EFTA01382696.pdf

S-1/A Table of Contrail businesses and financial institutions of all sizes and types and satisfy the increasing demand for more advanced capabilities. We also continue to find opportunities in developed economics to partner with financial institutions and technology providers to deliver innovative solutions to clients. We have also made strategic investments and developed key partnerships in fast-growing emerging markets such as India and Brazil where the penetration of electronic payments is lower and the use of more advanced commerce-enabling technologies is still nascent. In these markets. we have positioned ourselves to benefit from the rapid adoption of electronic payments by offering core solutions. such as merchant acquiring and card issuer processing, which we differentiate versus local vendors by utilizing our global scale, broad capabilities and deep industry expertise. In addition, we are leveraging the advanced features and functionality of the solutions we have created for our clients in developed markets to offer new commerce-enabling solutions to our clients in emerging markets that empower them with next-generation technology and capabilities to grow their businesses. We believe these imported capabilities are highly differentiated versus the often less-advanced offerings of local competitors. We employ a variety of go-to-market strategies across all of ow geographic regions basal on specific market dynamics, which can vary significantly based on the competitive landscape. the regulatory• environment, and local market preferences. In our OBS segment. we frequently partner with financial institutions through joint venture equity alliances, revenue sharing alliances, and referral partnerships to source new business leads via their retail branch networks. In some markets we also operate direct sales teams or partner with non-bank sales channels, such as independent sales agents. ISOs, ISVs. VARs, and PSPs to sell our commerce solutions to large. medium and small businesses. In our GE'S and NSS segments. we frequently utilize a direct sales model given the longer sales cycles and the greater diversity of needs between clients, and we leverage strategic referral partners, such as group service providers, like industry associations, system integrators. and IT consultancies, who recommend First Data's solutions to members and clients that they are advising on related projects. For more detail on our distribution capabilities, see "—Our Sales and Distribution.' North America North America (the United States and Canada) is our largest region. accounting for $5.3 billion of revenue and $2.2 billion of EB1TDA in 2014 (including Corporate expenses). We are the largest merchant acquirer. issuer processor, independent network services provider in the region. The United States is our largest market in the world and accounts for the majority of our activity in the region. In 2014, we processed approximately 64 billion commercial transactions and acquired $1.7 trillion of payment volume in the United States, accounting for nearly 10% of U.S. GDP. We provide our full range of technology solutions across all three of our business segments and have established a strong leadership position in all of our core businesses. We utilize all of our direct and indirect distribution channels in the United States, including three of our largest equity alliances. Bank of America Merchant Services. Wells Fargo Merchant Services and PNC Merchant Services. and our largest revenue sharing alliance, Citi Merchant Services. In the United States, we serve large businesses, such as national retail, supermarket and restaurant chains, as well as regional SMBs that are positioned across a wide range of industry verticals. In 2014, we serval approximately 4 million business locations in the United States and acquired 39% of U.S. credit and debit purchase volume according to The Nilson Report dated February 2015. We also serve financial institutions of all sizes and types including national and regional banks community banks, credit unions and non-bank issuers of retail private label cards. In the United States, we served approximately 3,900 financial institutions and had 785 million card accounts on file in 2014. To help route transactions between businesses and financial institutions, we own and operate the STAR Networt, which is the largest independent PIN debit and ATM network in the Unite! States, In 2014, STAR processed 3.6 billion transactions. The network serves our clients separately from ow Global Business Solutions and Global Financial Solutions segments and often facilitates transactions that are routed by our merchant acquiring competitors. In Canada, we serve similar types of clients and provide our core merchant acquiring, issuer processing, and °Commerce solutions by utilizing our U.S. platforms. We sell our commerce-enabling solutions 137 http/Antw.see.gov/Archivw/edgar/datat883980/000119312515334479/d31022dsla.htm110/14/2015 9:06:38 AM] CONFIDENTIAL - PURSUANT TO FED. R. CRIM. P. 6(e) DB-SDNY-0082156 CONFIDENTIAL SONY GM_00228340 EFTA01382696