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These excerpts taken from the NSR 10-K filed Mar 2, 2009. Contracts
We provide many of our addressing, interoperability and
infrastructure services pursuant to private commercial and
government contracts. Specifically, in the United States, we
provide wireline and wireless number portability, implement the
allocation of pooled blocks of telephone numbers and provide
network management services pursuant to seven regional contracts
with North American Portability Management LLC, an industry
group that represents all telecommunications service providers
in the United States. Although the FCC has plenary authority
over the administration of telephone number portability, it is
not a party to our contracts with North American Portability
Management LLC. The North American Numbering Council, a federal
advisory committee to which the FCC has delegated limited
oversight responsibilities, reviews and oversees North American
Portability Management LLC’s management of these contracts.
See “— Regulatory
Environment — Telephone Numbering.” We
recognized revenue under our contracts with North American
Portability Management LLC primarily on a per transaction basis
through December 31, 2008, and the aggregate fees for
transactions processed under these contracts were determined by
the total number of transactions. As of January 1, 2009, we
are paid on an annual, fixed-fee basis, subject to a
contractually established, annual 6.5% escalator. Under this
fixed-fee model, fixed credits are used to calculate the annual
fixed fee in 2009, 2010 and 2011. In addition, our customers may
earn additional credits annually in 2009, 2010 and 2011 if
certain levels of aggregate telephone number inventories are
reached and if certain IP fields and functionality are adopted
and implemented. Moreover, in the event that the volume of
transactions in a given year is above or below the contractually
established volume range for that year, the fixed-fee may be
adjusted up or down, respectively, with any such adjustment
being applied in the following year. Under both the
transaction-based and fixed-fee models, our fees are billed to
telecommunications service providers based on their allocable
share of the total transaction charges. This allocable share is
based on each respective telecommunications service
provider’s share of the aggregate end-user services
revenues of all U.S. telecommunications service providers
as determined by the FCC. Under these contracts, we also bill a
revenue recovery collections, or RRC, fee of a percentage of
monthly billings to our customers, which is available to us if
any telecommunications service provider fails to pay its
allocable share of total transaction charges. If the RRC fee is
insufficient for that purpose, these contracts also provide for
the recovery of such differences from the remaining
telecommunications service providers. Under these contracts,
users of our clearinghouse also pay fees to connect to our data
center and additional fees for reports that we generate at the
user’s request. Our contracts with North American
Portability Management LLC continue through June 2015.
On November 3, 2005, BellSouth Corporation filed a petition
seeking changes in the way our customers are billed for services
provided by us under our contracts with North American
Portability Management LLC. In response to the BellSouth
petition, the FCC requested comments from interested parties. As
of February 17, 2009, the FCC had not initiated a formal
rulemaking process, and the BellSouth petition remains pending.
In addition, after the amendment of our contracts with North
American Portability Management LLC in September 2006, Telcordia
Technologies, Inc. filed a petition with the FCC requesting an
order that would require North American Portability Management
LLC to conduct a new bidding process to appoint a provider of
telephone number portability services in the United States,
which Telcordia has continued to pursue in response to our
amendment of these contracts in January 2009. As of
February 17, 2009, the FCC had not initiated a formal
rulemaking process,
Table of Contents
and the Telcordia petition remains pending. If the Telcordia
petition is successful, we may lose one or more of our contracts
with North American Portability LLC or lose a portion of our
business in one or more geographic regions where we provide
services.
We also provide wireline and wireless number portability and
network management services in Canada pursuant to a contract
with the Canadian LNP Consortium Inc., a private corporation
composed of telecommunications service providers who participate
in number portability in Canada. The Canadian Radio-television
and Telecommunications Commission oversees the Canadian LNP
Consortium’s management of this contract. We bill each
telecommunications service provider for our services under this
contract primarily on a per transaction basis. This contract
continues through December 2011. The services we provide under
the contracts with North American Portability Management LLC and
the Canadian LNP Consortium are subject to rigorous performance
standards, and we are subject to corresponding penalties for
failure to meet those standards.
We serve as the North American Numbering Plan Administrator and
the National Pooling Administrator pursuant to two separate
contracts with the FCC. Under these contracts, we administer the
assignment and implementation of new area codes in North
America, the allocation of central office codes (which are the
prefixes following the area codes) to telecommunications service
providers in the United States, and the assignment and
allocation of pooled blocks of telephone numbers in the United
States in a manner designed to conserve telephone number
resources. The North American Numbering Plan Administration
contract is a fixed-fee government contract that was awarded by
the FCC in 2003. The contract is structured as a one-year
agreement with four one-year options exercisable by the FCC. The
FCC has exercised each of these four options, and this contract
expired on July 8, 2008. The FCC extended the contract
through July 2009 to begin the bidding process and we expect to
compete for a renewal of this contract. The National Pooling
Administration contract was originally awarded to us by the FCC
in 2001. In August 2007, the FCC awarded us a new contract to
continue as the National Pooling Administrator. Under this
contract, we perform the administrative functions associated
with the allocation of pooled blocks of telephone numbers in the
United States. The terms of this contract provide for a fixed
fee associated with the administration of the pooling system
plus reimbursement of select costs. The initial contract term is
two years, commencing in August 2007, and provides three
one-year extension options that are exercisable at the election
of the FCC.
We are the operator of the .biz Internet top-level domain by
contract with the Internet Corporation for Assigned Names and
Numbers, or ICANN. The .biz contract was originally granted in
May 2001. In December 2006, the ICANN awarded to us a renewal of
the .biz contract through December 2012. Under the terms of the
amended agreement, the .biz contract automatically renews after
2012 unless it has been determined that we have been in
fundamental and material breach of certain provisions of the
agreement and have failed to cure such breach. Similarly,
pursuant to a contract with the U.S. Department of
Commerce, we operate the .us Internet domain registry. This
contract was originally awarded in October 2001. In October
2007, the government awarded to us a renewal of the .us contract
for a period of three years, which may be extended by the
government for two additional one-year periods. In response to a
bid protest filed by one of our competitors, the Department of
Commerce evaluated the procedures it followed in awarding to us
the .us contract. Pending resolution of this evaluation,
performance under our new .us contract was stayed, and the terms
of our previous .us contract remained in effect. The evaluation
was completed in August 2008 and the terms of the new .us
contract were amended. The amended contract expires in October
2011, with two one-year renewal options exercisable by the
Department of Commerce. The .biz and .us contracts allow us to
provide domain name registration services to domain name
registrars, who pay us on a per-name basis.
We have an exclusive contract with the CTIA — The
Wireless
Association®
to serve as the registry operator for the administration of
U.S. Common Short Codes. U.S. Common Short Codes are
short strings of numbers to which text messages can be
addressed — a common addressing scheme that works
across all participating wireless networks. We were awarded this
contract in October 2003 through an open procurement process by
the major wireless carriers. In June 2008, the contract was
amended to include a term through December 2015. We provide
U.S. Common Short Code registration services to wireless
content providers, who pay us subscription fees per
U.S. Common Short Code registered.
Table of Contents
Contracts
We provide many of our addressing, interoperability and
infrastructure services pursuant to private commercial and
government contracts. Specifically, in the United States, we
provide wireline and wireless number portability, implement the
allocation of pooled blocks of telephone numbers and provide
network management services pursuant to seven regional contracts
with North American Portability Management LLC, an industry
group that represents all telecommunications service providers
in the United States. Although the FCC has plenary authority
over the administration of telephone number portability, it is
not a party to our contracts with North American Portability
Management LLC. The North American Numbering Council, a federal
advisory committee to which the FCC has delegated limited
oversight responsibilities, reviews and oversees North American
Portability Management LLC’s management of these contracts.
See “— Regulatory
Environment — Telephone Numbering.” We
recognized revenue under our contracts with North American
Portability Management LLC primarily on a per transaction basis
through December 31, 2008, and the aggregate fees for
transactions processed under these contracts were determined by
the total number of transactions. As of January 1, 2009, we
are paid on an annual, fixed-fee basis, subject to a
contractually established, annual 6.5% escalator. Under this
fixed-fee model, fixed credits are used to calculate the annual
fixed fee in 2009, 2010 and 2011. In addition, our customers may
earn additional credits annually in 2009, 2010 and 2011 if
certain levels of aggregate telephone number inventories are
reached and if certain IP fields and functionality are adopted
and implemented. Moreover, in the event that the volume of
transactions in a given year is above or below the contractually
established volume range for that year, the fixed-fee may be
adjusted up or down, respectively, with any such adjustment
being applied in the following year. Under both the
transaction-based and fixed-fee models, our fees are billed to
telecommunications service providers based on their allocable
share of the total transaction charges. This allocable share is
based on each respective telecommunications service
provider’s share of the aggregate end-user services
revenues of all U.S. telecommunications service providers
as determined by the FCC. Under these contracts, we also bill a
revenue recovery collections, or RRC, fee of a percentage of
monthly billings to our customers, which is available to us if
any telecommunications service provider fails to pay its
allocable share of total transaction charges. If the RRC fee is
insufficient for that purpose, these contracts also provide for
the recovery of such differences from the remaining
telecommunications service providers. Under these contracts,
users of our clearinghouse also pay fees to connect to our data
center and additional fees for reports that we generate at the
user’s request. Our contracts with North American
Portability Management LLC continue through June 2015.
On November 3, 2005, BellSouth Corporation filed a petition
seeking changes in the way our customers are billed for services
provided by us under our contracts with North American
Portability Management LLC. In response to the BellSouth
petition, the FCC requested comments from interested parties. As
of February 17, 2009, the FCC had not initiated a formal
rulemaking process, and the BellSouth petition remains pending.
In addition, after the amendment of our contracts with North
American Portability Management LLC in September 2006, Telcordia
Technologies, Inc. filed a petition with the FCC requesting an
order that would require North American Portability Management
LLC to conduct a new bidding process to appoint a provider of
telephone number portability services in the United States,
which Telcordia has continued to pursue in response to our
amendment of these contracts in January 2009. As of
February 17, 2009, the FCC had not initiated a formal
rulemaking process,
Table of Contents
and the Telcordia petition remains pending. If the Telcordia
petition is successful, we may lose one or more of our contracts
with North American Portability LLC or lose a portion of our
business in one or more geographic regions where we provide
services.
We also provide wireline and wireless number portability and
network management services in Canada pursuant to a contract
with the Canadian LNP Consortium Inc., a private corporation
composed of telecommunications service providers who participate
in number portability in Canada. The Canadian Radio-television
and Telecommunications Commission oversees the Canadian LNP
Consortium’s management of this contract. We bill each
telecommunications service provider for our services under this
contract primarily on a per transaction basis. This contract
continues through December 2011. The services we provide under
the contracts with North American Portability Management LLC and
the Canadian LNP Consortium are subject to rigorous performance
standards, and we are subject to corresponding penalties for
failure to meet those standards.
We serve as the North American Numbering Plan Administrator and
the National Pooling Administrator pursuant to two separate
contracts with the FCC. Under these contracts, we administer the
assignment and implementation of new area codes in North
America, the allocation of central office codes (which are the
prefixes following the area codes) to telecommunications service
providers in the United States, and the assignment and
allocation of pooled blocks of telephone numbers in the United
States in a manner designed to conserve telephone number
resources. The North American Numbering Plan Administration
contract is a fixed-fee government contract that was awarded by
the FCC in 2003. The contract is structured as a one-year
agreement with four one-year options exercisable by the FCC. The
FCC has exercised each of these four options, and this contract
expired on July 8, 2008. The FCC extended the contract
through July 2009 to begin the bidding process and we expect to
compete for a renewal of this contract. The National Pooling
Administration contract was originally awarded to us by the FCC
in 2001. In August 2007, the FCC awarded us a new contract to
continue as the National Pooling Administrator. Under this
contract, we perform the administrative functions associated
with the allocation of pooled blocks of telephone numbers in the
United States. The terms of this contract provide for a fixed
fee associated with the administration of the pooling system
plus reimbursement of select costs. The initial contract term is
two years, commencing in August 2007, and provides three
one-year extension options that are exercisable at the election
of the FCC.
We are the operator of the .biz Internet top-level domain by
contract with the Internet Corporation for Assigned Names and
Numbers, or ICANN. The .biz contract was originally granted in
May 2001. In December 2006, the ICANN awarded to us a renewal of
the .biz contract through December 2012. Under the terms of the
amended agreement, the .biz contract automatically renews after
2012 unless it has been determined that we have been in
fundamental and material breach of certain provisions of the
agreement and have failed to cure such breach. Similarly,
pursuant to a contract with the U.S. Department of
Commerce, we operate the .us Internet domain registry. This
contract was originally awarded in October 2001. In October
2007, the government awarded to us a renewal of the .us contract
for a period of three years, which may be extended by the
government for two additional one-year periods. In response to a
bid protest filed by one of our competitors, the Department of
Commerce evaluated the procedures it followed in awarding to us
the .us contract. Pending resolution of this evaluation,
performance under our new .us contract was stayed, and the terms
of our previous .us contract remained in effect. The evaluation
was completed in August 2008 and the terms of the new .us
contract were amended. The amended contract expires in October
2011, with two one-year renewal options exercisable by the
Department of Commerce. The .biz and .us contracts allow us to
provide domain name registration services to domain name
registrars, who pay us on a per-name basis.
We have an exclusive contract with the CTIA — The
Wireless
Association®
to serve as the registry operator for the administration of
U.S. Common Short Codes. U.S. Common Short Codes are
short strings of numbers to which text messages can be
addressed — a common addressing scheme that works
across all participating wireless networks. We were awarded this
contract in October 2003 through an open procurement process by
the major wireless carriers. In June 2008, the contract was
amended to include a term through December 2015. We provide
U.S. Common Short Code registration services to wireless
content providers, who pay us subscription fees per
U.S. Common Short Code registered.
Table of Contents
Contracts We provide many of our addressing, interoperability and infrastructure services pursuant to private commercial and government contracts. Specifically, in the United States, we provide wireline and wireless number portability, implement the allocation of pooled blocks of telephone numbers and provide network management services pursuant to seven regional contracts with North American Portability Management LLC, an industry group that represents all telecommunications service providers in the United States. Although the FCC has plenary authority over the administration of telephone number portability, it is not a party to our contracts with North American Portability Management LLC. The North American Numbering Council, a federal advisory committee to which the FCC has delegated limited oversight responsibilities, reviews and oversees North American Portability Management LLC’s management of these contracts. See “— Regulatory Environment — Telephone Numbering.” We recognized revenue under our contracts with North American Portability Management LLC primarily on a per transaction basis through December 31, 2008, and the aggregate fees for transactions processed under these contracts were determined by the total number of transactions. As of January 1, 2009, we are paid on an annual, fixed-fee basis, subject to a contractually established, annual 6.5% escalator. Under this fixed-fee model, fixed credits are used to calculate the annual fixed fee in 2009, 2010 and 2011. In addition, our customers may earn additional credits annually in 2009, 2010 and 2011 if certain levels of aggregate telephone number inventories are reached and if certain IP fields and functionality are adopted and implemented. Moreover, in the event that the volume of transactions in a given year is above or below the contractually established volume range for that year, the fixed-fee may be adjusted up or down, respectively, with any such adjustment being applied in the following year. Under both the transaction-based and fixed-fee models, our fees are billed to telecommunications service providers based on their allocable share of the total transaction charges. This allocable share is based on each respective telecommunications service provider’s share of the aggregate end-user services revenues of all U.S. telecommunications service providers as determined by the FCC. Under these contracts, we also bill a revenue recovery collections, or RRC, fee of a percentage of monthly billings to our customers, which is available to us if any telecommunications service provider fails to pay its allocable share of total transaction charges. If the RRC fee is insufficient for that purpose, these contracts also provide for the recovery of such differences from the remaining telecommunications service providers. Under these contracts, users of our clearinghouse also pay fees to connect to our data center and additional fees for reports that we generate at the user’s request. Our contracts with North American Portability Management LLC continue through June 2015. On November 3, 2005, BellSouth Corporation filed a petition seeking changes in the way our customers are billed for services provided by us under our contracts with North American Portability Management LLC. In response to the BellSouth petition, the FCC requested comments from interested parties. As of February 17, 2009, the FCC had not initiated a formal rulemaking process, and the BellSouth petition remains pending. In addition, after the amendment of our contracts with North American Portability Management LLC in September 2006, Telcordia Technologies, Inc. filed a petition with the FCC requesting an order that would require North American Portability Management LLC to conduct a new bidding process to appoint a provider of telephone number portability services in the United States, which Telcordia has continued to pursue in response to our amendment of these contracts in January 2009. As of February 17, 2009, the FCC had not initiated a formal rulemaking process,
Table of Contentsand the Telcordia petition remains pending. If the Telcordia petition is successful, we may lose one or more of our contracts with North American Portability LLC or lose a portion of our business in one or more geographic regions where we provide services. We also provide wireline and wireless number portability and network management services in Canada pursuant to a contract with the Canadian LNP Consortium Inc., a private corporation composed of telecommunications service providers who participate in number portability in Canada. The Canadian Radio-television and Telecommunications Commission oversees the Canadian LNP Consortium’s management of this contract. We bill each telecommunications service provider for our services under this contract primarily on a per transaction basis. This contract continues through December 2011. The services we provide under the contracts with North American Portability Management LLC and the Canadian LNP Consortium are subject to rigorous performance standards, and we are subject to corresponding penalties for failure to meet those standards. We serve as the North American Numbering Plan Administrator and the National Pooling Administrator pursuant to two separate contracts with the FCC. Under these contracts, we administer the assignment and implementation of new area codes in North America, the allocation of central office codes (which are the prefixes following the area codes) to telecommunications service providers in the United States, and the assignment and allocation of pooled blocks of telephone numbers in the United States in a manner designed to conserve telephone number resources. The North American Numbering Plan Administration contract is a fixed-fee government contract that was awarded by the FCC in 2003. The contract is structured as a one-year agreement with four one-year options exercisable by the FCC. The FCC has exercised each of these four options, and this contract expired on July 8, 2008. The FCC extended the contract through July 2009 to begin the bidding process and we expect to compete for a renewal of this contract. The National Pooling Administration contract was originally awarded to us by the FCC in 2001. In August 2007, the FCC awarded us a new contract to continue as the National Pooling Administrator. Under this contract, we perform the administrative functions associated with the allocation of pooled blocks of telephone numbers in the United States. The terms of this contract provide for a fixed fee associated with the administration of the pooling system plus reimbursement of select costs. The initial contract term is two years, commencing in August 2007, and provides three one-year extension options that are exercisable at the election of the FCC. We are the operator of the .biz Internet top-level domain by contract with the Internet Corporation for Assigned Names and Numbers, or ICANN. The .biz contract was originally granted in May 2001. In December 2006, the ICANN awarded to us a renewal of the .biz contract through December 2012. Under the terms of the amended agreement, the .biz contract automatically renews after 2012 unless it has been determined that we have been in fundamental and material breach of certain provisions of the agreement and have failed to cure such breach. Similarly, pursuant to a contract with the U.S. Department of Commerce, we operate the .us Internet domain registry. This contract was originally awarded in October 2001. In October 2007, the government awarded to us a renewal of the .us contract for a period of three years, which may be extended by the government for two additional one-year periods. In response to a bid protest filed by one of our competitors, the Department of Commerce evaluated the procedures it followed in awarding to us the .us contract. Pending resolution of this evaluation, performance under our new .us contract was stayed, and the terms of our previous .us contract remained in effect. The evaluation was completed in August 2008 and the terms of the new .us contract were amended. The amended contract expires in October 2011, with two one-year renewal options exercisable by the Department of Commerce. The .biz and .us contracts allow us to provide domain name registration services to domain name registrars, who pay us on a per-name basis. We have an exclusive contract with the CTIA — The Wireless Association® to serve as the registry operator for the administration of U.S. Common Short Codes. U.S. Common Short Codes are short strings of numbers to which text messages can be addressed — a common addressing scheme that works across all participating wireless networks. We were awarded this contract in October 2003 through an open procurement process by the major wireless carriers. In June 2008, the contract was amended to include a term through December 2015. We provide U.S. Common Short Code registration services to wireless content providers, who pay us subscription fees per U.S. Common Short Code registered.
Table of ContentsContracts We provide many of our addressing, interoperability and infrastructure services pursuant to private commercial and government contracts. Specifically, in the United States, we provide wireline and wireless number portability, implement the allocation of pooled blocks of telephone numbers and provide network management services pursuant to seven regional contracts with North American Portability Management LLC, an industry group that represents all telecommunications service providers in the United States. Although the FCC has plenary authority over the administration of telephone number portability, it is not a party to our contracts with North American Portability Management LLC. The North American Numbering Council, a federal advisory committee to which the FCC has delegated limited oversight responsibilities, reviews and oversees North American Portability Management LLC’s management of these contracts. See “— Regulatory Environment — Telephone Numbering.” We recognized revenue under our contracts with North American Portability Management LLC primarily on a per transaction basis through December 31, 2008, and the aggregate fees for transactions processed under these contracts were determined by the total number of transactions. As of January 1, 2009, we are paid on an annual, fixed-fee basis, subject to a contractually established, annual 6.5% escalator. Under this fixed-fee model, fixed credits are used to calculate the annual fixed fee in 2009, 2010 and 2011. In addition, our customers may earn additional credits annually in 2009, 2010 and 2011 if certain levels of aggregate telephone number inventories are reached and if certain IP fields and functionality are adopted and implemented. Moreover, in the event that the volume of transactions in a given year is above or below the contractually established volume range for that year, the fixed-fee may be adjusted up or down, respectively, with any such adjustment being applied in the following year. Under both the transaction-based and fixed-fee models, our fees are billed to telecommunications service providers based on their allocable share of the total transaction charges. This allocable share is based on each respective telecommunications service provider’s share of the aggregate end-user services revenues of all U.S. telecommunications service providers as determined by the FCC. Under these contracts, we also bill a revenue recovery collections, or RRC, fee of a percentage of monthly billings to our customers, which is available to us if any telecommunications service provider fails to pay its allocable share of total transaction charges. If the RRC fee is insufficient for that purpose, these contracts also provide for the recovery of such differences from the remaining telecommunications service providers. Under these contracts, users of our clearinghouse also pay fees to connect to our data center and additional fees for reports that we generate at the user’s request. Our contracts with North American Portability Management LLC continue through June 2015. On November 3, 2005, BellSouth Corporation filed a petition seeking changes in the way our customers are billed for services provided by us under our contracts with North American Portability Management LLC. In response to the BellSouth petition, the FCC requested comments from interested parties. As of February 17, 2009, the FCC had not initiated a formal rulemaking process, and the BellSouth petition remains pending. In addition, after the amendment of our contracts with North American Portability Management LLC in September 2006, Telcordia Technologies, Inc. filed a petition with the FCC requesting an order that would require North American Portability Management LLC to conduct a new bidding process to appoint a provider of telephone number portability services in the United States, which Telcordia has continued to pursue in response to our amendment of these contracts in January 2009. As of February 17, 2009, the FCC had not initiated a formal rulemaking process,
Table of Contentsand the Telcordia petition remains pending. If the Telcordia petition is successful, we may lose one or more of our contracts with North American Portability LLC or lose a portion of our business in one or more geographic regions where we provide services. We also provide wireline and wireless number portability and network management services in Canada pursuant to a contract with the Canadian LNP Consortium Inc., a private corporation composed of telecommunications service providers who participate in number portability in Canada. The Canadian Radio-television and Telecommunications Commission oversees the Canadian LNP Consortium’s management of this contract. We bill each telecommunications service provider for our services under this contract primarily on a per transaction basis. This contract continues through December 2011. The services we provide under the contracts with North American Portability Management LLC and the Canadian LNP Consortium are subject to rigorous performance standards, and we are subject to corresponding penalties for failure to meet those standards. We serve as the North American Numbering Plan Administrator and the National Pooling Administrator pursuant to two separate contracts with the FCC. Under these contracts, we administer the assignment and implementation of new area codes in North America, the allocation of central office codes (which are the prefixes following the area codes) to telecommunications service providers in the United States, and the assignment and allocation of pooled blocks of telephone numbers in the United States in a manner designed to conserve telephone number resources. The North American Numbering Plan Administration contract is a fixed-fee government contract that was awarded by the FCC in 2003. The contract is structured as a one-year agreement with four one-year options exercisable by the FCC. The FCC has exercised each of these four options, and this contract expired on July 8, 2008. The FCC extended the contract through July 2009 to begin the bidding process and we expect to compete for a renewal of this contract. The National Pooling Administration contract was originally awarded to us by the FCC in 2001. In August 2007, the FCC awarded us a new contract to continue as the National Pooling Administrator. Under this contract, we perform the administrative functions associated with the allocation of pooled blocks of telephone numbers in the United States. The terms of this contract provide for a fixed fee associated with the administration of the pooling system plus reimbursement of select costs. The initial contract term is two years, commencing in August 2007, and provides three one-year extension options that are exercisable at the election of the FCC. We are the operator of the .biz Internet top-level domain by contract with the Internet Corporation for Assigned Names and Numbers, or ICANN. The .biz contract was originally granted in May 2001. In December 2006, the ICANN awarded to us a renewal of the .biz contract through December 2012. Under the terms of the amended agreement, the .biz contract automatically renews after 2012 unless it has been determined that we have been in fundamental and material breach of certain provisions of the agreement and have failed to cure such breach. Similarly, pursuant to a contract with the U.S. Department of Commerce, we operate the .us Internet domain registry. This contract was originally awarded in October 2001. In October 2007, the government awarded to us a renewal of the .us contract for a period of three years, which may be extended by the government for two additional one-year periods. In response to a bid protest filed by one of our competitors, the Department of Commerce evaluated the procedures it followed in awarding to us the .us contract. Pending resolution of this evaluation, performance under our new .us contract was stayed, and the terms of our previous .us contract remained in effect. The evaluation was completed in August 2008 and the terms of the new .us contract were amended. The amended contract expires in October 2011, with two one-year renewal options exercisable by the Department of Commerce. The .biz and .us contracts allow us to provide domain name registration services to domain name registrars, who pay us on a per-name basis. We have an exclusive contract with the CTIA — The Wireless Association® to serve as the registry operator for the administration of U.S. Common Short Codes. U.S. Common Short Codes are short strings of numbers to which text messages can be addressed — a common addressing scheme that works across all participating wireless networks. We were awarded this contract in October 2003 through an open procurement process by the major wireless carriers. In June 2008, the contract was amended to include a term through December 2015. We provide U.S. Common Short Code registration services to wireless content providers, who pay us subscription fees per U.S. Common Short Code registered.
Table of ContentsContracts We provide many of our addressing, interoperability and infrastructure services pursuant to private commercial and government contracts. Specifically, in the United States, we provide wireline and wireless number portability, implement the allocation of pooled blocks of telephone numbers and provide network management services pursuant to seven regional contracts with North American Portability Management LLC, an industry group that represents all telecommunications service providers in the United States. Although the FCC has plenary authority over the administration of telephone number portability, it is not a party to our contracts with North American Portability Management LLC. The North American Numbering Council, a federal advisory committee to which the FCC has delegated limited oversight responsibilities, reviews and oversees North American Portability Management LLC’s management of these contracts. See “— Regulatory Environment — Telephone Numbering.” We recognized revenue under our contracts with North American Portability Management LLC primarily on a per transaction basis through December 31, 2008, and the aggregate fees for transactions processed under these contracts were determined by the total number of transactions. As of January 1, 2009, we are paid on an annual, fixed-fee basis, subject to a contractually established, annual 6.5% escalator. Under this fixed-fee model, fixed credits are used to calculate the annual fixed fee in 2009, 2010 and 2011. In addition, our customers may earn additional credits annually in 2009, 2010 and 2011 if certain levels of aggregate telephone number inventories are reached and if certain IP fields and functionality are adopted and implemented. Moreover, in the event that the volume of transactions in a given year is above or below the contractually established volume range for that year, the fixed-fee may be adjusted up or down, respectively, with any such adjustment being applied in the following year. Under both the transaction-based and fixed-fee models, our fees are billed to telecommunications service providers based on their allocable share of the total transaction charges. This allocable share is based on each respective telecommunications service provider’s share of the aggregate end-user services revenues of all U.S. telecommunications service providers as determined by the FCC. Under these contracts, we also bill a revenue recovery collections, or RRC, fee of a percentage of monthly billings to our customers, which is available to us if any telecommunications service provider fails to pay its allocable share of total transaction charges. If the RRC fee is insufficient for that purpose, these contracts also provide for the recovery of such differences from the remaining telecommunications service providers. Under these contracts, users of our clearinghouse also pay fees to connect to our data center and additional fees for reports that we generate at the user’s request. Our contracts with North American Portability Management LLC continue through June 2015. On November 3, 2005, BellSouth Corporation filed a petition seeking changes in the way our customers are billed for services provided by us under our contracts with North American Portability Management LLC. In response to the BellSouth petition, the FCC requested comments from interested parties. As of February 17, 2009, the FCC had not initiated a formal rulemaking process, and the BellSouth petition remains pending. In addition, after the amendment of our contracts with North American Portability Management LLC in September 2006, Telcordia Technologies, Inc. filed a petition with the FCC requesting an order that would require North American Portability Management LLC to conduct a new bidding process to appoint a provider of telephone number portability services in the United States, which Telcordia has continued to pursue in response to our amendment of these contracts in January 2009. As of February 17, 2009, the FCC had not initiated a formal rulemaking process,
Table of Contentsand the Telcordia petition remains pending. If the Telcordia petition is successful, we may lose one or more of our contracts with North American Portability LLC or lose a portion of our business in one or more geographic regions where we provide services. We also provide wireline and wireless number portability and network management services in Canada pursuant to a contract with the Canadian LNP Consortium Inc., a private corporation composed of telecommunications service providers who participate in number portability in Canada. The Canadian Radio-television and Telecommunications Commission oversees the Canadian LNP Consortium’s management of this contract. We bill each telecommunications service provider for our services under this contract primarily on a per transaction basis. This contract continues through December 2011. The services we provide under the contracts with North American Portability Management LLC and the Canadian LNP Consortium are subject to rigorous performance standards, and we are subject to corresponding penalties for failure to meet those standards. We serve as the North American Numbering Plan Administrator and the National Pooling Administrator pursuant to two separate contracts with the FCC. Under these contracts, we administer the assignment and implementation of new area codes in North America, the allocation of central office codes (which are the prefixes following the area codes) to telecommunications service providers in the United States, and the assignment and allocation of pooled blocks of telephone numbers in the United States in a manner designed to conserve telephone number resources. The North American Numbering Plan Administration contract is a fixed-fee government contract that was awarded by the FCC in 2003. The contract is structured as a one-year agreement with four one-year options exercisable by the FCC. The FCC has exercised each of these four options, and this contract expired on July 8, 2008. The FCC extended the contract through July 2009 to begin the bidding process and we expect to compete for a renewal of this contract. The National Pooling Administration contract was originally awarded to us by the FCC in 2001. In August 2007, the FCC awarded us a new contract to continue as the National Pooling Administrator. Under this contract, we perform the administrative functions associated with the allocation of pooled blocks of telephone numbers in the United States. The terms of this contract provide for a fixed fee associated with the administration of the pooling system plus reimbursement of select costs. The initial contract term is two years, commencing in August 2007, and provides three one-year extension options that are exercisable at the election of the FCC. We are the operator of the .biz Internet top-level domain by contract with the Internet Corporation for Assigned Names and Numbers, or ICANN. The .biz contract was originally granted in May 2001. In December 2006, the ICANN awarded to us a renewal of the .biz contract through December 2012. Under the terms of the amended agreement, the .biz contract automatically renews after 2012 unless it has been determined that we have been in fundamental and material breach of certain provisions of the agreement and have failed to cure such breach. Similarly, pursuant to a contract with the U.S. Department of Commerce, we operate the .us Internet domain registry. This contract was originally awarded in October 2001. In October 2007, the government awarded to us a renewal of the .us contract for a period of three years, which may be extended by the government for two additional one-year periods. In response to a bid protest filed by one of our competitors, the Department of Commerce evaluated the procedures it followed in awarding to us the .us contract. Pending resolution of this evaluation, performance under our new .us contract was stayed, and the terms of our previous .us contract remained in effect. The evaluation was completed in August 2008 and the terms of the new .us contract were amended. The amended contract expires in October 2011, with two one-year renewal options exercisable by the Department of Commerce. The .biz and .us contracts allow us to provide domain name registration services to domain name registrars, who pay us on a per-name basis. We have an exclusive contract with the CTIA — The Wireless Association® to serve as the registry operator for the administration of U.S. Common Short Codes. U.S. Common Short Codes are short strings of numbers to which text messages can be addressed — a common addressing scheme that works across all participating wireless networks. We were awarded this contract in October 2003 through an open procurement process by the major wireless carriers. In June 2008, the contract was amended to include a term through December 2015. We provide U.S. Common Short Code registration services to wireless content providers, who pay us subscription fees per U.S. Common Short Code registered.
Table of ContentsContracts We provide many of our addressing, interoperability and infrastructure services pursuant to private commercial and government contracts. Specifically, in the United States, we provide wireline and wireless number portability, implement the allocation of pooled blocks of telephone numbers and provide network management services pursuant to seven regional contracts with North American Portability Management LLC, an industry group that represents all telecommunications service providers in the United States. Although the FCC has plenary authority over the administration of telephone number portability, it is not a party to our contracts with North American Portability Management LLC. The North American Numbering Council, a federal advisory committee to which the FCC has delegated limited oversight responsibilities, reviews and oversees North American Portability Management LLC’s management of these contracts. See “— Regulatory Environment — Telephone Numbering.” We recognized revenue under our contracts with North American Portability Management LLC primarily on a per transaction basis through December 31, 2008, and the aggregate fees for transactions processed under these contracts were determined by the total number of transactions. As of January 1, 2009, we are paid on an annual, fixed-fee basis, subject to a contractually established, annual 6.5% escalator. Under this fixed-fee model, fixed credits are used to calculate the annual fixed fee in 2009, 2010 and 2011. In addition, our customers may earn additional credits annually in 2009, 2010 and 2011 if certain levels of aggregate telephone number inventories are reached and if certain IP fields and functionality are adopted and implemented. Moreover, in the event that the volume of transactions in a given year is above or below the contractually established volume range for that year, the fixed-fee may be adjusted up or down, respectively, with any such adjustment being applied in the following year. Under both the transaction-based and fixed-fee models, our fees are billed to telecommunications service providers based on their allocable share of the total transaction charges. This allocable share is based on each respective telecommunications service provider’s share of the aggregate end-user services revenues of all U.S. telecommunications service providers as determined by the FCC. Under these contracts, we also bill a revenue recovery collections, or RRC, fee of a percentage of monthly billings to our customers, which is available to us if any telecommunications service provider fails to pay its allocable share of total transaction charges. If the RRC fee is insufficient for that purpose, these contracts also provide for the recovery of such differences from the remaining telecommunications service providers. Under these contracts, users of our clearinghouse also pay fees to connect to our data center and additional fees for reports that we generate at the user’s request. Our contracts with North American Portability Management LLC continue through June 2015. On November 3, 2005, BellSouth Corporation filed a petition seeking changes in the way our customers are billed for services provided by us under our contracts with North American Portability Management LLC. In response to the BellSouth petition, the FCC requested comments from interested parties. As of February 17, 2009, the FCC had not initiated a formal rulemaking process, and the BellSouth petition remains pending. In addition, after the amendment of our contracts with North American Portability Management LLC in September 2006, Telcordia Technologies, Inc. filed a petition with the FCC requesting an order that would require North American Portability Management LLC to conduct a new bidding process to appoint a provider of telephone number portability services in the United States, which Telcordia has continued to pursue in response to our amendment of these contracts in January 2009. As of February 17, 2009, the FCC had not initiated a formal rulemaking process,
Table of Contentsand the Telcordia petition remains pending. If the Telcordia petition is successful, we may lose one or more of our contracts with North American Portability LLC or lose a portion of our business in one or more geographic regions where we provide services. We also provide wireline and wireless number portability and network management services in Canada pursuant to a contract with the Canadian LNP Consortium Inc., a private corporation composed of telecommunications service providers who participate in number portability in Canada. The Canadian Radio-television and Telecommunications Commission oversees the Canadian LNP Consortium’s management of this contract. We bill each telecommunications service provider for our services under this contract primarily on a per transaction basis. This contract continues through December 2011. The services we provide under the contracts with North American Portability Management LLC and the Canadian LNP Consortium are subject to rigorous performance standards, and we are subject to corresponding penalties for failure to meet those standards. We serve as the North American Numbering Plan Administrator and the National Pooling Administrator pursuant to two separate contracts with the FCC. Under these contracts, we administer the assignment and implementation of new area codes in North America, the allocation of central office codes (which are the prefixes following the area codes) to telecommunications service providers in the United States, and the assignment and allocation of pooled blocks of telephone numbers in the United States in a manner designed to conserve telephone number resources. The North American Numbering Plan Administration contract is a fixed-fee government contract that was awarded by the FCC in 2003. The contract is structured as a one-year agreement with four one-year options exercisable by the FCC. The FCC has exercised each of these four options, and this contract expired on July 8, 2008. The FCC extended the contract through July 2009 to begin the bidding process and we expect to compete for a renewal of this contract. The National Pooling Administration contract was originally awarded to us by the FCC in 2001. In August 2007, the FCC awarded us a new contract to continue as the National Pooling Administrator. Under this contract, we perform the administrative functions associated with the allocation of pooled blocks of telephone numbers in the United States. The terms of this contract provide for a fixed fee associated with the administration of the pooling system plus reimbursement of select costs. The initial contract term is two years, commencing in August 2007, and provides three one-year extension options that are exercisable at the election of the FCC. We are the operator of the .biz Internet top-level domain by contract with the Internet Corporation for Assigned Names and Numbers, or ICANN. The .biz contract was originally granted in May 2001. In December 2006, the ICANN awarded to us a renewal of the .biz contract through December 2012. Under the terms of the amended agreement, the .biz contract automatically renews after 2012 unless it has been determined that we have been in fundamental and material breach of certain provisions of the agreement and have failed to cure such breach. Similarly, pursuant to a contract with the U.S. Department of Commerce, we operate the .us Internet domain registry. This contract was originally awarded in October 2001. In October 2007, the government awarded to us a renewal of the .us contract for a period of three years, which may be extended by the government for two additional one-year periods. In response to a bid protest filed by one of our competitors, the Department of Commerce evaluated the procedures it followed in awarding to us the .us contract. Pending resolution of this evaluation, performance under our new .us contract was stayed, and the terms of our previous .us contract remained in effect. The evaluation was completed in August 2008 and the terms of the new .us contract were amended. The amended contract expires in October 2011, with two one-year renewal options exercisable by the Department of Commerce. The .biz and .us contracts allow us to provide domain name registration services to domain name registrars, who pay us on a per-name basis. We have an exclusive contract with the CTIA — The Wireless Association® to serve as the registry operator for the administration of U.S. Common Short Codes. U.S. Common Short Codes are short strings of numbers to which text messages can be addressed — a common addressing scheme that works across all participating wireless networks. We were awarded this contract in October 2003 through an open procurement process by the major wireless carriers. In June 2008, the contract was amended to include a term through December 2015. We provide U.S. Common Short Code registration services to wireless content providers, who pay us subscription fees per U.S. Common Short Code registered.
Table of ContentsThis excerpt taken from the NSR 10-K filed Feb 28, 2008. Contracts
We provide many of our addressing, interoperability and
infrastructure services pursuant to private commercial and
government contracts. Specifically, we provide wireline and
wireless number portability, implement the allocation of pooled
blocks of telephone numbers and provide network management
services pursuant to seven contracts with North American
Portability Management LLC, an industry group that represents
all telecommunications service providers in the United States.
Although the FCC has plenary authority over the administration
of telephone number portability, it is not a party to our
contracts with North American Portability Management LLC. The
North American Numbering Council, a federal advisory committee
to which the FCC has delegated limited oversight
responsibilities, reviews and oversees North American
Portability Management LLC’s management of these contracts.
See “— Regulatory
Environment— Telephone Numbering.” We recognize
revenue under our contracts with North American Portability
Management LLC primarily on a per transaction basis. The
aggregate fees for transactions processed under these contracts
are determined by the total number of transactions, and these
fees are billed to telecommunications service providers based on
their allocable share of the total transaction charges. This
allocable share is based on each respective telecommunications
service provider’s share of the aggregate end-user services
revenues of all U.S. telecommunications service providers
as determined by the FCC. On November 3, 2005, BellSouth
Corporation filed a petition seeking changes in the way our
customers are billed for services provided by us under our
contracts with North American Portability Management LLC. In
response to the BellSouth petition, the FCC requested comments
from interested parties. As of February 15, 2008, the FCC
had not initiated a formal rulemaking process, and the BellSouth
petition remains pending. We do not believe that the proposed
change to the manner in which we bill for services under these
contracts would have a material impact on our customers’
demand for these services. In addition, on June 13, 2007,
Telcordia Technologies, Inc. filed a petition with the FCC
requesting an order that would require North American
Portability Management LLC to conduct a new bidding process to
appoint a provider of telephone number portability services in
the United States. As of February 15, 2008, the FCC had not
initiated a formal rulemaking process, and the Telecordia
petition remains pending. If the Telecordia petition is
successful, we may lose one or more of our contracts with North
American Portability LLC. Under our contracts, we also bill a
revenue recovery collections, or RRC, fee of a percentage of
monthly billings to our customers, which is available to us if
any telecommunications service provider fails to pay its
allocable share of total transaction charges. If the RRC fee is
insufficient for that purpose, these contracts also provide for
the recovery of such differences from the remaining
telecommunications service providers. Under these contracts,
users of our clearinghouse also pay fees to connect to our data
center and additional fees for reports that we generate at the
user’s request. Our contracts with North American
Portability Management LLC continue through June 2015.
We also provide wireline number portability and network
management services in Canada pursuant to a contract with the
Canadian LNP Consortium Inc., a private corporation composed of
telecommunications service providers who participate in number
portability in Canada. The Canadian Radio-television and
Telecommunications Commission oversees the Canadian LNP
Consortium’s management of this contract. We bill each
telecommunications service provider for our services under this
contract primarily on a per transaction basis. This contract
continues through December 2011. The services we provide under
the contracts with North American Portability Management LLC and
the Canadian LNP Consortium are subject to rigorous performance
standards, and we are subject to corresponding penalties for
failure to meet those standards.
We serve as the North American Numbering Plan Administrator and
the National Pooling Administrator pursuant to two separate
contracts with the FCC. Under these contracts, we administer the
assignment and implementation of new area codes in North
America, the allocation of central office codes (which are the
prefixes following the area codes) to telecommunications service
providers in the United States, and the assignment and
allocation of pooled blocks of telephone numbers in the United
States in a manner designed to conserve telephone number
resources. The North American Numbering Plan Administration
contract is a fixed-fee government
contract that was awarded by the FCC in 2003. The contract is
structured as a one-year agreement with four one-year options
exercisable by the FCC. The FCC has exercised each of these four
options, and this contract is due to expire on July 8,
2008. We expect to compete for a renewal of this contract. The
National Pooling Administration contract was originally awarded
to us by the FCC in 2001. In August 2007, the FCC awarded us a
new contract to continue as the National Pooling Administrator.
Under this new contract, we will continue to perform the
administrative functions associated with the allocation of
pooled blocks of telephone numbers in the United States. The
terms of this new contract provide for a fixed fee associated
with the administration of the pooling system plus reimbursement
of select costs. The initial contract term is two years,
commencing in August 2007, and provides three one-year extension
options that are exercisable at the election of the FCC.
We are the operator of the .biz Internet top-level domain by
contract with the Internet Corporation for Assigned Names and
Numbers, or ICANN. The .biz contract was originally granted in
May 2001. In December 2006, the ICANN awarded to us a renewal of
the .biz contract through December 2012. Under the terms of the
amended agreement, the .biz contract automatically renews after
2012 unless it has been determined that we have been in
fundamental and material breach of certain provisions of the
agreement and have failed to cure such breach. Similarly,
pursuant to a contract with the U.S. Department of
Commerce, we operate the .us Internet domain registry. This
contract was originally awarded in October 2001. In October
2007, the government awarded to us a renewal of the .us contract
for a period of three years, which may be extended by the
government for two additional one-year periods. The Department
of Commerce is currently evaluating the procedures it followed
in awarding to us the .us contract, in response to a bid protest
filed by one of our competitors. Pending resolution of this
evaluation, performance under our new .us contract has been
stayed, and the terms of our previous .us contract remain in
effect. The .biz and .us contracts allow us to provide domain
name registration services to domain name registrars, who pay us
on a per-name basis.
We have an exclusive contract with the CTIA — The
Wireless
Association®
to serve as the registry operator for the administration of
U.S. Common Short Codes. U.S. Common Short Codes are
short strings of numbers to which text messages can be
addressed — a common addressing scheme that works
across all participating wireless networks. We were awarded this
contract in October 2003 through an open procurement process by
the major wireless carriers. The initial term of the contract
continued through April 2006, and was renewed automatically for
an additional two-year period pursuant to the terms of the
contract. Under the terms of the contract, the term
automatically renews for additional two-year periods unless
terminated in accordance with its terms. We provide
U.S. Common Short Code registration services to wireless
content providers, who pay us subscription fees per
U.S. Common Short Code registered.
This excerpt taken from the NSR 10-K filed Mar 1, 2007. Contracts
We provide many of our addressing, interoperability and
infrastructure services pursuant to private commercial and
government contracts. Specifically, we provide wireline and
wireless number portability, implement the allocation of pooled
blocks of telephone numbers and provide network management
services pursuant to seven contracts with North American
Portability Management LLC, an industry group that represents
all telecommunications service providers in the United States.
Although the FCC has plenary authority over the administration
of telephone number portability, it is not a party to our
contracts with North American Portability Management LLC. The
North American Numbering Council, a federal advisory committee
to which the FCC has delegated limited oversight
responsibilities, reviews and oversees North American
Portability Management LLC’s management of these contracts.
See “— Regulatory
Environment — Telephone Numbering.” We
recognize revenue under our contracts with North American
Portability Management LLC primarily on a per transaction basis.
The aggregate fees for transactions processed under these
contracts are determined by the total number of transactions,
and these fees are billed to telecommunications service
providers based on their allocable share of the total
transaction charges. This allocable share is based on each
respective telecommunications service provider’s share of
the aggregate end-user services revenues of all
U.S. telecommunications service providers as determined by
the FCC. On November 4, 2005, BellSouth Corporation filed a
petition seeking changes in the way our customers are billed for
services provided by us under our contracts with North American
Portability Management LLC. In response to the BellSouth
petition, the FCC requested comments from interested parties. As
of February 15, 2007, the FCC had not initiated a formal
rulemaking process, and the BellSouth petition remains pending.
We do not
believe that this proposed change to the manner in which we bill
for services under these contracts would have a material impact
on our customers’ demand for these services. Under our
contracts, we also bill a revenue recovery collections, or RRC,
fee of a percentage of monthly billings to our customers, which
is available to us if any telecommunications service provider
fails to pay its allocable share of total transaction charges.
If the RRC fee is insufficient for that purpose, these contracts
also provide for the recovery of such differences from the
remaining telecommunications service providers. Under these
contracts, users of our clearinghouse also pay fees to connect
to our data center and additional fees for reports that we
generate at the user’s request. Our contracts with North
American Portability Management LLC continue through June 2015.
We also provide wireline number portability and network
management services in Canada pursuant to a contract with the
Canadian LNP Consortium Inc., a private corporation composed of
telecommunications service providers who participate in number
portability in Canada. The Canadian Radio-television and
Telecommunications Commission oversees the Canadian LNP
Consortium’s management of this contract. We bill each
telecommunications service provider for our services under this
contract primarily on a per-transaction basis. This contract
continues through December 2011. The services we provide under
the contracts with North American Portability Management LLC and
the Canadian LNP Consortium are subject to rigorous performance
standards, and we are subject to corresponding penalties for
failure to meet those standards.
We serve as the North American Numbering Plan Administrator and
the National Pooling Administrator pursuant to two separate
contracts with the FCC. Under these contracts, we administer the
assignment and implementation of new area codes in North
America, the allocation of central office codes (which are the
prefixes following the area codes) to telecommunications service
providers in the United States, and the assignment and
allocation of pooled blocks of telephone numbers in the United
States in a manner designed to conserve telephone number
resources. The North American Numbering Plan Administration
contract is a fixed-fee government contract that was awarded by
the FCC in 2003. The contract is structured as a one-year
agreement with four one-year options exercisable by the FCC. The
FCC has exercised three of these one-year extension options and
may extend the contract for two additional one-year periods
continuing through July 8, 2008. The National Pooling
Administration contract is a cost-plus government contract that
was awarded by the FCC in 2001. This contract also is structured
as a one-year agreement with four one-year options exercisable
by the FCC. The FCC exercised each of the four options, and this
contract was due to expire on June 14, 2006. Since that
time, the National Pooling Administration contract has been
extended for several short-term periods while the FCC conducts a
formal rebid of the contract. We expect to compete for a renewal
of this contract.
We are the operator of the .biz Internet top-level domain by
contract with the Internet Corporation for Assigned Names and
Numbers, or ICANN. The .biz contract was originally granted in
May 2001. In December 2006, the ICANN awarded to us a renewal of
the .biz contract through December 2012. Under the terms of the
amended agreement, the .biz contract automatically renews after
2012 unless it has been determined that we have been in
fundamental and material breach of certain provisions of the
agreement and have failed to cure such breach. Similarly,
pursuant to a contract with the U.S. Department of
Commerce, we operate the .us Internet domain registry. This
contract was awarded in October 2001 for a period of four years,
which may be extended by the government for two additional
one-year periods. The government exercised the first one-year
option in October 2005, and the second one-year option in
October 2006. These contracts allow us to provide domain name
registration services to domain name registrars, who pay us on a
per-name basis. We expect to compete for a renewal of this
contract.
We have an exclusive contract with the CTIA — The
Wireless
Association®
to serve as the registry operator for the administration of
U.S. Common Short Codes. U.S. Common Short Codes are
short strings of numbers to which text messages can be
addressed — a common addressing scheme that works
across all participating wireless networks. We were awarded this
contract in October 2003 through an open procurement process by
the major wireless carriers. The initial term of the contract
continued through April 2006, and was renewed automatically for
an additional two-year period pursuant to the terms of the
contract. Under the terms of the contract, the term
automatically renews for additional two-year periods unless
terminated in accordance with its terms. We provide
U.S. Common Short Code registration services to wireless
content providers, who pay us subscription fees per
U.S. Common Short Code registered.
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