I had the opportunity to review the ATLAS Internet Observatory report recently and one table struck me as quite compelling. The Table was a listing of the percent of anonymous ASN data ranked from highest to lowest.
In 2007 the top 1o list was:
1. Level 3 5.77%
2. Global Crossing 4.55%
3. ATT 3.35%
4. Sprint 3.20%
5. NTT 2.60%
6. Cogent 2.77%
7. Verizon 2.24%
8. TeliaSonera 1.82%
9. Savvis 1.35%
10. AboveNet 1.23%
To a great degree these are the classic Tier 1 Internet providers, the Club.
Now for 2009 the listings are:
1. Level 3 9.41%
2. Global Crossing 5.7%
3. Google 5.2%
4
5
6. Comcast 3.12%
7
8
9
10
Now the unlisted entries refused to have their names published. Interesting. But more interesting is that Google came from nowhere to No 3! And Comcast is No 6. Content is exploding.
Yet more importantly Google, as is Comcast, are NOT Tier 1 club members yet have some but not all the advantages of membership. If Google were to buy Level 3 then they would have almost 15% of the 2009 numbers and we estimate that by 2012 they would have well over 25%.
Thus where did Verizon and ATT go and what should they do. Remember that once Verizon owned Genuity which the let go bankrupt! That was the old BBN network, the starter of the Internet. They just let it die. So will;l Verizon just fade away in the Internet space as backbones go, doubtful. What will ATT do, good question.
The recent focus has been on the FCC and Net Neutrality, but behind the scenes in the backbone there is a war.
Thus is Google were to buy out Level 3 it would be one of several acquisition steps. Let us look at the numbers.
Level 3 Market Cap = 2.22B
Google Market Cap = 175.37B
A slam dunk for Google, cash or a stock deal! Could Verizon or ATT do this?
Verizon Market Cap = 82.4B
ATT Market Cap = $153B
The answer is anyone of these could and it would bid up Level 3. It would create an interesting opportunity. I suspect that it may very well happen.
Now number two for Google is a position in wireless, well look at Sprint.
Sprint Market Cap = 9.2B
Again it is small change for Google and it gets Google WiMax and cellular and 4G capability.
Are these two moves possible and would they change the landscape. Possible but I come back again to the issue of what is Google's business model. It should be the electronic shopping mall, they may not have to own the roads, yet given the FCC's actions that may find that an inexpensive and strategic move.
In 2007 the top 1o list was:
1. Level 3 5.77%
2. Global Crossing 4.55%
3. ATT 3.35%
4. Sprint 3.20%
5. NTT 2.60%
6. Cogent 2.77%
7. Verizon 2.24%
8. TeliaSonera 1.82%
9. Savvis 1.35%
10. AboveNet 1.23%
To a great degree these are the classic Tier 1 Internet providers, the Club.
Now for 2009 the listings are:
1. Level 3 9.41%
2. Global Crossing 5.7%
3. Google 5.2%
4
5
6. Comcast 3.12%
7
8
9
10
Now the unlisted entries refused to have their names published. Interesting. But more interesting is that Google came from nowhere to No 3! And Comcast is No 6. Content is exploding.
Yet more importantly Google, as is Comcast, are NOT Tier 1 club members yet have some but not all the advantages of membership. If Google were to buy Level 3 then they would have almost 15% of the 2009 numbers and we estimate that by 2012 they would have well over 25%.
Thus where did Verizon and ATT go and what should they do. Remember that once Verizon owned Genuity which the let go bankrupt! That was the old BBN network, the starter of the Internet. They just let it die. So will;l Verizon just fade away in the Internet space as backbones go, doubtful. What will ATT do, good question.
The recent focus has been on the FCC and Net Neutrality, but behind the scenes in the backbone there is a war.
Thus is Google were to buy out Level 3 it would be one of several acquisition steps. Let us look at the numbers.
Level 3 Market Cap = 2.22B
Google Market Cap = 175.37B
A slam dunk for Google, cash or a stock deal! Could Verizon or ATT do this?
Verizon Market Cap = 82.4B
ATT Market Cap = $153B
The answer is anyone of these could and it would bid up Level 3. It would create an interesting opportunity. I suspect that it may very well happen.
Now number two for Google is a position in wireless, well look at Sprint.
Sprint Market Cap = 9.2B
Again it is small change for Google and it gets Google WiMax and cellular and 4G capability.
Are these two moves possible and would they change the landscape. Possible but I come back again to the issue of what is Google's business model. It should be the electronic shopping mall, they may not have to own the roads, yet given the FCC's actions that may find that an inexpensive and strategic move.
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