doing business in Japan. For example, Softbank, a Yahoo! shareholder, was instrumental in the success of Yahoo! Japan portal.

"We are thrilled to be doing business with the leading player in helping U.S. companies enter the Japanese market," Conrades said. "Softbank has a proven ability to take innovative companies and technologies and to penetrate them into the Japanese market as an industry standard."

And the market is expanding. According to the Electronic Commerce Promotion Council of Japan, business-to-consumer e-commerce is expected to jump 762 percent by 2004. An recent IBM Japan survey showed that 56 percent of small and mid-sized businesses in Japan now have an Internet presence.

The added business will also help Akamai continue pushing toward profitability, said Conrades, who, along with Softbank president and CEO Masayoshi Son, will sit on the Akamai Technologies Japan KK board of directors.

For its part, Softbank sees a need for Akamai's service. In addition, better Web access and download speeds can only help the Internet industry in Japan, which through equity stakes in startups, Softbank, is heavily invested in.

"We believe Akamai Technologies Japan KK will have an immediate impact on Japanese businesses that are interested in achieving reduced costs on their Web infrastructure needs, while at the same time maximizing the overall performance of their Web initiatives," Son said.

At midday, shares of AKAM were down .875, or nearly 10 percent, to 8.125. In the last 52 weeks, the issue has traded between 227.875 and 7.25.