Cbeyond (CBEY)

Our customer churn rate may increase.

Customer churn occurs when a customer discontinues service with us, whether due to going out of business or switching to a competitor. Changes in the economy, increased competition from other providers, or issues with the quality of service we deliver can impact our customer churn rate. We cannot predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to an increase in customer churn. We historically maintained monthly churn rates of approximately 1.0%. Beginning with the third quarter of 2007, however, we have experienced elevated churn rates that we believe are attributable primarily to the inability of certain of our customers to meet their payment obligations as a result of deteriorating economic conditions. We experienced an average monthly churn rate of 1.3% in 2008 compared to 1.1% in 2007. We cannot predict the duration or magnitude of the currently deteriorated economic conditions. We expect our average monthly churn rate to continue to be greater than 1.0%

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for at least as long as the current economic environment persists. Higher customer churn rates could adversely impact our revenue growth. A sustained and significant growth in the churn rate could have a material adverse effect on our business.

Our customer churn rate may increase.

FACE="Times New Roman" SIZE="2">Customer churn occurs when a customer discontinues service with us, whether due to going out of business or switching to a competitor. Changes in the economy, increased competition from other providers, or issues with
the quality of service we deliver can impact our customer churn rate. We cannot predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to
an increase in customer churn. We historically maintained monthly churn rates of approximately 1.0%. Beginning with the third quarter of 2007, however, we have experienced elevated churn rates that we believe are attributable primarily to the
inability of certain of our customers to meet their payment obligations as a result of deteriorating economic conditions. We experienced an average monthly churn rate of 1.3% in 2008 compared to 1.1% in 2007. We cannot predict the duration or
magnitude of the currently deteriorated economic conditions. We expect our average monthly churn rate to continue to be greater than 1.0%

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for at least as long as the current economic environment persists. Higher customer churn rates could adversely impact our revenue growth. A sustained and
significant growth in the churn rate could have a material adverse effect on our business.

Our customer churn rate may increase.

Customer churn occurs when a customer discontinues their service with us, whether due to going out of business or switching to a competitor. Changes in the economy, as well as increased competition from other providers, can both impact our customer churn rate. We cannot predict general economic conditions. Nor can we predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to an increase in customer churn. We historically maintained monthly churn rates of approximately 1.0%. Beginning with the third quarter of 2007, however, we have experienced elevated churn rates that we believe are attributable primarily to the inability of certain of our customers to meet their payment obligations as a result of deteriorating economic conditions. We experienced average monthly churn rates of 1.1% in the third quarter of 2007, 1.4% in the fourth quarter of 2007, and 1.3% in the first, second, and third quarters of 2008. We cannot predict the future duration or magnitude of the currently deteriorated economic conditions. We expect our churn rate to continue to be elevated above our historical average monthly rate of 1.0% as long as the current economic environment persists. Higher customer churn rates could adversely impact our revenue growth. A sustained and significant growth in the churn rate could have a material adverse effect on our business.

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Our customer churn rate may increase.

Customer churn occurs when a customer discontinues their service with us, whether due to going out of business or switching to a competitor. Changes in the economy, as well as increased competition from other providers, can both impact our customer churn rate. We cannot predict general economic conditions. Nor can we predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to an increase in customer churn. Although our customer churn rate was approximately 1.0% per month for the years ended December 31, 2005 and 2006 and also for the first half of 2007, our churn has recently increased to 1.1% in the third quarter of 2007 and to 1.4% in the fourth quarter of 2007. We believe this elevated churn is due to general economic factors. We also believe churn will continue to be elevated through at least the first quarter of 2008. While we believe churn may be reduced in future periods, there is no assurance that this will occur, as we cannot predict the effects or duration of the current economic downturn. Higher customer churn rates could adversely impact our revenue growth. A sustained and significant growth in the churn rate could have a material adverse effect on our business.

Our customer churn rate may increase.

Although our customer churn rate was approximately 1% per month for 2004, 2005 and 2006, we cannot assure that we will be able to maintain this rate in the future. Customer churn occurs when a customer switches to one of our competitors or when a customer discontinues its business altogether. Changes in the economy, as well as increased competition from other providers, can both impact our customer churn rate. We cannot predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to an increase in customer churn. In addition, our historical customer churn rates may not be indicative of future rates because the initial term for many of our customer contracts (based on customer location) has not yet expired. As of December 31, 2006, approximately 19% of our existing customer contracts will expire in 2007 and approximately 16% of our customers are on month to month contracts, which take effect automatically upon the expiration of our three year contracts unless otherwise extended.

Our customer churn rate may increase.

Although our customer churn rate was approximately 1% per month for 2003, 2004 and 2005, we cannot assure you that we will be able to maintain this rate in the future. Customer churn occurs when a customer switches to one of our competitors or when a customer discontinues its business altogether. Changes in the economy, as well as increased competition from other providers, can both impact our customer churn rate. We cannot predict future pricing by our competitors, but we anticipate that aggressive price competition will continue. Lower prices offered by our competitors could contribute to an increase in customer churn. In addition, our historical customer churn rates may not be indicative of future rates because the initial term for many of our customer contracts has not yet expired. As of December 31, 2005, approximately 22% of our existing customer contracts will expire during 2006.