Cogent Communications offers a compelling sales pitch: data at
the speed of light. The company operates a fiber-optic data network
that serves customers in North America, Mexico, and
Europe. It offers dedicated Internet access and data transport
services to businesses through Ethernet connections that link its
41 data center facilities directly to customer office buildings.
Cogent's clients include financial services companies,
universities, and law firms. The company also sells access to its
network and provides colocation and modem management services to
ISPs, hosting companies, and other high-volume bandwidth users.
The company generates most of its revenues from customers
connected directly to its network (on-net customers), while clients
served through other carriers' facilities (off-net customers)
account for a smaller percentage of Cogent's revenues. Customers in
Europe account for more than 20% of sales.
Cogent does business in 155 metropolitan markets, primarily
serving multitenant office buildings. The company has said that it
is focusing on expanding its on-net customers, and it has expanded
its sales force to address a broader range of clients. Cogent is
also investing in its network infrastructure to reach more clients.
It established connections with about 100 additional building
networks in 2010, bringing the total to more than 1,500.
Cogent has a history of fiscal losses. Its operating expenses
have outpaced its revenues as the company has bought and built its
way to a larger network footprint and customer base. While
steadily driving up sales every year since 2005, the company
has continued to lose money as it pours capital into extending
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