Fusion’s Strategy
Our strategy is to continue to grow our existing Carrier Services business, which today comprises 95% of our revenue while accelerating the growth of our Corporate Services business to ensure that an increasing portion of our total revenues is derived from the higher margin, more stable and largely recurring Corporate Services business segment . We believe that the Carrier Services business supports the growth of the Corporate Services business by providing enhanced service offerings for our corporate customers, by lowering the overall cost basis of the communication infrastructure shared by the Corporate Services business and by strengthening our relationships with key service providers and carriers throughout the world.
Growth in the Carrier Service business will be driven by expanding the number of international carriers with whom we interconnect; expanding sales to non-traditional carriers, including cable television providers, Internet search engine companies, and large IP telephone companies; and by expanding current carrier relationships to maximize the traffic received from and sent to them.
We intend to generate substantial growth in the Corporate Services segment to make the revenues and margins from this segment a more significant portion of our total revenues and margins. The expansion of the Corporate Services business will come from both organic growth and acquisitions . Organic growth will be delivered from a combination of expanding the number and types of services available and sold to our current customers and by customizing our product and service offerings to address the needs of target large sectors. We believe that there is substantial opportunity to gain market share, to increase the size of our average sale and to sell a broad range of our products by focusing on offering highly targeted product and service solutions to these large sectors including healthcare, transportation and education.
Our strong entry into these markets also leverages our experience and relationships to provide a competitive advantage and offers the opportunity to create sector specific partnerships with incumbent cloud service providers in each sector. Such larger sales to enterprise customers typically have lower churn rates and provide substantial opportunities for adding additional services to a core communications offering. Targeted, “bolt-on” acquisitions are also seen as part of our core strategy , expanding our customer base and providing new prospective customers for our growing portfolio of cloud services; potentially adding products and services to our own; and increasing the scale of our operations while leveraging our existing infrastructure and costs. Such acquisitions may be consummated at lower valuation multiples than would be accorded to Fusion, thus effectively lowering the cost of the acquisition.
