The Internet is the pulse engine of today's economy, requiring
gear at billions of junctions interconnected by millions of miles
of fiber cable and wireless technology.
It's continuously under construction, growing larger and more
complex, with trillions of data "packets" -- bursts of digital
information -- delivered daily.
Diverse companies hustle to develop and re-invent the
equipment and programs needed to manage this massive flow of
Among the players at the head of that pack areAkamai
),F5 Networks (
),Aruba Networks (
) andEquinix (
Along with the other 26 companies tracked in IBD's
Internet-Network Solutions group, they provide the equipment,
software and data services able to route information, e-commerce,
streaming video, graphics, wireless services and more to millions
of website addresses worldwide.
The Internet is set to get much larger. Vast amounts of
traffic are poised to come online with the evolution of smart
technologies connecting autos, homes, aircraft and other sources
to the Web.
The Internet Of Things
) has been investing heavily in just such connections. It
recently bought its way into the "smart home" market, acquiring
Nest Labs for $3.2 billion. Nest Labs makes thermostats that
learn from, and adjust to, user settings. It also makes high-tech
smoke detectors. The acquisition provided Google entry into the
market for Web-connected household appliances.
"Google will help us fully realize our vision of the conscious
home," Nest CEO Tony Fadell wrote in a blog post when the deal
Google has long been investing in smart technologies,
including its development of Internet-connected, self-driving
cars and the eye-catching Google Glass. All three business groups
fit into an emerging field called "the Internet of things,"
whichCisco Systems (CSCO) recently deemed a fast-growing,
The Internet of things defines a concept in which any device
that can benefit from an Internet connection should get one. It
includes parking spaces, vending machines, irrigation systems,
electrical grids, surveillance systems and health care
Machine-to-machine communications are central to the concept.
M2M devices share data via Wi-Fi or Bluetooth through a cellular
network or with a direct connection to the Internet.
The Internet of things and M2M are not new. Some estimates put
the number of devices already attached to computer networks at 2
billion. Others place the number much higher.
"It's an old business and a new business," said Godfrey Chua,
analyst at Infonetics Research. "But now the networks are more
widely deployed, the cost of connecting devices is coming down
and it's widely supported by governments and business."
It's among the reasons the amount of data traversing the
Internet is growing at exponential rates.
Akamai, F5, Aruba and the others are seen taking advantage of
the trend. Their products and services are used to fine-tune the
speed, efficiency and security of the Internet.
Fighting An Army Of Ants
Akamai delivers content and applications across a globally
distributed network of servers. It handles more than 2 trillion
requests per day from more than a billion users. Companies use
its services to deliver Internet content quickly, in addition to
live and on-demand streaming video. Users of its technology
include Apple, FedEx, Home Depot and IBM. Public-sector customers
include the Federal Aviation Administration, the U.S. Department
of Defense and Department of Labor.
In 2013, Akamai revenue rose 15% to $1.58 billion.
In December, Akamai acquired Prolexic Technologies for $370
million. Prolexic provides cloud-based security solutions for
protecting data centers from distribute denial-of-service
attacks, an area to which Akamai is giving increased
In a DDoS attack, the target is intentionally bombarded with
information requests that overwhelm servers and cause them to
malfunction. While businesses deploy various security
technologies to prevent hackers from accessing sensitive data, a
DDoS attack is not as easily prevented. It's like fighting an
army of ants.
"Traditional security solutions are ineffective against DDoS
attacks," said Robert Blumofe, executive vice president of the
Akamai Platform Division. With the addition of Prolexic, Akamai
fortified its arsenal of solutions.
"Our customers want the same level of performance everywhere
around the world," said Blumofe. "The reliability of packet flow
is extremely important, and they come to us for that
The New Home: Mobile
Cisco estimates that global Internet traffic will increase at
a compound annual rate of 23% from 2013 through 2017. Much of
that growth is expected to come from mobile data traffic, which
rose 81% in 2013.
The ever-growing need to protect and speed the delivery of
applications and data across the Internet has a lot to do with
demand created by smartphones, tablets and other mobile devices.
Among those playing an essential role in helping businesses deal
with the increasing complexity managing this traffic is F5
The goal of F5 Networks is to ensure the safe, fast and
reliable delivery of Web applications and services across
multiple data centers. F5 Networks is the biggest maker of
application delivery controllers that optimize server workloads
in corporate data centers and telecom networks. Its core
technology is a highly scalable software platform called Traffic
Management Operating System.
F5 designed its products and services to help companies manage
the shift to virtualization and cloud computing, where software
plays an increasingly important role in improving network
efficiency at lower costs. Its products manage strategic points
of control on Internet networks, inspecting, modifying and
directing traffic for increased security and optimization.
Company revenue in 2013 rose 8% to $1.5 billion. Analysts
expect a return to double-digit revenue growth for F5 this year
as it moves deeper into the network security field.
The need for greater security is also strong in mobile, which
is where Aruba Networks steps up to the plate.
400 Million New Smartphones
Aruba's core technology is Mobile Virtual Enterprise, which
helps unify a company's mobile networks, including Wi-Fi systems.
Its technology enables secure access to data, voice and video
applications for enterprises, mobile professionals and remote
workers, across wireless and wired networks.
The explosion of wireless use and the proliferation of
smartphones are causing companies to radically change how they
manage these devices.
The need for Aruba's technology stems partly from the growth
of Wi-Fi networks and the bring-your-own-device trend that allows
employees to carry whatever wireless device they prefer to use
and still have full access, as they would to a wired network.
According to Cisco, the number of mobile devices and
connections rose by 526 million units last year to 7 billion
units worldwide. Smartphones accounted for 77% of that growth, a
staggering 406 million additions.
For its fiscal year ended July 31, 2013, Aruba reported
revenue of $600 million, up 16% from the same period a year ago.
For the six-month period ended Jan. 31, revenue rose 13% to
Another key player in the network infrastructure field, on the
data management side, is Equinix. It builds and leases data
centers to a swath of business segments, including Internet
service providers, software-as-a-service providers, financial
companies, content providers and companies deploying cloud
"Cloud computing is creating massive disruption in the IT
supply chain and will continue to do so at an accelerated pace,
creating opportunities across all of our verticals," said Stephen
Smith, Equinix president and CEO, in a conference call with
analysts last month when the company reported Q4 results. Equinix
has about 4,500 customers.
Demand for its service is also fueled by bandwidth-intensive
services such as video, social media, mobile data and gaming.
Customers include Amazon, AT&T, Microsoft, LinkedIn and
In 2013, Equinix reported revenue of $2.15 billion, up