VG
#Yes, so our, this is <UNK> again.
Our strategy is an Omni channel strategy.
We have four channels.
So inside sales, which is, you know, tele sales and we have our own W-2 employees, our own W-2 salespeople, that's our direct field sales force.
Then we have the channel managers who work with the master agents and the sub agents throughout North America, and then we have <UNK>'s enterprise channel.
You know, as I said in my prepared remarks, we want to sell, you know, the right product to the right customer through the appropriate channel.
And you're going to sell your SMB down to your micro-businesses through your tele sales channel because that's the most effective way to reach those with a, you know, an appropriate acquisition cost.
And the enterprise, obviously, services enterprise and the direct field group and the channel is really focused mostly in mid-market up to small enterprise.
From a growth point of view, the size of the direct field group is already, well, bigger than that 90 to 100 that you mentioned.
We are presently in nine cities with separate sales offices.
We think about the expansion strategy.
We use the term NFL's cities strategy.
There are 32 NFL cities.
Again, it doesn't necessarily have to be a NFL theme there but you get the idea that we're going after the large cities.
So today we have sales offices in Chicago, New York, Philly, Washington, Atlanta, Dallas, Houston, Denver, Phoenix.
And we're expanding in every direction to have a direct field presence in all the major markets throughout the country.
And we're going to do that organically and in-organically.
Again, because we just can't get there fast enough organically, and there are opportunities to buy others of these BroadSoft service providers in these other markets.
And we're going to be very active with that this year.
Yes, that will be reflected in costs.
It's going to take throughout the year to do that.
I mean, we're cutting our data center footprint, and this is separate and apart from our POPs, our termination POPs.
We're cutting our data center footprint in, more than half.
So you're not going to see a significant impact to margins in 2016, but in 2017 you should see a material difference, which we'll clarify as we execute that change.
Thank you.
So right now, we're not operating the company towards a target leverage.
We're letting the leverage, up to a cap of what's available at a reasonable coupon, within that, we're letting our M&A and other capital allocation, buyback and organic growth strategy, drive that.
I think that the current bank loan, as I said, enables us to go up to 2.75 times, you know, I think we're comfortable running the company at 2.75.
I think we'd be comfortable running it at three.
I think when you start to get above that, you know, it's less about target leverage and it's more about cost of debt.
I think when you cross into high yield land, you know, there's a disproportionately higher cost of debt at that point.
So at three times, I think we're prepared to let the strategy drive that, and once we're through this acquisition push, that we're making now, you know, it will be more about fine tuning what the target is.
Great.
Thanks.
And thank you to everyone for joining us today.
We appreciate your support of Vonage and look forward to speaking to you throughout the quarter as well as again next quarter.
Thank you.
