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Cogent Communications Holdings, Inc. (CCOI) — this company's answers

The model's full reasoning — Q2 2017 call → NOWe need to determine if the transcript shows the dynamic described. The question asks about a "recently emerged positive element of the business" whose meaningful contribution began only within roughly the last few quarters. Analysts probe it, and management responds with unhesitating, granular operational command, answering follow-ups with specific present-tense working detail, while conveying that the element's contribution is still early. We need to identify if such an element exists in the call. The call discusses various aspects: corporate revenue growth, NetCentric revenue, VPN services, sales force productivity, data centers, etc. The question specifically mentions "recently emerged positive element" and "meaningful contribution began only within roughly the last few quarters." Which element is that? Possibly VPN services? Or maybe the increase in sales force? Or the improvement in NetCentric growth? Or something else. Let's read the transcript carefully. The analysts ask about traffic growth, sales force productivity, NetCentric pricing, etc. The management talks about VPN services as a growing part of corporate revenue. In the Q&A, when asked about sales productivity, Dave mentions VPN services as a driver. He says: "We have seen a continued improvement in our VPN services. We sell a VPL – that's a virtual private line service, that's increasingly being use as a replacement for MPLS... That market is actually much larger than the corporate dedicated Internet access market. Our VPN services have increased to a total of 17% of total revenues, and over 25% of our corporate revenues." That seems like a recently emerged element? But is it "new to meaningful contribution within recent quarters"? The transcript doesn't explicitly say it's new. It says "increased to a total of 17% of total revenues" – that suggests it's been growing, but not necessarily that it's new. Also, the question asks about a "recently emerged positive element" that analysts probe. The analysts ask about sales productivity, traffic, NetCentric pricing, etc. The management's responses are detailed. But we need to see if there is a specific element that is young and management conveys that most of its effect lies ahead. Another candidate: The improvement in NetCentric revenue growth from 3.8% to 6.1% constant currency. That is a recent improvement.

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