RealTime IT News

Inktomi Tucks in Parts of Adero

Inktomi Corp. Friday took on the billing, settlement and traffic reporting elements of Adero Inc. for $23.5 million in cash.

With the acquisitions, Inktomi will now spearhead the Content Bridge alliance, initially founded by Adero, Digital Island, Exodus Communications, Genuity, Madge.web, Mirror Image Internet and NetRail to promote cross-network content distribution and speed data from the point of origin to end users -- a pact some analysts have viewed as a way to gang up on 800-pound gorilla Akamai Networks Inc.

Inktomi, which announced this week that first-quarter earnings per share would miss Wall Street forecasts by more than 60 percent, believes the addition will help its status as a speedy data provider by spurring content peering between multiple service provider networks.

As the operator of Content Bridge alliance services, Inktomi will facilitate content delivery and updates across all member networks and provide billing and settlement services for cross-network transactions.

David Peterschmidt, president and chief executive officer of Inktomi, said his company brokered the deal to foster participation in the next generation of network cooperation on the Internet.

Adero CEO Jonathan Crane said the deal will his firm refocus on offering its content delivery network services.

"With Adero's foothold in the content distribution market, we have made the decision to focus our service offerings exclusively on this opportunity," Crane said. "We will remain an active member of the Content Bridge alliance and will use it to establish a truly global reach for our content provider customers."

Inktomi anticipates integrating the acquired assets into its Content Bridge operations with various employees of Adero joining Inktomi. The acquisition is not expected to have a significant impact on the ongoing results of operations of Inktomi in fiscal 2001.

The news did nothing for Inktomi's stock, which dropped a total of about $6 this week on lower-than-expected earnings news. The company Wednesday said its earnings for the first quarter would be between 1 cent and break-even a diluted share while analysts had pegged Inktomi's earnings at 3 cents per share.

Friday's deal coincides with new products from the Content Bridge alliance as well, as the members have banded together to offer content peering services, which yields seamless content flow among networks.

More than 150 Inktomi customers are using the new peering services, including Cambridge Soundworks (Hifi.com), Handspring, iWon and The Sharper Image.