SOURCE 35 years of Innovation and Vision SOURCE Inc. was founded in 1971 when David Potter, a student in his final semester at Southern Methodist University in Dallas, bought and sold his first used telephone system. A born entrepreneur and leader, David quickly realized the opportunity to leverage a poorly managed segment of corporate telecom, that of used telecom equipment, which was inherent in AT&T, its Bell Operating Companies (BOCs) and other large operating companies such as GTE. What he didn't realize at that time, was that he had taken the first step at building one of the strongest and most innovative companies in the communication industry. Looking back over the past 35 years, SOURCE has witnessed the rise and fall of the communication industry, while becoming a memorable part of telecom history. Following are some of the most notable events that helped shape telecommunications today, and SOURCE's involvement along the way to create new opportunities and options for customers. 1971 - SOURCE is founded. SOURCE profits by buying and selling equipment from the BOCs and GTE, capitalizing on the fact that these entities were regulated, had a guaranteed rate of return on their investments and a lack of knowledge regarding their costs. This used equipment was then redeployed, both domestically and internationally, meeting the needs of less technologically advanced areas. 1978 - SOURCE contracts with Western Electric and later SNET and NY Tel, to replace NEC systems (i.e.: NA409-crossbar). SOURCE in turn resells them to hotel chains for installation at their properties. 1980 - PacBell has 6000 PABXs in service to be displaced by Western Electric's "new" system - the "Dimension PABX". SOURCE enters into an agreement with PacBell to purchase and remarket the displaced sets. The agreement is in effect until 1984, when divestiture brought it to an end. 1981 - IBM introduced the first desktop computer. 1983-84 - SOURCE installs its first mainframe computer and begins development of its inventory management system to value and track equipment. The company uses a Pick Operating System to database detailed information on customers' parts and system sales. Sales representatives are given access, via 'dumb terminals,' to this invaluable information regarding costs, sales values and volumes. This places SOURCE reps in a highly competitive sales position, armed with a database of sound, current knowledge. 1984 - Divestiture. The government directive regionally splits the BOCs, leaving them to provide local service while AT&T retains the long distance business. AT&T is awarded the embedded customer base, as well as all residential phone equipment and business systems. The BOCs are forced to start from scratch to build both a customer base and to equip its customers. SOURCE benefits through equipment sales and equipment liquidation. 1989 - SOURCE introduces Serialized Bar coding to identify, audit and track inventory. This allowed SOURCE to bid against companies on pricing and develop product histories for sales and maintenance. 1990-92 - SOURCE upgrades its computer to a Data General, converts Pick to UNIX based software to provide higher speed processing and the ability to integrate serialization and requiring a total rewrite of inventory management software. Again, the investment in IT provided the needed flexibility for SOURCE to compete with larger companies in new equipment sales and implementation. This technology was integral to support David's corporate vision and adapt to changing market needs. 1992 - SOURCE purchases all Dimension PABX returns from AT&T, converting to serialized replacement parts. This provided reporting information that led to identification of a defective part within the switch, ultimately reducing monthly Dimension returns from 6,000 to 2,000. 1996 - SOURCE and Avaya partner, providing SOURCE with additional new product sales. 2000 - Industry stocks drop $4.3 trillion in market value. Over deployment and duplication drove costs down for customers. David ushered SOURCE into the next era of communications by capitalizing on the deployments of others. 2001 - SOURCE invests $1 million, expanding facilities by 215,000 square feet, consolidating and updating the Distribution, Repair and Testing Center, and bringing total facilities to 325,000 square feet. 2004 - FCC rules that electric power companies could use its wiring for Internet service, including VoIP. This industry altering decision will allow small companies to compete in the IP market. 2005 - Southwestern Bell, known more recently as SBC, purchases AT&T, completing the cycle of change that began with divestiture. Though most companies continue to morph into different names, SOURCE has always been SOURCE. 2006 - SOURCE celebrates 35 years under the same leadership and corporate name. Looking forward, expect to see SOURCE investing in the user-side of communications and focusing on quality of service. From a 5,000 to 325,000 square foot of office and warehouse space, SOURCE has continued to grow throughout the turbulent industry times, making telecom smarter. SOURCE has made a steadfast commitment to IT and innovation that has proved to be the cornerstone to Powering Business Communication.

Trivia Which one of these isn’t a SOURCE campaign of the past?   a) Radically Rethinking   b) Save the Phones   c) Second to None   d) Dial SOURCE How much was a gallon of gas in 1971?   a) $0.22   b) $0.38   c) $0.56   d) $0.90 Which one of these slogan debuted in 1971?   a) "Just Do It"   b) "I’d like to buy the world a coke…"   c) "What’s in your wallet"   d) "Got Milk?" David Potter then:              David Potter now: