Enom 2013 Annual Report Download - page 107

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16. Business Segments
We operate in one operating segment. Our chief operating decision maker (“CODM”) manages our operations on a consolidated basis for
purposes of evaluating financial performance and allocating resources. The CODM reviews separate revenue information for its Content &
Media and Registrar offerings. All other financial information is reviewed by the CODM on a consolidated basis. All of the Company’
s principal
operations are located in the United States. Revenue generated outside of the United States is not material for any of the periods presented.
Revenue derived from the Company’s Content & Media and Registrar Services is as follows (in thousands):
17. Concentrations
Concentration of the Cost of Registered Names
A significant portion of the payments for the cost of registered names and prepaid registration fees were made to a single domain name
registry, which is accredited by ICANN to be the exclusive registry for certain TLD’s. Payment to this registry accounted for approximately
83%, 82% and 80%, of payments for the cost of registered names and prepaid registration fees for the years ended December 31, 2013, 2012 and
2011, respectively. The failure of this registry to perform its operations may cause significant short-term disruption to our domain registration
business.
Concentrations of Credit and Business Risk
Financial instruments that potentially subject us to a concentration of credit risk consist of cash and cash equivalents, marketable
securities and accounts receivable.
At December 31, 2013 and 2012, o ur cash and cash equivalents and marketable securities were maintained primarily with three major
U.S. financial institutions and four foreign banks. We also have used one Internet payment processor in both periods. Deposits with these
institutions at times exceed the federally insured limits, which potentially subject us to concentration of credit risk. We have not experienced any
losses related to these balances and believe that there is minimal risk.
A substantial portion of our advertising revenue is generated through arrangements with one advertising network partner. We may not be
successful in renewing any of these agreements, or if they are renewed, they may not be on terms as favorable as current agreements. We may
not be successful in renewing our agreements with advertising network partners on commercially acceptable terms.
The percentage of revenue generated through advertising network partners representing more than 10% of consolidated revenue is as
follows:
Advertising network partners comprising more than 10% of the consolidated accounts receivable balance was as follows:
F-31
Year ended December 31,
2013
2012
2011
Content & Media revenue:
Owned & operated
$
195,546
$
178,511
$
157,089
Network
50,851
67,888
48,361
Total Content & Media revenue
246,397
246,399
205,450
Registrar revenue
148,201
134,179
119,416
Total revenue
$
394,598
$
380,578
$
324,866
Year ended December 31,
2013
2012
2011
Google
34
%
38
%
33
%
Year ended
December 31,
2013
2012
Google
27
%
26
%