Natalie Temple - Paul L. Sagan - Chief Executive Officer and Executive Director J. D. Sherman - Chief Financial Officer, Principal Accounting Officer and Senior Vice President

Rodney W. Ratliff - SunTrust Robinson Humphrey, Inc., Research Division Donna Jaegers - D.A. Davidson & Co., Research Division Mark S. Mahaney - Citigroup Inc, Research Division Tim Klasell - Stifel, Nicolaus & Co., Inc., Research Division Michael J. Olson - Piper Jaffray Companies, Research Division Lauren Choi Edward Maguire - Credit Agricole Securities (USA) Inc., Research Division Chad Bartley - Pacific Crest Securities, Inc., Research Division Sameet Sinha - B. Riley & Co., LLC, Research Division Daniel Morrison - Crédit Suisse AG, Research Division Michael Turits - Raymond James & Associates, Inc., Research Division Richard Fetyko - Janney Montgomery Scott LLC, Research Division Scott H. Kessler - S&P Equity Research Mark Kelleher - Dougherty & Company LLC, Research Division Jeffrey Van Rhee - Craig-Hallum Capital Group LLC, Research Division Ben Z. Rose - Battle Road Research Ltd. Aaron Schwartz - Jefferies & Company, Inc., Research Division Rob Sanderson - American Technology Research Jennifer A. Swanson - Morgan Stanley, Research Division

Good day, ladies and gentlemen, and welcome to the Akamai Technologies Earnings Conference Call. My name is Derek, and I'll be your operator for today. [Operator Instructions] As a reminder, this conference is being recorder for replay purposes. I would now like to turn the conference over to Ms. Natalie Temple, Investor Relations. You may proceed.

Good afternoon, and thank you for joining Akamai's investor conference call to discuss our third quarter 2011 financial results. Speaking today will be Paul Sagan, Akamai's President and Chief Executive Officer; and J.D. Sherman, Akamai's Chief Financial Officer. Before we get started, please note that today's comments include forward-looking statements, including statements regarding revenue and earnings guidance. These forward-looking statements are subject to risks and uncertainties, and involve a number of factors that could cause actual results to differ materially from those expressed or implied by such statements. Additional information concerning these factors is contained in Akamai's filings with the SEC, including our annual report on Form 10-K and quarterly reports on Form 10-Q. The forward-looking statements included in this call represent the company's view on October 26, 2011. Akamai disclaims any obligation to update these statements to reflect future events or circumstances. As a reminder, we will be referring to some non-GAAP financial metrics during today's call. A detailed reconciliation of GAAP and non-GAAP metrics can be found under the News & Events portion of the Investor Relations section of our website. Now let me turn the call over to Paul. Paul L. Sagan: Thanks, Natalie, and thank you, all, for joining us today. Akamai performed very well in Q3, with revenue of $282 million, up 11% from the same period last year. We generated fully taxed normalized net income of $63 million or $0.34 per diluted share, consistent with Q3 of last year. Cash flow generation continued to be very strong, allowing us to accelerate our share repurchases in the third quarter under our expanded buyback program. We generated $160 million in cash from operations in the quarter, with $317 million year-to-date. I'll be back in a few minutes to talk about some of the highlights from our recent worldwide customer conference in Boston, including advancements to the Akamai platform that we announced during the event. But first, let me turn the call over to J.D. for details on Q3. J.D.? J. D. Sherman: Thanks, Paul. I'm glad you straightened out it's the A-K-A-M-Y conference call rather than the A-K-A-M-I conference call. Paul L. Sagan: I'm glad I'm in the right place. J. D. Sherman: As Paul just highlighted, our revenue came in at the high end of our guidance range at $281.9 million. That's up 11% year-over-year, and up $5 million sequentially. During Q3, we saw continued solid growth for our value-added solutions. Enterprise was our fastest growing vertical, grew 30% year-over-year and 3% sequentially, as our customers shifted more content and applications to the cloud. Our commerce vertical increased 23% over Q3 of last year and increased 5% sequentially. These results were driven by continued demand for our Dynamic Site Acceleration solutions, or DSA, as well as solid early traction for our security portfolio. We had almost 100 DSAs signings in the quarter across all of our verticals, and that's just shy of the record signings we saw in Q2. In addition, we had over 30 customers adopt our security solutions in Q3. In less than a year of general availability, we already have over 125 customers leveraging our security solutions in the cloud. Revenue from our media and entertainment customers grew 5% year-over-year, and grew 1% sequentially in the third quarter. We continue to see consistent traffic growth, but we still have yet to see year-over-year traffic growth begin to accelerate again. The high tech vertical was up 3% year-over-year and flat on a sequential basis. Software-as-a-Service customers continue to drive growth with their adoption of our application performance solutions, offsetting continued pressure on the software downloads revenue. Public sector revenue grew 5% year-over-year and declined 1 point sequentially. During the third quarter, sales outside North America were 29% of total revenue. That's down 1 point from the prior quarter. International revenue grew 15% year-over-year and declined 1 point sequentially in Q3. Foreign exchange had a slight negative sequential impact. And on a year-over-year basis, the currency impact was favorable by about $6.5 million, about $1 million less of a benefit than we anticipated at the time of our last earnings call. Excluding the impact of currency, international revenue grew 6% on a year-over-year basis. The macro environment in Europe and Japan continue to weigh on our results, but we saw strong growth in our other international markets, especially in emerging markets. Revenue from North America grew 10% on a year-over-year basis and 3% sequentially. And resellers represented 19% of our revenue, consistent with the prior quarter. Our cash gross margin for the quarter was 79%, down 1 point from last quarter as expected and down 2 points for the same period last year. GAAP gross margin, which includes both depreciation and stock-based compensation, was 67% for the quarter, also down 1 point from the prior quarter and 2 points from last year. GAAP operating expenses were $123.2 million in the third quarter. These GAAP numbers include depreciation, amortization of intangible assets and stock-based compensation. Excluding noncash charges, our operating expenses for the quarter were $100 million. That's up $5 million from Q2 and up 10% on a year-over-year basis. Adjusted EBITDA for the third quarter was $122.4 million. That's up 7% from the same period last year and down about 3% from Q2 levels. Our adjusted EBITDA margin came in at 43%, as we expected, net down 2 points from the same period last year and 3 points from the prior quarter. For the third quarter, total depreciation and amortization was $41.8 million. These charges include $33.2 million of network-related depreciation, $4.4 million of G&A depreciation and $4.2 million of amortization of intangible assets. Net interest income for the third quarter was $3 million, roughly flat with second quarter levels and with Q3 of last year. Moving on to earnings, GAAP net income for the quarter was $42.3 million, or $0.23 of earnings per diluted share. As a reminder, our GAAP net income includes several primarily noncash items, including $16.7 million of stock-based compensation, including amortization of capitalized equity-based compensation and $4.2 million from amortization of acquired intangible assets. We're including GAAP taxes in our normalized earnings, and that tax charge was $25.9 million, based on a full year GAAP tax rate estimate of 36%. This tax rate is slightly higher for the year than the 35% we estimated last quarter, based on our current view of the revenue mix between U.S. and international, partly due to currency changes. Our normalized net income for the third quarter was $63.4 million, down 1% from Q3 of last year and 4% from Q2 of this year. In the third quarter, we earned $0.34 per diluted share on a normalized basis. That's at the high end of our guidance range, consistent with Q3 of last year and down $0.01 from Q2. Our weighted average diluted share count for the third quarter was 185.7 million shares. Cash generation continue to be strong, with cash from operations for the third quarter at $116 million. Year-to-date, we generated $317 million in cash from operations. At the end of Q3, we had $1.2 billion in cash, cash equivalents and marketable securities on the balance sheet. This is a slightly lower cash balance than last quarter, as we leveraged our cash to buy back a significant amount of shares in Q3. During the quarter, we spent $155 million in share repurchases, buying back just under 7 million shares at an average price of about $22.75. Capital expenditures, excluding equity compensation, were $47 million, below our forecast coming into the quarter, due to the timing of investment. This number includes both investment in our network, as well as capitalized software development. And finally, days sales outstanding for the quarter were 58 days. We delivered solid results this quarter with strong signings and continued traction with our cloud solutions. Online video growth still remain slightly below the expectations we had at the beginning of the year, but we have seen some positive signs as we head into Q4. The fourth quarter is generally our strongest seasonal quarter, driven by online retail and advertising, as well as seasonal traffic growth from media and entertainment. And despite some of the growing macro economic uncertainty, we are expecting a solid Q4 with revenues of $303 million to $315 million, up 8% to 12% sequentially, and up 6% to 11% on a year-over-year basis. The strength of the online retail and advertising season will be the main determinant of where we land in that range. At current spot rates, foreign exchange should have a negative impact of about $1.5 million on a sequential basis and about a $2 million benefit on a year-to-year basis, which is a much smaller benefit than we've seen over the past few quarters. We expect cash gross margins to remain flat sequentially, and GAAP gross margins to be flat to slightly higher than Q3 levels. We expect Q4 operating expenses to increase by about $10 million from the prior quarter, driven by the typical year-end expense items. Adjusted EBITDA margins should come in at about 43% to 44%, flat to slightly up from Q3 levels. We expect normalized EPS for the quarter of $0.37 to $0.41. This includes the tax charge of $25 million to $30 million, based on a full year GAAP tax rate of 36%. This also reflects a fully diluted share count in the range of 180 million to 182 million shares. On CapEx, we expect to spend about $50 million in the quarter, excluding equity compensation. This will put our full year CapEx right around 16% of revenue. I know that many of you would like to handicap next year's outlook at this point. But while we're excited about 2012, we are not going to give guidance beyond the current quarter. We're pleased with our solid Q3, and we're looking forward to a seasonally strong Q4. We think our results in the field, as well as the partnerships and new products we've announced, can help drive our growth into 2012. Now let me turn it back over to Paul. Paul L. Sagan: Thanks, J.D. We held our fourth annual Akamai Edge Customer Conference in Boston earlier this month. And I left more optimistic than ever about the future of our industry and our company. We were honored to host over 500 customers from 30 countries and many of the most important partners from our growing ecosystem. These are some of the most innovative companies in the world, and it's exciting to see how they are leveraging the Akamai platform to build their online businesses. Today's enterprises are operating in a world where consumers and workers no longer go online. They simply are online. We're living and working in a hyper-connected word, and it's changing the way the organizations interact with nearly everyone. Having 24 by 7 connectivity is just table stakes, and downtime is not an option. Access must be instant and reliable. There's no pause button for our clients. This may sound like a daunting environment for businesses, but we see it as an unprecedented opportunity, and so do our customers. The emergence of cloud computing is a prime example how organizations are adapting to this hyper-connected world. Cloud computing offers on-demand access to content and applications from anywhere, anytime, as well as cost advantages. It also has some serious issues in the form of security threats and performance limitations. Akamai is helping to address these challenges. We've partnered with cloud providers to make it easier for them to offer Akamai acceleration, Akamai optimization and Akamai security capabilities. For example, over 100 SaaS companies now power their applications using the Akamai platform. And in total, our platform supports the delivery and acceleration of tens of thousands of applications every day. We're also developing exciting technology that allows customers to bring Akamai intelligence into their private clouds, their networks and data centers, places it's never been before. This technology enables Akamai's applications to flow seamlessly, from the corporate data center, out to the public cloud and all the way to the end-user. As an example, we're very excited to announce that our first joint solution with Riverbed will be made available in beta next week. We demonstrated this solution at our customer conference, and the response was tremendous. Naturally, mobility is the driving force behind the hyper-connected world. Advances in mobile technology are changing the expectations of consumers and business users alike. Demand for instant access to dynamic and personalized content and applications are now the norm. Many Akamai platform delivers hundreds of terabytes of content each day to mobile devices from basically the 0 just 5 years ago. Said another way, the amount of mobile traffic we deliver today is greater than the total amount of daily traffic back in 2004. And even so, mobile connectivity and usage are still in their very early stages. We're working to provide our customers with a tool to harness the power of mobility and the flexibility to quickly react to the next new thing in mobile. So one example we're very excited about our first joint solution with Ericsson, called mobile cloud accelerator, which we expect to be available in some markets by the middle of next year. This is the world's first end-to-end solution that includes presence inside a mobile operator network, enabling optimized delivery across the Internet and the mobile network. And while we're all truly excited by the promise of today's hyper-connected world, it poses risks. Denial of service, or DDoS attacks are larger than ever, and the threats are becoming more and more sophisticated. With more than 12 years of experience protecting our customers from DDoS attacks, Akamai has always taken these risks very seriously. As J.D. mentioned, already, over 125 customers have adopted our security solutions to make conducting business in the cloud safer. And we continue to innovate in this space with the recent announcements of our DDoS defender compliance management solutions for example. The hyper-connected world is changing the face of media and entertainment as well. Today, video consumption happens on many devices and needs to be available everywhere, on your TV, of course, but also on your smartphone or tablet, seamlessly, and should be in HD. Our technology is helping our clients make this work. With over 500 customers leveraging the Akamai HD Network today, managing and delivering HD content to multiple device types around the world. Importantly, our scale and our unique software platform give us the ability to help our customers drive down their costs, a key to the success of their business models, as more and more premium content shifts online. We achieve this, in part, through our strong network relationships. We now have partnerships with over 1,000 networks across 75 countries, both at all-time highs. Our goal is to continue to build on these partnerships by developing more Akamai technology to help our network partners optimize their infrastructure to meet the needs of their users. It's also important to remember that innovation isn't just about technology and engineering, although those are critical. It's also about how we support and respond to our customers' needs. And we were thrilled to have the opportunity at the Akamai Edge Conference to listen to so many of our customers at once, to understand even more about where their businesses are headed and the challenges they're facing. Of course, we're also looking forward to talking more about what's happening here at Akamai with you at our Investor Conference Day in December. Now before we take your questions, some notes about the executive changes. First, this afternoon, we announced the departure of David Kenny from our Board and management team. David has been an advocate for innovation at Akamai, and I'm grateful to him for his contribution as an executive and a Board member. He is a great supporter of Akamai and our team. Now he wants to pursue his passion for opportunity in the consumer Internet marketplace, and we wish David well. Also today, I'm very pleased to announce 2 senior executive appointments. First, Rick McConnell is joining us as Executive Vice President of Products and Development. Rick comes to us from Cisco, where he held key roles in development, product management, strategy and sales. Second, Kumud Kalia joined us this month as Chief Information Officer. Most recently, Kumud was at CIO at Direct Energy and he has extensive experience in IT in the energy, telecommunications and financial services sectors. There's more on their backgrounds in the releases we issued this afternoon. But suffice it to say, that we're thrilled by their decisions to join Akamai. Now J.D. and I will take your questions. Operator, the first question please?

[Operator Instructions] Our first question is coming from the line of Mark Mahaney from Citi. Mark S. Mahaney - Citigroup Inc, Research Division: A question has to do for Paul on online video growth and your comment about it being below expectations. And could you just step back on your thoughts on what's happening out there that would cause that growth to be below expectations? Is it something about consumers? Is it something about the lack of ad support, business models around it? What's causing that to be slower? and what's going to cause that to reaccelerate, do you think? Paul L. Sagan: Sure. Well, it is growing. And again, every time this comes up, I think, people think we say it shrank. That's not the case at all. And really, J.D.'s comment was about our expectations a year ago and what we've seen play out. We're still seeing growth in that sector. I think the big question is really the business models and how much content gets licensed and put online. The success of things like over-the-top model, TV Everywhere. And I think we're seeing them grow slowly. We're seeing some examples of the sites and models that are working. But we haven't seen that full next inflection point that simply says, the dam's broken and TV has moved fully to IPTV. We continue to see more and more content going online, more and more usage. And frankly, more and more business models from subscription to purchase to rent and download, or ad supported, both in live and on-demand. And I think we're going to continue to see growth. I think the next inflection point comes from some real changes in both the monetization models, but really the willingness of the content providers to move more content, more hit content online faster. And simply old libraries isn't going to drive that inflection point. It's the newer material, the new hits going online faster, or simultaneous with television or other outlets, or other distribution channels that will drive that market.

Your next question is coming from the line of Michael Turits from Raymond James. Michael Turits - Raymond James & Associates, Inc., Research Division: It looks like media came in about in line with the least what the street was looking for. The upside seems to have come from the commerce and enterprise verticals. So first, it's a housekeeping, I'm sorry, I may have missed it. Did you give the value-added services breakout or growth rate? And also, what really drove you to the upper-end of your guidance based on the success in that subset -- in that sub segment? J. D. Sherman: Yes, actually, I don't think we gave it in the prepared remarks. But the value-added solutions are right around 58%, so rounding to 58%. Obviously, growing faster than the volume solutions, which were basically flat on a quarter-over-quarter basis. The value-added solutions grew 18% or 19%. As far as what drove us to the high-end of the range, I don't think it was one -- any one particular thing. We definitely are seeing strong signings with the value-added solutions. And as you know, with the signings model, the revenue builds from that. And we got a benefit from that. But I don't think there was one -- any one particular thing. Actually, currency went the other way and kept us from being at the very top-end of the range. But I think it was fairly broad-based. Paul L. Sagan: And I think it was enterprise and commerce were very strong, and we were very pleased by that. We were always a little cautious because of the macro environment. But so far, outside of a few pockets around the world, things seem to be hanging in at least among enterprises serious about moving online. They're still going there, and that really drove good performance, Michael. Michael Turits - Raymond James & Associates, Inc., Research Division: Right. The -- did DSA, which had showed -- it seems have been showing some slowing in the growth rate. Did that stabilize or reaccelerate? Or is -- is it that or some newer services that are starting to have a material contribution? Paul L. Sagan: Both DSA did well. I think J.D. referred to about 100 signings in the quarter, which was very strong with very good deals in lots of regions. And then strong uptake of security solutions of, at least, one of those going to many customers as well. So it's really, I think, what you see the power of the platform, not of a point solution of customers saying, give me a platform where I can add more functionality as my business needs it and layer on value, and give me one place to manage this connection between the private cloud, the public cloud and my end-users on any device, on any network, anywhere. And there's tremendous power in that. I think we're seeing that really help drive the business.

Your next question is coming from the line of Mark Kelleher from Dougherty & Company. Mark Kelleher - Dougherty & Company LLC, Research Division: J.D., just a quick question off the top. Did you give out the cash gross margin number? Sorry, I missed that. J. D. Sherman: Yes, we did. It was 79%. Mark Kelleher - Dougherty & Company LLC, Research Division: And the question I had was with the competition coming from the carriers, are you finding that it's getting more difficult to maintain equipment within the edge of the network, within the ISP facilities? Is that becoming an issue for you? Paul L. Sagan: No, I think I would bring you back to the numbers we gave out. We have record number partnerships, both with networks and geographic reach. We're in more countries than ever, we passed the 1,000 network mark. And we'd hovered just below that for a long time. So no -- we see that networks need our help with the flood of content and applications needing delivery is huge, and they see the value of embedding Akamai inside. And it would really go back to that premise we've talked about for 13 years, which is if you look at the distribution of over 10,000 ISPs around the world, none of them have very large share of data delivery. The largest player have single-digit share of global Internet data delivery. So if you are a Web business, you need a solution that's across network and across geography, and that's what we provide. And then by delivering inside these partner networks, we not only obviously, get a benefit for us, but we save them operating expense. And we make their network look like a better way to get on the Internet to their customers for the end users, whether they're businesses or consumers. So it's really a win-win-win relationship between us, our customers and the networks. Our ability to bring technology, our customers' need to reach end users and the network's need to deliver on the last mile efficiently. And so we're seeing actually greater opportunity, wider distribution now into more than 1,000 partner networks and very interesting conversations with those network who were saying what else could you do to help us be more efficient and maybe even be able to sell value-added services in their market to help their customers. So we think there is just increasing opportunities for us, and we're putting a lot of effort into -- to doing that to raise the level of our partnerships. And I think we're starting to see that pay off already, Mark.

Your next question is coming from the line of Scott Kessler for S&P Capital IQ. Scott H. Kessler - S&P Equity Research: So 2 quick questions. The first is, is there any thought to adding a new executive in the president role? Or, Paul, are you going to continue on in that capacity for some time? And then I have another question. Paul L. Sagan: No. I kept the old business cards, and I got a big box of them, and I pulled them out already. J. D. Sherman: Which is good because I wasn't letting him buy any new ones. Paul L. Sagan: There you go. So no, I'm happy to do it. What I've always looked for is do have the right team on the field? And you see the 2 people we added today, very experienced, execution-oriented executives. I'm very comfortable with the team that they have the bandwidth to execute on what we need, and I'm very pleased. Scott H. Kessler - S&P Equity Research: Okay, great. And the second question I had is you had an entire section of your press release dedicated to the share repurchase activity. I'm wondering how much capacity, dry powder, so to speak, you guys have in your current authorization? J. D. Sherman: Yes, Scott. We've got additional authorization from the Board of about $400 million back in the July time frame. We have just over $200 million of that authorization still out there. And obviously, with strong balance sheet, we think we'll be able to execute on that plan.

The next question is coming from the line of Ed Maguire from CLSA. Edward Maguire - Credit Agricole Securities (USA) Inc., Research Division: Could you discuss the sort of broader dynamics competitively on both the value-added services side, as well as the -- your traditional CDN side? And what trends you may be seeing just competitively in terms of pricing? Paul L. Sagan: It's really been very consistent environment. As you know, our -- we compete first with do-it-yourself. Our customers are very sophisticated technology operators, and they have the infrastructure, their CIOs are very skilled. And so we have to earn our seat at the table every day and demonstrate that the Internet maybe a narrow slice of their world, but it's very, very deep, and you need our kind of footprint, R&D technology development to really manage performance capacity, scale and security. And in fact, by using a distributed platform, like Akamai, you get lots of benefits for scale performance from security, stop threats, where they start no up at your backdoor. And then, of course, we have lots of direct competition. We always have had that. Large full-service operators try to say as one over-the-top model [ph]. We have all products, buy whatever you want from us and hold us accountable. That model has been for a long time. My guess is that it will continue to be. And then point solution providers usually small, generally private firms, who like to say we do one thing really, really well. We'll love you to death and we'll try to focus on you. And our point is no one has our breadth; no one has our scale or our focus on what we do. We can help the do-it-yourself model the corporation do better and off-load at a better price some of the challenges they have. We've partnered with many of the managed service providers and they just resell our services and we like that model a lot. And frankly, against the point of service providers, we compete everyday. And I think we do very, very well. So that dynamic is fairly consistent quarter in, quarter out

Your next question is coming from line of Jennifer Swanson from Morgan Stanley. Jennifer A. Swanson - Morgan Stanley, Research Division: I had -- first, I had a question just following up on the share repurchases question earlier. In the past, the posture has been we'll buy to offset dilution, but not really beyond that. Clearly, this quarter was a much more aggressive quarter on the repurchase front. You have strong cash flow generation and pretty significant balances. Just curious if there is sort of a thought of keeping up that more aggressive rate of repurchases going forward? And then I had another question. Paul L. Sagan: So I'll give you mine, and then J.D., the CFO, can give you his. First, it's under a 10b5 program. So it can go faster or slower based on the program. But we have been roughly offsetting dilution. We had fallen a bit behind. And so, in some ways, I think of it as catching up. Our main goal, remains in place and that's really the strategic objective. J.D.? J. D. Sherman: Yes, although, clearly, we went out got a larger authorization and executed on a larger share repurchase when the stock price went down, it made a lot of sense to us. And that's why you saw us get up, go back to the Board and ask for a larger program back in July. Jennifer A. Swanson - Morgan Stanley, Research Division: Okay, great. And the other question I had for Paul. You mentioned working with network partners, helping them improve delivery. Obviously, just having Akamai servers in their the network helps on that front. But there's been some chatter that Akamai might look to get more into the licensed CDN market and maybe provide more of a technology solution beyond what you've done traditionally. Is there anything that we should be thinking about there in terms of your intentions longer term, helping networks improve delivery outside of just working with Akamai in a service provider capacity? Paul L. Sagan: Sure. We think that's a real opportunity, and we're continuing to explore the best way to do that. We've talked about that some with industry analysts on the trends in that marketplace. And we think that, that is a direction for us to explore, to look to work directly with the networks also to embed our technology in other people's products. You see us doing that with IBM and Riverbed in one sense. We think there are lots of directions to take that. We want to do that in a focused, obviously long-term revenue -- profitable revenue generating way. But we think that because we're already there, we know how these networks work. In some cases, we think we may know routing there better than they do because we just have so much realtime data and the ability to manage it. And we're going to look at those options. As I'm sure you know, and some on the call may know, we do managed custom network deals for some people already. We talked about doing video inside certain wireless carriers for several years, so we think there are various ways we could take that technology both either as potentially licensed or as a managed offer to them.

The next question is coming from the line of Richard Fetyko from Janney Capital. Richard Fetyko - Janney Montgomery Scott LLC, Research Division: Just curious about the CapEx spend, both in the third quarter and the planned CapEx spend in the fourth quarter relative to your network capacity. Where you're spending in within the network? Are you adding more CapEx to the data centers of the edge of the networks? And considering the growth in the volume based business, how should we sort of correlate the CapEx spend versus the revenue growth from that business? J. D. Sherman: Yes. So I think we're going to end up right where we thought we would at the start of the year, which is at the high-end of our range of 13% to 16%. The biggest, the 2 drivers -- one, we are increasing significantly year-over-year the amount of capitalized software development in our CapEx. And that's driven by the new products and the new announcements that you're seeing and largely by the value-added solutions. So that's one impact on our CapEx spend. As far as capacity, our model is largely at the edge, as you know. And so a lot of our capacity is going in at the edge. We talked last quarter about a lot of the capacity going in outside of the U.S. where we see a lot of traffic growth in emerging markets. And other places outside of North America. So we are adding capacity out there. But I do think, as we have for the past, x number of years, we'll be able to manage the traffic growth within our long-term model.

Your next question is coming from the line of Philip Winslow from Crédit Suisse. Daniel Morrison - Crédit Suisse AG, Research Division: This is actually, Dan Morrison asking a question for Phil. Could you just touch briefly on your bandwidth and co-location costs? The trends over the past 6 months? And any significant changes? And then also, what we can expect moving forward? J. D. Sherman: Yes, not really any significant changes. Those input costs continue to go down in this business. They always have. We've talked about how co-location is the larger element than it has been in the past. And co-location is -- depends on your server footprint. And we manage that server footprint -- the benefits to that, you drive benefits with your software efficiency, with the way you use hardware. So we still think we're -- we think we're in a great position to keep driving our costs down and that helps our customers because it helps us drive their costs down. And most of the leverage we have benefit both co-lo and bandwidth, but in particular, the levers around effective hardware utilization and software efficiency are going to have going to help drive on the co-lo call.

Your next question is coming from the line of Aaron Schwartz from Jefferies. Aaron Schwartz - Jefferies & Company, Inc., Research Division: I just had a follow-up question on the video growth. I know on the last call, you sort of alluded to the fact that, that maybe was getting a little better as we got to a later part of the year. And I just wanted to see if that had continued a little bit? Or did that -- did this just not pick up sort of from the first half and maybe give us a -- put a little more color on to where you're at this time relative to 90 days ago? J. D. Sherman: Yes, I think we're still -- we're seeing consistent solid growth. We haven't seen, we've we talked about an inflection point and we really haven't seen that inflection point yet. Paul talked about some of the factors that we think come into play with that. I think it's more of a rate and pace question than anything else. But we have not seen a really large acceleration in that growth. I would say that the traffic growth has been relatively consistent. And as a result, we're seeing relatively stable revenue on the volume side. Aaron Schwartz - Jefferies & Company, Inc., Research Division: Okay. And then, as we look into Q4, obviously, you get some seasonal benefit there. But does the strength in the commerce sort of offset maybe that volume dynamic? Is that the best way to look at it? J. D. Sherman: Well, yes, I think Q4 tends to be the quarter where see that seasonality in your media and entertainment business as well. You get the -- sort of the people watch and consume more inside video entertainment in generally in Q4. So we'll see how that plays out. That's one of the drivers. But yes, it tends to be the commerce, what happens with the online commerce season tends to be the driver from the high-end to the low-end of our guidance range in the fourth quarter. Aaron Schwartz - Jefferies & Company, Inc., Research Division: Okay. And last question for me, if I could. But on the software development costs, in terms of -- I know you're not giving guidance for next year, but in terms of us building models. Are the expensing of those, is that dependent on a certain product release point? Or should those just slowly start to come on to the income statement? J. D. Sherman: Well, we capitalized software development when it's for new product development. And so that's obviously been increasing as we roll new products out. We amortize it over 2 years. So relatively rapidly, and its shows up through depreciation. So that's -- you'll factor that in. From a CapEx perspective, we're not going to give any specific guidance. We've given a long-term model of where we think that should be over time. And I think we'll be relatively consistent with that. But I think, to your specific question, depreciation starts when the project is complete and we announce it. We start delivering it to customers.

Your next question is coming from the line of Sterling Auty from JPMorgan.

This is Lauren Choi for Sterling. I wanted to see if you could give us a little more detail in terms of your comments in Japan and Europe? I think this is the second quarter you guys have talked about that. But I think I remember you talking about making some investments in Eastern Europe. Is the pricing dynamics and competitive dynamics different there? Or is it more of a volume issue? Paul L. Sagan: Well, just -- I think you've got a couple of things mixed together. So Eastern Europe is a new market. We don't expect much from that for a while. That will take time to develop. But we think it's a good spot to make some inroads. But there's not a big dynamic that's different, or it's certainly not a big market so it wouldn't affect the numbers. No, the comments we made about the softness we're in and specifically in 2 economies that were hit pretty hard this year. Japan, obviously, there's the softness there. We know the natural events that -- or tragedies that happened there that really threw business off. And in Europe, what we're really seeing is some softness in Southern Europe, and we've all been reading about the issues there. And I think that's been driving it. These businesses aren't at a stand still. They're just not growing as robustly. We've continued to make a disproportionate investment in Asia Pac, in the EMEA regions because we think long term, there's more opportunity there. There are bigger markets overall than North America. But they aren't where we're seeing as much return to that yet. That's fine, it takes a while to ramp up some of those investments anyway.

Okay. And just as a follow-up, could you just update us on, I guess, your hiring plans this -- in Q4 internationally and domestically? Paul L. Sagan: So we continue to hire and open positions. Always looking for great engineers and also great product people and sales as well. The competition for talent is really a tale of 2 cities. In our kind of business and technology, competition is vicious and unemployment rates are probably negative. Obviously, very different than other sectors. So it's a pretty strange place, in many ways, doesn't reflect the overall economy in Europe, parts of Asia or North America. But we continue to recruit and look to bring more people on. We don't it give a target headcount by the end of the year. But I think we'll just continue to recruit. And we're always looking for the best people.

Your next question is coming from the line of Mike Olson from Piper Jaffray. Michael J. Olson - Piper Jaffray Companies, Research Division: On dynamic site acceleration, you had a strong quarter with all the new customers signings. And can you just give us a flavor for kind of how saturated or not the market is for DSA? And what are some of the barriers to DSA not becoming as commoditized or as price-focused as the volume space? Paul L. Sagan: I think there's lots of opportunity both within some of our accounts today, where we haven't fully penetrated the opportunities, and there's more to do. And frankly, as our customers just move more applications online to IP, there's a big grow opportunity for us. And then I think in virtually every region, there's opportunity, both in country and across geographies for Dynamic Site Accelerator. I think what continues to differentiate it, frankly, is the value-added platform that it brings -- acceleration, security, scale, rich media and acceleration because most people have businesses that have -- whether they're B2B or B2C, even in B2B, rich media, often, is part of these applications. And they're looking for a platform that can provide all of these and a point solution that can do 1 or 2 things is really not what our customers want long term. It doesn't mean that they don't try some other things and use them. But they're looking for a comprehensive solution and they're looking for mobile as well and device adaptation and the ability to recognize the device and send the right content there with security and then reporting in the analytics back in scale in realtime. So I think as we wrap the things together on the Akamai platform, it allows us to grow our customers going forward, Mike. Michael J. Olson - Piper Jaffray Companies, Research Division: Okay. And then J.D., just a quick model question. Would you be willing to give us customer count at the end of the quarter? J. D. Sherman: Yes, I think -- was that not in the press release? I know we added like 120 customers, nearly 121 customers. So another really good overall signing quarter. And again, when we think about customer count, we haven't talk about, we don't emphasize it as a total business anymore. But what's really important is, that net customers, I should say net new customers -- after churn, which remain low. The signings that we really focus on are adding new customers on our value-added solutions and signs there have been very strong. We did mention that in the prepared remarks.

Your next question is coming from the line from Tim Klasell from Stifel Nicolaus. Tim Klasell - Stifel, Nicolaus & Co., Inc., Research Division: Just one quick question. Inside of the business vertical, you obviously have some volume business that's being somewhat of a headwind, and obviously, the SaaS guys are a tailwind. Can you give us sort of a feeling of maybe when the volume businesses going to become negligible headwind anymore? J. D. Sherman: Well, we've talked about the kind of inflection point that obviously drives it to a tailwind. I think one are the keys is it's now only about 40% of the business. And I think if that declines and there are 2 ways to do that. We're going to try to do it the good way, which is have the value-added site grow even faster. It becomes less and less of a tail wagger on the model. You can model the rate and pace of that based on your optimism about our ability to execute. And the overall macroeconomic side, I think that's what makes horse racing here for you to try to model that out. I think it's really a combination of the things that drive it faster and our ability just grow all these other aspects of the business. We've done that creating services that really didn't exist about 5 years ago. I think we've done a great job there innovating and our goal is to continue to do it across hybrid cloud and our ability to embed our technology in new areas across mobile, across security and video as well and drive the business forward. So I think you might have been talking just about the high-tech vertical, right? Tim Klasell - Stifel, Nicolaus & Co., Inc., Research Division: Yes, yes. Paul L. Sagan: Okay, so yes, that would just -- we had crossed over the 50-50 threshold there. More than 50% of revenue comes from value-added solutions. But it's still a 50-50. I think it'll be a while before it's 2/3, 1/3. That is clearly the direction that the software industry is going. But as I've said, I don't expect that to be the same. I don't expect to get the same growth rates from that vertical that we're seeing in Commerce and Enterprise for quite some time. Tim Klasell - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. Sorry for not being clear there... Paul L. Sagan: My mistake, Tim. Sorry, I misunderstood. But gave me a chance to pontificate. Tim Klasell - Stifel, Nicolaus & Co., Inc., Research Division: And then one quick follow-on. CD Networks was recently taken out, and I know you're trying to expand into some of the regions where they played. Does that open up opportunity for you? Or do you think they become more competitive inside of a larger? Paul L. Sagan: Well, they talked a lot about that as a facilities-based business, and about connectivity and hosting. So maybe they have a different model there. I'll let them talk to that over time. We already have a presence and have had a presence long-standing in Japan and Korea, but also in Hong Kong, Singapore and other parts of Asia Pac. We think there's lots of opportunity to grow there. Part of succeeding is your competition not executing well. I can hope that they don't. But we will operate assuming they will. Paul L. Sagan: Everyone left on the lines, if you keep your questions brief, we'll try to get to everybody before our hour runs out.

Your next question is coming from the line of Sameet Sinha from B. Riley. Sameet Sinha - B. Riley & Co., LLC, Research Division: My question was basically around executive changes. So David Kenny, I remember, he was -- just became President, he -- one of his core focuses was going to be the international market. Who takes on those responsibilities? And do you plan to now that the President position has come back to you. Do you think you'll continue with the distributed structure for international? Or is it going to become more centralized? And just as a follow-on, the new CIO position, is that more internally focused or more external and client-focused? Paul L. Sagan: Okay. So the CIO assignment, you can think of as a classical internal systems. But obviously, delivering what we need to deliver to our customers and Kumud has that focus, and I'm very excited by his comments and efforts to date. He's got a lot of work ahead of him. And we're going to push him hard and expect great results. David was an advocate at all time, as I was for international growth. We have had offices outside of the U.S. in Asia Pac, in Europe. Really within the first 6 months of commercial operation, we're going to continue that. We have moved along time ago from sort of signing up any customer we could find to industry vertical, focus on solution selling and we moved to a feeder [ph] Model a long time ago with a general manager in Europe, general manager in Asia Pac, reporting to the global head of sales services and marketing. Bob Hughes has the 3 feeder [ph] focus. That hasn't changed and it won't change, and we will continue to push decision-making into the field hold country managers responsible for their results. There will be no change based on the management changes. We intend go faster after the opportunities around the globe.

Your next question is coming from the line of Ben Rose from Battle Road Research. Ben Z. Rose - Battle Road Research Ltd.: Could you describe your current working relationship with Verizon Communications and how that has evolved and may be evolving over time? Paul L. Sagan: Great. I'm going to do the questions and answers quickly to try to get to the end of the next few minutes. Very good relationship. They're one of our best resellers. We have a very strong relationship with them, actually, around the world because they have a global footprint today. We're very pleased with that. We're going to continue to try to develop and grow that going forward.

Next question is from Jeff Van Rhee from Craig-Hallum. Jeffrey Van Rhee - Craig-Hallum Capital Group LLC, Research Division: I guess, 2 questions. First on the 2012 guidance. The -- if I remember that last year, this was the quarter you had given the forward year guidance. You're not giving it here. Obviously, you considered it. Maybe walk us through your thinking there? And then secondly, just a clarification. I might have missed it, but I think the networks that you're in. Have you seen any change? Namely, are you paying to be in any of those networks at this point? Paul L. Sagan: So Jeff, we're not going to walk you through it. The future is always difficult to predict. We live in a difficult economic times. So we're not going to go farther. We stopped doing that a while ago. Not going to revisit that now. In terms of networks, I did talk about that earlier. We've now had network level of number of relationships on very similar kinds of terms that we've them in the past. We don't see a fundamental change there. We're growing that not just in terms of number of networks themselves, but countries allowing us to expand our capacity and our region. We're very pleased with how network relationships, and that whole model is going for us right now. Operator?

Your next question is coming from Rod Ratliff from SunTrust Robinson Humphrey. Rodney W. Ratliff - SunTrust Robinson Humphrey, Inc., Research Division: Paul, very quickly, everything else has been asked and answered. Just give a little bit of color into the strength in margins? Is it safe to say that the larger the M&E reprices have worked their way to the customer base? J. D. Sherman: Rod, it's J.D. We talked about having 8 of our 10 biggest customers renew at the beginning of the year. So obviously, that started to work its way through. And we have seen the volumes grow within that customer base. But there is a continuum of prices come down, contracts come up, we do renewals, and we generally in the volume business give lower prices for higher volumes. So I don't think that we're at any kind of a discontinuity point on that other than those very large contracts.

The next question is from Chad Bartley from Pacific Crest. Chad Bartley - Pacific Crest Securities, Inc., Research Division: I just wanted to ask another question on the value-added services' piece. If you've seen 58% of total revenue, that's about a 17% growth rate. Basically it is close to historically. That's about a 5 points slow down from the first half. So what's driving that slowdown? Is it a function of demand? Or is it more along the lines of competition of prices? If you can give us some clarity on the slowdown, that'd be good. Paul L. Sagan: No, I think it's a matter of one larger numbers and scale. I think it's a question of the economy. It's a question of the market. And there's always a competitive dynamic, and we always face that.We've competed hard, and I think done well out there based on the value of what we're offering. Operator?

Your next question is from the line of Donna Jaegers from Davidson. Donna Jaegers - D.A. Davidson & Co., Research Division: On the security product, can you give us a little more color as far as how you're pricing the tokenization product? And shouldn't that, since it's in the e-commerce space, shouldn't that help out Q4 as well? Paul L. Sagan: Well, we felt, as you know, not a licensed product to our main customers. We don't ship them a box. We sell things on a recurring basis. Some have usage base and with overage. That's a relatively new service, but some customers are using that. It's not a needle mover on the whole company right now. It's part of the security suite of services. DDoS mitigation at the edge is clearly our leading product. And then we have several others, like compliance and tokenization, and we think there's a lot of opportunities to continue to innovate new products there. We think it's a driver to what attracts commerce customers to our platform. And that should be. It's such a good commerce season, a driver of Q4 in aggregate.

Your final question is from the line of Rob Sanderson, ABR Investment Strategy. Rob Sanderson - American Technology Research: Just got under the wire there. A question is, a lot had been asked and answered already. But on mobile and the growth rate you're seeing there in mobile data. You talked last year about that being a new opportunity and in that other category. So what are the updated thoughts on the opportunity there, and how you see that progressing over the next couple of years? Paul L. Sagan: One of the biggest, most fundamental changes, I think in the last 24 months is the rapid growth of mobile, especially if you think of mobile as cellular and then WiFi and not just smartphones, where there's been this explosion of innovations, but tablets, which didn't really exist 2 years ago. And now we just see, particularly because of the iPad, which is revolution in what's going on out there. We think hold together, these things are all critically important of our relationships with our customers and our opportunity to leverage our platform to bring them new value-added services going forward. And we're very excited about it. All the -- I think, the estimates today say the majority of Internet access, not data, but the accesses will be over mobile devices. And you pick the timeframe, 12, 18, 24, 30 months. And it's going to drive all sorts of new opportunity for us. And we're hard at work with our network partners, with our customers and our technology partners building solutions that we think can have value going forward over the next couple of years. And we're excited about that. Anyway Rob, you did make it under the wire, thank you. Thank you, everybody, for dialing in. Thank you for your questions and interest. And we look forward to seeing some of you in December and then talking to all of you in about 90 days or a little more on reporting on Q4. Thank you.

Ladies and gentlemen, that concludes today's conference. We thank you for your participation. You may now disconnect. Have a great day.