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X5 Solutions, Inc.

X5 Solutions, Inc., deems itself a hybrid carrier. The Seattle, Wash.-based company is both facilities-based and a reseller of local exchange voice and data services to business customers only on a flat rate basis over broad-band facilities, such as T-1 circuits. X5 also claims to be the largest provider of voice traffic to government offices for the State of Washington.

The company has interconnection agreements with Verizon and Qwest and provides services in three primary markets: Seattle, Portland, Ore., and Salt Lake City, Utah. However, X5 Solutions also delivers services to Phoenix and even to the East Coast in instances where clients in its home territories utilize the company to provide service to satellite offices.

X5 Solutions, Inc. was founded by Richard Reynolds as  Bank-Tel in 1988 to provide voice and data services to various trade associations and their members, as well as commercial enterprises. During 1991 Bank-Tel was renamed Network ACI and by 1999 the fast growing telecom was acquired by regional CLEC Teligent. However, Network ACI's doors closed when Teligent filed for Chapter 11 bankruptcy in 2001. Reynolds then funded and relaunched his former company as X5 Solutions by May 2001.

As part of the spinoff, X5 regained 65% of the customer base it had prior to the Network ACI sale to Teligent. In September 2002, X5 expanded into Portland, Oregon and Salt Lake City, Utah. In January 2003, the company moved into its current Seattle headquarters and today touts that it is privately held and debt free.

X5 claims its specialty is providing network services, VoIP, PRI and next generation trunking. VoIP became available throughout the network starting in 2008. During 2009, the telecom began migrating its system away from CopperCom's CSX 2100 media gateway and softswitch by installing a new platform provided by Metaswitch Networks. The move was prompted by CopperCom announcing that it would no longer provide upgrades for its TDM switch.

The CopperCom switch still is in operation and providing much of the service to X5's enterprise customers. But the addition of Metaswitch's next generation could open doors for the company to pursue mid-market clients and grow its ViOP business.. Currently the company client portfolio consists primarily of enterprise customers such as hospitals, universities and state agencies.

Specifically, X5 products and services include dial tone PRI T1s, Internet connectivity with data services including DS3, OC3, OC12, OC48 and Ethernet dedicated internet access. The company also offers point-to-point private line service using these circuits. Additionally, X5 provides SIP trunking, wide area networking both domestically and internationally (via frame relay, private IP configurations, and MPLS), and long distance and toll-free calling services. The company claims access via partners to over 200,000 route miles globally, which provides access capability in over 200 Tier 1 cities throughout 27 countries.

X5 Solutions has a direct sales staff based in Seattle and also sells wholesale and commercial services  through its "Alternate Agent Program." The network marketing sales strategy relies on a small number ("a handful") of independent sales agents who earn residual commissions and bonuses by selling X5 products. Reynolds, president and CEO, has been using network marketing since before 2003. The independent agents also sell other carriers products. 

X5 also uses brokers, such as NWMap (Portland, OR),  as another sales arm for the company to reach out to potential business clients.  X5 operates sales offices out of its Seattle headquarters and Portland. The office in Salt Lake City, Utah was closed within the past two years.

On Feb. 24, 2009, the Federal Communications Commission fined E5 Solutions $20,000 and cited the company for failing to provide with its certification (1) an explanation of any action taken against data brokers and (2) a summary of all customer complaints during the past year related to the unauthorized release of consumer proprietary network information.

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