Global Crossing Receives Frost & Sullivan's 2005 Growth Strategy Leadership Award

Frost & Sullivan, a global growth consulting company that serves emerging and global 1,000 companies along with the investment community, has recognized Global Crossing with its prestigious 2005 Growth Strategy Leadership Award. This industry distinction was awarded to Global Crossing for its focused business strategy and precision execution.

“Global Crossing’s success in the execution of its strategy demonstrates the importance of a finely-tuned, focused plan for carving out a strong competitive position in the industry,” said Lucy Liu, Frost & Sullivan analyst. “Global Crossing’s innovation in converged IP services, expansion into the global enterprise market and improving financials are all proof that the company is building momentum and creating a solid foundation for future success.”

Global Crossing’s strategy is focused on delivering converged IP services to global enterprises, which the company is ideally positioned to serve through both direct and indirect channels. The underlying foundation of this strategy is the company’s focus on improving margins and realizing growth opportunities. Three principal areas of business activity delineated as part of this concentration are categorized as follows:

• “Invest and grow” – Core lines of business, including enterprise, collaboration, indirect channels and carrier data.
• “Manage for margin” – Areas of business, such as wholesale voice, which the company selectively manages for margin and cash flow.
• “Harvest or exit” — Those areas of the business that Global Crossing will exit or de-emphasize, including its Small Business Group and Trader Voice units, both of which were sold in the first half of the year.

“This award, backed by solid financial results achieved over the last three quarters, validates our current strategy and shows we are determined to succeed in a rapidly changing marketplace,” said John Legere, Global Crossing’s chief executive officer. “We appreciate Frost & Sullivan’s recognition of our strategic leadership in the telecommunications industry.”

Since the announcement in October 2004 of its tightened focus on the three areas of business described above, Global Crossing has shown consistent execution of its strategy. Its success is confirmed by the company’s ten-point improvement in gross margin — from 28 percent in the second quarter of 2004 to 38 percent in the second quarter of 2005 – as well as sustained growth in its “invest and grow” revenue.

“Converged IP services are at the core of Global Crossing’s product strategy and vision,” continued Lucy Liu. “What truly distinguishes Global Crossing’s approach is the flexible and responsive manner in which it customizes solutions to meet individual customer needs, transitioning them onto IP-based platforms at a pace that supports their specific business objectives.”