Hello, and welcome to the conference call. This call is being recorded for replay purposes. (Operator Instructions) I would now like to introduce the host of today’s conference, Mr. Jason Starr, Director of Investor Relations. Sir, you may begin.

Good afternoon and welcome to our Q1 2008 results conference call. Before we get started, I would like to remind everyone that some of the statements that we will be making today are forward-looking in nature and involve risks and uncertainties. Actual results may vary significantly from those statements and may be affected by the risks we identify in today’s press release and those identified in our filings with the SEC, including our Form 10-K filed on February 27, 2008. Equinix assumes no obligation and does not intend to update forward-looking statements made on this call. In addition, we will provide non-GAAP measures on today’s conference call. We provide a reconciliation of those measures to the most directly comparable GAAP measures and a list of the reasons why the company uses these measures in today’s press release and on the Equinix Investor Relations page at www.Equinix.com. With us today are Steve Smith, Equinix’s Chief Executive Officer and President and Keith Taylor, Equinix’s Chief Financial Officer. Margie Backaus, Equinix’s Chief Business Officer, will not join us today due to an important family matter. At this time I’ll turn the call over to Steve.

Thank you, Jason. Let me begin today by announcing another outstanding result for the Equinix team in the first quarter of 2008. We significantly exceeded our expectations for revenues and EBITDA with record booking results across all regions. As concerns on the economy heightens, we mentioned on our previous call that we were increasing the frequency of our reviews on all leading indicators and frankly offered what we stated could be conservative guidance for 2008. As you saw in today’s release, this proved to be the case, as the trends witnessed in 2007 continued in the first quarter of 2008, and we still see strong demand and pipeline. We continue to focus on day-to-day execution while maintaining our momentum to drive business towards our objective of generating over $1 billion in revenues, which could occur as soon as the year 2010. We expect the call today to be concise with primary focus on Q1 results. We’ll also provide a brief update on our expansion plans by region, our global integration initiatives, as well as expectations for the remainder of the year. So let me hit the highlights. Total revenue for the company was $158.2 million. This represents a 14% increase sequentially and an 86% increase over last year, which of course also includes our European acquisitions. I should also note in this number, we did receive a one-off benefit from a $1.4 million reversal of a sales allowance reserve for one of our customers in Europe. Our cash gross margins were 61%. This was a great result and ahead of our expectations. Of course, this was due in part to stronger revenues and also a managed pace in hiring and cost containment. An important note, exclusive of our European operations, our cash gross margins were 65%, which is within our…

Thanks, Steve and good afternoon. I’m pleased to provide you with our first quarter results with some additional perspective on the quarter and the rest of the year. So let me first start with revenues. As Steve mentioned, our Q1 revenues grew 14.1% over the prior quarter to $158.2 million, clearly much stronger than our initial expectations, or an 11% quarter-over-quarter based on two discrete adjustments affecting our European operations in Q4 of last year and Q1 of this year. I’ll discuss both of these matters in a moment. As we said last quarter, we thought our guidance could prove to be conservative, yet our revenues came in even higher than these expectations; the result of very strong bookings activity in the quarter, continuing short installation intervals and favorable currency trends across our markets. Our European revenues were $40.8 million, including a $1.4 million one-off benefit related to the reversal of a Q4 sales allowance reserve and $1.4 million of revenues attributed to the Virtu acquisition resulting in quarter-over-quarter increase of 27.5%. Adjusting our growth rate in Europe for these two items, European revenues increased 14% over the prior quarter. The European and Asia-Pacific currency benefit affecting the revenues for the quarter when compared to the exchange rates used for guidance was approximately $1 million for the quarter. Now looking specifically at the US IBXs that opened in 2007, demand and in particular, booking activity was strong in all of these markets and the pricing trends remained consistent with our expectations. Revenues attributed to our new Washington, DC IBX exited the quarter at almost 20% greater than the prior quarter, or about $30 million of annualized revenues, while our revenues from our Chicago and New York expansion IBXs have ramped to greater than $3 million of revenues in the quarter,…

I’d like to now provide a brief update on our ongoing expansion strategy, which has proven to be critical for our ability to meet the increased demand that we have seen across all regions over the past several quarters. In the US market, our Silicon Valley 2 and DC 5 expansions are still on schedule for mid and end Q2 2008 openings respectively. Our LA 4 expansion is still targeted for a Q2 2009 opening. As Keith noted, our three greenfields opened in 2007 are ahead of our initial expectations, particularly in New York, where we’re finishing up our design for phase two. While this isn’t complete yet, we want to provide you an early view into this project, which we estimate will be somewhere in the range of $80 million to $90 million in expansion CapEx. We will provide you with final details on this project when the design is completed, but I should point out that this has not been included in our 2008 CapEx guidance. Yet even if it were, our plan would still be fully funded. In Europe, we opened our two expansions in Q1 in both Paris and Frankfurt. As previously mentioned, the expansion in Paris is already fully booked and the third phase is still expected to open this quarter. I’m pleased to report that our recently opened expansion in Frankfurt is now also fully booked and as a result, we have initiated a new phase there. When complete, this is expected to yield approximately 840 cabinet equivalents. Total capital investment is expected to be $36 million, of which $20 million will be incurred in 2008 and the remainder in 2009. Initial cabinets from this project will be available in Q3 of 2008. Our remaining projects in Amsterdam and London remain on track. Finally,…

(Operator Instructions) Our first question comes from Jonathan Schildkraut - Jefferies.

Congratulations on a great quarter. I just wanted to start with the guidance that you provided, updated. I was wondering if there were specific geographies or products that were driving that update in guidance? Was there something more in Europe or Asia or was it kind of broad-based in nature?

Jonathan, as I said in my remarks, we saw strong uplift in all of our key markets. I’d say the majority of our key markets across all three regions. The bottom line is all three regions had an uptick in activity that was greater than our expectations.

Are you finding that you are winning in different types of deals than you have prior years? Or are you finding that you’re still winning for the interconnection piece but you are seeing more competition in the large scale co-lo? I’m just trying to get a sense of how the competitive market has evolved over the last 12 or 15 months.

We are starting to closely measure win rate now, which has given us some insights into what’s happening market by market. We’re in excess of 80% win rate across the board here so when we see and we’re competing in certain markets pricing will be a critical factor, capacity will obviously be a critical factor, but the trends differ a little bit by region. Generally, we’re winning for the same kinds of reasons: the network density, the great reliability that we present, the service excellence that we have historically. So we very rarely lose because of that. It’s normally driven around price where we’re not willing to go down below a certain level or we just don’t have capacity in that market.

You gave the cabinets billing at the end of the quarter by US and the Asia-Pacific market. Last quarter I think the company was trying to give us some background in how we might think about available for sale cabinets in some of the geographies and maybe if you can give us US and the Asia-Pacific and then where you are in Europe?

So just to give you a sense, as I said, billing roughly 78% billed. By the end of Q2 we should have about 33,450 cabinets available. So when you look at the math, Q1 entering we had 30,100 cabinets in the US so you can get a sense of the amount of capacity that we still have available. I think as it relates to our European operations we have tried to limit the amount of disclosure we have. Certainly given the announcement that Steve had mentioned today with Eric moving over to Europe, we’re going to spend a lot more time as we integrate our Oracle applications and hopefully get a much better number for you going forward. At this point we reticent to give anything on the European operations on a capacity basis.

In terms of having more than $250 million in cash on the books at year end, is there a baked assumption in there that you will continue to see cash flows from employee options being exercised?

I certainly think that there’s some level of that; when the stock started trading down we clearly saw that number drop off quite dramatically. There is some activity, as I mentioned, relating to employee options and restricted shares but overall I think as you go through time and through the next two years, you’re going to see that number drop off fairly dramatically.

At what level do you think you’d restart your 10b51 plan?

Are you talking about me specifically?

The firm.

I was the only one that cancelled my 10b51 plan.

Oh, it was just you. All right; I thought it was the firm. Thank you.

Yes.

Our next question comes from Jonathan Atkin - RBC Capital Markets.

First of all just on the housekeeping front, if you could repeat what you indicated on MRR and cabinet churn; I missed that. With respect to the new business that you’re seeing, the new logos, what’s the trend in terms of the number of cabinets and amount of cross connect activity compared to your existing base?

Let me deal with the housekeeping matter. MMR and cabinet churn is 2.1% and 1.6%, respectively. Jonathan, could you just repeat the second part of your question please?

Both for the US as well across the other regions, what trends are you seeing in terms of the typical size of your new customers? What’s the footprint that they’re taking initially in terms of number of cabinets and the amount of cross connects they’re taking?

The deployments that I mentioned in the comments, particularly in Europe, we’re starting to downsize the small to mid-sized, moderate-sized deployments and the uptick and cross-connect activity will start to take place as we start to work with that team to push the interconnection agenda. In the US and Asia markets, we’re looking for a good mix of co-lo and interconnection where we can, and again, it varies deal by deal. But the smaller footprints, I’d say 10 to 20 or 30 cabinet footprints, are in the sweet spot. There’s some bigger, there’s some smaller, but that’s what we like to look for in terms of cabinets.

Jonathan, if I can just pile onto what Steve said, one of the things that was interesting this quarter was this was the largest sequential quarter-over-quarter increase in the number of cross-connects that we sold. And so that certainly tells us that we’re continuing to get strong interconnection activity across not only the new customer adds, but our existing customer base.

Jonathan, this is Jason here, just to give you a little color. One of the things I found interesting when you look at the incremental cross-connection to the US, a fairly decent sized chunk of that came out of sites like Chicago 1 and 2, where we’ve touched on how it’s essentially at its capacity, yet we still continue to drive cross-connects out of the financial sector. The other comment I was just going to make is when you look at the bookings in the US, it’s pretty consistent with the revenue segments we have with the network segments and digital media really driving the growth but still pretty good strength as we mentioned in the financial segment as well.

Thanks for piling on there. On the new investment opportunities as we look beyond 2008, what’s the pipeline looking like in terms of opportunities either in new regions or expansions in existing locations that might have an impact on 2009 CapEx?

We’ll stay focused primarily in core markets. As you all know, we’re looking at secondary markets and new markets all the time but what you should expect from us is a focus in core markets across the same segments that we’ve been focused on in the past, network, content, digital media, financial services and enterprise. Again, as I just mentioned, looking for a good blended mix between co-lo and interconnection. So we’re incenting our sales force that way, that’s how we’re going to market and I would say more of the same.

Finally spot pricing, I think you mentioned in Asia-Pacific that is going up. Is that equally the case in Europe and the US or is that kind of stable?

Certainly we’re seeing it go up. On the Asia markets we’re seeing strong performance in our UK and other markets in Europe. Across the US, our pricing direction really hasn’t changed. We’re shooting on a blended basis for 1650 per cabinet based on the guidance we have given everybody to the $1 billion target on the revenue line. We think that’s still a trend that we want to shoot for, recognizing that again, as a company we don’t assume perpetual price increases year over year, although we are looking at 3% to 5% pricing increases where we can increase that back to the customer.

Our next question comes from Sri Anantha -Oppenheimer.

Keith, I know you mentioned some of the growth especially in 1Q. Looking back at your guidance and looking back at the contribution from Europe, what specifically drove the strong contribution in Europe? Were there any large customer wins or were there a large percentage of cabinets coming online? Could you give us some details? Because if I remember my sense was when you gave us the guidance, the contribution from Europe was more going to be like $37 million to $38 million, but it looks like it came around $40 million right now?

We originally anticipated in 2008 that $150 million to $160 million on the European revenue line. There’s a couple of things, Sri, clearly we’re benefiting from a stronger currency. The other thing we benefited in Q1 from was that $1.4 million reserve reversal that we called out there. But overall, you’re seeing good growth across the markets where you have capacity. As Steve’s alluded to, there are a number of markets that we either are building in or have just recently finished completing the build and they’re reaching capacity levels very early in their introduction. That’s putting some pressure across some of our markets. But overall I’ll tell you that as a whole in Europe we’re seeing great momentum across the available markets and the price points are consistent with what we were expecting.

Which means as you look into 2008 guidance then, the contribution from Europe should be higher than what it is, 150 to 160?

On an absolute dollar basis it certainly will be larger but relative to the total revenue base I think it’s going to be relatively consistent with the distribution across our three regions. Two-thirds US and then sort of one-third between Asia and Europe and then when you break down non-US, it’s roughly two-thirds EU and one-third Asia.

When I’m looking at your guidance for Q2 and for the remainder of 2008, assuming that the ARPUs are going to increase steadily, it looks like most of the growth is going to come from a higher uptick or volume growth. Am I assuming that correctly here?

I think it’s going to be a combination. We’re selling our cabinets in our new sites at a much higher price point than our old sites or the cumulative average that we’re providing you today. So we’re going to get it both from volume and we’re going to get it, to some degree, from price.

Our next question comes from Mark Kelleher - Canaccord Adams.

I wanted to go back to one of the comments you made about the fill rates having increased at the beginning of the year, perhaps putting pressure on inventory at the back of the year. You’re 78% utilized, the Silicone Valley and DC 5 facilities will take some of the pressure off but could you get in a situation where you’re out of inventory by the end of the year?

Yes. There’s a couple of markets where the bookings pace and the fill rate has gone up, as we mentioned, a little bit faster than we predicted, quite a bit faster than we predicted and yes, it’ll put some pressure on us in those markets. But we’re moving as fast as we can on future phases to address that. But there will be a couple of markets in the US market that will be under some level of pressure for capacity. But we’ve got seven new openings happening here in the second quarter that heighten that. So we’re managing ourselves through that, but there’s a lot of activity going on here now, as we look across, 12 of the 18 markets we’ve got capacity going on.

Mark the other thing, Jason alluded to this, despite the fact that we might have some capacity constraints in some of our markets, Dallas has been an example of something we’ve had over the last few years. LA could be something that we see going forward. We still don’t have the opportunity to continue to sell power and cross connects if we run out of physical capacity. That still is an opportunity for us. The comments that Steve said, it really is more about making sure that you realize there’s a lot of moving pieces here and we’re being very judicious in how we manage our guidance going forward, taking into consideration that all markets aren’t going to rise and fall at the same time and so we have to be mindful that we could run out of capacity in a market that we have a very rich trend in today.

A good thing about that, we actually have a pretty good amount of cross-selling going on from one market to the other with the sales force and one market can actually sell into alternate markets. So it’s a lot of moving pieces, but it’s pretty well balanced.

Our next question comes from Colby Synesael - Merriman.

Great, thank you for taking my question. Actually I have two of them. The first one has to do with your cash balance, you are talking about how you guys are now having to expand as you start to run out of capacity potentially in some markets. What’s the minimum cash balance that you would be comfortable with? I think you mentioned you’d be at about $250 million by the end of the year. My second question is a little bit more broad. When you look at the competition you guys were expecting in some of your markets at the beginning of the year relative to where we are now, is that less or more? What I’m getting at is with the current economy are you seeing that some of your competitors aren’t necessarily able to get the capital that they need to build out their own facilities and as a result may be concerned about an over build is actually taking place?

As I said, at the end of this year I anticipate, given the working capital and some of the construction and progress that we will have relating to L.A. and maybe some other projects, we should have in excess of $250 million of cash. I think the sleep well factor, and I’ve said it for a fairly long period of time, I think $100 million of unrestricted cash on our balance sheet is appropriate. But recognizing as we go forward the amount of cash that this business is generating is certainly going to fund any incremental expansion that we see today. If you can moderate the expansion throughout a fairly consistent period and you manage your inventory well, I think it’s fair to say that we’re almost at an inflection point where we are fully self-funding. Having said that, we also are very mindful that at the end of the year we have some working capital to pay down and we have some debt will be coming due in 2009 and beyond and so we want to have a fair amount of liquidity to manage our affairs when we go through these tough economic times because access to capital, as you’re aware, is somewhat restricted. We want to make sure we raise capital under our terms versus more restrictive terms that you see today.

On the competitive part of the question, Colby, we are absolutely seeing early signs of capital constraint, not only from a customer perspective, but from a competitive perspective as you asked. There are reasons why companies are making decisions to come to this model because they’re avoiding the capital expense. We certainly see ourselves in a good position in key markets where our primary competition is unable to step up to the future installment, the future path that a customer needs, not only for an immediate delivery but future deliveries. So access to capital is a real issue in the current market conditions, there’s no question about it.

Are you guys actually then winning some customers that may have thought about building their own facility or expanding one of their own facilities, and as a result of the current market conditions they’re actually deciding to go with you guys?

For sure. That would probably be the same for, you go up the stack I’m sure the hosting folks are seeing that, I know the big outsourcing folks are seeing that, but we’re absolutely seeing that capital constraint -- it always has been and it’s heightened as a driver of a decision to come to this model, no question.

Our next question comes from Michael Rollins - Citigroup.

On the MRR per cabinet, you talked about some of the constraints that you’re seeing potentially in inventory later this year. As you think about managing volume mix for customers in terms of interconnection and so forth, as you think about the potential for price escalation, is there just an overall number that we should think about in terms of maybe over the next year or two years how much you can increase the MRR per cabinet in what we’ll call the heritage portfolio -- the US plus Asia, if you take just those two. Is there a number or range that we should be thinking about in terms of what you target as a company? As you look out in terms of generating potentially free cash flow at some point in the future, as indicated you’ll be self-funding potentially, how do you think about share repurchases versus the investments in new centers and expansions? If you could talk about that as well that would be great. Thanks.

Okay, so let me deal with the first question, Michael. When we deal with the heritage sites, so basically the original IBXs, we’ve done a very good job as a company in trying to stratify the customer base and get the higher interconnection-rich customers into those sites. So we’ve already got fairly good price points. But I think as you look forward on a go-forward basis, it’s fair to say that – and recognizing they’re in there, our customers tend to be relatively sticky and so they don’t move, it is reasonable to assume a 3% to 5% price increase. I also remind you, this is the higher interconnection-rich customers and we feel that those are the customers that on average are paying more per cabinet than maybe a large enterprise customer. That’s to reflect that, as you can appreciate, our costs are going up annually and so passing on some of that cost increase to our customers is appropriate.

Keith, it’s probably safe to say too that some of these customers we’ve had for a long time and that we tend to have long-term relationships that are quite meaningful to us so we’re going to be judicious about the price increase strategy.

The second question that you had was really about the point in time that we are self-funding, we have excess cash on our balance sheet we are still in a high growth phase. Certainly the company’s view is it is more appropriate to do a stock repurchase with any excess capital, assuming we’re not going to deploy it into the business than it is to do a dividend under a scenario where it’s high growth. I think all of our investors would expect that’s what we’d do if we had excess capital, repurchase the stock. But it’s really too early to guide to that. Clearly we’re in a very good position. It is early in 2008 and we’re also very mindful what can happen through the back end of this year. So we’re continuing to be somewhat conservative, and so I don’t want to tip our hand in any direction right now to what might happen in ‘09 or ‘10.

If I could just follow up to that, though. Do you look at for example, take a market like Secaucus, New York metro market and to the extent that that starts to hit the point, you actually talked before about potentially considering an expansion in that market, I think you mentioned it on the last call. Do you look at what that would cost and what the returns would be? Do you weigh that against how you view potential for share repurchase? Can you talk about whether you weigh some of those factors as you look at deploying new money into the business versus cash repatriation?

I think that’s a very good question, Michael. I mean clearly when our stock traded down to 57 this year, those are the type of questions that we do have to ask ourselves. Is it better to repurchase stock versus expanding the business under a scenario where we believe the company is undervalued or being undervalued? But certainly as we continue to trend up and if we can continue to expand the business with the return profile that we’re looking at I would argue that we’re probably better suited to continue to take that money and deploy it back into the business. But it is something that we consider and our preference certainly would be to as we look forward and we have the cash flow generating capacity to fund our future expansion and have excess cash, that’s the point that you can, to the extent that you need to de-lever some of the more dilutive instruments that we have in the marketplace or buy back stock.

Our next question comes from Rod Ratliff - Stanford Group.

A very, very nice quarter; nice upside surprise there. Most everything’s been asked and answered. Keith, speaking of engineering on the balance sheet, a couple of your mortgages are up there in terms of the interest that’s due on them or the interest that they bear. Is there any plan at all to possibly refinance some of that money at a lower rate?

Rod, the only mortgage that we have out there today is the mortgage on our Ashburn property. It is a fixed rate of 8% for 20 years, there is a yield maintenance through ten years and it is fairly prohibitive to actually try and take out that facility. It does not mean that we wouldn’t under the right set of circumstances. So I tell you today it is a little bit expensive. When we did the deal and over the last two, three quarters we thought it was pretty cheap money, but certainly with the base rate dropping as it has it has become a little bit more expensive today. I think on the long run it is going to be an appropriate financing mechanism for us. And as we go forward and the capital markets open back up, in fact I see that mortgage financing might be an even more appropriate source of capital going forward on some of our unencumbered assets such as Silicon Valley or Los Angeles or for that matter Chicago, when we have the ability to pay back that construction loan.

Other than FX, are there any particular industry verticals that can be singled out for notable strength?

In the recent quarter, probably network and content, our digital media segments. We saw strength across all four financial services, and the FX stuff we’ve talked about in the past and we’re still seeing great opportunity there. We have got a high growth rate. We’ve got a lot of activity. We’re focused on the right parts of that business. It’s a pretty complex global ecosystem, but we’re pretty well positioned to address the high bandwidth needs, the latency needs and the proximity needs that we see in that segment. So we’re very, very focused on that.

One last off the cuff comment, I got to say on behalf of some of my clients, if you guys started buying stock back, I think it would send the wrong message. In lieu of financing internally funded growth, I got to tell you, you if started buying stock back, you’d be chasing it downhill.

Thanks for the feedback, Rod.

Thanks, Rod.

Appreciate it.

Our next question comes from Jurgan Usman - Wachovia.

First of all, is there any change in the mix of your vertical segments? Have you seen any sign of strength or weakness in any of the verticals?

No, pretty straight strength across the board. I know that you’re trying to unravel the financial services segment with that question. We really haven’t seen any degradation at all with our current customer base in any of the segments and the new wins have come across all segments that we’re pursuing. It’s a very good balance.

You raised guidance twice already on the back of an economic slowdown here, which seems to suggest that obviously you guys are being conservative again this quarter with your new guidance.

Clearly we’ve raised guidance quite substantially coming into this new year and then certainly in this quarter we’ve raised it again. We really tried to tip our hat that we’re still wise to what’s going on in the broader economy. We’re also recognizing that we have a number of builds, or we certainly have a number of assets that could become capacity constrained and we have a number of assets that we’re currently building out and we’re sensitive to the timing of when we deliver them. So we’re wise to that as well. I’ll tell you that overall we feel we’ve got very good guidance out there. We broadened the range to up to $700 million and we think that was a meaningful step up when you look at what we’re offering in Q2 for our guidance. I don’t want to tell you any more than that, but clearly that the company really has been trying to get closer to our guidance ranges but the overall environment has really provided us an opportunity to meet and exceed. On a go-forward basis, I’d like to think that we could always do that, but our preference is to try and give you better guidance going forward.

Can you maybe let us know a little bit on your bad debt and DSO trends?

I did mention in my remarks our DSO trends on a global basis have basically improved. In the US we’re relatively low, in the low 30 days still. And then in both Asia and in Europe we saw our trends improve quite dramatically. So overall the company is in the low 30 days on a blended basis. When it comes to bad debts, we’ve seen a modest increase in our bad debt expense but nothing that’s outside of our expectations or outside of our budget levels.

Is it below 2% fair to say?

Bad debt is much lower than that. Again, we as a company have a philosophy, because our DSOs are so low, you can’t have bad debt and bad revenue in the same quarter. So by the time we close a quarter, we have fairly good visibility on who’s going to pay and who’s not going to pay. To the extent we see a customer at risk, we’re going to back out the revenues. So it never gets to bad debt, it becomes bad revenue and you never see it in our results.

Could you maybe provide me with the expected number of saleable cabinets as it stands right now for Q3 and Q4 this year?

What I’d like to do if I may, we’ve actually put something on our website dealing with the new expansions and the capacity and I’d like to defer you, if I could, to our investor relations website and you’ll see all the capacity that’s coming on and the quarters that we think it’s available.

Our next question comes from Tom Watts - Cowen and Company.

A couple of questions. One, I’ve talked to several other providers, one who recently instituted a 5% price increase for some of their existing space and another that actually instituted a 10% price increase just based on the strength of demand and limited supply, particularly in some markets. Your suggestions on pricing suggested that you are pricing higher powered space higher and more of a CPI. Is there an opportunity to take advantage of the shortages right now and lift prices more aggressively?

Tom, it’s a question that we’ve received in a number of cases and certainly when we meet some of our investors directly. But generally speaking, our response to that is that we think we are premium priced in the market today. I don’t dispute the fact that some of our peers may be increasing their prices 5% or 10% but it’s off a much lower base. We’re premium priced. We’re getting higher prices than we think anybody else is getting in the marketplace today. But probably more relevant is that we are in the service business and we know we can make it very difficult to some of our customers if we wanted to, but we want to continue to foster long-term relationships and the way that we address that is managing the price increases reasonably, consistent with CPI or a little bit above that to reflect some higher costing trends.

In terms of the industry verticals that your new orders are coming from, have you seen any shift in that? Particularly has there been any effect from the financial services vertical, positive or negative?

Tom, we haven’t seen any shift really at all. In this particular quarter we had a bigger jump in network and content companies than we’ve had in the past, but we had strong performance in financial services and the enterprise segment. So we’re pretty steady across all four segments and really have not seen any degradation in the financial services.

I saw one survey recently of enterprise IT executives that said 69% were going to run out of power in their existing facilities by the end of 2010. I’ve also seem some other space coming online with 200 watts per square foot, even expandable up to 300. Have you seen demand for going to those types of power levels? Because I think most of your builds now are about 150 watts per square foot. How flexible are you to increase power levels even further?

Pretty flexible. I think today in some of our sites we’re deploying in different configurations of it could be two, four, six up to eight. In some cases we’ve gone higher on isolated deployments. But there’s no questions that there’s, I’ll call it a data center obsolescence issue over the next two to five years where the power and cooling issues are surfacing to customers across the board. So as long as the Internet keeps growing at the pace it’s growing and we keep seeing this next generation infrastructure whether it’s storage arrays or high end blades or the high end routers that are being deployed, we’re going to be faced with this power and cooling challenge which is at the heart of this high power density configurations that we’re pushing to. So there is no question that that’s a key driver out there today as lots of old data centers are becoming more and more obsolete or pieces of them are becoming obsolete which is ceding the demand curve for us.

If you look at some of these data centers that enterprise built in the 80s and 90s, they didn’t factor that in. So we had a fairly high-quality power and cooling design to begin with but as some of these folks start building up, their data centers will run out of power given the environment just in general as they embrace outsourcing co-location and all the value that we have in our offering, that could drive demand because they don’t have to build their own data centers, plus they get the value of all of our operational quality and the number of networks that we have under the same roof.

Our next question comes from Manny Recarey - Kaufman Bros.

When you talk about the self-funding reaching free cash flow. Can you give a little bit of a timing on that? Is it something like a 2009 or is it beyond that that we’re looking at reaching that level?

Yes, Manny. Again, we didn’t really to give a timeline but it’s fair to say that as we look into 2009, the only meaningful CapEx that we’ve disclosed at this point where we’re going to spend capital dollars is our LA 4 property and given that scenario, obviously we could be in a situation where we generate meaningful cash flow in 2009. But also going back to Steve’s comments, there’s going to be some potential capacity constraints and as we go through each of our markets and analyze do we want to continue to expand, there could be some decisions that we have to make in 2009 where we deploy additional capital. So I don’t want to give you a date or a timeline because clearly it’s going to be dependent on what we see in front of us. The other thing that I think we’ve been looking at very seriously is that we’ve been designing the second phase of our New York 4 property and that has the potential to increase our capital needs in 2008 and potentially a bit in 2009. So under those scenarios, it’s a bit early to give you any concrete timeline. But 2009 is looking like a year of greater opportunity for us.

Our next question comes from Greg Mesniaeff - Needham. Greg Mesniaeff - Needham & Company: I just had a quick question on pricing. I was wondering if you can compare the recent pricing trends you’ve seen in your European operations versus US in terms of price increases?

You’d have to go into each market to get down to the real answer to that and we are seeing in both the Paris market and the Frankfurt market a good step-up in pricing trends. As you know and we’ve stated in the past, our London market has been at the high end of the pricing spectrum, so we’re staying pretty solid there. But we’re starting to see a pretty good lift in Europe and in the German and French market. Amsterdam is too early to tell and then in Switzerland it’s a smaller operation and it’s also been towards the higher end, towards the London market. But in the US, I don’t know if there’s a general trend Keith? I don’t know if you can go by market by market.

I think with the US being just a little bit more mature Steve and Greg, it would mean that we saw basically a year-over-year growth rate on a blended basis which taking into consideration volume, price and service of 7% year over year. I think what’s more relevant if you compare the momentum in Asia to that of Europe, we’re seeing great uptakes on our spot prices in our Hong Kong market, our Singapore market, a lesser extent, our Tokyo market and the Australian market’s just steady as they go. So overall we’re seeing more consistent trends in our non-US markets because the US has been at a higher price point fairly consistently over the last few years. So, that’s how I’d probably guide you, but overall we’re seeing all three regions in positive territory. Greg Mesniaeff - Needham & Company: Also given the weakness of the dollar, are you seeing any anomalies in your customer profiles in the US, maybe some of your European customers moving some activity here?

I wouldn’t say we’ve seen any meaningful change. I don’t think at this point at least for what we offer, is changing the buying pattern. But as a company, certainly with a third of our business being non-US, we’ll benefit from that on a go-forward basis assuming a consistent exchange rate across those key currencies.

This concludes our conference call today. Thank you for joining us.