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A Forrester Total Economic Impact Study Commissioned By AkamaiJuly 2019The Total EconomicImpact Of AkamaiEdge Security ProductsFor Broadcasting AndOTT CustomersCost Savings And Business BenefitsEnabled By Edge Security Products ForBroadcasting/OTT Customers
Table Of ContentsExecutive SummaryKey Findings11TEI Framework And Methodology3Akamai’s Edge Security Products For Broadcasting And OTTCustomers — A Customer JourneyInterviewed And Surveyed Customers44Key Challenges And Goals4Composite Organization4Key Results5Analysis Of BenefitsBenefit 1: Cost Savings — Fewer FTEs To Support Edge Security66Benefit 2: Incremental Revenue (Gross Profit) Associated WithAkamai7Benefit 3: Reduced Spending On Hardware8Benefit 4: Savings From Decommissioning Legacy Software Products8Unquantified Benefits10Flexibility10Costs11Financial SummaryAkamai Edge Security Products For Broadcasting And OTTCustomers: OverviewAppendix A: Total Economic ImpactProject Director:Bob Cormier, Vice Presidentand Principal ConsultantEdgar Casildo, AssociateConsultant121314ABOUT FORRESTER CONSULTINGForrester Consulting provides independent and objective research-basedconsulting to help leaders succeed in their organizations. Ranging in scope from ashort strategy session to custom projects, Forrester’s Consulting services connectyou directly with research analysts who apply expert insight to your specificbusiness challenges. For more information, visit forrester.com/consulting. 2019, Forrester Research, Inc. All rights reserved. Unauthorized reproductionis strictly prohibited. Information is based on best available resources.Opinions reflect judgment at the time and are subject to change. Forrester ,Technographics , Forrester Wave, RoleView, TechRadar, and Total EconomicImpact are trademarks of Forrester Research, Inc. All other trademarks are theproperty of their respective companies. For additional information, go toforrester.com.
Executive SummaryBenefitsIncremental revenue and grossprofit: 7.5 millionAkamai provides products that enable broadcasters and over-the-top(OTT) companies to deliver video content to multiple distribution channels.Akamai also provides edge security products that enable these companiesto better secure themselves and their content.Akamai commissioned Forrester Consulting to conduct a Total EconomicImpact (TEI) study and examine the potential benefits broadcasting andOTT enterprises may realize by deploying the following Akamai edgesecurity products: Kona Site Defender (KSD), Prolexic, Bot Manager,Enterprise Threat Protector (ETP), and Enterprise Application Access(EAA). The purpose of this study is to provide readers with a framework toevaluate the potential financial benefits these Akamai edge securityproducts have on broadcasting and OTT organizations.To better understand the benefits, risks, and flexibility associated with thisinvestment, Forrester directly interviewed several Akamai customers andsurveyed 30 more customers with experience using Akamai edge securityproducts for broadcasting and OTT customers.Decommissioning legacy securityproducts: 125,337For this TEI study, Forrester has created a composite Organization toillustrate the benefits of investing in Akamai’s edge security products.Based on characteristics of the interviewed and surveyed customers, thecomposite Organization is an enterprise-sized broadcasting, OTT media,or internet/social video company headquartered in the US, UK, India, orCanada with annual revenues of 1.5 billion.Prior to using Akamai’s edge security products, the broadcasting/OTTOrganization was using a mix of disparate and costly third-party andhomegrown security solutions.Key FindingsReduced hardware spend: 149,211Quantified benefits. The following risk-adjusted present value (PV)benefits total 8,787,414 over three years and are representative of thoseexperienced by the interviewed and surveyed companies:› Cost savings — fewer FTEs needed to support Akamai edgesecurity products, 1,052,310. Compared to its pre-Akamai securityenvironment, the Organization saves 2.5 security administrator FTEs inYear 1 (ramp year) and 3.5 FTEs in Years 2 and 3 of our analysis.Security FTE savings: 1.1 million› Incremental revenue (gross profit), 7,460,556. Prior to its investmentin Akamai, the Organization was losing revenue due to inadequate edgesecurity. Akamai helps the Organization avoid losing 5% of its revenueand therefore 5% of its resulting gross profit. The 7,460,556 quantifiedbenefit is the gross profit associated with avoiding the loss of revenue.› Reduced spending on hardware, 149,211. The Organization wouldhave continued to invest in security infrastructure such as storage,servers, operating system licenses, and annual maintenance to maintainits on-premise legacy security products that were subsequently replacedby Akamai’s edge security products.› Savings from decommissioning legacy security products, 125,337.The Organization decommissions the following legacy security products:distributed denial-of-service (DDoS), bot management solution, virtualprivate network (VPN) services, virtual desktop software subscriptions,and single sign-on (SSO) and multifactor authentication (MFA) services.1 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
Unquantified benefits. The interviewed and surveyed customersexperienced the following benefits, the monetary value of which were notquantified for this study:› Improved site performance during an attack. Estimated load time (inmilliseconds) of site during an attack was 101.7 milliseconds beforeAkamai and 70 milliseconds with Akamai.› A 5.88% reduction in churn rates and an 11.8% decrease in bouncerates.› An improvement in click-through rates, a 6.3% improvement inconversion rates, and improved customer satisfaction.Forrester’s interviews and surveys with over 30 existing customers andsubsequent financial analysis found that the composite Organizationexperienced benefits of 8,787,414 (present value) over three years.Costs. Interviewed and surveyed customers incurred internal labor costsand Akamai fees associated with their investment in Akamai edge securityproducts. For confidentiality reasons at the request of Akamai, these costsare not quantified in this case study. The cost categories are described inthe Costs section. For more information regarding Akamai fees, pleasecontact your Akamai representative.2 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
TEI Framework And MethodologyFrom the information provided in the interviews, Forrester has constructeda Total Economic Impact (TEI) framework for those broadcasting andOTT customers considering an investment in Akamai edge securityproducts.The objective of the framework is to identify the benefit, flexibility, and riskfactors that affect the investment decision. Forrester took a multistepapproach to evaluate the impact that Akamai edge security products forcan have on the broadcasting/OTT Organization:The TEI methodologyhelps companiesdemonstrate, justify,and realize thetangible value of ITinitiatives to bothsenior managementand other keybusinessstakeholders.DUE DILIGENCEInterviewed Akamai stakeholders and Forrester analysts to gatherdata relative to edge security products for broadcasting and OTTcustomers.CUSTOMER INTERVIEWS AND SURVEYInterviewed or surveyed over 30 broadcasting and OTT enterprisecustomers using Akamai edge security products to obtain data withrespect to benefits risks and flexibility.COMPOSITE ORGANIZATIONDesigned a composite Organization based on characteristics of theinterviewed and surveyed customers.FINANCIAL MODEL FRAMEWORKConstructed a financial model representative of the interviewsusing the TEI methodology and risk-adjusted the financial modelbased on issues and concerns of the interviewed organizations.CASE STUDYEmployed three fundamental elements of TEI in modeling Akamaiedge security products for broadcasting and OTT customers:benefits, risks and flexibility. Given the increasing sophisticationthat enterprises have regarding benefit analyses related to ITinvestments, Forrester’s TEI methodology serves to provide apicture of the total economic impact of purchase decisions. Pleasesee Appendix A for additional information on the TEI methodology.DISCLOSURESReaders should be aware of the following:This study is commissioned by Akamai and delivered by Forrester Consulting. Itis not meant to be used as a competitive analysis.Forrester makes no assumptions as to the potential benefits that otherorganizations will receive. Forrester strongly advises that readers use their ownestimates within the framework provided in the report to determine theappropriateness of an investment in Akamai edge security products forbroadcasting/OTT customers.Akamai reviewed and provided feedback to Forrester, but Forrester maintainseditorial control over the study and its findings and does not accept changes tothe study that contradict Forrester’s findings or obscure the meaning of thestudy.Akamai provided the customer names for the interviews and survey but did notparticipate in the interviews.3 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
Akamai’s Edge Security Products ForBroadcasting And OTT Customers — ACustomer JourneyBEFORE AND AFTER AKAMAI’S PRODUCTS FOR BROADCASTING ANDOTT CUSTOMERSInterviewed And Surveyed CustomersFor this study, Forrester conducted several live interviews and surveyed30 Akamai edge security customers. Interviewed and surveyedcustomers were from North America, EMEA, and APAC and included thefollowing attributes:› Enterprise-sized and global broadcasting, over-the-top media, orinternet/social video organizations. Average annual revenue is 1.5billion.› Each customer has used at least two of the following Akamai edgesecurity products for more than six months: KSD, Prolexic, BotManager, EAA, and ETP.“Using Akamai edge securityproducts has helped usprovide consistent service tocustomers, even during anattack.”83% of surveyed customers› Seventy-seven percent of surveyed customers use Akamai’s ContentDelivery Network (CDN) for image delivery, streamed or downloadedvideo, website delivery, and API traffic.› Prior to Akamai, customers were using either third-party solutions or amix of third-party and homegrown security solutions.Key Challenges And GoalsThe interviewed and surveyed customers had the following challengesand goals they were hoping to satisfy with an investment in Akamai edgesecurity products:› To reduce application downtime (and increase application uptime)during malicious attacks.› To protect intellectual property from data breaches.› To simplify and reduce the cost of their IT security environment.› To protect their brand reputations.Composite OrganizationBased on the interviews, Forrester constructed a TEI framework, acomposite company, and an associated benefit analysis that illustratesthe areas financially affected. The composite Organization isrepresentative of the 30 companies that Forrester interviewed orsurveyed and is used to present the aggregate financial analysis in thenext section. The composite Organization that Forrester synthesizedfrom the customer interviews has the following characteristics:› The Organization is a global, enterprise-sized broadcasting, over-thetop media, or internet/social video company with annual revenues ofabout 1.5 billion.4 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
› The Organization uses the following Akamai edge security products:KSD, Prolexic, Bot Manager, EAA, and ETP.› An average of 248 applications are protected by Akamai edge securityproducts.› The Organization uses Akamai’s Content Delivery Network for imagedelivery, streamed or downloaded video, website delivery, and APItraffic.Key ResultsCustomer interviews and surveys revealed the following quantifiedbenefits from an investment in Akamai’s products for broadcasting andOTT customers:“If Akamai’s capabilities were tobe maintained in-house, wewould have to hire, train, andretain substantial andexpensive security resources.We find that it’s more costeffective to use Akamai’sproducts than attempt to hireand retain scarce securitytalent.”Head of security and compliance› Cost savings — fewer FTEs needed to support Akamai edgesecurity products. Compared to its pre-Akamai security environment,the Organization saves 2.5 security administrator FTEs in Year 1 (rampyear) and 3.5 FTEs in Years 2 and 3.› Incremental revenue (gross profit). Akamai helps the Organizationreduce lost revenue and resulting gross profit by 5%.› Reduced spending on hardware. The Organization would havecontinued to invest in on-premises security infrastructure such asstorage, servers, operating system licenses, and annual maintenanceto maintain its legacy security products that were subsequentlyreplaced by Akamai’s edge security products.“Using Akamai edge securityproducts has improvedcustomer satisfaction.”100% of surveyed customers› Savings from decommissioning legacy security products. With itsinvestment in Akamai edge security products, the Organizationdecommissions the following legacy security products: DDoS, botmanagement solution, VPN services, and virtual desktop softwaresubscriptions.5 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
Analysis Of BenefitsQUANTIFIED BENEFIT DATA AS APPLIED TO THE COMPOSITETotal BenefitsYEAR 1YEAR 2YEAR 3TOTALPRESENTVALUE 337,500 472,500 472,500 1,282,500 1,052,310 3,000,000 3,000,000 3,000,000 9,000,000 7,460,556Reduced spending on hardware 60,000 60,000 60,000 180,000 149,211Savings from decommissioninglegacy security products 50,400 50,400 50,400 151,200 125,337 3,447,900 3,582,900 3,582,900 10,613,700 8,787,414REF.BENEFITAtrCost savings — fewer FTEs tosupport edge securityBtrIncremental revenue (gross profit)associated with AkamaiCtrDtrTotal benefits (risk-adjusted)Benefit 1: Cost Savings — Fewer FTEs To SupportEdge SecurityThe Organization has invested in the full suite of Akamai’s edge securityproducts, including KSD, Prolexic, Bot Manager, ETP, and EAA.Compared to its pre-Akamai security environment, it can now save 2.5security administrator FTEs in Year 1 (ramp year) and 3.5 FTEs in Years2 and 3. Interviewed and surveyed customers reported:The table above shows the total of allbenefits across the areas listed below,as well as present values (PVs)discounted at 10%. Over three years,the composite organization expectsrisk-adjusted total benefits to be a PVof nearly 8.8 million.› A 26.5% reduction in the hours to recover from an attack with Akamai(309 hours before Akamai; 227 hours with Akamai).› A 65% reduction in the number of data breaches and a 27% reductionin the labor cost for remediating a data breach.› A 15% savings in time spent researching and adjusting rule changeswith Akamai edge security products.› Improved ability to protect a broad range of applications from DDoSattacks.› Labor savings from no longer having to manage multiple appliances.They manage the configuration in one place, then push it out to allAkamai servers. There’s also a reduction in risk in terms of getting thepolicies correct for multiple appliances.› Labor savings in the reduced volume of attack traffic that Akamaistops, including a reduction in successful attacks to web applications.› Akamai takes care of all the due diligence related to keeping theOrganization’s web application firewall (WAF) rules up to date.Risks. Most interviewed and surveyed customers were not yet using thefull complement of Akamai edge security products discussed in this casestudy and therefore reported reduced and variable FTE labor savings.To account for these variations, Forrester adjusted this benefit downwardby 10%, yielding a three-year risk-adjusted total PV of 1,052,310.Impact risk is the risk that the businessor technology needs of theorganization may not be met by theinvestment, resulting in lower overalltotal benefits. The greater theuncertainty, the wider the potentialrange of outcomes for benefitestimates.6 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
Cost Savings — Fewer FTEs To Support Edge Security: Calculation TableREF.METRICCALC.A1Before Akamai — security FTEs requiredInterviews999A2With Akamai — security FTEs requiredInterviews6.55.55.5A3With Akamai — FTEs savedA1 - A22.53.53.5A4Average fully loaded cost — security FTEIndustry average 150,000 150,000 150,000AtCost savings — fewer FTEs to support edgesecurityA3 * A4 375,000 525,000 525,000Risk adjustment 10% 337,500 472,500 472,500AtrCost savings — fewer FTEs to support edgesecurity (risk-adjusted)YEAR 1YEAR 2YEAR 3Benefit 2: Incremental Revenue (Gross Profit)Associated With AkamaiDigital broadcasting and OTT businesses depend on constant,uninterrupted connectivity for the benefit of their customers. Websites,applications, and cloud services are potential targets for DDoS and otherattacks, which can significantly harm or even cripple digital businesses.Interviewed and surveyed customers reported the following benefits ofAkamai products, which contribute to incremental revenue:› Reduced web fraud from bots that engage in credential stuffing,fraudulent free trials and coupons, and other malicious activity.› Improved web performance by blocking, delaying, or redirectingmalicious bots.› Protecting their organizations’ intellectual property by redirection ofbots intending to scrape their websites.“I feel very confident inAkamai’s ability to protect ourvaluable data from attacks.Akamai is our front door to allissues and our first line ofdefense providing protection,and across our cloudcomputing platform also.”Head of security and compliance› Reduced lost web traffic by 7.3%.› Reduced lost views by 10%.› Reduced lost revenue and resulting gross profit by 5%.Prior to its investment in Akamai, the Organization was losing revenuedue to inadequate edge security. Akamai helps the Organization avoidlosing 5% of its revenue and therefore 5% of its resulting gross profit.The 7,460,556 quantified benefit is the gross profit associated withavoiding the loss of revenue. Forrester estimates the gross profit marginto be 80% in the broadcasting and OTT industry.Risk. The interviewed and surveyed customers had wide ranging totalbroadcasting revenues and different revenue results.To account for these variations, Forrester risk-adjusted this benefitdownward by 25%, yielding a three-year risk-adjusted total PV of 7,460,556.7 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers
Incremental Revenue (Gross Profit) Associated With Akamai: Calculation TableREF.METRICCALC.YEAR 1B1Estimated lost revenueInterviews 100,000,000 100,000,000 100,000,000B2Reduction in lost revenue (by 5%)B1 * 5% 5,000,000 5,000,000 5,000,000BtIncremental revenue (gross profit)associated with AkamaiB2 * 80% 4,000,000 4,000,000 4,000,000Risk adjustment 25% 3,000,000 3,000,000 3,000,000BtrIncremental revenue (gross profit)associated with Akamai (risk-adjusted)YEAR 2YEAR 3Benefit 3: Reduced Spending On HardwareInterviewed customers shared their experiences with no longer needingon-premises infrastructure platforms for security products, data,computational power, and engineering services. Forrester assumes theOrganization would have needed to spend 75,000 annually on updatingsecurity infrastructure such as storage, servers, operating systemlicenses, and annual maintenance to maintain its on-premises legacysecurity products that were subsequently replaced by Akamai’s edgesecurity products.“Using Akamai edge securityproducts has helped usreduced churn rates anddecrease bounce rates.”83% of surveyed customersOn average, the interviewed customers were saving 75,000 annually onhardware infrastructure for legacy securit
5 The Total Economic Impact Of Akamai Edge Security Products For Broadcasting And OTT Customers › The Organization uses the following Akamai edge security products: KSD, Prolexic, Bot Manager, EAA, and ETP. › An average of 248 applications are protected by Akamai
