Juno 2014 Annual Report Download - page 42

Table of Contents
networking services. Our Communications and Content & Media services revenues are primarily dependent on two factors: the average number of pay
accounts for a period and ARPU. In general, we charge our pay accounts in advance of providing a service, which results in the deferral of services revenue to
the period in which the services are provided. Communications services revenues also include revenues generated from the resale of telecommunications to
third parties.
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Communications products revenues consist of revenues generated from the sale of mobile broadband devices to our mobile broadband customers and to
our retail partners and from the sale of mobile phones, as well as the related shipping and handling fees. Content & Media products revenues consist of
revenues generated from the sale of yearbooks and yearbook reprints, including the related shipping and handling fees, and from reselling third-party
merchandise.
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Our Communications services generate advertising revenues from search placements, display advertisements and online market research associated with
our Internet access and email services. Advertising revenues also include intercompany commissions from the Content & Media segment which are included
in reported segment results and are eliminated upon consolidation.
We provide advertising opportunities to marketers with both brand and direct response objectives through a full suite of display, search, email, and text-
link opportunities across our various properties. Our social networking services generate advertising revenues primarily from display advertisements on our
websites. Advertising inventory on our social networking websites includes text and graphic placements on the user home page, profile page, class list page,
and most other pages on our websites. Our loyalty marketing service's advertising and other revenues are derived from advertising fees, consisting primarily
of fees based on performance measures, that are generated when emails are transmitted to members, when members respond to emails, when members
complete online transactions, and when members engage in a variety of other online activities, including, but not limited to, games, Internet searches and
market research surveys. Our loyalty marketing service's advertising and other revenues also include revenues generated from the sale of gift cards.
Cost of Revenues
Communications cost of revenues includes telecommunications and data center costs; personnel and overhead-related costs associated with operating
our networks and data centers; depreciation of network computers and equipment; license fees; costs related to providing customer support; costs related to
customer billing and billing support for our pay accounts; fees associated with the storage and processing of customer credit cards and associated bank fees;
domain name registration fees; and the costs associated with the sale of mobile broadband devices and mobile phones, including the related shipping and
handling costs.
Content & Media cost of revenues includes costs of points earned by members of our loyalty marketing service; costs related to the sale of gift cards;
depreciation of network computers and equipment; data center costs; amortization of content purchases; fees associated with the storage and processing of
customer credit cards and associated bank fees; costs related to providing customer support; personnel and overhead-related costs; costs related to third-party
merchandise; costs associated with the sale of yearbooks and yearbook reprints, including the related shipping and handling costs; license fees; and domain
name registration fees.
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