Full Description

IDT Corporation (IDT), incorporated in 1995, is a multi-national holding company with subsidiaries spanning several industries. The Company’s principal businesses consist of IDT Telecom, which provides telecommunications services to consumers and businesses, including prepaid and rechargeable calling cards, a range of voice-over Internet protocol (VoIP) communications services, wholesale carrier services and local, long distance and wireless phone services; IDT Energy, which operates its Energy Services Company (ESCO) in New York State; Alternative Energy, which consists of American Shale Oil Corporation, (AMSO), which manages its 50% interest in American Shale Oil, LLC (AMSO, LLC), its United States oil shale initiative, and Israel Energy Initiatives, Ltd. (IEI), its Israeli alternative energy venture, and Zedge, which provides a Web-based, worldwide destination for free, user-generated mobile content distribution and sharing. The Company conducts its business through, three segments: Telecom Platform Services, Consumer Phone Services and IDT Energy. All other operating segments that are not reportable individually are included in All Other. Telecom Platform Services and Consumer Phone Services comprise the IDT Telecom division. On September 23, 2008, the Company sold a 10% ownership interest of Zedge Holdings, Inc. to Shaman II, L.P. In March 2009, TOTAL E&P Research & Technology USA (Total) acquired 50% interest in AMSO, LLC. On June 24, 2009, the Company acquired the 49% interest in Union Telecard Alliance, LLC (UTA). On September 14, 2009, the Company completed the spin-off of its CTM Media Holdings, Inc.

The Telecom Platform Services segment provides various telecommunications services, including prepaid and rechargeable calling cards, a range of VoIP communications services, and wholesale carrier services. The Consumer Phone Services segment provides consumer local and long distance services in the United States. The IDT Energy segment operates its ESCO in New York State that resells natural gas and electricity to customers throughout seven utility markets. All Other consists of Zedge, Alternative Energy (which consists of AMSO, which manages its 50% interest in AMSO, LLC and IEI), certain real estate investments and other smaller businesses and, up until the September 14, 2009 spin-off of CTM Media Holdings, Inc., the IDT Local Media businesses (principally CTM Media Group, WMET 1160AM and IDW Publishing). During fiscal 2009, All Other segment generated approximately 2.6% of its total revenue.

Telecom Platform Services

The Company’s prepaid products businesses accounted for over 48% of the revenues of its Telecom Platform Services segment during the fiscal year ended July 31, 2009 (fiscal 2009). The Company sells prepaid and rechargeable calling cards under the IDT, Entrix, DSA, LA LEYENDA, BOSS, Playball, GOOOL, RED, Feliz and PT-1 brand names, among others, providing telephone access to more than 230 countries and territories. The Company also sells select cards under the Net2Phone brand name, including the Net2Phone Direct and PennyTalk calling cards. It sells more than 1,000 different prepaid calling cards in the United States and more than 500 different cards abroad. Its prepaid calling cards are marketed primarily to the ethnic and immigrant communities in the United States, Europe, Asia and Latin America. The Company markets its prepaid calling cards to retail outlets in the United States through, UTA.

The Company’s Telecom Platform Services segment also markets customized (private label) retail calling cards. The Company prints these prepaid calling cards with the retailer’s name and logo and provide them to the retailer who, in turn, sells the cards to its customers. It markets IDT-Branded Retail Calling Cards. These prepaid calling cards are printed with the IDT logo and design and are sold to small and medium-sized retail chains, such as supermarkets, drug stores and convenience stores. Through UTA, the Company, resells a limited amount of calling cards of other providers of telecommunications in the United States. In addition, it sells top up wireless cards, primarily to small and medium-sized retail chains. It also sells gift cards and stored value cards, primarily to national retailers. The Company’s Telecom Platform Services segment carries its international telecommunications traffic and the international traffic of other telecommunications companies. As of July 31, 2009, the Company’s wholesale carrier services business had approximately 550 customers, including vendors IDT has over 1,100 carrier relationships worldwide.

In Europe, the Company markets its prepaid calling cards in the United Kingdom, the Netherlands, Spain, Germany, Belgium, France, Ireland, Italy, Luxemburg, Sweden, Switzerland, Denmark, Norway, Portugal, Austria and Greece. It offers over 500 different prepaid calling cards in Europe. It also markets the prepaid calling cards in Israel. It also provides wholesale carrier services to European telecom companies, including foreign state-owned or state sanctioned post, telephone or telegraph companies and Tier-1 carriers, new and emerging telephone companies, and value-added service providers. European operations’ revenues constituted 25.7% of IDT Telecom’s revenues from operations, during fiscal 2009. During fiscal 2009, prepaid calling cards constituted 24.6% of its European operations’ revenues, while wholesale carrier services represented 73.9%.

Consumer Phone Services

The Company provides its bundled local/long distance phone service in 11 states, marketed under the brand name IDT America. Its bundled local/long distance service, offered primarily to residential customers, which includes local, regional toll and domestic long distance calling. The Company also offers long distance service throughout the United States. As of July 31, 2009, it had approximately 29,000 active customers for its bundled local/long distance plans and approximately 99,400 customers for its metered long distance plans. Its customers are located in New York, New Jersey, Pennsylvania and California.

IDT Energy

IDT Energy operates as ESCO that resells natural gas and electricity to customers throughout seven utility markets in New York State. IDT Energy does not own electrical power generation, transmission, or distribution facilities, or natural gas production, pipeline or distribution facilities. During fiscal 2009, IDT Energy generated approximately 17.2% of the Company’s total consolidated revenue. As of July 31, 2009, IDT Energy serviced approximately 397,000 meters in New York State (228,000 electric and 169,000 gas).

The Company competes with AT&T, Verizon, Ibasis, STi Prepaid, InComm, Blackhawk Network, Coinstar, Qwest, Telefonica, France Telecom, KDD, Arbinet, Con Edison, Orange and Rockland, Central Hudson, National Fuel, National Grid USA, National Grid dba Key- span and Rochester Gas and Electric.