12. Segment Information
|9 Months Ended|
Sep. 30, 2013
|Notes to Financial Statements|
|12. Segment Information||
The Company complies with the accounting and reporting requirements on Disclosures about Segments of an Enterprise and Related Information. The guidance requires disclosures of segment information on the basis that is used internally for evaluating segment performance and for determining the allocation of resources to the operating segments.
The Company has two reportable segments that it operates and manages Carrier Services and Business Services. These segments are organized by the products and services that are sold and the customers that are served. The Company measures and evaluates its reportable segments based on revenues and gross profit margins. The Companys executive, administrative and support costs are allocated to the Companys operating segments and are included in segment income. The Companys segments and their principal activities consist of the following:
Carrier Services includes the termination of carrier traffic utilizing primarily Voice over Internet Protocol (VoIP) technology. VoIP permits a less costly and more rapid interconnection between the Company and international telecommunications carriers, and generally provides better profit margins for the Company than other technologies. The Company currently interconnects with over 270 carrier customers and vendors, and is working to expand its interconnection relationships, particularly with carriers in emerging markets.
The Company provides a full portfolio of cloud communications, cloud connectivity, storage and security solutions to small, medium and large businesses. These services are sold through both the Companys direct sales force and its partner sales program, which utilizes the efforts of independent third-party distributors to sell the Companys products and services. The Business Services segment includes the results of operations of NBS effective as of October 29, 2012.
Operating segment information for the three and nine months ended September 30, 2013 and 2012 is summarized as follows:
Three Months Ended September 30, 2013
Three Months Ended September 30, 2012
Nine Months Ended September 30, 2013
Nine Months Ended September 30, 2012
The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.
Reference 1: http://www.xbrl.org/2003/role/presentationRef