Virtela Hits Record Financial and Operational Milestones in 2007

Positive Cash Flow and Profits Drive Company Expansion and Momentum

DENVER, February 26, 2008 - Virtela, the global network solutions company, today announced it has achieved six consecutive quarters of positive net income and sustained positive cash flow for the last four quarters, or all of 2007. With more than 25% revenue growth year-over-year, Virtela's growth surpassed all of its top competitors.

As a hybrid Virtual Network Operator (VNO), Virtela enables customers to benefit from the best in-country network resources around the globe through a single source. Beyond offering the most extensive footprint through hundreds of network partners, Virtela's Global Service FabricSM infrastructure performs intelligent routing and dynamic failover across networks for optimal performance, security and resiliency. These unique capabilities insulate customers from network disruptions such as the undersea cable cuts in the Middle East and Africa last month, as recently highlighted in the press.

"Virtela's business model is taking flight," said Michael Suby, director of Stratecast (a division of Frost & Sullivan). "Strong year-over-year revenue growth plus consistent and widening levels of profitability in 2007 are key indicators of this. The company's virtual network footprint and ever-expanding portfolio of managed services tailored for geographically distributed businesses will continue to fuel future growth."

Virtela's product portfolio continues to diversify in 2008 to complement its core managed network services, which include remote access, security and IT infrastructure services. The company's WAN acceleration service, for example, has demonstrated significant traction, and adoption from key verticals such as manufacturing, business services and finance continues to climb. New lines of business, such as managed remote storage and Software as a Service (SaaS) enablement solutions, represent key opportunities for Virtela in 2008.

"With the combined strength of our business model, financial momentum and services expansion, Virtela is well-positioned to capture a greater share of the managed services market," said Bill Dodds, vice president of sales and marketing. "We expect our broad footprint and portfolio of tightly-integrated and attractively-priced enterprise managed services will gain further traction with customers and partners, whether they are interested in end-to-end solutions or plugging gaps in their current environments."

Contributing to Virtela's strong financial results in 2007 was continued record growth in sales through channel partners. New recurring revenue from channels in the Asia-Pacific region quadrupled, while new recurring revenue from channels in Europe doubled for the year. The company saw a year-over-year increase of nearly 40% in new customers served through channel partners.

"We have been very successful helping carriers, system integrators and VARs around the world fill gaps in both their geographical coverage and managed network and security services portfolios," said John Powell, Virtela's vice president of global channels. "By interconnecting with Virtela, our partners gain a competitive edge through access to the widest variety of suppliers and local access solutions, a unique multi-carrier backbone with 100% availability, and a host of advanced services delivered in the network cloud for excellent economies of scale."

Building off its proven success model in Asia Pacific and Europe, Virtela is replicating its strategy in the Middle East and Latin America throughout 2008, including expansion of Regional Policy Centers (RPCs) to better serve customers and partners operating in those geographies.

Virtela's leadership is rooted not only in its financial success and thriving global expansion, but also in the strength and quality of its operations. Notable benchmarks in 2007 include:

  • Global Operations Center Expansion: Virtela opened a new operations center in Manila, joining centers in Denver and Mumbai to provide enhanced follow-the-sun coverage.
  • Proactive Troubleshooting: 98% of Virtela's trouble tickets are opened proactively, with Virtela notifying the customer of an issue, often already resolved.
  • First-Touch Resolution: Calls to Virtela's Global Operations Centers are answered by engineers who will likely resolve the issue, eliminating the call-back promises, wait time and pass-offs between support personnel that have become commonplace in the industry. Average call answer time is only 29 seconds.
  • Superior Mean Time to Restore (MTTR): Virtela's MTTR average is 1.86 hours, less than half of the company's 4-hour MTTR service guarantee.
  • Timely Provisioning: Virtela has an industry-leading 95% success rate for meeting or beating its published provisioning timeframes for every location worldwide.
  • Highly-Efficient Internal Systems: Virtela places local loop orders within 72 hours of customer order receipt, compared to two to four weeks for typical carriers.
  • Real-Time Pricing Database: Virtela's sophisticated back-end systems enable automated delivery of accurate price quotes, as opposed to budgetary pricing typically offered by competitors. Backed by superior operations, unmatched customer care, and a unique model that enables greater agility in responding to market and technology changes, Virtela is leading the charge in providing sophisticated, efficient and business-critical managed services worldwide.

About Virtela

Virtela, the world's largest independent managed services company, offers award-winning managed services including MPLS and IP-based Virtual Private Networks (VPNs), Security, Remote Access, and WAN/LAN Device Monitoring and Management, to some of the most competitive multinational companies in the world. Offering services in 190 countries, Virtela integrates and manages best-of-breed service providers through partnerships with 500+ carriers, to address the unique needs of its customers. Virtela is headquartered in Denver, Colorado, with Global Network Operations Centers in Denver, Mumbai, India and Manila, Philippines. For more information, please call +1 (720) 475-4000 or visit www.virtela.net.

Media Contact:
Jane Morrissey
Virtela
720.475.4012 (office)
303.808.7671 (mobile)
jmorrissey@virtela.com

Susan Wise
Greenough Communications
(650) 646-3268 x11
swise@greenoughcom.com