What changed in this filing

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Item 1. Business

2023-02-24 compared with 2022-02-25 · 76 added, 70 removed, 268 unchanged (35% of the section changed)

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Our network is specifically designed and optimized to transmit packet switched data.

We deliver our services primarily to small and medium-sized businesses, communications service providers and other bandwidth-intensive organizations in 50 countries across North America, Europe, Asia, South America, Australia and Africa.

We deliver our services primarily to small and medium-sized businesses, communications service providers and other bandwidth-intensive organizations in 51 countries across North America, Europe, Asia, South America, Oceania and Africa.

We are a Delaware corporation, and we are headquartered in Washington, DC.

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We provide our on-net Internet access and private network services to our corporate and net-centric customers.

Our corporate customers are located in multi-tenant office buildings and typically include law firms, financial services firms, advertising and marketing firms , as well as health care providers, educational institutions and other professional services businesses.

Our corporate customers are located in multi-tenant office buildings (“MTOBs”) and typically include law firms, financial services firms, advertising and marketing firms, as well as health care providers, educational institutions and other professional services businesses.

Our net-centric customers include bandwidth-intensive users that leverage our network to either deliver content to end users or to provide access to residential or commercial Internet users.

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We provide these off-net services primarily to corporate customers using other carriers’ circuits to provide the “last mile” portion of the link from the customers’ premises to our network.

We also provide certain non-core services as a result of certain acquisitions.

We continue to support but do not actively sell these non-core services.

We expect revenue from non-core services to continue to decline or to remain flat.

Acquisition of Sprint Communications

On September 6, 2022, Cogent Infrastructure, Inc., a Delaware corporation (the “Buyer”) and a wholly owned subsidiary of the Company, entered into a Membership Interest Purchase Agreement (the “Purchase Agreement”) with Sprint Communications LLC, a Kansas limited liability company (“Sprint Communications”) and an indirect wholly owned subsidiary of T-Mobile US, Inc., a Delaware corporation (“T-Mobile”), and Sprint LLC, a Delaware limited liability company and a direct wholly owned subsidiary of T-Mobile (the “Seller”), pursuant to which the Company will acquire the U.S.

long-haul fiber network (including the non-U.S.

extensions thereof) of Sprint Communications and its subsidiaries (the “Wireline Business”).

The Purchase Agreement provides that, upon the terms and conditions set forth therein, the Company will purchase from the Seller all of the issued and outstanding membership interests of a Delaware limited liability company that holds Sprint Communications’ assets and liabilities relating to the Wireline Business (such transactions contemplated by the Purchase Agreement, collectively, the “Transaction”).

In connection with our pending acquisition of the Wireline Business, we will begin to provide optical wavelength services over our fiber network.

We will sell these wavelength services to our existing customers, customers of Sprint Communications and to new customers who require dedicated optical transport connectivity without the capital and ongoing expenses associated with owning and operating network infrastructure.

Competitive Advantages

We believe we address many of the data communications needs of small and medium-sized businesses, communications service providers and other bandwidth-intensive organizations by offering them high-quality, high-speed Internet access and private network services at attractive prices.

After our acquisition of the Wireline Business we will be offering services to larger enterprise customers.

We believe that our organization has the following competitive advantages:

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This price deflation is a result of a variety of factors including increased competition, enhanced substitutability of certain products and services and the continued impact of Moore’s Law, which has driven down the cost of technology, particularly for fiber optic Wavelength Division Multiplexing (“WDM”) equipment and optically interfaced routers.

Faced with the backdrop of continued price deflation in our industry, we have made a series of discreet choices around our network design, operating strategy and product offering that are consistent with our objective of becoming the low cost operator in our industry.

Since we initiated operations, this strategy has resulted in a rapid decline in our cost to transmit bits, which has increased our margins and decreased our capital intensity as measured by our capital expenditures per total revenues.

Faced with the backdrop of continued price deflation in our industry, we have made a series of discreet choices around our network design, operating strategy and product offerings that are consistent with our objective of becoming the low cost operator in our industry.

Since our initiation of operations, this strategy has resulted in a rapid decline in our cost to transmit bits, which has increased our margins and decreased our capital intensity as measured by our capital expenditures per total revenues.

Over the last five fiscal years, our cost of goods sold per bit delivered for our customers has declined at a compounded annual rate of 21.0%.

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We believe the vast majority of our competition currently operates their networks with multiple protocols and we believe that attempts to upgrade their networks to one protocol would be operationally challenging and costly.

● Wide Spread Access to Fiber on a Cost Effective, Long-Term Basis .

● Widespread Access to Fiber on a Cost Effective, Long-Term Basis.

We have acquired a large portfolio of dark fiber leases from around the world sourced from the excess inventory of existing networks.

The choice to lease rather than build reduces our capital intensity and the operating costs of our intercity and metro networks.

The nature of this portfolio and the individual leases provides us long-term access to dark fiber at attractive rates and the opportunity in many cases to extend these leases for multiple terms.

This choice to lease rather than build reduces our capital intensity and the operating costs of our intercity and metro networks.

The nature of this portfolio and the individual leases provide us long-term access to dark fiber at attractive rates and the opportunity in many cases to extend these leases for multiple terms.

On average, a modest number of our dark fiber leases come up for renewal each year.

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Since our founding, we have strategically focused on delivering a very narrow product set to our customers.

The vast majority of our revenue is driven or related to our high-capacity, bi-directional, symmetric internet access services which can be accessed on-net in large multi-tenant office buildings and carrier neutral data centers or off-net through other carriers’ “last mile” connections to customer facilities.

The vast majority of our revenue is driven or related to our high-capacity, bi-directional, symmetric internet access services which can be accessed on-net in MTOBs and carrier neutral data centers (“CNDCs”) or off-net through other carriers’ “last mile” connections to customer facilities.

There are significant cost advantages as a result of this narrow product set.

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Our on-net service does not rely on circuits that must be provisioned by a third-party carrier.

In our on-net multi-tenant office buildings (“MTOBs”) we provide our customers the entire network, including the “last mile” and the in-building wiring connecting to our customer’s suite.

In our carrier neutral data centers (“CNDCs”) we are collocated with our customers.

In our on-net MTOBs we provide our customers the entire network, including the “last mile” and the in-building wiring connecting to our customer’s suite.

In our CNDCs we are collocated with our customers.

As a result, only a cross-connection within the data center is required to provide our services to our customers.

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Our network is connected to 3,155 total buildings located in 219 metropolitan markets.

These buildings include 1,817 large MTOBs (totaling 986.9 million square feet of office space) in major North American cities where we offer our services to a diverse set of high-quality corporate customers within close physical proximity of each other.

These buildings also include 1,359 CNDCs located in 1,164 buildings in North America, Europe, Asia, South America, Australia and Africa where our net-centric customers directly interconnect with our network.

These buildings include 1,837 large MTOBs (totaling 1.0 billion square feet of office space) in major North American cities where we offer our services to a diverse set of high-quality corporate customers within close physical proximity of each other.

These buildings also include 1,458 CNDCs located in 1,264 buildings in North America, Europe, Asia, South America, Oceania and Africa where our net-centric customers directly interconnect with our network.

We also operate 54 of our own data centers across the United States and in Europe, which comprise over 606,000 square feet of floor space and are directly connected to our network.

Our anticipated acquisition of the Wireline Business will add approximately 45 data centers to our network.

We believe that these network points of presence strategically position our network to attract high levels of Internet traffic and maximize our revenue opportunities and profitability.

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We currently serve 7,792 access networks as well as numerous large and small content providers and 44,844 corporate customer connections.

As a result of these growing bases of customers who distribute (content providers) and receive (access networks) content on our network, the majority of all the traffic on our network remains “on-net’ by both originating and terminating on our network.

As a result of these growing bases of customers who distribute (content providers) and receive (access networks) content on our network, we believe that the majority of all the traffic remains “on-net” by both originating and terminating on our network.

This control of traffic is an important differentiator as it increases our service reliability and speed of traffic delivery.

The increasing share of traffic delivered from content providers to access networks also enhances our margins as we are compensated by both the originator and terminating customers.

The breadth of our network, extensive size of our customer base,

and the volume of our network traffic enables us to be one of a handful of Tier 1 networks that are interconnected on a settlement-free basis.

This Tier 1 interconnection status broadens our geographic delivery capability and materially reduces our network costs.

The increasing share of traffic delivered from content providers to access networks also enhances our margins as we are compensated by both the originating customer and terminating customer.

The breadth of our network, extensive size of our customer base, and the volume of our traffic enables us to be one of a handful of Tier 1 networks that are interconnected on a settlement-free basis.

This Tier 1 network peering status broadens our geographic delivery capability and materially reduces our network costs.

Proven and Experienced Management Team .

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Several members of the senior management team have been working together at the Company since 2000.

Our senior management team has designed and built our network and, during our formative years, led the integration of network assets we acquired through 13 significant acquisitions and managed the expansion and growth of our business.

Our senior management team has designed and built our network and, during our formative years, led the integration of network assets we acquired through 13 significant acquisitions, excluding the pending acquisition of the Wireline Business, and managed the expansion and growth of our business.

We anticipate that our management team will successfully manage the integration of the Wireline Business into our current operations.

We intend to become the leading provider of high-quality, high-speed Internet access and private network services and to continue to improve our profitability and cash flow.

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Grow our Corporate Customer Base.

Our on-net corporate customers are typically small to medium-sized businesses connected to our network through multi-tenant office buildings or connected to our network through one of our carrier neutral data centers.

Our on-net corporate customers are typically small to medium-sized businesses connected to our network through MTOBs or connected to our network through one of our CNDCs.

We generally sell two types of services to our corporate customers:

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We believe that the importance of data centers will increasingly lead tenants to reconfigure their communications infrastructure to include dedicated internet access across their locations.

After our acquisition of the Wireline Business we will be offering services to larger enterprise customers.

Increase our Share of the Net-Centric Market .

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We expect that we will continue to grow our shares of these segments by offering our customers a series of attractive features including:

● Geographic breadth – We have the broadest carrier neutral data center footprint in the industry and currently offer network services in 50 countries – as net-centric customers seek a more international audience this footprint is a significant advantage;

● High capacity and reliability – We offer 100 Mbps to 400 Gbps ports in all of the carrier neutral data centers and 400Gbps in selected locations on our network, which differentiates the capacity choices we provide our net-centric clients;

● Geographic breadth – We have the broadest CNDC footprint in the industry and currently offer network services in 51 countries – as net-centric customers seek a more international audience this footprint is a significant advantage;

● High capacity and reliability – We offer 100 Mbps to 100 Gbps ports in all of the CNDCs and 400 Gbps in selected locations on our network, which differentiates the capacity choices we provide our net-centric clients;

● Balanced customer base – Our leading share of content providers and access networks increases the amount of traffic that originates and terminates on our network thereby reducing latency and enhancing reliability;

● Large and dedicated salesforce – Our team of 216 net-centric sales professionals is one of the largest salesforces in this industry segment and enables us to better serve this customer segment while also identifying new sales opportunities and gaining new business and customers.

● Competitive pricing – We aggressively price and offer discounts for our services to customers in order to attract new customers and drive volume.

● The customers of the Wireline Business will include a number of large enterprise customers, a type of customer that we have not traditionally served.

Develop a Worldwide Peering Platform.

In late 2020 we introduced a new product, Global Peer Connect (“GPC”), targeted at the growing demand for certain net-centric customers to dynamically peer traffic anywhere on our global platform.

Our GPC product provides access to our Global Peer Exchange (“GPE”) which is a worldwide connectivity platform for the exchange of peering traffic destined for the Internet.

In late 2020 we introduced a new product, Global Peer Connect, targeted at the growing demand for certain net-centric customers to dynamically peer traffic anywhere on our global platform.

Our Global Peer Connect product provides access to our Global Peer Exchange which is a worldwide connectivity platform for the exchange of peering traffic destined for the Internet.

Similar product offerings in the marketplace offer a materially smaller geographic footprint configuration and require a higher fixed cost for customers.

We currently serve over 400 connections via our Global Peer Exchange.

Pursue On-net Customer Growth.

Our high-capacity network provides us with the ability to add a significant number of customers to our network with minimal direct incremental costs.

We intend to increase usage of our network and operational infrastructure by adding customers in our existing on-net buildings, as well as developing additional markets and connecting more multi-tenant office buildings and carrier neutral data centers to our network.

We emphasize our on-net services because they generate greater profit margins and we have more control over service levels, quality, pricing and our on-net services are provisioned in considerably less time than our off-net services.

We emphasize our on-net services because they generate greater profit margins and we have more control over service levels, quality and pricing, and our on-net services are provisioned in considerably less time than our off-net services.

Our fiber network connects directly to our on-net customers’ premises and we pay no local access (“last mile”) charges to other carriers to provide our on-net services.

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In order to gain market share in our targeted businesses, we expect to continue our sales efforts including introducing strategies and tools to optimize and improve our sales productivity.

We have developed several training programs that are directed toward increasing our sales representative tenure and increasing our sales representative productivity.

Expand our Off-net Corporate Internet Access Business.

We have agreements with national carriers providing us last mile network access to over 4.0 million commercial buildings across North America that are lit by fiber optic cable and that are not currently served by our network.

We have agreements with over 500 national and international carriers providing us last mile network access to over 4 million commercial buildings that are lit by fiber optic cable across North America and that are not currently served by our network.

We believe these agreements broaden our addressable market for corporate dedicated internet access and enhances our competitive position through the ability to provide enterprise-wide connectivity for corporate customers.

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We continue to negotiate reduced pricing under our numerous carrier agreements that enable us to reduce our cost of off-net services which enhances our competitive position in the marketplace.

Expand our Product Offerings to Include Wavelength and Optical Transport Services .

In connection with our pending acquisition of the Wireline Business of Sprint Communications, we will begin to provide optical wavelength and optical transport services, initially in the United States, over our fiber network.

We will sell these services to our existing customers, customers of Sprint Communications and to new customers who require dedicated optical transport connectivity without the capital and ongoing expenses associated with owning and operating network infrastructure.

Our network is comprised of in-building riser facilities, metropolitan optical networks, metropolitan traffic aggregation points and inter-city transport facilities.

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We believe that our network is more reliable and carries packet switched traffic at lower cost than networks built as overlays to traditional circuit-switched telephone networks.

Our network is comprised of 3,035 buildings which are on net and we serve 216 metropolitan markets in North America, Europe, Asia, South America, Australia and Africa.

Our network is comprised of 3,155 buildings which are on-net and we serve 219 metropolitan markets in North America, Europe, Asia, South America, Oceania and Africa.

Important strategic components of our network include:

● 1,817 multi-tenant office buildings strategically located in commercial business districts;

● 1,359 carrier neutral data centers located in 1,164 buildings offering our customers the largest portfolio of CNDCs of any carrier;

● 1,837 MTOBs strategically located in commercial business districts;

● 1,458 CNDCs located in 1,264 buildings offering our customers the largest portfolio of CNDCs of any carrier;

● 54 Cogent Data Centers;

● 1,120 intra-city networks, or rings, consisting of 42,491 fiber miles and 17,616 fiber route miles;

● an inter-city network of 60,676 fiber route miles;

● multiple high-capacity transoceanic circuits that connect the North American, European, Asian, South American, Australian and African portions of our network.

● an inter-city network of 61,292 terrestrial fiber route miles;

● 197 high-capacity transoceanic circuits that connect the North American, European, Asian, South American, Oceanic and African portions of our network.

We have created our network by leasing on a long-term basis optical fiber from carriers with large amounts of unused fiber and directly connecting Internet routers to our existing optical fiber national backbone.

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Due to our network design and acquisition strategy, we believe we are positioned to grow our revenue and increase our profitability with limited incremental capital expenditures.

Inter-city Networks.

Inter-city Network.

Our inter-city network consists of optical fiber, including transoceanic capacity circuits for undersea portions, connecting major cities in North America, Europe, Asia, South America, Australia and Africa.

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Our network is collocated in and can provide connectivity to customers in 1,458 CNDCs located in 1,264 buildings across our footprint.

CNDCs are an integral component of the Internet Infrastructure where Content Providers, Application Service Providers, Carriers and Corporates locate their server and service infrastructure.

CNDCs offer highly reliable, secure, cost effective and convenient space for these operators to access important services including connectivity, power, rack space and security all on a 24 hour basis in order to support their Internet activities.

CNDCs are an integral component of the Internet infrastructure where content providers, application service providers, carriers and corporate customers locate their server and service infrastructure.

CNDCs offer highly reliable, secure, cost effective and convenient space for these operators to access important services including connectivity, power, rack space and security all on a 24-hour basis in order to support their Internet activities, and after our anticipated acquisition of the Wireline Business, wavelength services.

We believe we are connected to more CNDCs than any other IP transit provider, enabling us to offer greater coverage, more network configuration choices and increased reliability for our net-centric customers.

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The Internet is an aggregation of interconnected networks.

Larger Internet service providers, or ISP’s, exchange traffic and interconnect their networks by means of direct private connections referred to as private peering.

Larger ISPs exchange traffic and interconnect their networks by means of direct private connections referred to as private peering.

We interconnect with the networks of our customers, which represents the majority of our interconnections and network traffic, through the sale of our transit services.

We currently interconnect with 7,769 networks who pay to exchange traffic with us as customers.

We supplement our customer network interconnections with settlement-free, peering to our non-customer ISP’s.

We have settlement-free private peering interconnections between our network and 24 other major ISP’s who are not our customers.

We supplement our customer network interconnections with settlement-free peering to our non-customer ISPs.

We have settlement-free private peering interconnections between our network and 23 other major ISPs who are not our customers.

Tier 1 ISP Status.

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In addition, we have maintenance contracts with third-party vendors that specialize in maintaining optical and routed networks.

In connection with our acquisition of the Wireline Business we will be adding network operations centers in Kansas City, Kansas, Atlanta, Georgia, Dallas, Texas and Orlando, Florida.

Our Customers

We offer our high-speed Internet access and IP connectivity services to two sets of customers:

corporates customers, which primarily include small and medium-sized businesses located in North America, and net-centric customers, which include, content providers, applications service providers and access networks, comprised of ISPs, cable operators, mobile operators and phone companies located in North America, Europe, Asia, South America, Australia and Africa.

Our corporate customers primarily purchase direct internet access from us on-net in multi-tenant office buildings and carrier neutral data centers or off-net through other carriers’ “last mile” connections to those customer facilities in metropolitan markets in North America.

Our corporate customers primarily purchase direct internet access from us on-net in MTOBs and CNDCs or off-net through other carriers’ “last mile” connections to those customer facilities in metropolitan markets in North America.

This service enables these customers to access the Internet with a high-speed, bi-directional, symmetric circuit with a very high degree of reliability and 100% access to that contractual capacity at all times.

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The continued growth in demand for increased bandwidth has led to a rapid shift towards higher capacity circuits.

We have agreements with multiple national and regional carriers providing us “last mile” network access to over 4 million buildings across North America that are not currently served by our network.

We have agreements with multiple national, international and regional carriers providing us “last mile” network access to over 4 million buildings across North America that are not currently served by our network.

We believe these agreements broaden our addressable market for corporate dedicated internet access and VPN services and enable us to better leverage the skills and capacity of our direct salesforce.

As our sales of off-net services has increased, the pricing in our carrier agreements has commensurately decreased in light of our increased volume.

Our net-centric customers purchase IP connectivity and other services in our 1,359 carrier neutral data centers as well as our 54 data centers for a total of 1,413 data centers.

Our net-centric customers purchase IP connectivity and other services in our 1,458 CNDCs as well as our 54 data centers for a total of 1,512 data centers.

We support these services in 219 metropolitan markets in 51 countries across the world.

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Unions represent 27 of our employees in France.

The employees of the Wireline Business that operates in Germany are governed by a works council.

We believe that we have a satisfactory relationship with our employees.

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Diversity and Inclusion .

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For the year ending December 31, 2022, we averaged a 5.8% monthly churn rate within our sales representatives.

This churn was caused primarily by failures to meet sales performance goals as well as departures precipitated, we believe, by our decision to return to a full-time, in office work environment and a requirement to be fully vaccinated against COVID-19 in the fall of 2021.

During 2021, we hired 371 new sales representatives and ended the year with 490 sales representatives, a net decrease of 79 sales representatives from our total sales representatives at the beginning of 2021.

This churn was caused primarily by failures to meet sales performance goals as well as departures precipitated, we believe, by our decision to require all employees to adhere to a full-time, in office work environment as well as a tightening labor market creating increased competition when hiring.

During 2022, we hired 401 new sales representatives and ended the year with 548 sales representatives, a net increase of 58 sales representatives from our total sales representatives at the beginning of 2022.

Our ability to recruit and retain all of our employees depends on a number of factors, including professional development, compensation and benefits, and employee engagement.

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Our trainers also conduct training at our annual sales meeting, during which our entire sales force gathers to learn new skills and reinforce existing skills.

All sales personnel receive four weeks of live, inter-active training during their first month, which focuses on developing both general and Cogent-specific sales skills.

All sales personnel receive four weeks of live, interactive training during their first month, which focuses on developing both general and Cogent-specific sales skills.

New sales personnel are also encouraged to, and rewarded for, completing a self-paced, online curriculum led by their manager during their first six months.

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While nearly all of our employees work solely in office environments, for our field personnel, we provide safety gear as appropriate given employee job duties.

During the COVID-19 pandemic, we invested heavily to help ensure the health of our employees.

Beginning in March 2020, we closed all of our offices worldwide, requiring our entire workforce to work remotely whenever possible.

We procured additional computer equipment to permit all employees to work remotely.

While our offices have largely remained closed, we believe that it is important to our company culture and employee productivity to return to an in-office environment when it is safe to do so.

A cross-functional team within Cogent has established safety procedures to transition employees for a return to office, including training and additional safety and sanitation supplies.

With respect to our decision to require all employees to work in an in-office environment, we continue to mandate that all employees in the United States and Canada, except those with legal exemptions, be vaccinated against the against the COVID-19 virus.

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In the summer of 2021, we began the process of transitioning back to an in-office environment.

As part of this process, we mandated that all employees in the United States and Canada, except those with legal exemptions, be vaccinated against the COVID-19 virus no later than October 2021.

In September 2021, all fully-vaccinated employees returned to our offices in the United States and Canada on a full-time basis.

All employees in the United States and Canada, regardless of vaccination status, returned to our offices in October 2021.

Similar to our efforts in North America, we also undertook efforts to return our employees in Europe and Asia to their offices, subject to local laws and regulations.

In November 2021, a majority of our employees outside of North America returned to the office full-time.

The spread of the Omicron variant around the world in December 2021 caused us to further modify our in-office environment.

First, we mandated that all U.S.

employees receive a COVID-19 booster vaccine no later than six weeks after first becoming eligible for such vaccine.

Second, we mandated that all US employees provide proof of vaccination to us.

Third, for offices around the world that had not been closed by government order, we shifted much of our workforce to a fully remote status at the end of 2021 in order to reduce the density of our offices.

Sales representatives with less than 12 months tenure, sales representative on performance improvement plans and their managers are currently still working in our offices on a full-time basis in the US, as we believe that the training and coaching required by new sales representatives is significantly more effective when provided in an in-office environment.

Sales and Marketing

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Our sales personnel work through direct contact with potential customers in, or intending to locate in, our on-net buildings.

Through agreements with building owners, we are able to initiate and maintain personal contact with our customers by staging various promotional and social events in our multi-tenant office buildings and carrier neutral data centers.

Through agreements with building owners, we are able to initiate and maintain personal contact with our customers by staging various promotional and social events in our MTOBs and CNDCs.

Sales personnel are compensated with a base salary plus quota-based commissions and incentives.

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We are also dependent on third-party providers, some of which compete with us, to provide intercity and intracity fiber as well as the lateral fiber connections required to add buildings to our network and to provide the local loop facilities for the provision of connections to our off-net customers.

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We believe that competition is based on many factors, including price, transmission speed, ease of access and use, length of time to provision service, breadth of service availability, reliability of service, customer support, billing simplicity and brand recognition.

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however, our network may not support some of the services supported by these legacy networks, such as circuit-switched voice, ATM, MPLS, frame relay, wireless and shared hybrid fiber coax networks.

While the Internet access speeds offered by traditional ISPs serving multi-tenant office buildings using DSL or cable modems typically do not match our on-net offerings in terms of throughput or quality, these slower services are usually priced lower than our offerings and thus provide competitive pressure on pricing, particularly for more price-sensitive customers.

These and other downward pricing pressures particularly in carrier neutral data centers have diminished, and may further diminish, the competitive advantages that we have enjoyed as the result of the pricing of our services.

While the Internet access speeds offered by traditional ISPs serving MTOBs using DSL or cable modems typically do not match our on-net offerings in terms of throughput or quality, these slower services are usually priced lower than our offerings and thus provide competitive pressure on pricing, particularly for more price-sensitive customers.

These and other downward pricing pressures particularly CNDCs have diminished, and may further diminish, the competitive advantages that we have enjoyed as the result of the pricing of our services.

Increasingly, traditional ISPs are upgrading their services using optical fiber and cable technology so that they can match our transmission speed and quality.

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Our services are subject to the regulatory authority of various agencies in the jurisdictions in which we operate.

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The extent of regulation can change.

For example, the U.S.

Federal Communications Commission (“FCC”) in 2017 rescinded regulations applicable to mass market Internet access providers.

For example, in 2017, the U.S.

Federal Communications Commission (“FCC”) rescinded regulations applicable to mass market Internet access providers.

In all jurisdictions regulations continue to evolve.

We also enter into new markets with their own regulations.

The regulations with which we need to comply include obtaining the proper licenses to provide our services, data privacy, interception of communications by law enforcement, blocking of websites, and other regulations.

The regulations with which we need to comply include obtaining the proper licenses to provide our services, data privacy, and interception of communications by law enforcement, blocking of websites, net-neutrality in California and other states in the U.S.

and other regulations.

We believe that we comply with all regulations in the jurisdictions in which we operate.

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We make available free of charge through our Internet website our annual report on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, and any amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act.

The reports are made available through a link to the SEC’s Internet website at www.sec.gov .

The reports are also made available through a link to the SEC’s Internet website at www.sec.gov .

You can find these reports and request a copy of our Code of Conduct on our website at www.cogentco.com under the “About Cogent” tab at the “Investor Relations” link.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business