VeriSign today announced a major new product initiative and its first customer for that new product. The company is leveraging its acquisition earlier this year of Kontiki to launch the VeriSign Intelligent Content Delivery Network, which will be used initially by AxiomTV, an Internet TV channel designed to be family-friendly and parent-controlled.

VeriSign’s CDN packages Kontiki’s peer-to-peer technology, already in use by AOL, BBC, Channel 4 and SkyTV, with content delivery capabilities including security and reliability in a way that officials believe will change the economics of content delivery platforms. The new system is designed for both small and large content providers, including telecom service providers launching IPTV content.

“One of the things we’ve learned through the process of working with AOL on In2TV and our other large media and entertainment customers was that each of them has built their own infrastructure, which included a standard content delivery network they use for streaming and client list downloads, and then they have Kontiki peer-to-peer for large file delivery for video streams of over two to three minutes,” said Todd Johnson, former president of Kontiki and now vice president for broadband content services at VeriSign. “Based on that and the fact that VeriSign has this significant global Internet footprint--it was a perfect marriage to take that footprint and bring a standard CDN on top of that infrastructure and layer on the Kontiki peer-to-peer system.”

The VeriSign CDN will enable service providers to manage broad distribution of content, while protecting digital rights management and guaranteeing quality of the video distributed, Johnson said. The company is taking on current content delivery heavyweights such as Akamai and Limelight Networks, he admitted, but doesn’t have to be concerned about cannibalizing an existing revenue base with newer CDN services.

“They don’t have peer-to-peer technology with the publishing controls and security that Kontiki has, and their whole economic model built on driving significant volume through big video sites,” he said. “Reducing that revenue by 40% using peer-to-peer isn’t that attractive to them. We have the infrastructure because we use it to run SSL, DNS, and global management security business, so we have a lot of other product offers, but we don’t have CDN revenue to cannibalize.”

The VeriSign product is available immediately, and Johnson said the company is already in discussion with large service providers on how content delivery via a PC platform can be used in conjunction and to augment IPTV.

“A lot of these players have much higher broadband penetration than they have IPTV penetration right now,” he said. “This is a way to offer a service that grabs a much bigger audience. They can negotiate and use through IP delivery a broader product set.”

As technology such as Hewlett-Packard’s Smart TV and other TV-Internet integration comes onto the market, content delivery systems that can handle both shorter and longer program formats become more valuable, he said.

AxiomTV, the first customer for VeriSign, offers an Internet site with movies edited to be family-friendly, as well as parental control of what can be viewed.