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No. of Recommendations: 8
Here is my take: It doesn't even matter who got the Shopify deal. Both Fastly and Cloudflare will be fine in the short term and they will keep on growing because this is an important emerging market. At the same time, it shows the potential weakness of the CDN market in general which has been discussed already. CDN in my view is a hardware game, and in the long term, competitors will eat away each other's margins. As such, it doesn't bode well for both of them (in that specific market).

From my understanding Fastly is more exposed to this market. That would make me a bit worried as a shareholder. Cloudflare seems to be in more markets, which is good since they don't rely on CDN so much. On the other hand, it always seemed to me that they lack focus.

Take this with a grain of salt, though, since I never owned any of these companies and lack the knowledge to have a firm opinion. But this is the main reason I never got into these stocks. I struggled to see the strategy towards a durable competitive advantage.

Niki
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