Changes in the structure of the communications industry over the past two decades have presented increasingly complex technical and operating challenges. Whereas the Bell Operating System once dominated the U.S. telecommunications industry, there are now thousands of service providers, all with disparate networks. Today these service providers must interconnect their networks and carry each other's traffic to route phone calls, unlike in the past when a small number of incumbent wireline carriers used established bilateral relationships. In addition, CSPs are delivering a broad set of new services using a diverse array of technologies. These services, which include voice, data and video, are used in combinations that are far more complex than the historical, uniform voice services of traditional carriers.

The increasing complexity of the communications industry has produced operational challenges, as the legacy, in-house network management and back office systems of traditional carriers were not designed to capture all of the information necessary for provisioning, authorizing, routing and billing these new services. In particular, it has become significantly more difficult for service providers to locate end-users, establish identity, connect, provide services and process transactions.

The Company believes that its clearinghouse is the most efficient, logistically practical and economical means for each CSP to exchange the large volumes of operating data that are required to deliver communications services between networks. The Company’s clearinghouse is the master, authoritative directory that allows end-users to change their telephone carrier without changing their telephone numbers. The Company has provided this service for wireline local number portability since 1997, and in 2003 the Company expanded its service to provide portability of telephone numbers between wireless CSPs and between wireline and wireless CSPs. The Company provides centralized clearinghouse services that permit its customers, through a single interface, to exchange essential operating data with multiple CSPs in order to provision services. The Company recently launched a suite of interoperability services, including services that enable the exchange of VoIP and streaming media traffic between networks using session initiation protocol, or SIP, technology, either carrier-to-carrier or content provider-to-carrier. These services provide functions that are essential to the deployment of VoIP as well as SIP-based streaming media content services, such as video or music on demand, and real-time multimedia conferencing. The Company recently launched its IP-based identity management clearinghouse services, using the Liberty Alliance standards.

The Company’s infrastructure services are used by CSPs to efficiently reconfigure their networks and systems in response to changes in the market. The Company’s customers use its clearinghouse to centrally process changes to essential network elements that are used to route telephone calls. The Company provides standard interfaces for those TSPs who connect directly to its clearinghouse. The Company recently launched service order provisioning services that enable CSPs to manage their internal systems through an automated interface to the Company’s clearinghouse and other shared industry databases. This service eliminates the need for service providers to build and maintain their own internal service order provisioning system. Increasingly, CSPs are required to produce voluminous records and conduct clandestine electronic surveillance for public safety and homeland security. The Company’s services provide carriers a single point of contact for all information and surveillance requests.

Cost of revenue for the year ended December 31, 2004 were $49.3 million, representing an increase of $11.4 million, or 30.2%, as compared to cost of revenue of $37.8 million for the year ended December 31, 2003.

Selling and marketing expenses for the year ended December 31, 2004 was $22.7 million, an increase of $8.4 million, or 58.1%, as compared to selling and marketing expenses of $14.4 million for the year ended December 31, 2003.

Research and development expenses for the year ended December 31, 2004 was $7.4 million representing an increase of $0.7 million or 10.5% from $6.7 million for the year ended December 31, 2003.

Net income for the year ended December 31, 2004 was $45.4 million an increase of $21.3 million, or 88.9% compared to a $24.0 million for the year ended December 31, 2003.