10-Q

UNITED STATESSECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-Q

x Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the quarterly period ended June 30, 2012.

or

¨ Transition report under Section 13 or 15(d) of the Securities Exchange Act of 1934

Commission file number: 0-25940

GLOWPOINT, INC.
(Exact Name of Registrant as Specified in its Charter)

Delaware (State or Other Jurisdiction of
Incorporation or Organization) 77-0312442 (I.R.S. Employer Identification No.)

430 Mountain Avenue, Suite 301, Murray Hill, NJ, 07974
(Address of Principal Executive Offices, including Zip Code)

(973) 855-3411
(Registrant’s Telephone Number, including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes x  No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act.)

Yes o No x

The number of shares outstanding of the registrant’s common stock as of August 13, 2012 was 25,593,967.

GLOWPOINT, INC.

Index

PART I – FINANCIAL INFORMATION
Item 1. Financial Statements	1
Condensed Consolidated Balance Sheets at June 30, 2012 (unaudited) and December 31, 2011	1
Unaudited Condensed Consolidated Statements of Operations for the six and three months ended June 30, 2012 and 2011	2
Unaudited Condensed Consolidated Statement of Stockholders’ Equity for the six months ended June 30, 2012	3
Unaudited Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2012 and 2011	4
Notes to unaudited Condensed Consolidated Financial Statements	5
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	14
Item 3. Quantitative and Qualitative Disclosures about Market Risk	21
Item 4. Controls and Procedures	21
PART II – OTHER INFORMATION	21
Item 1. Legal Proceedings	21
Item 1A. Risk Factors	21
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	21
Item 3. Defaults upon Senior Securities	21
Item 4. Mine Safety Disclosures	22
Item 5. Other Information	22
Item 6. Exhibits	23
Signatures	24

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GLOWPOINT, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value, stated value and shares)

	June 30, 2012			December 31, 2011
ASSETS	(Unaudited)
Current assets:
Cash	$	1,689		$	1,818
Accounts receivable, net of allowance for doubtful accounts of $149 and $147, respectively	3,041			2,520
Prepaid expenses and other current assets	382			330
Total current assets	5,112			4,668
Property and equipment, net	4,325			4,738
Other assets	68			59
Total assets	$	9,505		$	9,465
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Revolving loan facility	$	750		$	750
Current portion of capital lease	219			177
Accounts payable	1,369			1,382
Accrued expenses	405			1,024
Accrued sales taxes and regulatory fees	514			434
Customer deposits	167			139
Net current liabilities of discontinued operations	—			50
Deferred revenue	175			235
Total current liabilities	3,599			4,191
Long term liabilities:
Capital lease, less current portion	320			334
Total long term liabilities	320			334
Total liabilities	3,919			4,525
Commitments and contingencies
Stockholders’ equity:
Preferred stock Series B-1, non-convertible; $.0001 par value; $100,000 stated value; 100 shares authorized and 100 and 100 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively, liquidation value of $10,000	$	10,000		$	10,000
Preferred stock Series A-2, convertible; $.0001 par value; $7,500 stated value; 7,500 shares authorized and 53 and 94 shares issued and outstanding at June 30, 2012 and December 31, 2011 recorded at fair value, respectively, and liquidation value of $396 and $704, respectively.	167			297
Common stock, $.0001 par value;150,000,000 shares authorized; 25,713,407 and 25,180,000 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively	3			3
Additional paid-in capital	159,695			159,339
Accumulated deficit	(164,279		)	(164,699		)
Total stockholders’ equity	5,586			4,940
Total liabilities and stockholders’ equity	$	9,505		$	9,465

See accompanying notes to condensed consolidated financial statements.

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GLOWPOINT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)

(Unaudited)

	Six Months Ended June 30				Three Months Ended June 30
	2012		2011		2012		2011
Revenue	$	13,546	$	13,935	$	6,800	$	6,954
Operating expenses:
Network and infrastructure	4,221		4,883		2,145		2,471
Global managed services	3,461		3,873		1,765		1,979
Sales and marketing	1,864		1,824		878		902
General and administrative	2,652		2,688		1,302		1,282
Depreciation and amortization	865		573		425		297
Total operating expenses	13,063		13,841		6,515		6,931
Income from operations	483		94		285		23
Interest and other expense:
Interest expense, net	29		32		18		14
Amortization of deferred financing costs	29		31		14		16
Total interest and other expense, net	58		63		32		30
Income (loss) from continuing operations	425		31		253		(7		)
Income from discontinued operations	—		18		—		24
Income before provision for income taxes	425		49		253		17
Provision for income taxes	5		—		5		—
Net income	$	420	$	49	$	248	$	17
Net income per share:
Continuing operations	$0.02		$0.00		$0.01		$0.00
Discontinued operations	$0.00		$0.00		$0.00		$0.00
Basic net income per share	$0.02		$0.00		$0.01		$0.00
Continuing operations	$0.02		$0.00		$0.01		$0.00
Discontinued operations	$0.00		$0.00		$0.00		$0.00
Diluted net income per share	$0.02		$0.00		$0.01		$0.00
Weighted average number of common shares:
Basic	24,440		20,714		24,525		20,753
Diluted	25,742		24,594		25,874		24,594

See accompanying notes to condensed consolidated financial statements.

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GLOWPOINT, INC.
CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

Six Months EndedJune 30, 2012

(In thousands, except shares of Series B-1 and A-2 Preferred Stock)

(Unaudited)

	Series B-1 Preferred Stock			Series A-2 Preferred Stock					Common Stock
	Shares	Amount		Shares		Amount			Shares		Amount		Additional Paid In Capital		Accumulated Deficit			Total
Balance at January 1, 2012	100	$	10,000	94		$	297		25,180		$	3	$	159,339	$	(164,699	)	$	4,940
Net income	—	—		—		—			—		—		—		420			420
Stock-based compensation	—	—		—		—			—		—		219		—			219
Issuance of restricted stock	—	—		—		—			536		—		—		—			—
Forfeiture of restricted stock	—	—		—		—			(110	)	—		—		—			—
Preferred stock conversion	—	—		(41	)	(130		)	102		—		130		—			—
Exercise of options	—	—		—		—			5		—		7		—			7
Balance at June 30, 2012	100	$	10,000	53		$	167		25,713		$	3	$	159,695	$	(164,279	)	$	5,586

See accompanying notes to condensed consolidated financial statements.

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GLOWPOINT, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)

(Unaudited)

	Six Months Ended June 30
	2012			2011
Cash flows from Operating Activities:
Net income	$	420		$	49
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	865			573
Bad debt expense	52			(9		)
Amortization of deferred financing costs	29			31
Loss on disposal of equipment	10			(12		)
Stock-based compensation	219			147
Increase (decrease) attributable to changes in assets and liabilities:
Accounts receivable	(573		)	(151		)
Prepaid expenses and other current assets	(52		)	(100		)
Other assets	(38		)	(43		)
Accounts payable	(13		)	(444		)
Accrued expenses, sales taxes and regulatory fees	(539		)	(258		)
Customer deposits	28			(85		)
Deferred revenue	(61		)	39
Net cash provided by (used in) operating activities – continuing operations	347			(263		)
Net cash (used in) provided by operating activities - discontinued operations	(50		)	40
Net cash provided by (used in) operating activities	297			(223		)
Cash flows from Investing Activities:
Proceeds from sale of equipment	11			—
Purchases of property and equipment	(353		)	(554		)
Net cash used in investing activities	(342		)	(554		)
Cash flows from Financing Activities:
Proceeds from exercise of stock options	7			—
Principal payments for capital lease	(91		)	—
Net cash used in financing activities	(84		)	—
Decrease in cash and cash equivalents	(129		)	(777		)
Cash at beginning of period	1,818			2,035
Cash at end of period	$	1,689		$	1,258
Supplement disclosures of cash flow information:
Cash paid during the period for interest	$	29		$	32
Non-cash investing and financing activities:
Settlement of liabilities with restricted stock and stock options	$	—		$	48
Property and equipment purchased with common stock	$	—		$	1,581
Acquisition of network equipment under capital lease	$	120		$	512
Preferred stock conversion	$	130		$	—

See accompanying notes to condensed consolidated financial statements.

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GLOWPOINT, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTSJune 30, 2012

(Unaudited)

Note 1 - Basis of Presentation

The Business

Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”) is a provider of cloud managed video services. Our services, delivered via our cloud-based OpenVideo™ platform, are securely accessible via any network (private or public) and are technology-agnostic. The Company delivers services to more than 500 different enterprises in over 35 countries supporting thousands of video endpoints, immersive telepresence rooms, and infrastructure for business-quality, real-time, two-way visual communications.

Glowpoint, a Delaware corporation, was formed in May 2000. The Company operates in one segment and therefore segment information is not presented.

Glowpoint's services are categorized as follows:

Monitoring & Management Services and Collaboration Services (“Managed Services Combined”). We provide end-to-end cloud managed services for telepresence, conference room, desktop, mobile solutions, and video infrastructure. We have a team of video experts utilizing the latest in remote management technologies. These engineering and operational customer support resources operate out of our three Video Network Operations Centers (VNOCs) located in the United States, in California, Pennsylvania, and New Jersey. These VNOC facilities provide global 24/7 support to our network and managed service customers, including our wholesale branded partners customers.  The primary functions of these operational resources located in these centers are customer service, conference production, network operation monitoring and remediation, and help desk technical support.

The company also maintains Points-of Presence (POP's) that houses the technology and infrastructure along with the servers and database warehousing for the OpenVideo platform and support systems of the business. There are currently three Points-of-Presence (POPs) located in the United States (New Jersey and Chicago) and United Kingdom (London), with additional POPs planned as needed. These carrier-neutral data centers are co-location facilities where network equipment that serves our video infrastructure is housed and acts as shared or dedicated infrastructure for our business customers. The POPs provide power redundancy & UPS (uninterrupted Power Supply) systems, which are constantly monitored and maintained. They also have physical security, flood controls, fire detection and suppression systems and are structurally designed for earthquakes.

We offer a complete portfolio of remote monitoring and management services that can help make video more widely available, improve up-time, drive higher usage, off-load IT teams, or all of the above. Our service packages can be customized to suit the needs of the business, whether for a large enterprise, small or medium sized business.

Glowpoint provides wholesale programs and private-labeled resale options for hardware manufacturers, network operators and systems integrators seeking to offer video services as a value-added addition to their collaboration and communications offerings. All of Glowpoint's unique features and services have been designed so that the entire suite can be private labeled by other service providers or companies who want to integrate video communications into their existing products quickly and cost effectively. Glowpoint will provide all of the video infrastructure and support, including customer portals and billing applications, as a private label service for a third party. This means that our services are branded with the other company's name, logo and other information, our live operators answer calls using the other company's name, and the other company's end user customers view the service as provided by that other company even though it is actually “powered by Glowpoint.” Glowpoint has been involved in a number of private label opportunities and currently provides branding of its services to six strategic global partners whom serve 147 customers with these services and support from Glowpoint through their unique brands. These services account for approximately 37% of Glowpoint's total revenue for the six months ended June 30, 2012. Many strategic global companies in the unified communications industry have recognized Glowpoint's value to their own sales and marketing efforts. These strategic partnerships are core to the company's global sales strategy.

Glowpoint's collaboration services, hosted via the OpenVideo™ cloud, are designed to connect video users all over the world whether they are on immersive telepresence, conference room, desktop or mobile devices. Customers

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that are registered to the OpenVideo™ cloud can connect to any other customer in the OpenVideo™ cloud and get access to Glowpoint's full suite of cloud managed video services, including the Virtual Video Room, video bridging, and webcasting services. Through our extensive partnerships, OpenVideo™ customers can also have business-to-business connectivity across other service providers platforms.

Network Services.In order to provide customers with access to the OpenVideo™ cloud, Glowpoint maintains a dedicated video overlay network. With our network services, we provide customers with the flexibility to either source the entire network from a single provider, maintain existing network and extend a logical connection to the OpenVideo™ cloud or bring bandwidth to OpenVideo™ datacenters. Although a declining component of our revenue stream, we believe that network services will continue to be an integral part of our revenue mix in the future, driven by new connectivity needs to connect and peer with Glowpoint's OpenVideo™ cloud.

Professional and other services. With the growing interest in convergence and the desire by some enterprises to add the transport of video to their enterprise networks, we have provided professional services and believe the market for such services is growing. Additionally, our extensive knowledge of all leading video conferencing vendors' equipment makes our video engineers a valuable resource for manufacturers, partners and end users on an outsourced basis. While our primary focus is generating monthly recurring revenue from our subscription services, our professional services have been a valuable lead for video communication opportunities leading to sales of our managed video services.

We have bundled certain components of our managed services to offer video communication solutions for broadcast/media content acquisition and event services. Customers have used our managed video services during events to cost-effectively acquire video content for broadcasters, cable companies and other media enterprises, especially in the sports, news and entertainment industries. While it includes our core managed video services, IP-based broadcasting and event services require more project management and dedicated operational and engineering personnel than our standard subscription services. Rather than using an expensive satellite feed, companies can acquire broadcast-quality standard or high definition footage at a fraction of the cost from Glowpoint over a dedicated IP connection. Since 2002, we have provided this service to ESPN during the professional football and basketball drafts. ESPN has used our service for interviews from team locations with coaches, players and analysts during their coverage. In 2007, we launched a High Definition (HD) content acquisition solution that we branded TeamCamHD and RemoteCamHD. This offering provides two-way HD video communication for content acquisition from remote locations. Glowpoint now provides a full suite of HD solutions for the broadcast, entertainment and media industry and is considered a high-quality alternative to the traditional means of acquiring content in many applications, including interviews and even full motion video.

Liquidity

For the six months ended June 30, 2012, we had net income of $420,000 and a positive cash flow from operations of $297,000. As of June 30, 2012, we had $1,689,000 of cash, positive working capital of $1,513,000 and an accumulated deficit of $164,279,000. In June 2012, the Company renewed its Revolving Loan Facility (as discussed in Note 10) pursuant to which the Company may borrow up to $5,000,000 for working capital purposes and under which we had unused borrowing availability of approximately $2,662,000 as of June 30, 2012. The Revolving Loan Facility matures in June 2014. Pursuant to the terms of our Series A-2 Preferred Stock and Series B-1 Preferred Stock, the Company will be obligated to pay dividends commencing on January 1, 2013. Based primarily on our efforts to manage costs and our Revolving Loan Facility, along with our cash flow projection, the Company believes that it has, and will have, sufficient cash flow to fund its operations through at least August 31, 2013. We have historically been able to raise capital in private placements as needed to fund operations and provide growth capital. There can be no assurances, however, that we will be able to raise additional capital as may be needed or upon acceptable terms, or that current economic conditions will not negatively impact us. If the current economic conditions negatively impact us and we are unable to raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company.

Quarterly Financial Information and Results of Operations

The condensed consolidated financial statements as of June 30, 2012 and for the six and three months ended June 30, 2012 and 2011 are unaudited and, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2012, and the results of operations for the six and three months ended June 30, 2012 and 2011, the statement of stockholders’ equity for the six months ended June 30, 2012 and the statement of cash flows for the six months ended June 30,

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2012 and 2011. The results for the six and three months ended June 30, 2012 are not necessarily indicative of the results to be expected for the entire year. While management of the Company believes that the disclosures presented are adequate to make the information not misleading, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2011 as filed with the Securities and Exchange Commission with our Form 10-K on March 8, 2012 (the “Audited 2011 Financial Statements”).

Note 2 – Summary of Significant Accounting Policies

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Glowpoint and our wholly-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation.

Use of Estimates

Preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates made. We continually evaluate estimates used in the preparation of the condensed consolidated financial statements for reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. The significant areas of estimation include determining the allowance for doubtful accounts, deferred tax valuation allowance, accrued sales taxes, the estimated life of customer relationships and the estimated lives and recoverability of property and equipment.

See “Summary of Significant Accounting Policies” in the Company’s Audited 2011 Financial Statements for a discussion on the estimates and judgments necessary in the Company’s accounting for the allowance for doubtful accounts, financial instruments, concentration of credit risk, property and equipment, income taxes, stock-based compensation, and accrued sales taxes and regulatory fees.

Accounting Standards Updates

There have been no recent accounting pronouncements or changes in accounting pronouncements during the three months ended June 30, 2012, as compared to the recent accounting pronouncements described in the Company’s Audited 2011 Financial Statements, that are of material significance, or have potential material significance to the Company.

Revenue Recognition

Revenue billed in advance for monitoring and management services is deferred until the revenue has been earned, which is when the related services have been performed. Other service revenue, including amounts passed through based on surcharges from our telecom carriers, related to the network services and collaboration services are recognized as service is provided. As the non-refundable, upfront installation and activation fees charged to the subscribers do not meet the criteria as a separate unit of accounting, they are deferred and recognized over the 12 to 24 month period estimated life of the customer relationship. Revenue related to professional services is recognized at the time the services are performed, and presented as required by ASC Topic 605 “Revenue Recognition.” Revenues derived from other sources are recognized when services are provided or events occur.

Taxes Billed to Customers and Remitted to Taxing Authorities

We recognize taxes billed to customers in revenues and taxes remitted to taxing authorities in our operating costs, network and infrastructure. For the six and three months ended June 30, 2012, we included taxes of $796,000 and $393,000, respectively, in revenues and we included taxes of $764,000 and $372,000, respectively, in network

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and infrastructure costs. For the six and three months ended June 30, 2011, we included taxes of $846,000 and $415,000, respectively, in revenue and we included taxes of $801,000 and $392,000, respectively, in network and infrastructure costs.

Long-Lived Assets

We evaluate impairment losses on long-lived assets used in operations, primarily fixed assets, when events and circumstances indicate that the carrying value of the assets might not be recoverable as required by ASC topic 360 “Property, Plant and Equipment.” For purposes of evaluating the recoverability of long-lived assets, the undiscounted cash flows estimated to be generated by those assets are compared to the carrying amounts of those assets. If and when the carrying values of the assets exceed their fair values, then the related assets will be written down to fair value. In the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

Capitalized Software Costs

The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350.40 “Intangible – Goodwill and Other – Internal-Use Software.” Capitalized software costs are included in “Property and Equipment” on our consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. For the six and three months ended June 30, 2012, we capitalized internal use software costs of $161,000 and $77,000, respectively, and we amortized $279,000 and $139,000, respectively, of total software costs. For the six and three months ended June 30, 2011, we capitalized internal use software costs of $197,000 and $72,000, respectively, and we amortized $127,000 and $66,000, respectively, of these costs. During the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

Note 3 – Stock Options

We periodically grant stock options to employees and directors in accordance with the provisions of our stock option plans, with the exercise price of the stock options being set at or above the closing market price of the common stock on the date of grant. The intrinsic value of options outstanding and exercisable at June 30, 2012 and 2011 was $143,000 and $108,000, respectively. Options exercised during the six and three months ended June 30, 2012 were 5,000 and 0, respectively. Options exercised during the six and three months ended June 30, 2011 were 124,000 and 64,000, respectively.

The weighted average fair value of each option granted is estimated on the date of grant using the Black-Scholes option valuation model with the following weighted average assumptions during the six and three months ended June 30, 2012 and 2011:

	Six Months Ended June 30,		Three Months Ended June 30,
	2012	2011	2012	2011
Risk free interest rate	0.9%	2.1%	0.7%	N/A
Expected option lives	5 Years	5 Years	5 Years	N/A
Expected volatility	111.2%	117.4%	109.7%	N/A
Estimated forfeiture rate	10%	10%	10%	N/A
Expected dividend yields	—	—	—	—
Weighted average grant date fair value of options	$2.37	$1.87	$1.66	N/A

The Company calculates expected volatility for a stock-based grant based on historic daily stock price observations of its common stock during the period immediately preceding the grant that is equal in length to the expected term of the grant. The expected term of the options and forfeiture rates are estimated based on the Company’s exercise and employment termination experience. The risk free interest rate is based on U.S. Treasury yields for securities in effect at the time of grants with terms approximating the expected life of the grants. The assumptions used in the Black-Scholes option valuation model are highly subjective and can materially affect the resulting valuations.

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A summary of options granted, exercised, expired and forfeited under our plans and options outstanding as of, and changes made during, the six months ended June 30, 2012 (in thousands):

	Outstanding				Exercisable
	Number of Options		Weighted Average Exercise Price		Number of Options	Weighted Average Exercise Price
Options outstanding, January 1, 2012	750		$	2.90	570	$	3.12
Granted	1,110		3.20
Exercised	(5	)	1.70
Expired	(3	)	16.01
Forfeited	(22	)	1.95
Options outstanding, June 30, 2012	1,830		$	3.07	594	$	2.98

Stock option compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	6	$	38	$	3	$	19
Sales and marketing	4		10		3		4
General and administrative	80		16		62		8
	$	90	$	64	$	68	$	31

The remaining unrecognized stock-based compensation expense for options at June 30, 2012 was $2,748,000, of which $2,339,000, representing 1,000,000 options, will only be expensed upon a “change in control” and the remaining $409,000 will be amortized over a weighted average period of approximately 1.9 years.

The tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2012 was diminimus. There was no tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2011. No compensation costs were capitalized as part of the cost of an asset.

Note 4 - Restricted Stock    

A summary of restricted stock granted, vested, forfeited and unvested outstanding as of, and changes made during, the six months ended June 30, 2012, is presented below (in thousands):

	Restricted Shares		Weighted Average Grant Price
Unvested restricted shares outstanding, January 1, 2012	836		$	2.15
Granted	536		2.95
Vested	(100	)	2.11
Forfeited	(110	)	2.55
Unvested restricted shares outstanding, June 30, 2012	1,162		$	2.49

Restricted stock compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

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	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	16	$	18	$	10	$	8
Sales and marketing	30		9		16		7
General and administrative	83		56		46		24
	$	129	$	83	$	72	$	39

The remaining unrecognized stock-based compensation expense for restricted stock at June 30, 2012 was $2,639,000, of which $330,000, representing 130,000 shares, will only be expensed upon a “change in control” and the remaining $2,309,000 will be amortized over a weighted average period of 8.8 years .

The tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2012 was diminimus. There was no tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2011. No compensation costs were capitalized as part of the cost of an asset.

Note 5 – Warrants

There were no warrants granted, exercised, exchanged or forfeited during the six months ended June 30, 2012. There were 33,000 warrants outstanding as of June 30, 2012 with an exercise price of $1.60 and an expiration date of November 25, 2013.

Note 6 – Earnings Per Share

Earnings per share is calculated by dividing net income by the weighted average number of shares of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution from the conversion or exercise into common stock of securities such as stock options and warrants. For the six and three months ended June 30, 2012, diluted earnings per share included 140,000 and 106,000, respectively, shares of common stock associated with outstanding options and warrants, 133,000 shares issuable upon conversion of our convertible preferred stock calculated using the treasury stock method, and 1,163,000 shares of unvested restricted stock.

For the six and three months ended June 30, 2011, diluted earnings per share included 500,000 and 469,000, respectively, shares of common stock associated with outstanding options and warrants, 2,648,000 shares issuable upon conversion of our convertible preferred stock calculated using the treasury stock method, and 728,000 shares of unvested restricted stock.

Note 7 – Preferred Stock

Our Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock. As of June 30, 2012, there were: 100 shares of Series B-1 Preferred Stock authorized, issued and outstanding; 7,500 shares of Series A-2 Preferred Stock authorized and 53 shares issued and outstanding; and 4,000 shares of Series D Preferred Stock authorized and no shares issued or outstanding.

Each share of Series B-1 Preferred Stock has a stated value of $100,000 per share (the “Series B-1 Stated Value”), and a liquidation preference equal to the Series B-1 Stated Value plus all accrued and unpaid dividends (the “Series B-1 Liquidation Preference”). The Series B-1 Preferred Stock is not convertible into common stock. The Series B-1 Preferred Stock is senior to all other classes of equity and, commencing on January 1, 2013, is entitled to cumulative dividends from January 1, 2013, at a rate of 4% per annum, payable quarterly, based on the Series B-1 Stated Value. Commencing January 1, 2014, the cumulative dividend rate increases to 6% per annum, payable quarterly, based on the Series B-1 Stated Value. The Company may, at its option at any time, redeem all or a portion of the outstanding shares of Series B-1 Preferred Stock by paying the Series B-1 Liquidation Preference.

Each share of Series A-2 Preferred Stock has a stated value of $7,500 per share (the “A-2 Stated Value”), a liquidation preference equal to the Series A-2 Stated Value, and is convertible at the holder’s election into common stock at a conversion price per share of $3.00. Therefore, each share of Series A-2 Preferred Stock is convertible into 2,500 shares of common stock. The Series A-2 Preferred Stock is subordinate to the Series B-1 Preferred Stock

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but senior to all other classes of equity, has weighted average anti-dilution protection and, commencing on January 1, 2013, is entitled to cumulative dividends at a rate of 5% per annum, payable quarterly, based on the Series A-2 Stated Value. Once dividend payments commence, all dividends are payable at the option of the holder in cash or through the issuance of a number of additional shares of Series A-2 Preferred Stock with an aggregate liquidation preference equal to the dividend amount payable on the applicable dividend payment date.

In April 2012, a holder of the Company's Series A-2 Preferred Stock elected to convert 41 shares of Series A-2 Preferred Stock into 103,000 shares of common stock of the Company at the original conversion price. Each of the Series A-2 Preferred Stock shares was exchanged for 2,500 shares of common stock, pursuant to the terms of the Series A-2 Preferred Stock Certificate of Designation.

In accordance with ASC Topic 815, we evaluated whether our convertible preferred stock contains provisions that protect holders from declines in our stock price or otherwise couldresult in modification of the exercise price and/or shares to be issued under the respective preferred stock agreements based on a variable that is not an input to the fairvalue of a “fixed-for-fixed” option and require a derivative liability. The Company determined no derivative liability is required under ASC Topic 815 with respect to our convertible preferred stock. A contingent beneficial conversion amount is required to be calculated and recognized when and if the adjusted $3.00 conversion price of the convertible preferred stock is adjusted to reflect a down round stock issuance that reduces the conversion price below the $1.16 fair value of the common stock on the issuance date of the convertible preferred stock.

Note 8 - Commitments and Contingencies

Operating Leases

We lease several facilities under operating leases expiring through 2017. Certain leases require us to pay increases in real estate taxes, operating costs and repairs over certain base year amounts. Lease payments for the six and three months ended June 30, 2012 were $264,000 and $136,000, respectively. Lease payments for the six and three months ended June 30, 2011 were $247,000 and $123,000, respectively.

Future minimum rental commitments under all non-cancelable operating leases are as follows (in thousands):

Year Ending December 31,
2012 remaining	$	241
2013	496
2014	167
2015	140
2016	145
2017	87
	$	1,276

Capital Lease Obligation

In 2012, the Company entered into two non-cancelable lease agreements for $90,000 and $30,000 with interest rates of 9% and 3%, respectively. In 2011, the Company entered into two non-cancelable lease agreements for $512,000 and $40,000 with interest rates of 6% and 0%, respectively. These leases are accounted for as capital leases. Depreciation expense on the equipment under the capital leases for the six and three months ended June 30, 2012 was $59,000 and $30,000, respectively. There were no depreciation expenses on the equipment under the capital leases for the six and three months ended June 30, 2011. Future minimum commitments under all non-cancelable capital leases are as follows (in thousands):

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	Total		Interest		Principal
2012 remaining	126		14		112
2013	243		19		224
2014	194		6		188
2015	15		—		15
	$	578	$	39	$	539

Commercial Commitments

We have entered into a number of agreements with telecommunications companies to purchase communications services. Some of the agreements require a minimum amount of services to be purchased over the life of the agreement, or during a specified period of time.

Glowpoint believes that it will meet its commercial commitments. In certain instances where Glowpoint did not meet the minimum commitments, no penalties for minimum commitments have been assessed and the Company has entered into new agreements. It has been our experience that the prices and terms of successor agreements are similar to those offered by other carriers.

Glowpoint does not believe that any loss contingency related to a potential shortfall should be recorded in the condensed consolidated financial statements because it is not probable, from the information available and from prior experience, that Glowpoint has incurred a liability.

Letter of Credit

In November 2010, the Company entered into an irrevocable standby letter of credit (the “LOC”) for $115,000 to secure our security deposit for the sublease of our corporate headquarters. The LOC was obtained from Silicon Valley Bank (“SVB”) and will be renewed yearly until January 2014, the expiration date of our sublease.

Note 9 – Major Customers

Major customers are those customers / wholesale partners that account for more than 10% of revenues. For the six and three months ended June 30, 2012, approximately 37% and 36% of revenues, respectively, were derived from three major wholesale partners and the accounts receivable from these major partners represented approximately 49% of total accounts receivable as of June 30, 2012. For the six and three months ended June 30, 2011, approximately 26% and 22% of revenues, respectively, were derived from two major wholesale partners. The loss of any one of these partners would have a material adverse affect on the Company’s operations.

Note 10 – Revolving Loan Facility

On June 12, 2012, the Company entered into the Second Loan Modification Agreement (as amended, the “Revolving Loan Facility”) which amends its existing Loan and Security Agreement with SVB pursuant to which the Company may borrow up to $5,000,000 for working capital purposes. The Revolving Loan Facility matures June 2014. The amounts that can be borrowed at any given time are equal to the lesser of $5,000,000 or 80% of the eligible accounts receivable, as defined. As of June 30, 2012, we had unused borrowing availability of $2,662,000. Outstanding principal amounts under the Revolving Loan Facility were modified to bear interest at a floating Prime rate per annum equal to Prime Rate as announced by Wall Street Journal ("WSJ") plus one and a quarter percent (1.25%), payable monthly in arrears. The Company is no longer obligated to pay a minimum monthly interest but a fee equal to 0.35% of the unused borrowing amount each year. The WSJ Prime Rate was 3.25% as of June 30, 2012. The Revolving Loan Facility is secured by a first priority security interest in all the Company’s assets, including, without limitation, its intellectual property. The Revolving Loan Facility contains a number of financial covenants, including, but not limited to, covenants relating to minimum unrestricted cash balances and minimum monthly Adjusted EBITDA, as defined, in the Revolving Loan Facility. At June 30, 2012, we were in compliance with the covenants, as defined and set forth in the Revolving Loan Facility and there was $750,000 outstanding under the Revolving Loan Facility.

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The Revolving Loan Facility financing costs, net of accumulated amortization, which are included in other assets in the accompanying consolidated balance sheets, were $33,000 as of June 30, 2012. The financing costs for the Revolving Loan Facility are being amortized over the 12- to 24-month period through the maturity date of the Revolving Loan Facility. During the quarters ended June 30, 2012 and 2011, the amortization of financing costs was $14,000 and $16,000 was included as “Amortization of Deferred Financing Costs” in the consolidated statement of operations in Interest and Other Expense.

Note 11 – Discontinued Operations

As our ISDN resale services no longer fit into our overall strategic plan, in September 2010, we entered into an agreement with an independent telecommunications service provider to transfer these services and the related customers, and the Company receives a 15% monthly recurring referral fee for those revenues for as long as the customers maintain service. Such amounts were de minimis for the six and three months ended June 30, 2012 and were $12,000 for the six and three months ended June 30, 2011. The transfer of the customers was completed in the third quarter of 2011, and the Company will have no continuing involvement with the ISDN product line.

The Company accordingly classified these ISDN related revenues and expenses as discontinued operations in accordance with ASC 205.20 “Discontinued Operations.” The accompanying condensed consolidated financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. Prior year financial statements have been restated in conformity with generally accepted accounting principles to present the operations of the ISDN resale services as a discontinued operation.

Revenues from the ISDN resale services, reported as discontinued operations, for the six and three months ended June 30, 2011 were $81,000 and $30,000, respectively. Net income from the ISDN resale services, reported as discontinued operations for the six and three months ended June 30, 2011 were $18,000 and $24,000, respectively. The assets and liabilities from the ISDN resale services, reported as net current liabilities of discontinued operations, as of June 30, 2011 were $25,000. No income tax provision was required to be recognized by the Company against income from the ISDN resale services over the related periods.

Note 12 – Related Party Transactions

The Company provides cloud-managed video services (the “Video Services”) to a company in which one of our directors is an officer. Management believes that such transactions contain terms that would have been obtained from unaffiliated third parties. Related party Video Services revenue for the six months ended June 30, 2012 and 2011 were $125,000 and $161,000, respectively, and for the three months ended June 30, 2012 and 2011 were $59,000 and $81,000, respectively. The accounts receivable for this company was $31,000 as of June 30, 2012.

One of our directors currently provides general corporate strategy and management consulting services to the Company under a Consulting Agreement entered into as of September 1, 2010 (the “Consulting Agreement”). The Company pays this individual director $12,500 per month, plus any pre-authorized expenses incurred in providing services, under the Consulting Agreement. The term of the engagement is month-to-month.

In addition, the Company receives financial advisory services from a firm in which one of the principals is a shareholder of Glowpoint. Management believes that such transactions contain terms that would have been obtained from unaffiliated third parties. Related party financial advisory fees for the six months ended June 30, 2012 and 2011 were $72,000 and $72,000, respectively and for the three months ended June 30, 2012 and 2011 were $36,000 and $36,000, respectively. As of June 30, 2012, there was no accounts payable for this firm.

Note 13 – Asset Purchase Agreement

On June 30, 2011, the Company issued 769,000 shares of common stock as consideration for the purchase of assets pursuant to the terms of a purchase agreement. The assets acquired are equipment primarily used in the delivery and management of hosted video bridging and help desk and concierge services and are classified as property and equipment on the accompanying consolidated balance sheet. The total number of shares was based on consideration equal to $1,581,000 using the common stock’s 30-day trailing volume-weighted average price for the period ended June 28, 2011 of $2.05 (the “VWAP”). This transaction did not meet the requirements of a business

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combination and therefore was accounted for as an asset purchase with the fair value of the assets purchased equal to the consideration given. The equipment will be depreciated on a straight line basis over five years.

Pursuant to the agreement, if at any time between the first anniversary of the closing date and the date that is 18 months following the closing date (the “repurchase period”) the closing price of the Company’s common stock shall fall below the VWAP, then the seller has the right to demand that the Company repurchase from it, in a single transaction, not more than 50% of the shares delivered to such seller at closing at a price equal to the VWAP. This will result in a derivative liability and will be accounted for with changes in fair value during the repurchase period recorded in earnings. As of June 30, 2012, there was no derivative liability.

Note 14 – Subsequent Events

Management Changes

In July 2012, Michael S. Hubner, the Company’s General Counsel and Corporate Secretary, notified the Company that he was resigning effective August 2, 2012 in order to pursue other business opportunities outside of the video conferencing industry. His resignation was not the result of any disagreement relating to the Company’s business practices or legal matters. In accordance with the terms of the employment agreement entered into on March 12, 2012 by Mr. Hubner and the Company, Mr. Hubner is not entitled to receive any severance payments and all restricted stock and stock options previously granted to Mr. Hubner will be forfeited to the Company.

Affinity Acquisition

On August 12, 2012, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with Affinity VideoNet, Inc., a privately held Delaware corporation ("Affinity"), and GPAV Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company ("Merger Sub"). Pursuant to the Merger Agreement and subject to customary closing conditions, Merger Sub will merge with and into Affinity, and Affinity will become a wholly-owned subsidiary of the Company. The Merger is anticipated to close in the third quarter of 2012 and is expected to be funded with $7,750,000 cash sourced through debt financing, the issuance of $2,750,000 note, and the issuance of 2,650,000 shares of common stock.

The consummation of the Merger is subject to various conditions, including, but not limited to, (i) the accuracy of the representations and warranties with respect to certain matters, and (ii) the consummation of certain debt financing relating to the transaction. The Merger Agreement also contains customary representations, warranties and indemnification provisions.

The Merger will be treated by the Company under the acquisition method of accounting, as prescribed in Accounting Standards Codification 805, “Business Combinations,” for business combinations under GAAP. The Company will be deemed to have acquired the assets and liabilities of Affinity and the results of operations will be consolidated into the results of operations of the Company as of the completion of the Merger. Financial statements in quarterly and annual filings of the new Company issued after the Merger will reflect only the operations of the Company's business after the Merger and will not be restated retroactively to reflect the historical financial position or results of operations of the Company.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Certain statements in this Quarterly Report on Form 10-Q (the “Report”) are “forward-looking statements.” These forward-looking statements include, but are not limited to, statements about the plans, objectives, expectations and intentions of Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”), a Delaware corporation, and other statements contained in this Report that are not historical facts. Forward-looking statements in this Report or hereafter included in other publicly available documents filed with the Securities and Exchange Commission (the “Commission”) reports to our stockholders and other publicly available statements issued or released by us involve known and unknown risks, uncertainties and other factors that could cause our actual results, performance (financial or operating) or achievements to differ from the future results, performance (financial or operating) or achievements expressed or implied by such forward-looking statements. Such future results are based upon management's best estimates based upon current conditions and the most recent results of operations. When used in this Report, the words “expect,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate” and similar

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expressions are generally intended to identify forward-looking statements, because these forward-looking statements involve risks and uncertainties. There are important factors that could cause actual results to differ materially from those expressed or implied by these forward-looking statements, including our plans, objectives, expectations and intentions and other factors that are discussedunder the section entitled “Risk Factors,” as well as our consolidated financial statements and the footnotes thereto, for the fiscal year ended December 31, 2011 as filed with the Commission with our Annual Report on Form 10-K filed on March 8, 2012.

The following discussion and analysis should be read in conjunction with the condensed consolidated financial statements and related notes included elsewhere in this Report.

Overview

Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”) is a provider of cloud managed video services. Our services, delivered via our cloud-based OpenVideo™ platform (as discussed in further detail below), are securely accessible via any network (private or public) and are technology-agnostic. The Company delivers services to more than 500 different enterprises in over 35 countries supporting thousands of video endpoints, immersive telepresence rooms, and infrastructure for business-quality, real-time, two-way visual communications. Glowpoint's managed services solve the challenges associated with achieving consistent high-quality video experiences and controlling the total cost of ownership related to technology and support, while increasing the return on investment (ROI) of its end users' video equipment by providing seamless access to video equipment outside of their immediate enterprise network.

Glowpoint's solutions are hardware-agnostic, meaning the video equipment may be manufactured by Cisco, Polycom, Logitech, Sony or others and network-neutral, in that connectivity may be via native Internet or network provided by AT&T, Verizon, TATA Communications, British Telecom or others, supporting all recognized video standards across any IP network.

With its carrier-grade, multi-tenant OpenVideo™ platform built in-house, Glowpoint provides a range of remote monitoring and management services that increase the utilization of the video deployment by ensuring all systems are on, all the time, and calls start on time with the highest possible quality.

Glowpoint's core value proposition for customers includes the enablement of integration of their video deployment into the unified communications environment, allowing wide adoption and usage of video communications, increasing ROI and lowering the total cost of ownership. With its multi-tenant infrastructure in the cloud, Glowpoint provides an alternative to capital-intensive, premise-based infrastructure, which customers traditionally have had to purchase for the video environment to function, as well as the tools and services to enable wide adoption of video communications throughout their business. Glowpoint is a leader in managed video and global video exchange services that provide businesses and service providers a way to link together their “islands of video” across third party private networks and enable organizations to drive adoption.

The Company has been recognized in the industry for focusing on providing an innovative customer experience through our use of IP-based video functionality and innovation. Industry awards and recognition over the last few years include: Excellence in Globalization Award (Frost and Sullivan); Top Ten Managed Service Provider (MSP mentor); Best US Managed Conferencing Services Provider (Telepresence and Videoconferencing Insight Newsletter); PACE Award for contributions to the advancement of video communications (Telespan); and Growth Company of the Year, Finalist (New Jersey Technology Council).  We are also widely followed and discussed in market research by the leading industry and research analyst firms, including Gartner, Forrester, Frost and Sullivan, and Wainhouse Research.

Glowpoint, a Delaware corporation, was formed in May 2000. The Company operates in one segment and therefore segment information is not presented

Glowpoint Services and Features

Today's telepresence and video conferencing environments have become a key part of a complete unified business communications strategy. For organizations that are already using video, and for those exploring its benefits for the first time, OpenVideo™ is a unique platform that can help them achieve a successful video collaboration program.

Traditionally, video has presented challenges by presenting a complex maze of systems and networks that must be navigated through and closely managed - and although most of the business-quality video systems today are

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“standards-based,” there are inherent interoperability problems between different vendors' video equipment, resulting in communication islands. Glowpoint's suite of cloud managed video services can be accessed and utilized by customers regardless of the technology and network they are using. Customers who purchase a Cisco, Polycom, LifeSize (Logitech) or use any other third-party video communications software, may all take advantage of the Glowpoint OpenVideo™ cloud regardless of their choice of network. Glowpoint's core services are offered as part of OpenVideo™ to generate monthly recurring revenue for the Company.

OpenVideo™ is a cloud platform that offers telepresence, video and unified communications and collaboration users a way to meet and communicate across the varying hardware/software platforms and carrier networks in a secure and seamless fashion. OpenVideo™ combines years of best practices, experience and technology development into video collaboration platform that provides instant connectivity, self-serve and managed help desk resources, and the ease of use that makes video collaboration seamless and effortless. Beyond the technology and applications, OpenVideo™ is built around security protocols to ensure that enterprises and organizations of any size can communicate to any other desired video users in a secure, high-quality and reliable fashion.

Glowpoint's services are categorized as follows:

Monitoring & Management Services and Collaboration Services (“Managed Services Combined”)

We provide end-to-end cloud managed services for telepresence, conference room, desktop, mobile solutions, and video infrastructure. We have a team of video experts utilizing the latest in remote management technologies. These engineering and operational customer support resources operate out of our three Video Network Operations Centers (VNOCs) located in the United States, in California, Pennsylvania, and New Jersey. These VNOC facilities provide global 24/7 support to our network and managed service customers, including our wholesale branded partners customers.  The primary functions of these operational resources located in these centers are customer service, conference production, network operation monitoring and remediation, and help desk technical support.

The company also maintains Points-of Presence (POP's) that houses the technology and infrastructure along with the servers and database warehousing for the OpenVideo platform and support systems of the business. There are currently three Points-of-Presence (POPs) located in the United States (New Jersey and Chicago) and United Kingdom (London), with additional POPs planned as needed. These carrier-neutral data centers are co-location facilities where network equipment that serves our video infrastructure is housed and acts as shared or dedicated infrastructure for our business customers. The POPs provide power redundancy & UPS (uninterrupted Power Supply) systems, which are constantly monitored and maintained. They also have physical security, flood controls, fire detection and suppression systems and are structurally designed for earthquakes.

We offer a complete portfolio of remote monitoring & management services that can help make video more widely available, improve up-time, drive higher usage, off-load IT teams, or all of the above. Our service packages can be customized to suit the needs of the business, whether for a large enterprise, small or medium sized business.

Glowpoint provides wholesale programs and private-labeled resale options for hardware manufacturers, network operators and systems integrators seeking to offer video services as a value-added addition to their collaboration and communications offerings. All of Glowpoint's unique features and services have been designed so that the entire suite can be private labeled by other service providers or companies who want to integrate video communications into their existing products quickly and cost effectively. Glowpoint will provide all of the video infrastructure and support, including customer portals and billing applications, as a private label service for a third party. This means that our services are branded with the other company's name, logo and other information, our live operators answer calls using the other company's name, and the other company's end user customers view the service as provided by that other company even though it is actually “powered by Glowpoint.” Glowpoint has been involved in a number of private label opportunities and currently provides branding of its services to six strategic global partners whom serve 147 customers with these services and support from Glowpoint through their unique brands. These services account for approximately 37% of Glowpoint's total revenue for the six months ended June 30, 2012. Many strategic global companies in the unified communications industry have recognized Glowpoint's value to their own sales and marketing efforts. These strategic partnerships are core to the company's global sales strategy.

Glowpoint's collaboration services, hosted via the OpenVideo™ cloud, are designed to connect video users all over the world whether they are on immersive telepresence, conference room, desktop or mobile devices. Customers that are registered to the OpenVideo™ cloud can connect to any other customer in the OpenVideo™ cloud and get access to Glowpoint's full suite of cloud managed video services, including the Virtual Video Room, video bridging, and webcasting services. Through our extensive partnerships, OpenVideo™ customers can also have business-to-business connectivity across other service providers platforms.

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Network Services

In order to provide customers with access to the OpenVideo™ cloud, Glowpoint maintains a dedicated video overlay network. We have partnered with Tier 1 MPLS providers, including Global Crossing, Masergy, XO, Qwest, TATA, PCCW and Verizon Business, to provide a global access footprint with flexible options to consume our suite of OpenVideo™ services. Our OpenVideo™ cloud is also connected to the Equnix Ethernet Carrier Exchange to provide native Layer 2 Ethernet services to enterprise customers.

Glowpoint leverages the last mile and network connectivity of carriers and provides an option for businesses to purchase a full overlay network for their video only needs. The network bandwidth that we provide for these dedicated overlay networks ranges from 1.5Mbps to 1Gbps. As a result of this, our network services business carries variable costs associated with the purchasing and reselling of this connectivity.

With our network services, we provide customers with the flexibility to either source the entire network from a single provider, maintain existing network and extend a logical connection to the OpenVideo™ cloud or bring bandwidth to OpenVideo™ datacenters. Although a declining component of our revenue stream, we believe that network services will continue to be an integral part of our revenue mix in the future, driven by new connectivity needs to connect and peer with Glowpoint's OpenVideo™ cloud. However, Glowpoint does not consider this a core driver or measurement of its market share in the cloud managed video service industry.

Professional and other services

With the growing interest in convergence and the desire by some enterprises to add the transport of video to their enterprise networks, we have provided professional services and believe the market for such services is growing. Additionally, our extensive knowledge of all leading video conferencing vendors' equipment makes our video engineers a valuable resource for manufacturers, partners and end users on an outsourced basis. While our primary focus is generating monthly recurring revenue from our subscription services, our professional services have been a valuable lead for video communication opportunities leading to sales of our managed video services. Glowpoint provides professional services to its partners and customers for custom solutions but does not consider this a core driver or measurement of its market share in the cloud managed video service industry.

We have bundled certain components of our managed services to offer video communication solutions for broadcast/media content acquisition and event services. Customers have used our managed video services during events to cost-effectively acquire video content for broadcasters, cable companies and other media enterprises, especially in the sports, news and entertainment industries. While it includes our core managed video services, IP-based broadcasting and event services require more project management and dedicated operational and engineering personnel than our standard subscription services. Rather than using an expensive satellite feed, companies can acquire broadcast-quality standard or high definition footage at a fraction of the cost from Glowpoint over a dedicated IP connection. Since 2002, we have provided this service to ESPN during the professional football and basketball drafts. ESPN has used our service for interviews from team locations with coaches, players and analysts during their coverage. In 2007, we launched a High Definition (HD) content acquisition solution that we branded TeamCamHD and RemoteCamHD. This offering provides two-way HD video communication for content acquisition from remote locations. Glowpoint now provides a full suite of HD solutions for the broadcast, entertainment and media industry and is considered a high-quality alternative to the traditional means of acquiring content in many applications, including interviews and even full motion video.

Critical Accounting Policies and Estimates

There have been no changes to our critical accounting policies in the three months ended June 30, 2012. Critical accounting policies and the significant estimates made in accordance with them are regularly discussed with our audit committee. Those policies are discussed under “Critical Accounting Policies” in our “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Item 7, as well as in our consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2011, as filed with the Commission with our Annual Report on Form 10-K filed on March 8, 2012.

Results of Operations

Six and Three Months Ended June 30, 2012 (“2012 Period” and the "2012 Quarter," respectively) compared to Six and Three Months Ended June 30, 2011 (“2011 Period” and the "2011 Quarter," respectively)

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Revenue. Total revenue decreased $389,000, or 2.8%, in the 2012 Period to $13,546,000 from $13,935,000 in the 2011 Period. Total revenue decreased $154,000 or 2.2% in the 2012 Quarter to $6,800,000 from $6,954,000 in the 2011 Quarter. The following are the changes in the components of our revenue:

• Revenue for Managed Services Combined, which represents subscription (monitoring and management) services generally tied to contracts of 12 months or more and usage based collaboration services, increased 5.2% to $6,501,000 and 5.2% to $3,204,000 in the 2012 Period and 2012 Quarter, respectively. Revenue for Managed Services Combined accounted for 48.0% of our total revenue in the 2012 Period compared to 44.3% for the 2011 Period. The increase in revenue for Managed Services Combined was primarily attributable to new customer acquisitions.

• Revenue for network services, which represents network sales and related services generally tied to contracts of 12 months or more, decreased 10.3% to $6,170,000 and 10.0% to $3,030,000 in the 2012 Period and 2012 Quarter, respectively. Revenue for network services accounted for 45.5% of total revenue in the 2012 Period compared to 49.4% for the 2011 Period. The decrease in revenue for network services was primarily attributable to customers' disconnecting or reducing their portfolio of Glowpoint services. The trends in the economy, the commoditization of IP networking, along with the availability of converged networking services such that end users can purchase one network and use for all their unified communications applications to include video, have all contributed to the decline in these revenues for Glowpoint. We believe our network service revenue will continue to decline in the current year, although at a slower pace than the previous year.

• Revenue for professional and other services, which represent non-recurring services, decreased 0.1% to $875,000 and increased 4.4% to $566,000 in the 2012 Period and 2012 Quarter, respectively. Revenue for professional and other services accounted for 6.5% of revenue in the 2012 Period compared to 6.3% for the 2011 Period. The increase in revenue for professional and other services in the 2012 Quarter was primarily attributable to special projects we performed for one of our wholesale partners.

	Six Months Ended June 30, (in thousands)									Three Months Ended June 30, (in thousands)
	2012		2011		Increase (Decrease)			% Change		2012		2011		Increase (Decrease)			% Change
Revenue
Managed Services Combined	$	6,501	$	6,180	$	321		5.2	%	$	3,204	$	3,046	$	158		5.2	%
Network services	6,170		6,879		(709		)	(10.3	)	3,030		3,366		(336		)	(10.0	)
Professional and other services	875		876		(1		)	(0.1	)	566		542		24			4.4
Total revenue	$	13,546	$	13,935	$	(389	)	(2.8	)%	$	6,800	$	6,954	$	(154	)	(2.2	)%

Network and Infrastructure Expenses. Network and infrastructure expenses decreased 13.6% to $4,221,000 in the 2012 Period and 13.2% to $2,145,000 in the 2012 Quarter. Network and infrastructure expenses include all external costs, exclusive of depreciation and amortization, related to the Glowpoint network and hosting facilities for our cloud-based infrastructure. This operating expense category also includes the cost for taxes which have been billed to customers. The decrease was primarily attributed to customers' disconnecting or reducing their portfolio of Glowpoint services and the achievement of cost efficiencies exclusive of the lost customers.

Global Managed Services Expenses. Global managed services expenses decreased 10.6% to $3,461,000 in the 2012 Period and 10.8% to $1,765,000 in the 2012 Quarter. Global managed services expenses include all costs for delivering and servicing our managed services, such as delivering customer service operations, internal costs of maintaining the network and infrastructure, and the development and implementation of operating support systems and associated hardware enhancements. The decrease was primarily attributed to automation and efficiencies in use of capacity of platform.

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Sales and Marketing Expenses. Sales and marketing expenses increased 2.2% to $1,864,000 in the 2012 Period and decreased 2.7% to $878,000 in the 2012 Quarter. The increase in the 2012 Period was primarily attributed to investments in expanding the sales force. The decrease in the 2012 Quarter was primarily due to fewer trade shows and sponsorships.

General and Administrative Expenses. General and administrative expenses, which include direct corporate expenses related to costs of personnel in the various corporate support categories, including executive, finance, human resources and information technology, decreased 1.3% to $2,652,000 in the 2012 Period and increased 1.6% to $1,302,000 in the 2012 Quarter. The decrease in the 2012 Period was primarily due to expenses related to the relocation of our new headquarters during the first and second quarters of 2011 as well as a reduction in expenses due to efficiencies. The increase in the 2012 Quarter was primarily due to consulting related expenses.

Depreciation and Amortization Expenses. Depreciation and amortization expenses increased 51.0% to $865,000 in the 2012 Period and 43.1% to $425,000 in the 2012 Quarter, due to purchases of property and equipment (as discussed in Note 13 to our consolidated financial statements attached hereto) exceeding the retirement of these assets.

Income from Operations. Income from operations increased by $389,000 in the 2012 Period to $483,000 and $262,000 in the 2012 Quarter to $285,000. The primary drivers of the increase were due to a shift in revenue to higher margin managed service revenues and efficiencies.

Interest and Other Expense. Interest and other expense in the 2012 Period was $58,000, which principally reflected $29,000 of interest charges from vendors and $29,000 of the amortization of financing charges related to our Revolving Loan Facility. Interest and other expense in the 2011 Period was $63,000, which principally reflected $32,000 of interest charges from vendors and $31,000 of the amortization of financing charges related to our Revolving Loan Facility. 

Interest and other expense in the 2012 Quarter was $32,000, which principally reflected $18,000 of interest charges from vendors and $14,000 of the amortization of financing charges related to our Revolving Loan Facility. Interest and other expenses in the 2011 Quarter was $30,000, which principally reflected $14,000 of interest charges from vendors and $16,000 of the amortization of financing charges related to our Revolving Loan Facility.

Income Taxes. As a result of our current income, we recorded a $5,000 provision for incomes taxes for certain minimum taxes in the 2012 Period and 2012 Quarter. There was no provision recorded in the 2011 Period and 2011 Quarter. Any deferred tax asset that would be related to our losses has been fully reserved under a valuation allowance, reflecting the uncertainties as to realization evidenced by our historical results and restrictions on the usage of the net operating loss carry forwards.

Income from Continuing Operations. Income from continuing operations increased by $394,000 to $425,000 in the 2012 Period, and by $260,000 to $253,000 in the 2012 Quarter. This increase was due to reduced operating expenses noted above.

Income from Discontinued Operations. Income from discontinued operations decreased by $18,000 to $0 in the 2012 Period and $24,000 to $0 in the 2012 Quarter. This decrease was a result of the transfer of our ISDN resale business completed in the third quarter of 2011.

Net Income. Net Income increased by $371,000 to $420,000, or $0.02 per basic and diluted share, in the 2012 Period. Net Income increased by $231,000 to $248,000, or $0.01 per basic and diluted share, in the 2012 Quarter. The increases in income have been driven by a number of factors. Primarily, the shift in revenue make up to higher margin managed service revenues, which is represented by the decline in network service and increase in managed services. In addition, as the network service is eliminated, there is a cost that is also eliminated which is directly related to the last mile connection and associated cost that Glowpoint incurs for delivering network service. Finally, the company has and will continue to invest in automation and development of operational tools, which permits the business to grow its managed services without taking on additional costs. This efficiency has permitted the company to also make certain cost cuts in previous periods as well as add revenues without add costs.

Liquidity and Capital Resources

-19-

For the six months ended June 30, 2012, we had net income of $420,000 and a positive cash flow from operations of $297,000. As of June 30, 2012, we had $1,689,000 of cash, positive working capital of $1,513,000 and an accumulated deficit of $164,279,000. In June 2012, the Company renewed its Revolving Loan Facility (as discussed in Note 10 to our consolidated financial statements attached hereto) pursuant to which the Company may borrow up to $5,000,000 for working capital purposes and under which we had unused borrowing availability of approximately $2,662,000 as of June 30, 2012. The Revolving Loan Facility matures in June 2014. Pursuant to the terms of our Series A-2 Preferred Stock and Series B-1 Preferred Stock, the Company will be obligated to pay dividends commencing on January 1, 2013.

In August 2012, the Company entered into a definitive agreement to acquire privately held Affinity VideoNet (as discussed in Note 14 to our consolidated financial statements attached hereto) which will be funded with $7,750,000 cash sourced through debt financing, the issuance of $2,750,000 note, and the issuance of 2,650,000 shares of common stock. The Company has been in negotiations with various lenders and the Merger is anticipated to close in the third quarter of 2012 subject to various conditions, including, but not limited to, (i) the accuracy of the representations and warranties with respect to certain matters, and (ii) the consummation of certain debt financing relating to the transaction.

Based primarily on our efforts to manage costs and our Revolving Loan Facility, along with our cash flow projection and expected debt financing arrangement, the Company believes that it has, and will have, sufficient cash flow to fund its operations through at least August 31, 2013. We have historically been able to raise capital in private placements as needed to fund operations and provide growth capital. There can be no assurances, however, that we will be able to raise additional capital as may be needed or upon acceptable terms, or that current economic conditions will not negatively impact us. If the current economic conditions negatively impact us and we are unable to raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company.

Off-Balance Sheet Arrangements

As of June 30, 2012, we had no off-balance sheet arrangements.

Adjusted EBITDA

Adjusted EBITDA is defined as income from continuing operations before depreciation, amortization, interest expense, interest income, taxes, severance and stock-based compensation. Adjusted EBITDA is not intended to replace operating income (loss), net income (loss), cash flow or other measures of financial performance reported in accordance with generally accepted accounting principles. Rather, Adjusted EBITDA is an important measure used by management to assess the operating performance of the Company. Adjusted EBITDA as defined here may not be comparable to similarly titled measures reported by other companies due to differences in accounting policies. A reconciliation of Adjusted EBITDA to net income from continuing operations is shown below:

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Income (loss) from continuing operations	$	425	$	31	$	253	$	(7	)
Depreciation and amortization	865		573		425		297
Amortization of financing costs	29		31		14		16
Interest expense	29		32		18		14
EBITDA	1,348		667		710		320
Stock-based compensation	219		147		140		70
Severance	—		11		—		11
Adjusted EBITDA	$	1,567	$	825	$	850	$	401

Inflation

Management does not believe inflation had a significant effect on the condensed consolidated financial statements for the periods presented.

-20-

Item 3. Quantitative and Qualitative Disclosures about Market Risk

Not Applicable.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed by Glowpoint in the reports it files or submits under the Securities Exchange Act of 1934, as amended (the "Exchange Act") is recorded, processed, summarized, and reported within the time periods specified by the Commission’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to provide reasonable assurance that information required to be disclosed by Glowpoint in the reports it files or submits under the Exchange Act is accumulated and communicated to management, including the Chief Executive Officer and Interim Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Under the supervision and with the participation of management, including the Chief Executive Officer and Interim Chief Financial Officer, Glowpoint has evaluated the effectiveness of its disclosure controls and procedures (as such term is defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of June 30, 2012, and, based upon this evaluation, the Chief Executive Officer and Interim Chief Financial Officer have concluded that these controls and procedures are effective in providing reasonable assurance of compliance.

Changes in Internal Control over Financial Reporting

No change in our internal control over financial reporting occurred during the three months ended June 30, 2012 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1.    Legal Proceedings

None.

Item 1A. Risk Factors

A description of the risks associated with our business, financial conditions and results of operations is set forth in Item 1A of our Annual Report on Form 10-K for the fiscal year ended December 31, 2011 and filed with the Commission on March 8, 2012. There have been no material changes to these risks during the three months ended June 30, 2012.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds

On April 4, 2012, the Company issued 102,657 shares of common stock upon the conversion of 41 outstanding shares of Series A-2 Preferred Stock, at the original conversion price. The Company did not receive any proceeds upon the conversion of the Series A-2 Preferred Stock. Issuance of the shares of common stock was exempt from registration pursuant to the to the provisions of Section 3(a)(9) of the Securities Act of 1933. 

In addition, the Company issued 25,000 shares of unregistered common stock to Monarch Capital Group, LLC ("MCG") in consideration of services rendered under the Consulting Agreement dated as of May 22, 2012 between the Company and MCG. The shares of common stock were issued in reliance on the exemption from registration set forth in Section 4(2) of the Securities Act of 1933. Other than the foregoing, there have been no unregistered sales of securities during the period covered by this Report that have not been previously reported in a Quarterly Report on Form 10-Q or in a Current Report on Form 8-K.

Item 3.    Defaults upon Senior Securities

None.

-21-

Item 4.    Mine Safety Disclosures

Not Applicable.

Item 5.    Other Information

None.

-22-

Item 6.    Exhibits

10.1	Second Loan Modification Agreement dated as of June 12, 2012 between Glowpoint, Inc. and Silicon Valley Bank (filed as an exhibit to Registrant's Current Report on Form 8-K filed with the Securities and Exchange Commission on June 14, 2012, and incorporated herein by reference)
31.1*	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer
31.2*	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer
32.1*	Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS**	XBRL Instance Document
101.SCH**	XBRL Taxonomy Extension Schema
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase
101.DEF**	XBRL Taxonomy Extension Definition Linkbase
101.LAB**	XBRL Taxonomy Extension Label Linkbase
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase

* Filed herewith.

** Pursuant to Rule 406T of Regulation S-T, these interactive data files are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933 or Section 18 of the Securities Exchange Act of 1934 and otherwise are not subject to liability.

-23-

SIGNATURES

In accordance with the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	GLOWPOINT, INC.
Date: August 14, 2012	By:    /s/ Joseph Laezza
	Joseph Laezza, Chief Executive Officer (principal executive officer)
Date: August 14, 2012	By:    /s/ Tolga Sakman
	Tolga Sakman, Interim Chief Financial Officer (principal financial and accounting officer)

-24-

EX-31.1

Exhibit 31.1

CERTIFICATION OF CHIEF EXECUTIVE OFFICER

I, Joseph Laezza, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Glowpoint, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;  and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 14, 2012

/s/ Joseph Laezza    

Joseph Laezza

Chief Executive Officer

(principal executive officer)

EX-31.2

Exhibit 31.2

CERTIFICATION OF CHIEF FINANCIAL OFFICER

I, Tolga Sakman, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Glowpoint, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;  and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: August 14, 2012

/s/ Tolga Sakman    

Tolga Sakman

Interim Chief Financial Officer

(principal financial and accounting officer)

EX-32.1

Exhibit 32.1

SECTION 906 CERTIFICATION

The undersigned officers of Glowpoint, Inc., a Delaware corporation (the "Company"), do hereby certify, in accordance with 18 U.S.C. Section 1350, as created pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1)The accompanying Quarterly Report on Form 10-Q of the Company for the quarter ended June 30, 2012 (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 14, 2012

/s/ Joseph Laezza    

Joseph Laezza

Chief Executive Officer

/s/ Tolga Sakman    

Tolga Sakman

Interim Chief Financial Officer

XML

Major Customers Narrative (Details)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012 Major_Wholesale_Partners	Jun. 30, 2011 Major_Wholesale_Partners
Concentration Risks, Types, Major Customers [Abstract]
Major wholesale customer			3	2
revenues share from major wholesale partners	36.00%	22.00%	37.00%	26.00%
accounts receivable from major wholesale partners			49.00%

XML

Warrants Narrative (Details) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2012
Warrants and Rights Note Disclosure [Abstract]
Warrants granted, exercised, exchanged or forfeited during the period	0
Warrants Outstanding	$ 33
Exercise price for outstanding warrants	$ 1.60

XML

Basis of Presentation Narrative (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012 Countries	Jun. 30, 2011	Jun. 30, 2012 Points-of-Presence Video_Network_Operations_Centers Enterprises Countries	Jun. 30, 2011	Dec. 31, 2011	Dec. 31, 2010
Cash and Cash Equivalents [Line Items]
Net income	$ 248,000	$ 17,000	$ 420,000	$ 49,000
Cash flow from operations			297,000	(223,000)
Cash	1,689,000	1,258,000	1,689,000	1,258,000	1,818,000	2,035,000
Positive Working Capital	1,513,000		1,513,000
Accumulated Deficit	(164,279,000)		(164,279,000)		(164,699,000)
Revolving Loan Facility Limit	5,000,000		5,000,000
Countries	35		35
Number of VNOCs [Text Block]			3
Number of PoPs [Text Block]			3
Private Label Customers [Text Block]			147
Private Label Customers % of Revenue [Text Block]			37.00%
More than 500 different enterprises			500
Revolving Credit Facility [Member]
Cash and Cash Equivalents [Line Items]
Revolving Loan Facility Limit	5,000,000		5,000,000
Unused Revolving Loan Facility	$ 2,662,000		$ 2,662,000

XML

Related Party Transactions Related Party Transactions Narrative (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Related Party Transactions [Abstract]
Revenue from Related Parties	$ 59,000	$ 81,000	$ 125,000	$ 161,000
Accounts Receivable, Related Parties, Current	31,000		31,000
Consultancy Charge paid to director			12,500
Related party financial advisory fees	$ 36,000	$ 36,000	$ 72,000	$ 72,000

XML

Commitments and Contingencies Table Operating Lease (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Commitments and Contingencies Disclosure [Abstract]
2012 remaining	$ 241
2013	496
2014	167
2015	140
2016	145
2017	87
Total	$ 1,276

XML

Stock Options

6 Months Ended

Jun. 30, 2012

Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]

Stock Options

Stock Options

We periodically grant stock options to employees and directors in accordance with the provisions of our stock option plans, with the exercise price of the stock options being set at or above the closing market price of the common stock on the date of grant. The intrinsic value of options outstanding and exercisable at June 30, 2012 and 2011 was $143,000 and $108,000, respectively. Options exercised during the six and three months ended June 30, 2012 were 5,000 and 0, respectively. Options exercised during the six and three months ended June 30, 2011 were 124,000 and 64,000, respectively.

The weighted average fair value of each option granted is estimated on the date of grant using the Black-Scholes option valuation model with the following weighted average assumptions during the six and three months ended June 30, 2012 and 2011:

	Six Months Ended June 30,		Three Months Ended June 30,
	2012	2011	2012	2011
Risk free interest rate	0.9%	2.1%	0.7%	N/A
Expected option lives	5 Years	5 Years	5 Years	N/A
Expected volatility	111.2%	117.4%	109.7%	N/A
Estimated forfeiture rate	10%	10%	10%	N/A
Expected dividend yields	—	—	—	—
Weighted average grant date fair value of options	$2.37	$1.87	$1.66	N/A

The Company calculates expected volatility for a stock-based grant based on historic daily stock price observations of its common stock during the period immediately preceding the grant that is equal in length to the expected term of the grant. The expected term of the options and forfeiture rates are estimated based on the Company’s exercise and employment termination experience. The risk free interest rate is based on U.S. Treasury yields for securities in effect at the time of grants with terms approximating the expected life of the grants. The assumptions used in the Black-Scholes option valuation model are highly subjective and can materially affect the resulting valuations.

A summary of options granted, exercised, expired and forfeited under our plans and options outstanding as of, and changes made during, the six months ended June 30, 2012 (in thousands):

	Outstanding				Exercisable
	Number of Options		Weighted Average Exercise Price		Number of Options	Weighted Average Exercise Price
Options outstanding, January 1, 2012	750		$	2.90	570	$	3.12
Granted	1,110		3.20
Exercised	(5	)	1.70
Expired	(3	)	16.01
Forfeited	(22	)	1.95
Options outstanding, June 30, 2012	1,830		$	3.07	594	$	2.98

Stock option compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	6	$	38	$	3	$	19
Sales and marketing	4		10		3		4
General and administrative	80		16		62		8
	$	90	$	64	$	68	$	31

The remaining unrecognized stock-based compensation expense for options at June 30, 2012 was $2,748,000, of which $2,339,000, representing 1,000,000 options, will only be expensed upon a “change in control” and the remaining $409,000 will be amortized over a weighted average period of approximately 1.9 years.

The tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2012 was diminimus. There was no tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2011. No compensation costs were capitalized as part of the cost of an asset.

XML

Asset Purchase Agreement Narrative (Details) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	6 Months Ended
	Jun. 28, 2011	Jun. 30, 2012	Jun. 30, 2011 M D
Asset Purchase Agreement [Line Items]
Share issued for purchase of assets			769,000
Consideration for share issued		$ 0	$ 1,581
Trading Volume-Weighted Average Price			30
Common Stock, 30-day Trailing Volume-Weighted Average Price	$ 2.05
useful life of equipment		5 years
Repurchase Period, Asset Purchase Agreement			18
Maximum [Member]
Asset Purchase Agreement [Line Items]
Asset Purchase Agreement, Repurchase Rights, Percentage			50.00%

XML

Stock Options Table Options Outstanding (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Outstanding Number of Options, Beginning			750
Outstanding Weighted Average Exercise Price, Beginning			$ 2.90
Exercisable Number of Options, Beginning			570
Exercisable Weighted Average Exercise Price, Beginning			$ 3.12
Outstanding Number of Options, Granted			1,110
Outstanding Weighted Average Exercise Price, Granted			$ 3.20
Outstanding Number of Options, Exercised	0	64	(5)	124
Outstanding Weighted Average Exercise Price, Exercised			$ 1.70
Outstanding Number of Options, Expired			(3)
Outstanding Weighted Average Exercise Price, Expired			$ 16.01
Outstanding Number of Options, Forfeited			(22)
Outstanding Weighted Average Exercise Price, Forfeited			$ 1.95
Outstanding Number of Options, Ending	1,830		1,830
Outstanding Weighted Average Exercise Price, Ending	$ 3.07		$ 3.07
Exercisable Number of Options, Ending	594		594
Exercisable Weighted Average Exercise Price, Ending	$ 2.98		$ 2.98

XML

Stock Options Table FV of Options (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Risk free interest rate	0.70%		0.90%	2.10%
Expected option lives	5 years		5 years	5 years
Expected volatility	109.70%		111.20%	117.40%
Estimated forfeiture rate	10.00%		10.00%	10.00%
Expected dividend yields	0.00%	0.00%	0.00%	0.00%
Weighted average grant date fair value of options	$ 1.66		$ 2.37	$ 1.87

XML

Subsequent Events - Affinity Acquisition (Details) (Business Acquisition [Member], Affinity VideoNet, Inc. [Member], USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Business Acquisition [Member] | Affinity VideoNet, Inc. [Member]
Subsequent Event [Line Items]
Cash and Cash Equivalents, at Carrying Value	$ 7,750
Notes Payable	$ 2,750
Common Stock, Shares, Issued	2,650

XML

Stock Options Table Expense Allocation (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Global managed services	$ 1,765	$ 1,979	$ 3,461	$ 3,873
Sales and marketing	878	902	1,864	1,824
General and administrative	1,302	1,282	2,652	2,688
Stock Option Expense [Member]
Global managed services	3	19	6	38
Sales and marketing	3	4	4	10
General and administrative	62	8	80	16
Stock option compensation expense	$ 68	$ 31	$ 90	$ 64

XML

Restricted Stock Narrative (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
unrecognized stock-based compensation expense for restricted stock	$ 2,639		$ 2,639
unrecognized stock-based compensation expensed restricted stock upon change in control	330		330
unrecognized stock-based compensation expensed restricted stock others	2,309		2,309
unrecognized stock-based compensation restricted stock depending upon change in control	130		130
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Global managed services	10	8	16	18
Sales and marketing	16	7	30	9
General and administrative	46	24	83	56
Restricted stock compensation expense	$ 72	$ 39	$ 129	$ 83
weighted average period for amortization of restricted stock			8 years 9 months 18 days

XML

Summary of Significant Accounting Policies Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2012

Summary of Significant Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Glowpoint and our wholly-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation.

Use of Estimates

Preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates made. We continually evaluate estimates used in the preparation of the condensed consolidated financial statements for reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. The significant areas of estimation include determining the allowance for doubtful accounts, deferred tax valuation allowance, accrued sales taxes, the estimated life of customer relationships and the estimated lives and recoverability of property and equipment.

See “Summary of Significant Accounting Policies” in the Company’s Audited 2011 Financial Statements for a discussion on the estimates and judgments necessary in the Company’s accounting for the allowance for doubtful accounts, financial instruments, concentration of credit risk, property and equipment, income taxes, stock-based compensation, and accrued sales taxes and regulatory fees.

Accounting Standards Updates

There have been no recent accounting pronouncements or changes in accounting pronouncements during the three months ended June 30, 2012, as compared to the recent accounting pronouncements described in the Company’s Audited 2011 Financial Statements, that are of material significance, or have potential material significance to the Company.

Revenue Recognition

Revenue billed in advance for monitoring and management services is deferred until the revenue has been earned, which is when the related services have been performed. Other service revenue, including amounts passed through based on surcharges from our telecom carriers, related to the network services and collaboration services are recognized as service is provided. As the non-refundable, upfront installation and activation fees charged to the subscribers do not meet the criteria as a separate unit of accounting, they are deferred and recognized over the 12 to 24 month period estimated life of the customer relationship. Revenue related to professional services is recognized at the time the services are performed, and presented as required by ASC Topic 605 “Revenue Recognition.” Revenues derived from other sources are recognized when services are provided or events occur.

Taxes Billed to Customers and Remitted to Taxing Authorities

We recognize taxes billed to customers in revenues and taxes remitted to taxing authorities in our operating costs, network and infrastructure. For the six and three months ended June 30, 2012, we included taxes of $796,000 and $393,000, respectively, in revenues and we included taxes of $764,000 and $372,000, respectively, in network and infrastructure costs. For the six and three months ended June 30, 2011, we included taxes of $846,000 and $415,000, respectively, in revenue and we included taxes of $801,000 and $392,000, respectively, in network and infrastructure costs.

Long-Lived Assets

We evaluate impairment losses on long-lived assets used in operations, primarily fixed assets, when events and circumstances indicate that the carrying value of the assets might not be recoverable as required by ASC topic 360 “Property, Plant and Equipment.” For purposes of evaluating the recoverability of long-lived assets, the undiscounted cash flows estimated to be generated by those assets are compared to the carrying amounts of those assets. If and when the carrying values of the assets exceed their fair values, then the related assets will be written down to fair value. In the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

Capitalized Software Costs

The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350.40 “Intangible – Goodwill and Other – Internal-Use Software.” Capitalized software costs are included in “Property and Equipment” on our consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. For the six and three months ended June 30, 2012, we capitalized internal use software costs of $161,000 and $77,000, respectively, and we amortized $279,000 and $139,000, respectively, of total software costs. For the six and three months ended June 30, 2011, we capitalized internal use software costs of $197,000 and $72,000, respectively, and we amortized $127,000 and $66,000, respectively, of these costs. During the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

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Restricted Stock Summary of Restricted Stock Granted, Vested, Forfeited and Outstanding (Details) (USD $) In Thousands, except Per Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2012
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Unvested restricted shares outstanding, beginning	836
Unvested restricted shares, weighted average grant price, beginning	$ 2.15
Granted, restricted shares	536
Granted, weighted average grant price	$ 2.95
Vested, restricted shares	(100)
Vested, weighted average grant price	$ 2.11
Forfeited, restricted shares	(110)
Forfeited, weighted average grant price	$ 2.55
Unvested restricted shares outstanding, ending	1,162
Unvested restricted shares, weighted average grant price, ending	$ 2.49

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Revolving Loan Facility Narrative (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Revolving Loan Facility Limit	$ 5,000,000		$ 5,000,000
Borrowings as Limited by Eligible Accounts Receivable, Percent	80.00%		80.00%
Debt Instrument, Description of Variable Rate Basis			Prime Rate as announced by Wall Street Journal ("WSJ") plus one and a quarter percent
Debt Instrument, Basis Spread on Variable Rate	1.25%		1.25%
minimum monthly interest			0.35%
WSJ Prime Rate			3.25%
outstanding Revolving Loan Facility	750,000		750,000
amortization of financing costs	14,000	16,000	29,000	31,000
Minimum [Member]
Line of Credit Facility, Amortization of Financing Costs, Term			12
Maximum [Member]
Line of Credit Facility, Amortization of Financing Costs, Term			24
Revolving Credit Facility [Member]
Revolving Loan Facility Limit	5,000,000		5,000,000
Unused Revolving Loan Facility	2,662,000		2,662,000
Revolving Loan Facility Unamortized financing costs	$ 33,000		$ 33,000

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CONDENSED CONSOLIDATED BALANCE SHEETS (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012	Dec. 31, 2011
ASSETS
Cash	$ 1,689	$ 1,818
Accounts receivable,net of allowance for doubtful accounts of $149 and $147, respectively	3,041	2,520
Prepaid expenses and other current assets	382	330
Total current assets	5,112	4,668
Property and equipment, net	4,325	4,738
Other assets	68	59
Total assets	9,505	9,465
LIABILITIES AND STOCKHOLDERS' EQUITY
Revolving loan facility	750	750
Current portion of capital lease	219	177
Accounts payable	1,369	1,382
Accrued expenses	405	1,024
Accrued sales taxes and regulatory fees	514	434
Customer deposits	167	139
Net current liabilities of discontinued operations	0	50
Deferred revenue	175	235
Total current liabilities	3,599	4,191
Capital lease, less current portion	320	334
Total long term liabilities	320	334
Total liabilities	3,919	4,525
Commitments and contingencies
Stockholders' equity:
Preferred stock Series B-1, non-convertible; $.0001 par value; $100,000 stated value; 100 shares authorized and 100 and 100 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively, liquidation value of $10,000	10,000	10,000
Preferred stock Series A-2, convertible; $.0001 par value; $7,500 stated value; 7,500 shares authorized and 53 and 94 shares issued and outstanding at June 30, 2012 and December 31, 2011 recorded at fair value, respectively, liquidation value of $396 and $704, respectively.	167	297
Common stock, $.0001 par value;150,000,000 shares authorized; 25,713,407 and 25,180,000 shares issued and outstanding at June 30, 2012 and December 31, 2011, respectively	3	3
Additional paid-in capital	159,695	159,339
Accumulated deficit	(164,279)	(164,699)
Total stockholders' equity	5,586	4,940
Total liabilities and stockholders' equity	$ 9,505	$ 9,465

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011
Cash flows from Operating Activities:
Net income	$ 420	$ 49
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation and amortization	865	573
Bad debt expense	52	(9)
Amortization of deferred financing costs	29	31
Loss on disposal of equipment	10	(12)
Stock-based compensation	219	147
Increase (decrease) attributable to changes in assets and liabilities:
Accounts receivable	(573)	(151)
Prepaid expenses and other current assets	(52)	(100)
Other assets	(38)	(43)
Accounts payable	(13)	(444)
Accrued expenses, sales taxes and regulatory fees	(539)	(258)
Customer deposits	28	(85)
Deferred revenue	(61)	39
Net cash provided by (used in) operating activities - continuing operations	347	(263)
Net cash (used in) provided by operating activities - discontinued operations	(50)	40
Net cash provided by (used in) operating activities	297	(223)
Cash flows from Investing Activities:
Proceeds from sale of equipment	11	0
Purchases of property and equipment	(353)	(554)
Net cash used in investing activities	(342)	(554)
Cash flows from Financing Activities:
Proceeds from exercise of stock options	7	0
Principal payments for capital lease	(91)	0
Net cash provided by financing activities	(84)	0
Increase (decrease) in cash and cash equivalents	(129)	(777)
Cash at beginning of period	1,818	2,035
Cash at end of period	1,689	1,258
Supplement disclosures of cash flow information:
Cash paid during the period for interest	29	32
Non-cash investing and financing activities:
Settlement of liabilities with restricted stock and stock options	0	48
Property and equipment purchased with common stock	0	1,581
Acquisition of network equipment under capital lease	120	512
Preferred stock conversion	$ 130	$ 0

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Preferred Stock Narrative (Details) (USD $)	3 Months Ended	6 Months Ended
	Jun. 30, 2012	Jun. 30, 2012	Dec. 31, 2011
Class of Stock [Line Items]
Certificate of Incorporation authorized Preferred Stock	5,000,000	5,000,000
Preferred Stock authorized	5,000,000	5,000,000
Preferred Stock issued	100	100	100
Conversion of Stock, Amount Converted	41
conversion price of convertible preferred stock		$ 3.00
Convertible Preferred Stock, Shares Issued upon Conversion	2,500	2,500
Conversion Price Below this Fair Value of the Common Stock		1.16
Series B Preferred Stock [Member]
Class of Stock [Line Items]
Cumulative Dividends from January 1, 2013		4.00%
Preferred Stock, Dividend Rate, Percentage		6.00%
Preferred Stock issued	100	100
Preferred Stock outstanding	100	100
Stated value	100,000	$ 100,000
Series A Preferred Stock [Member]
Class of Stock [Line Items]
Cumulative Dividends from January 1, 2013		5.00%
Certificate of Incorporation authorized Preferred Stock	7,500	7,500
Preferred Stock authorized	7,500	7,500
Preferred Stock issued	53	53
Preferred Stock outstanding	94	94
Stated value	7,500	$ 7,500
Series D Preferred Stock [Member]
Class of Stock [Line Items]
Certificate of Incorporation authorized Preferred Stock	4,000	4,000
Preferred Stock authorized	4,000	4,000
Preferred Stock issued	0	0
Preferred Stock outstanding	0	$ 0
Common Stock [Member]
Class of Stock [Line Items]
Convertible Preferred Stock, Shares Issued upon Conversion	2,500	2,500
Conversion of Stock, Shares Issued	103,000

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Stock Options (Tables)

6 Months Ended

Jun. 30, 2012

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Weighted average grant date fair value of options

The weighted average fair value of each option granted is estimated on the date of grant using the Black-Scholes option valuation model with the following weighted average assumptions during the six and three months ended June 30, 2012 and 2011:

	Six Months Ended June 30,		Three Months Ended June 30,
	2012	2011	2012	2011
Risk free interest rate	0.9%	2.1%	0.7%	N/A
Expected option lives	5 Years	5 Years	5 Years	N/A
Expected volatility	111.2%	117.4%	109.7%	N/A
Estimated forfeiture rate	10%	10%	10%	N/A
Expected dividend yields	—	—	—	—
Weighted average grant date fair value of options	$2.37	$1.87	$1.66	N/A

summary of options granted, exercised, expired and forfeited under our plans and options outstanding

A summary of options granted, exercised, expired and forfeited under our plans and options outstanding as of, and changes made during, the six months ended June 30, 2012 (in thousands):

	Outstanding				Exercisable
	Number of Options		Weighted Average Exercise Price		Number of Options	Weighted Average Exercise Price
Options outstanding, January 1, 2012	750		$	2.90	570	$	3.12
Granted	1,110		3.20
Exercised	(5	)	1.70
Expired	(3	)	16.01
Forfeited	(22	)	1.95
Options outstanding, June 30, 2012	1,830		$	3.07	594	$	2.98

Stock Options [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Stock option compensation expense is allocated

Stock option compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	6	$	38	$	3	$	19
Sales and marketing	4		10		3		4
General and administrative	80		16		62		8
	$	90	$	64	$	68	$	31

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Commitments and Contingencies Narrative (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Long-term Purchase Commitment [Line Items]
Operating Lease Payments	$ 136	$ 123	$ 264	$ 247
Letters of Credit Outstanding, Amount	115		115
Depreciation expense on the equipment under the capital leases	30		59
Lease1Member
Long-term Purchase Commitment [Line Items]
Value of non-cancelable Capital lease agreements	90	512	90	512
interest rates on non-cancelable capital lease agreements	9.00%	6.00%	9.00%	6.00%
Lease2Member
Long-term Purchase Commitment [Line Items]
Value of non-cancelable Capital lease agreements	$ 30	$ 40	$ 30	$ 40
interest rates on non-cancelable capital lease agreements	3.00%	0.00%	3.00%	0.00%

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Commitments and Contingencies Commitments and Contingencies (Tables)

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Schedule of Future Minimum Lease Payments for Capital Leases [Table Text Block]

Future minimum commitments under all non-cancelable capital leases are as follows (in thousands):

	Total		Interest		Principal
2012 remaining	126		14		112
2013	243		19		224
2014	194		6		188
2015	15		—		15
	$	578	$	39	$	539

Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]

Future minimum rental commitments under all non-cancelable operating leases are as follows (in thousands):

Year Ending December 31,
2012 remaining	$	241
2013	496
2014	167
2015	140
2016	145
2017	87
	$	1,276

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Basis of Presentation

6 Months Ended

Jun. 30, 2012

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis of Presentation

Basis of Presentation

The Business

Glowpoint, Inc. (“Glowpoint” or “we” or “us” or the “Company”) is a provider of cloud managed video services. Our services, delivered via our cloud-based OpenVideo™ platform, are securely accessible via any network (private or public) and are technology-agnostic. The Company delivers services to more than 500 different enterprises in over 35 countries supporting thousands of video endpoints, immersive telepresence rooms, and infrastructure for business-quality, real-time, two-way visual communications.

Glowpoint, a Delaware corporation, was formed in May 2000. The Company operates in one segment and therefore segment information is not presented.

Glowpoint's services are categorized as follows:

Monitoring & Management Services and Collaboration Services (“Managed Services Combined”). We provide end-to-end cloud managed services for telepresence, conference room, desktop, mobile solutions, and video infrastructure. We have a team of video experts utilizing the latest in remote management technologies. These engineering and operational customer support resources operate out of our three Video Network Operations Centers (VNOCs) located in the United States, in California, Pennsylvania, and New Jersey. These VNOC facilities provide global 24/7 support to our network and managed service customers, including our wholesale branded partners customers.  The primary functions of these operational resources located in these centers are customer service, conference production, network operation monitoring and remediation, and help desk technical support.

The company also maintains Points-of Presence (POP's) that houses the technology and infrastructure along with the servers and database warehousing for the OpenVideo platform and support systems of the business. There are currently three Points-of-Presence (POPs) located in the United States (New Jersey and Chicago) and United Kingdom (London), with additional POPs planned as needed. These carrier-neutral data centers are co-location facilities where network equipment that serves our video infrastructure is housed and acts as shared or dedicated infrastructure for our business customers. The POPs provide power redundancy & UPS (uninterrupted Power Supply) systems, which are constantly monitored and maintained. They also have physical security, flood controls, fire detection and suppression systems and are structurally designed for earthquakes.

We offer a complete portfolio of remote monitoring and management services that can help make video more widely available, improve up-time, drive higher usage, off-load IT teams, or all of the above. Our service packages can be customized to suit the needs of the business, whether for a large enterprise, small or medium sized business.

Glowpoint provides wholesale programs and private-labeled resale options for hardware manufacturers, network operators and systems integrators seeking to offer video services as a value-added addition to their collaboration and communications offerings. All of Glowpoint's unique features and services have been designed so that the entire suite can be private labeled by other service providers or companies who want to integrate video communications into their existing products quickly and cost effectively. Glowpoint will provide all of the video infrastructure and support, including customer portals and billing applications, as a private label service for a third party. This means that our services are branded with the other company's name, logo and other information, our live operators answer calls using the other company's name, and the other company's end user customers view the service as provided by that other company even though it is actually “powered by Glowpoint.” Glowpoint has been involved in a number of private label opportunities and currently provides branding of its services to six strategic global partners whom serve 147 customers with these services and support from Glowpoint through their unique brands. These services account for approximately 37% of Glowpoint's total revenue for the six months ended June 30, 2012. Many strategic global companies in the unified communications industry have recognized Glowpoint's value to their own sales and marketing efforts. These strategic partnerships are core to the company's global sales strategy.

Glowpoint's collaboration services, hosted via the OpenVideo™ cloud, are designed to connect video users all over the world whether they are on immersive telepresence, conference room, desktop or mobile devices. Customers that are registered to the OpenVideo™ cloud can connect to any other customer in the OpenVideo™ cloud and get access to Glowpoint's full suite of cloud managed video services, including the Virtual Video Room, video bridging, and webcasting services. Through our extensive partnerships, OpenVideo™ customers can also have business-to-business connectivity across other service providers platforms.

Network Services.In order to provide customers with access to the OpenVideo™ cloud, Glowpoint maintains a dedicated video overlay network. With our network services, we provide customers with the flexibility to either source the entire network from a single provider, maintain existing network and extend a logical connection to the OpenVideo™ cloud or bring bandwidth to OpenVideo™ datacenters. Although a declining component of our revenue stream, we believe that network services will continue to be an integral part of our revenue mix in the future, driven by new connectivity needs to connect and peer with Glowpoint's OpenVideo™ cloud.

Professional and other services. With the growing interest in convergence and the desire by some enterprises to add the transport of video to their enterprise networks, we have provided professional services and believe the market for such services is growing. Additionally, our extensive knowledge of all leading video conferencing vendors' equipment makes our video engineers a valuable resource for manufacturers, partners and end users on an outsourced basis. While our primary focus is generating monthly recurring revenue from our subscription services, our professional services have been a valuable lead for video communication opportunities leading to sales of our managed video services.

We have bundled certain components of our managed services to offer video communication solutions for broadcast/media content acquisition and event services. Customers have used our managed video services during events to cost-effectively acquire video content for broadcasters, cable companies and other media enterprises, especially in the sports, news and entertainment industries. While it includes our core managed video services, IP-based broadcasting and event services require more project management and dedicated operational and engineering personnel than our standard subscription services. Rather than using an expensive satellite feed, companies can acquire broadcast-quality standard or high definition footage at a fraction of the cost from Glowpoint over a dedicated IP connection. Since 2002, we have provided this service to ESPN during the professional football and basketball drafts. ESPN has used our service for interviews from team locations with coaches, players and analysts during their coverage. In 2007, we launched a High Definition (HD) content acquisition solution that we branded TeamCamHD and RemoteCamHD. This offering provides two-way HD video communication for content acquisition from remote locations. Glowpoint now provides a full suite of HD solutions for the broadcast, entertainment and media industry and is considered a high-quality alternative to the traditional means of acquiring content in many applications, including interviews and even full motion video.

Liquidity

For the six months ended June 30, 2012, we had net income of $420,000 and a positive cash flow from operations of $297,000. As of June 30, 2012, we had $1,689,000 of cash, positive working capital of $1,513,000 and an accumulated deficit of $164,279,000. In June 2012, the Company renewed its Revolving Loan Facility (as discussed in Note 10) pursuant to which the Company may borrow up to $5,000,000 for working capital purposes and under which we had unused borrowing availability of approximately $2,662,000 as of June 30, 2012. The Revolving Loan Facility matures in June 2014. Pursuant to the terms of our Series A-2 Preferred Stock and Series B-1 Preferred Stock, the Company will be obligated to pay dividends commencing on January 1, 2013. Based primarily on our efforts to manage costs and our Revolving Loan Facility, along with our cash flow projection, the Company believes that it has, and will have, sufficient cash flow to fund its operations through at least August 31, 2013. We have historically been able to raise capital in private placements as needed to fund operations and provide growth capital. There can be no assurances, however, that we will be able to raise additional capital as may be needed or upon acceptable terms, or that current economic conditions will not negatively impact us. If the current economic conditions negatively impact us and we are unable to raise additional capital that may be needed on terms acceptable to us, it could have a material adverse effect on the Company.

Quarterly Financial Information and Results of Operations

The condensed consolidated financial statements as of June 30, 2012 and for the six and three months ended June 30, 2012 and 2011 are unaudited and, in the opinion of management, include all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the financial position as of June 30, 2012, and the results of operations for the six and three months ended June 30, 2012 and 2011, the statement of stockholders’ equity for the six months ended June 30, 2012 and the statement of cash flows for the six months ended June 30, 2012 and 2011. The results for the six and three months ended June 30, 2012 are not necessarily indicative of the results to be expected for the entire year. While management of the Company believes that the disclosures presented are adequate to make the information not misleading, these condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and the footnotes thereto for the fiscal year ended December 31, 2011 as filed with the Securities and Exchange Commission with our Form 10-K on March 8, 2012 (the “Audited 2011 Financial Statements”).

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CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)	Jun. 30, 2012	Dec. 31, 2011
Current assets:
Accounts receivable, net of allowance for doubtful accounts	$ 149,000	$ 147,000
Stockholders' equity:
Preferred stock Series B-1, Par value	$ 0.0001	$ 0.0001
Preferred stock Series B-1, Stated value	100,000	100,000
Preferred Stock Series B-1, shares authorized	100	100
Preferred stock Series B-1, Shares issued	100	100
Preferred stock Series B-1, Shares outstanding	100	100
Preferred stock Series B-1, Liquidation value	10,000,000	10,000,000
Preferred stock Series A-2, Par value	$ 0.0001	$ 0.0001
Preferred stock Series A-2, Stated value	7,500	7,500
Preferred stock Series A-2, Shares Authorized	7,500	7,500
PPreferred stock Series A-2, Shares issued	53	94
Preferred stock Series A-2, Shares outstanding	53	94
Preferred stock Series A-2, Liquidation value	$ 396,000	$ 704,000
Common stock, Par value	$ 0.0001	$ 0.0001
Common stock, Authorized	150,000,000	150,000,000
Common stock, Issued	25,713,407	25,180,000
Common stock, Outstanding	25,713,407	25,180,000

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Discontinued Operations

6 Months Ended

Jun. 30, 2011

Discontinued Operation, Additional Disclosures [Abstract]

Discontinued Operations

Discontinued Operations

As our ISDN resale services no longer fit into our overall strategic plan, in September 2010, we entered into an agreement with an independent telecommunications service provider to transfer these services and the related customers, and the Company receives a 15% monthly recurring referral fee for those revenues for as long as the customers maintain service. Such amounts were de minimis for the six and three months ended June 30, 2012 and were $12,000 for the six and three months ended June 30, 2011. The transfer of the customers was completed in the third quarter of 2011, and the Company will have no continuing involvement with the ISDN product line.

The Company accordingly classified these ISDN related revenues and expenses as discontinued operations in accordance with ASC 205.20 “Discontinued Operations.” The accompanying condensed consolidated financial statements reflect the operating results and balance sheet items of the discontinued operations separately from continuing operations. Prior year financial statements have been restated in conformity with generally accepted accounting principles to present the operations of the ISDN resale services as a discontinued operation.

Revenues from the ISDN resale services, reported as discontinued operations, for the six and three months ended June 30, 2011 were $81,000 and $30,000, respectively. Net income from the ISDN resale services, reported as discontinued operations for the six and three months ended June 30, 2011 were $18,000 and $24,000, respectively. The assets and liabilities from the ISDN resale services, reported as net current liabilities of discontinued operations, as of June 30, 2011 were $25,000. No income tax provision was required to be recognized by the Company against income from the ISDN resale services over the related periods.

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Document and Entity Information	6 Months Ended
	Jun. 30, 2012	Aug. 13, 2012
Document and Entity Information
Entity Registrant Name	GLOWPOINT, INC.
Entity Central Index Key	0000746210
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Document Type	10-Q
Document Period End Date	Jun. 30, 2012
Document Fiscal Year Focus	2012
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		25,593,967
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes

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Related Party Transactions

6 Months Ended

Jun. 30, 2012

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company provides cloud-managed video services (the “Video Services”) to a company in which one of our directors is an officer. Management believes that such transactions contain terms that would have been obtained from unaffiliated third parties. Related party Video Services revenue for the six months ended June 30, 2012 and 2011 were $125,000 and $161,000, respectively, and for the three months ended June 30, 2012 and 2011 were $59,000 and $81,000, respectively. The accounts receivable for this company was $31,000 as of June 30, 2012.

One of our directors currently provides general corporate strategy and management consulting services to the Company under a Consulting Agreement entered into as of September 1, 2010 (the “Consulting Agreement”). The Company pays this individual director $12,500 per month, plus any pre-authorized expenses incurred in providing services, under the Consulting Agreement. The term of the engagement is month-to-month.

In addition, the Company receives financial advisory services from a firm in which one of the principals is a shareholder of Glowpoint. Management believes that such transactions contain terms that would have been obtained from unaffiliated third parties. Related party financial advisory fees for the six months ended June 30, 2012 and 2011 were $72,000 and $72,000, respectively and for the three months ended June 30, 2012 and 2011 were $36,000 and $36,000, respectively. As of June 30, 2012, there was no accounts payable for this firm.

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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Income Statement [Abstract]
Revenue	$ 6,800	$ 6,954	$ 13,546	$ 13,935
Operating expenses:
Network and infrastructure	2,145	2,471	4,221	4,883
Global managed services	1,765	1,979	3,461	3,873
Sales and marketing	878	902	1,864	1,824
General and administrative	1,302	1,282	2,652	2,688
Depreciation and amortization	425	297	865	573
Total operating expenses	6,515	6,931	13,063	13,841
Income from operations	285	23	483	94
Interest and other expense:
Interest expense, net	18	14	29	32
Amortization of deferred financing costs	14	16	29	31
Total interest and other expense,net	32	30	58	63
Income from continuing operations	253	(7)	425	31
Disposal Group, Including Discontinued Operation, Operating Income (Loss)	0	24	0	18
Income (Loss) Attributable to Parent	253	17	425	49
Provision for income taxes	5	0	5	0
Net income	$ 248	$ 17	$ 420	$ 49
Net income per share:
Continuing operations	$ 0.01	$ 0.00	$ 0.02	$ 0.00
Discontinued operations	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Basic net income per share	$ 0.01	$ 0.00	$ 0.02	$ 0.00
Continuing operations	$ 0.01	$ 0.00	$ 0.02	$ 0.00
Discontinued operations	$ 0.00	$ 0.00	$ 0.00	$ 0.00
Diluted net income per share	$ 0.01	$ 0.00	$ 0.02	$ 0.00
Weighted average number of common shares:
Basic	24,525	20,753	24,440	20,714
Diluted	25,874	24,594	25,742	24,594

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Earnings Per Share

6 Months Ended

Jun. 30, 2012

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per Share

Earnings per share is calculated by dividing net income by the weighted average number of shares of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution from the conversion or exercise into common stock of securities such as stock options and warrants. For the six and three months ended June 30, 2012, diluted earnings per share included 140,000 and 106,000, respectively, shares of common stock associated with outstanding options and warrants, 133,000 shares issuable upon conversion of our convertible preferred stock calculated using the treasury stock method, and 1,163,000 shares of unvested restricted stock.

For the six and three months ended June 30, 2011, diluted earnings per share included 500,000 and 469,000, respectively, shares of common stock associated with outstanding options and warrants, 2,648,000 shares issuable upon conversion of our convertible preferred stock calculated using the treasury stock method, and 728,000 shares of unvested restricted stock.

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Warrants

6 Months Ended

Jun. 30, 2012

Warrants and Rights Note Disclosure [Abstract]

Warrants

Warrants

There were no warrants granted, exercised, exchanged or forfeited during the six months ended June 30, 2012. There were 33,000 warrants outstanding as of June 30, 2012 with an exercise price of $1.60 and an expiration date of November 25, 2013.

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Restricted Stock (Tables)

6 Months Ended

Jun. 30, 2012

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Summary of restricted stock granted, vested, forfeited and unvested outstanding

A summary of restricted stock granted, vested, forfeited and unvested outstanding as of, and changes made during, the six months ended June 30, 2012, is presented below (in thousands):

	Restricted Shares		Weighted Average Grant Price
Unvested restricted shares outstanding, January 1, 2012	836		$	2.15
Granted	536		2.95
Vested	(100	)	2.11
Forfeited	(110	)	2.55
Unvested restricted shares outstanding, June 30, 2012	1,162		$	2.49

Restricted Stock [Member]

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]

Restricted stock compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	16	$	18	$	10	$	8
Sales and marketing	30		9		16		7
General and administrative	83		56		46		24
	$	129	$	83	$	72	$	39

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Asset Purchase Agreement

6 Months Ended

Jun. 30, 2012

Asset Purchase Agreement [Abstract]

Asset Purchase Agreement

Asset Purchase Agreement

On June 30, 2011, the Company issued 769,000 shares of common stock as consideration for the purchase of assets pursuant to the terms of a purchase agreement. The assets acquired are equipment primarily used in the delivery and management of hosted video bridging and help desk and concierge services and are classified as property and equipment on the accompanying consolidated balance sheet. The total number of shares was based on consideration equal to $1,581,000 using the common stock’s 30-day trailing volume-weighted average price for the period ended June 28, 2011 of $2.05 (the “VWAP”). This transaction did not meet the requirements of a business combination and therefore was accounted for as an asset purchase with the fair value of the assets purchased equal to the consideration given. The equipment will be depreciated on a straight line basis over five years.

Pursuant to the agreement, if at any time between the first anniversary of the closing date and the date that is 18 months following the closing date (the “repurchase period”) the closing price of the Company’s common stock shall fall below the VWAP, then the seller has the right to demand that the Company repurchase from it, in a single transaction, not more than 50% of the shares delivered to such seller at closing at a price equal to the VWAP. This will result in a derivative liability and will be accounted for with changes in fair value during the repurchase period recorded in earnings. As of June 30, 2012, there was no derivative liability.

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Major Customers

6 Months Ended

Jun. 30, 2012

Concentration Risks, Types, Major Customers [Abstract]

Major Customers

Major Customers

Major customers are those customers / wholesale partners that account for more than 10% of revenues. For the six and three months ended June 30, 2012, approximately 37% and 36% of revenues, respectively, were derived from three major wholesale partners and the accounts receivable from these major partners represented approximately 49% of total accounts receivable as of June 30, 2012. For the six and three months ended June 30, 2011, approximately 26% and 22% of revenues, respectively, were derived from two major wholesale partners. The loss of any one of these partners would have a material adverse affect on the Company’s operations.

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Preferred Stock

6 Months Ended

Jun. 30, 2012

Preferred Stock [Abstract]

Preferred Stock

Preferred Stock

Our Certificate of Incorporation authorizes the issuance of up to 5,000,000 shares of preferred stock. As of June 30, 2012, there were: 100 shares of Series B-1 Preferred Stock authorized, issued and outstanding; 7,500 shares of Series A-2 Preferred Stock authorized and 53 shares issued and outstanding; and 4,000 shares of Series D Preferred Stock authorized and no shares issued or outstanding.

Each share of Series B-1 Preferred Stock has a stated value of $100,000 per share (the “Series B-1 Stated Value”), and a liquidation preference equal to the Series B-1 Stated Value plus all accrued and unpaid dividends (the “Series B-1 Liquidation Preference”). The Series B-1 Preferred Stock is not convertible into common stock. The Series B-1 Preferred Stock is senior to all other classes of equity and, commencing on January 1, 2013, is entitled to cumulative dividends from January 1, 2013, at a rate of 4% per annum, payable quarterly, based on the Series B-1 Stated Value. Commencing January 1, 2014, the cumulative dividend rate increases to 6% per annum, payable quarterly, based on the Series B-1 Stated Value. The Company may, at its option at any time, redeem all or a portion of the outstanding shares of Series B-1 Preferred Stock by paying the Series B-1 Liquidation Preference.

Each share of Series A-2 Preferred Stock has a stated value of $7,500 per share (the “A-2 Stated Value”), a liquidation preference equal to the Series A-2 Stated Value, and is convertible at the holder’s election into common stock at a conversion price per share of $3.00. Therefore, each share of Series A-2 Preferred Stock is convertible into 2,500 shares of common stock. The Series A-2 Preferred Stock is subordinate to the Series B-1 Preferred Stock but senior to all other classes of equity, has weighted average anti-dilution protection and, commencing on January 1, 2013, is entitled to cumulative dividends at a rate of 5% per annum, payable quarterly, based on the Series A-2 Stated Value. Once dividend payments commence, all dividends are payable at the option of the holder in cash or through the issuance of a number of additional shares of Series A-2 Preferred Stock with an aggregate liquidation preference equal to the dividend amount payable on the applicable dividend payment date.

In April 2012, a holder of the Company's Series A-2 Preferred Stock elected to convert 41 shares of Series A-2 Preferred Stock into 103,000 shares of common stock of the Company at the original conversion price. Each of the Series A-2 Preferred Stock shares was exchanged for 2,500 shares of common stock, pursuant to the terms of the Series A-2 Preferred Stock Certificate of Designation.

In accordance with ASC Topic 815, we evaluated whether our convertible preferred stock contains provisions that protect holders from declines in our stock price or otherwise couldresult in modification of the exercise price and/or shares to be issued under the respective preferred stock agreements based on a variable that is not an input to the fairvalue of a “fixed-for-fixed” option and require a derivative liability. The Company determined no derivative liability is required under ASC Topic 815 with respect to our convertible preferred stock. A contingent beneficial conversion amount is required to be calculated and recognized when and if the adjusted $3.00 conversion price of the convertible preferred stock is adjusted to reflect a down round stock issuance that reduces the conversion price below the $1.16 fair value of the common stock on the issuance date of the convertible preferred stock.

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2012

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Operating Leases

We lease several facilities under operating leases expiring through 2017. Certain leases require us to pay increases in real estate taxes, operating costs and repairs over certain base year amounts. Lease payments for the six and three months ended June 30, 2012 were $264,000 and $136,000, respectively. Lease payments for the six and three months ended June 30, 2011 were $247,000 and $123,000, respectively.

Future minimum rental commitments under all non-cancelable operating leases are as follows (in thousands):

Year Ending December 31,
2012 remaining	$	241
2013	496
2014	167
2015	140
2016	145
2017	87
	$	1,276

Capital Lease Obligation

In 2012, the Company entered into two non-cancelable lease agreements for $90,000 and $30,000 with interest rates of 9% and 3%, respectively. In 2011, the Company entered into two non-cancelable lease agreements for $512,000 and $40,000 with interest rates of 6% and 0%, respectively. These leases are accounted for as capital leases. Depreciation expense on the equipment under the capital leases for the six and three months ended June 30, 2012 was $59,000 and $30,000, respectively. There were no depreciation expenses on the equipment under the capital leases for the six and three months ended June 30, 2011. Future minimum commitments under all non-cancelable capital leases are as follows (in thousands):

	Total		Interest		Principal
2012 remaining	126		14		112
2013	243		19		224
2014	194		6		188
2015	15		—		15
	$	578	$	39	$	539

Commercial Commitments

We have entered into a number of agreements with telecommunications companies to purchase communications services. Some of the agreements require a minimum amount of services to be purchased over the life of the agreement, or during a specified period of time.

Glowpoint believes that it will meet its commercial commitments. In certain instances where Glowpoint did not meet the minimum commitments, no penalties for minimum commitments have been assessed and the Company has entered into new agreements. It has been our experience that the prices and terms of successor agreements are similar to those offered by other carriers.

Glowpoint does not believe that any loss contingency related to a potential shortfall should be recorded in the condensed consolidated financial statements because it is not probable, from the information available and from prior experience, that Glowpoint has incurred a liability.

Letter of Credit

In November 2010, the Company entered into an irrevocable standby letter of credit (the “LOC”) for $115,000 to secure our security deposit for the sublease of our corporate headquarters. The LOC was obtained from Silicon Valley Bank (“SVB”) and will be renewed yearly until January 2014, the expiration date of our sublease.

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Revolving Loan Facility

6 Months Ended

Jun. 30, 2012

Line of Credit Facility [Abstract]

Revolving Loan Facility

Revolving Loan Facility

On June 12, 2012, the Company entered into the Second Loan Modification Agreement (as amended, the “Revolving Loan Facility”) which amends its existing Loan and Security Agreement with SVB pursuant to which the Company may borrow up to $5,000,000 for working capital purposes. The Revolving Loan Facility matures June 2014. The amounts that can be borrowed at any given time are equal to the lesser of $5,000,000 or 80% of the eligible accounts receivable, as defined. As of June 30, 2012, we had unused borrowing availability of $2,662,000. Outstanding principal amounts under the Revolving Loan Facility were modified to bear interest at a floating Prime rate per annum equal to Prime Rate as announced by Wall Street Journal ("WSJ") plus one and a quarter percent (1.25%), payable monthly in arrears. The Company is no longer obligated to pay a minimum monthly interest but a fee equal to 0.35% of the unused borrowing amount each year. The WSJ Prime Rate was 3.25% as of June 30, 2012. The Revolving Loan Facility is secured by a first priority security interest in all the Company’s assets, including, without limitation, its intellectual property. The Revolving Loan Facility contains a number of financial covenants, including, but not limited to, covenants relating to minimum unrestricted cash balances and minimum monthly Adjusted EBITDA, as defined, in the Revolving Loan Facility. At June 30, 2012, we were in compliance with the covenants, as defined and set forth in the Revolving Loan Facility and there was $750,000 outstanding under the Revolving Loan Facility.

The Revolving Loan Facility financing costs, net of accumulated amortization, which are included in other assets in the accompanying consolidated balance sheets, were $33,000 as of June 30, 2012. The financing costs for the Revolving Loan Facility are being amortized over the 12- to 24-month period through the maturity date of the Revolving Loan Facility. During the quarters ended June 30, 2012 and 2011, the amortization of financing costs was $14,000 and $16,000 was included as “Amortization of Deferred Financing Costs” in the consolidated statement of operations in Interest and Other Expense.

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Earnings Per Share Narrative (Details) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Earnings Per Share [Abstract]
Dilutive Common Shares Attributable to outstanding options and warrants	106	469	140	500
Dilutive Common Shares Attributable to convertible preferred stock	133	2,648	133	2,648
Dilutive Common Shares Attributable to unvested restricted stock	1,163	728	1,163	728

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2012

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation

The condensed consolidated financial statements include the accounts of Glowpoint and our wholly-owned subsidiary, GP Communications, LLC, whose business function is to provide interstate telecommunications services for regulatory purposes. All material inter-company balances and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

Preparation of the condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from the estimates made. We continually evaluate estimates used in the preparation of the condensed consolidated financial statements for reasonableness. Appropriate adjustments, if any, to the estimates used are made prospectively based upon such periodic evaluation. The significant areas of estimation include determining the allowance for doubtful accounts, deferred tax valuation allowance, accrued sales taxes, the estimated life of customer relationships and the estimated lives and recoverability of property and equipment.

See “Summary of Significant Accounting Policies” in the Company’s Audited 2011 Financial Statements for a discussion on the estimates and judgments necessary in the Company’s accounting for the allowance for doubtful accounts, financial instruments, concentration of credit risk, property and equipment, income taxes, stock-based compensation, and accrued sales taxes and regulatory fees.

Accounting Standards Updates

Accounting Standards Updates

There have been no recent accounting pronouncements or changes in accounting pronouncements during the three months ended June 30, 2012, as compared to the recent accounting pronouncements described in the Company’s Audited 2011 Financial Statements, that are of material significance, or have potential material significance to the Company.

Revenue Recognition

Revenue Recognition

Revenue billed in advance for monitoring and management services is deferred until the revenue has been earned, which is when the related services have been performed. Other service revenue, including amounts passed through based on surcharges from our telecom carriers, related to the network services and collaboration services are recognized as service is provided. As the non-refundable, upfront installation and activation fees charged to the subscribers do not meet the criteria as a separate unit of accounting, they are deferred and recognized over the 12 to 24 month period estimated life of the customer relationship. Revenue related to professional services is recognized at the time the services are performed, and presented as required by ASC Topic 605 “Revenue Recognition.” Revenues derived from other sources are recognized when services are provided or events occur.

Long-Lived Assets

Long-Lived Assets

We evaluate impairment losses on long-lived assets used in operations, primarily fixed assets, when events and circumstances indicate that the carrying value of the assets might not be recoverable as required by ASC topic 360 “Property, Plant and Equipment.” For purposes of evaluating the recoverability of long-lived assets, the undiscounted cash flows estimated to be generated by those assets are compared to the carrying amounts of those assets. If and when the carrying values of the assets exceed their fair values, then the related assets will be written down to fair value. In the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

Capitalized Software Costs

Capitalized Software Costs

The Company capitalizes certain costs incurred in connection with developing or obtaining internal-use software. All software development costs have been appropriately accounted for as required by ASC Topic 350.40 “Intangible – Goodwill and Other – Internal-Use Software.” Capitalized software costs are included in “Property and Equipment” on our consolidated balance sheets and are amortized over three to four years. Software costs that do not meet capitalization criteria are expensed as incurred. For the six and three months ended June 30, 2012, we capitalized internal use software costs of $161,000 and $77,000, respectively, and we amortized $279,000 and $139,000, respectively, of total software costs. For the six and three months ended June 30, 2011, we capitalized internal use software costs of $197,000 and $72,000, respectively, and we amortized $127,000 and $66,000, respectively, of these costs. During the six and three months ended June 30, 2012 and 2011, no impairment losses were recorded.

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Summary of Significant Accounting Policies Summary of Significant Accounting Policies (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Finite-Lived Intangible Assets [Line Items]
Capitalized Computer Software, Additions	$ 77	$ 72	$ 161	$ 197
Capitalized Computer Software, Amortization	(139)	(66)	(279)	(127)
taxes billed to customers in revenues	393	415	796	846
taxes remitted to taxing authorities in our operating costs, network and infrastructure	$ 372	$ 392	$ 764	$ 801
Minimum [Member] | Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life			12 months
Maximum [Member] | Customer Relationships [Member]
Finite-Lived Intangible Assets [Line Items]
Finite-Lived Intangible Asset, Useful Life			24 months

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Discontinued Operations Narrative (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Discontinued Operations and Disposal Groups [Abstract]
monthly recurring referral fee			15.00%
Recurring Referral Fee			$ 12
Revenues from the ISDN resale services		(30)		(81)
Net income from the ISDN resale services	0	24	0	18
net current liabilities of discontinued operations				$ (25)

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CONDENSED CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (USD $) In Thousands, except Share data	Total	Series B Preferred Stock [Member]	Series A-2 Preferred Stock [Member]	Common Stock [Member]	Additional Paid-In Capital [Member]	Retained Earnings / Accumulated Deficit [Member]
Beginning Balance, Amount at Dec. 31, 2011	$ 4,940	$ 10,000	$ 297	$ 3	$ 159,339	$ (164,699)
Beginning Balance, Shares at Dec. 31, 2011		100	94	25,180,000
Net income	420				0	420
Stock-based compensation	219				219	0
Issuance of restricted stock, Shares				536,000
Issuance of restricted stock, Amount	0			0
Stock Issued During Period, Shares, Restricted Stock Award, Forfeited				(110,000)
Stock Issued During Period, Value, Restricted Stock Award, Forfeitures	0			0
Stock Issued During Period, Shares, Conversion of Convertible Securities			(41)	102,000
Stock Issued During Period, Value, Conversion of Convertible Securities	0		(130)	0	130
Outstanding Number of Options, Exercised				5,000
Exercise of options, Amount	7			0	7
Ending Balance, Amount at Jun. 30, 2012	$ 5,586	$ 10,000	$ 167	$ 3	$ 159,695	$ (164,279)
Ending Balance, Shares at Jun. 30, 2012		100	53	25,713,000

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Restricted Stock

6 Months Ended

Jun. 30, 2012

Restricted Stock [Abstract]

Restricted Stock

Restricted Stock    

A summary of restricted stock granted, vested, forfeited and unvested outstanding as of, and changes made during, the six months ended June 30, 2012, is presented below (in thousands):

	Restricted Shares		Weighted Average Grant Price
Unvested restricted shares outstanding, January 1, 2012	836		$	2.15
Granted	536		2.95
Vested	(100	)	2.11
Forfeited	(110	)	2.55
Unvested restricted shares outstanding, June 30, 2012	1,162		$	2.49

Restricted stock compensation expense is allocated as follows for the six and three months ended June 30, 2012 and 2011 (in thousands):

	Six Months Ended June 30,				Three Months Ended June 30,
	2012		2011		2012		2011
Global managed services	$	16	$	18	$	10	$	8
Sales and marketing	30		9		16		7
General and administrative	83		56		46		24
	$	129	$	83	$	72	$	39

The remaining unrecognized stock-based compensation expense for restricted stock at June 30, 2012 was $2,639,000, of which $330,000, representing 130,000 shares, will only be expensed upon a “change in control” and the remaining $2,309,000 will be amortized over a weighted average period of 8.8 years .

The tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2012 was diminimus. There was no tax benefit recognized for stock-based compensation for the six and three months ended June 30, 2011. No compensation costs were capitalized as part of the cost of an asset.

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Stock Options Narrative (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2012	Jun. 30, 2011	Jun. 30, 2012	Jun. 30, 2011
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
intrinsic value of options outstanding and exercisable	$ 143	$ 108	$ 143	$ 108
Options exercised	0	(64,000)	5,000	(124,000)
unrecognized stock-based compensation option			2,748
unrecognized stock-based compensation expensed option upon change in control			2,339
unrecognized stock-based compensation options depending upon change in control			1,000,000
unrecognized stock-based compensation expensed option others			$ 409
Stock Options [Member]
Employee Stock Ownership Plan (ESOP) Disclosures [Line Items]
weighted average period for amortization of option			1 year 10 months 24 days

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Commitments and Contingencies Tables Capital Lease (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2012
Commitments and Contingencies Disclosure [Abstract]
2012 remaining,Total	$ 126
2012 remaining,Interest	14
2012 remaining,Principal	112
2013,Total	243
2013,Interest	19
2013,Principal	224
2014,Total	194
2014,Interest	6
2014,Principal	188
2015, Total	15
2015, Interest	0
2015, Principal	15
Capital Lease Total	578
Capital Lease Interest Total	39
Capital Lease Principal Total	$ 539

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Subsequent Events

6 Months Ended

Jun. 30, 2012

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Management Changes

In July 2012, Michael S. Hubner, the Company’s General Counsel and Corporate Secretary, notified the Company that he was resigning effective August 2, 2012 in order to pursue other business opportunities outside of the video conferencing industry. His resignation was not the result of any disagreement relating to the Company’s business practices or legal matters. In accordance with the terms of the employment agreement entered into on March 12, 2012 by Mr. Hubner and the Company, Mr. Hubner is not entitled to receive any severance payments and all restricted stock and stock options previously granted to Mr. Hubner will be forfeited to the Company.

Affinity Acquisition

On August 12, 2012, the Company entered into an Agreement and Plan of Merger (the "Merger Agreement") with Affinity VideoNet, Inc., a privately held Delaware corporation ("Affinity"), and GPAV Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of the Company ("Merger Sub"). Pursuant to the Merger Agreement and subject to customary closing conditions, Merger Sub will merge with and into Affinity, and Affinity will become a wholly-owned subsidiary of the Company. The Merger is anticipated to close in the third quarter of 2012 and is expected to be funded with $7,750,000 cash sourced through debt financing, the issuance of $2,750,000 note, and the issuance of 2,650,000 shares of common stock.

The consummation of the Merger is subject to various conditions, including, but not limited to, (i) the accuracy of the representations and warranties with respect to certain matters, and (ii) the consummation of certain debt financing relating to the transaction. The Merger Agreement also contains customary representations, warranties and indemnification provisions.

The Merger will be treated by the Company under the acquisition method of accounting, as prescribed in Accounting Standards Codification 805, “Business Combinations,” for business combinations under GAAP. The Company will be deemed to have acquired the assets and liabilities of Affinity and the results of operations will be consolidated into the results of operations of the Company as of the completion of the Merger. Financial statements in quarterly and annual filings of the new Company issued after the Merger will reflect only the operations of the Company's business after the Merger and will not be restated retroactively to reflect the historical financial position or results of operations of the Company.