. Segment reporting:

(a)

We are organized and managed based on

two

operating segments which are differentiated primarily by their services, the markets they serve and the regulatory environments in which they operate and are described as follows:

Network Access Services - This segment derives revenue from the sale of mobile phones, telephony services, high speed Internet access, Internet hosting and consulting services to individuals and small businesses primarily through the Ting website. Revenues are generated in the United States.

Domain Services – This segment includes wholesale and retail domain name registration services, value added services and portfolio services. The Company primarily earns revenues from the registration fees charged to resellers in connection with new, renewed and transferred domain name registrations; the sale of retail Internet domain name registration and email services to individuals and small businesses; and by making its portfolio of domain names available for sale or lease. Domain Services revenues are attributed to the country in which the contract originates, primarily Canada and the United States.

The Chief Executive Officer is the chief operating decision maker and regularly reviews the operations and performance by segment. The chief operating decision maker reviews gross profit as a key measure of performance for each segment and to make decisions about the allocation of resources. Sales and marketing expenses, technical operations and development expenses, general and administrative expenses, depreciation of property and equipment, amortization of intangibles assets, impairment of indefinite life intangible assets, loss on currency forward contracts, other income (expense), and provision for income taxes, are organized along functional lines and are

not

included in the measurement of segment profitability. Total assets and total liabilities are centrally managed and are

not

reviewed at the segment level by the chief operating decision maker. The Company follows the same

significant accounting policies and estimates for the segments as described in our Annual Report on Form

-K for the fiscal year ended

December

31,

2016.

Information by

operating segments, which is regularly reported to the chief operating decision maker is as follows:

	Network Access		Domain Name Services		Consolidated Totals
Three months ended September 30, 2017

Net Revenues	$	22,993,034	$	62,015,450	$	85,008,484

Cost of revenues
Cost of revenues		13,310,922		47,755,839		61,066,761
Network expenses		446,126		2,014,570		2,460,696
Depreciation of property and equipment		578,257		245,184		823,441
Amortization of intangible assets		11,532		487,500		499,032
Total cost of revenues		14,346,837		50,503,093		64,849,930
Gross Profit		8,646,197		11,512,357		20,158,554

Expenses:
Sales and marketing						7,578,414
Technical operations and development						1,910,147
General and administrative						2,852,345
Depreciation of property and equipment						154,638
Amortization of intangible assets						1,745,923
Impairment of indefinite life intangible assets						1,500
Loss (gain) on currency forward contracts						(54,075	)
Income from operations						5,969,662
Other income (expenses), net						(707,029	)
Income before provision for income taxes					$	5,262,633

	Network Access		Domain Name Services		Consolidated Totals
Three months ended September 30, 2016

Net Revenues	$	19,253,063	$	29,811,264	$	49,064,327

Cost of revenues
Cost of revenues		9,589,183		21,257,485		30,846,668
Network expenses		507,128		780,492		1,287,620
Depreciation of property and equipment		258,042		20,704		278,746
Amortization of intangible assets		13,421		-		13,421
Total cost of revenues		10,367,774		22,058,681		32,426,455
Gross Profit		8,885,289		7,752,583		16,637,872

Expenses:
Sales and marketing						5,479,445
Technical operations and development						1,270,107
General and administrative						2,166,217
Depreciation of property and equipment						178,687
Amortization of intangible assets						279,126
Impairment of indefinite life intangible assets						2,866
Loss (gain) on currency forward contracts						22,475
Income from operations						7,238,949
Other income (expenses), net						(5,021	)
Income before provision for income taxes					$	7,233,928

	Network Access		Domain Name Services		Consolidated Totals
Nine months ended September 30, 2017

Net Revenues	$	63,559,792	$	175,240,055	$	238,799,847

Cost of revenues
Cost of revenues		35,389,553		134,433,264		169,822,817
Network expenses		1,397,832		5,666,626		7,064,458
Depreciation of property and equipment		1,494,299		634,118		2,128,417
Amortization of intangible assets		34,596		1,300,000		1,334,596
Total cost of revenues		38,316,280		142,034,008		180,350,288
Gross Profit		25,243,512		33,206,047		58,449,559

Expenses:
Sales and marketing						22,244,961
Technical operations and development						5,402,385
General and administrative						9,596,298
Depreciation of property and equipment						485,648
Amortization of intangible assets						4,735,221
Impairment of indefinite life intangible assets						1,500
Loss (gain) on currency forward contracts						(115,276	)
Income from operations						16,098,822
Other income (expenses), net						(2,190,673	)
Income before provision for income taxes					$	13,908,149

	Network Access		Domain Name Services		Consolidated Totals
Nine months ended September 30, 2016

Net Revenues	$	55,020,436	$	85,993,893	$	141,014,329

Cost of revenues
Cost of revenues		28,386,395		61,059,098		89,445,493
Network expenses		941,451		2,983,926		3,925,377
Depreciation of property and equipment		655,104		321,315		976,419
Amortization of intangible assets		36,485		-		36,485
Total cost of revenues		30,019,435		64,364,339		94,383,774
Gross Profit		25,001,001		21,629,554		46,630,555

Expenses:
Sales and marketing						15,174,619
Technical operations and development						3,445,118
General and administrative						7,497,752
Depreciation of property and equipment						328,877
Amortization of intangible assets						613,041
Impairment of indefinite life intangible assets						27,745
Loss (gain) on currency forward contracts						(96,993	)
Income from operations						19,640,396
Other income (expenses), net						85,919
Income before provision for income taxes					$	19,726,315

(b) The following is a summary of the Company’s revenue earned from each significant revenue stream:

	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016

Network Access Services:
Mobile Services	$	21,748,809	$	18,374,906	$	60,090,266	$	52,287,808
Other Services		1,244,225		878,157		3,469,526		2,732,628
Total Network Access Services		22,993,034		19,253,063		63,559,792		55,020,436

Domain Services:
Wholesale
Domain Services		47,769,779		22,955,731		135,411,688		65,879,375
Value Added Services		4,401,704		2,226,977		14,034,456		6,834,086
Total Wholesale		52,171,483		25,182,708		149,446,144		72,713,461

Retail		8,872,984		3,721,032		22,937,606		10,747,456
Portfolio		970,983		907,524		2,856,305		2,532,976
Total Domain Services		62,015,450		29,811,264		175,240,055		85,993,893

	$	85,008,484	$	49,064,327	$	238,799,847	$	141,014,329

During the

three

and

nine

months ended

September 30, 2017

and

2016,

customer accounted for more than

10%

of total revenue. As at

September 30, 2017

and

December 31, 2016,

customer accounted for more than

10%

of accounts receivable.

(c)

The following is a summary of the Company’s cost of revenues from each significant revenue stream:

	Three months ended September 30,				Nine months ended September 30,
	2017		2016		2017		2016

Network Access Services:
Mobile Services	$	12,365,383	$	9,087,274	$	32,634,348	$	27,026,242
Other Services		945,539		501,909		2,755,205		1,360,153
Total Network Access Services		13,310,922		9,589,183		35,389,553		28,386,395

Domain Services:
Wholesale
Domain Services		42,294,131		18,934,555		119,206,649		54,215,215
Value Added Services		671,291		463,369		1,823,711		1,401,821
Total Wholesale		42,965,422		19,397,924		121,030,360		55,617,036

Retail		4,610,745		1,727,867		12,775,941		4,968,659
Portfolio		179,672		131,694		626,963		473,403
Total Domain Services		47,755,839		21,257,485		134,433,264		61,059,098

Network Expenses:
Network, other costs		2,460,696		1,287,620		7,064,458		3,925,377
Network, depreciation and amortization costs		1,322,473		292,167		3,463,013		1,012,904
		3,783,169		1,579,787		10,527,471		4,938,281

	$	64,849,930	$	32,426,455	$	180,350,288	$	94,383,774

(d)

The following is a summary of the Company’s property and equipment by geographic region:

	September 30, 2017		December 31, 2016

Canada	$	1,169,409	$	1,010,427
United States		21,036,074		12,398,961
Germany		27,387		41,050
	$	22,232,870	$	13,450,438

(e)

The following is a summary of the Company’s amortizable intangible assets by geographic region:

	September 30, 2017		December 31, 2016

Canada	$	7,522,264	$	5,850,596
United States		39,730,601		633,798
Germany		171,100		325,090
	$	47,423,965	$	6,809,484

(f)

The following is a summary of the Company’s deferred tax asset by geographic region:

	September 30, 2017		December 31, 2016

Canada	$	-	$	5,708,725
	$	-	$	5,708,725

(g)

Valuation and qualifying accounts:

Allowance for doubtful accounts excluding provision for credit notes	Balance at beginning of period		Charged to (recovered) costs and expenses		Write-offs during period		Balance at end of period

Nine months ended September 30, 2017	$	164,145	$	3,741	$	-	$	167,886
Year ended December 31, 2016	$	122,095	$	42,050	$	-	$	164,145