A Yankee Group analyst is now predicting that more carriers will be jumping into the CDN space by buying existing CDNs. As I posted once before, I don't think there is that big a hubbub here. Certainly there are carriers sniffing around, and I do agree that Verizon or British Telecom might join the fray.
However, if Verizon were going to buy a CDN, I think they would have done so by now. One complication is the fact that Verizon's rates for IP Transit in major datacenters are generally amongst the highest out there - which is another way of saying they aren't very competitive in that market (as opposed to the corporate services and residential markets). It is therefore a bit hard for me to see them hit the same market with a CDN product aggressively. Likewise, BT isn't really a force in wholesale IP transit outside the UK, and most of their network in the USA and even much of continental Europe is leased wavelengths and such. AT&T and Level 3's behavior and focus seem more consistent with a CDN business than either Verizon or BT.
One thought that occurs to me, however, is that Cogent might be a buyer of a smaller CDN. Cogent likes to be the price leader on IP transit but has been facing pricing pressure lately. And since much of future internet growth seems likely to go through CDNs and not through someone like Cogent, it makes sense for them to make some sort of move here. As a very recent addition to the Tier 1 network cartel, Cogent might be able to use that muscle much the way Level 3 intends to. Of course, if history is any guide, Cogent + CDN = a vicious new price war, so perhaps I had better hope that thought stays hypothetical.
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