Ladies and gentlemen, good afternoon, and welcome to the Pitney Bowes' Second Quarter 2012 Earnings Results Conference Call. [Operator Instructions] Today's call is also being recorded. If you have any objections, please disconnect your lines at this time. I would now like to introduce your speakers for today's conference call: Mr. Murray Martin, Chairman, President and Chief Executive Officer; Mr. Michael Monahan Executive Vice President and Chief Financial Officer; and Mr. Charles McBride, Vice President, Investor Relations. Mr. McBride, we will now begin the call with the Safe Harbor overview. Please go ahead.

Thank you. Included in this presentation are forward-looking statements about our expected future business and financial performance. Forward-looking statements involve risks and uncertainties that could cause actual results to be materially different from our projections. More information about these risks and uncertainties can be found in our 2011 Form 10-K annual report and other reports filed with the SEC that are located in our website at www.pb.com by clicking on Our Company and Investor Relations. Please keep in mind that we do not undertake any obligation to update any forward-looking statements as a result of new information or developments. Now, our Chairman, President and Chief Executive Officer, Murray Martin, will start with an overview of the quarter. Murray?

Thanks, Charlie. Good afternoon, and thanks for joining us. I'll start by putting our overall performance this quarter into context. Mike will follow with the details on our second quarter results, and then I'll discuss our outlook for 2012. After the presentation, we'll take your questions. For the last few years, we've been on a journey to deliver long-term customer and shareholder value. We are fundamentally transforming our business processes, reducing our cost structure and diversifying our range of offerings beyond physical mail. During the quarter, we continue to make progress against these long-term goals. We also continue to see favorable trends in parts of our business despite ongoing economic uncertainty and fluctuations in currency. Although total revenue declined during the quarter, there was growth on a constant currency basis in 3 of our 7 business segments. And in 2 of the remaining segments, the rate of revenue decline has moderated. There are drivers, particularly in the enterprise group, that we anticipate will moderate year-over-year revenue declines in the second half of the year as compared with the first half of the year. These drivers include: expansion of e-commerce and direct mail opportunities in Mail Services, new print outsourcing services provided by management services and increased backlog of equipment orders for Production Mail. In the quarter, we signed a strategic partnership with ORION Holdings to provide print management services that create substantial cost savings and increased value for the global network of interpublic companies, groups, agencies and clients. We will provide a platform that supports ORION Printing worldwide, which includes project management, global network of selected printers, print outsourcing expertise and technology that provides visibility tracking and accountability to each project. Our Volly secure digital mail delivery service continues to add capabilities and partnerships which we believe will enhance its…

Thank you, Murray. Revenue for the quarter was $1.25 billion, which was a decline of 3% on a constant currency basis and an improvement versus the first quarter decline of 4.4%. Currency had a negative impact of approximately 2% this quarter. As a result, revenue declined 5% versus prior year on a reported basis. The company experienced continued growth in its Software and Mail Services segments when the impacts of currency are excluded. In the SMB Solutions Group, International Mailing had its third consecutive quarter of revenue growth when you exclude the impacts of currency. However, there continue to be declines in the North American SMB revenue streams. While revenue was also adversely impacted by weakness in the Production Mail and Management Services segments due to lower global economic activity, both segments had improving revenue comparisons against the prior quarter on a constant currency basis. Breaking down our revenue for the quarter between U.S. and non-U.S. operations, U.S. revenue declined by about 3%. Outside the U.S., revenue also declined by about 3% on a constant currency basis. Including the 7% adverse impact of currency, revenue declined about 10% outside the U.S. on a reported basis. Non-U.S. operations represented 31% of total revenue. Turning to our earnings before interest and taxes, or EBIT, it was $205 million this quarter. The EBIT margin was 16.5%, which was an increase of 70 basis points versus the prior year. EBIT margin continues to benefit from ongoing improvements in our operating efficiencies across the business as a result of our Strategic Transformation initiatives. Our EBIT margin also include the impact of investments in new products and services. We expect these investments will accelerate as we approach the launch of our Volly product and continue to invest in new e-commerce opportunities. On a segment basis, EBIT…

We have updated our 2012 annual guidance to reflect results year-to-date and weaker-than-originally-anticipated business conditions in the second half of the year. This is due in part to prolonged global economic uncertainty, especially in Europe. Our original earnings per share guidance did not anticipate the significant changes in currency that have occurred this year. Year-to-date, excluding currency, our revenues declined 4%, and adjusted earnings per diluted share were $1.02, which excludes $0.11 per share of tax benefit in the first quarter. Based on the results to date and expectations for the second half of the year, we now anticipate 2012 revenue, excluding the impacts of currency, to be in the range of flat to a decline of 4% when compared to 2011. This guidance assumes moderating revenue declines for the second half of the year. Additionally, we expect adjusted earnings per diluted share from continuing operations for 2012 to be in the range of $1.95 to $2.15, and GAAP earnings per diluted share from continuing operations to be in the range of $2.12 to $2.32. The updated earnings per share guidance reflects an adverse impact of $0.04 to $0.06 per share based on current foreign exchange rates. GAAP earnings per diluted share include $0.11 per share of net tax benefits and $0.06 per share from the sale of leveraged lease assets in Canada, both of which occurred in the first quarter of the year. Based on our strong cash flow performance year-to-date, we are increasing annual free cash flow range by $50 million. We now expect free cash flow to be in the range of $750 million to $850 million. We remain focused on our goals to deliver sustainable value for our stakeholders even as we operate in challenging economic conditions. We have made tangible progress in developing solutions to help customers manage their physical, their digital and their hybrid communication needs. We believe that these are the right strategies and are committed to enhancing the long-term growth and profitability of our business. Thank you, and now let's hear from you.

[Operator Instructions] Our first question today comes from the line of Shannon Cross from Cross Research.

My first question is just on sort of cash generation, cash usage. Clearly, you're using it to pay down debt. You didn't buy any stock this quarter. I'm sure you're painfully aware of where your stock price is at right now. So I'm just kind of curious, near term and even longer term, how you're thinking about cash flow generation and use of cash given all the different things that you can invest it in?

In terms of the use of cash, obviously, we've taken a balanced approach to how we use the cash we generate. Obviously, we provide a healthy dividend, which consumes about $300 million of cash on an annual basis and provides good foundational return to the shareholder. We've been investing back into the business, both through increased R&D and investments in things like Volly, as well as using some cash for paying out on our Strategic Transformation programs. So as we go forward, we'll continue to look at a balanced use of our cash flow for return to shareholders as well as to manage our overall debt portfolio.

Okay. And then, I guess, if you look at your SMB business, which clearly was under a fair amount of pressure or continues to be, what are the drivers -- I mean, I noticed you talked about supplies for copiers and printers, which I don't remember seeing in any recent releases. So I guess how much of what on do you think is recurring versus should start to alleviate? Just and is it still this just a matter of we need to look for small business creation before this division starts to sort of right itself?

The big -- there are a number of things there, Shannon. One, small business creation at the low end of the SMB market is important for placing units and creating growth. However, we are seeing the initiatives that we put in place starting to have some positive effect on the challenges that have been there. Our retention rates continue to improve with our customer base, so we are seeing fewer customers leave. And in the long-term, that will definitely help us from the revenue side. Also, the Connect+ system continues to place. And then as I mentioned, we've launched Web Connect, which is -- really brings web connectivity to the low end of the meter line and will then start opening up the ability to add web-based applications for those customers. So those are the areas that we see as mitigating. However, certainly, small business creation is what would create the greatest stimulus.

And then my last question, I guess, is -- and I think I know the answer to this, but I just would like to hear what you have to say. The post office clearly has this $5.5 billion, whatever it is, pension payment coming due. I understand that they actually have to fund all of their post-retirement benefits, I think, up front or however that works out. But just can you remind us how we might think about this from a Pitney standpoint? Any issues with potentially the post office purchasing large ticket equipment? Just anything that might come from what they're talking about right now?

Sure. First, we think that the post office has been taking a lot of actions and should be able to continue to take more actions to address its cost structure, and we're supportive of them in their initiatives in that regard. As to the effect to us, we do not sell large ticket items to the post office. We really are a provider for them. We provide services. So in our Mail Services business, we continue to see growth there as we handle more and more mail in the presort and now in the standard area, so both first class and standard. So we don't see there any issues there coming back directly. Certainly, any uncertainty about the post office can create people wondering which could have an indirect effect, but there would be no direct effect.

And just to be clear, in terms of an increase in postage or anything that might come out of that, there's been no specific announcements around that at this point, I believe. So in theory there's -- sometimes you have some ups and downs in terms of sales, depending on when rate increases and concerns around that, there's nothing that's pending in the next couple of quarters?

Not that we see there. Under postal reform, there are limitations on what rates can change, when and by how much. So those are pretty well baked into the system. And the postmaster has said that he's not looking to go outside of what their regulatory agreement is or ask for anything special at this point.

And next we'll go to the line of Julio Quinteros representing Goldman Sachs.

Maybe just to kind of come back to the first sort of set of questions earlier around -- the way, I guess, I was thinking about it, it was more around the pressures in the business, the declines that you're seeing, how long and how far can this last and you guys still be able to generate free cash flow? Because it seems like that's the disconnection that we -- I think when we talk to investors, the most -- that they seemed most focused on where you have, a steadily declining income statement, if you will, but the offsets on the free cash flow side continue to surprise in that. It is pretty resilient. So if you can give us maybe some view on how much more pressure you guys can tolerate before this annual free cash flow actually would start to decline more meaningfully in a more meaningful fashion, that would be kind of helpful.

Julio, it's Mike, just to touch on that. I think there's obviously a couple of factors that drive free cash flow, and certainly earnings are one. And I think what we've shown over extended period of time is an ability to manage our cost structure relative to the change in the revenue profile of the business. And that's represented in the fact that in that core mailing business we had 8 consecutive quarters of improving margins. So as we go through sort of the transition of the business, we have been managing the cost side of it. The other is we have been evolving to a model that requires less capital in terms of capital expenditures back into the business. And that's come down substantially over the last several years as we've moved to more digitally based products and lower costs in terms of delivering our products to our customers. In terms of the business model, obviously, as Murray talked to, there's a number of things that we're doing from a product and services perspective to diversify the revenue streams within the SMB business to be able to drive growth in the business on a revenue-per-customer basis. Obviously, lower rental asset investments but maintaining those revenue streams. And the finance receivables is where we see the biggest change over the period. And obviously, that's why we focused on equipment sales as a key driver to driving that finance receivables balance as we go forward.

Maybe just to put it more maybe around -- some context around numbers. If the revenue falls to 8% or 10% level, can you still achieve the $750 million to $850 million in free cash flow?

Well, putting it in context, the North American mailing business is now around 1/3 of our revenue base. So when we look at our overall cash flow, it's generated across the entire portfolio of businesses. And so as we look at the enterprise businesses and the opportunities we see there, that obviously has a mitigating factor to the core mailing business. And obviously, our objective in the core mailing business, as we've done in the international side of the business, attain stable meter base in Europe, which has been relatively flat for a few quarters now. The revenue has been up just slightly for the last 3 quarters. We're looking to drive a change in the U.S. or the North American business as well. We've also experienced positive meter growth in Canada as well. So we are seeing, particularly in the international market, some leveling of those businesses.

Our next question, please excuse the pronunciation if it's wrong, we'll go to Ananda Baruah from Brean Murray. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: I just was wondering if I can get a little more context around, Mike, your, I guess, free cash flow thoughts for the second half of the year, sort of lowering the EBIT and I guess raising by $50 million. I know you get the $50 million this quarter. So really, if you could just walk us through the mechanics of lowering of the EBIT, and I guess keeping kind of the base free cash flow assumptions the same for the second half of the year?

Yes, in terms of free cash flow for the second half of the year, obviously, our annual guidance is based on what we've achieved to date, and then looking out at what we would expect for the second half of the year. While the range of EPS has changed somewhat, that is not the single -- necessarily single biggest contributor to the free cash flow. Again, we are seeing a need for less capital in the business. We have seen a little bit more of a run off in the finance receivables relative to what we had originally incorporated in the guidance, but actually seeing less run-off than we saw last year. So it's less of a contributor to the free cash flow. So overall, I would say it's strong asset management, good working capital management and continued focus on the cost. As you've seen, we had margin -- EBIT margin expansion and significantly lower cost, which are helping support the EBIT number. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: And with, I guess, I think OpEx as a percentage of revenue, what was it, 34.1% this quarter? What -- I guess reasonably speaking, and you've been reducing that, I guess, how -- what's a -- I mean, how low can that reasonably go over some meaningful period of time do you think?

So what we do is focus on the absolute level of cost. And then ultimately, that margin or the ratio is going to be driven by our revenue performance. So I would say the fact that we were able to reduce it by 150 basis points despite revenue decline says that we have an opportunity as we go forward and able to drive more positive revenue performance. We have opportunity to bring that ratio down as we go forward. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Got it. And I know it's a bit early yet, but just to help us kind of guide us a little, what's -- free cash flow levels or generation potential for 2013, is there any sort of framework you can give us at this point of how you're thinking about that and how we should?

Yes, I would say, obviously, we haven't given any guidance around 2013. I would say if you look over the last several years, it's -- gives you the best indication of kind of what drives our free cash flow and I think we've been consistent in a range over the last several years. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Got it. So a similar range wouldn't be unreasonable from your perspective right now?

Like I said, we haven't given any '13 guidance at this point. But obviously, you've got our '12 guidance. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: And just last thing for me, just pension cash contributions for the remainder of 2012, what should we expect then? Just directionally, for 2013, do you think they will be similar or lower?

Yes, as far as 2012 is concerned, we made a major voluntary contribution in the first quarter. I don't expect any significant contributions over the balance of the year. There may be small amount of contributions around international plans, but nothing significant. In terms of 2013, there has been some adjustments to the regulations around pensions that would allow companies to not make contributions in 2013. So we'll evaluate that as we get closer to 2013, but we don't believe we'll have a mandatory requirement at this point. And today, we're over 90%, 92% funded in the plan. So we'll take that to consideration as we look at 2013.

Next question today comes from the line of Hale Holden representing Barclays.

I have 3 quick ones. Can you talk through the decision to redeem that -- the call of note early with cash versus refinance? What I'm specifically trying to get is where you think the right debt structure for the company is over the next couple of years? Do you continue to shrink the balance sheet with revenue? Or do you grow it because there's cheap financing or hold it in place?

Yes, in terms of redeeming the debt, we looked at the opportunity to -- with that debt coming due in October, we obviously monitor the markets. We were in a situation where we have sufficient free cash flow and cash on the balance sheet that we were able to redeem that debt, give ourselves flexibility. Obviously, we're focused on our ratings and given the contraction in the revenue or in the finance receivables base, we wanted to make sure that our debt portfolio was in a line [ph] as well. And so we chose to redeem that debt. As we go forward, obviously, what we would do from a debt perspective is dependent upon the growth in our business. Obviously, finance receivables is one of the biggest reasons why we have the debt on our balance sheet. And obviously, if we grow those finance receivables in the future, we would look at providing financing for that. And that, obviously, has a good return on it. So it would be a good use of debt. If we don't have uses for the debt, we will look at continuing to manage the balance sheet, keeping in mind both what's available in the markets, the cash we have available to us and what investments we have or need to make in the business.

Along the same lines, can you give any sense of what the U.S. cash balance was? And then if the working capital gains are permanent, like should we expect that to swing back at some point?

Let me answer the second one first. In terms of the working capital, we're pretty much in line on the year-to-date basis to where we were last year. We actually had some swings between the first quarter and the second quarter, which really had to do with the timing of payments at the end of the quarter. So, don't see that as unusual per se. There was some benefit on a year-over-year basis. In terms of the cash balances in the U.S., yes, we had, in the U.S., about $200 million altogether. Some of that is related to our banking entity, capital associated with that. Some of it is on deposit with the Postal Service related to our [indiscernible] business. But we obviously used a fair amount of our available cash in paying down the debt that we redeemed in the second quarter.

Great. And then my last question is on the Web Connect products, if I understand it correctly, it could be a replacement for the postal meters in small businesses. Can you sort of talk through the pricing to the customer on that? Is that cheaper for customers to take, which -- is it economic for customers to take? Or are the margins higher for you? There'll be no finance receivables associated with that, right?

So, first, on Web Connect I could break it into a couple of segments. There's what we call pbSmartPostage, which is a non-meter, cloud-based postal system. And that is -- and that does both postage and shipping. And that's sort of in the $10 to $15 a month range. Then you have the installed meter base, which tends to be in the $20-plus range. What Web Connect does is it adds the cloud functionality of the non-meter-based equipment to the meter. So the people that have a meter for doing postage can now do shipping easily out of the cloud. They can do printing sheets of stamps, et cetera, on their local printer in addition to their meters. So it creates a hybrid opportunity for the existing customer base to expand their capabilities around the device. It also then connects them via the Internet or broadband rather than telephone for updating their rates, updating their software, et cetera, and makes the experience significantly better on the meter. The meter does have advantages on many applications where people have things in the envelope before they go to print and that you can't do through a printer very easily. It usually jams or causes problems, and it doesn't require sticking things on the surface of the envelope. So we see really 2 markets: the non-meter market, which we will grow with smart postage; and then the expansion of the smart postage into Web Connect, which creates a hybrid product that gives all the functionality of the cloud-based offering plus the functionality of meter brought together in one connected environment.

Next we'll go to the line of Shannon Cross with Cross Research.

Just a couple of follow-ups. I guess my first is can you talk both geographically, as well as on a vertical basis, just what you're hearing from your customers. Are people feeling any better? Are people feeling worse? Hopefully not, but that might be the case. Just can you give us some idea of linearity in the quarter. Any economic color you can give would be great.

Well, I came back from Europe a couple of weeks ago, Shannon, I'd say there we're seeing a mixed environment across the different companies -- or countries. We are not in any significant way in the ones that have the biggest direct challenges. But certainly in the other larger companies that are involved in financing those, it does create an uncertainty in the market and concern about what their availability of cash will be. We have noticed that particularly in the government sector, in our Software business, governments, which are significant portion of our Software business in Europe, have really pulled back as their sitting on the concerns about debt in Europe. And are uncertain, I'd say, is the way I'd look at how they're going to proceed, and that has had some effect. Business itself, we're actually still seeing Production Mail moving reasonable in Europe, but it has -- it certainly has concerns around big ticket as the environment is there. When you come to the U.S., we have noticed a change in the index on confidence in small business that, that has compressed somewhat. And that is there, but we haven't seen anything particular. Certainly, in the large ticket in financial services, we did see some slowing in the first half of the year. But we are starting to see, as we have in the past, when there is a slowdown in that market, it is factory-based equipment that will require replacements. So we are seeing the backlogs improving in that space.

And during the quarter did it get -- I guess just within the quarter, not -- I know I'm probably picking nits here. But I'm just curious, did things get worse or better? Or was it sort of a similar kind of decline rate you saw through the quarter in general?

I think it sort of fluctuated from week-to-week and month-to-month. I don't think there's any consistent trend up or down.

Okay. And then can you provide any more details on sort of the business plans for Volly? How we should think about -- how you're thinking about charging for it, if there's been any change over the last quarter or so, as things have evolved? And perhaps how much of the revenue would come from sort of the Australia-type relationships versus just the traditional biller that saves money by utilizing Volly?

The financials will be based on the biller, not on the Australian market. That will occur only in very small markets where we might choose to partner, but that isn't really our focus. Our focus is on the billers cost to date and what Volly can do for them and our ability to share in that cost reduction. So that is the model that we see rolling out and the model that we've been signing billers up on. So we don't see any change there. We do see the enhancement, which I've talked about of adding payments so that it becomes an integrated solution. This is what our vision was from the beginning. And we have now brought our first payment provider in and are integrating that now, and that should be available at launch so that people will be able to receive and pay the bill in one closed environment.

And I would assume you're looking at bringing in as many payment options as possible so that it just becomes very seamless, is that fair?

Yes. We will certainly don't want to make it confusing. But the payment vehicle that we have brought in actually is fairly broad-ranged, so that people will be able to use both credit cards and bank for making payments. And that is a change from what most payment availability is today. It will also allow multiple banks. So people that have multiple banks to make payments will see this as a system that can deal with multiple banks, multiple bank accounts and multiple credit cards, and match those to what the biller will accept.

And our next question comes from Chris Whitmore with Deutsche Bank.

I wanted to ask about equipment margins in the quarter, those were a bit weaker than what I was expecting and down materially year-on-year. Can you provide some color on that line, please?

Yes, Chris, there's a couple of things affecting that. One is that in the core mailing business, we did do more new equipment placement versus lease extensions. So there is a little bit -- as we talked in the past, there's a favorable margin on the lease extension. There's obviously a little bit more cost when you have a new piece of equipment. That's a piece of it. The other 2 things affecting that equipment sales, if you remember, that DMT also drives that line. We did have a higher percentage of printer sales. The large production printer sales in DMT this quarter than we did last quarter. That has a lower relative margin because it is an OEM product. And then we have some ancillary businesses including office furniture in the Nordics. And they had a good-sized deal there this year that, again, given the nature of the product, doesn't have as high a margin as the traditional core mailing business. So those weighed on the margin as well.

Similar question for software. That also looked a little light coming off of last quarter's relative strength, a little color on that line?

Yes, in terms of software margin, I don't think there's anything particularly unusual there. I think there's a little bit around the mix of the license deals. I think last quarter we had a couple of pretty large license deals. The mix of licensing is a little bit less this quarter relative to the recurring revenue streams that don't have as much. There was also some investment in the channel as well that in terms of being able to put some of our products like Portrait into more global markets.

Okay. And I wanted to follow up on some of the earlier cash flow questions and specifically ask you about your credit rating and where do you place maintaining your credit rating versus all other priorities for use of cash. In other words, would you sacrifice the dividend to maintain a credit rating, or achieve a certain credit rating?

Yes, in terms of our credit rating, it's obviously important to us. I think the number of the actions that we've taken including reducing the debt outstanding are consistent with maintaining investment grade credit rating. In terms of the dividend, when we look at our free cash flow, our dividend is in the neighborhood of about 40% of our free cash flow. So we don't see this as a choice between the 2. We believe we generate sufficient free cash flow to support the dividend, and we think we're taking the right actions to maintain a healthy credit rating. And we think we can achieve a good balance between the 2 in the way we manage the business.

Have you received any feedback from the agencies?

We meet with the agencies regularly. But certainly, no feedback based on this quarter. Obviously, we're just out with it. But we meet with the rating agencies regularly, and they review both our public information as well as look at debt. And we believe certainly from debt ratio standpoint, we're in the bounds of the ratings that we have today. And then obviously, they apply their own assessment to the other factors that affect their view on ratings.

Okay. And then last one for me is around -- just an update on the general view towards restructuring. Where are we in terms of the last transformation initiative? Is that now fully complete? That's part one. And then part two, as you look at the demand environment and taking down your organic revenue expectations, et cetera, I get the point where you are contemplating additional restructuring actions going forward.

Sure. In terms of the Strategic Transformation program, the remaining activities are principally in Europe. We started Europe a little bit later than we did in North America. There's also a more involved process when you're doing changes in the organization to work through those changes. So we think that the European piece will be substantially complete by the end of this year. Obviously, then we'll get the annualized benefit of that in '13. There are other, I would say, remaining bits of programs going on now in the U.S. as well, but most are complete. I would say though that a number of the investments we've made in the Strategic Transformation program were geared at creating an infrastructure that gave us more flexibility, more variability of our costs. So as we evolved the portfolio and the revenue base, we have greater flexibility to continue to manage our costs relative to our revenue performance. We have a continuous improvement program to continue to look at costs across the business. So that is our primary focus today. We always look at the business for opportunities to further improve the cost structure.

We have a follow-up from Ananda Baruah with Brean Murray. [Operator Instructions] Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Yes, just a couple of quick ones for me. I believe meter installs actually improved in the March quarter. I think they were down mid-single digits from maybe down double digits, if I remember correctly in the December quarter. Can you tell us how they did in the June quarter?

Yes, in terms of overall meter base, you're talking about, Ananda? Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: I guess, yes. I think just the shipments for this quarter. Mike, I thought you gave the -- just on the cost, I thought you gave the metrics in the last couple of quarters.

Yes, we haven't given specific changes in the meter base, but we have seen improved retention rates in this quarter relative to last quarter and last year, and that's through a number of programs that we have in the business. It's through products like pbWebConnect that Murray referenced as well and through placement of products like Connect+ that is serving both the high end and the upper end of the mid-market. Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Got it, okay. Maybe that was it. And just the last one for me is the 6,000 companies that you're 50 -- that the 50 mailers have access to, are those companies -- do you know if those companies of 6,000 are currently enrolled in Volly?

Say that last part again? Ananda Baruah - Brean Murray, Carret & Co., LLC, Research Division: Do you know if the third-party mailers have signed up the 6,000 companies yet into Volly?

They have not signed the 6,000. They're in process of working. The way the implementation goes is we sign the biller. We then begin implementation of what is required for that particular biller to bring them and their client base into the network. They then move from there as we are putting in what I'd call the pipes to connect them. They then begin the work with their billers. And so that's an ongoing process. And so we are starting to connect those billers now, the 50. So that work is in process. And as that work progresses, they then go and progress with theirs.

Our last question comes from the line of Barbara Noverini with Morningstar.

I know you mentioned this a little bit previously, but can you talk a little bit about what is -- what you think is driving your improved retention rates in SMB? Is it discounting? Is it that you're offering a Web Connect deal to your meter customers? Maybe just a little bit more color on why you think that metric is improving.

I think there are a number of things that affect that. Firstly is we launched the Connect+ product, which is really significantly differentiated from other products in the market, so at the high end of the marketplace. We're continuing to see positive there. We're seeing reasons for our customers to stay with a higher-end machine rather than migrating down market. We've also been very focused over the last year, or 2 years actually, as we've gone through transformation to change the customer experience and change how we manage our customers, how we support our customers and how we interact with them and take away some of the challenges we might have had with customers in the past. We believe that is always an area for improvement and we've seen that occur. We also have been very proactive on looking at our customer base and seeing what the needs of the customer are that could create behavior changes. So if we are seeing changes in how they work, we can then proactively look at what they are using and how they're seeing value and helping them. So it's really using the tools that we're creating to help our customers help their customers, applying the same thing to us in our relationship with our customers. So I really think it's across the board. It isn't really focused on price. It's really focused on changing the interaction with the customer and ensuring that the right value proposition is in place for the customer.

Got it. And I know that last quarter, you guys have mentioned your agreement with Facebook. And do you have any additional detail or any updates on that?

That deal is in place. It is -- the implementation has been rolling into Facebook this quarter. They will start developing apps on top of that platform and creating their database. So that is -- it will be multi-quarter for them to be able to take the technology and begin the embedding into it. So we're working with them on a constant basis on putting that technology in and making it available for their developers.

Speakers, there are no further questions at this time.

Thank you. During the quarter, as we've mentioned, we've continued to make some tangible progress against our long-term goals to create more value for our stakeholders despite the uncertain macroeconomic environment. Though total revenue declined during the quarter, there was growth on a constant currency basis in 3 business segments and revenue decline lessened in 2 other segments. We believe there are drivers that will moderate our year-over-year revenue decline in the second half of the year, including the expansion of e-commerce and direct mail opportunities in our mail services business, new print outsourcing services provided by Management Services and the increased backlog of equipment orders for Production Mail. We continue to develop and launch a range of new solutions to help customers manage their physical, their digital and their hybrid communication needs in the quarter such as Connect+ and pbWebConnect, as well as made ongoing progress in the preparations for the launch of Volly. We believe that these are the right strategies, and we are committed to enhancing the long-term growth and profitability of our business. Thank you.

Ladies and gentlemen, that does concludes our conference for today. We thank you for your participation and for using the AT&T Executive Teleconference. You may now disconnect.