Internap (INAPQ) 10-Q 4 Aug 16 2016 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information	6 Months Ended
	Jun. 30, 2016shares
Document and Entity Information Abstract
Entity Registrant Name	Internap Corp
Entity Central Index Key	1,056,386
Trading Symbol	inap
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock Shares Outstanding	56,689,129
Document Type	10-Q
Document Period End Date	Jun. 30, 2016
Amendment Flag	false
Document Fiscal Year Focus	2,016
Document Fiscal Period Focus	Q2

UNAUDITED CONDENSED CONSOLIDATE

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Total revenues	$ 74,315	$ 80,432	$ 150,239	$ 161,218
Direct costs of sales and services, exclusive of depreciation and amortization, shown below:
Direct costs of customer support	7,919	9,090	16,723	18,208
Sales, general and administrative	18,131	21,577	37,061	43,544
Depreciation and amortization	19,217	22,566	38,330	42,774
Exit activities, restructuring and impairments	152	59	353	325
Total operating costs and expenses	76,789	86,270	154,914	171,175
Loss from operations	(2,474)	(5,838)	(4,675)	(9,957)
Non-operating expenses:
Interest expense	8,082	6,825	15,067	13,689
Other, net	116	55	471	(474)
Total non-operating expenses	8,198	6,880	15,538	13,215
Loss before income taxes and equity in earnings of equity-method investment	(10,672)	(12,718)	(20,213)	(23,172)
Provision (benefit) for income taxes	62	(137)	200	(111)
Equity in earnings of equity-method investment, net of taxes	(41)	(47)	(77)	(85)
Net loss	(10,693)	(12,534)	(20,336)	(22,976)
Other comprehensive income (loss):
Foreign currency translation adjustment	9	(16)	117	(158)
Unrealized gain (loss) on foreign currency contracts	75	168	713	(187)
Unrealized gain (loss) on interest rate swap	189	67	336	(149)
Total other comprehensive income (loss)	273	219	1,166	(494)
Comprehensive loss	$ (10,420)	$ (12,315)	$ (19,170)	$ (23,470)
Basic and diluted net loss per share (in dollars per share)	$ (0.21)	$ (0.24)	$ (0.39)	$ (0.45)
Weighted average shares outstanding used in computing basic and diluted net loss per share (in shares)	52,062	51,579	52,241	51,590
Operating segments
Revenues:
Total revenues	$ 74,315	$ 80,432	$ 150,239	$ 161,218
Direct costs of sales and services, exclusive of depreciation and amortization, shown below:
Direct costs of sales and services, exclusive of depreciation and amortization	31,370	32,978	62,447	66,324
Operating segments | Data center and network services
Revenues:
Total revenues	50,459	53,521	101,331	107,589
Direct costs of sales and services, exclusive of depreciation and amortization, shown below:
Direct costs of sales and services, exclusive of depreciation and amortization	24,650	26,116	49,023	52,597
Operating segments | Cloud And Hosting Services
Revenues:
Total revenues	23,856	26,911	48,908	53,629
Direct costs of sales and services, exclusive of depreciation and amortization, shown below:
Direct costs of sales and services, exclusive of depreciation and amortization	$ 6,720	$ 6,862	$ 13,424	$ 13,727

UNAUDITED CONDENSED CONSOLIDAT3

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Current assets:
Cash and cash equivalents	$ 13,868	$ 17,772
Accounts receivable, net of allowance for doubtful accounts of $1,319 and $1,751, respectively	18,358	20,292
Prepaid expenses and other assets	11,975	12,405
Total current assets	44,201	50,469
Property and equipment, net	325,136	328,700
Investment in joint venture	3,020	2,768
Intangible assets, net	31,159	32,887
Goodwill	130,313	130,313
Deposits and other assets	8,998	9,474
Total assets	542,827	554,611
Current liabilities:
Accounts payable	26,054	22,607
Accrued liabilities	10,467	10,737
Deferred revenues	6,540	6,603
Capital lease obligations	9,586	8,421
Term loan, less discount and prepaid costs of $2,192 and $1,784, respectively	808	1,215
Exit activities and restructuring liability	1,432	2,034
Other current liabilities	1,358	2,566
Total current liabilities	56,245	54,183
Deferred revenues	4,967	4,759
Capital lease obligations	48,149	48,692
Revolving credit facility	35,500	31,000
Term loan, less discount and prepaid costs of $5,721 and $5,703, respectively	283,779	285,298
Exit activities and restructuring liability	1,486	1,844
Deferred rent	7,879	8,879
Deferred tax liability	1,223	880
Other long-term liabilities	4,424	4,640
Total liabilities	443,652	440,175
Commitments and contingencies (note 8)
Stockholders' equity:
Preferred stock, $0.001 par value; 20,000 shares authorized; no shares issued or outstanding
Common stock, $0.001 par value; 120,000 shares authorized; 56,689 and 55,971 shares outstanding, respectively	57	56
Additional paid-in capital	1,281,762	1,277,511
Treasury stock, at cost; 962 and 826 shares, respectively	(6,736)	(6,393)
Accumulated deficit	(1,174,293)	(1,153,957)
Accumulated items of other comprehensive loss	(1,615)	(2,781)
Total stockholders' equity	99,175	114,436
Total liabilities and stockholders' equity	$ 542,827	$ 554,611

UNAUDITED CONDENSED CONSOLIDAT4

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Allowance for doubtful accounts receivable (in dollars)	$ 1,319	$ 1,751
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized	20,000	20,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized	120,000	120,000
Common stock, shares outstanding	56,689	55,971
Treasury stock, shares	962	826
Term loan current
Term loan, discount (in dollars)	$ 2,192	$ 1,784
Term loan noncurrent
Term loan, discount (in dollars)	$ 5,721	$ 5,703

UNAUDITED CONDENSED CONSOLIDAT5

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Cash Flows from Operating Activities:
Net loss	$ (20,336)	$ (22,976)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	38,330	42,774
Amortization of debt discount and issuance costs	1,233	990
Stock-based compensation expense, net of capitalized amount	3,464	3,764
Equity in earnings of equity-method investment	(77)	(85)
Provision for doubtful accounts	580	606
Non-cash change in capital lease obligations	527	(640)
Non-cash change in exit activities and restructuring liability	619	536
Non-cash change in deferred rent	(1,000)	(788)
Deferred taxes	39	(157)
Payment of debt lender fees	(1,716)
Other, net	186	19
Changes in operating assets and liabilities:
Accounts receivable	1,702	(1,647)
Prepaid expenses, deposits and other assets	4,606	(962)
Accounts payable	2,269	(8,162)
Accrued and other liabilities	(3,931)	(1,554)
Deferred revenues	94	1,153
Exit activities and restructuring liability	(1,579)	(1,342)
Asset retirement obligation	(174)
Other liabilities	(35)	35
Net cash flows provided by operating activities	24,801	11,564
Cash Flows from Investing Activities:
Purchases of property and equipment	(26,314)	(30,689)
Additions to acquired and developed technology	(769)	(810)
Net cash flows used in investing activities	(27,083)	(31,499)
Cash Flows from Financing Activities:
Proceeds from credit agreements	4,500	17,000
Principal payments on credit agreements	(1,500)	(1,500)
Payments on capital lease obligations	(4,827)	(3,717)
Proceeds from exercise of stock options	675	4,489
Acquisition of common stock for income tax withholdings	(343)	(868)
Other, net	(192)	943
Net cash flows (used in) provided by financing activities	(1,687)	16,347
Effect of exchange rates on cash and cash equivalents	65	(84)
Net decrease in cash and cash equivalents	(3,904)	(3,672)
Cash and cash equivalents at beginning of period	17,772	20,084
Cash and cash equivalents at end of period	13,868	16,412
Supplemental disclosure of cash flow information:
Cash paid for interest	14,356	13,052
Non-cash acquisition of property and equipment under capital leases	4,921	1,176
Additions to property and equipment included in accounts payable	$ 6,334	$ 4,298

NATURE OF OPERATIONS AND BASIS

NATURE OF OPERATIONS AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2016
Organization, Consolidation and Presentation Of Financial Statements [Abstract]
NATURE OF OPERATIONS AND BASIS OF PRESENTATION	1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION Internap Corporation (“we,” “us” or “our”) provides high-performance Internet infrastructure services at 50 data centers across North America, Europe and the Asia-Pacific region and through 83 Internet Protocol (“IP”) service points. We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These financial statements include all of our accounts and those of our wholly-owned subsidiaries. We have eliminated all intercompany transactions and balances in the accompanying financial statements. We have condensed or omitted certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP. In the opinion of management, the accompanying financial statements reflect all adjustments, which consist of normal recurring adjustments unless otherwise disclosed, necessary for a fair statement of our financial position as of June 30, 2016 and our operating results and cash flows for the interim periods presented. The balance sheet at December 31, 2015 was derived from our audited financial statements, but does not include all disclosures required by GAAP. You should read the accompanying financial statements and the related notes in conjunction with our financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2015 filed with the Securities and Exchange Commission. The preparation of financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Actual results may differ materially from these estimates. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for any future periods.

CHANGE IN ORGANIZATIONAL STRUCT

CHANGE IN ORGANIZATIONAL STRUCTURE AND REALIGNMENT OF EXPENSES	6 Months Ended
	Jun. 30, 2016
Change In Organizational Structure And Realignment Of Expenses [Abstract]
CHANGE IN ORGANIZATIONAL STRUCTURE AND REALIGNMENT OF EXPENSES	2. CHANGE IN ORGANIZATIONAL STRUCTURE AND REALIGNMENT OF EXPENSES During the three months ended March 31, 2016, we changed our organizational structure in an effort to create more effective and efficient operations and to improve customer and product focus. In that regard, our chief executive officer, who is also our chief operating decision maker, revised the information that he regularly reviews for purposes of allocating resources and assessing performance. As a result, beginning January 1, 2016, we now report our financial performance based on our new segments, described in note 9 “Operating Segments.” We have reclassified prior period amounts to conform to the current presentation. In addition, in conjunction with the change in our organizational structure, we reclassified certain costs included in the expense categories on our consolidated statement of operations, which resulted in the following: a reclassification of The prior year reclassifications, which did not affect total revenues, total direct costs of sales and services, operating loss or net loss, are summarized as follows (in thousands): Three Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Revenues: Data center services $ 59,422 $ (59,422 ) $ — IP services 21,010 (21,010 ) — Data center and network services — 53,521 53,521 Cloud and hosting services — 26,911 26,911 Direct costs of sales and services, exclusive of depreciation and amortization: Data center services 24,335 (24,335 ) — IP services 8,643 (8,643 ) — Data center and network services — 26,116 26,116 Cloud and hosting services — 6,862 6,862 Direct costs of amortization of acquired and developed technologies 592 (592 ) — Sales and marketing 9,759 (9,759 ) — General and administrative 11,818 (11,818 ) — Sales, general and administrative (“SGA”) — 21,577 21,577 Depreciation and amortization 21,974 592 22,566 Six Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Revenues: Data center services $ 118,520 $ (118,520 ) $ — IP services 42,698 (42,698 ) — Data center and network services — 107,589 107,589 Cloud and hosting services — 53,629 53,629 Direct costs of sales and services, exclusive of depreciation and amortization: Data center services 48,599 (48,599 ) — IP services 17,725 (17,725 ) — Data center and network services — 52,597 52,597 Cloud and hosting services — 13,727 13,727 Direct costs of amortization of acquired and developed technologies 1,742 (1,742 ) — Sales and marketing 20,042 (20,042 ) — General and administrative 23,502 (23,502 ) — SGA — 43,544 43,544 Depreciation and amortization 41,032 1,742 42,774 SGA expense consists primarily of costs related to sales and marketing, compensation and other expense for executive, finance, product development, human resources and administrative personnel, professional fees and other general corporate costs.

FAIR VALUE MEASUREMENTS

FAIR VALUE MEASUREMENTS	6 Months Ended
	Jun. 30, 2016
Fair Value Disclosures [Abstract]
FAIR VALUE MEASUREMENTS	3. FAIR VALUE MEASUREMENTS We account for certain assets and liabilities at fair value. The hierarchy below lists three levels of fair value based on the extent to which inputs used in measuring fair value are observable in the market. We categorize each of our fair value measurements in one of these three levels based on the lowest level input that is significant to the fair value measurement in its entirety. These levels are: • Level 1: Quoted prices in active markets for identical assets or liabilities; • Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and • Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets and liabilities measured at fair value on a recurring basis are summarized as follows (in thousands): Level 1 Level 2 Level 3 Total June 30, 2016: Foreign currency contracts (note 7) $ — $ 43 $ — $ 43 Interest rate swap (note 7) — 392 — 392 Asset retirement obligations (1) — — 2,706 2,706 December 31, 2015: Foreign currency contracts (note 7) — 1,019 — 1,019 Interest rate swap (note 7) — 728 — 728 Asset retirement obligations (1) — — 2,803 2,803 (1) We calculate the fair value of asset retirement obligations by discounting the estimated amount using the current Treasury bill rate adjusted for our credit non-performance. At June 30, 2016 and December 31, 2015, the balance of the asset retirement obligation was $0 and $0.2 million, respectively, which we included in “Other current liabilities,” and $2.7 million and $2.6 million, respectively, which we included in “Other long-term liabilities,” in the accompanying consolidated balance sheets. The following table provides a summary of changes in our Level 3 asset retirement obligations for the six months ended June 30, 2016 (in thousands): Balance, January 1, 2016 $ 2,803 Accretion 103 Payments (174 ) Gain on settlement (26 ) Balance, June 30, 2016 $ 2,706 The fair values of our other Level 3 debt liabilities, estimated using a discounted cash flow analysis based on incremental borrowing rates for similar types of borrowing arrangements, are as follows (in thousands): June 30, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value Term loan $ 292,500 $ 307,000 $ 294,000 $ 303,000 Revolving credit facility 35,500 35,600 31,000 30,400

GOODWILL

GOODWILL	6 Months Ended
	Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
GOODWILL	4. GOODWILL During the three months ended March 31, 2016, we changed our operating segments, as discussed in note 9 “Operating Segments,” and, subsequently, our reporting units. We now have the following five reporting units: IP services, IP products, data center services (“DCS”), cloud and hosting services and hosting products. We allocated goodwill to our new reporting units using a relative fair value approach. In addition, we completed an assessment of any potential goodwill impairment for all reporting units immediately prior to and after the reallocation and determined that no impairment existed. During the three months ended June 30, 2016, we revised the allocation of goodwill to our reportable segments and we considered the likelihood of triggering events that might cause us to reassess goodwill on an interim basis and concluded that we had an impairment indictor as a result of a sustained decline in the price of our common stock. We recalculated the fair value of our reporting units and all units exceeded their carrying values. However, as of June 30, 2016, the fair value of DCS exceeded its carrying value by only 2%. At June 30, 2016, goodwill attributable to DCS was $40.6 million. If revenue or other significant assumptions for such reporting unit decline, we may be at risk for future impairment. In addition, if our overall results of operations and/or the share price of our common stock do not increase, and there was no expectation of an improvement within a reasonable period of time, we may be required to recognize an impairment charge in future periods, which could be material. During the six months ended June 30, 2016, we re-allocated goodwill as follows (in thousands): December 31, Re-allocations June 30, Reportable segments: Data center services $ 90,849 $ (90,849 ) $ — IP services 39,464 (39,464 ) — Data center and network services — 80,104 80,104 Cloud and hosting services — 50,209 50,209 Total $ 130,313 $ — $ 130,313

DEBT

DEBT	6 Months Ended
	Jun. 30, 2016
Debt Disclosure [Abstract]
DEBT	5. DEBT During the three months ended June 30, 2016, we entered into an amendment to our credit agreement, which, among other things, amended the interest coverage ratio and leverage ratio covenants to make them less restrictive and increased the applicable margin for the revolving credit facility and term loan by 1.0%. We paid a one-time aggregate fee of $1.7 million to the lenders for the amendment, which was recorded as a debt discount of $1.5 million related to the term loan and prepaid debt issuance costs of $0.2 million related to the revolving credit facility. In addition, we paid $0.4 million in third-party fees, which we recorded as expense of $0.3 million related to the term loan and as prepaid debt issuance costs of $0.1 million related to the revolving credit facility. Since the recording of the amendment was a modification of our previous credit agreement, we will continue to amortize the debt discount and prepaid issuance costs on our previous credit agreement. During the three and six months ended June 30, 2016, we amortized, as interest expense, $0.7 million and $1.2 million, respectively, of the total debt discount and prepaid debt issuance costs.

EXIT ACTIVITIES AND RESTRUCTURI

EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES	6 Months Ended
	Jun. 30, 2016
Restructuring and Related Activities [Abstract]
EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES	6. EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES During the six months ended June 30, 2016, we recorded initial restructuring charges primarily due to ceasing use of office facilities. We also recorded subsequent plan adjustments in sublease income assumptions for certain properties included in our previously-disclosed plans. We include the initial charges and plan adjustments in “Exit activities, restructuring and impairments” in the accompanying statements of operations and comprehensive loss for the three and six months ended June 30, 2016 and 2015. The following table displays the transactions and balances for exit activities and restructuring charges, substantially related to our data center and network services segment, during the six months ended June 30, 2016 and 2015 (in thousands): December 31, 2015 Initial Charges Plan Adjustments Cash Payments June 30, 2016 Real estate obligations: 2016 exit activities $ — $ 239 $ (11 ) $ (113 ) $ 115 2015 exit activities 1,007 — (4 ) (221 ) 782 2014 exit activities 1,701 — 28 (286 ) 1,443 2007 restructuring 1,170 — 366 (958 ) 578 Total $ 3,878 $ 239 $ 379 $ (1,578 ) $ 2,918 December 31, 2014 Initial Charges Plan Adjustments Cash Payments June 30, 2015 Real estate obligations: 2014 exit activities $ 2,010 $ — $ 217 $ (264 ) $ 1,963 2007 restructuring 2,325 — 324 (908 ) 1,741 Other 175 — (6 ) (169 ) — Total $ 4,510 $ — $ 535 $ (1,341 ) $ 3,704

DERIVATIVES

DERIVATIVES	6 Months Ended
	Jun. 30, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]
DERIVATIVES	7. DERIVATIVES Foreign Currency Contracts We have foreign currency contracts to mitigate the risk of a portion of our Canadian compensation expense. These contracts will hedge foreign exchange variations between the United States and Canadian dollar and commit us to purchase a total of $12.0 million Canadian dollars at an exchange rate of 1.2855 through June 2017. As of June 30, 2016 and December 31, 2015, the fair value of our foreign currency contracts was less than $0.1 million and $0.7 million, respectively, included in “Other current liabilities,” and $0 and $0.3 million, respectively, included in “Other long-term liabilities,” in the accompanying consolidated balance sheets. The activity of the foreign currency contracts was as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Unrealized gain (loss), net of less than $0.1 million income tax, included in “Accumulated items of other comprehensive loss” in the accompanying consolidated balance sheets $ 75 $ 168 $ 713 $ (187 ) Realized loss on effective portion, included as compensation expense in “Direct costs of customer support” and “Sales, general and administrative” in the accompanying consolidated statements of operations and comprehensive loss (20 ) (95 ) (199 ) (202 ) Interest Rate Swap We have an interest rate swap to manage exposure to interest rate movements of our credit agreement. Our interest rate swap involves the receipt of variable rate amounts from a counterparty in exchange for us making fixed-rate payments, over 1.5%, over the life of the agreement without exchange of the underlying notional amount. The cash flow hedge has a notional amount starting at $150.0 million through December 31, 2016. As of June 30, 2016 and December 31, 2015, the fair value of our interest rate swap was $0.4 million and $0.7 million, respectively, and is included in “Other current liabilities” in the accompanying consolidated balance sheets. We record the effective portion of the change in fair value of our interest rate swap in “Accumulated items of other comprehensive loss” in the accompanying consolidated balance sheets. We did not recognize any hedge ineffectiveness during either of the three and six months ended June 30, 2016 and 2015. We will reclassify amounts reported in “Accumulated items of other comprehensive loss” related to our interest rate swaps to “Interest expense” in our accompanying consolidated statements of operations and comprehensive loss as we accrue interest payments on our variable-rate debt. Through December 31, 2016, we estimate that we will reclassify an additional $0.4 million as an increase to interest expense since the hedge interest rate currently exceeds the variable interest rate on our debt. The activity of our interest rate swap is summarized as follows (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Gain (loss) recorded as the effective portion of the change in fair value $ 189 $ 67 $ 336 $ (149 ) Interest payments reclassified as an increase to interest expense 197 199 395 397

COMMITMENTS, CONTINGENCIES AND

COMMITMENTS, CONTINGENCIES AND LITIGATION	6 Months Ended
	Jun. 30, 2016
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS, CONTINGENCIES AND LITIGATION	8. COMMITMENTS, CONTINGENCIES AND LITIGATION We are subject to legal proceedings, claims and litigation arising in the ordinary course of business. Although the outcome of these matters is currently not determinable, we do not expect that the ultimate costs to resolve these matters will have a material adverse impact on our financial condition, results of operations or cash flows.

OPERATING SEGMENTS

OPERATING SEGMENTS	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
OPERATING SEGMENTS	9. OPERATING SEGMENTS During the three months ended March 31, 2016, we changed our organizational structure in an effort to create more effective and efficient business operations and to improve customer and product focus. In that regard, our chief operating decision maker (our chief executive officer) revised the information that he regularly reviews for purposes of allocating resources and assessing performance. As a result, beginning January 1, 2016, we now report our financial performance based on our two new reportable segments, Data Center and Network Services and Cloud and Hosting Services, as follows: Data Center and Network Services Our Data Center and Network Services segment consists of colocation and Internet Protocol (“IP”) connectivity services. Colocation Colocation involves providing physical space within data centers and associated services such as power, interconnection, environmental controls, monitoring and security while allowing our customers to deploy and manage their servers, storage and other equipment in our secure data centers. We sell our colocation services at 50 data centers across North America, Europe and the Asia-Pacific region. We refer to 15 of these facilities as “company-controlled,” meaning we control the data center operations, staffing and infrastructure and have negotiated long-term leases for the facilities. For company-controlled facilities, in most cases we design the data center infrastructure, procure the capital equipment, deploy the infrastructure and are responsible for the operation and maintenance of the facility. We refer to the remaining 35 data centers as “partner” sites. In these locations, a third party designs and deploys the infrastructure and provides for the operation and maintenance of the facility. IP Connectivity IP connectivity includes our patented Performance IP™ service, content delivery network services, IP routing hardware and software platform and Managed Internet Route Optimizer™ Controller. By intelligently routing traffic with redundant, high-speed connections over multiple, major Internet backbones, our IP connectivity provides high-performance and highly-reliable delivery of content, applications and communications to end users globally. We deliver our IP connectivity through 83 IP service points around the world. Cloud and Hosting Services Our cloud and hosting services segment consists of hosted Infrastructure-as-a-Service as a cloud platform or via managed hosting. For both Infrastructure-as-a-Service options, we provision and maintain the hardware, data center infrastructure and interconnection, while allowing our customers to own and manage their software applications and content. Cloud Cloud services involve providing compute and storage services via an integrated platform that includes servers, storage and network. We built our next generation cloud platform with our high-density colocation, Performance IP service and OpenStack, a leading open source technology for cloud services. We deliver our cloud services in eight locations across North America, Europe and the Asia-Pacific region. Managed Hosting Managed hosting involves providing a single tenant infrastructure environment consisting of servers, storage and network. We deliver this customizable infrastructure platform based on enterprise-class technology to support complex application and compliance requirements for our customers. We deliver our managed hosting services in 11 locations across North America, Europe and the Asia-Pacific region. Segment Results The following table provides segment results, with prior period amounts reclassified to conform to the current presentation (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Revenues: Data center and network services $ 50,459 $ 53,521 $ 101,331 $ 107,589 Cloud and hosting services 23,856 26,911 48,908 53,629 Total revenues 74,315 80,432 150,239 161,218 Direct costs of sales and services, exclusive of depreciation and amortization: Data center and network services 24,650 26,116 49,023 52,597 Cloud and hosting services 6,720 6,862 13,424 13,727 Total direct costs of network, sales and services, exclusive of depreciation and amortization 31,370 32,978 62,447 66,324 Segment profit: Data center and network services 25,809 27,405 52,308 54,992 Cloud and hosting services 17,136 20,049 35,484 39,902 Total segment profit 42,945 47,454 87,792 94,894 Exit activities, restructuring and impairments 152 59 353 325 Other operating expenses, including direct costs of customer support, depreciation and amortization 45,267 53,233 92,114 104,526 Loss from operations (2,474 ) (5,838 ) (4,675 ) (9,957 ) Non-operating expense 8,198 6,880 15,538 13,215 Loss before income taxes and equity in (earnings) of equity-method investment $ (10,672 ) $ (12,718 ) $ (20,213 ) $ (23,172 ) The prior year reclassifications, which did not affect total segment profit, are summarized as follows (in thousands): Three Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Segment profit: Data center services $ 35,087 $ (35,087 ) $ — IP services 12,367 (12,367 ) — Data center and network services — 27,405 27,405 Cloud and hosting services — 20,049 20,049 Total segment profit $ 47,454 $ — $ 47,454 Six Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Segment profit: Data center services $ 69,921 $ (69,921 ) $ — IP services 24,973 (24,973 ) — Data center and network services — 54,992 54,992 Cloud and hosting services — 39,902 39,902 Total segment profit $ 94,894 $ — $ 94,894 Segment profit is calculated as segment revenues less direct costs of sales and services, exclusive of depreciation and amortization for the segment, and does not include any depreciation or amortization associated with direct costs. We view direct costs of sales and services as generally less-controllable, external costs and we regularly monitor the margin of revenues in excess of these direct costs. We have excluded depreciation and amortization from segment profit because it is based on estimated useful lives of tangible and intangible assets. We base depreciation and amortization on historical costs incurred to build out our deployed network and the historical costs of these assets may not be indicative of current or future capital expenditures.

NET LOSS PER SHARE

NET LOSS PER SHARE	6 Months Ended
	Jun. 30, 2016
Earnings Per Share [Abstract]
NET LOSS PER SHARE	10. NET LOSS PER SHARE We compute basic net loss per share by dividing net loss attributable to our common stockholders by the weighted average number of shares of common stock outstanding during the period. We exclude all outstanding options and unvested restricted stock as such securities are anti-dilutive for all periods presented. Basic and diluted net loss per share is calculated as follows (in thousands, except per share amounts): Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Net loss attributable to common stock $ (10,693 ) $ (12,534 ) $ (20,336 ) $ (22,976 ) Weighted average shares outstanding, basic and diluted 52,062 51,579 52,241 51,590 Net loss per share, basic and diluted $ (0.21 ) $ (0.24 ) $ (0.39 ) $ (0.45 ) Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans 6,084 6,866 6,084 6,866

RECENT ACCOUNTING PRONOUNCEMENT

RECENT ACCOUNTING PRONOUNCEMENTS	6 Months Ended
	Jun. 30, 2016
New Accounting Pronouncements and Changes In Accounting Principles [Abstract]
RECENT ACCOUNTING PRONOUNCEMENTS	11. RECENT ACCOUNTING PRONOUNCEMENTS During the three months ended March 31, 2016, we adopted new guidance that required debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, which is consistent with the presentation of debt discounts. The guidance, applied retrospectively, was effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Adoption did not have a material impact on our financial condition and had no impact on our result of operations. Our restatement of prior year amounts was as follows: December 31, 2015 As Previously Reported Restatements As Reported Prepaid expenses and other assets $ 12,646 $ (241 ) $ 12,405 Deposits and other assets 10,177 (703 ) 9,474 Term loan, current (1,456 ) 241 (1,215 ) Term loan, long-term (286,001 ) 703 (285,298 ) In March 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that amends several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification within the statement of cash flows. Certain of the amendments in this accounting standard update are to be applied using a modified retrospective approach by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted, while other amendments can be applied prospectively or retrospectively. The guidance is effective for periods beginning after December 15, 2016. Early adoption is permitted. If an entity early adopts the amendments in an interim period, any adjustments will be reflected as of the beginning of the fiscal year that includes that interim period. We are currently evaluating the impact of the provisions of this accounting standard update. In February 2016, FASB issued new guidance on lease accounting, which requires all leases in excess of 12 months to be recognized on the balance sheet as lease assets and lease liabilities. For operating leases, a lessee is required to recognize a right-of-use asset and lease liability, initially measured at the present value of the lease payment; recognize a single lease cost over the lease term generally on a straight-line basis; and classify all cash payments within operating activities on the cash flow statement. The guidance is effective for annual and interim periods beginning after December 15, 2018. Earlier adoption is permitted. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. In August 2014, FASB issued new guidance which requires management to evaluate, in connection with preparing financial statements for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable) and provide related disclosures. The guidance is effective for the annual and interim periods ending after December 15, 2016. Early adoption is permitted. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. In May 2014, FASB issued new guidance which provides a single model for revenue arising from contracts with customers and supersedes current revenue recognition guidance. The guidance is effective for periods beginning January 1, 2018. The guidance permits the application of its requirements retrospectively to all prior periods presented or in the year of adoption through a cumulative adjustment. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. As we have not completed our evaluation, we cannot make a determination of the impact and have not yet selected a transition method or determined the impact of the standard on our ongoing financial reporting.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	6 Months Ended
	Jun. 30, 2016
Accounting Policies [Abstract]
BASIS OF PRESENTATION	We have prepared the accompanying unaudited condensed consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. These financial statements include all of our accounts and those of our wholly-owned subsidiaries. We have eliminated all intercompany transactions and balances in the accompanying financial statements. We have condensed or omitted certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP. In the opinion of management, the accompanying financial statements reflect all adjustments, which consist of normal recurring adjustments unless otherwise disclosed, necessary for a fair statement of our financial position as of June 30, 2016 and our operating results and cash flows for the interim periods presented. The balance sheet at December 31, 2015 was derived from our audited financial statements, but does not include all disclosures required by GAAP. You should read the accompanying financial statements and the related notes in conjunction with our financial statements and notes thereto contained in our Annual Report on Form 10-K for the year ended December 31, 2015 filed with the Securities and Exchange Commission. The preparation of financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. Actual results may differ materially from these estimates. The results of operations for the three and six months ended June 30, 2016 are not necessarily indicative of the results that may be expected for any future periods.
RECENT ACCOUNTING PRONOUNCEMENTS	During the three months ended March 31, 2016, we adopted new guidance that required debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, which is consistent with the presentation of debt discounts. The guidance, applied retrospectively, was effective for financial statements issued for fiscal years beginning after December 15, 2015, and interim periods within those fiscal years. Adoption did not have a material impact on our financial condition and no impact on our result of operations. Our restatement of prior year amounts was as follows: December 31, 2015 As Previously Reported Restatements As Reported Prepaid expenses and other assets $ 12,646 $ (241 ) $ 12,405 Deposits and other assets 10,177 (703 ) 9,474 Term loan, current (1,456 ) 241 (1,215 ) Term loan, long-term (286,001 ) 703 (285,298 ) In March 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance that amends several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification within the statement of cash flows. Certain of the amendments in this accounting standard update are to be applied using a modified retrospective approach by means of a cumulative-effect adjustment to equity as of the beginning of the period in which the guidance is adopted, while other amendments can be applied prospectively or retrospectively. The guidance is effective for periods beginning after December 15, 2016. Early adoption is permitted. If an entity early adopts the amendments in an interim period, any adjustments will be reflected as of the beginning of the fiscal year that includes that interim period. We are currently evaluating the impact of the provisions of this accounting standard update. In February 2016, FASB issued new guidance on lease accounting, which requires all leases in excess of 12 months to be recognized on the balance sheet as lease assets and lease liabilities. For operating leases, a lessee is required to recognize a right-of-use asset and lease liability, initially measured at the present value of the lease payment; recognize a single lease cost over the lease term generally on a straight-line basis; and classify all cash payments within operating activities on the cash flow statement. The guidance is effective for annual and interim periods beginning after December 15, 2018. Earlier adoption is permitted. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. In August 2014, FASB issued new guidance which requires management to evaluate, in connection with preparing financial statements for each annual and interim reporting period, whether there are conditions or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern within one year after the date the financial statements are issued (or within one year after the date that the financial statements are available to be issued when applicable) and provide related disclosures. The guidance is effective for the annual and interim periods ending after December 15, 2016. Early adoption is permitted. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. In May 2014, FASB issued new guidance which provides a single model for revenue arising from contracts with customers and supersedes current revenue recognition guidance. The guidance is effective for periods beginning January 1, 2018. The guidance permits the application of its requirements retrospectively to all prior periods presented or in the year of adoption through a cumulative adjustment. We are currently evaluating the impact that adoption will have on our consolidated financial statements and related disclosures. As we have not completed our evaluation, we cannot make a determination of the impact and have not yet selected a transition method or determined the impact of the standard on our ongoing financial reporting.

CHANGE IN ORGANIZATIONAL STRU18

CHANGE IN ORGANIZATIONAL STRUCTURE AND REALIGNMENT OF EXPENSES (Tables)	6 Months Ended
	Jun. 30, 2016
Change In Organizational Structure And Realignment Of Expenses [Abstract]
Schedule of change in organizational structure and realigment of expenses	Three Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Revenues: Data center services $ 59,422 $ (59,422 ) $ — IP services 21,010 (21,010 ) — Data center and network services — 53,521 53,521 Cloud and hosting services — 26,911 26,911 Direct costs of sales and services, exclusive of depreciation and amortization: Data center services 24,335 (24,335 ) — IP services 8,643 (8,643 ) — Data center and network services — 26,116 26,116 Cloud and hosting services — 6,862 6,862 Direct costs of amortization of acquired and developed technologies 592 (592 ) — Sales and marketing 9,759 (9,759 ) — General and administrative 11,818 (11,818 ) — Sales, general and administrative (“SGA”) — 21,577 21,577 Depreciation and amortization 21,974 592 22,566 Six Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Revenues: Data center services $ 118,520 $ (118,520 ) $ — IP services 42,698 (42,698 ) — Data center and network services — 107,589 107,589 Cloud and hosting services — 53,629 53,629 Direct costs of sales and services, exclusive of depreciation and amortization: Data center services 48,599 (48,599 ) — IP services 17,725 (17,725 ) — Data center and network services — 52,597 52,597 Cloud and hosting services — 13,727 13,727 Direct costs of amortization of acquired and developed technologies 1,742 (1,742 ) — Sales and marketing 20,042 (20,042 ) — General and administrative 23,502 (23,502 ) — SGA — 43,544 43,544 Depreciation and amortization 41,032 1,742 42,774

FAIR VALUE MEASUREMENTS (Tables

FAIR VALUE MEASUREMENTS (Tables)	6 Months Ended
	Jun. 30, 2016
Fair Value Disclosures [Abstract]
Schedule of assets and liabilities measured at fair value on a recurring basis	Level 1 Level 2 Level 3 Total June 30, 2016: Foreign currency contracts (note 7) $ — $ 43 $ — $ 43 Interest rate swap (note 7) — 392 — 392 Asset retirement obligations (1) — — 2,706 2,706 December 31, 2015: Foreign currency contracts (note 7) — 1,019 — 1,019 Interest rate swap (note 7) — 728 — 728 Asset retirement obligations (1) — — 2,803 2,803 (1) We calculate the fair value of asset retirement obligations by discounting the estimated amount using the current Treasury bill rate adjusted for our credit non-performance. At June 30, 2016 and December 31, 2015, the balance of the asset retirement obligation was $0 and $0.2 million, respectively, which we included in “Other current liabilities,” and $2.7 million and $2.6 million, respectively, which we included in “Other long-term liabilities,” in the accompanying consolidated balance sheets.
Schedule of changes in asset retirement obligations	Balance, January 1, 2016 $ 2,803 Accretion 103 Payments (174 ) Gain on settlement (26 ) Balance, June 30, 2016 $ 2,706
Schedule of fair value of term loan and revolving credit facility	June 30, 2016 December 31, 2015 Carrying Amount Fair Value Carrying Amount Fair Value Term loan $ 292,500 $ 307,000 $ 294,000 $ 303,000 Revolving credit facility 35,500 35,600 31,000 30,400

GOODWILL (Tables)

GOODWILL (Tables)	6 Months Ended
	Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
Schedule of re-allocated goodwill	December 31, Re-allocations June 30, Reportable segments: Data center services $ 90,849 $ (90,849 ) $ — IP services 39,464 (39,464 ) — Data center and network services — 80,104 80,104 Cloud and hosting services — 50,209 50,209 Total $ 130,313 $ — $ 130,313

EXIT ACTIVITIES AND RESTRUCTU21

EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES (Tables)	6 Months Ended
	Jun. 30, 2016
Restructuring and Related Activities [Abstract]
Schedule of transactions and balances for exit activities and restructuring charges	December 31, 2015 Initial Charges Plan Adjustments Cash Payments June 30, 2016 Real estate obligations: 2016 exit activities $ — $ 239 $ (11 ) $ (113 ) $ 115 2015 exit activities 1,007 — (4 ) (221 ) 782 2014 exit activities 1,701 — 28 (286 ) 1,443 2007 restructuring 1,170 — 366 (958 ) 578 Total $ 3,878 $ 239 $ 379 $ (1,578 ) $ 2,918 December 31, 2014 Initial Charges Plan Adjustments Cash Payments June 30, 2015 Real estate obligations: 2014 exit activities $ 2,010 $ — $ 217 $ (264 ) $ 1,963 2007 restructuring 2,325 — 324 (908 ) 1,741 Other 175 — (6 ) (169 ) — Total $ 4,510 $ — $ 535 $ (1,341 ) $ 3,704

DERIVATIVES (Tables)

DERIVATIVES (Tables)	6 Months Ended
	Jun. 30, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Schedule of the activity of the foreign currency contracts	Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Unrealized gain (loss), net of less than $0.1 million income tax, included in “Accumulated items of other comprehensive loss” in the accompanying consolidated balance sheets $ 75 $ 168 $ 713 $ (187 ) Realized loss on effective portion, included as compensation expense in “Direct costs of customer support” and “Sales, general and administrative” in the accompanying consolidated statements of operations and comprehensive loss (20 ) (95 ) (199 ) (202 )
Schedule of activity of interest rate swaps	Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Gain (loss) recorded as the effective portion of the change in fair value $ 189 $ 67 $ 336 $ (149 ) Interest payments reclassified as an increase to interest expense 197 199 395 397

OPERATING SEGMENTS (Tables)

OPERATING SEGMENTS (Tables)	6 Months Ended
	Jun. 30, 2016
Segment Reporting [Abstract]
Schedule of operating results for business segments, along with reconciliations from segment profit to loss before income taxes and equity in (earnings) of equity-method investment	Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Revenues: Data center and network services $ 50,459 $ 53,521 $ 101,331 $ 107,589 Cloud and hosting services 23,856 26,911 48,908 53,629 Total revenues 74,315 80,432 150,239 161,218 Direct costs of sales and services, exclusive of depreciation and amortization: Data center and network services 24,650 26,116 49,023 52,597 Cloud and hosting services 6,720 6,862 13,424 13,727 Total direct costs of network, sales and services, exclusive of depreciation and amortization 31,370 32,978 62,447 66,324 Segment profit: Data center and network services 25,809 27,405 52,308 54,992 Cloud and hosting services 17,136 20,049 35,484 39,902 Total segment profit 42,945 47,454 87,792 94,894 Exit activities, restructuring and impairments 152 59 353 325 Other operating expenses, including direct costs of customer support, depreciation and amortization 45,267 53,233 92,114 104,526 Loss from operations (2,474 ) (5,838 ) (4,675 ) (9,957 ) Non-operating expense 8,198 6,880 15,538 13,215 Loss before income taxes and equity in (earnings) of equity-method investment $ (10,672 ) $ (12,718 ) $ (20,213 ) $ (23,172 )
Schedule of reconciliation total segment profit	Three Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Segment profit: Data center services $ 35,087 $ (35,087 ) $ — IP services 12,367 (12,367 ) — Data center and network services — 27,405 27,405 Cloud and hosting services — 20,049 20,049 Total segment profit $ 47,454 $ — $ 47,454 Six Months Ended June 30, 2015 As Previously Reported Reclassification As Reported Segment profit: Data center services $ 69,921 $ (69,921 ) $ — IP services 24,973 (24,973 ) — Data center and network services — 54,992 54,992 Cloud and hosting services — 39,902 39,902 Total segment profit $ 94,894 $ — $ 94,894

NET LOSS PER SHARE (Tables)

NET LOSS PER SHARE (Tables)	6 Months Ended
	Jun. 30, 2016
Earnings Per Share [Abstract]
Schedule of basic and diluted net loss per share	Three Months Ended June 30, Six Months Ended June 30, 2016 2015 2016 2015 Net loss attributable to common stock $ (10,693 ) $ (12,534 ) $ (20,336 ) $ (22,976 ) Weighted average shares outstanding, basic and diluted 52,062 51,579 52,241 51,590 Net loss per share, basic and diluted $ (0.21 ) $ (0.24 ) $ (0.39 ) $ (0.45 ) Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans 6,084 6,866 6,084 6,866

RECENT ACCOUNTING PRONOUNCEME25

RECENT ACCOUNTING PRONOUNCEMENTS (Tables)	6 Months Ended
	Jun. 30, 2016
New Accounting Pronouncements and Changes In Accounting Principles [Abstract]
Schedule of recent accounting pronouncements	December 31, 2015 As Previously Reported Restatements As Reported Prepaid expenses and other assets $ 12,646 $ (241 ) $ 12,405 Deposits and other assets 10,177 (703 ) 9,474 Term loan, current (1,456 ) 241 (1,215 ) Term loan, long-term (286,001 ) 703 (285,298 )

NATURE OF OPERATIONS AND BASI26

NATURE OF OPERATIONS AND BASIS OF PRESENTATION (Detail Textuals)	6 Months Ended
	Jun. 30, 2016Data_CenterPoint
Organization, Consolidation and Presentation Of Financial Statements [Abstract]
Number of data centers | Data_Center	50
Number of internet protocol service points | Point	83

CHANGE IN ORGANIZATIONAL STRU27

CHANGE IN ORGANIZATIONAL STRUCTURE AND REALIGNMENT OF EXPENSES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues	$ 74,315	$ 80,432	$ 150,239	$ 161,218
Sales, general and administrative	18,131	21,577	37,061	43,544
Depreciation and amortization	19,217	22,566	38,330	42,774
Operating segments
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues	74,315	80,432	150,239	161,218
Direct costs of sales and services, exclusive of depreciation and amortization	31,370	32,978	62,447	66,324
Operating segments | Data center services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues
Direct costs of sales and services, exclusive of depreciation and amortization
Operating segments | IP services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues
Direct costs of sales and services, exclusive of depreciation and amortization
Operating segments | Data center and network services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues	50,459	53,521	101,331	107,589
Direct costs of sales and services, exclusive of depreciation and amortization	24,650	26,116	49,023	52,597
Operating segments | Cloud And Hosting Services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues	23,856	26,911	48,908	53,629
Direct costs of sales and services, exclusive of depreciation and amortization	$ 6,720	6,862	$ 13,424	13,727
As Previously Reported
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Direct costs of amortization of acquired and developed technologies		592		1,742
Sales and marketing		9,759		20,042
General and administrative		11,818		23,502
Sales, general and administrative
Depreciation and amortization		21,974		41,032
As Previously Reported | Operating segments | Data center services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		59,422		118,520
Direct costs of sales and services, exclusive of depreciation and amortization		24,335		48,599
As Previously Reported | Operating segments | IP services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		21,010		42,698
Direct costs of sales and services, exclusive of depreciation and amortization		8,643		17,725
As Previously Reported | Operating segments | Data center and network services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues
Direct costs of sales and services, exclusive of depreciation and amortization
As Previously Reported | Operating segments | Cloud And Hosting Services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues
Direct costs of sales and services, exclusive of depreciation and amortization
Reclassification
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Direct costs of amortization of acquired and developed technologies		(592)		(1,742)
Sales and marketing		(9,759)		(20,042)
General and administrative		(11,818)		(23,502)
Sales, general and administrative		21,577		43,544
Depreciation and amortization		592		1,742
Reclassification | Operating segments | Data center services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		(59,422)		(118,520)
Direct costs of sales and services, exclusive of depreciation and amortization		(24,335)		(48,599)
Reclassification | Operating segments | IP services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		(21,010)		(42,698)
Direct costs of sales and services, exclusive of depreciation and amortization		(8,643)		(17,725)
Reclassification | Operating segments | Data center and network services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		53,521		107,589
Direct costs of sales and services, exclusive of depreciation and amortization		26,116		52,597
Reclassification | Operating segments | Cloud And Hosting Services
Change In Organizational Structure And Realignment Of Expenses [Line Items]
Total revenues		26,911		53,629
Direct costs of sales and services, exclusive of depreciation and amortization		$ 6,862		$ 13,727

FAIR VALUE MEASUREMENTS - Summa

FAIR VALUE MEASUREMENTS - Summary of Assets and liabilities measured at fair value on recurring basis (Details) - Recurring basis - USD ($) $ in Thousands		Jun. 30, 2016	Dec. 31, 2015
Level 1 | Foreign currency contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value
Level 1 | Interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value
Level 1 | Asset retirement obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value	[1]
Level 2 | Foreign currency contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value		43	1,019
Level 2 | Interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value		392	728
Level 2 | Asset retirement obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value	[1]
Level 3 | Foreign currency contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value
Level 3 | Interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value
Level 3 | Asset retirement obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value	[1]	2,706	2,803
Total | Foreign currency contracts
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value		43	1,019
Total | Interest rate swap
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value		392	728
Total | Asset retirement obligations
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Liabilities, fair value	[1]	$ 2,706	$ 2,803
[1]	We calculate the fair value of asset retirement obligations by discounting the estimated amount using the current Treasury bill rate adjusted for our credit non-performance. At June 30, 2016 and December 31, 2015, the balance of the asset retirement obligation was $0 and $0.2 million, respectively, which we included in "Other current liabilities," and $2.7 million and $2.6 million, respectively, which we included in "Other long-term liabilities," in the accompanying consolidated balance sheets.

FAIR VALUE MEASUREMENTS - Sum29

FAIR VALUE MEASUREMENTS - Summary of Assets and liabilities measured at fair value on recurring basis(Parentheticals) (Details) - USD ($) $ in Millions	Jun. 30, 2016	Dec. 31, 2015
Other current liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	$ 0	$ 0.2
Other long-term liabilities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Asset retirement obligations	$ 2.7	$ 2.6

FAIR VALUE MEASUREMENTS - Sum30

FAIR VALUE MEASUREMENTS - Summary of changes in Level 3 financial asset - Asset retirement obligation (Details 1) - Asset retirement obligations $ in Thousands	6 Months Ended
	Jun. 30, 2016USD ($)
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward]
Balance, January 1, 2016	$ 2,803
Accretion	103
Payments	(174)
Gain on settlement	(26)
Balance, June 30, 2016	$ 2,706

FAIR VALUE MEASUREMENTS - Sum31

FAIR VALUE MEASUREMENTS - Summary of fair value Level 3 debt - Term loan (Details 2) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Carrying Amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Term loan	$ 292,500	$ 294,000
Revolving credit facility	35,500	31,000
Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Term loan	307,000	303,000
Revolving credit facility	$ 35,600	$ 30,400

GOODWILL (Details)

GOODWILL (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
Goodwill [Line Items]
Goodwill	$ 130,313	$ 130,313
Re-allocations
Goodwill [Line Items]
Goodwill
Data center services
Goodwill [Line Items]
Goodwill	40,600
Operating segments | Data center services
Goodwill [Line Items]
Goodwill		90,849
Operating segments | Data center services | Re-allocations
Goodwill [Line Items]
Goodwill	(90,849)
Operating segments | IP services
Goodwill [Line Items]
Goodwill		39,464
Operating segments | IP services | Re-allocations
Goodwill [Line Items]
Goodwill	(39,464)
Operating segments | Data center and network services
Goodwill [Line Items]
Goodwill	80,104
Operating segments | Data center and network services | Re-allocations
Goodwill [Line Items]
Goodwill	80,104
Operating segments | Cloud And Hosting Services
Goodwill [Line Items]
Goodwill	50,209
Operating segments | Cloud And Hosting Services | Re-allocations
Goodwill [Line Items]
Goodwill	$ 50,209

GOODWILL (Detail Textuals)

GOODWILL (Detail Textuals) - USD ($) $ in Thousands	Jun. 30, 2016	Jan. 02, 2016	Dec. 31, 2015
Goodwill [Line Items]
Goodwill attributable to the DCS services	$ 130,313		$ 130,313
Data center services
Goodwill [Line Items]
Percentage of fair value exceeded carrying value		2.00%
Goodwill attributable to the DCS services	$ 40,600

DEBT (Detail Textuals)

DEBT (Detail Textuals) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2016	Jun. 30, 2015
Short-term Debt [Line Items]
Prepaid debt issuance costs		$ 1,774
Amortization of debt discount and issuance costs		1,233	$ 990
Credit Agreement
Short-term Debt [Line Items]
Amortization of debt discount and issuance costs	$ 700	1,200
Credit Agreement | Term Loan
Short-term Debt [Line Items]
Interest rate	1.00%
Fee paid	$ 1,700	1,700
Debt discount	1,500	$ 1,500
Third party fees	400
Expenses recorded related to term loan	$ 300
Credit Agreement | Revolving credit facility
Short-term Debt [Line Items]
Interest rate	1.00%
Prepaid debt issuance costs	$ 200
Debt issuance costs	$ 100

EXIT ACTIVITIES AND RESTRUCTU35

EXIT ACTIVITIES AND RESTRUCTURING LIABILITIES - Summary of activity and balances for restructuring and asset impairment activity (Details) - Data center and network services - Exit activities and Restructuring charges - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014	$ 3,878	$ 4,510
Initial Charges	239
Plan Adjustments	379	535
Cash Payments	(1,578)	(1,341)
June 30, 2016 and 2015	2,918	3,704
2016 exit activities
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014
Initial Charges	239
Plan Adjustments	(11)
Cash Payments	(113)
June 30, 2016 and 2015	115
2015 exit activities
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014	1,007
Initial Charges
Plan Adjustments	(4)
Cash Payments	(221)
June 30, 2016 and 2015	782
2014 exit activities
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014	1,701	2,010
Initial Charges
Plan Adjustments	28	217
Cash Payments	(286)	(264)
June 30, 2016 and 2015	1,443	1,963
2007 restructuring
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014	1,170	2,325
Initial Charges
Plan Adjustments	366	324
Cash Payments	(958)	(908)
June 30, 2016 and 2015	$ 578	1,741
Other
Restructuring Reserve [Roll Forward]
December 31, 2015 and 2014		175
Initial Charges
Plan Adjustments		(6)
Cash Payments		(169)
June 30, 2016 and 2015

DERIVATIVES (Details)

DERIVATIVES (Details) - Foreign currency contracts - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Derivative [Line Items]
Unrealized gain (loss), net of less than $0.1 million income tax, included in "Accumulated items of other comprehensive loss" in the accompanying consolidated balance sheets	$ 75	$ 168	$ 713	$ (187)
Realized loss on effective portion, included as compensation expense in "Direct costs of customer support" and "Sales, general and administrative" in the accompanying consolidated statements of operations and comprehensive loss	$ (20)	$ (95)	$ (199)	$ (202)

DERIVATIVES (Parentheticals) (D

DERIVATIVES (Parentheticals) (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Designated as Hedging Instrument | Cash Flow Hedging | Foreign currency contracts
Derivative [Line Items]
Tax on unrealized losses arising from foreign currency contracts	$ 0.1	$ 0.1	$ 0.1	$ 0.1

DERIVATIVES (Details 1)

DERIVATIVES (Details 1) - Interest rate swap - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Derivative [Line Items]
Gain (loss) recorded as the effective portion of the change in fair value	$ 189	$ 67	$ 336	$ (149)
Interest payments reclassified as an increase to interest expense	$ 197	$ 199	$ 395	$ 397

DERIVATIVES (Detail Textuals)

DERIVATIVES (Detail Textuals) - Designated as Hedging Instrument - Cash Flow Hedging $ in Millions	6 Months Ended
	Jun. 30, 2016USD ($)	Jun. 30, 2016CAD	Dec. 31, 2015USD ($)
Interest rate swap
Derivative [Line Items]
Notional amount of cash flow hedge instruments	$ 150
Fixed-rate payments	1.50%	1.50%
Interest rate swap | Other comprehensive loss
Derivative [Line Items]
Estimated reclassification of additional increase in interest expense as on December 31, 2016	$ 0.4
Interest rate swap | Other current liabilities
Derivative [Line Items]
Fair value of derivatives	$ 0.4		$ 0.7
Foreign currency contracts | June 2017
Derivative [Line Items]
Notional amount of cash flow hedge instruments | CAD		CAD 12,000
Foreign currency contracts exchange rate	1.2855	1.2855
Foreign currency contracts | Other current liabilities
Derivative [Line Items]
Fair value of derivatives	$ 0.1		0.7
Foreign currency contracts | Other long-term liabilities
Derivative [Line Items]
Fair value of derivatives	$ 0		$ 0.3

OPERATING SEGMENTS - Summary of

OPERATING SEGMENTS - Summary of operating results for business segments - (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Revenues:
Total revenues	$ 74,315	$ 80,432	$ 150,239	$ 161,218
Segment profit:
Exit activities, restructuring and impairments	152	59	353	325
Loss from operations	(2,474)	(5,838)	(4,675)	(9,957)
Non-operating expense	(8,198)	(6,880)	(15,538)	(13,215)
Loss before income taxes and equity in (earnings) of equity-method investment	(10,672)	(12,718)	(20,213)	(23,172)
Operating segments
Revenues:
Total revenues	74,315	80,432	150,239	161,218
Direct costs of sales and services, exclusive of depreciation and amortization:
Total direct costs of sales and services, exclusive of depreciation and amortization	31,370	32,978	62,447	66,324
Segment profit:
Total segment profit	42,945	47,454	87,792	94,894
Operating segments | Data center and network services
Revenues:
Total revenues	50,459	53,521	101,331	107,589
Direct costs of sales and services, exclusive of depreciation and amortization:
Total direct costs of sales and services, exclusive of depreciation and amortization	24,650	26,116	49,023	52,597
Segment profit:
Total segment profit	25,809	27,405	52,308	54,992
Operating segments | Cloud And Hosting Services
Revenues:
Total revenues	23,856	26,911	48,908	53,629
Direct costs of sales and services, exclusive of depreciation and amortization:
Total direct costs of sales and services, exclusive of depreciation and amortization	6,720	6,862	13,424	13,727
Segment profit:
Total segment profit	17,136	20,049	35,484	39,902
Segment reconciling items
Segment profit:
Exit activities, restructuring and impairments	152	59	353	325
Other operating expenses, including direct costs of customer support, depreciation and amortization	45,267	53,233	92,114	104,526
Loss from operations	(2,474)	(5,838)	(4,675)	(9,957)
Non-operating expense	8,198	6,880	15,538	13,215
Loss before income taxes and equity in (earnings) of equity-method investment	$ (10,672)	$ (12,718)	$ 20,213	$ (23,172)

OPERATING SEGMENTS (Details 1)

OPERATING SEGMENTS (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
As Previously Reported
Segment profit:
Total segment profit		$ 47,454		$ 94,894
Reclassification
Segment profit:
Total segment profit
Operating segments
Segment profit:
Total segment profit	$ 42,945	47,454	$ 87,792	94,894
Operating segments | Data center services
Segment profit:
Total segment profit
Operating segments | Data center services | As Previously Reported
Segment profit:
Total segment profit		35,087		69,921
Operating segments | Data center services | Reclassification
Segment profit:
Total segment profit		(35,087)		(69,921)
Operating segments | IP services
Segment profit:
Total segment profit
Operating segments | IP services | As Previously Reported
Segment profit:
Total segment profit		12,367		24,973
Operating segments | IP services | Reclassification
Segment profit:
Total segment profit		(12,367)		(24,973)
Operating segments | Data center and network services
Segment profit:
Total segment profit	25,809	27,405	52,308	54,992
Operating segments | Data center and network services | As Previously Reported
Segment profit:
Total segment profit
Operating segments | Data center and network services | Reclassification
Segment profit:
Total segment profit		27,405		54,992
Operating segments | Cloud And Hosting Services
Segment profit:
Total segment profit	$ 17,136	20,049	$ 35,484	39,902
Operating segments | Cloud And Hosting Services | As Previously Reported
Segment profit:
Total segment profit
Operating segments | Cloud And Hosting Services | Reclassification
Segment profit:
Total segment profit		$ 20,049		$ 39,902

OPERATING SEGMENTS (Detail Text

OPERATING SEGMENTS (Detail Textuals)	6 Months Ended
	Jun. 30, 2016PointSegment
Segment Reporting [Abstract]
Number of new reportable segments | Segment	2
Number of internet protocol service points | Point	83

NET LOSS PER SHARE (Details)

NET LOSS PER SHARE (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2016	Jun. 30, 2015	Jun. 30, 2016	Jun. 30, 2015
Earnings Per Share [Abstract]
Net loss attributable to common stock	$ (10,693)	$ (12,534)	$ (20,336)	$ (22,976)
Weighted average shares outstanding, basic and diluted (in shares)	52,062	51,579	52,241	51,590
Net loss per share, basic and diluted (in dollars per share)	$ (0.21)	$ (0.24)	$ (0.39)	$ (0.45)
Anti-dilutive securities excluded from diluted net loss per share calculation for stock-based compensation plans (in shares)	6,084	6,866	6,084	6,866

RECENT ACCOUNTING PRONOUNCEME44

RECENT ACCOUNTING PRONOUNCEMENTS (Details) - USD ($) $ in Thousands	Jun. 30, 2016	Dec. 31, 2015
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Prepaid expenses and other assets	$ 11,975	$ 12,405
Deposits and other assets	8,998	9,474
Term loan, current	(808)	(1,215)
Term loan, long-term	$ (283,779)	(285,298)
As Previously Reported
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Prepaid expenses and other assets		12,646
Deposits and other assets		10,177
Term loan, current		(1,456)
Term loan, long-term		(286,001)
Reclassification
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Prepaid expenses and other assets		(241)
Deposits and other assets		(703)
Term loan, current		241
Term loan, long-term		$ 703