Trends in Telephone Service Industry Analysis and Technology Division Wireline Competition Bureau February 2007 This report is available for reference in the FCC’s Information Center at 445 12th Street, S.W., Courtyard Level. Copies may be purchased by calling Best Copy and Printing, Inc., Portals II, 445 12th Street S.W., Room CY-B402, Washington DC 20554 at 800-378-3160, facsimile 202-488-5563, or via e-mail fcc@bcpiweb.com. The report can also be downloaded from the Wireline Competition Bureau Statistical Reports Internet site at: www.fcc.gov/wcb/iatd/trends.html. Table of Contents 1-1 1-1 Table 1.1 Interstate Per-Line Access Charges……………………………………………………… 1-3 Table 1.2 Interstate Per-Minute Access Charges…………………………………………………… 1-4 Table 1.3 Interstate Per-Line Access Charges by Carrier…………...……………………………… 1-5 Table 1.4 Interstate Per-Minute Access Charges by Carrier……………………………… ……… 1-6 2-1 Table 2.1 High-Speed Lines………………………………………………………………………… 2-3 Chart 2.1 Total High-Speed Lines…………………………………………………………………… 2-3 Chart 2.2 High-Speed Lines by Technology………………………………………………………… 2-3 Table 2.2 Advance Services Lines………………………………………………………………… 2-4 Chart 2.3 Advance Services Lines………………………………………………………………… 2-4 Chart 2.4 Advance Services Lines by Technology………………………………………………… 2-4 Table 2.3 Residential High-Speed Lines…………………………………………………………… 2-5 Chart 2.5 Residential High-Speed Lines…………………………………………………………… 2-5 Chart 2.6 Residential High-Speed Lines by Technology…………………………………………… 2-5 Table 2.4 Residential Advanced Services Lines…………………………………………………… 2-6 Chart 2.7 Residential Advanced Services Lines…………………………………………………… 2-6 Chart 2.8 Residential Advanced Services Lines by Technology…………………………………… 2-6 Table 2.5 High-Speed Lines by Information Transfer Rates……………………………………… 2-7 Chart 2.9 High-Speed Lines by Information Transfer Rates in the Faster Direction……………… 2-7 Table 2.6 High-Speed Lines by Technology………………………………………………………… 2-9 Table 2.7 High-Speed Lines by State……………………………………………………………… 2-10 Table 2.8 Percentage of Residential End-User Premises with Access to High-Speed Services…… 2-11 Chart 2.10 Percentage of U.S. Households with Computers, Internet Access, and High-Speed Access…………………………………………………………………….. 2-12 Table 2.9 Percent of U.S. Households with Internet: Rural vs Urban……………………………… 2-13 Chart 2.11 Percent of U.S. Households with Internet Connections by Technology: Rural vs Urban……………………………………………………………………. 2-13 Consumer Expenditures…………………………………………………………………………… 3-1 Table 3.1 Household Expenditures for Telephone Service………………………………………… 3-3 Table 3.2 Average Monthly Household Telecommunications Expenditures by Type of Provider………………………………………………………………………… 3-4 Table 3.3 Personal Consumption Expenditures……………………………………………………. 3-5 Chart 3.1 Personal Consumption Expenditures for Telephone Service…………………………… 3-6 Chart 3.2 Monthly Personal Consumption Expenditures for Telephone Service…………………… 3-6 Introduction……………………………………….……………………………………………… Access Charges…………………………………………………………………………………… Advanced Telecommunications…………………………………………………………………… i Earnings …………………………………………………………………………………………. 4-1 Table 4.1 Interstate Rate-of-Return Summary: Years 1998 through 2005 ………………………… 4-3 Employment and Labor Productivity …………………………………………………………. 5-1 Table 5.1 Average Number of Employees in the Telecommunications Industry ………………… 5-3 Chart 5.1 Average Number of Employees in the Telecommunications Industry ...………………… 5-3 Table 5.2 Labor Productivity Index for the Wired and Wireless Telecommunications Industry …………………………………………………………… 5-4 Chart 5.2 Wired and Wireless Telecommunications Carriers (NAICS 5171 and 5172) Labor Productivity Index ……………………………………. 5-4 Table 5.3 Number of Telecommunications Providers by Size of Business ………………………… 5-5 International Telephone Service ………………………………………………………………… 6-1 Table 6.1 International Service from the United States …………………………………………… 6-3 Chart 6.1 Billed Revenues per Minute and per Call ……………………………………………… 6-3 Table 6.2 International Telephone Service Settlements …………………………………………… 6-4 Table 6.3 International Message Telephone Service for 2004 …………………………………… 6-5 Chart 6.2 U.S. Billed Minutes by Country for 2004 ……………………………………………… 6-5 Table 6.4 U.S. Billed Revenues of Facilities-Based and Facilities-Resale Carriers in 2004……… 6-6 Table 6.5 Top Providers of Pure Resale International MTS in 2004 ……………………………… 6-7 Lines ……………………………………………………………………………………………… 7-1 Table 7.1 U.S. Wireline Telephone Lines ………………………………………………………… 7-3 Table 7.2 Telephone Loops of Incumbent Local Exchange Carriers by State ……………………… 7-4 Table 7.3 Telephone Loops of Incumbent Local Exchange Carriers by Holding Company ……… 7-6 Chart 7.1 Five Largest Holding Companies' Share of Loops ……………………………………… 7-6 Table 7.4 Additional Residential Lines for Households with Telephone Service ………………… 7-8 Table 7.5 Number of Payphones Owned by LECs and Independent Operators …………………… 7-9 Table 7.6 Number of Payphones Over Time ………………………………….…………………… 7-11 Local Telephone Competition …………………………………………………………………… 8-1 Table 8.1 End-User Switched Access Lines Reported …………………………….…..…………. 8-5 Chart 8.1 End-User Switched Access Lines Reported …………………………….…..…………. 8-5 Table 8.2 End-User Switched Access Lines by Customer Type …..……………….…..………… 8-6 Chart 8.2 Percent of Lines that Serve Residential Customers ……………………………………… 8-6 ii Table 8.3 Reporting Competitive Local Exchange Carriers ……………………………………… 8-7 Chart 8.3 Competitive Local Exchange Carriers' End-Users Lines ……………………………… 8-7 Table 8.4 Reporting Incumbent Local Exchange Carriers ………………………………………… 8-8 Chart 8.4 ILEC Lines and the Percent Provided to Other Carriers ……………………………… 8-8 Table 8.5 End-User Switched Access Lines Served By Reporting Local Exchange Carriers …… 8-9 Table 8.6 Competitive Local Exchange Carriers Share of End-User Switched Access Lines …… 8-10 Table 8.7 Nationwide Local Service Revenues and New Competitors' Share …………………… 8-11 Chart 8.5 ILEC and New Local Competitor Share of Local Service Revenue ..………………… 8-11 Table 8.8 Telephone Number Porting Activity Since Wireless Pooling Started ………………… 8-13 Table 8.9 Telephone Numbers Remaining in the Porting Database in Each Quarter …………… 8-14 Table 8.10 Numbers in the Porting Database by Quarter Most Recently Ported …………………… 8-15 Long Distance Telephone Industry………………………………………………………… 9-1 Table 9.1 Total Toll Service Revenues by Provider ……………………………………………… 9-5 Table 9.2 Intrastate, Interstate, and International Toll Revenues ………………………………… 9-7 Chart 9.1 Toll Revenues by Market Segment …………………………………………………… 9-7 Table 9.3 End-User Toll Revenues ……………………………………………………………… 9-8 Table 9.4 Number of Toll Service Providers ……………………………………………………… 9-9 Table 9.5 Residential Household Market Shares ………………………………………………… 9-10 Chart 9.2 Residential Household Market Shares ………………………………………………… 9-10 Table 9.6 Residential Household Market Shares by Region: 2005 ……………………………… 9-12 Chart 9.3 Residential Household Market Shares by Region: 2005 ……………………………… 9-12 Table 9.7 Regional Bell Operating Companies'Applications to Provide In-Region InterLATA Service ………………………………………………… 9-14 Minutes ……………………………………………………………………………………… 10-1 Table 10.1 Interstate Switched Access Minutes …………………………………………………… 10-3 Chart 10.1 Interstate Switched Access Minutes …………………………………………………… 10-3 Table 10.2 Telephone Calls and Billed Access Minutes of Large Incumbent LECs Reporting to the Commission ………………………………………………………… 10-4 Mobile Wireless Service ……………………………………………………………………. 11-1 Table 11.1 Measures of Mobile Wireless Telephone Subscribers……………………………………11-3 Chart 11.1 Mobile Wireless Telephone Subscribers ……………………………………………… 11-4 Table 11.2 Mobile Wireless Telephone Subscribers ……………………………………………… 11-5 Table 11.3 Mobile Wireless Telephone Service: Industry Survey Results ………………………… 11-6 Table 11.4 Distribution of Residential Wireless Calls and Minutes ……………………………… 11-7 Table 11.5 Duration of Residential Wireless Calls: 2005 ………………………………………… 11-8 Table 11.6 Distribution of Residential Intrastate Wireless Minutes by Day and Time: 2005 ………11-9 Table 11.7 Distribution of Residential Interstate Wireless Minutes by Day and Time: 2005 ………11-10 iii Price Indices for Telephone Services …………………………………………………………12-1 Table 12.1 Long-Term Changes for Various Price Indices (Annual Rates of Change) …………… 12-3 Chart 12.1 CPI All Items and CPI Telephone Services …………………………………………… 12-3 Table 12.2 Annual Changes in Major Price Indices ………………………………………………… 12-4 Chart 12.2 Percent Change in CPI All Items and CPI Telephone Services ………………………… 12-4 Table 12.3 Annual Changes in Price Indices for Local and Long Distance Telephone Services ……12-5 Chart 12.3 CPI Telephone Service Price Indices …………………………………………………… 12-5 Price Levels ……………………………………………………………………………………13-1 Table 13.1 Average Residential Rates for Local Service in Urban Areas: 1986 - 2005 …………… 13-3 Table 13.2 Average Local Rates for Business with a Single Line In Urban Areas: 1989 - 2005 …… 13-4 Table 13.3 Average Rate for a Residential Access Line …………………………………………… 13-5 Table 13.4 Average Revenue Per Minute …………………………………………………………… 13-6 Chart 13.1 Revenue Per Minute for Interstate Calls ……………………………………………….. 13-7 Residential Wireline Usage ………………………………………………………………… 14-1 Table 14.1 Distribution of Residential Wireline Toll Calls and Minutes ..………………………… 14-3 Table 14.2 Average Residential Wireline Monthly Toll Minutes ……………………………………14-3 Table 14.3 Distribution of Residential Wireline Long Distance Call Durations: 2005 ….………… 14-4 Table 14.4 Duration and Distance of Interstate Toll Calls ………………………………………… 14-5 Table 14.5 Duration and Distance of Intrastate Toll Calls ………………………….……………… 14-5 Table 14.6 Distribution of Residential Wireline Long Distance Minutes By Day and Time…………14-6 Revenues ……………………………………………………………………………………… 15-1 Table 15.1 Telecommunications Industry Revenues …………………………………………………15-3 Chart 15.1 End-User Telecommunications Revenues ……………………………………………… 15-3 Table 15.2 Telecommunications Revenues Reported by Type of Service ………………...…………15-4 Table 15.3 Number of Interstate Telecommunications Providers By Principal Type of Business … 15-5 Table 15.4 Gross Revenues Reported by Type of Carrier ……………………………………………15-6 Table 15.5 Total Telecommunications Revenues by State ………………………………………… 15-7 Table 15.6 Telecommunications Revenues by State: 2004 ………………………………………… 15-8 Table 15.7 Telecommunications Revenues by Type of Service: 2004 ...…………………………… 15-9 Subscribership ………………………………………………………………………………. 16-1 Table 16.1 Household Telephone Subscribership in the United States ……………………………… 16-3 Table 16.2 Historical Telephone Penetration Estimates …………………………………………… 16-4 Table 16.3 Telephone Penetration by State: Households with Telephone Service ……...……………16-5 Table 16.4 Telephone Penetration by State: Houseing Units with Telephone Service ……...……… 16-6 Table 16.5 Telephone Penetration by Selected Characteristics ………………………………………16-7 iv Technology Development ……………………………………………………………………… 17-1 Table 17.1 Central Office Switches and Access Lines by Technology …………………………… 17-5 Table 17.2 Switches by Metropolitan Statistical Area (MSA) and Non-MSA and Switches by Line Counts ……………………………………………………………………………. 17-6 Table 17.3 Local Transmission Technology (Bell Operating Companies) and Working Telecommunications Channels ……………………………………………… 17-7 Table 17.4 Central Offices Converted to Equal Access (As of May 1, 2006) …………….………… 17-8 Table 17.5 Broadband Capabilities of NECA's 2006 Rural Incumbent LEC Survey Respondents … 17-9 Chart 17.1 Telecommunications Patents …………………..…………………………..……………17-10 Table 17.6 Capital Expenditures for Structures and Equipment ……………………………………17-11 Chart 17.2 Capital Expenditures for Structures and Equipment by Carriers ……………..…………17-12 Telephone Numbers ………………………………………………………………………………18-1 Table 18.1 Area Codes by State …………………………………………………………………… 18-3 Table 18.2 Area Code Assignments ………………………………………………………………… 18-4 Table 18.3 Telephone Numbers Assigned for Toll-Free Service (800,888,877,866) ……………… 18-6 Chart 18.1 Working Toll-Free Numbers .…………………………………………………………. 18-6 Table 18.4 Telephone Numbers Assigned for Toll-Free Service 800 Toll-Free Service ………...… 18-7 Table 18.5 Telephone Numbers Assigned for 888 Toll-Free Service ……………………………… 18-8 Table 18.6 Telephone Numbers Assigned for 877 Toll-Free Service ……………………………… 18-9 Table 18.7 Telephone Numbers Assigned for 866 Toll-Free Service ………………………………18-10 Table 18.8 Number of Digits Necessary to Dial Local and Toll Calls in the U.S. …………………18-11 Universal Service ……………………………………………………………………………….. 19-1 Table 19.1 Universal Service Support Mechanisms: 2005 ………………………………………… 19-5 Chart 19.1 Distribution of Universal Service Payments: 2005 ………………………………………19-5 Table 19.2 Universal Service Support Received by Service Provider: 2005 …………………………19-6 Chart 19.2 Universal Service Support Received by Service Provider: 2005 ……………………… 19-6 Table 19.3 High-Cost Support Fund Payment History ………………………………………………19-7 Chart 19.3 Total High-Cost Support Fund Payments ..………………………………………………19-7 Table 19.4 High-Cost Support Fund Payments by State: 2005……………………………………… 19-8 Table 19.5 High-Cost Support Received by Incumbent LECs and CETCs ……………………...… 19-9 Chart 19.4 Percent of High-Cost Support Received by CETCs …………………………………… 19-9 Table 19.6 High-Cost Support by Type of Carriers: 2005 ………………………………………… 19-10 Table 19.7 Lifeline Monthly Support by State or Jurisdiction ………………………………………19-11 Table 19.8 Lifeline Subscribers and Link-Up Beneficiaries …….………………………………… 19-12 Table 19.9 Lifeline Subscribers and Link-Up Beneficiaries by State: 2005 …………………………19-13 Table 19.10 Low-Income Support Payments …………………………………………………………19-14 Chart 19.5 Lifeline and Link-Up Support Payments ……………………………………………… 19-14 Table 19.11 Low-Income Support Payments by State: 2005 …………………………………….……19-15 Table 19.12 Low-Income Support Received by Incumbent LECs and CETCs …………..………..…19-16 Chart 19.6 Percent of Low-Income Support Received by CETCs ….………………………………19-16 v Table 19.13 Schools and Libraries Funding by Type of Service …………………………………… 19-17 Chart 19.7 Total Schools and Ldibraries Funds Committed and Disbursed ……………….……… 19-17 Table 19.14 Schools and Libraries Funding by State and Type of Service …….…………………… 19-18 Table 19.15 Rural Health Care Fund Disbursements by Service Speed ………………………………19-19 Chart 19.8 Rural Health Care Fund Disbursements by Service Speed ………………………………19-19 Table 19.16 Rural Health Care Fund Disbursements by Service Speed and by State ……………… 19-20 Table 19.17 Universal Service Fund Contribution Factors …………………….…………………… 19-21 Table 19.18 Share of Universal Service Contributions by Principal Type of Contributor Using Traditional Carrier Categories …………………………………………………… 19-22 Chart 19.9 Share of Universal Service Contributions by Principal Type of Contributor …………… 19-22 Appendix A - List of Publications by the Industry Analysis and Technology Division ……… 20-A Appendix B - Sources of Telecommunications Information …………………………………… 21-A Appendix C - Contacting the Report Authors ………………………………………………… 22-A vi 1 - 1 Introduction Trends in Telephone Service is published by the Industry Analysis and Technology Division of the Federal Communication Commission’s Wireline Competition Bureau. 1 This report is designed to provide answers to some of the most frequently asked questions about the telephone industry -- questions asked by consumers, members of Congress, other government agencies, telecommunications carriers, and members of the business and academic communities. To this end, the report contains summary information about the size, growth, and development of the telephone industry, including data on market shares, minutes of calling, number of lines, and telephone subscribership. The report also provides information about access charges, advanced telecommunications, consumer expenditures for service, infrastructure, international telephone traffic, local telephone competition, telephone rates and price changes, toll service providers, and universal service support. Trends in Telephone Service summarizes a variety of information contained in other reports that are published periodically by the Industry Analysis and Technology Division. 2 In most cases, these other reports provide more detailed information than that provided here. These reports can be accessed from the Wireline Competition Bureau Statistical Reports Internet site, at www.fcc.gov/wcb/stats. In addition, to facilitate further information gathering by consumers and others, we have listed additional sources of information in Appendix B, and we have provided information on contacting the authors of this report in Appendix C. 1 Access Charges Long distance companies rely on the loops, switches, and transport facilities of local telephone companies for access to their customers. As a result, local telephone companies recover a portion of their costs from long distance companies accessing their networks. Both the manner in which these access charges have been assessed and the proportion of the costs they have recovered have varied considerably over time. In the early 1980s, AT&T provided about three-quarters of the nation's local telephone service and almost all interstate long distance service. Because revenue sharing was largely an internal process for AT&T, it was able to charge prices above true economic cost for long distance calls and share the revenues with local telephone companies. These transfers, while reducing the pressures on the local companies to raise monthly rates, contributed to inefficiently high long distance rates. The high rates were responsible for suppressing demand for long distance calls and inducing large corporations to bypass the public switched network. Moreover, while such revenue sharing arrangements were sustainable in an industry where one firm monopolized both long distance and local service, they were not compatible with a competitive 1 Trends in Telephone Service was last published in June 2005. 2 See Appendix A for a list of these publications. 1 - 2 long distance industry. In mid-1984 the FCC, in cooperation with a Federal-State Joint Board composed of both federal and state regulators, introduced sweeping changes in the way that local telephone companies charged for their services. The historic method of sharing revenues was replaced with a new system of access charges that provided a uniform method for local telephone companies to charge long distance carriers for the origination and termination of interstate traffic on their local networks. In addition, monthly subscriber line charges (SLCs) were introduced to recover a portion of the fixed costs of the local telephone companies’ loops directly from end users on a per-line basis. Since local telephone companies were required to reduce their charges to long distance carriers -- dollar for dollar -- as SLCs were introduced, the pricing changes reduced the implicit subsidy from long distance use to local service. The rebalancing of prices between local service and interstate long distance calls during the 1980s had a fundamental impact on the telephone industry as the price of long distance service fell and the volume of long distance calling surged. In mid-1997, as part of its implementation of the 1996 Telecommunications Act, the FCC introduced further interstate access charge reform. Prior to the 1997 reform, local carriers continued to recover part of their fixed costs in per-minute charges (from long distance carriers) and part from end users (in SLCs.) Presubscribed interexchange carrier charges (PICCs) were created in order to allow local carriers to recover the remaining portion of their fixed loop costs from long distance carriers on a per-line, instead of a per-minute, basis. As part of access charge reform in May of 2000, the FCC started to eliminate PICCs and consolidate them with SLCs. All price-cap local exchange carriers implemented lower access charges paid by long distance carriers. In October of 2001, the FCC modified its interstate access charge rules for rate-of-return incumbent local exchange carriers. These changes for the rate-of-return carriers were designed to align the interstate access rate structure more closely with the manner in which costs are incurred by driving per-minute access charges towards lower, more cost-based levels. Average monthly SLCs and PICCs are shown in Table 1.1, and average per-minute rates charged to long distance carriers are shown in Table 1.2. Both tables report historical averages for all local exchange carriers (LECs) that file access tariffs subject to price-cap regulation and all LECs in the National Exchange Carrier Association (NECA) pool. Current per-line charges and per-minute charges are reported for each of the carriers in Tables 1.3 and 1.4, respectively. Table 1.1 Residential and Non-Primary Multiline Non-Primary Multiline From To Single-Line Residential Business Residential Business Business and Centrex 05/26/84 05/31/85 $0.00 $4.99 06/01/85 09/30/85 1.00 4.99 10/01/85 05/31/86 1.00 4.97 06/01/86 12/31/86 2.00 4.97 01/01/87 06/30/87 2.00 5.12 07/01/87 12/31/87 2.60 5.12 01/01/88 11/30/88 2.60 5.01 12/01/88 03/31/89 3.20 5.01 04/01/89 12/31/89 3.50 4.94 01/01/90 06/30/90 3.48 4.84 07/01/90 12/31/90 3.48 4.83 01/01/91 06/30/91 3.48 4.77 07/01/91 11/27/91 3.49 4.74 11/28/91 06/30/92 3.49 4.76 07/01/92 06/30/93 3.49 4.68 07/01/93 06/30/94 3.50 5.37 07/01/94 06/30/95 3.50 5.45 07/01/95 06/30/96 3.50 5.50 07/01/96 06/30/97 3.50 5.53 07/01/97 12/31/97 3.50 5.68 01/01/98 06/30/98 3.50 $4.98 6.92 $0.49 $1.50 $2.52 $0.35 07/01/98 12/31/98 3.50 4.99 7.11 0.49 1.38 2.38 0.38 01/01/99 06/30/99 3.50 5.88 7.05 0.49 1.38 2.22 0.32 07/01/99 12/31/99 3.50 5.84 6.94 0.95 1.77 2.78 0.42 01/01/00 06/30/00 3.50 5.81 6.94 0.92 1.70 2.44 0.35 08/11/00 06/30/01 4 4.28 5.99 6.88 0.00 0.00 2.30 0.37 07/01/01 12/31/01 4.78 6.66 0.00 0.00 1.35 0.22 01/01/02 06/30/02 4.92 6.79 0.00 0.00 1.35 0.22 07/01/02 06/30/03 5.62 6.45 0.00 0.00 0.48 0.08 07/01/03 06/30/04 5.96 6.37 0.00 0.00 0.20 0.04 07/01/04 06/30/05 5.92 6.24 0.00 0.00 0.19 0.05 07/01/05 06/30/06 5.92 6.26 0.00 0.00 0.21 0.04 07/01/06 06/30/07 5.91 6.27 0.00 0.00 0.23 0.04 Source: Access tariff filings. 4 Although the charges took effect on July 1, 2000, some companies made adjustments to the tariffs which did not take effect until August 11, 2000. 2 Prior to 1/01/98, carriers did not charge separate subscriber line charge (SLC) rates for primary and non-primary residential lines. Therefore, the residential and single-line business average SLCs reported prior to 1/01/98 include all residential SLC charges. The average residential and single- line business SLC rate as of 1/01/98 excludes non-primary residential SLCs. Non-primary SLCs are now reported separately, except for the LECs in the NECA pool, which continue to charge a single residential SLC. Under price-cap regulation, as of July 1, 2003, the caps on SLCs for primary residential and single-line business, non-primary residential, and multiline business and Centrex lines equal $6.50, $7.00, and $9.20, respectively. For NECA pool companies, the residential SLC cap is $6.50, while the multiline business and Centrex SLC cap equals $9.20. 3 On 1/01/98, price-cap carriers began to charge presubscribed interexchange carrier charges (PICCs). The reported PICCs are averages per line including both price-cap and NECA pool lines. While carriers did not charge different rates for Centrex and multiline business SLCs, they did charge different PICC rates for these lines. Therefore, the average multiline business and Centrex PICC rates are reported separately. However, multiline business line counts, used to compute average PICC rates, include Centrex lines for LECs in the NECA pool, which do not charge PICCs or distinguish in access filings between the two line types. On 7/01/00, price-cap carriers stopped charging residential and single-line business PICCs. Therefore, under price-cap regulation, as of July 1, 2000, the caps on PICCs for multiline business lines equal $4.31. Centrex groups of 9 or fewer lines are capped at the multiline business PICC rate of $4.31 per group. Centrex groups with more than 9 lines are capped at $0.48 per line (1/9th the multiline business rate). Interstate Per-Line Access Charges (National Average per Month per Line) 1 Rates in Effect 1 This table shows average rates (weighted by access lines) for all local exchange carriers (LECs) that file access tariffs subject to price-cap regulation and all LECs in the National Exchange Carrier Association (NECA) pool. Residential and Single-Line Business Centrex Charged to Long Distance Carriers 3 (Presubscribed Interexchange Carrier Charges)(Subscriber Line Charges) 5.81 5.93 5.93 Charged to End Users 2 5.88 5.94 5.85 5.83 1 - 3 Table 1.2 Interstate Per-Minute Access Charges (National Average in Cents per Minute) 1 Total Charge per Conversation Minute 3 05/26/84 01/14/85 5.24 ข 5.24 ข 3.10 ข 17.26 ข 01/15/85 05/31/85 5.43 5.43 3.10 17.66 06/01/85 09/30/85 4.71 4.71 3.10 16.17 10/01/85 05/31/86 4.33 4.33 3.10 15.38 06/01/86 12/31/86 3.04 4.33 3.10 14.00 01/01/87 06/30/87 1.55 4.33 3.10 12.41 07/01/87 12/31/87 0.69 4.33 3.10 11.49 01/01/88 11/30/88 0.00 4.14 3.10 10.56 12/01/88 02/14/89 0.00 3.39 3.00 9.60 02/15/89 03/31/89 0.00 3.25 3.00 9.46 04/01/89 12/31/89 1.00 1.83 3.00 9.11 01/01/90 06/30/90 1.00 1.53 2.50 7.78 07/01/90 12/31/90 1.00 1.23 2.50 7.48 01/01/91 06/30/91 1.00 1.14 2.40 7.18 07/01/91 06/30/92 0.88 1.06 2.40 6.97 07/01/92 06/30/93 0.79 0.95 2.40 6.76 07/01/93 06/30/94 0.88 1.16 2.20 6.66 07/01/94 06/30/95 0.84 1.08 2.10 0.28 ข 6.89 07/01/95 06/30/96 0.74 0.89 1.96 0.21 6.16 07/01/96 06/30/97 0.72 0.89 1.95 0.17 6.04 07/01/97 12/31/97 0.64 0.84 1.63 0.14 5.18 01/01/98 06/30/98 0.68 0.23 1.29 0.21 4.04 07/01/98 12/31/98 0.91 0.20 0.99 0.30 3.82 01/01/99 06/30/99 0.82 0.16 0.98 0.32 3.71 07/01/99 12/31/99 0.37 0.10 0.86 0.28 2.82 01/01/00 06/30/00 0.32 0.10 0.86 0.31 2.85 08/11/00 06/31/00 4 0.23 0.07 0.52 0.26 1.91 07/01/01 12/31/01 0.15 0.07 0.48 0.24 1.71 01/01/02 06/30/02 0.15 0.07 0.47 0.24 1.69 07/01/02 06/30/03 0.02 0.01 0.48 0.22 1.46 07/01/03 06/30/04 0.00 0.00 0.48 0.22 1.44 07/01/04 06/30/05 0.00 0.00 0.50 0.25 1.53 07/01/05 06/30/06 0.00 0.00 0.52 0.25 1.59 07/01/06 06/30/07 0.01 0.00 0.54 0.25 1.63 Source: Access tariff filings. 4 Although the charges took effect on July 1, 2000, some companies made adjustments to the tariffs which did not take effect until August 11, 2000. 1 This table shows average rates (weighted by minutes of use) for all local exchange carriers (LECs) that file access tariffs subject to price- cap regulation and all LECs in the National Exchange Carrier Association (NECA) pool. The average rates reported here do not include the average revenue per minute from subscriber line charges (SLCs) or primary interexchange carrier charges (PICCs), both of which are reported in Table 1.1. Effective 07/01/03, the carrier common line (CCL) rates for NECA carriers were eliminated. 2 Non-traffic-sensitive charges include charges assessed on a per-month, per-unit basis. Prior to 07/01/94, these charges were included in the average traffic-sensitive rates. 3 The total charge per conversation minute consists of charges on the originating end of the call, which are adjusted for dialing and call setup time, plus charges on the terminating end. Originating charges per conversation minute equal the carrier common line charge per originating access minute plus the traffic-sensitive charge per switched minute, both multiplied by 1.07 to account for dialing and call setup time, plus the non-traffic-sensitive charge per switched minute. Terminating charges per conversation minute equal carrier common line charges per terminating access minute plus both traffic-sensitive and non-traffic-sensitive charges per switched minute. Minute 1 Carrier Common Line per Terminating Access Minute 1 Carrier Common Line per Originating Access Minute 2 Traffic Sensitive per Switched Minute Non-Traffic Rates in Effect From To Sensitive per Switched Interstate Charges for Switched Access Service 1 - 4 Table 1.3 Interstate Per-Line Access Charges by Carrier (In Dollars per Month per Line) 1 Rates Effective from 07/01/06 to 06/30/07 Subscriber Line Charges Presubscribed Interexchange Carrier Charges 2005 Average Monthly Access Lines 2 (Thousands) Company Residential Non-Primary Multiline Residential Non-Primary Multiline Centrex Residential Non-Primary Multiline and Residential Business and Residential Business and Residential Business Single-Line and Single-Line Single-Line and Business Centrex Business Business Centrex ALLTEL (KY & NE) $6.05 $6.42 $7.85 $0.00 $0.00 $1.72 $0.82 513 19 225 BellSouth 6.50 6.76 6.76 0.00 0.00 0.00 0.00 12,105 1,321 4,846 CenturyTel 3 6.37 6.56 7.51 0.00 0.00 0.83 1.18 448 27 115 Cincinnati Bell 5.24 5.24 5.24 0.00 0.00 0.00 0.00 609 49 258 Citizens 6.13 6.44 9.20 0.00 0.00 4.31 0.75 1,570 105 422 Hawaiian Telecom 6.50 7.00 8.15 0.00 0.00 0.00 0.00 374 53 205 Iowa Telecom 6.14 6.14 8.79 0.00 0.00 0.00 0.00 186 9 42 Qwest 6.01 6.23 6.50 0.00 0.00 0.00 0.00 8,327 1,041 3,030 SBC 4.96 4.83 4.89 0.00 0.00 0.00 0.00 24,610 3,952 14,236 Sprint 5.74 5.67 7.15 0.00 0.00 0.00 0.00 5,032 520 1,563 Valor 6.50 7.00 9.20 0.00 0.00 2.08 1.51 350 47 82 Verizon 6.30 6.32 6.79 0.00 0.00 0.52 0.07 26,396 3,948 13,077 Price Caps 5.84 5.81 6.11 0.00 0.00 0.24 0.04 80,520 11,092 38,101 NECA 6.50 NA 9.20 0.00 NA 0.00 NA 9,604 NA 2,071 Price Caps and NECA 5.91 5.81 6.27 0.00 0.00 0.23 0.04 90,124 11,092 40,172 NA - Not Available. 3 Data reflect only those company study areas subject to price-cap regulation. Source: Access tariff filings. 2 Access line counts measure lines that companies report as qualified to receive subscriber line charges (SLCs). ISDN-BRI lines, which are charged non-primary SLC and PICC rates, are included in the non-primary residential line counts. ISDN-PRI lines, which are charged rates equal to five times the multiline business SLC and PICC rates, are multiplied by five and added to multiline business counts. 1 This table shows average rates (weighted by access lines) for all local exchange carriers (LECs) that file access tariffs subject to price-cap regulation and all LECs in the National Exchange Carrier Association (NECA) pool. Rates are composites of all regions and subsidiaries of each local exchange carrier. No information is available for those carriers that are not in the NECA pool, but are subject to rate-of-return regulation. 1 - 5 Table 1.4 Interstate Per-Minute Access Charges by Carrier (In Cents per Minute) 1 Rates Effective from 7/1/06-06/30/07 Year 2005 Minutes of Use Carrier (Millions) Common Line per Company Originating Access Local Minute 2 Originating Terminating Switching ALLTEL (KY & NE) 0.00 ข 0.00 ข 0.55 ข 0.31 ข 1.75 ข 596 938 2,083 BellSouth 0.00 0.00 0.43 0.33 1.54 20,492 66,617 57,115 CenturyTel 5 0.16 0.00 0.51 0.31 1.86 409 1,488 1,897 Cincinnati Bell 0.00 0.00 0.58 0.37 1.94 651 2,097 2,750 Citizens 0.15 0.00 0.50 0.45 2.10 1,304 4,744 6,049 Hawaiian Telecom 0.00 0.00 0.82 0.15 1.99 365 1,071 1,525 Iowa Telecom 0.00 0.00 1.55 0.66 4.53 297 349 647 Qwest 0.00 0.00 0.68 0.16 1.72 14,059 26,119 40,322 SBC 0.00 0.00 0.45 0.21 1.34 50,453 51,797 109,030 Sprint 0.00 0.00 0.73 0.15 1.81 5,197 20,146 22,856 Valor 0.00 0.00 0.78 0.35 2.33 278 902 1,180 Verizon 0.02 0.00 0.49 0.22 1.46 32,581 88,440 121,861 Price Caps 0.01 0.00 0.51 0.23 1.51 126,682 264,709 367,313 NECA 0.00 0.00 1.13 0.72 3.78 * * 19,340 All Price Caps and NECA 0.01 0.00 0.54 0.25 1.63 * * 386,654 * NECA no longer files information regarding originating and terminating Carrier Common Line (CCL) charges. 5 Data reflect only those company study areas subject to price-cap regulation. Source: Access tariff filings. Carrier Common Line 2 Effective 07/01/03, the carrier common line (CCL) rates for NECA carriers were eliminated. 3 Non-traffic sensitive charges include charges assessed on a per-month, per-unit basis. Prior to 07/01/94 these charges were included in the average traffic-sensitive rates. Access Minute 3 Access Minute 2 1 This table shows average rates (weighted by minutes of use) for all local exchange carriers (LECs) that file access tariffs subject to price-cap regulation and all LECs in the National Exchange Carrier Association (NECA) pool. Rates are composites of all regions and subsidiaries of each local exchange carrier. No information is available for those carriers that are not in the NECA pool, but are subject to rate-of-return regulation. The average rates reported here do not include the average revenue per minute from subscriber line charges (SLCs) or primary interexchange carrier charges (PICCs), both of which are reported in Table 1.1. Access Minute Conversation Minute 4 Non-Traffic Sensitive per Total Charge per 4 The total charge per conversation minute consists of charges on the originating end of the call, which are adjusted for dialing and call setup time, plus charges on the terminating end. Originating charges per conversation minute equal the carrier common line charge per originating access minute plus the traffic-sensitive charge per switched minute, both multiplied by 1.07 to account for dialing and call setup time, plus the non-traffic- sensitive charge per switched minute. Terminating charges per conversation minute equal carrier common line charges per terminating access minute plus both traffic-sensitive and non-traffic-sensitive charges per switched minute. Switched Traffic Sensitive per Carrier Common Line per Terminating Switched 1 - 6 2 - 1 2 Advanced Telecommunications Congress directed the Commission and the states, in section 706 of the Telecommunications Act of 1996, to encourage deployment of advanced telecommunications capability in the United States on a reasonable and timely basis. To assist in its evaluation of such deployment, the Commission instituted a formal data collection program to gather standardized information about subscribership to high-speed services, including advanced services, from wireline telephone companies, cable system operators, terrestrial wireless service providers, satellite service providers, and any other facilities-based providers of advanced telecommunications capability. For reporting purposes, high-speed service “lines” are wired or wireless connections to end users (i.e., to Internet-access service subscribers) that are faster than 200 kilobits per second (kbps) in at least one direction. Advanced services lines are faster than 200 kbps in both directions (and are therefore a subset of high-speed lines). All facilities-based providers of high-speed lines were required to report to the Commission basic information about their service offerings and types of customers as of June 30, 2005. Previously collected data (i.e., as of December 31, 1999 and each succeeding June 30 and December 31 through the end of 2004) were reported by facilities-based providers with at least 250 high-speed lines in service in a particular state, and by a few smaller entities that filed on a voluntary basis. 1 Small providers, many of whom serve rural areas with relatively small populations, were therefore underrepresented in the earlier data. More than twice as many holding companies and unaffiliated entities reported information about high-speed lines in June 2005 as had reported six months earlier. Starting with the June 30, 2005 data, all facilities-based providers report added detail about line speeds. And two groups of providers – incumbent local exchange carriers (LECs) and cable system operators – report the extent to which their high-speed lines are available to the households to whom they offer local telephone service or cable TV service (i.e., available whether or not the household actually subscribes to a high-speed Internet-access service). Table 2.1 shows high-speed lines for the following types of technology: asymmetric digital subscriber line (ADSL), symmetric digital subscriber line (SDSL), traditional wireline, cable modem, fiber, satellite, fixed wireless, mobile wireless, and power line and other. Chart 2.1 shows the growth of high-speed lines from June 2000 through June 2006, and Chart 2.2 shows the proportion of high-speed lines by technology as of June 30, 2006. Table 2.2 shows advanced services lines by the above technologies. Chart 2.3 shows the growth of advanced services lines from June 2000 through June 2006, and Chart 2.4 shows the proportion of advanced services lines by technology as of June 30, 2006. 1 High-speed lines reported in earlier voluntary submissions represented less than 0.05% of total reported high- speed lines. As of June 30, 2005, filers with fewer than 250 lines in a state (including entities that previously filed on a voluntary basis) represented about 0.2% of total reported high-speed lines. 2 - 2 Comparable data for residential lines, only, are shown in Table 2.3 and Table 2.4, and in Charts 2.5 through 2.8. Table 2.5 and Chart 2.9 provide additional detail about speeds (i.e., information transfer rates) of reported high-speed lines, by technology. Table 2.6 shows high-speed lines, by state and by technology, as of June 30, 2006. Table 2.7 shows total reported high-speed lines by state over time. Table 2.8 provides nationwide and state-specific estimates of the extent to which digital subscriber line (DSL) high-speed lines provided by incumbent LECs, and cable modem high- speed service provided by cable system operators, are available to the households to whom these companies offer local telephone service or cable TV service. The U.S. Department of Commerce periodically has asked the U.S. Census Bureau to include questions on whether households have telephones, computers, and Internet access as part of the Current Population Survey. Chart 2.10 shows the percent of U.S. households with computers, Internet access, and high-speed access. The chart presents summary statistics from the most recent (sixth) report based on these data, A Nation Online: Entering the Broadband Age, which is available through the National Telecommunications and Information Administration (NTIA) web site at www.ntia.doc.gov. Table 2.9 and Chart 2.11 show the percent of U.S. households with Internet Connections for rural and urban areas. 2003 2006 Jun ADSL 951,583 2,693,834 5,101,493 7,675,114 11,398,199 13,817,280 16,316,309 19,515,619 22,575,010 SDSL and Traditional Wireline 758,594 1,088,066 1,186,680 1,215,713 1,407,121 1,468,566 898,468 904,539 948,160 SDSL ------411,731 394,348 337,438 Traditional Wireline 486,737 510,191 610,722 Cable Modem 2,284,491 5,184,141 9,172,895 13,684,225 18,592,636 21,357,400 23,936,536 26,469,242 28,513,500 Fiber 3 46,635 81,248 105,991 111,386 130,928 159,653 315,651 448,257 700,083 Satellite and Wireless 65,615 194,707 220,588 309,006 421,690 549,621 965,068 3,814,122 11,872,309 Satellite ------376,837 426,928 495,365 Fixed Wireless 208,695 257,431 360,976 Mobile Wireless ------379,536 3,129,763 11,015,968 Power Line and Other 4,872 4,571 5,208 Total Lines 4,106,918 9,241,996 15,787,647 22,995,444 31,950,574 37,352,520 42,436,904 51,156,350 64,614,270 For data through December 2004, only those providers with at least 250 lines per state were required to file. Some data have been revised. See additional notes following Chart 2.9. Technology 2 2000 Table 2.1 (Over 200 kbps in at least one direction) High-Speed Lines 1 2001 2002 Jun Chart 2.2 Total High-Speed Lines Chart 2.1 High-Speed Lines by Technology as of June 30, 2006 Jun Jun Jun 2004 JunJun Dec 2005 Dec 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 70,000,000 Dec 1999 Dec 2000 Jun 2003 Jun 2004 Jun 2005 Jun 2006 Cable Modem 44.1% SDSL and Traditional Wireline 1.5% ADSL 34.9% Fiber 1.1% All Other 18.4% 2 - 3 2003 2006 Jun Jun Jun Jun Jun Dec Jun Dec Jun ADSL 326,816 998,883 1,852,879 2,536,368 3,768,019 5,695,548 13,176,095 15,921,353 18,301,930 SDSL and Traditional Wireline 758,594 1,088,066 1,186,680 1,215,713 1,407,121 1,468,566 869,772 874,263 946,900 SDSL - - - - - - 387,451 368,736 336,612 Traditional Wireline - - - - - - 482,321 505,527 610,288 Cable Modem 1,469,130 3,329,976 6,819,395 11,935,866 17,567,468 20,891,624 22,664,106 26,200,400 28,220,563 Fiber 3 40,627 81,204 104,015 110,829 129,636 157,127 314,229 447,244 698,990 Satellite and Wireless 3,649 73,476 66,073 64,393 93,805 106,616 223,274 340,110 2,274,465 Satellite - - - - - - 10,966 36,331 27,489 Fixed Wireless - - - - - - 191,229 220,276 333,072 Mobile Wireless - - - - - - 21,079 83,503 1,913,904 Power Line and Other - - - - - - 4,174 4,501 5,208 Total Lines 2,598,816 5,571,605 10,029,042 15,863,169 22,966,048 28,319,482 37,251,651 43,787,871 50,448,057 For data through December 2004, only those providers with at least 250 lines per state were required to file. Some data have been revised. See additional notes following Chart 2.9. Advanced Services Lines by Technology as of June 30, 2006 Technology 2 Total High-Speed Lines Chart 2.4 2002 2005 Advanced Services Lines 1 Table 2.2 Advanced Services Lines Chart 2.3 2004 (Over 200 kbps in both directions) 2000 2001 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 Dec 1999 Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005 Cable Modem 55.9% SDSL and Traditional Wireline 1.9% ADSL 36.3% Fiber 1.4% All Other 4.5% 2 - 4 2003 2006 Jun Jun Jun Jun Jun Dec Jun Dec Jun ADSL 772,272 2,490,740 4,395,033 6,429,938 10,759,495 13,119,326 14,442,823 17,370,536 20,143,255 SDSL and Traditional Wireline 111,490 138,307 223,599 250,372 393,049 419,215 159,489 129,439 112,043 SDSL - - - - - - 153,978 122,215 102,631 Traditional Wireline - - - - - - 5,511 7,224 9,412 Cable Modem 2,215,259 4,998,540 9,157,285 13,660,541 18,525,265 21,270,158 23,497,069 25,625,191 27,720,407 Fiber 3 325 2,623 6,120 16,132 22,719 34,959 83,293 213,484 442,027 Satellite and Wireless 64,320 182,165 202,251 288,786 387,563 422,623 428,367 533,480 1,839,368 Satellite - - - - - - 265,017 320,149 382,047 Fixed Wireless - - - - - - 160,775 203,188 301,153 Mobile Wireless - - - - - - 2,574 10,143 1,156,168 Power Line and Other - - - - - - 4,447 4,550 5,093 Total Lines 3,163,666 7,812,375 13,984,287 20,645,769 30,088,091 35,266,281 38,615,489 43,876,680 50,262,193 For data through December 2004, only those providers with at least 250 lines per state were required to file. Small business lines were included in totals through December 2004. Some data have been revised. See additional notes following Chart 2.9. Residential High-Speed Lines by Technology as of June 30, 2006 Chart 2.5 Chart 2.6 Residential High-Speed Lines 20052004 Residential High-Speed Lines 1 Table 2.3 (Over 200 kbps in at least one direction) Technology 2 2000 2001 2002 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 60,000,000 Dec 1999 Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005 SDSL and Traditional Wireline 0.2% ADSL 40.1% Fiber 0.9% Cable Modem 55.2% All Other 3.7% 2 - 5 2003 2006 ADSL 195,324 916,364 1,580,575 2,071,779 3,174,022 5,026,367 11,731,303 14,242,318 16,407,705 SDSL and Traditional Wireline 111,490 138,307 223,599 250,372 393,049 419,215 151,979 125,110 111,961 SDSL - - - - - - 149,862 122,215 102,606 Traditional Wireline - - - - - - 2,118 2,895 9,355 Cable Modem 1,401,434 3,146,953 6,809,170 11,920,207 17,505,907 20,811,704 22,243,481 25,444,150 27,479,801 Fiber 3 325 2,617 5,118 15,751 21,866 33,189 82,831 212,865 441,128 Satellite and Wireless 2,916 60,988 47,787 46,407 72,485 84,465 150,893 205,470 1,448,607 Satellite - - - - - - 2,244 25,118 15,055 Fixed Wireless - - - - - - 146,074 170,522 277,384 Mobile Wireless - - - - - - 2,574 9,830 1,156,168 Power Line and Other - - - - - - 3,916 4,481 5,093 Total Lines 1,711,488 4,265,229 8,666,249 14,304,515 21,167,329 26,374,940 34,364,403 40,234,394 45,894,295 For data through December 2004, only those providers with at least 250 lines per state were required to file. Small business lines were included in totals through December 2004. Some data have been revised. See additional notes following Chart 2.9. Chart 2.8 Jun Residential Advanced Services Lines by Technology as of June 30, 2006 Jun Chart 2.7 Residential Advanced Services Lines Technology 2 2004 Dec Dec 2005 Jun Jun Table 2.4 Residential Advanced Services Lines 1 (Over 200 kbps in both directions) JunJunJun 20022000 2001 0 10,000,000 20,000,000 30,000,000 40,000,000 50,000,000 Dec 1999 Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005 Fiber 1.0% All Other 3.2% SDSL and Traditional Wireline 0.2% ADSL 35.8% Cable Modem 59.9% 2 - 6 ADSL 4,273,080 12,176,742 6,111,807 11,255 * * SDSL 826 327,370 9,223 11 * * Traditional Wireline 434 583,221 10,363 891 12,270 3,543 Cable Modem 292,937 3,053,382 23,039,748 2,099,654 27,779 0 Fiber 3 1,093 221,227 315,266 133,339 15,778 13,380 Satellite 467,876 * * 0 0 0 Fixed Wireless 27,904 313,011 17,220 2,580 207 54 Mobile Wireless 9,102,064 * * 0 0 0 Power Line and Other 0 * * 0 0 0 Total Lines 14,166,213 18,618,973 29,506,209 2,247,730 57,101 18,044 * Data withheld to maintain firm confidentiality. Table 2.5 High-Speed Lines by Information Transfer Rates 1 As of June 30, 2006 Exceeding 200 kbps in both directions, and: Technology 2 Exceeding 200 kbps in only one direction See data have been revised. See additional notes following Chart 2.9. Greater than 200 kbps and less than 2.5 mbps in the faster direction Greater than or equal to 2.5 mbps and less than 10 mbps in the faster direction Chart 2.9 High-Speed Lines by Information Transfer Rates in the Faster Directions as of June 30, 2006 (Includes only lines exceeding 200 kbps in both directions) Greater than or equal to 100 mbps in the faster direction Greater than or equal to 10 mbps and less than 25 mbps in the faster direction Greater than or equal to 25 mbps and less than 100 mbps in the faster direction 36.9% 58.5% 4.6% > than 200 kbps, < than 2.5 mbps ? than 2.5 mbps, < than 10 mbps ? than 10 mbps 2 - 7 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, High-Speed Services for Internet Access: Status as of June 30, 2006 (January 2007). Notes for Tables 2.1 - 2.5 and Charts 2.1 - 2.9. Advanced services lines, residential high-speed lines, and residential advanced services lines are estimated based on data reported on FCC Form 477. Therefore, figures may not add to totals due to rounding. 1 High-speed lines are connections to end-user locations that deliver services at speeds exceeding 200 kbps in at least one direction. Advanced services lines, which are a subset of high-speed lines, are connections that deliver services at speeds exceeding 200 kbps in both directions. In Tables 2.2 and 2.4, we enumerate those reported high-speed lines that also qualify as advanced services lines. More detailed information about connection speeds is presented in Table 2.5. Line counts presented in this report are not adjusted for the number of persons at a single end-user location who have access to, or who use, the Internet-access services that are delivered over the high-speed connection to that location. 2 The mutually exclusive types of technology are, respectively: Asymmetric digital subscriber line (ADSL) technologies, which provide speeds in one direction greater than speeds in the other direction; symmetric digital subscriber line (SDSL) technologies; traditional wireline technologies "other" than ADSL and SDSL, including traditional telephone company high-speed services that provide equivalent functionality, and also Ethernet service if delivered to the subscriber's location over copper (as opposed to optical fiber) plant; cable modem, including the typical hybrid fiber-coax (HFC) architecture of upgraded cable TV systems; optical fiber to the subscriber's premises (e.g., Fiber-to-the-Home, or FTTH); satellite and fixed and mobile terrestrial wireless systems, which use radio spectrum to communicate with a radio transmitter; and electric power line. 3 Fiber line counts included electric power line through December 2004. The June 2005 fiber counts reflect a downward correction by one or more filers. Fiber line counts prior to June 2005 have been adjusted to take into account this downward correction. 2 - 8 Traditional Cable Fixed Mobile Power Line Wireline Modem Wireless Wireless and Other Alabama 268,970 9,409 5,691 310,548 995 * 704 * * 615,510 Alaska 53,687 8,108 358 * * * 4,292 * 0 125,005 American Samoa * * 0 0 0 * * 0 0 * Arizona 276,261 1,741 8,114 761,419 2,272 * 16,964 * 0 1,392,711 Arkansas 180,883 920 2,974 148,940 2,148 * 581 * 0 363,933 California 4,001,529 38,728 161,115 2,956,932 132,473 * 39,329 * 0 9,395,285 Colorado 404,989 2,538 12,928 476,463 1,073 * 11,067 * 0 1,165,853 Connecticut * 4,118 6,588 441,092 2,776 * 0 * 0 1,024,053 Delaware * 307 1,528 * * * 0 * 0 157,648 District of Columbia * 2,898 2,185 * 423 * * * 0 200,221 Florida 1,722,888 8,784 33,858 1,939,409 48,814 * 23,422 * 0 4,408,427 Georgia 1,008,705 8,230 22,043 649,583 1,900 * 503 * 0 2,054,077 Guam * 0 * 0 0 * 0 0 0 * Hawaii * * 2,224 **** * 294,612 Idaho 97,662 480 1,514 75,185 1,078 * 21,915 * 0 202,521 Illinois 1,094,088 14,523 40,916 987,640 * * 19,750 * * 2,611,672 Indiana 443,473 4,649 11,935 490,020 22,187 * 6,296 * * 1,191,752 Iowa 189,267 4,114 2,250 225,545 2,133 * 11,651 * 0 446,657 Kansas 179,430 3,976 4,282 316,866 2,652 * 11,232 * 0 595,979 Kentucky 250,715 4,592 4,014 306,487 1,683 * 1,715 * 0 629,538 Louisiana 235,750 4,762 3,551 378,613 9,843 * 1,143 * 0 730,203 Maine 89,964 3,198 3,484 145,831 * * * * 0 248,440 Maryland 450,019 7,202 11,003 637,405 * * * * 0 1,492,484 Massachusetts * 7,896 11,551 954,812 * * * * 0 1,811,845 Michigan 533,835 4,059 23,377 888,018 12,378 * 2,755 * * 1,786,572 Minnesota 330,736 20,216 4,954 518,063 4,897 * 20,203 * 0 1,057,576 Mississippi 128,585 * 1,824 114,140 448 * * * 0 262,671 Missouri 468,334 4,754 9,871 400,808 4,219 * 5,084 * * 1,016,732 Montana 70,471 2,411 880 54,056 202 * 6,460 * 0 139,946 Nebraska 95,404 2,640 688 218,335 350 * 6,804 * 0 355,013 Nevada 168,086 1,144 7,683 * 1,407 * 3,430 * 0 614,151 New Hampshire 85,247 2,477 2,892 201,873 * * * * 0 302,957 New Jersey 638,293 7,636 17,419 1,312,433 20,032 * * * 0 2,654,674 New Mexico 129,076 544 1,428 100,157 * * 2,160 * 0 250,439 New York 1,001,018 26,755 21,789 2,765,476 54,134 * 464 * 0 4,852,849 North Carolina 561,102 24,545 14,569 650,767 6,670 * 12,917 * 0 1,601,938 North Dakota 38,729 4,282 287 19,861 2,592 * 2,859 * 0 70,615 Northern Mariana Islands * 0 * 0 * * * 0 0 * Ohio 752,633 5,392 18,693 1,115,618 19,046 * 11,669 * * 2,392,030 Oklahoma 246,899 1,937 4,545 284,184 3,816 * 1,947 * 0 569,398 Oregon 280,286 6,686 5,964 407,195 9,444 * 10,129 * 0 860,385 Pennsylvania 871,164 22,253 15,726 1,164,080 42,214 * 1,413 * 0 2,646,898 Puerto Rico * 0 3,406 **** 169,917 Rhode Island * 1,318 1,649 * 1,488 * 0 * 0 276,141 South Carolina 242,548 225 7,402 368,338 3,792 * * * 0 645,886 South Dakota 32,763 3,999 215 37,514 840 * 4,375 * 0 83,275 Tennessee 348,344 2,475 9,293 506,143 5,707 * 150 * 0 1,153,432 Texas 1,733,423 15,471 32,321 1,692,433 104,719 * 51,814 * 0 4,371,655 Utah 189,240 4,378 2,974 * 766 * 8,642 * 0 471,137 Vermont 51,382 1,129 1,864 * * * 409 * 0 108,622 Virgin Islands * * * 0 0 * * * 0 7,226 Virginia 440,990 6,752 17,121 892,955 43,338 * 6,219 * * 1,787,359 Washington 491,409 6,919 10,448 725,832 14,206 * 12,721 * * 1,575,375 West Virginia 86,507 2,832 1,833 145,450 * * * * 0 245,597 Wisconsin 359,530 7,725 15,252 542,881 * * 4,078 * 0 1,034,646 Wyoming 38,541 1,247 164 * 56 * 2,126 * 0 83,086 yg Nationwide 22,575,010 337,438 610,722 28,513,500 700,083 495,365 360,976 11,015,968 5,208 64,614,270 * Data withheld to maintain firm confidentiality. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, High-Speed Services for Internet Access: Status as of June 30, 2006 (January 2007). Table 2.6 High-Speed Lines by Technology as of June 30, 2006 (Over 200 kbps in at least one direction) SDSLADSL Fiber Satellite TotalState 2 - 9 2006 Jun Jun Jun Jun Jun Dec Jun Dec Jun Alabama 32,756 86,234 172,365 283,946 350,691 410,054 455,300 531,976 615,510 Alaska * 20,906 46,791 61,121 88,076 110,416 95,761 109,484 125,005 American Samoa 0 0 0 0 * 0 * * * Arizona 109,867 154,883 305,304 441,227 618,677 745,957 809,819 1,039,553 1,392,711 Arkansas 15,539 40,803 84,061 128,100 188,185 220,051 258,270 302,881 363,933 California 862,835 1,639,921 2,527,275 3,378,373 4,608,822 5,294,566 5,954,876 7,337,831 9,395,285 Colorado 61,408 142,295 238,702 338,083 515,081 615,101 688,189 882,669 1,165,853 Connecticut 61,903 146,266 233,277 364,371 516,039 598,582 679,891 807,796 1,024,053 Delaware 3,242 12,158 35,941 54,272 74,732 91,975 108,554 132,399 157,648 District of Columbia 9,243 28,861 44,266 58,800 83,213 101,638 113,086 139,594 200,221 Florida 234,807 634,703 1,103,236 1,634,552 2,236,963 2,659,862 2,958,350 3,537,720 4,408,427 Georgia 118,630 285,637 494,263 748,016 1,039,440 1,205,282 1,328,956 1,610,750 2,054,077 Guam 0 0 0 0 * * * * * Hawaii * * * * * * * * 294,612 Idaho 8,070 20,233 43,119 64,353 99,845 126,121 149,023 167,926 202,521 Illinois 148,600 325,085 525,817 840,632 1,270,907 1,497,803 1,817,481 2,159,932 2,611,672 Indiana 47,982 77,617 156,375 233,679 515,812 637,696 742,667 922,568 1,191,752 Iowa 49,159 72,583 102,932 162,257 229,811 266,794 325,701 394,359 446,657 Kansas 42,679 101,478 149,415 248,405 322,742 386,747 419,384 470,287 595,979 Kentucky 24,237 39,297 90,284 121,594 300,704 360,903 408,184 508,198 629,538 Louisiana 43,294 121,685 207,257 315,682 420,917 486,077 536,934 508,009 730,203 Maine 17,864 37,888 61,069 85,212 123,739 142,246 176,396 214,599 248,440 Maryland 64,130 171,423 306,504 458,128 655,588 782,757 899,640 1,120,826 1,492,484 Massachusetts 175,243 342,643 566,796 802,423 1,004,229 1,122,230 1,213,640 1,431,925 1,811,845 Michigan 131,692 389,441 531,524 729,113 946,819 1,088,090 1,336,312 1,558,034 1,786,572 Minnesota 62,983 143,819 269,433 394,982 561,411 645,505 716,826 855,753 1,057,576 Mississippi 6,271 21,185 57,168 95,628 139,429 168,393 191,675 219,552 262,671 Missouri 44,924 120,863 220,477 362,040 537,343 584,743 704,273 811,811 1,016,732 Montana * 10,446 17,969 28,023 57,650 72,880 90,583 112,662 139,946 Nebraska 44,188 55,188 92,849 141,172 199,282 216,780 253,968 305,120 355,013 Nevada 40,297 78,076 137,407 209,028 290,518 343,111 401,932 474,019 614,151 New Hampshire 32,774 55,241 85,697 118,304 168,000 215,168 236,817 268,128 302,957 New Jersey 120,549 394,198 654,235 924,835 1,194,557 1,423,698 1,605,301 1,989,803 2,654,674 New Mexico 2,671 20,099 44,462 71,355 115,147 145,125 174,534 204,054 250,439 New York 281,641 811,386 1,364,556 1,891,457 2,349,956 2,688,731 3,067,983 3,660,500 4,852,849 North Carolina 81,998 205,100 461,378 680,828 965,761 1,119,805 1,222,648 1,482,930 1,601,938 North Dakota 2,437 6,277 14,164 25,474 39,274 47,957 56,044 60,871 70,615 Northern Mariana Islands 0 0 0 0 0 0 0 * * Ohio 154,597 354,258 575,756 817,020 1,152,300 1,340,976 1,601,981 1,932,269 2,392,030 Oklahoma 161,601 90,147 148,006 231,106 331,605 387,456 444,777 502,984 569,398 Oregon 43,217 91,457 197,778 316,300 437,040 508,068 558,489 688,487 860,385 Pennsylvania 71,413 249,119 501,950 755,947 1,123,876 1,386,259 1,578,981 1,999,118 2,646,898 Puerto Rico * * * 32,063 43,091 61,554 66,484 118,268 169,917 Rhode Island 19,899 48,258 71,463 104,444 141,981 164,034 185,415 221,901 276,141 South Carolina 32,824 96,839 175,088 262,868 354,877 415,844 464,315 549,019 645,886 South Dakota 3,516 5,448 12,555 22,016 34,026 40,286 61,830 70,721 83,275 Tennessee 87,012 151,706 293,516 413,476 534,597 628,846 682,369 847,025 1,153,432 Texas 252,721 614,704 1,015,245 1,571,250 2,203,490 2,551,963 2,943,487 3,467,705 4,371,655 Utah 18,997 54,005 92,623 133,467 196,590 236,287 259,150 313,854 471,137 Vermont 1,551 16,230 29,990 39,773 56,033 72,400 82,279 95,901 108,622 Virgin Islands * * * * * * 2,183 2,967 7,226 Virginia 64,740 202,663 348,716 553,635 817,881 981,832 1,117,591 1,367,465 1,787,359 Washington 118,723 227,066 422,348 577,378 775,027 889,368 1,000,412 1,220,058 1,575,375 West Virginia 1,835 16,697 58,209 90,173 127,283 155,397 178,323 205,984 245,597 Wisconsin 34,262 127,172 256,735 401,565 564,670 649,091 731,934 859,114 1,034,646 Wyoming * * 10,990 17,507 35,464 45,602 55,905 70,574 83,086 Nationwide 4,106,918 9,241,996 15,787,647 22,995,444 31,950,574 37,352,520 42,436,904 51,156,350 64,614,270 2005 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, High-Speed Services for Internet Access: Status as of June 30, 2006 (January 2007). Table 2.7 High-Speed Lines by State (Over 200 kbps in at least one direction) * Data withheld to maintain firm confidentiality. Some data have been revised. 2003 20042000 2001 2002 State 2 - 10 xDSL Availability Where Cable Modem Availability Where State ILECs Offer Local Telephone Service Cable Systems Offer Cable TV Service Alabama 78% 91% Alaska 78% * American Samoa *0% Arizona 67% 91% Arkansas 66% 77% California 86% 97% Colorado 82% 96% Connecticut * 84% Delaware ** District of Columbia Florida 88% 96% Georgia 87% 89% Guam *0% Hawaii * * Idaho 76% 83% Illinois 78% 97% Indiana 74% 94% Iowa 83% 89% Kansas 80% 86% Kentucky 85% 91% Louisiana 87% 87% Maine 67% 89% Maryland 75% 98% Massachusetts * 99% Michigan 66% 92% Minnesota 81% 91% Mississippi 73% 79% Missouri 72% 96% Montana 76% 83% Nebraska 86% 91% Nevada 85% * New Hampshire 59% 83% New Jersey 88% 100% New Mexico 75% 79% New York 78% 99% North Carolina 83% 95% North Dakota 86% 79% Northern Mariana Islands *0% Ohio 81% 95% Oklahoma 75% 88% Oregon 81% 90% Pennsylvania 82% 94% Puerto Rico * * Rhode Island ** South Carolina 78% 84% South Dakota 76% 58% Tennessee 81% 95% Texas 75% 95% Utah 82% * Vermont 60% * Virgin Islands *0% Virginia 66% 96% Washington 80% 94% West Virginia 68% 88% Wisconsin 76% 96% Wyoming 77% * Nationwide 79% 93% * Data withheld to maintain firm confidentiality. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, High-Speed Services for Internet Access: Status as of June 30, 2006 (January 2007). xDSL includes both asymmetric and symmetric DSL. Each state-specific estimate is a weighted average of the availability percentages that ILECs or cable system operators report for the areas they serve. Reported xDSL availability is weighted by ILEC end-user switched access lines. Reported cable modem availability is weighted by cable TV subscribers. The weighted averages include ILECs or cable system operators that report no availability. Table 2.8 Percentage of Residential End-User Premises with Access to High-Speed Services as of June 30, 2006 2 - 11 * Years 2001 and 2003 reflect 2000 Census-based weights and earlier years use 1990 Census-based weights. Source: A Nation Online: Entering the Broadband Age, September 2004, U.S. Department of Commerce, Economics and Statistics Administration (ESA), National Telecommunications and Information Administration (NTIA), and U.S. Census Bureau. Chart 2.10 Percent of U.S. Households With Computers, Internet Access, and High-Speed Access Selected Years (1997 - 2003) * 38.6% 18.6% 42.1% 26.2% 51.0% 41.5% 4.4% 56.2% 50.5% 9.1% 61.8% 54.6% 19.9% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% P ercent of U . S. H ouseholds Computer 38.6% 42.1% 51.0% 56.2% 61.8% Internet Access 18.6% 26.2% 41.5% 50.5% 54.6% High-Speed Access 4.4% 9.1% 19.9% Oct 1997 Dec 1998 Aug 2000 Sept 2001 Oct 2003 2 - 12 Internet Service 54.1 % 54.8 % 54.6 % Dial-Up Service 40.4 32.3 34.3 High-Speed Service 13.2 21.8 19.9 Cable Modem 7.7 12.4 11.2 DSL 5.0 9.4 8.3 Satellite and Fixed Wireless (MMDS 1 ) 0.6 0.3 0.4 Other 0.4 0.5 0.4 Source: A Nation Online: Entering the Broadband Age, September 2004, U.S. Department of Commerce, Economics and Statistics Administration (ESA), National Telecommunications and Information Administration (NTIA), and U.S. Census Bureau 1 MMDS - Multi-Media Distribution Systems. Table 2.9 Percent of U.S. Households with Internet Connections by Technology Rural versus Urban Rural Urban Total (As of October 2003) (As of October 2003) Chart 2.11 Percent of U.S. Households with Internet Connections by Technology Rural versus Urban 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% Rural 54.1% 40.4% 13.2% Urban 54.8% 32.3% 21.8% Internet Service Dial-Up Service High-Speed Service 2 - 13 3-1 3 Consumer Expenditures The Bureau of Labor Statistics conducts surveys of consumer expenditures, in part, to develop weights for CPI indices. Table 3.1 shows total annual expenditures for telephone service for all consumer units. About 2% of all consumer expenditures are devoted to telephone service. This percentage has remained virtually unchanged over the past twenty years, despite major changes in the telephone industry and in telephone usage. Average annual expenditures on telephone service increased from $360 per household in 1981 to $990 in 2004. Bill Harvestingฎ data collected by TNS Telecoms provide information on the telecommunications expenditures of households. (Additional information on TNS Telecoms can be found in Section 14 and Appendix B.) Expenditures can be classified by the type of service provider. Table 3.2 presents average monthly household bills from local exchange, long distance and wireless providers for 1995 through 2005. The upper portion of the table shows average monthly expenditures for the entire sample of households while the lower shows average monthly expenditures among those households billed by each type of service provider. The average monthly household bill from local exchange service providers is the same in both portions of the table since every household in the sample was billed by a local exchange service provider. For long distance and wireless providers, average monthly household expenditures are greater in the latter portion of the table since those households not billed by these providers are removed from the average. It's important to note that categorizing telecommunications providers by the type of service they provide has become increasingly difficult. For some households taking bundled local and long distance service, it was impossible to separate the bill into its component parts. In those cases, the entire bill was allocated to the local exchange service provider. Another measure of consumer expenditures for telephone service is provided by the Bureau of Economic Analysis. The estimates of personal consumption expenditures by wireline and cellular services in Table 3.3 and Charts 3.1 and 3.2 illustrate the increasing importance of the wireless share of household telephone service expenditures. 1981 $17,558 $360 2.1 % 1982 18,071 375 2.1 1983 19,692 415 2.1 1984 21,975 435 2.0 1985 23,490 455 1.9 1986 23,866 471 2.0 1987 24,414 499 2.0 1988 25,892 537 2.1 1989 27,810 567 2.0 1990 28,381 592 2.1 1991 29,614 618 2.1 1992 29,846 623 2.1 1993 30,692 658 2.1 1994 31,731 690 2.2 1995 32,264 708 2.2 1996 33,797 772 2.3 1997 34,819 809 2.3 1998 35,535 830 2.3 1999 36,995 849 2.3 2000 38,045 877 2.3 2001 39,518 914 2.3 2002 40,677 957 2.4 2003 40,817 956 2.3 2004 43,395 990 2.3 Source: Bureau of Labor Statistics, Consumer Expenditure Survey. Table 3.1 Annual Expenditures for All Households Telephone Expenditures as a Percent of All Expenditures Year All Expenditures Telephone Expenditures Household Expenditures for Telephone Service 3 - 3 Table 3.2 Average Monthly Household Telecommunications Expenditures By Type of Provider Year Local Exchange Long Distance Total 1995 $30 $21 $51 $7 $58 1996 30 21 51 9 60 1997 32 25 57 11 68 1998 33 23 56 14 70 1999 34 21 55 17 72 2000 35 18 53 23 76 2001 36 15 51 29 80 2002 36 12 48 35 83 2003 37 10 47 41 88 2004 36 9 45 47 92 2005 36 8 44 53 97 Year Local Exchange Long Distance Total 1995 $30 $24 $54 $46 $100 1996 30 26 56 45 101 1997 32 28 60 40 100 1998 33 28 61 41 102 1999 34 25 59 42 101 2000 35 24 59 46 105 2001 36 21 57 51 108 2002 36 19 55 56 111 2003 37 16 53 62 115 2004 36 13 49 67 116 2005 36 12 48 74 122 (Averages for all Households) (Averages for only those Households Billed for Service) Note: Average monthly household expenditures are estimates based on sample data. All households in the sample have wireline telephone service. Households in Alaska and Hawaii are excluded from the analysis. No effort was made to distinguish bundled prices from a la carte prices. For households taking bundled local and long distance from the same provider, the entire bill is generally considered local. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Wireline Providers Wireline Providers Wireless Providers Total Wireless Providers Total 3 - 4 Table 3.3 Personal Consumption Expenditures (Expenditure Amounts Shown in Millions) All Goods Wireline Cellular Total Telephone Wireline Cellular and Telephone Telephone Telephone Service as a as a Services Services Services Services as a Percentage Percentage 1/ 2/ 3/ Percentage of All of All of All Telephone Telephone Goods & Service Service Services 1980 $1,757,133 $27,560 $0 $27,560 1.6 % 100 % 0 % 1981 1,941,060 30,883 0 30,883 1.6 100 0 1982 2,077,268 35,140 0 35,140 1.7 100 0 1983 2,290,556 38,639 0 38,639 1.7 100 0 1984 2,503,287 41,786 0 41,786 1.7 100 0 1985 2,720,305 45,877 101 45,978 1.7 100 0 1986 2,899,724 49,088 173 49,261 1.7 100 0 1987 3,100,234 51,637 242 51,879 1.7 100 0 1988 3,353,615 53,771 591 54,362 1.6 99 1 1989 3,598,496 56,689 1,352 58,041 1.6 98 2 1990 3,839,937 58,276 2,246 60,522 1.6 96 4 1991 3,986,066 60,660 3,088 63,748 1.6 95 5 1992 4,235,265 65,803 4,866 70,669 1.7 93 7 1993 4,477,887 68,370 6,423 74,793 1.7 91 9 1994 4,743,287 72,634 8,522 81,156 1.7 89 11 1995 4,975,787 73,753 11,274 85,027 1.7 87 13 1996 5,256,832 79,052 13,735 92,787 1.8 85 15 1997 5,547,400 87,942 15,706 103,648 1.9 85 15 1998 5,879,482 91,410 18,902 110,312 1.9 83 17 1999 6,282,474 94,249 24,149 118,397 1.9 80 20 2000 6,739,378 94,880 30,187 125,068 1.9 76 24 2001 7,055,038 91,658 36,713 128,371 1.8 71 29 2002 7,350,722 87,002 41,750 128,752 1.8 68 32 2003 7,709,874 83,669 46,212 129,881 1.7 64 36 2004 8,214,298 79,550 52,559 132,109 1.6 60 40 2005 8,745,746 78,164 58,209 136,373 1.6 57 43 1/ Represents the sum of three series: Durable Goods (Series E1TDG1 A); Non-durable goods (Series E1TND1 A) and Services (Series E1TSS1 A). 2/ Represents the sum of two series: Local Telephone Service (Series E1OLC1 D) and Long Distance Telephone Services (Series E1LDT1 D). 3/ Cellular Telephone Service (Series E1CEL1 D). Source: Bureau Of Economic Analysis, National Economic Accounts, Table 2.4.5U. Personal Consumption Expenditures by Type of Product. See http://www.bea.gov/bea/dn/nipaweb/nipa_underlying/TableView.asp?SelectedTable=22& FirstYear=2005&LastYear=2006&Freq=Qtr, visited September 13, 2006. 3 - 5 Chart 3.1 Personal Consumption Expenditures for Telephone Service ($ Billions) Chart 3.2 Monthly Personal Consumption Expenditures for Telephone Service per Household $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $ B illio n s 1980 1985 1990 1995 2000 2005 Wireline Cellular $0 $10 $20 $30 $40 $50 $60 $70 $80 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Wireline Cellular 3 - 6 4-1 4 Earnings Beginning in the mid-1980s, local exchange carriers that file access tariffs with the Commission were required to file rate-of-return reports (FCC Form 492). The first reports were filed for the monitoring period October 1, 1985 - December 31, 1986. Carriers filed reports for each subsequent two-year monitoring period (1987-88 and 1989-90). In 1991, carriers that became subject to price-cap incentive regulation began filing reports on a yearly basis. Non-price-cap carriers filed annual reports for each monitoring period. Table 4.1 is a summary of interstate rates of return for 1998-2005 filed by price-cap carriers. Rates of return for 1991-1997 can be found in the August 2001 Trends report which can be accessed at www.fcc.gov/wcb/stats. The rates of return shown in Table 4.1 were those posted at the time of the carriers’ individual FCC Form 492 filings. They do not reflect revisions filed by the carriers at a later date. Thus, they are not necessarily the official versions for regulatory purposes, but they do illustrate general industry trends. Summaries of the filings can be found on the Wireline Competition Bureau Statistical Reports web site at www.fcc.gov/wcb/stats. Copies of the FCC Form 492A reports are on file in the FCC's Reference Information Center, Courtyard Level, 445 12th Street S.W., Washington, D.C. 20554. Reporting Entity 2002 2001 2000 1999 1998 1 BellSouth Telecommunications, Inc. 24.71 22.68 21.93 % 19.35 % 21.25 % 22.83 % 20.99 % 20.80 % 2 Qwest Corporation, Including Malheur and El Paso 28.60 25.07 22.74 20.08 19.14 19.93 19.06 16.56 SBC Communications, Inc. 3 Southwestern Bell Telephone Company L.P. 27.92 16.38 6 15.60 14.88 18.81 15.17 10.22 9.91 4 Ameritech Operating Companies 31.29 22.51 20.55 20.24 25.72 30.24 28.93 22.59 5 Nevada Bell Telephone Company 36.81 24.76 20.16 14.86 20.86 21.55 19.26 16.02 6 Pacific Bell Telephone Company 27.47 28.77 26.23 21.00 23.79 19.20 21.01 16.50 7 Southern New England Telephone Company, The 20.27 21.82 6 23.93 18.47 23.57 18.21 12.12 10.99 Verizon Telephone Companies 8 Verizon Telephone Companies (Verizon FCC Tariff No. 1) 14.51 11.24 8.00 11.95 12.93 13.36 13.66 (Former Bell Atlantic Companies) Bell Atlantic 13.88 Bell Atlantic (NYNEX) 11.40 New England Telephone and Telegraph Co. New York Telephone 9 Verizon California Inc. (California - GTCA) 28.91 34.99 29.17 28.50 28.48 25.87 22.01 17.19 10 Verizon California Inc. (California - COCA) 26.02 36.93 30.64 28.22 29.80 28.74 28.28 22.71 11 Verizon California Inc. (Arizona - COAZ) 32.00 6.17 2.05 6.99 13.25 10.9 15.57 13.80 12 Verizon California Inc. (Nevada - CONV) 28.08 28.79 28.51 24.08 26.66 28.82 20.57 24.01 13 Verizon Florida Inc. (Florida - GTFL) 32.57 28.96 24.46 22.03 29.23 21.90 18.93 14.58 14 Verizon North Inc. (COPA + COQS = COPT) 39.10 32.88 6 40.74 43.61 39.71 41.05 39.58 45.97 15 Verizon North Inc. (Illinois - COIL) 41.49 41.72 60.34 54.09 53.67 44.51 41.03 14.11 16 Verizon North Inc. (Indiana - COIN) 51.58 40.36 47.34 46.06 46.55 47.67 41.40 34.61 17 Verizon North Inc. (Ohio - GTOH) 21.17 18.58 19.39 19.53 20.45 21.88 21.7 21.83 18 Verizon North Inc. (Pennsylvania - GTPA) 54.03 20.50 13.76 22.50 23.17 21.95 21.41 14.67 19 Verizon North Inc. (Wisconsin - GTWI) 13.99 11.53 6 10.85 9.90 14.16 16.99 17.85 16.08 20 Verizon North/Verizon South (GTIN + GLIN = GAIN) 23.19 22.34 22.64 24.75 32.82 33.00 32.47 29.06 21 Verizon North/Contel South (GTMI + GLMI = GAMI) 18.01 14.83 6 15.10 16.64 17.49 16.45 15.75 13.17 22 Verizon North/Verizon South (GTIL + GLIL = GAIL) 23.20 23.29 21.99 21.54 23.67 23.90 22.35 23.07 23 Verizon Northwest Inc. (Oregon - GTOR) 32.91 25.44 26.28 26.10 31.69 30.95 31.56 27.03 24 Verizon Northwest Inc. (West Coast CA - GNCA) (33.60) (9.44) (13.80) (5.17) 1.91 (8.35) (9.93) (6.85) 25 Verizon Northwest Inc. (Washington - COWA) 33.62 30.44 36.20 31.57 40.06 39.49 39.17 30.41 26 Verizon Northwest Inc. (Washington - GTWA) 33.60 33.91 29.82 28.97 34.03 33.26 32.91 27.33 27 Verizon Northwest Inc. (Idaho - GTID) 44.03 34.53 28.20 33.01 38.74 34.17 32.24 30.89 28 Verizon South Inc. (North Carolina - GTNC) (22.63) 17.52 16.74 23.45 30.08 26.44 24.85 27.92 29 Verizon South Inc. (N. Carolina - CONC) 4.39 10.10 14.77 21.97 22.17 17.75 19.87 12.78 30 Verizon South Inc. (GTSC + COSC = GTST) 23.47 39.63 28.19 29.82 32.44 31.19 30.70 Verizon South Inc. (Alabama - GTAL) 24.02 20.24 22.23 17.59 Verizon South Inc. (Kentucky - COKY) 30.95 20.60 9.55 5.97 Verizon South Inc. (Kentucky - GTKY) 27.21 25.07 24.03 22.34 GTE South Inc. (South Carolina - GTSC) 30.62 GTE South Inc. (South Carolina - COSC) 26.14 31 Verizon South Inc. (Virginia - COVA) 46.97 33.50 39.52 40.41 40.69 40.85 34.74 35.19 32 Verizon South Inc. (Virginia - GTVA) 22.83 24.17 (22.01) 1.76 9.53 6.62 9.94 20.56 33 GTE Southwest Inc. dba Verizon Southwest (Texas - COTX) 11.26 11.23 10.05 12.46 11.9 12.17 17.13 14.96 34 GTE Southwest Inc. dba Verizon Southwest (Texas - GTTX) 18.63 18.21 18.74 20.47 24.35 21.65 21.42 16.43 GTE Midwest Inc. (Missouri - COMO + COCM + COEM = COMT) 20.33 17.06 15.29 12.56 GTE Midwest Inc. (Missouri - GTMO) 23.92 19.15 11.82 16.08 GTE Systems of The South (Alabama - COAL) 15.77 14.93 10.88 7.97 % (Final Reports for 1998 Through 2004 and Initial Report for 2005) 1 200320042005 % Table 4.1 Interstate Rate of Return Summary * Years 1998 through 2005 Price-Cap Companies Reporting FCC Form 492A 4 - 3 Reporting Entity 2002 2001 2000 1999 Sprint 37 Central Telephone Company - Nevada Division 45.68 % 43.37 % 34.16 % 23.80 % 19.61 % 19.29 % 21.15 % 17.79 % 38 Sprint - Florida Incorporated 42.94 40.98 6 35.54 29.41 25.89 27.38 27.17 26.14 39 Sprint Local Telephone Cos. - Eastern (NJ & PA) 56.33 55.14 6 45.38 37.78 26.21 25.62 20.87 14.59 40 Sprint Local Telephone Cos. - Midwest (MO, KS, MN, NE, WY, TX) 32.3 29.17 6 25.24 18.89 16.63 18.88 17.69 19.66 41 Sprint Local Telephone Cos. - North Carolina 50.81 51.62 6 45.89 36.64 25.56 22.23 15.92 12.55 42 Sprint Local Telephone Cos. - Northwest (OR & WA) 33.81 23.90 6 33.51 34.62 31.55 32.77 31.86 32.54 43 Sprint Local Telephone Cos. - Southeast (TN, VA & SC) 38.73 36.14 6 34.34 33.76 25.33 23.32 17.50 15.87 44 United Telephone Co. of Indiana, Inc. 71.84 68.80 6 46.47 41.75 35.19 38.21 28.98 24.19 45 United Telephone Co. of Ohio 46.2 39.01 6 31.50 30.89 27.13 20.03 20.16 17.33 All Other Companies 46 ALLTEL Nebraska, Inc. 28.40 14.25 6 13.43 12.20 12.57 12.99 19.27 15.02 47 Kentucky ALLTEL - Lexington, Inc. 38.10 33.40 6 26.75 27.78 48 Kentucky ALLTEL - London, Inc. 23.37 25.50 6 26.26 28.76 49 CenturyTel of Belle-Hermann/So Missouri/Sw Missouri (CNMO) 28.36 22.94 14.53 4.69 2 50 CenturyTel of Central Missouri (CNMC) 44.95 37.88 6 32.54 11.83 2 51 CenturyTel of Northern Alabama (CNAN) 21.54 11.97 8.23 7.49 3 52 CenturyTel of Southern Alabama (CNAS) 27.84 23.21 24.13 15.78 3 53 Cincinnati Bell Telephone Company 34.47 33.71 6 32.48 28.64 4 30.09 28.95 25.45 17.81 54 Citizens Comms Cos. dba Citizens Comms FCC Tariff 1 (CTC1) 32.31 34.99 6 24.40 19.27 15.73 19.68 16.71 17.87 55 Citizens Comms Cos. dba Citizens Comms FCC Tariff 2 (CTC2) 29.13 37.75 6 16.14 20.67 17.30 24.05 15.74 14.29 56 Citizens Comms Cos. dba Citizens Comms FCC Tariff 3 (CTC3) 16.24 12.19 6 10.40 8.94 4.52 16.12 15.56 57 Citizens Comms Cos. dba Citizens Comms FCC Tariff 4 (CTC4) 49.91 42.79 6 35.38 23.31 13.08 30.94 58 Frontier Telephone of Rochester 14.03 55.89 6 10.67 11.47 12.32 18.91 16.77 18.37 59 Frontier Tier 2 Concurring Companies 50.77 11.45 6 38.49 33.34 38.12 38.95 43.42 45.45 60 Frontier Comms of Minnesota & Frontier Comms of Iowa 25.12 33.67 6 32.16 31.15 25.24 33.16 35.40 29.28 61 Citizens Telecommunications Cos. (CTC5) 40.37 4.90 0.86 (11.23) 62 Hawaiian Telecom 21.88 9.44 7 16.96 15.30 16.72 17.87 17.62 15.64 63 Iowa Telecom Service Group 19.36 17.30 6 17.58 5 14.26 4 13.07 64 Iowa Telecom Systems Service Group 19.14 20.16 23.97 5 20.47 4 18.45 65 Micronesian Telecommunications Corp. 37.67 43.52 67 33.91 32.75 21.83 23.58 29.24 34.45 66 Valor New Mexico #1164 28.25 22.96 6 18.45 16.86 11.45 20.67 67 Valor New Mexico #1193 17.77 21.16 6 20.41 15.88 8.39 13.35 68 Valor Oklahoma 19.38 15.29 6 8.69 9.31 11.65 11.22 69 Valor Texas 18.08 13.47 6 15.21 10.66 5.70 5.24 Maximum Rate of Return 71.84 % 68.80 % 59.89 % 54.09 % 53.67 % 47.67 % 43.42 % 48.69 % Minimum Rate of Return (33.60) (9.44) (17.50) (5.17) 0.86 (11.23) (9.93) (25.83) Weighted Arithmetic Mean 23.48 20.44 18.06 17.69 19.62 18.04 18.50 15.60 Standard Deviation 9.13 9.00 8.63 5.69 5.80 5.17 5.96 3.96 * The interstate rates of return reported by carriers on the FCC Form 492A may not necessarily agree with the interstate rates of return reported by the carriers on other Commission forms. For example, price-cap carriers also report interstate rates of return on the Commission's Automated Reporting Management Information System's (ARMIS) 43-01 report. The interstate rates of return reported by carriers on the ARMIS 43-01 include revenues and costs for non- price-cap services. 1 For years 1991 - 1997, see Industry Analysis Division, Common Carrier Bureau, Trends in Telephone Service (August 2001). 2 For the reporting period 9/1/02 - 12/31/02. 3 For the reporting period 7/1/02 - 12/31/02. 4 For final 2002, there were no changes to the preliminary. 5 For final 2003, there were no changes to the preliminary. 6 For final 2004, there were no changes to the preliminary. 7 Verizon sold these companies in 2005. Table 4.1 2003 Interstate Rate of Return Summary * Years 1998 through 2005 (Final Reports for 1998 Through 2004 and Initial Report for 2005) 1 Price-Cap Companies Reporting FCC Form 492A - Continued 199820042005 4 - 4 5 Employment and Labor Productivity The Bureau of Labor Statistics (BLS) publishes monthly data regarding the total number of employed workers in the communications industry. Specifically, BLS compiles employment statistics for the entire telephone communications industry. 1 These are classified according to the North American Industry Classification System (NAICs). NAICS is a collaborative effort between the United States, Canada, and Mexico to provide new comparability in statistics about business activity across North America. The telecommunications industry subsector (517) can be found in the NAICS Information Sector – 51. The industry groups under telecommunications are as follows: wired telecommunications carriers (5171); wireless telecommunications carriers – wireless (excluding satellite), paging, cellular and other wireless (5172); telecommunications resellers (5173); telecommunications distribution (5175); and other telecommunications (5179). Further information on NAICS can be found on the Census Bureau web site at http://www.census/gov/epcd/www/naics.html. Table 5.1 and the associated graph show the information compiled by BLS for the annual average employment figures for the telecommunications industry – NAICS 517, as well as the industry distributions for wired telecommunications carriers – NAICS 5171, wireless telecommunications carriers – NAICS 5172, telecommunications resellers – NAICS 5173, and cable and other program distribution – NAICS 5175. Wireless telecommunications carriers’ employees are further shown for cellular and other wireless carriers – NAICS 517212. Monthly employment data for these categories from 1990 to the present can be found on the BLS web site at www.bls.gov. Table 5.2 and the associated graph show the information compiled by BLS for the labor productivity index for wired telecommunications carriers – NAICS 5171 and wireless telecommunications carriers – NAICS 5172. The BLS index of labor productivity relates output to the employee hours expended in producing that output. Table 5.3 presents estimates of the number of telecommunications service providers that the Small Business Administration’s Office of Size Standards defines as small businesses (i.e., 1,500 or fewer employees, including all affiliates). 1 BLS used to compile data based on the Standard Industrial Classification (SIC) system. With the May 2003 data, the employment series underwent a complete industry reclassification, changing from the 1987 SIC system to the 2002 NAICS. Employment statistics from 1951 to 2002 based on the SIC system can be found in Table 5.1 of the Industry Analysis and Technology Division, Wireline Competition Bureau, Trends in Telephone Service (August 2003). The Labor Productivity Index for the telephone communications industry for the years 1951 to 2002 based on the SIC system can also be found in the August 2003 edition of Trends in Table 5.2. 5 - 1 Year Telecom Wired Wireless Cellular and Telecom Cable and Carriers Telecom Telecom Other Wireless Resellers Other Program Carriers Carriers Carriers Distribution 517 5171 5172 517212 5173 5175 1990 980.3 672.2 35.8 30.4 179.5 70.1 1991 973.1 662.7 41.8 35.4 178.1 71.3 1992 946.0 637.2 47.8 40.3 172.6 72.7 1993 942.2 624.5 56.3 47.4 170.5 75.8 1994 961.1 621.9 71.7 60.3 171.8 80.4 1995 975.7 611.1 90.3 75.9 171.2 86.6 1996 997.0 603.2 110.1 92.5 171.6 94.6 1997 1,059.5 629.9 132.1 111.0 181.3 96.9 1998 1,107.8 652.1 144.2 121.1 188.7 102.4 1999 1,179.7 688.1 160.0 134.3 200.2 110.9 2000 1,262.6 719.2 185.6 155.7 213.6 123.0 2001 1,302.1 732.2 201.4 171.0 214.1 129.2 2002 1,186.5 650.7 197.3 170.4 179.5 130.3 2003 1,082.3 579.2 189.8 166.9 154.9 132.5 2004 1,034.6 548.3 189.0 168.3 149.8 129.6 2005 998.7 514.3 192.3 172.5 135.1 133.8 Source: Bureau of Labor Statistics. (In Thousands) Table 5.1 Annual Average Number of Employees in the Telecommunications Industry (In Thousands) Annual Average Number of Employees in the Telecommunications Industry Chart 5.1 0 200 400 600 800 1,000 1,200 1,400 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Telecom Carriers Wired Carriers Wireless Carriers Cellular & Other Wireless Telecom Resellers Cable & Other 5 - 3 Year 1988 62.02 77.86 1989 65.26 76.97 1990 66.04 70.38 1991 68.07 66.17 1992 72.13 74.42 1993 76.85 83.81 1994 82.41 89.59 1995 87.59 90.05 1996 96.50 101.66 1997 100.00 100.00 1998 107.73 110.48 1999 116.65 145.21 2000 122.68 152.76 2001 116.74 191.88 2002 124.13 217.94 2003 130.24 242.49 2004 131.32 288.74 Source: Bureau of Labor Statistics Wired Wireless Table 5.2 Labor Productivity Index for the Wired and Wireless Telecommunications Industry Measured in Output per Hour (OPH) (Base Year 1997 = 100) Carriers Carriers Wired and Wireless Telecommunications Carriers (NAICS 5171 and 5172) Labor Productivity Index (NAICS 5171) (NAICS 5172) Chart 5.2 0.00 50.00 100.00 150.00 200.00 250.00 300.00 350.00 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Wired (5171) Wireless (5172) 5 - 4 Table 5.3 Number of Telecommunications Service Providers by Size of Business (As of October 20, 2005) 1,500 or Fewer Employees 2 More than 1,500 Employees 2 Incumbent Local Exchange Carriers (ILECs) 1,307 1,019 288 Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs) 859 741 118 Local Resellers 184 181 3 Shared-Tenant Service Providers 16 16 0 Other Local Service Providers 44 43 1 Total Local Competitors 1,103 981 122 Total Fixed Local Service Providers 2,410 2,000 410 Payphone Service Providers 657 653 4 Private Service Providers 59 54 5 Wireless Telephony Including Cellular, Personal Communications Service (PCS) and SMR Telephony Carriers 432 221 211 Paging and Messaging Service Providers 365 360 5 Specialized Mobile Radio (SMR) Dispatch 187 187 0 Wireless Data and Other Mobile Service Providers 47 46 1 Total Wireless Service Providers 1,031 814 217 Interexchange Carriers (IXCs) 330 309 21 Operator Service Providers (OSPs) 23 22 1 Prepaid Calling Card Providers 104 102 2 Satellite Service Providers 44 41 3 Toll Resellers 881 853 28 Other Toll Carriers 93 91 2 Total Toll Service Providers 1,475 1,418 57 All Filers 5,632 4,939 693 Holding Company Analysis Filers without Affiliates: Holding Company Level 3,592 3,575 17 Filer Level 3,592 3,575 17 Filers with Affiliates 3 : Holding Company Level 513 468 45 Filer Level 2,040 1,364 676 Total, Holding Company Level 4,105 4,043 62 Total, Filer Level 5,632 4,939 693 2 Employee counts are estimated at the holding company level, yet presented at the filer level. If our analysis indicates that, at the holding company level, a group of filers together employs more than 1,500 people, then each of the individual filers that comprise the holding company are entered in the column labeled as such. Therefore, our estimates do not imply that each or any of the individual filers alone employs more than 1,500 persons. Source: FCC Form 499-A filings and IATD staff estimates. Filers that in Combination with Affiliates Have Number of FCC Form 499-A Filers 1 Type of Provider 1 While FCC Form 499-A filings are not publicly available, filer registration information is published by the Industry Analysis and Technology Division (IATD) in the Telecommunications Provider Locator (March 2006), which can be accessed at www.fcc.gov/wcb/stats. This same information is searchable online at www.fcc.gov/wcb/iatd/locator.html. Note: Estimates are based on gross revenue data filed on the 2005 FCC Form 499-A worksheets, and public employment data from ARMIS and Securities and Exchange Commission filings. Filers were considered affiliated based on information from their FCC Form 499-A filings. These estimates do not reflect affiliates that do not provide telecommunications service or that operate solely outside the United States. 3 In some cases, affiliated companies may file a single FCC Form 499A for all operations. Such consolidated filings are included in this category. 5 - 5 6 -1 6 International Telephone Service International telecommunications has become an increasingly important segment of the telecommunications market. International telephone calling -- propelled by technological innovation, and increased international trade and travel -- has skyrocketed. In 1980, customers in the United States were billed for almost 2 billion minutes of calls to international points. This figure increased to 8 billion in 1990, 30 billion in 2000, and 64 billion in 2004. Americans spent $9.2 billion on international calls in 2004. On average, carriers billed 14 cents per minute for international calls in 2004, a decline of 90% since 1980, and 72% since 2000. International private line revenues increased through 2000 but have declined significantly since then. These trends are shown in Table 6.1. Chart 6.1 shows the trends in billed revenues per minute and per call since 1980. U.S. and foreign carriers compensate each other when one carries traffic that the other bills. Because Americans place more calls than they receive, U.S. carriers make substantial net payments to foreign carriers -- $3.6 billion in 2004. Falling compensation rates have more than offset the growth in traffic in recent years. Trends in settlement payments are shown in Table 6.2. International traffic data are available on a country-by-country basis. Table 6.3 summarizes traffic by region of the world. Five markets -- Canada, Mexico, the United Kingdom, Germany, and India -- currently account for about 38% of the international billed minutes in the United States. Chart 6.2 shows the percentage breakout for the five markets. Since 1985, when MCI began to compete with AT&T for international calls, numerous carriers have begun to provide international service. Seventy-two carriers provided international telecommunications service in 2004 by using their own facilities or lines leased from other carriers. These carriers provided $8.7 billion of international telephone service between the U.S. and foreign points, $458 million of international private line service, and $136 million other miscellaneous international services. Table 6.4 shows the U.S.-billed revenues for the 54 carriers that did not request confidential treatment. Together, AT&T, MCI, and Sprint, accounted for 78% of the international service billed in the United States. Seven hundred and eighteen carriers reported revenues for international message telephone service that they provided on a pure resale basis. These carriers reported $5.2 billion of pure resale revenues in 2004. Table 6.5 shows pure resale revenues for the carriers with the highest pure resale messages, minutes and revenues. The data compiled in Tables 6.1 - 6.5 are filed pursuant to section 43.61 of the Commission's rules. Preliminary data are filed July 31st of each year and final data are filed October 31st. Additional information can be found in a number of international reports on the Internet on the Wireline Competition Bureau Statistical Reports web page at www.fcc.gov/wcb/stats. Table 6.1 International Service from the United States (Minute, Message, and Revenue Amounts Shown in Millions) Telephone Service Other Services Billed Revenues Billed Revenues Minutes Total Per Per Call Telex Misc. End-User 1 Minute 2 Services 1980 1,569 199 $2,097 $1.34 $10.53 $325 $63 $115 1981 1,857 233 2,239 1.21 9.61 350 62 126 1982 2,187 274 2,382 1.09 8.70 363 56 138 1983 2,650 322 2,876 1.09 8.92 379 54 154 1984 3,037 367 3,197 1.05 8.71 394 46 158 1985 3,446 411 3,487 1.01 8.49 415 45 172 1986 4,126 482 4,004 0.97 8.30 390 42 175 1987 4,819 570 4,751 0.99 8.33 360 35 191 1988 5,679 687 5,806 1.02 8.45 310 30 194 1989 6,751 835 6,912 1.02 8.28 243 27 208 1990 8,030 984 8,059 1.00 8.19 196 24 201 1991 9,072 1,384 9,263 1.02 6.69 201 15 309 $23 1992 10,294 1,663 10,382 1.01 6.25 156 16 323 24 1993 11,513 1,945 11,564 1.00 5.95 136 12 366 23 1994 13,616 2,347 12,543 0.92 5.35 123 12 441 25 1995 15,889 2,830 14,335 0.90 5.07 120 6 514 48 1996 19,325 3,520 14,598 0.76 4.15 119 5 661 26 1997 22,753 4,259 15,661 0.69 3.68 110 4 851 28 1998 24,250 4,477 14,726 0.61 3.29 64 2 921 36 1999 28,515 5,305 14,980 0.53 2.82 57 2 1,216 31 2000 30,135 5,742 14,909 0.49 2.60 33 1 1,480 251 2001 33,287 6,265 11,380 0.34 1.82 10 * 1,419 199 2002 35,064 5,926 9,956 0.28 1.64 ** ** 988 113 2003 42,664 7,350 8,944 0.21 1.22 ** ** 620 156 2004 63,553 10,895 9,178 0.14 0.84 ** ** 458 137 * Denotes revenues less than $500,000. ** Data not filed. 1 Billed revenues in Table 6.1 differ from billed revenues in Table 6.3. The amounts shown here represent charges to end-user customers and equal the amounts billed by underlying carriers plus estimated reseller markups. The amounts shown in Table 6.3 are the amounts reported by the underlying carriers that carried the traffic to foreign destinations. 2 Billed revenue per minute for international service differs in Table 6.1 and Table 13.3. Data in Table 6.1 are calculated using all U.S. billed minutes and revenues. Data for Table 13.3 represent charges for most U.S. billed calls that originate or terminate in the United States. International-to-international revenues and reorigination, country-beyond and country-direct minutes are not included in that table. International Bureau, Trends in the International Telecommunications Industry (September 2005). Data for 2004 from International Bureau, International Telecommunications Data (March 2006). Billed Revenues per Minute and per Call Note: Data represent traffic and circuits from all U.S. points. Chart 6.1 Telegraph Private LineMessages Source: $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 $0.00 $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 Per Minute Per Call 6 - 3 Table 6.2 International Telephone Service Settlements (Revenue Amounts Shown in Millions) Average per Minute Settlement Settlement U.S. Owed to Due from Carrier Net End-User Retained Due from Net Foreign Foreign End-User Billed Owed to End-User Foreign Net End-User Carriers Carriers Revenues Revenues Foreign Revenues Carriers Settlements Revenues for U.S. for Foreign All 1/ Carriers 1/ 2/ 1/ Billed Calls Billed Calls Traffic 3/ 1980 $2,097 $1,063 $1,034 $716 ($347) $1,750 $0.68 0.62 $0.64 1981 2,239 1,330 910 799 (531) 1,708 0.72 0.56 0.52 1982 2,382 1,674 708 961 (712) 1,670 0.77 0.60 0.44 1983 2,876 2,036 841 1,086 (950) 1,926 0.77 0.60 0.43 1984 3,197 2,269 928 1,066 (1,203) 1,994 0.75 0.54 0.40 1985 3,487 2,398 1,089 1,243 (1,155) 2,332 0.70 0.55 0.41 1986 4,004 2,865 1,140 1,396 (1,469) 2,536 0.69 0.56 0.38 1987 4,751 3,423 1,328 1,671 (1,752) 2,999 0.71 0.59 0.39 1988 5,806 4,039 1,767 1,906 (2,133) 3,674 0.71 0.59 0.41 1989 6,912 4,735 2,177 2,213 (2,523) 4,390 0.70 0.58 0.42 1990 8,059 5,297 2,762 2,426 (2,871) 5,188 0.66 0.56 0.42 1991 9,263 5,852 3,411 2,536 (3,317) 5,946 0.65 0.51 0.42 1992 10,382 6,008 4,375 2,650 (3,357) 7,025 0.58 0.46 0.44 1993 11,564 6,372 5,192 2,667 (3,705) 7,859 0.55 0.43 0.44 1994 12,543 7,010 5,533 2,719 (4,291) 8,252 0.51 0.39 0.40 1995 14,335 7,569 6,766 2,631 (4,938) 9,397 0.48 0.35 0.40 1996 14,598 8,252 6,345 2,594 (5,658) 8,939 0.43 0.30 0.32 1997 15,661 8,031 7,630 2,602 (5,429) 10,232 0.35 0.27 0.31 1998 14,726 7,022 7,704 2,538 (4,484) 10,242 0.29 0.21 0.28 1999 14,980 6,383 8,597 1,782 (4,601) 10,379 0.22 0.15 0.26 2000 14,909 5,536 9,373 1,609 (3,927) 10,982 0.18 0.11 0.25 2001 11,380 4,526 6,854 1,181 (3,346) 8,034 0.14 0.08 0.17 2002 9,956 3,733 6,223 892 (2,842) 7,114 0.11 0.05 0.14 2003 8,944 3,649 5,295 873 (2,777) 6,167 0.09 0.04 0.10 2004 9,188 4,623 4,530 1,016 (3,642) 5,546 0.07 0.04 0.07 1/ Billed revenues in Table 6.2 differ from billed revenues in Table 6.3. The amounts shown here represent charges to end-user customers and equal the amounts billed by underlying carriers plus estimated markups, where service was provided through resellers. The amounts shown in Table 6.3 are the amounts reported by the underlying carriers. Similar differences exist for retained end-user and net revenues. 2/ Beginning in 1991, includes net settlement receipts for transiting traffic. 3/ Beginning in 1991, includes transiting traffic. Note: Data represent traffic to and from all U.S. points. Data for 2004 from International Bureau, International Telecommunications Data (March 2006). Source: International Bureau, Trends in the International Telecommunications Industry (September 2005). 6 - 4 Table 6.3 International Message Telephone Service for 2004 (Figures Rounded to the Nearest Million) Traffic Billed in the United States Traffic Billed in Foreign Countries Total Originating or Terminating Transiting U.S. in the United States Carrier Number Number U.S. Owed to Retained Number Number Due from Retained Retained of of Carrier Foreign Revenues of of Foreign Revenues Revenues Region of the World 1 Messages Minutes Revenues Carriers Messages Minutes Carriers Africa 589 2,652 $457 $319 $138 52 288 $21 $2 $161 Asia 2,054 12,022 1,831 1,136 695 435 2,688 184 6 886 Caribbean 702 4,611 681 387 294 146 533 27 1 322 Eastern Europe 540 3,268 383 232 150 38 283 14 5 170 Middle East 456 2,270 362 229 132 90 496 17 4 154 North and Central America 2,323 20,587 2,520 1,126 1,393 1,819 9,444 224 41 1,658 Oceania 260 1,365 179 78 101 65 467 15 5 122 Other Regions 3 3 4 3 1 5 2 * 1 South America 662 6,052 657 330 328 172 1,003 68 11 407 Western Europe 3,297 10,809 1,577 780 797 1,112 4,365 142 225 1,164 Total for Foreign Points 10,834 63,400 8,639 4,612 4,027 3,911 19,425 707 301 5,035 Total for U.S. Points 56 253 14 10 4 24 153 8 * 11 Total for All International 10,890 63,653 $8,653 $4,623 $4,031 3,936 19,578 $715 $301 $5,047 Points * Denotes values that are less than half a million. 1 The region totals include all international traffic reported by carriers serving domestic U.S. points including Guam and the U.S. Virgin Islands. Most traffic between Guam, the U.S. Virgin Islands, American Samoa and Northern Mariana Islands and other U.S. points are shown separately as the total for U.S. points, and also are included in the total for all international points. The total for all international points also includes all traffic originating in American Samoa and the Northern Mariana Islands, which is excluded from the region totals. Source: International Bureau, International Telecommunications Data (March 2006). Chart 6.2 U.S. Billed Minutes by Country All Other 62.3% Canada 8.5% Germany 3.2% Mexico 15.1% India 5.4% United Kingdom 5.5% 6 - 5 Table 6.4 U.S. Billed Revenues of Facilities-Based and Facilities-Resale Carriers in 2004 1/ (Revenue Amounts Shown in Millions) International Service Total Telephone Private Miscellaneous International Line Billed Revenues A.M.S. Voicecom, Inc. * * ABS-CBN Telecom North America, Inc. 3 3 American Samoa Telecomm. Authority 1 1 Americatel, Inc. 32 32 AT&T Corp. 3,310 164 3,474 Bestel USA Inc. 41 41 Cable & Wireless Americas Operations, Inc. 4 4 Centennial Puerto Rico Operations Corp. 3 3 Cinergy Telecommunications, Inc. 8 8 Colt Telecommunications 6 6 Comsat International 5 5 Comunitel Global, S.A. DataAccess Ltd. 55 55 Embratel Americas, Inc. * * France Telecom Long Distance USA, LLC 10 2 12 Geocomm Corporation * * GNG Networks America, Inc. * * Harris Corporation/MCS 1 1 IDT Corporation 727 727 IMPSAT USA, Inc. 17 17 Intelsat USA License Corp. 8 8 International Access d/b/a Access Int'l. 24 24 IT&E Overseas, Inc. 7 2 8 Japan Telecom America, Inc. 5 5 KDDI America, Inc. 10 10 20 KGM Circuit Solutions, LLC 1 1 KPN-INS, Inc. 23 23 Level 3 Communications, LLC 6 6 Lockheed Martin Corporation 21 21 MCI, Inc. 1,760 137 1,896 NDNT, Inc. 1 1 Norlight Telecommunications, Inc. * * NTT America, Inc. 9 9 Orbitel S.A. E.S.P. 20 4 24 Philippine Long Distance Telephone Co., Ltd. 19 19 Primus Telecommunications, Inc. 235 235 Qwest Services Corporation 11 11 Reliance Communications, Inc. 165 1 166 Satellite Communication Systems, Inc. * 1 1 Sierra USA Communications, Inc. 1 1 Sprint Nextel Corporation 1,718 37 120 1,875 Startec Global Communications Corporation 9 9 Swisscom North America 2 2 Telecom Argentina USA, Inc. 7 7 Telecom Italia Sparkle of North America, Inc 117 117 Telecomunicaciones Ultramarinas-Puerto Rico * * Telefonica Larga Distancia, Inc. (TLD) 4 * 5 Telekom Malaysia (USA), Inc. * * Telenor Global Services AS * * Telmex 3 3 UniPlex Telecom Technologies, Inc. 4 * 4 Universal Telecom Services, Inc. 1 1 Viatel Holding (Bermuda) Limited * * WilTel Communications, LLC 45 6 51 Total All Carriers 2/ 3/ $8,653 $458 $136 $9,341 * Represents revenues greater than $0 but less than $500,000. 1/ Totals exclude pure resale services. Data do not show settlement receipts for terminating foreign billed traffic. 2/ Includes revenues reported for American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands. Also includes $14 million of revenues for calls between the domestic United States and these points. 3/ Totals include revenues for 18 carriers that requested confidential treatment. These carriers reported $303 million of telephone service and $94 million of private line service revenues. Source: International Bureau, International Telecommunications Data (March 2006). 6 - 6 Table 6.5 Top Providers of Pure Resale International MTS in 2004 Percent Number of Number of U.S. Carrier of Total Messages Minutes Revenues IMTS (Millions) (Millions) ($ Millions) Resale Revenues Acceris Communications Corp. 39 386 $53 1.01 % ACN Communication Services, Inc. 2 19 10 0.19 ALLTEL Corporation 5 37 9 0.18 Americatel, Inc. 28 386 86 1.65 AT&T Corp. 113 550 180 3.44 Bak Communications, LLC 8 118 6 0.11 Broadwing, Inc. 12 60 31 0.58 CenturyTel Long Distance, LLC 1 10 8 0.16 Cingular Wireless LLC 125 563 280 5.33 Citizens Communications Company 6 21 6 0.12 Comcast 7 69 20 0.37 Covista Communications 5 28 4 0.08 Cox Communications, Inc. 9 71 23 0.44 Deutsche TeleKom AG 118 647 191 3.63 Dialaround Enterprises, Inc. 8 57 4 0.08 Embratel Americas, Inc. 36 73 15 0.29 Global Crossing, Ltd 121 512 378 7.20 Gold Line Telemanagement, Inc. 17 62 9 0.16 Grande Communications 23 238 9 0.17 IDT Corporation 612 7,138 568 10.82 Intellicall Operator Services, Inc. 2 20 8 0.15 Long Distance of Michigan, Inc. d/b/a LDMI Tele- 4 34 7 0.13 MCI, Inc. 156 932 117 2.23 McLeodUSA Incorporated 11 28 4 0.08 MetroPCS, Inc. 4 21 4 0.08 NECC Telecom, Inc. 12 117 15 0.29 Net One International, Inc. 0 40 5 0.09 Network Communications International Corporation 0 1 8 0.15 NobelTel, LCC 30 197 22 0.42 NOS Communications, Inc. 9 78 14 0.27 PaeTec Communications, Inc. 15 59 15 0.28 PT-1 Long Distance, Inc. 41 311 42 0.79 Qwest Communications International, Inc. 1,087 6,508 452 8.61 Reliance Communications International, Inc. 22 266 33 0.62 Sage telecom, Inc. 1 12 5 0.09 SBC Communications, Inc. 248 1,785 490 9.34 Sprint Nextel Corporation 163 842 219 4.17 Startec Global Communications Corporation 50 254 39 0.73 Supra Telecommunications & Information Services, Inc 7 48 10 0.18 Talk America Inc. 11 88 16 0.31 Telecom Italia of North America, Inc. 70 364 23 0.44 TeleDirect Telecommunications Group, LLC 78 286 27 0.51 Total Call International, Inc. 2 24 5 0.09 Trinsic Communications, Inc 8 56 4 0.08 United States Cellular Corporation 4 20 9 0.16 VarTec Telecom Holding 46 223 50 0.96 Verizon Communications, Inc. 118 645 69 1.31 Western Wireless International Enterprises, Inc. 31 164 25 0.49 WilTel Communications, LLC 896 4,268 265 5.04 Working Assets Funding Services, Inc. 3 27 12 0.23 Total for 24 Companies Requesting Confidential Treatment 1,702 8,687 1,217 23.19 Total for 644 Companies Not Shown Above 1/ 240 1,039 129 2.47 Total for all Reporting Carriers 6,366 38,492 $5,248 100.00 % 1/ Data are consolidated for affiliated carriers. A total of 718 companies made a total of 794 filings. Source: International Bureau, International Telecommunications Data (March 2006). 6 - 7 7 - 1 7 Lines Within the telephone industry there are several alternative, but closely related, definitions of telephone lines or loops. While these differences often make it difficult to reconcile data from different statistical series, they are not usually large enough to affect comparisons among companies or trends over time. Since 1970, over 90% of households and virtually all businesses have subscribed to telephone service. Until 2000, line growth over time, averaging about 3% per year, has historically reflected growth in the population and the economy. Since then, the number of lines provided by wireline carriers has declined, likely due to some consumers substituting wireless service for wireline service, and some households eliminating second lines when they move from dial-up Internet service to broadband service. Table 7.1 shows the nation's total number of telephone lines using three alternative measures. The first measure is the number of end-user switched access lines for both incumbent local exchange carriers (LECs) and competitive local exchange carriers (CLECs) as reported to the Commission on the FCC Form 477. These data undercount lines by a small amount because carriers with less than 10,000 lines in a state were not required to file the FCC Form 477 prior to September 2005. The second measure is the number of local loops, which is a way of counting lines that is used to determine the amount of high-cost universal service support provided to eligible telecommunications carriers. The number of local loops includes end-user access lines, lines resold to other carriers and UNE loops with switching (UNE-P). This measure excludes CLEC lines provided over their own facilities. The third measure, access lines, represents estimates for the whole incumbent LEC industry based on data filed with the Commission by large incumbent LECs through the Automated Reporting Management Information System (ARMIS). This measure excludes a substantial number of incumbent LEC lines provided to CLECs as UNE-P lines between 2001 and 2005. Table 7.2 shows the number of local exchange operating areas (study areas – company’s operations in one state) and loops in each state, and shows breakdowns by loops for price-cap and average-schedule companies. 1 Table 7.3 shows the number of loops by holding companies, and Chart 7.1 shows the five largest holding companies’ share of loops. Table 7.4 compares residential local loops with the number of households with telephone service. Before 2001, the difference between these series was an approximate measure of the number of non-primary residential lines. However, beginning in 2001, a significant number of households started replacing wireline service with wireless service, requiring an adjustment be made to account for wireless only households. Table 7.4 1 Average schedule companies have been permitted by the Commission to estimate their access settlements and universal service support through the use of average schedules to avoid the difficulties and expenses involved with conducting company-specific cost studies. 7 - 2 shows that the number of non-primary residential lines grew dramatically from 2.3 million in 1988 to 26.3 million in 2001 and then decreased back to 12.1 million in 2005. Tables 7.5 and 7.6 display payphone line information. Long distance carriers are required to pay payphone owners 49 cents for every completed dial-around call (calls where the consumer chooses the long distance carrier over the payphone’s presubscribed long distance carrier). 2 Because of this requirement, several long distance carriers employ the National Payphone Clearinghouse to administer payments on their behalf. On an annual basis, the National Payphone Clearinghouse 3 supplies the FCC with data that allow the number of payphones in each state to be calculated. Table 7.5 shows the number of payphones owned by LECs and by independent payphone operators in each state. The number of payphones is broken down by whether the payphones are served by an RBOC or by another LEC. Payphones located in RBOC territories but served by a CLEC are accounted for in the RBOC territories columns. Similarly, payphones located in non-RBOC territories (i.e., other incumbent LEC territories) but served by a CLEC are accounted for in the all other LEC territories columns. Data for earlier years can be found in earlier editions of Trends. Table 7.6 shows the number of payphones over time. The National Payphone Clearinghouse began providing detailed data to the Commission starting with data as of March 31, 1999. Where possible, data from the payphone proceedings were used to fill values for 1997 and 1998 (see the footnotes to Table 7.6 for citations). 2 See Report and Order, CC Docket 03-225, adopted Jul. 27, 2004. 3 Further information on the National Payphone Clearinghouse can be found at https://www.npc.cc/home.aspx. Table 7.1 U.S. Wireline Telephone Lines Year Annual ILEC Local Annual ILEC Access Annual End Growth Loops 2 Growth Lines 3 Growth (%) (%) (%) 1980 102,216,367 1981 105,559,222 3.3 % 1982 107,519,214 1.9 1983 110,612,689 2.9 1984 112,550,739 1.8 113,832,113 1985 115,985,813 3.1 117,384,865 3.1 % 1986 118,289,121 2.0 120,730,205 2.8 1987 122,789,249 3.8 124,625,693 3.2 1988 127,086,765 3.5 126,899,632 1.8 1989 131,504,568 3.5 130,860,026 3.1 1990 136,114,201 3.5 134,685,732 2.9 1991 139,412,884 2.4 139,613,309 3.7 1992 143,341,581 2.8 142,367,463 2.0 1993 148,106,159 3.3 147,033,132 3.3 1994 153,447,946 3.6 151,543,061 3.1 1995 159,658,662 4.0 158,152,644 4.4 1996 166,445,580 4.3 165,350,308 4.6 1997 173,866,799 4.5 173,857,193 5.1 1998 179,849,045 3.4 180,516,161 3.8 1999 189,397,096 185,002,911 2.9 186,594,497 3.4 2000 192,432,431 1.6 % 188,499,586 1.9 187,581,092 0.5 2001 191,570,800 -0.5 185,587,160 -1.5 179,811,283 -4.1 2002 189,250,143 -1.2 180,095,333 -3.0 172,265,210 -4.2 2003 182,933,281 -3.3 173,140,710 -3.9 161,376,638 -6.3 2004 177,690,711 -2.8 165,978,892 -4.1 154,590,517 -4.2 2005 175,160,940 -1.4 157,041,487 -5.4 147,661,287 -4.5 NA indicates not available. 1 Include end-user switched access lines for competitive local exchange carriers (CLECs) and incumbent local exchange carriers (ILECs) as reported in the FCC Form 477. Carriers with greater than 10,000 lines in a state were required to report. Beginning with June 2005 data, all LECs are required to report. 2 Include end-user switched access lines, resold lines, and UNE-P lines. 3 Beginning in 2001, a substantial number of ILEC lines provided to CLECs as UNE-P lines are not included in this total. Source: CLEC and ILEC access lines: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of December 31, 2005 (July 2006). Local loops: National Exchange Carrier Association, Universal Service Fund filings. Access Lines: Industry Analysis and Technology Division, Wireline Competition Bureau, Statistics of Communications Common Carriers, 2004/2005 Edition (November 2005), Table 4.10, after inflating access lines of reporting carriers to represent the total industry. The 1996 adjustment factor was used for the years prior to 1996. CLEC and ILEC Lines 1 7 - 3 Table 7.2 Telephone Loops of Incumbent Local Exchange Carriers by State (As of December 31, 2004) Price Cap Non-Price Cap Study Areas Bell Company Loops 1 Other Company Loops Average Schedule Company Loops 2 Other Company Loops Total Loops Alabama 28 1,774,375 303,390 30,407 168,438 2,276,610 Alaska 25 0 0 257 414,298 414,555 American Samoa 1 0 0 0 10,872 10,872 Arizona 17 2,373,565 163,593 0 40,099 2,577,257 Arkansas 28 919,866 0 13,072 438,922 1,371,860 California 22 20,913,376 155,267 0 216,393 21,285,036 Colorado 28 2,473,740 0 1,100 131,977 2,606,817 Connecticut 2 2,110,570 0 24,451 0 2,135,021 Delaware 1 546,439 0 0 0 546,439 District of Columbia 1 791,292 0 0 0 791,292 Florida 12 8,203,048 1,963,806 0 190,012 10,356,866 Georgia 36 3,727,530 27,079 62,014 795,313 4,611,936 Guam 1 0 0 0 67,059 67,059 Hawaii 2 0 664,194 0 1,292 665,486 Idaho 20 646,446 21,764 1,675 45,113 714,998 Illinois 57 6,957,443 121,350 37,143 207,504 7,323,440 Indiana 42 3,075,076 264,152 39,019 118,420 3,496,667 Iowa 154 985,834 317,015 186,037 51,742 1,540,628 Kansas 39 1,133,026 125,841 0 121,299 1,380,166 Kentucky 19 1,091,285 712,797 69,839 129,304 2,003,225 Louisiana 20 2,080,847 0 1,313 186,560 2,268,720 Maine 20 662,838 0 36,205 109,851 808,894 Maryland 2 3,598,762 0 0 7,504 3,606,266 Massachusetts 3 3,775,033 0 0 4,166 3,779,199 Michigan 39 5,469,022 23,055 26,342 169,672 5,688,091 Minnesota 88 1,887,050 412,486 218,642 183,846 2,702,024 Mississippi 19 1,232,062 6,344 10,502 78,965 1,327,873 Missouri 44 2,362,597 561,445 10,676 312,472 3,247,190 Montana 18 332,734 8,227 4,090 161,319 506,370 Nebraska 40 367,505 342,132 16,158 89,203 814,998 Nevada 14 406,963 827,523 0 33,198 1,267,684 New Hampshire 10 697,781 0 2,119 54,405 754,305 New Jersey 3 5,764,974 208,762 0 9,346 5,983,082 New Mexico 16 794,410 100,439 0 45,203 940,052 New York 44 10,176,986 832,018 20,706 254,708 11,284,418 North Carolina 26 2,577,077 1,303,738 231,355 484,377 4,596,547 North Dakota 23 179,077 0 58,158 110,496 347,731 Northern Mariana Islands 1 0 24,480 0 0 24,480 Ohio 42 4,605,609 1,340,446 53,923 372,099 6,372,077 Oklahoma 39 1,384,536 109,657 4,062 234,183 1,732,438 Oregon 33 1,697,012 70,446 10,367 155,849 1,933,674 Pennsylvania 36 6,092,636 412,664 590,334 249,516 7,345,150 Puerto Rico 2 0 0 0 1,180,127 1,180,127 Rhode Island 1 491,107 0 0 0 491,107 South Carolina 26 1,558,593 91,250 58,568 466,487 2,174,898 South Dakota 30 201,450 0 68,118 78,617 348,185 Tennessee 25 2,395,844 327,503 107,812 254,517 3,085,676 Texas 58 10,323,315 693,235 10,301 563,646 11,590,497 Utah 13 964,276 23,422 7,506 61,339 1,056,543 Vermont 10 342,946 0 4,636 59,620 407,202 Virgin Islands 1 0 0 0 69,425 69,425 Virginia 21 3,792,376 381,625 89,815 26,503 4,290,319 Washington 24 3,071,554 80,047 4,438 263,298 3,419,337 West Virginia 10 808,623 154,896 1,530 15,095 980,144 Wisconsin 90 2,227,852 68,246 201,347 591,442 3,088,887 Wyoming 10 238,015 6,621 0 44,416 289,052 Total 1,436 140,284,373 13,250,955 2,314,037 10,129,527 165,978,892 1 Includes loops owned by Verizon/GTE and SBC/Southern New England Telephone. Excludes Woodbury Telephone of Connecticut, affiliated with SBC, 24,451 average schedule company loops. Also excludes Puerto Rico Telephone Company, affiliated with Verizon, 1,180,127 rate of return lines. Source: NECA, Universal Service Fund 2006 Submission of 2005 Study Results (October 1, 2006). 2 Average schedule companies have been permitted by the Commission to estimate their access settlements and universal service support through the use of average schedules to avoid the difficulties and expenses involved with conducting company-specific cost studies. 7 - 4 Table 7.2 Telephone Loops of Incumbent Local Exchange Carriers by State - Continued (As of December 31, 2005) Price Cap Non-Price Cap Study Areas Bell Company Loops 1 Other Company Loops Average Schedule Company Loops 2 Other Company Loops Total Loops Alabama 28 1,709,853 288,069 29,708 168,672 2,196,302 Alaska 25 0 0 211 388,790 389,001 American Samoa 1 0 0 0 10,956 10,956 Arizona 17 2,216,212 163,210 0 40,134 2,419,556 Arkansas 28 883,340 0 12,853 417,045 1,313,238 California 22 20,245,343 151,856 0 213,694 20,610,893 Colorado 28 2,344,958 0 1,110 128,440 2,474,508 Connecticut 2 1,974,198 0 23,746 0 1,997,944 Delaware 1 530,802 0 0 0 530,802 District of Columbia 1 766,942 0 0 0 766,942 Florida 12 7,731,525 1,959,052 0 185,084 9,875,661 Georgia 36 3,564,080 25,108 58,708 768,802 4,416,698 Guam 1 0 0 0 65,044 65,044 Hawaii 2 0 631,169 0 1,469 632,638 Idaho 20 626,900 21,575 1,624 44,531 694,630 Illinois 57 6,594,221 115,886 35,831 198,525 6,944,463 Indiana 42 2,906,678 258,552 37,247 115,484 3,317,961 Iowa 154 933,367 302,364 182,088 50,407 1,468,226 Kansas 39 1,047,966 118,053 0 118,647 1,284,666 Kentucky 19 1,031,123 678,386 68,069 126,567 1,904,145 Louisiana 20 1,825,451 0 1,515 175,716 2,002,682 Maine 20 627,371 0 34,760 105,531 767,662 Maryland 2 3,476,006 0 0 7,382 3,483,388 Massachusetts 3 3,525,161 0 0 3,990 3,529,151 Michigan 39 4,894,189 23,708 25,439 161,964 5,105,300 Minnesota 88 1,770,985 402,267 212,522 180,155 2,565,929 Mississippi 19 1,156,946 5,965 9,981 77,861 1,250,753 Missouri 44 2,232,380 538,520 10,289 299,967 3,081,156 Montana 18 312,838 7,833 3,672 156,517 480,860 Nebraska 40 337,747 325,176 15,654 85,940 764,517 Nevada 14 399,371 815,986 0 33,276 1,248,633 New Hampshire 10 663,827 0 2,249 53,299 719,375 New Jersey 3 5,369,173 199,427 0 8,759 5,577,359 New Mexico 16 766,185 98,307 0 44,549 909,041 New York 44 9,183,646 784,606 20,071 241,968 10,230,291 North Carolina 26 2,392,828 1,267,826 225,040 477,225 4,362,919 North Dakota 22 168,655 0 55,838 108,174 332,667 Northern Mariana Islands 1 0 22,770 0 0 22,770 Ohio 42 4,240,488 1,237,113 52,711 356,846 5,887,158 Oklahoma 39 1,307,868 94,084 3,961 229,490 1,635,403 Oregon 33 1,624,737 68,536 10,356 151,512 1,855,141 Pennsylvania 36 5,817,302 403,209 572,331 241,198 7,034,040 Puerto Rico 2 0 0 0 1,158,243 1,158,243 Rhode Island 1 431,042 0 0 0 431,042 South Carolina 26 1,469,189 88,552 57,084 458,936 2,073,761 South Dakota 31 189,615 0 67,611 76,544 333,770 Tennessee 25 2,290,408 340,821 105,474 251,002 2,987,705 Texas 58 9,721,374 667,358 10,202 546,564 10,945,498 Utah 13 931,202 22,810 7,460 61,241 1,022,713 Vermont 10 333,854 0 4,583 59,166 397,603 Virgin Islands 1 0 0 0 68,956 68,956 Virginia 21 3,603,429 380,110 88,737 25,512 4,097,788 Washington 24 2,923,522 77,477 4,431 253,950 3,259,380 West Virginia 10 784,109 152,517 1,479 15,170 953,275 Wisconsin 90 2,051,195 66,428 193,894 566,338 2,877,855 Wyoming 10 223,079 6,531 0 43,819 273,429 Total 1,436 132,152,680 12,811,217 2,248,539 9,829,051 157,041,487 1 Includes loops owned by Verizon/GTE and SBC/Southern New England Telephone. Excludes Woodbury Telephone of Connecticut, affiliated with SBC, 23,746 average schedule company loops. Also excludes Puerto Rico Telephone Company, affiliated with Verizon, 1,158,243 rate of return lines. Source: NECA, Universal Service Fund 2006 Submission of 2005 Study Results (October 1, 2006). 2 Average schedule companies have been permitted by the Commission to estimate their access settlements and universal service support through the use of average schedules to avoid the difficulties and expenses involved with conducting company-specific cos 7 - 5 Holding Companies Loops Percent of Loops Verizon Communications, Inc. 52,494,623 31.63 % SBC Communications, Inc. 52,218,326 31.46 BellSouth Telecommunications, Inc. 21,979,758 13.24 Qwest Communications International, Inc. 14,820,724 8.93 Sprint Corporation 7,225,725 4.35 ALLTEL Corporation 2,780,622 1.68 CenturyTel, Inc. 2,302,107 1.39 Citizens Communications Company 2,179,804 1.31 Cincinnati Bell 901,415 0.54 Hawaiian Telecom Communications, Inc. 664,194 0.40 TDS Telecommunications Corporation 654,023 0.39 Valor Communications Group, Inc. 533,266 0.32 Commonwealth Telephone Enterprises, Inc. 320,200 0.19 Alaska Communications Systems 282,302 0.17 Iowa Network Services, Inc. 262,591 0.16 FairPoint Communications, Inc. 245,421 0.15 Consolidated Communications, Inc. 237,659 0.14 Madison River Telephone Company 170,985 0.10 Rock Hill Telephone Company 143,605 0.09 D&E Communications, Inc. 139,226 0.08 Surewest Communications 128,563 0.08 North State Communications Corporation 120,706 0.07 CT Communications, Inc. 114,414 0.07 Horry Telephone Cooperative, Inc. 92,845 0.06 North Pittsburgh Telephone Company 74,007 0.04 Hargray Communications Group, Inc. 73,536 0.04 Virgin Islands Telephone Corporation 69,425 0.04 Guam Telephone Authority 67,059 0.04 Matanuska Telephone Association, Inc. 60,832 0.04 Hickory Tech Corporation 58,757 0.04 Farmers Telephone Cooperative, Inc. (SC) 58,690 0.04 Pioneer Telephone Cooperative (OK) 53,484 0.03 Lynch Interactive Corporation 51,655 0.03 Ntelos, Inc. 46,380 0.03 Golden West Telecommunications Cooperative, Inc. 45,002 0.03 Atlantic Telephone Membership Corporation 41,578 0.03 Guadalupe Valley Telephone Cooperative, Inc. 40,817 0.02 SRT Services Corporation 40,561 0.02 East Ascension Telephone Company, LLC 38,742 0.02 Twin Lakes Telephone Cooperative Corporation 38,097 0.02 Otelco Holding, LLC 36,995 0.02 Skyline Telephone Membership Corporation 36,567 0.02 Ben Lomand 36,139 0.02 Horizon Telecom 35,415 0.02 All Other Companies 3,971,050 2.39 Total 165,987,892 100.00 % Source: NECA, Universal Service Fund 2006 Submission of 2005 Study Results (October 1, 2006). Table 7.3 Telephone Loops of Incumbent Local Exchange Carriers by Holding Company 1 1 Includes incumbent local exchange carriers' loops for holding companies with more than 35,000 loops. Five Largest Holding Companies' Share of Loops Chart 7.1 (As of December 31, 2004) SBC 31.5% BellSouth 13.2% Sprint 4.4% Verizon 31.6% Qwest 8.9% All Others 10.4% 7 - 6 Table 7.3 (As of December 31, 2005) Holding Companies Loops Percent of Loops Verizon Communications Inc. 49,317,413 31.40 % AT&T, Inc. 49,265,385 31.37 BellSouth Telecommunications, Inc. 20,703,775 13.18 Qwest Communications International, Inc. 14,048,096 8.95 Embarq Corporation 7,079,141 4.51 Windstream Corporation 3,168,810 2.02 CenturyTel, Inc. 2,194,202 1.40 Citizens Communications Company 2,097,812 1.34 Cincinnati Bell 833,013 0.53 TDS Telecommunications Corporation 637,989 0.41 Hawaiian Telecom Communications, Inc. 631,169 0.40 Commonwealth Telephone Enterprises, Inc. 311,204 0.20 Alaska Communications Systems 258,860 0.16 Iowa Network Services, Inc. 250,067 0.16 FairPoint Communications, Inc. 241,039 0.15 Consolidated Communications, Inc. 228,842 0.15 Madison River Telephone Company 171,711 0.11 Rock Hill Telephone Company 142,014 0.09 D&E Communications, Inc. 133,995 0.09 Surewest Communications 125,742 0.08 North State Communications Corporation 116,484 0.07 CT Communications, Inc. 111,637 0.07 Horry Telephone Cooperative, Inc. 91,435 0.06 Hargray Communications Group, Inc. 74,319 0.05 North Pittsburgh Telephone Company 71,992 0.05 Virgin Island Telephone Company 68,956 0.04 Guam Telephone Authority 65,044 0.04 Matanuska Telephone Association, Inc. 61,130 0.04 Famers Telephone Cooperative, Inc. (SC) 57,061 0.04 Hickory Tech Corporation 55,213 0.04 Lynch Interactive Corporation 53,146 0.03 Pioneer Telephone Cooperative (OK) 53,036 0.03 Ntelos, Inc. 44,419 0.03 Golden West Telecommunications Cooperative, Inc. 42,907 0.03 Atlantic Telephone Membership Corporation 42,429 0.03 Guadalupe Valley Telephone Cooperative, Inc. 41,023 0.03 SRT Services Corporation 38,847 0.02 East Ascension Telephone Company, LLC 37,871 0.02 Twin Lake Telephone Cooperative Corporation 37,425 0.02 Skyline Telephone Membership Corporation 36,207 0.02 Otelco Holding, LLC 36,050 0.02 Ben Lomand 35,410 0.02 All Other Companies 3,929,167 2.50 Total 157,041,487 100.00 % Source: NECA, Universal Service Fund 2006 Submission of 2006 Study Results (October 1, 2006). Telephone Loops of Incumbent Local Exchange Carriers by Holding Company Continued - Continued 1 1 Includes incumbent local exchange carriers' loops for holding companies with more than 35,000 loops. Five Largest Holding Companies' Share of Loops Chart 7.1: Continued AT&T Inc. 31.4% BellSouth 13.2% Embarq 4.5% Verizon 31.4% Qwest 8.9% All Others 10.6% 7 - 7 Table 7.4 Additional Residential Lines For Households with Telephone Service (End-of-Year Data in Millions) Wireline Loops 1 Households Households Primary Non-Primary with with Residential Residential Residential Non- Total Telephone Wireless Lines Lines Residential Loops Service 2 Only 3 87.7 38.5 126.2 85.4 85.4 2.3 90.0 40.6 130.6 87.4 87.4 2.6 92.2 42.9 135.1 88.4 88.4 3.9 95.9 42.5 138.4 89.4 89.4 6.5 99.3 43.0 142.3 91.0 91.0 8.3 101.8 45.2 147.0 93.0 93.0 8.8 105.1 47.2 152.3 93.7 93.7 11.4 108.1 50.4 158.5 94.2 94.2 13.9 111.1 54.3 165.4 95.1 95.1 16.0 114.7 58.2 172.9 96.5 96.5 18.2 117.1 62.6 179.8 98.0 98.0 19.1 122.7 63.5 186.2 99.1 99.1 23.6 126.4 65.8 192.2 100.2 100.2 26.2 127.3 62.8 190.1 102.2 1.2 101.0 26.3 120.5 64.6 185.1 104.0 1.8 102.2 18.4 2003 118.1 60.6 178.8 107.1 5.0 102.1 16.0 2004 113.9 59.2 173.1 106.4 6.3 100.1 13.8 2005 107.8 58.0 165.8 107.0 11.3 95.6 12.1 1 Loop counts provided by the National Exchange Carrier Association. American Samoa, Guam, the Northern Mariana Islands, Puerto Rico, and the U.S. Virgin Islands totals have been removed. Total loops were divided between residential and non-residential using the ratio of residential to non-residential access lines reported in Industry Analysis and Technology Division, Wireline Competition Bureau, Statistics of Communications Common Carriers . Those totals also exclude Puerto Rico, but cover only the carriers that file ARMIS reports (of which there are none for American Samoa, Guam, the Northern Mariana Islands, and the U.S. Virgin Islands). Loop counts beginning in 1996 have been increased by estimated competitive local exchange carrier lines from the Association for Local Telecommunications Services (now known as Comptel/ALTS) and the report by the Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Beginning in 2001 a significant number of households began to have wireless service. The estimate of this amount for 2001 is from the November 2001 Currently Population Survey. Beginning in 2002, the numbers of primary and non-primary residential lines for households with telephones was estimated using the ratio of primary (Lifeline and Non-Lifeline) to non- primary residential access lines reported in Table 2.4 of Statistics of Communications Common Carriers, and the estimate of wireless-only is based on the difference between households with phone service and estimated primary residential lines. 2 Current Population Survey (U.S. Department of Commerce, U.S. Census Bureau). 3 Because the number of households with wireless only is calculated as a difference between households with telephone service and primary residential lines, this estimate may include some VoIP customers not included in the Local Telephone Competition report. Source: FCC staff estimates. Year 1988 1989 1990 1991 1992 1993 1994 1995 2000 2001 2002 1996 1997 1998 1999 7 - 8 Table 7.5 Number of Payphones Owned by LECs and Independent Operators (As of March 31, 2005) RBOC Territories All Other LEC Territories Grand State LEC-Owned Independent LEC-Owned Independent LEC-Owned Independent Total Alabama 0 7,435 1,264 767 1,264 8,202 9,466 Alaska 0 0 2,416 1,275 2,416 1,275 3,691 Arizona 1,861 20,154 735 1,206 2,596 21,360 23,956 Arkansas 7,040 1,002 1,834 889 8,874 1,891 10,765 California 88,125 82,380 1,336 656 89,461 83,036 172,497 Colorado 3,280 14,051 218 520 3,498 14,571 18,069 Connecticut 13,402 2,488 130 3 13,532 2,491 16,023 Delaware 2,848 739 0 0 2,848 739 3,587 District of Columbia 4,543 856 0 0 4,543 856 5,399 Florida 9,682 32,007 6,616 5,767 16,298 37,774 54,072 Georgia 0 17,111 2,895 2,507 2,895 19,618 22,513 Hawaii 5,454 551 0 0 5,454 551 6,005 Idaho 999 2,750 244 131 1,243 2,881 4,124 Illinois 39,532 18,080 662 821 40,194 18,901 59,095 Indiana 17,270 5,840 1,558 888 18,828 6,728 25,556 Iowa 814 5,730 680 854 1,494 6,584 8,078 Kansas 6,175 1,725 632 566 6,807 2,291 9,098 Kentucky 0 5,819 2,911 3,295 2,911 9,114 12,025 Louisiana 0 9,622 282 814 282 10,436 10,718 Maine 3,792 439 32 372 3,824 811 4,635 Maryland 21,073 6,455 0 8 21,073 6,463 27,536 Massachusetts 22,493 8,262 5 2 22,498 8,264 30,762 Michigan 29,070 11,490 670 475 29,740 11,965 41,705 Minnesota 1,601 10,186 1,759 937 3,360 11,123 14,483 Mississippi 110 5,674 133 178 243 5,852 6,095 Missouri 12,904 3,939 2,924 2,695 15,828 6,634 22,462 Montana 707 2,342 447 482 1,154 2,824 3,978 Nebraska 568 2,926 2,966 689 3,534 3,615 7,149 Nevada 2,109 1,285 2,642 6,842 4,751 8,127 12,878 New Hampshire 3,524 1,308 140 34 3,664 1,342 5,006 New Jersey 39,126 14,422 1,185 146 40,311 14,568 54,879 New Mexico 1,004 5,608 204 670 1,208 6,278 7,486 New York 78,851 38,765 7,757 1,760 86,608 40,525 127,133 North Carolina 1,072 10,250 5,779 7,356 6,851 17,606 24,457 North Dakota 229 721 96 153 325 874 1,199 Ohio 27,555 8,068 7,555 3,284 35,110 11,352 46,462 Oklahoma 9,785 3,306 1,281 654 11,066 3,960 15,026 Oregon 2,834 9,860 595 918 3,429 10,778 14,207 Pennsylvania 29,690 14,940 5,915 2,273 35,605 17,213 52,818 Rhode Island 3,001 2,118 0 0 3,001 2,118 5,119 South Carolina 828 9,167 1,251 1,851 2,079 11,018 13,097 South Dakota 559 1,636 299 184 858 1,820 2,678 Tennessee 0 10,695 1,962 1,572 1,962 12,267 14,229 Texas 46,671 34,897 1,905 4,112 48,576 39,009 87,585 Utah 1,092 5,979 182 461 1,274 6,440 7,714 Vermont 1,878 263 44 147 1,922 410 2,332 Virginia 21,139 9,564 1,862 1,182 23,001 10,746 33,747 Washington 4,851 17,134 448 1,287 5,299 18,421 23,720 West Virginia 5,478 898 622 435 6,100 1,333 7,433 Wisconsin 11,996 3,747 3,604 1,401 15,600 5,148 20,748 Wyoming 758 1,700 138 84 896 1,784 2,680 Totals 587,373 486,384 78,815 63,603 666,188 549,987 1,216,175 Source: Raw data provided by National Payphone Clearinghouse. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. Statewide 7 - 9 Table 7.5 Number of Payphones Owned by LECs and Independent Operators - Continued (As of March 31, 2006) RBOC Territories All Other LEC Territories Grand State LEC-Owned Independent LEC-Owned Independent LEC-Owned Independent Total Alabama 0 7,250 120 755 120 8,005 8,125 Alaska 0 0 2,333 1,158 2,333 1,158 3,491 Arizona 804 18,266 734 1,179 1,538 19,445 20,983 Arkansas 4,656 957 406 279 5,062 1,236 6,298 California 64,191 76,984 980 1,113 65,171 78,097 143,268 Colorado 1,383 11,993 29 87 1,412 12,080 13,492 Connecticut 8,797 2,134 0 4 8,797 2,138 10,935 Delaware 1,977 1,390 0 0 1,977 1,390 3,367 District of Columbia 4,265 777 0 0 4,265 777 5,042 Florida 5,938 30,908 5,518 5,119 11,456 36,027 47,483 Georgia 0 15,500 380 1,099 380 16,599 16,979 Hawaii 0 0 5,315 475 5,315 475 5,790 Idaho 639 2,296 227 100 866 2,396 3,262 Illinois 25,359 16,046 633 1,301 25,992 17,347 43,339 Indiana 12,150 5,641 1,413 836 13,563 6,477 20,040 Iowa 138 4,919 587 814 725 5,733 6,458 Kansas 3,976 1,627 531 508 4,507 2,135 6,642 Kentucky 0 5,790 1,036 1,359 1,036 7,149 8,185 Louisiana 0 7,855 0 124 0 7,979 7,979 Maine 3,430 613 80 409 3,510 1,022 4,532 Maryland 17,153 7,623 0 8 17,153 7,631 24,784 Massachusetts 20,168 8,679 0 0 20,168 8,679 28,847 Michigan 18,498 10,631 230 186 18,728 10,817 29,545 Minnesota 354 8,443 1,408 848 1,762 9,291 11,053 Mississippi 111 5,124 39 115 150 5,239 5,389 Missouri 7,768 3,786 1,030 1,427 8,798 5,213 14,011 Montana 254 1,968 321 300 575 2,268 2,843 Nebraska 102 2,064 388 375 490 2,439 2,929 Nevada 1,091 1,244 2,375 5,873 3,466 7,117 10,583 New Hampshire 3,252 1,255 132 55 3,384 1,310 4,694 New Jersey 34,272 15,324 1,038 96 35,310 15,420 50,730 New Mexico 263 5,065 204 697 467 5,762 6,229 New York 78,568 34,449 7,063 1,368 85,631 35,817 121,448 North Carolina 972 9,575 4,972 6,609 5,944 16,184 22,128 North Dakota 23 637 96 157 119 794 913 Ohio 17,938 7,613 5,128 2,206 23,066 9,819 32,885 Oklahoma 6,264 2,918 977 609 7,241 3,527 10,768 Oregon 1,173 9,528 387 631 1,560 10,159 11,719 Pennsylvania 27,092 14,188 5,345 1,633 32,437 15,821 48,258 Rhode Island 2,548 1,857 0 0 2,548 1,857 4,405 South Carolina 763 8,443 966 1,337 1,729 9,780 11,509 South Dakota 124 1,459 294 188 418 1,647 2,065 Tennessee 0 10,437 1,637 1,626 1,637 12,063 13,700 Texas 31,752 33,762 1,121 3,321 32,873 37,083 69,956 Utah 465 4,903 182 351 647 5,254 5,901 Vermont 1,783 270 45 137 1,828 407 2,235 Virginia 18,573 9,578 1,763 1,155 20,336 10,733 31,069 Washington 3,062 15,272 261 399 3,323 15,671 18,994 West Virginia 4,987 1,003 580 390 5,567 1,393 6,960 Wisconsin 7,491 3,497 741 766 8,232 4,263 12,495 Wyoming 82 1,742 152 91 234 1,833 2,067 Totals 444,649 453,283 59,197 49,673 503,846 502,956 1,006,802 Source: Raw data provided by National Payphone Clearinghouse. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. Statewide 7 - 10 All Other LECs' Territories Grand Year LEC-Owned Independent Total LEC Owned Independent Total LEC Owned Independent Total 1997 1,399,600 1 NA NA NA NA NA NA NA 2,086,540 2 1998 1,381,800 1 NA NA NA NA NA NA NA 2,100,558 2 1999 1,305,463 572,503 1,877,966 80,491 163,069 243,560 1,385,954 735,572 2,121,526 2000 1,244,535 633,022 1,877,557 63,808 122,353 186,161 1,308,343 755,375 2,063,718 2001 1,131,377 571,778 1,703,155 88,399 128,086 216,485 1,219,776 699,864 1,919,640 2002 964,999 531,801 1,496,800 95,639 118,622 214,261 1,060,638 650,423 1,711,061 2003 854,295 464,479 1,318,774 75,885 101,127 177,012 930,180 565,606 1,495,786 2004 737,146 455,506 1,192,652 78,642 73,705 152,347 815,788 529,211 1,344,999 2005 587,373 486,384 1,073,757 78,815 63,603 142,418 666,188 549,987 1,216,175 2006 444,649 453,283 897,932 59,197 49,673 108,870 503,846 502,956 1,006,802 NA - Not Available. Table 7.6 Number of Payphones Over Time (As of March 31 of Each Year) Source: Unless otherwise noted, raw data provided by National Payphone Clearinghouse. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. 1 See RBOC/GTE/SNET Payphone Coalition Comments on Remand Issues in CC Docket No. 96-128, Report of Arthur Andersen on Per-Call Compensation, Carl R. Geppert at 10 (July 13, 1998). 2 See Letter from Denny Reuss, NPC Product Manager, to Craig Stroup, Federal Communications Commission, CC Docket 96-128 at 1 (Filed October 22, 1998. The 1997 data point is as of June 30, 1997.) RBOCs' Territories Total 7 - 11 8 - 1 8 Local Telephone Competition For most of the past century, households and businesses had no choice in selecting their local telephone company. In the 1980s, competitive access providers (CAPs) began to market to business customers access services provided over CAPs’ wired networks. To some extent they also carried local telephone calls among their customers. In the 1990s, some CAPs and other companies, including affiliates of cable television companies and local service divisions of long distance companies, began to offer local telephone services to a broader range of customers. Companies with operations in larger cities added operations in smaller cities, where the typical customer is more likely to be a small or medium-sized business than a large business, and some new companies focused on smaller cities from the beginning. The newer competitors are often called competitive local exchange carriers (CLECs), although the terms CAPs and CLECs are sometimes used interchangeably. The Telecommunications Act of 1996 (1996 Act) contemplated three vehicles for competitors to enter local telephone service markets. First, CLECs may resell the services of incumbent local exchange carriers (LECs). Second, CLECs may make use of incumbent LEC facilities, for example, by leasing incumbent LEC unbundled network elements (UNEs) loops and transport. Third, CLECs may build the complete set of facilities they need to compete. Individual competitors have used various combinations of these methods at different times. 1. CLEC Share of Switched Access Lines All incumbent LECs and CLECs were required to report to the Commission basic information about their local telephone service, as of June 30, 2005. The FCC previously (i.e., as of December 31, 1999 and each succeeding June 30 and December 31 through the end of 2004) collected data from carriers with at least 10,000 switched access lines in service in a particular state. Small carriers, many of whom serve rural areas with relatively small populations, were therefore underrepresented in the earlier data. 1 Table 8.1 and the associated chart show the number of incumbent LEC and CLEC end-user switched access lines from December 1999 through June 2006. Table 8.2 and the associated chart show the relative shares of the residential end-user switched access lines provisioned by incumbent LECs and CLECs from December 1999 through June 2006. 1 As of December, 2005, filers with fewer than 10,000 switched access lines in a state (including entities that previously filed on a voluntary basis) reported about 4.5 million lines (about 2.0 million incumbent LEC lines and about 2.5 million CLEC lines). 8 - 2 Table 8.3 shows the percentages of CLEC end-user lines that were provisioned over their own facilities and those lines acquired from unaffiliated carriers from December 1999 through June 2006. Chart 8.3 displays that information graphically for June 2006. Data reported by incumbent LECs, presented in Table 8.4, show the lines that incumbent LECs provided to other carriers as UNE loops provided with incumbent LEC switching (including the UNE-platform), UNE loops provided without switching, and resale. Chart 8.4 shows the trend, from December 1997 through June 2006, of incumbent LEC total switched access lines and the percentages provided to other carriers. Table 8.5 shows incumbent LEC and CLEC end-user switched access lines by state, and the CLEC share by state, at the end of June 2006. Table 8.6 presents historical data on CLEC share by state. 2. CLEC Share of Local Telephone Service Revenues As discussed in Section 15, the Commission has been collecting revenue data from local exchange carriers since 1993. Table 8.7 shows CLEC and incumbent LEC local telephone service revenues from 1993 through 2004. Chart 8.5 shows the incumbent LEC and CLEC shares of local service revenues from 1998 through 2004. 3. Ported Telephone Numbers When telecommunications customers switch service providers, they have the option of taking their local telephone number with them. This is called porting. All ported numbers reside in one of seven regional databases. These databases contain several elements of information about ported numbers, including identifiers for the old and new carriers, and the date the number was ported. The porting databases are overseen by the local number portability administrator, currently NeuStar, Inc. NeuStar provides the FCC with two sets of information on ported numbers. The first set of information is a rollup of the quantity of telephone numbers that were ported each month. This information forms the basis for Table 8.8. Unlike Tables 8.9 and 8.10 (see footnote 2 in Table 8.10), these figures include instances where the customer ports the number back to the original carrier. The second set of information that the FCC receives from NeuStar on a monthly basis is a current list of all ported numbers where the customer changed carriers. For each number, the list includes identifiers for the old and new carriers for that number, and the date the number was ported. In order to protect consumer privacy, the Commission receives the information in a manner that prevents it from determining if any particular telephone number has been ported. This information forms the basis for Tables 8.9 and 8.10. 8 - 3 Table 8.9 shows the quantities of ports in the porting databases at the end of each quarter. The ports are broken out by service type: from landline to landline, landline to mobile, mobile to mobile, or mobile to landline. Table 8.10 examines the ports in the databases as of June 30, 2006. It shows, by service type, when each number in the database was ported. Date ILEC Lines CLEC Lines Total Dec 1999 181,202,853 8,194,243 189,397,096 4.3 % Jun 2000 179,648,725 11,557,381 191,206,106 6.0 Dec 2000 177,561,022 14,871,409 192,432,431 7.7 Jun 2001 174,752,275 17,274,727 192,027,002 9.0 Dec 2001 171,917,359 19,653,441 191,570,800 10.3 Jun 2002 167,330,006 21,644,928 188,974,934 11.5 Dec 2002 164,386,452 24,863,691 189,250,143 13.1 Jun 2003 158,274,538 26,985,345 185,259,883 14.6 Dec 2003 153,157,843 29,775,438 182,933,281 16.3 Jun 2004 147,993,218 32,033,915 180,027,133 17.8 Dec 2004 144,809,899 32,880,812 177,690,711 18.5 Jun 2005 143,757,708 33,975,336 177,733,044 19.1 Dec 2005 143,773,101 31,387,839 175,160,940 17.9 Jun 2006 142,249,668 29,782,241 172,031,909 17.3 (Lines in Millions) CLEC Share Table 8.1 End-User Switched Access Lines Reported Only LECs with at least 10,000 lines in a state were required to report through December 2004. Beginning with the June 2005 data all LECs are required to report. Some data have been revised for June and December 2005. End-User Switched Access Lines Reported Chart 8.1 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). 0 20 40 60 80 100 120 140 160 180 200 ILEC Lines CLEC lines CLEC lines 8.2 11.6 14.9 17.3 19.7 21.6 24.9 27.0 29.8 32.0 32.9 34.0 31.4 29.8 ILEC Lines 181.2 179.6 177.6 174.8 171.9 167.3 164.4 158.3 153.2 148.0 144.8 143.8 143.8 142.2 Dec 1999 Jun 2000 Dec 2000 Jun 2001 Dec 2001 Jun 2002 Dec 2002 Jun 2003 Dec 2003 Jun 2004 Dec 2004 Jun 2005 Dec 2005 Jun 2006 8 - 5 Dec 1999 139,694,481 41,508,372 77.1 % 3,368,702 4,825,541 41.1 % Jun 2000 140,566,144 39,082,581 78.2 4,579,501 6,977,880 39.6 Dec 2000 138,824,111 38,736,911 78.2 6,620,471 8,250,938 44.5 Jun 2001 134,530,884 40,221,391 77.0 7,793,071 9,481,656 45.1 Dec 2001 133,320,119 38,597,240 77.5 9,489,049 10,164,392 48.3 Jun 2002 130,937,328 36,392,678 78.3 11,080,676 10,564,252 51.2 Dec 2002 127,494,698 36,891,754 77.6 14,608,495 10,255,196 58.8 Jun 2003 122,573,530 35,701,008 77.4 16,770,561 10,214,784 62.1 Dec 2003 118,658,867 34,498,976 77.5 18,702,229 11,073,209 62.8 Jun 2004 114,533,368 33,459,850 77.4 20,871,756 11,162,159 65.2 Dec 2004 112,054,420 32,755,479 77.4 19,811,711 13,069,101 60.3 Jun 2005 95,315,689 48,442,019 66.3 16,338,117 17,637,219 48.1 Dec 2005 94,392,526 49,380,575 65.7 13,873,331 17,514,508 44.2 Jun 2006 92,414,935 49,834,733 65.0 12,372,950 17,409,291 41.5 1 Included small business lines through December 2004. 2 Excluded small business lines through December 2004. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Table 8.2 End-User Switched Access Lines by Customer Type Reporting CLECsReporting ILECs Date Percent of Lines That Serve Residential Customers 1 Chart 8.2 Only LECs with at least 10,000 lines in a state were required to report through December 2004. Beginning with the June 2005 data all LECs are required to report. Some data have been revised for June and December 2005. % Residential Business 2 Business 2 Residential 1 % Residential Residential 1 0% 10% 20% 30% 40% 50% 60% 70% 80% ILECs CLECs ILECs 77.1% 78.2% 78.2% 77.0% 77.5% 78.3% 77.6% 77.4% 77.5% 77.4% 77.4% 66.3% 65.7% 65.0% CLECs 41.1% 39.6% 44.5% 45.1% 48.3% 51.2% 58.8% 62.1% 62.8% 65.2% 60.3% 48.1% 44.2% 41.5% Dec 1999 Jun 2000 Dec 2000 Jun 2001 Dec 2001 Jun 2002 Dec 2002 Jun 2003 Dec 2003 Jun 2004 Dec 2004 Jun 2005 Dec 2005 Jun 2006 8 - 6 CLEC- Owned 81 8,194 3,513 1,959 2,723 42.9% 23.9% 33.2% 78 11,557 4,315 3,201 4,042 37.3 27.7 35.0 89 14,871 4,114 5,540 5,217 27.7 37.3 35.1 91 17,275 3,919 7,580 5,776 22.7 43.9 33.4 94 19,653 4,250 9,332 6,072 21.6 47.5 30.9 96 21,645 4,478 10,930 6,236 20.7 50.5 28.8 112 24,864 4,677 13,709 6,479 18.8 55.1 26.1 125 26,985 4,887 15,728 6,370 18.1 58.3 23.6 136 29,775 4,842 17,888 7,045 16.3 60.1 23.7 137 32,034 4,927 19,624 7,483 15.4 61.3 23.4 149 32,881 5,417 18,961 8,503 16.5 57.7 25.9 326 33,975 5,826 19,025 9,124 17.1 56.0 26.9 382 31,388 6,704 14,521 10,163 21.4 46.3 32.4 399 29,782 6,549 12,546 10,687 22.0 42.1 35.9 2 Lines provided over CLEC-owned "last-mile" facilities. UNEs 1 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Lines 2 Resold UNEs CLEC- Owned Dec 2000 Jun 2001 Dec 2001 Dec 2003 Date CLECs Reporting Total End- User Lines Resold Lines Chart 8.3 Competitive Local Exchange Carriers' End-User Lines Dec 2004 Jun 2004 Jun 2006 Only LECs with at least 10,000 lines in a state were required to report through December 2004. Beginning with the June 2005 data all LECs are required to report. Figures may not add to totals due to rounding. Some data have been revised for June and December 2005. 1 Includes unbundled network element (UNE) loops leased from an unaffiliated carrier on a stand-alone basis and also UNE loops leased in combination with UNE switching or any other unbundled network element. Jun 2005 Dec 2005 Table 8.3 Reporting Competitive Local Exchange Carriers (End-User Switched Access Lines in Thousands) Jun 2003 Dec 1999 Percent Jun 2000 Dec 2002 Jun 2002 Acquired from Other Carriers Resold 22.0% UNEs 42.1% CLEC-Owned 35.9% 8 - 7 Dec 1997 9 159,008 157,132 133 1,876 1.2 % Jun 1998 8 161,810 159,118 244 2,692 1.7 Dec 1998 7 164,614 161,191 361 3,423 2.1 Jun 1999 7 167,177 162,909 685 4,268 2.6 Dec 1999 168 187,190 181,203 1,493 5,987 3.2 Jun 2000 159 188,058 179,649 3,312 8,409 4.5 Dec 2000 166 188,223 177,561 5,274 10,662 5.7 Jun 2001 156 187,092 174,752 7,922 12,340 6.6 Dec 2001 164 185,391 171,917 9,460 13,474 7.3 Jun 2002 166 182,345 167,330 11,540 15,015 8.2 Dec 2002 174 181,616 164,386 14,487 17,229 9.5 Jun 2003 181 177,770 158,275 17,263 19,495 11.0 Dec 2003 185 174,453 153,158 19,463 21,296 12.2 Jun 2004 185 171,050 147,993 21,458 23,057 13.5 Dec 2004 190 167,063 144,810 20,763 22,253 13.3 Jun 2005 757 164,449 143,758 18,895 20,691 12.6 Dec 2005 807 160,881 143,773 15,315 17,108 10.6 Jun 2006 804 156,828 142,250 12,856 14,579 9.3 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Total UNEs 4,217 16,546 15,176 2,743 Without Switching With Switching 1,723 4,413 8,443 4,227 13,036 4,300 14,596 1,793 1 Data prior to December 1999 are from Common Carrier Bureau voluntary surveys. Only LECs with at least 10,000 lines in a state were required to report data for December 1999 through December 2004, after which all LECs are required to report. Figures may not add to totals due to rounding. Some data for December 2005 have been revised. 1,833 4,287 4,322 17,136 1,600 1,490 4,469 10,846 Chart 8.4 ILEC Lines and the Percent Provided to Other Carriers Dec 1997 - Jun 1999 Dec 1999 - Jun 2006 Voluntary Reporting Mandatory Reporting 3,679 5,781 4,259 10,227 7,478 3,475 4,061 4,417 4,494 1,004 489 3,161 4,761 1,696 1,616 2,436 2,838 3,583 1,743 2,448 End-User Lines Resold Lines 3,062 5,098 1,796 2,232 4,014 5,388 Table 8.4 Reporting Incumbent Local Exchange Carriers (Switched Access Lines in Thousands) UNEs Provided to Other Carriers Percent of Total Lines Total UNEs & Resold Lines Date 1 ILECs Reporting Total Lines 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 Dec 1997 Jun 1998 Dec 1998 Jun 1999 Dec 1999 Jun 2000 Dec 2000 Jun 2001 Dec 2001 Jun 2002 Dec 2002 Jun 2003 Dec 2003 Jun 2004 Dec 2004 Jun 2005 Dec 2005 Jun 2006 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% Total ILEC Lines Percent of Total Lines Provided to Other Carriers 8 - 8 State ILECs CLECs Total Alabama 1,978,871 365,944 2,344,815 16 % Alaska 324,892 116,432 441,324 26 American Samoa 11,008 0 11,008 0 Arizona 2,226,531 970,453 3,196,984 30 Arkansas 1,192,839 162,525 1,355,364 12 California 19,479,382 2,900,279 22,379,661 13 Colorado 2,276,358 528,727 2,805,085 19 Connecticut 1,928,048 261,681 2,189,729 12 Delaware 467,676 101,513 569,189 18 District of Columbia 891,832 144,600 1,036,432 14 Florida 9,013,194 1,617,538 10,630,732 15 Georgia 3,843,615 909,236 4,752,851 19 Guam 67,721 0 67,721 0 Hawaii 608,403 60,696 669,099 9 Idaho 666,382 80,698 747,080 11 Illinois 6,354,337 1,139,239 7,493,576 15 Indiana 3,079,875 338,113 3,417,988 10 Iowa 1,302,210 229,603 1,531,813 15 Kansas 1,100,313 346,533 1,446,846 24 Kentucky 1,732,044 337,265 2,069,309 16 Louisiana 1,800,472 394,199 2,194,671 18 Maine 692,360 134,610 826,970 16 Maryland 3,166,012 590,557 3,756,569 16 Massachusetts 3,075,544 978,953 4,054,497 24 Michigan 4,490,783 992,598 5,483,381 18 Minnesota 2,273,378 675,623 2,949,001 23 Mississippi 1,089,448 161,058 1,250,506 13 Missouri 2,841,990 425,768 3,267,758 13 Montana 460,058 61,726 521,784 12 Nebraska 661,351 244,058 905,409 27 Nevada 1,233,166 245,553 1,478,719 17 New Hampshire 624,466 195,539 820,005 24 New Jersey 4,784,134 993,630 5,777,764 17 New Mexico 865,466 76,512 941,978 8 New York 8,285,874 3,043,468 11,329,342 27 North Carolina 4,059,971 695,429 4,755,400 15 North Dakota 271,969 68,351 340,320 20 Northern Mariana Islands 21,313 0 21,313 0 Ohio 5,367,588 951,812 6,319,400 15 Oklahoma 1,472,856 361,715 1,834,571 20 Oregon 1,627,341 305,519 1,932,860 16 Pennsylvania 6,385,263 1,572,224 7,957,487 20 Puerto Rico 1,035,002 * * * Rhode Island 362,993 275,526 638,519 43 South Carolina 1,907,925 329,943 2,237,868 15 South Dakota 279,589 135,275 414,864 33 Tennessee 2,675,649 575,957 3,251,606 18 Texas 9,958,460 1,905,521 11,863,981 16 Utah 915,178 281,796 1,196,974 24 Vermont 369,731 49,094 418,825 12 Virgin Islands 69,272 * * * Virginia 3,818,918 1,046,894 4,865,812 22 Washington 2,993,977 506,360 3,500,337 14 West Virginia 852,152 117,009 969,161 12 Wisconsin 2,669,652 611,912 3,281,564 19 Wyoming 244,836 39,443 284,279 14 Nationwide 142,249,668 29,782,241 172,031,909 17 % * Data withheld to maintain firm confidentiality. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). CLEC Share Table 8.5 End-User Switched Access Lines Served by Reporting Local Exchange Carriers (As of June 30, 2006) 8 - 9 2005 Alabama 3 % 4 % 5 % 5 % 5 % 9 % 11 % 13 % 15 % 16 % 16 15 % 16 % Alaska ***** *******2 American Samoa NA NA NA NA NA NA NA NA NA NA 0 0 0 Arizona 55791 1216225252733 Arkansas ***** 10*11113112 California 56789 1113567833 Colorado 7 9 10 13 14 15 16 17 17 16 17 20 19 Connecticut 56779 9101011314112 Delaware * * 0 0 * * 9 12 16 16 20 20 18 District of Columbia 7 9 12 13 16 14 16 17 19 19 20 17 14 Florida 667791313141616161715 Georgia 6 8 10 11 13 15 17 18 19 20 21 18 19 Guam NA NA NA NA NA NA NA NA NA NA NA 0 0 Hawaii * 0 ********679 Idaho 0 *****567710101 Illinois 7 9 13 15 17 19 19 20 21 22 20 15 15 Indiana 4555789131413141010 Iowa 9 11 11 12 12 13 13 13 14 14 14 14 15 Kansas 5789 7222225224 Kentucky * 3 * * * 4 5 8 11 11 14 15 16 Louisiana 2344579101214191718 Maine ******8 4820206 Maryland 346467101416118181 Massachusetts 8 11 12 15 16 16 18 21 23 25 25 25 24 Michigan 5 6 9 13 18 21 22 25 26 26 25 19 18 Minnesota 7 9 11 13 14 17 17 19 20 21 21 24 23 Mississippi * 44326791010141213 Missouri 5667810101 33 Montana ******344481012 Nebraska * * * 12 16 18 20 21 22 25 25 26 27 Nevada * * 10 * * 11 9 10 11 11 13 13 17 New Hampshire * 6 8 10 13 14 16 17 20 23 25 25 24 New Jersey 45456059 117 New Mexico ********88878 New York 16 20 23 25 25 24 27 28 30 30 30 31 27 North Carolina 44666899113131515 North Dakota *******88720920 Northern Mariana Isl. NA NA NA NA NA NA NA NA NA NA NA 0 0 Ohio 4445791141515151515 Oklahoma * 5 6 8 10 11 11 14 13 16 18 18 20 Oregon 3457798121316131916 Pennsylvania 8 10 13 14 15 16 17 19 20 22 23 23 20 Puerto Rico ************* Rhode Island * * 10 16 18 21 25 28 32 35 40 42 43 South Carolina * 4435799101131315 South Dakota ******1418**0 3 Tennessee 6688790 1415161718 Texas 7 13 14 16 16 17 18 18 19 19 19 16 16 Utah 6 10 11 13 13 15 19 20 23 24 23 22 24 Vermont **********1411 Virgin Islands 0000000000*** Virginia 5 7 9 11 12 12 14 17 20 21 21 22 22 Washington 56689101011314141414 West Virginia ********* 222 Wisconsin 7 8 9 11 12 13 15 18 19 18 19 18 19 Wyoming **********11214 Nationwide 6 % 8 % 9 % 10 % 11 % 13 % 15 % 16 % 18 % 18 % 19 % 18 % 17 % * Data withheld to maintain firm confidentiality. NA is an abbreviation for not applicable. Some data have been revised for June and December 2005. Jun DecJunJun Dec State Jun Dec Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Jun Dec Jun Jun DecDec Only LECs with at least 10,000 lines in a state were required to report through December 2004. Beginning with the June 2005 data all LECs are required to report. Table 8.6 Competitive Local Exchange Carrier Share of End-User Switched Access Lines 2003200220012000 20062004 8 - 10 TRS Data TRS & USF Data FCC Form 499 Data 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Number of Local Competitors 1 RBOCs & Other Incumbent LECs 1,281 1,347 1,347 1,376 1,410 1,348 1,318 1,335 1,335 1,309 1,301 1,270 CAPs & CLECs 20 30 57 94 129 212 298 479 511 542 601 690 Local Resellers, Shared Tenant, Private Carriers, & Other Local NA NA NA 25 18 64 96 128 158 186 172 228 All Other Carriers Reporting Local Exchange Service Revenues NA NA NA 74 109 133 143 229 168 176 179 186 Total 2 1,301 1,377 1,404 1,569 1,666 1,757 1,855 2,171 2,172 2,213 2,253 2,374 Local Service Revenues 3 Incumbent LECs Bell Operating Companies 4 $58,838 $61,415 $65,485 $70,290 $68,028 $69,801 $76,586 $93,135 $93,388 $91,158 $85,558 $82,555 Other Incumbent LECs 4 20,894 22,507 24,269 24,899 24,960 26,989 26,084 15,166 17,490 17,590 18,141 18,326 Total 5 79,732 83,922 89,754 95,189 92,988 96,790 102,670 108,301 110,879 108,749 103,699 100,881 Local Service Competitors CAPs & CLECs 174 269 595 949 1,556 2,393 4,505 7,552 10,629 10,001 12,373 12,363 Local Resellers, Shared Tenant, Private Carriers, & Other Local NA NA NA NA 224 329 522 914 1,395 1,644 943 1,405 All Other Filers (Local Exchange Service Revenues Only) 5 46 32 56 59 381 809 1,319 2,028 2,796 3,337 4,979 5,136 Total 220 301 651 1,008 2,161 3,530 6,347 10,494 14,820 14,982 18,295 18,904 Total $79,952 $84,224 $90,405 $96,197 $95,149 $100,320 $109,016 $118,795 $125,698 $123,730 $121,994 $119,785 Share of Local Service Revenues Incumbent LECs Bell Operating Companies 73.6% 72.9% 72.4% 73.1% 71.5% 69.6% 70.3% 78.4% 74.3% 73.7% 70.1% 68.9% Other Incumbent LECs 26.1% 26.7% 26.8% 25.9% 26.2% 26.9% 23.9% 12.8% 13.9% 14.2% 14.9% 15.3% Total 99.7% 99.6% 99.3% 99.0% 97.7% 96.5% 94.2% 91.2% 88.2% 87.9% 85.0% 84.2% Local Service Competitors CAPs & CLECs 0.2% 0.3% 0.7% 1.0% 1.6% 2.4% 4.1% 6.4% 8.5% 8.1% 10.1% 10.3% Local Resellers, Shared Tenant, Private Carriers, & Other Local NA NA NA NA 0.2% 0.3% 0.5% 0.8% 1.1% 1.3% 0.8% 1.2% Providers All Other Filers 0.1% 0.0% 0.1% 0.1% 0.4% 0.8% 1.2% 1.7% 2.2% 2.7% 4.1% 4.3% Total 0.3% 0.4% 0.7% 1.0% 2.3% 3.5% 5.8% 8.8% 11.8% 12.1% 15.0% 15.8% Total Telecommunications Revenues (Including Payphone, Mobile, & Toll Service) Incumbent LECs 4 $95,228 $98,431 $102,820 $107,905 $105,154 $108,234 $112,216 $116,158 $117,885 $114,999 $109,480 $105,496 Local Competitors 191 274 637 1,012 2,481 4,034 6,508 10,945 14,781 15,309 16,857 18,215 Ratio of ILEC Total Telecommunications 498 : 1 351 : 1 165 : 1 107 : 1 42 : 1 27 : 1 17 : 1 11 : 1 8 : 1 8 : 1 6 : 1 6 : 1 Revenues to Local Competitor Total Telecommunications Revenues See notes on following page. Table 8.7 Chart 8.5 ILEC and New Local Competitor Share of Local Service Revenue Nationwide Local Service Revenues and New Competitors' Share 1 (Dollar Amounts Shown in Millions) 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% ILEC Share 96.5% 94.2% 91.2% 88.2% 87.9% 85.0% 84.2% New Competitor Share 3.5% 5.8% 8.8% 11.8% 12.1% 15.0% 15.8% 1998 1999 2000 2001 2002 2003 2004 8 - 11 Notes to Table 8.7. NA - Not available. 1 Counts for incumbent LECs, CLECs, CAPs, local resellers, shared tenant service providers, private carriers and other local service providers are based on the numbers of filers actually reporting revenues. The category All Other Filers includes payphone, mobile service, and toll providers that reported local exchange service revenues. Non-incumbent LEC affiliates of incumbent LECs are classified as local service competitors, not as incumbent LECs. 2 The total number of local service providers shown in Table 8.7 differs from the total fixed local service providers shown in Table 15.3 because the number shown in Table 8.7 includes filers that self identify as mobile or toll providers, but that report some local exchange service revenues. 3 For 1993 through 1996, for most categories of carriers, local service revenues include revenues from the following TRS reporting categories: local exchange, local private line, other local services, interstate access services, and intrastate access services. The amounts shown do not include pay telephone, mobile, or toll service revenues. See also footnote four. 1998 revenues for carriers that filed TRS worksheets but not universal service worksheets were estimated using 1998 TRS worksheets. These worksheets contain carrier revenue data for calendar year 1997. 4 Incumbent LEC local service revenues for 1996 and prior years include significant amounts of yellow pages, billing and collection, and other revenues that were reported as other local service revenues. If these revenues were included in 1997, incumbent LECs would show significant revenue growth from 1996 to 1997. Inside wire maintenance was included in local service revenues in 1997 but not thereafter. 5 Toll carriers typically provide resold special access and private line services as part of toll service operations. Accordingly, the table shows local exchange revenues rather than all local revenues for these carriers. Sources: Data filed on FCC Forms 431, 457, 499-Q and 499-A worksheets. See also: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006). 8 - 12 Table 8.8 Telephone Number Porting Activity Since Wireless Porting Started 1 Landline to Landline to Mobile Cellular/PCS Month Landline Mobile Mobile 2 to Landline Total (thousands) (thousands) (thousands) 2003 November 3 561 2 61 1 625 December 638 12 756 1 1,407 2004 January 809 24 713 1 1,547 February 711 65 591 2 1,369 March 776 79 632 1 1,488 April 718 49 613 1 1,381 May 756 73 689 1 1,519 June 789 165 873 2 1,829 July 656 143 806 3 1,608 August 4 786 95 824 * 1,705 September 701 43 787 1 1,532 October 899 97 738 1 1,735 November 736 131 736 2 1,605 December 692 86 910 1 1,689 2005 January 698 53 808 2 1,561 February 936 81 735 1 1,753 March 1,257 74 815 2 2,148 April 959 55 797 1 1,812 May 892 56 862 1 1,811 June 1,064 38 1,153 2 2,257 July 1,006 62 982 2 2,052 August 1,203 42 933 2 2,179 September 1,114 31 835 2 1,982 October 991 37 866 2 1,896 November 1,023 29 826 2 1,880 December 1,079 22 1,031 2 2,135 2006 January 1,242 37 879 4 2,162 February 1,347 22 807 3 2,178 March 1,422 19 876 2 2,319 April 1,095 19 747 2 1,863 May 1,213 46 813 2 2,073 June 1,010 30 862 2 1,904 Cumulative Total 29,779 1,817 25,356 54 57,004 * Indicates a number between 1 and 499. Source: Raw data from Local Number Portability Administrator (NeuStar, Inc.). Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. 1 Monthly figures include numbers that were ported back to the original carrier, or where the subscriber with the ported number terminated service. 3 Wireless porting started November 24, 2003. These figures include all ports during the month of November, which for ports from or to a wireless carrier, include a small number of test ports that happened prior to November 24. 4 Due to a data problem, does not include numbers that were ported back to the original carrier, or where the subscriber with the ported number terminated service. 2 Excludes significant porting activity between Cingular and AT&T Wireless following the closing of their merger in October 2004. 8 - 13 Table 8.9 Telephone Numbers Remaining in the Porting Database at the End of Each Quarter 1 Landline to Landline to Mobile to Mobile to Total Year Quarter Landline Mobile Mobile 2 Landline (thousands) (thousands) (thousands) 1999 Second 1,840 * * * 1,840 Third 2,658 * * * 2,658 Fourth 3,854 * * * 3,854 2000 First 5,029 * * * 5,029 Second 5,781 * * * 5,781 Third 7,595 * * * 7,595 Fourth 9,146 * * * 9,146 2001 First 10,567 * * * 10,567 Second 12,310 * * * 12,310 Third 14,610 * * * 14,610 Fourth 15,519 * * * 15,519 2002 First 16,810 * * * 16,810 Second 18,210 * * * 18,210 Third 19,862 * * * 19,862 Fourth 21,449 * * * 21,449 2003 First 22,781 * * * 22,781 Second 23,723 * * * 23,723 Third 24,796 * * * 24,796 Fourth 25,869 16 795 2 26,682 2004 First 28,462 173 2,686 3 31,324 Second 28,371 406 4,635 4 33,417 Third 29,396 667 6,874 9 36,945 Fourth 30,607 832 9,041 11 41,491 2005 First 32,399 1,001 10,860 16 44,276 Second 34,136 1,092 12,926 19 48,173 Third 35,959 1,201 14,327 23 51,510 Fourth 37,607 1,226 16,101 29 54,963 2006 First 40,193 1,273 17,577 34 59,077 Second 42,130 1,333 19,032 42 62,538 2 Excludes significant porting activity between Cingular and AT&T Wireless following the closing of their merger. Source: Raw data from Local Number Portability Administrator (NeuStar, Inc.). Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. * Wireless portability started November 24, 2003. A small number of test ports were conducted before then. 1 Numbers ported because customer changed carriers. The database contains the date when the telephone number record was last updated. For most telephone numbers, this was the most recent port. For those telephone numbers affected by area code changes, however, the date refers to when the record was updated to reflect the new area code. See the text for a fuller discussion. 8 - 14 Table 8.10 Numbers in the Porting Database by Quarter in Which They Were Most Recently Ported 1 June 30, 2006 2 Ported During Landline to Landline to Mobile to Mobile to Year Quarter Landline Mobile Mobile Landline (thousands) (thousands) 1998 First 0 3 ** * Second 3 * * * Third 41 * * * Fourth 138 * * * 1999 First 232 * * * Second 355 * * * Third 399 * * * Fourth 516 * * * 2000 First 549 * * * Second 597 * * * Third 743 * * * Fourth 860 * * * 2001 First 851 * * * Second 1,042 * * * Third 1,086 * * * Fourth 1,258 * * * 2002 First 1,122 * * * Second 1,256 * * * Third 1,667 * * * Fourth 1,665 * * * 2003 First 1,240 * * * Second 1,346 * * * Third 1,343 * * * Fourth 1,287 10 530 1 2004 First 1,773 125 1,265 1 Second 1,736 129 1,542 2 Third 1,826 206 1,830 6 Fourth 1,761 229 1,918 3 2005 First 2,214 171 1,793 2 Second 2,403 118 1,949 2 Third 2,745 122 2,212 3 Fourth 2,594 82 2,279 3 2006 First 3,564 71 2,258 4 Second 2,985 94 2,230 3 1 Numbers ported because customer changed carriers. 3 Number is between 0 and 499. Source: Raw data from Local Number Portability Administrator (NeuStar, Inc.). Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau. 2 The local number portability database was designed solely for the purpose of routing calls. As such, it retains only the most recent porting activity for any given number. So if a consumer ports a number from Carrier A to Carrier B, and later the consumer then ports the number from Carrier B to Carrier C, the database will not reflect the original port from Carrier A to Carrier B. Also, numbers that revert back to the original carrier (either because the customer ports the number back to the original carrier or because the customer discontinues service with that number) are dropped from the database. Lastly, area code splits can make a number appear to be ported later than it actually was. * Wireless portability started November 24, 2003. A small number of test ports were conducted before then. NeuStar supplies information indicating which carrier are wireless and which are wireline. Occasionally, a carrier that had been identified as a wireline carrier is later identified as a wireless carrier, and vice-versa. 8 - 15 9 - 1 9 Long Distance Telephone Industry Until the 1970s, AT&T had a virtual monopoly on long distance service in the United States. In the 1970s, competitors such as MCI and Sprint began also to offer long distance service. With the gradual emergence of competition, basic rates dropped, calling surged, and AT&T’s dominance declined. More than 1,200 companies now offer wireline long distance service. These carriers remain subject to the Commission’s jurisdiction. The Commission, however, has chosen to rely on competition, rather than regulation, as much as possible. Thus, the Commission forbears from regulating most aspects of long distance service. 1. Toll Revenues In 2004, carriers providing toll service generated $70.1 billion in toll revenues. These include toll revenues from long distance carriers, wireless toll from wireless carriers, and toll revenues from local exchange carriers. These revenues are shown in Table 9.1. Toll calls can be divided into three jurisdictional categories - intrastate calls, domestic interstate calls, and international calls. The revenues, from 1980 through 2004, for each of the three jurisdictional categories are shown in Table 9.2. Toll revenues also can be divided between residential and nonresidential services, as in Table 9.3. In 2004, residential customers generated over one third of all end-user toll revenues. 2. Number of Companies The number and types of carriers reporting long distance revenues are shown in Table 9.4. The Telecommunications Reporting Worksheet (FCC Form 499-A) requires each filer to select up to five of 20 categories as best describing its primary line of business. Six of these categories consist of carriers that are primarily engaged in providing long distance service and are collectively described as being toll carriers: interexchange carriers (IXCs), operator service providers (OSPs), other toll service providers, prepaid calling card providers, satellite service providers, and toll resellers. In 2004, 1,204 filers selected at least one of the above toll service provider categories as their primary line of business and are therefore categorized as being a toll carrier. (They were also asked to rank their choices with one being the most important. Prior to 1986, carrier identification codes (CICs) provided information on the number of firms seeking to acquire certain types of interconnecting arrangements with local telephone companies. Beginning in 1986, a number of corporations, government agencies and other organizations began to acquire carrier identification codes for their own use, rather than for the purpose of providing telecommunications services to others. 9 - 2 After that time, the use of such codes to estimate the number of long distance carriers became less reliable. The number of codes assigned over time can be found in the long distance section of the May 2004 Trends report which can be accessed at www.fcc.gov/wcb/stats.html. CICs are currently assigned by the North American Numbering Plan Administration (NANPA), which is part of Neustar, Inc. Further information on such codes can be found on the Internet at www.nanpa.com. 3. Long Distance Market Shares A generation ago, before the breakup of the Bell System, AT&T’s local telephone companies provided local service to most of the United States. At the beginning of 1984, however, AT&T’s local operating companies were divested in the settlement of an antitrust case. After the AT&T divestiture, AT&T’s former operating companies were restricted to providing service within their own local access and transport areas (LATAs), i.e., they were precluded from offering toll service that crossed LATA boundaries. As a result, two separate and distinct toll markets emerged. In the first, AT&T competed with small but rapidly growing competitors for calls that crossed LATA boundaries. This market included almost all interstate and international calls and a large number of intrastate toll calls as well. A second and much smaller market consisted of short distance toll calls that did not cross LATA boundaries. This second market was dominated, at least initially, by the local exchange carriers operating within their own service territories. Over time, the distinctions between the two markets have become blurred as customers acquired the ability to select among competing carriers for their intraLATA calls as well as their interLATA calls. As discussed in greater detail in the following section, the 1996 Telecommunications Act established a procedure for Bell companies to offer in-region, interLATA long distance service after complying with certain preconditions to open their own markets. Bill Harvestingฎ data collected by TNS Telecoms (TNS) are used to calculate residential market shares. Further information on TNS and its Bill Harvestingฎ data can be found in Section 14 and in Appendix B. Table 9.5, which is based on this information, presents nationwide market shares of households, and directly dialed intraLATA and interLATA minutes from 1995 to 2005. Chart 9.2 shows the residential household market shares for the largest carriers for 2005. Table 9.6 presents market shares by region for 2005. Chart 9.3 shows residential market shares for the largest carriers for the northeast and southwest regions for 2005. 9 - 3 4. Section 271 Applications Section 271 of the Communications Act required the regional Bell operating companies (RBOCs) to apply to the Commission, on a state-by-state basis, for authorization to provide in-region interLATA services. To obtain such authorization pursuant to section 271, the RBOC had to demonstrate that it satisfied the 14-point competitive checklist, that it complied with the separate affiliate and nondiscrimination requirements of section 272, and that the requested authorization was consistent with the public interest, convenience, and necessity. After a section 271 application was filed with the Commission, the Commission had 90 days to determine whether the RBOC had taken the statutorily required steps to open its local telecommunications markets to competition. A RBOC applicant had to demonstrate either that: A) one or more unaffiliated competing providers of local telephone service to residential and business subscribers was connected to the RBOC’s network, and that such local telephone service was being “offered by such competing providers either exclusively over their own telephone exchange service facilities or predominately over their own telephone exchange service facilities in combination with the resale of the telecommunications services of another carrier” (commonly referred to as “Track A”); or B) if no potential competing provider had requested to connect to a RBOC’s network, the RBOC had a statement of generally available terms and conditions in place demonstrating that it is ready to allow potential competitors to connect to its facilities (commonly referred to as “Track B”). On December 22, 1999, the first regional Bell operating company’s application (Bell Atlantic, now known as Verizon) was approved by the Commission to provide in- region interLATA service in the state of New York. On December 3, 2003, the final Bell operating company’s application (Qwest) was approved to provide in-region interLATA service in the state of Arizona. Table 9.7 shows the states in which the BOCs filed section 271 applications, the Bell operating company’s name, and the application’s resolution date. The companies approved must continue to comply with the section 271 requirements. The Commission has a number of enforcement tools at its disposal, including imposing penalties or suspension of approval. Company 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 AT&T Companies 1 AT&T Communications, Inc. $37,166 $38,069 $39,264 $39,470 $40,551 $39,680 $37,646 $33,310 $27,094 $22,418 $22,243 Alascom, Inc. 329 325 Teleport Communications Group, Inc. 284 464 632 437 396 1,376 ACC Long Distance Corp. 118 122 123 MCI Companies 2 MCI - L.D. Operations 22,192 23,431 22,554 21,259 17,659 16,062 11,602 MCI Telecomunications Corp. 11,715 14,617 16,372 17,150 WorldCom, Inc. 2,221 3,640 4,485 5,897 Wiltel, Inc. 917 MFS Intelenet, Inc. 118 122 Intermedia Communications, Inc. 380 516 444 Sprint Corporation - Long Distance Division 6,805 7,277 7,944 8,595 7,994 9,708 9,038 8,424 7,077 6,326 5,900 SBC Companies SBC Communications, Inc. [ILEC] 3 2,748 2,420 2,182 2,083 1,692 SBC Long Distance, Inc.* 449 729 1,572 2,892 SNET America, Inc.* 142 162 186 189 177 158 154 143 Verizon Companies Bell Atlantic Comm, Inc. d/b/a Verizon Long Dist.* 130 864 1,433 1,802 2,041 Verizon Communications, Inc. [ILEC] 3 2,278 1,988 1,668 1,629 1,555 Verizon Select Services, Inc. 340 607 834 1,004 509 223 441 NYNEX LD Co. d/b/a Verizon Enter. Solutions * 316 316 Qwest Companies 4 Qwest Communications Corp.* 320 517 1,773 2,309 3,202 2,824 3,307 Qwest Communications, Inc. [ILEC] 3 374 264 175 124 78 Qwest LD Corp. 366 Qwest Interprise America, Inc. 339 LCI Int'l Telecom Corp. d/b/a Qwest Comm. Svcs. * 453 671 1,103 1,001 1,664 1,394 1,271 871 USLD Communications, Inc.* 136 155 188 241 279 216 IDT Corporation 376 850 945 1,303 1,532 1,835 2,217 Global Crossing Companies Global Crossing Bandwidth, Inc. 144 127 324 539 692 1,555 1,225 1,312 1,565 1,317 Global Crossing Telecommunications, Inc. 568 827 1,119 775 874 874 801 817 786 615 625 Global Crossing North American Networks, Inc. 306 309 323 223 196 International Exchange Ntwks, Ltd. (IXnet, Inc.) 131 BellSouth Companies BellSouth Long Distance, Inc. * 294 486 928 1,483 BellSouth Telecommunications, Inc. [ILEC] 3 466 412 341 341 268 WilTel Communications, LLC 5 227 126 184 413 593 737 1,112 1,302 VarTec Companies VarTec Telecom, Inc. 107 125 470 820 836 819 923 947 793 404 c Excel Telecommunications, Inc. 156 363 1,091 1,179 1,219 942 703 611 427 665 c eMeritus Communications, Inc. 215 429 379 264 260 169 Long Distance Wholesale Club 176 121 131 Broadwing Communications, LLC 310 658 Teleglobe America Inc. 275 557 282 208 269 409 508 ITC^DeltaCom Cos. 6 ITC^DeltaCom Communications, Inc 122 172 270 259 311 308 324 Business Telecom, Inc. 115 149 195 212 260 271 286 251 228 177 Citizens Communications Cos. 7 Frontier Communications of America, Inc. 133 121 193 Electric Lightwave, Inc. 145 227 180 176 169 General Communication, Inc. 8 106 120 143 158 175 184 211 238 227 263 283 McLeodUSA Telecommunications Services, Inc. 232 448 463 358 274 225 Evercom Systems, Inc. 205 206 245 239 184 206 Level 3 Communications, LLC 160 131 134 190 ALLTEL Communications, Inc. (ACI) 120 175 174 160 175 188 Primus Telecommunications, Inc. 219 183 Talk America Inc. 180 232 305 426 398 428 249 160 158 176 Americatel Corporation 129 188 269 246 193 139 Norlight Telecommunications, Inc. 119 142 140 141 136 Sum of Above Companies # 65,258 Toll Service Revenues of Above Companies 58,537 Incumbent Local Exchange Carriers 8 13,375 11,332 11,248 10,215 9,429 8,046 Other Toll Service Providers 9 9,626 10,709 14,765 13,029 15,783 16,647 20,827 16,702 12,797 12,034 12,677 Total Toll Service Revenues 10 $84,478 $89,629 $99,691 $100,793 $105,055 $108,246 $109,616 $99,300 $83,697 $77,188 $71,214 Note: Total toll service revenues include intrastate, interstate and international toll revenues. Also, some numbers for previous years have been revised for consistency with other reports. # Some of the companies included non toll-related revenues in their annual submissions filed pursuant to Section 43.21(c) of the Commission's rules. * Regional Bell Operating Company's long distance subsidiaries. 9 - 5 Table 9.1 Total Toll Service Revenues by Provider (Dollar Amounts Shown in Millions) 2004 Notes for Table 9.1 1 ACC Long Distance Corp. and Teleport Communications Group merged in April of 1998, and the combined company, Teleport Communications Group, merged with AT&T Communications, Inc. in July of that year. AT&T Communications acquired Alascom, Inc. on August 7, 1995 and began filing a consolidated revenue statement in 1996. 2 On July 21, 2002, WorldCom and substantially all of its U.S. subsidiaries filed voluntary petitions for relief in the U.S. Bankruptcy Court for the Southern District of New York under Chapter 11 of Title 11 of the U.S. Bankruptcy Code. On April 20, 2004, WorldCom emerged from bankruptcy and merged with and into MCI whereby the separate existence of WorldCom ceased and MCI became the surviving company. 3 Includes revenue for long distance and data services. 4 Qwest Interprise America, Inc. is a subsidiary for out-of-region DSL (Digital Subscriber Line); and Qwest LD Corp. is a subsidiary for in-region long distance. 5 In November 2003, WilTel Communications, LLC became a wholly-owned, indirect subsidiary of Leucadia National Corporation. Thus, it no longer files with the SEC (Securities & Exchange Commission) on a stand-alone basis. 6 Excludes operating revenues derived from non-communications (i.e., non-regulatory) operations. 7 Citizens Communications Company offers its ILEC services under the "Frontier" name, and its CLEC services through Electric Lightwave, Inc. Both companies are wholly-owned subsidiaries of Citizens and were acquired, respectively, in June of 2001 and June of 2002. 8 Operating revenue of Cincinnati Bell Any Distance Inc, a wholly-owned subsidiary of Cincinnati Bell Inc, is below the indexed revenue threshold for the calendar- year 2004. 9 BCSI, Inc. sold all of its customers and all of its operating assets to C III Communications, LLC in June of 2003. As a result, it ceased doing business and did file a revenue report pursuant to ง 43.21(c) of the Commission's Rules for the calendar-year 2004. 10 Operating revenue is below the indexed revenue threshold for the calendar-year 2004. 11 ILECs' totals are shown separately through 1999 because they primarily carried intraLATA calls due, in part, to the restrictions imposed on the RBOCs by the 1984 Divestiture Agreement. By 2000, most local exchange customers could presubscribe to any carrier for intraLATA toll service and some RBOCs began to receive Section 271 approval to provide interLATA toll services. 12 Includes wireless toll service revenues reported by wireless carriers, toll service revenues reported by CLECs, and toll service revenues reported by non-RBOC ILECs. 9 - 6 Intrastate, Interstate, and International Toll Revenues (Dollar Amounts Shown in Millions) Toll Revenues End-User Revenues Total Toll Year Intrastate Interstate International Revenues Intrastate Interstate International Revenues 1980 $12,700 $19,049 $1,586 $33,335 $1,475 1981 14,632 21,948 2,599 39,180 2,485 1982 16,457 24,685 2,777 43,919 2,651 1983 17,612 26,418 2,940 46,970 2,802 1984 19,077 28,616 3,463 51,156 3,309 1985 20,408 30,613 3,794 54,815 3,636 1986 21,340 32,010 4,119 57,468 3,947 1987 21,563 32,345 4,611 58,519 4,436 1988 22,900 34,350 5,350 62,600 5,146 1989 23,850 35,775 6,399 66,024 6,340 1990 25,622 33,678 7,492 66,792 7,390 1991 24,090 35,837 8,631 68,558 8,480 1992 27,667 37,871 10,207 75,744 9,810 1993 30,950 40,212 11,364 82,525 10,901 1994 29,815 42,028 12,635 84,478 12,100 1995 31,519 43,955 14,155 89,629 13,144 1996 34,181 48,903 16,607 99,691 15,023 1997 32,859 49,247 18,688 100,793 $30,144 $43,640 15,409 $89,193 1998 34,699 50,000 20,356 105,055 30,800 44,153 16,654 91,607 1999 33,600 54,590 20,056 108,246 29,976 47,598 15,737 93,311 2000 33,030 56,225 20,361 109,615 28,501 42,980 16,286 87,767 2001 29,530 46,389 23,381 99,301 25,891 36,660 16,751 79,302 2002 25,772 39,725 18,200 83,697 22,122 31,707 13,392 67,222 2003 23,160 38,550 15,479 77,188 18,889 28,088 12,006 58,983 2004 21,748 34,664 14,802 71,214 17,762 27,487 10,262 55,511 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006); International Bureau, Trends in the U.S. International Telecommunications Industry (September 2005); 47 CFR ง 43.21(c) data through 1991. Through 1996, some breakouts based on staff estimates. Table 9.2 Toll Revenues by Market Segment (Dollar Amounts Shown in Billions) Chart 9.1 Total Toll $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 Interstate Intrastate International 9 - 7 Table 9.3 End-User Toll Revenues (Dollar Amounts Shown in Millions) Residential End-User End-User Toll Revenues Toll as a Toll By Customer Type Percentage Revenues 2/ of all End- Year User Toll Residential Other Revenues 1/ 1995 46 % $75,638 $35,103 $40,535 1996 45 82,616 37,543 45,074 1997 46 89,193 40,978 48,215 1998 44 91,607 40,284 51,323 1999 42 93,311 39,466 53,845 2000 38 87,767 33,327 54,440 2001 33 79,302 26,075 53,227 2002 34 67,222 23,018 44,204 2003 35 58,983 20,903 38,080 2004 33 55,511 18,535 36,976 Note: Data for some prior years have been revised. 1/ Staff estimates are based on market segment data in carrier annual reports to shareholders; average household payments to long distance carriers shown in Table 3.2; and residential toll revenues published by the U.S. Census Bureau in the Service Annual Survey: 2002, Table 3.3.11, and previous reports. 2/ Toll services are telecommunications services that enable customers to communicate outside of local exchange calling areas. Toll service revenues include revenues from ordinary long distance, subscriber toll-free, operator service, prepaid calling card, long distance private line, satellite services, and other long distance services. End-user toll revenues consist of toll service revenues from end-user customers, governments, non-profits, de minimis resellers, and any other customer that does not contribute directly to universal service. Source: End-user toll revenues for 1997 through 2004 are taken from Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006), and previous editions. Figures for 1995 and 1996 are staff estimates. 9 - 8 Table 9.4 Number of Toll Service Providers TRS Data TRS & FCC Form 499-A Data USF Data 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Carriers That Provide Toll Service 1/ Toll Carriers Interexchange Carriers (IXCs) 83 97 130 149 151 171 178 212 233 229 232 257 Other Toll Carriers Operator Service Providers (OSPs) 352925273224152019181719 Pre-paid Calling Card Providers NA NA 8 16 18 20 18 23 27 27 50 67 Satellite Service Providers NA NA NA 22 13 13 17 25 34 33 40 40 Toll Resellers 171 206 260 345 340 388 406 493 558 574 642 751 Other Toll Service Providers 32 34 30 28 15 31 17 35 69 51 45 70 Total Toll Service Providers 321 366 453 587 569 647 651 808 940 932 1,026 1,204 Fixed Local Service, Payphone, and Mobile Service Filers with Toll Service Revenues NA NA NA NA 1,537 1,740 1,870 1,678 1,884 1,602 1,678 1,680 All Toll Service Providers NA NA NA NA 2,106 2,387 2,521 2,486 2,824 2,534 2,704 2,884 NA - Not available. 1/ Counts of toll carriers represent the numbers of filers that reported telecommunications revenues and that identified themselves using a toll carrier category. Filers that identified themselves as Fixed Local Service, Payphone, and Mobile Service providers were counted as toll providers only if they reported toll service revenues. Sources: Data filed on FCC Forms 431, 457, and 499-A worksheets. See also: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006) and Telecommunications Provider Locator (March 2006), available at http://www.fcc.gov/wcb/stats. 9 - 9 AT&T 1 MCI 2 Sprint BellSouth 3 Qwest 4 SBC 5 Verizon 6 Other 7 1995 74.6 % 13.0 % 4.2 % (7) % (7) % (7) % (7) % 8.2 % 1996 69.9 14.1 5.0 (7) (7) (7) (7) 11.0 1997 67.2 13.2 5.7 (7) (7) (7) (7) 13.8 1998 62.6 15.1 5.7 (7) (7) (7) (7) 16.6 1999 62.5 16.0 6.2 (7) (7) (7) (7) 15.4 2000 51.1 18.0 6.6 0.1 1.6 1.0 4.6 17.0 2001 42.3 18.5 6.8 0.1 2.9 2.6 6.7 20.0 2002 36.7 15.8 7.6 0.2 2.5 3.8 9.3 24.1 2003 31.7 13.0 7.1 2.2 3.2 7.5 10.8 24.4 2004 23.5 9.9 6.9 4.4 5.7 13.2 12.9 23.5 2005 18.1 7.7 6.2 5.9 5.9 15.9 16.2 24.1 1995 8.9 % 2.4 % 4.6 % (7) % (7) % (7) % (7) % 84.1 % 1996 9.5 5.4 4.4 (7) (7) (7) (7) 80.6 1997 13.9 6.7 3.7 (7) (7) (7) (7) 75.7 1998 15.6 8.7 3.8 (7) (7) (7) (7) 71.8 1999 16.9 12.0 3.6 (7) (7) (7) (7) 67.5 2000 17.3 12.8 5.0 1.6 5.0 18.6 18.0 21.7 2001 15.4 13.2 4.8 1.4 4.3 17.9 17.6 25.3 2002 14.0 11.8 4.8 1.1 2.9 18.5 16.3 30.7 2003 10.7 11.4 8.1 0.9 2.7 17.7 13.2 35.4 2004 7.5 9.4 5.0 1.0 4.6 30.5 12.2 29.9 2005 5.5 9.2 5.3 1.3 5.3 34.3 12.2 26.7 1995 69.5 % 16.1 % 5.8 % (7) % (7) % (7) % (7) % 8.6 % 1996 62.5 15.9 7.1 (7) (7) (7) (7) 14.5 1997 62.4 14.9 6.5 (7) (7) (7) (7) 16.2 1998 58.4 17.0 6.5 (7) (7) (7) (7) 18.1 1999 53.2 20.9 6.6 (7) (7) (7) (7) 19.3 2000 44.7 22.0 7.3 0.1 1.6 0.5 2.5 21.3 2001 36.3 20.5 7.6 0.1 1.9 1.8 3.6 28.1 2002 31.2 18.1 9.0 0.3 1.6 3.1 5.6 31.0 2003 26.0 16.6 7.9 1.4 1.8 6.6 6.6 32.9 2004 17.0 12.5 8.1 1.9 6.4 20.3 6.7 27.0 2005 10.8 11.3 8.6 2.6 8.5 23.7 8.2 26.3 Residential Household Market Shares Table 9.5 Residential Household Market Shares (1995 - 2005) Chart 9.2 Households 8 Direct Dial IntraLATA Minutes Direct Dial InterLATA Minutes 2005 Other 24.1% AT&T 18.1% Qwest 5.9% MCI 7.7% Sprint 6.2% BellSouth 5.9% SBC 15.9% Verizon 16.2% 9 - 10 Notes for Table 9.5 1 AT&T Long Distance, Lucky Dog Phone Co. and ACC Long Distance 2 MCI Long Distance, Telecom USA, Touch 1, TTI National, LDDS WorldCom and WorldCom Network Service 3 BellSouth Long Distance and BellSouth Public Communications 4 Qwest and U S WEST Long Distance 6 Bell Atlantic Long Distance, NYNEX/Bell Atlantic North, Verizon Select Services and GTE 7 Until 2000, the regional Bell operating companies are not broken out of the "Other" category. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor ™, Bill Harvesting ฎ. 8 Each household is assumed to have a single access line (less than 8% of households in the 2003 sample had more than one access line). These lines are allocated across carriers based on the household's primary long distance carrier which is imputed by the provider of the data, TNS Telecoms. In 1995, 1996 and 1999-2003, TNS defined the household's primary long distance carrier. In 1997, a household's primary long distance carrier was determined based on calls made through long distance carriers, and in 1998, a household's primary long distance carrier was determined based on interLATA calls. Note: Market shares are estimates based on sample data. Shares for past years have been revised to take into account mergers and acquisitions and changes in methodology. Columns may not sum to 100% due to rounding. 5 Ameritech Communications, Ameritech 800, Pacific Bell, Southwest Long Distance, SBC Long Distance and SNET All Distance 9 - 11 Region 1 AT&T 2 MCI 3 Sprint Sample Size Southeast 19.8 % 7.6 % 10.6 % 29.7 % 1.2 % 0.0 % 7.5 % 23.6 % 5,407 West 14.0 9.5 4.8 0.0 34.6 0.2 5.0 31.9 3,760 West Coast 18.8 6.3 5.9 0.0 1.8 37.8 12.1 17.3 3,169 Mid-Atlantic 23.4 9.8 5.5 0.1 1.0 0.1 38.5 21.6 3,841 Mid-West 17.6 7.2 5.6 0.0 1.4 32.2 8.7 27.3 4,300 Northeast 18.7 7.8 2.3 0.0 0.7 7.0 38.6 24.8 3,494 Southwest 12.7 5.2 6.2 0.1 1.3 46.6 7.3 20.6 3,213 Total 18.1 % 7.7 % 6.2 % 5.9 % 5.9 % 15.9 % 16.2 % 24.1 % 27,184 Southeast 5.2 % 8.4 % 16.3 % 16.5 % 0.2 % 0.0 % 5.7 % 47.8 % 44,482 West 5.4 14.3 1.4 0.0 45.0 0.0 3.7 30.3 62,836 West Coast 5.5 5.8 3.2 0.0 0.2 59.5 11.6 14.1 106,554 Mid-Atlantic 13.5 11.5 10.7 0.0 0.3 0.0 37.3 26.6 68,723 Mid-West 2.0 6.4 3.1 0.0 0.2 51.4 7.7 29.2 123,028 Northeast 9.9 15.7 2.0 0.0 0.3 16.8 18.8 36.5 55,844 Southwest 1.4 8.5 5.9 0.0 0.0 60.0 5.1 19.1 86,736 Total 5.5 % 9.2 % 5.3 % 1.3 % 5.3 % 34.3 % 12.2 % 26.7 % 548,202 Southeast 16.5 11.7 18.0 16.9 1.1 0.0 5.5 30.2 169,228 West 6.1 7.9 9.4 0.0 48.3 0.0 2.3 26.0 171,838 West Coast 8.2 8.4 6.9 0.0 0.7 50.3 6.5 18.9 155,323 Mid-Atlantic 17.6 17.5 12.8 0.0 1.7 0.0 15.7 34.7 143,165 Mid-West 7.0 16.7 4.2 0.0 0.6 38.1 5.2 28.2 197,721 Northeast 18.6 12.0 3.4 0.0 1.0 9.4 25.9 29.6 106,301 Southwest 5.3 4.4 4.3 0.0 1.5 63.6 3.9 17.0 151,535 Total 10.8 11.3 8.6 2.6 8.5 23.7 8.2 26.3 1,095,111 Table 9.6 Residential Household Market Shares By Region: 2005 BellSouth 4 Qwest 5 SBC 6 Verizon 7 Other 8 Direct Dial IntraLATA Minutes Direct Dial InterLATA Minutes Households Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvesting ฎ. Chart 9.3 Residential Household Market Shares by Region: 2005 Note: Market shares are estimates based on sample data. Columns may not sum to 100% due to rounding. For footnotes, please see the next page. Northeast Qwest 0.7% SBC 7.0% Other 24.8% Sprint 2.3% BellSouth 0.0% Verizon 38.6% AT&T 18.7% MCI 7.8% Southwest SBC 46.6% AT&T 12.7% Verizon 7.3% Other 20.6% MCI 5.2% Sprint 6.2% BellSouth 0.1% Qwest 1.3% 9 - 12 Notes for Table 9.6 2 AT&T Long Distance, Lucky Dog Phone Co. and ACC Long Distance 3 MCI Long Distance, Telecom USA, Touch 1, TTI National, LDDS WorldCom and WorldCom Network Service 4 BellSouth Long Distance and BellSouth Public Communications 5 Qwest and U S WEST Long Distance 7 Bell Atlantic Long Distance, NYNEX/Bell Atlantic North, Verizon Select Services and GTE 1 Southeast: Alabama, Florida, Georgia, Kentucky, Louisiana, Mississippi, North Carolina, South Carolina and Tennessee West: Arizona, Colorado, Idaho, Iowa, Minnesota, Montana, Nebraska, New Mexico, North Dakota, Oregon, South Dakota, Utah, Washington and Wyoming Mid-Atlantic: Delaware, District of Columbia, Maryland, New Jersey, Pennsylvania, Virginia and West Virginia 8 Households with any other presubscribed carrier. Note that households for which the presubscribed carrier is unknown or could not be determined have been excluded from the sample. 6 Ameritech Communications, Ameritech 800, Pacific Bell, Southwest Long Distance, SBC Long Distance and SNET All Distance West Coast: California and Nevada Mid-West: Illinois, Indiana, Michigan, Ohio and Wisconsin Northeast: Connecticut, Maine, Massachusetts, New Hampshire, New York, Rhode Island and Vermont Southwest: Arkansas, Kansas, Missouri, Oklahoma and Texas 9 - 13 Table 9.7 Regional Bell Operating Companies' Applications To Provide In-Region InterLATA Service (Section 271 Applications) State Bell Operating Company Date Application Resolved Alabama BellSouth 09/18/02 Arkansas SBC 11/16/01 Arizona Qwest 12/03/03 California SBC 12/19/02 Colorado Qwest 12/23/02 Connecticut Verizon 07/20/01 Delaware Verizon 09/25/02 District of Columbia Verizon 03/19/03 Florida BellSouth 12/19/02 Georgia BellSouth 05/15/02 Idaho Qwest 12/23/02 Illinois SBC 10/15/03 Indiana SBC 10/15/03 Iowa Qwest 12/23/02 Kansas SBC 01/22/01 Kentucky BellSouth 09/18/02 Louisiana BellSouth 05/15/02 Maine Verizon 06/19/02 Maryland Verizon 03/19/03 Massachusetts Verizon 04/16/01 Michigan SBC 09/17/03 Minnesota Qwest 06/26/03 Mississippi BellSouth 09/18/02 Missouri SBC 11/16/01 Montana Qwest 12/23/02 Nebraska Qwest 12/23/02 Nevada SBC 04/14/03 New Hampshire Verizon 09/25/02 New Jersey Verizon 06/24/02 New Mexico Qwest 04/15/03 New York Verizon 12/22/99 North Carolina BellSouth 09/18/02 North Dakota Qwest 12/23/02 Ohio SBC 10/15/03 Oklahoma SBC 01/22/01 Oregon Qwest 04/15/03 Pennsylvania Verizon 09/19/01 Rhode Island Verizon 02/22/02 South Carolina BellSouth 09/18/02 South Dakota Qwest 04/15/03 Tennessee BellSouth 12/19/02 Texas SBC 06/30/00 Utah Qwest 12/23/02 Vermont Verizon 04/17/02 Virginia Verizon 10/30/02 Washington Qwest 12/23/02 West Virginia Verizon 03/19/03 Wisconsin SBC 10/15/03 Wyoming Qwest 12/23/02 9 - 14 10 - 1 10 Minutes As in the case of telephone lines, there are several alternative measures of calling volumes. Most subscribers purchase service with unlimited local calling. As a result, most local calls are not metered. Periodic studies have been used within the telephone industry to estimate the number of calls and calling minutes for a variety of purposes. For example, periodic studies of dial equipment minutes (DEMs) historically were used to estimate the proportion of calling that is interstate and to allocate costs between interstate and intrastate services. However, DEMs are no longer being used for separations purposes because the separations factors are now frozen. Historical data for DEMs can be found in the August 2003 issue of Trends in Telephone Service. 1. Interstate Switched Access Minutes Switched access minutes are those minutes transmitted by long distance carriers that also use the distribution networks of local telephone companies, i.e., calls made on private telecommunications networks and on leased lines are excluded. On ordinary long distance calls, minutes are counted both where the call originates and where the call terminates. Access minutes include only the domestic portion of international calls. WATS and toll-free (800/888/877/866) calls are counted only on one end of the call. WATS calls generate access minutes only at the terminating end of the call and toll-free (800/888/877/866) calls generate access minutes only at the originating end of the call; both types of minutes are counted in the terminating minutes because they are billed at the terminating rate. Originating WATS and terminating toll-free minutes are covered under special access arrangements, and hence are not subject to switched access charges. Finally, switched access minutes include time for incomplete calls and setup time. Table 10.1 and Chart 10.1 show the total number of interstate switched access minutes handled by all long distance carriers starting with mid-1984, when the data first became available. The number of minutes grew steadily from mid-1984 to 2000 stemming from a combination of overall economic growth and price reductions. Since 2001, interstate switched access minutes have declined, due to a number of reasons including substitution of other services. 2. Billed Access Minutes and Calls Another measure of usage is the number of interLATA billed access minutes and the number of local calls and toll calls. The large incumbent local exchange companies (ILECs) file data on this as part of their Automated Reporting Management Information System (ARMIS) reports. The individual carrier's data can be obtained from the ARMIS Report 43-08 on the ARMIS web page at www.fcc.gov/wcb/armis. The number of interLATA access minutes is based on bills sent to interexchange carriers. They include total originating and terminating access minutes of use. Where these data are unavailable, a statistically valid calculation is sometimes used. The number of local calls refers 10 - 2 to the number of originating calls completed or unanswered between points both of which are within the local service area of the calling telephone, or total originating calls minus total originating toll calls. The number of toll calls completed refers to the number of completed calls directed to a point outside the local service area of the calling telephone. IntraLATA toll calls completed (originating) consist of the number of completed toll calls carried by the reporting local operating company within a given local access and transport area (LATA) and interLATA toll calls completed (originating) consist of completed calls directed to and carried by interexchange carriers. IntraLata toll calls carried by interexchange carriers are not included. More detailed definitions can be found on the ARMIS web site. Intralata toll calls carried by Interexchange carriers are not included. Table 10.2 shows historical data on the number of local and toll calls and the number of interLATA billed access minutes for the large ILECs reporting to the Commission. Toll calls are further categorized by intraLATA, interLATA interstate and interLATA intrastate. Interstate and intrastate billed access minutes are also shown. Access Access Access Access Year Period Minutes Year Period Minutes Year Period Minutes Year Period Minutes 1984 Third Quarter 37.5 Fourth Quarter 39.6 1985 First Quarter 39.6 1992 First Quarter 85.6 1999 First Quarter 135.6 2006 First Quarter 98.1 Second Quarter 41.5 Second Quarter 86.5 Second Quarter 138.1 Second Quarter 95.3 Third Quarter 42.8 Third Quarter 87.9 Third Quarter 138.3 Third Quarter 94.0 Fourth Quarter 43.3 Fourth Quarter 89.8 Fourth Quarter 140.3 Fourth Quarter Total 1985 167.1 Total 1992 349.7 Total 1999 552.3 Total 2006 1986 First Quarter 43.0 1993 First Quarter 90.6 2000 First Quarter 142.8 Second Quarter 44.8 Second Quarter 91.2 Second Quarter 142.9 Third Quarter 46.7 Third Quarter 93.6 Third Quarter 141.3 Fourth Quarter 48.5 Fourth Quarter 95.9 Fourth Quarter 139.9 Total 1986 183.1 Total 1993 371.2 Total 2000 566.9 1987 First Quarter 51.2 1994 First Quarter 98.7 2001 First Quarter 138.1 Second Quarter 52.5 Second Quarter 97.9 Second Quarter 137.1 Third Quarter 55.0 Third Quarter 101.9 Third Quarter 133.3 Fourth Quarter 57.0 Fourth Quarter 102.9 Fourth Quarter 131.3 Total 1987 215.7 Total 1994 401.4 Total 2001 539.8 1988 First Quarter 59.0 1995 First Quarter 105.6 2002 First Quarter 124.8 Second Quarter 59.6 Second Quarter 106.8 Second Quarter 124.4 Third Quarter 62.1 Third Quarter 109.0 Third Quarter 119.6 Fourth Quarter 64.0 Fourth Quarter 110.6 Fourth Quarter 118.0 Total 1988 244.6 Total 1995 431.9 Total 2002 486.8 1989 First Quarter 66.2 1996 First Quarter 115.7 2003 First Quarter 114.2 Second Quarter 68.5 Second Quarter 114.7 Second Quarter 112.1 Third Quarter 69.7 Third Quarter 117.5 Third Quarter 109.9 Fourth Quarter 72.6 Fourth Quarter 120.2 Fourth Quarter 107.8 Total 1989 277.1 Total 1996 468.1 Total 2003 444.0 1990 First Quarter 74.7 1997 First Quarter 122.1 2004 First Quarter 109.3 Second Quarter 75.8 Second Quarter 124.4 Second Quarter 106.1 Third Quarter 77.9 Third Quarter 124.9 Third Quarter 105.1 Fourth Quarter 79.1 Fourth Quarter 125.8 Fourth Quarter 102.0 Total 1990 307.4 Total 1997 497.3 Total 2004 422.5 1991 First Quarter 79.2 1998 First Quarter 124.0 2005 First Quarter 101.2 Second Quarter 81.9 Second Quarter 131.3 Second Quarter 100.4 Third Quarter 82.6 Third Quarter 130.7 Third Quarter 100.5 Fourth Quarter 84.4 Fourth Quarter 132.8 Fourth Quarter 98.8 Total 1991 328.0 Total 1998 518.8 Total 2005 400.9 (In Billions) Table 10.1 Interstate Switched Access Minutes for Incumbent Local Exchange Carriers (In Billions) Source: National Exchange Carrier Association (NECA), MOU/Data/Summary of NECA's Total Pool Results, September 30, 2006. Industry Analysis and Technology Division, Wireline Competition Bureau, Universal Service Monitoring Report (December 2006). Chart 10.1 Interstate Switched Access Minutes for Incumbent Local Exchange Carriers 0.0 100.0 200.0 300.0 400.0 500.0 600.0 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 10 - 3 Table 10.2 Telephone Calls and Billed Access Minutes of Large ILECs Reporting to the Commission Number of Telephone Calls InterLATA Billed Access Minutes (Thousands) Carried by IXCs (Originating and Terminating) (Thousands) Toll Calls Completed 1 (Originating) Number of Local Calls Total InterLATA InterLATA Year Carriers Carried by InterLATA Interstate Intrastate Total Interstate Intrastate the ILECs Carried by Carried by Carried by IXCs IXCs IXCs 1984 75 350,391,981 NA NA NA NA NA NA NA NA 1985 55 365,304,830 NA NA NA NA NA NA NA NA 1986 57 372,296,473 NA NA NA NA NA NA NA NA 1987 52 379,864,264 NA NA NA NA NA NA NA NA 1988 52 379,035,883 67,547,342 18,983,768 48,563,574 36,752,925 11,810,649 NA NA NA 1989 51 389,383,322 68,547,451 19,406,222 49,141,229 37,593,867 11,547,362 NA NA NA 1990 51 402,492,293 63,359,346 20,263,554 43,095,792 31,888,748 11,207,044 NA NA NA 1991 52 416,213,954 67,333,207 23,337,553 43,995,654 32,126,555 11,869,099 405,456,048 305,745,611 99,710,437 1992 54 434,175,743 71,502,090 22,612,572 48,889,518 36,036,032 12,853,486 432,356,515 327,821,281 104,535,234 1993 53 447,473,714 78,077,246 23,757,662 54,319,584 38,746,788 15,572,796 465,270,369 351,022,599 114,247,770 1994 52 465,207,539 83,441,709 23,796,633 59,645,076 43,244,593 16,400,483 500,297,267 374,996,101 125,301,166 1995 53 484,195,345 94,051,667 23,327,801 70,723,866 50,618,771 20,105,095 549,982,263 405,579,546 144,402,717 1996 51 504,131,507 94,905,927 21,376,847 73,529,080 52,677,037 20,852,043 598,563,946 438,772,880 159,791,066 1997 51 522,025,261 98,424,977 21,844,925 76,580,052 54,563,338 22,016,714 647,813,708 469,638,292 178,175,416 1998 52 544,288,934 96,934,938 18,469,316 78,465,622 55,974,210 22,491,412 690,523,467 497,138,901 193,384,566 1999 52 553,853,237 102,245,666 18,116,240 84,129,426 57,806,961 26,322,465 739,042,459 519,272,905 219,769,554 2000 52 536,523,081 105,978,596 16,157,912 89,820,684 59,212,055 30,608,629 792,263,836 535,011,649 257,252,187 2001 52 515,335,676 97,849,444 14,970,794 82,878,650 53,319,645 29,559,005 745,754,124 504,026,109 241,728,015 2002 52 459,302,668 89,997,279 13,339,232 76,658,047 47,968,133 28,689,914 668,089,004 451,602,651 216,486,353 2003 54 424,617,408 81,217,462 11,880,332 69,337,130 43,385,840 25,951,290 612,805,855 414,701,831 198,104,024 2004 56 381,069,716 82,396,083 10,199,173 72,196,910 47,627,234 24,569,676 601,798,650 407,004,711 194,793,939 2005 56 336,641,880 76,920,931 9,325,876 67,595,055 45,293,132 22,301,207 565,822,068 384,323,165 181,498,903 1 Excludes IntraLata toll carried by interexhange carriers. NA - Not available. Notes: Between 1987 and 1988, there were significant changes in the definitions of many of the items in this table due to the implementation of a new Uniform System of Accounts (USOA) in 1988. In 1992, some of these definitions were further refined when the reporting mechanism of the carriers was changed for the filing of 1991 data. For these reasons, there may be inconsistencies in the data reported for 1984-1987 compared to what was reported for 1988, and also between 1988 and subsequent years, as the carriers were adapting to the new USOA and automated reporting requirements. ILEC is an abbreviation for incumbent local exhange carrier. IXC is an abbreviation for interexchange carrier. Source: Industry Analysis and Technology Division, Wireline Competition Division, Statistics of Communications Common Carriers 2004/2005 Edition (November 2005), and ARMIS 43-08 reports. Totals may be understated because certain data pertaining to the carriers included in this table are not available. Data for the year 2005 are preliminary. IntraLATA carried by ILECs Total 1 10 - 4 11 - 1 11 Mobile Wireless Service 1. Industry Statistics There are several measures of mobile wireless subscribers. While there are some differences in these data series, they all show significant growth in mobile wireless subscribers. The Commission collects data on the number of wireless subscribers by state as part of the local competition and broadband data gathering program (FCC Form 477). This program requires providers of wireless service to file information twice each year. Prior to June 2005, only wireless carriers with at least 10,000 subscribers in a state were required to report. 1 The Commission also collects data on wireless numbers as part of the data collection on Numbering Resources and Utilization/Forecasting (FCC Form 502). Wireless numbers are a good proxy for wireless subscribers since wireless carriers generally assign only one subscriber per number. The CTIA-The Wireless Association TM periodically publishes summary information on the industry. CTIA can be found on the Internet at www.ctia.org. Table 11.1 and Chart 11.1 show three measures of mobile wireless subscribers over time. In 1984 there were 92,000 subscribers, as compared with over 217 million subscribers as of June 30, 2006. Table 11.2 shows the number of wireless subscribers per state as of June 30, 2006 using data from FCC Form 477. Table 11.3 provides information on the industry published by CTIA. These trends include revenues, cell sites, employees, and average monthly bills. The table shows that the industry had more than 233 thousand employees as of December 31, 2005, as compared to about 3,500 employees in 1986; and there was a significant drop in the average monthly bill from $96.83 at the end of 1987 to $49.98 as of December 2005. 2. Residential Wireless Toll Calling Patterns The summary of residential wireless usage presented in Tables 11.4 through 11.7 is based on calling data captured from a sample of consumer bills by TNS Telecoms. (For additional information on TNS Telecoms, see Appendix B.) While these tables were constructed similar to those describing wireline toll calling patterns in Section 14, the two sets of tables should be compared with caution. In most cases, wireless bills contain an itemization of all calls, rather than just toll calls. 2 As a result, these tables characterize wireless local and long-distance calling where the tables in Section 14 only cover wireline long distance. To provide some frame of reference, wireline distinctions have 1 Mobile telephony service providers with fewer than 10,000 subscribers in a state reported about 389,000 subscribers as of June 30, 2005. Such filers reported (on a voluntary basis) about 69,000 subscribers six months earlier. 2 In fact, since this analysis generally includes all outgoing wireless calls, many of the calls in the data are not traditional voice calls. The data include calls made to access voicemail, move data, access the Internet, send faxes or text messages, etc. 11 - 2 been imposed on the wireless calling data. That is, we distinguished wireless interstate from intrastate calls. Table 11.4 shows the estimated distribution of residential wireless calls and minutes over time. The vast majority of both calls and minutes were intrastate. Over time, however, this pattern is weakening. The number of interstate calls rose from 9% to 16% of the total from 2000 to 2005, and interstate minutes rose from 16% to 28% of the total over the same period. We note that these figures are estimates, based on sample data, and the distribution of calls and minutes may vary across carriers. A snapshot of the duration of wireless calls is presented in Table 11.5. In the 2005 data shown, wireless calls were brief. Almost 73% of intrastate wireless calls (which, again, represent the vast majority of calls) were 2 minutes or less. Like wireline traffic, the data are right-skewed such that a handful of long calls pull the average call duration far above the median duration. As a measure of central tendency, the median is more representative of the duration of a typical call than is the average in this context. Tables 11.6 and 11.7 show when wireless intrastate and interstate calls, respectively, were made. Over the years shown, patterns in intrastate calls have changed only slightly. Daytime minutes gained share from nighttime minutes (from about 70% in 2003 to about 72% in 2005), and weekend use fell as a share of total use. Traffic was typically heaviest on Friday and lightest on Sunday. Patterns in interstate calling were different. Unlike intrastate calls, interstate calls were generally most likely on the weekend, particularly on Sunday. Further, though both types of calls were more likely during the day than at night, relative to intrastate calls, interstate calls were allocated more to the nighttime hours. Nonetheless, the same forces acting to change intrastate calling patterns over the years shown seem to be having similar, yet more dramatic effects on interstate calling. For example, like intrastate calls, the share of interstate minutes made during the day increased, from about 59% of the total in 2003 to 63% in 2005. While weekend use remained flat from 2003 to 2004 at about 41%, the share fell to 38% in 2005. 1984 December 92 1985 June 204 December 340 1986 June 500 December 682 1987 June 884 December 1,231 1988 June 1,609 December 2,069 1989 June 2,692 December 3,509 1990 June 4,369 December 5,283 1991 June 6,390 December 7,557 1992 June 8,893 December 11,033 1993 June 13,067 December 16,009 1994 June 19,284 December 24,134 1995 June 28,154 December 33,786 1996 June 38,195 December 44,043 1997 June 48,706 December 55,312 1998 June 60,831 December 69,209 1999 June 76,285 December 86,047 79,696 2000 June 97,036 90,643 December 109,478 101,043 99,019 2001 June 118,398 114,029 111,734 December 128,375 123,991 128,493 2002 June 134,561 130,751 136,927 December 140,767 138,878 141,776 2003 June 148,066 147,624 151,861 December 158,722 157,042 160,637 2004 June 169,467 167,313 170,406 December 182,140 181,105 184,819 2005 June 194,479 192,053 198,381 December 207,896 203,667 213,212 2006 June 219,420 217,418 NA NA indicates not available 1 See Industry Analysis and Technology Division, Wireline Competition Bureau, Local Telephone Competition: Status as of June 30, 2006 (January 2007). Carriers with under 10,000 lines in a state were not required to report until June 2005. 2 Numbers are adjusted for porting. See current and previous editions of Industry Analysis and Technology Division, Wireline Competition Bureau, Numbering Resource Utilization in the United States . Source: CTIA-The Wireless Association TM and FCC Forms 477 and 502. FCC Form 502 contains assigned wireless numbers. 11 - 3 (In Thousands) Table 11.1 Measures of Mobile Wireless Telephone Subscribers FCC Form 502 2 Reported by CTIA Subscribers FCC Form 477 1 (Subscribers in Thousands) Mobile Wireless Telephone Subscribers As of December Chart 11.1 0 50,000 100,000 150,000 200,000 250,000 CTIA 5,283 7,557 11,033 16,009 24,134 33,786 44,043 55,312 69,209 86,047 109,478 128,375 140,767 158,722 182,140 207,896 FCC Form 477 79,696 101,043 123,991 138,878 157,042 181,105 203,667 FCC Form 502 99,019 128,493 141,776 160,673 184,819 213,212 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 11 - 4 2002 2006 Jun Jun Jun Jun Jun Dec Jun Dec Jun Alabama 12 5 % 1,253,084 1,930,631 2,027,845 2,100,557 2,301,847 2,580,810 2,843,385 3,071,359 3,240,669 Alaska 10 1 169,892 218,424 242,133 * 307,323 321,152 340,507 376,695 397,429 American Samoa * * 0 0 0 0 * * * * * Arizona 10 9 1,624,668 2,018,410 2,412,998 2,643,952 3,079,657 3,299,222 3,547,280 3,849,152 4,158,483 Arkansas 6 7 715,467 891,275 1,130,302 1,351,291 1,376,564 1,458,673 1,681,404 1,781,266 1,925,696 California 11 4 12,283,369 14,184,625 16,007,376 18,892,619 21,575,797 23,457,761 24,598,429 25,564,483 27,524,044 Colorado 9 10 1,654,989 1,983,405 2,247,166 2,426,929 2,727,910 2,808,195 3,053,186 3,260,286 3,442,153 Connecticut 5 6 1,136,618 1,418,367 1,577,873 1,791,944 2,064,204 2,181,133 2,332,045 2,466,372 2,585,425 Delaware 4 6 275,219 389,284 433,059 503,353 593,452 646,064 710,853 751,042 790,189 Dist. of Columbia 4 5 333,815 382,457 415,399 520,182 555,958 657,774 746,529 819,061 872,184 Florida 8 5 4,983,478 7,536,670 8,607,715 10,252,348 11,916,615 13,169,278 12,577,898 12,521,686 14,125,590 Georgia 10 6 2,687,238 4,076,119 4,300,831 4,709,288 5,332,517 5,730,223 6,023,302 6,103,234 6,891,999 Guam * 0 ****** *61,670 66,767 Hawaii 4 3 454,364 543,283 640,247 732,262 819,262 880,965 935,189 983,998 1,011,076 Idaho 15 6 296,066 398,781 500,693 572,406 653,779 705,948 777,445 838,095 905,581 Illinois 9 6 4,309,660 5,621,044 5,409,370 6,834,217 7,529,966 8,075,938 8,575,211 9,026,588 9,540,120 Indiana 8 11 1,717,378 1,781,247 2,032,290 2,456,509 2,844,568 3,158,002 3,276,910 3,536,228 3,781,322 Iowa 46 10 975,629 861,382 1,157,580 1,250,305 1,445,711 1,557,542 1,593,673 1,767,830 1,820,681 Kansas 13 10 724,024 901,225 1,061,171 1,195,230 1,345,160 1,454,087 1,538,945 1,666,340 1,771,588 Kentucky 10 10 999,544 1,176,756 1,505,982 1,595,290 2,000,459 2,189,345 2,495,494 2,649,143 2,807,061 Louisiana 8 6 1,294,693 1,677,292 2,187,811 2,365,224 2,547,153 2,834,716 2,997,513 3,258,336 3,425,482 Maine 6 12 283,640 399,616 457,835 524,246 610,533 662,623 785,814 823,242 870,197 Maryland 6 6 2,013,058 2,446,818 2,684,441 3,108,086 3,575,747 3,900,172 4,177,782 4,470,611 4,719,558 Massachusetts 5 6 2,228,169 2,753,685 3,289,934 3,506,039 3,919,139 4,042,592 4,316,120 4,544,572 4,724,175 Michigan 11 7 3,423,535 4,071,091 4,758,538 4,889,269 5,430,637 5,766,616 6,238,846 6,613,341 6,872,249 Minnesota 9 10 1,595,560 2,014,317 2,254,895 2,564,783 2,823,079 2,973,126 3,124,214 3,370,196 3,532,420 Mississippi 9 7 509,038 993,781 1,106,700 1,232,750 1,411,277 1,517,702 1,627,762 1,817,099 1,919,199 Missouri 11 8 1,848,775 1,937,684 2,246,430 2,515,325 2,859,953 3,109,167 3,482,839 3,732,549 3,942,213 Montana 7 4 * * 291,429 343,160 * * 467,795 526,954 577,149 Nebraska 8 4 600,885 712,685 838,568 900,744 984,355 1,045,810 1,078,955 1,169,068 1,208,393 Nevada 8 7 825,163 766,581 895,586 1,077,380 1,319,684 1,463,370 1,605,708 1,778,411 1,884,304 New Hampshire 6 8 309,263 445,181 529,795 598,504 686,746 727,985 916,833 989,443 1,049,150 New Jersey 4 4 2,750,024 3,896,778 4,531,457 5,392,240 6,326,459 7,388,722 7,269,330 7,723,622 8,120,504 New Mexico 10 8 395,111 619,582 735,107 828,869 939,091 987,813 1,025,143 1,170,436 1,252,943 New York 10 7 5,016,524 6,749,096 7,915,526 8,829,070 9,939,759 10,834,741 11,901,311 12,634,420 13,338,040 North Carolina 14 6 2,730,178 3,377,331 4,610,120 4,305,521 4,875,916 5,363,630 5,496,422 5,784,334 6,200,866 North Dakota 6 3 * * * * * * 388,609 454,456 481,655 Northern Mariana Isl. * * * * * * * * * * * Ohio 12 8 3,278,960 4,255,934 4,887,376 5,659,459 6,188,081 6,627,910 7,056,675 7,571,540 8,010,972 Oklahoma 15 8 979,513 1,200,234 1,366,475 1,574,588 1,724,505 1,760,122 2,000,787 2,187,424 2,315,999 Oregon 10 8 1,082,425 1,268,909 1,473,883 1,682,036 1,894,285 2,029,224 2,128,710 2,417,992 2,567,147 Pennsylvania 10 8 3,850,372 4,378,216 4,987,067 5,681,653 6,420,037 7,037,296 7,340,862 7,881,534 8,283,918 Puerto Rico 6 1 1,090,005 1,374,747 1,136,619 1,401,599 1,698,702 2,076,698 2,002,851 2,110,798 2,170,540 Rhode Island 4 8 313,550 401,805 463,636 527,366 615,398 607,489 653,900 709,525 726,483 South Carolina 12 6 1,236,338 1,502,345 1,830,516 2,041,541 2,337,367 2,369,252 2,593,000 2,768,481 2,984,417 South Dakota 6 3 * * 292,210 344,825 382,906 428,513 435,063 482,623 515,139 Tennessee 12 7 1,876,444 2,251,208 2,660,068 2,800,735 3,171,487 3,531,286 3,791,154 4,114,401 4,401,813 Texas 30 7 6,705,423 8,294,338 9,650,715 10,776,234 12,091,134 13,092,007 14,402,814 15,620,248 16,902,077 Utah 9 6 692,006 833,492 970,854 1,094,563 1,229,029 1,345,205 1,415,896 1,531,763 1,651,606 Vermont 4 15 ****** 295,971 315,382 334,655 Virgin Islands * * 0 **** *** Virginia 8 6 2,447,687 3,059,420 3,429,450 3,879,582 4,392,319 4,240,462 4,900,018 5,126,216 5,382,292 Washington 10 9 2,144,767 2,493,214 2,849,043 3,102,750 3,567,896 3,770,602 3,995,325 4,177,196 4,418,314 West Virginia 10 14 347,916 452,036 549,722 579,983 713,657 761,658 821,103 858,599 964,977 Wisconsin 12 7 1,342,908 2,008,679 2,523,956 2,533,215 2,831,645 2,997,029 3,191,190 3,355,951 3,505,936 Wyoming 7 6 * 173,939 168,232 276,344 277,658 302,203 330,567 358,593 376,753 Nationwide 160 7 % 90,643,058 114,028,928 130,751,459 147,623,734 167,313,001 181,105,135 192,053,067 203,667,472 217,418,404 2 Percentage of mobile wireless subscribers receiving their service from a mobile wireless reseller. * Data withheld to maintain firm confidentiality. Some data for December 2005 have been revised. Subscribers 2004State 2003 2005 Source: Industry Analysis and Technology Division, Wireline Competition Bureau. Local Telephone Competition: Status as of June 30, 2006 (January 2007). Table 11.2 Mobile Wireless Telephone Subscribers 1 1 For data through December 2004, only facilities-based wireless carriers with at least 10,000 mobile telephony subscribers per state were required to report data, and they were instructed to use billing addresses to determine subscriber counts by state. Starting with the June 2005 data, all facilities-based wireless carriers are required to report, and to use the area codes of telephone numbers provided to subscribers to determine subscriber counts by state. Jun 2006 Carriers 1 Percent Resold 2 2000 2001 11 - 5 Table 11.3 Mobile Wireless Telephone Service: Industry Survey Results (As Reported by CTIA-The Wireless Association TM ) Employees 1986 June 500,000 $360,585 1,194 3,556 December 681,825 462,467 1,531 4,334 1987 June 883,778 479,514 1,732 5,656 December 1,230,855 672,005 2,305 7,147 $96.83 1988 June 1,608,697 886,075 2,789 9,154 95.00 December 2,069,441 1,073,473 $89,331 3,209 11,400 98.02 1989 June 2,691,793 1,406,463 121,368 3,577 13,719 85.52 December 3,508,944 1,934,132 173,199 4,169 15,927 89.30 1990 June 4,368,686 2,126,362 192,350 4,768 18,973 83.94 December 5,283,055 2,422,458 263,660 5,616 21,382 80.90 1991 June 6,380,053 2,653,505 302,329 6,685 25,545 74.56 December 7,557,148 3,055,017 401,325 7,847 26,327 72.74 1992 June 8,892,535 3,633,285 436,725 8,901 30,595 68.51 December 11,032,753 4,189,441 537,146 10,307 34,348 68.68 1993 June 13,067,318 4,819,259 587,347 11,551 36,501 67.31 December 16,009,461 6,072,906 774,266 12,824 39,775 61.48 140 1994 June 19,283,306 6,519,030 778,116 14,740 45,606 58.65 December 24,134,421 7,710,890 1,052,666 17,920 53,902 56.21 119 1995 June 28,154,414 8,740,352 1,120,337 19,833 60,624 52.42 December 33,785,661 10,331,614 1,422,233 22,663 68,165 51.00 119 1996 June 38,195,466 11,194,247 1,314,943 24,802 73,365 48.84 December 44,042,992 12,440,724 1,465,992 30,045 84,161 47.70 125 1997 June 48,705,553 13,134,551 1,392,440 38,650 97,039 43.86 December 55,312,293 14,351,082 1,581,765 51,600 109,387 42.78 117 1998 June 60,831,431 15,286,660 1,584,891 57,674 113,111 39.88 December 69,209,321 17,846,515 1,915,578 65,887 134,754 39.43 136 1999 June 76,284,753 19,368,304 1,922,416 74,157 141,929 40.24 December 86,047,003 20,650,185 2,163,001 81,698 155,817 41.24 185 2000 June 97,035,925 24,645,365 1,971,625 95,733 159,645 45.15 December 109,478,031 27,820,655 1,911,356 104,288 184,449 45.27 255 2001 June 118,397,734 30,905,721 1,727,058 114,059 186,317 45.56 December 128,374,512 34,410,513 2,209,387 127,540 203,580 47.37 380 2002 June 134,561,370 36,707,086 1,846,267 131,350 186,956 47.42 December 140,766,842 39,801,101 2,049,245 139,338 192,410 48.40 427 2003 June 148,065,824 41,384,171 1,825,243 147,719 187,169 49.46 December 158,721,981 46,239,922 1,941,024 162,986 205,629 49.91 507 2004 June 169,467,393 49,275,671 2,015,780 174,368 212,368 49.49 December 182,140,362 52,845,539 2,194,532 175,725 226,016 50.64 584 2005 June 194,479,364 55,689,208 1,941,960 178,025 225,162 49.52 December 207,896,198 57,849,013 1,844,371 183.689 233,067 49.98 740 Source: CTIA-The Wireless Association TM : Estimates for Total Industry. Subscribers (Thousands) Six-Month Revenues (Thousands) Cell SitesRoamer Service Revenues Month Bill Average Minutes of Use per Average Monthly 11 - 6 Table 11.4 Distribution of Residential Wireless Calls and Minutes 1 Type 2000 2001 2002 2003 2004 2005 Calls Intrastate 87 % 84 % 82 % 82 % 82 % 81 % Interstate 9 1 13131415 Others 2 4 55544 Total Calls in Sample 295,892 330,444 502,946 547,767 508,799 506,072 Minutes Intrastate 82 % 76 % 71 % 71 % 70 % 70 % Interstate 16 22 26 27 28 28 Others 2 2 22322 Total Minutes in Sample 760,380 952,993 1,614,341 1,797,559 1,690,428 1,717,643 1 Outgoing, itemized calls only. 2 Inter-, intrastate status could not be determined. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Note: Individual figures may not add to totals due to rounding. Some previously published figures have been revised. 11 - 7 Table 11.5 Duration of Residential Wireless Calls: 2005 1 Duration of Call (Minutes) Intrastate Interstate All Calls 1 50.0 % 40.5 % 48.5 % 2 22.8 20.4 22.5 3 8.3 7.0 8.1 4 4.5 4.4 4.5 5 2.9 3.3 3.0 6 2.1 2.6 2.1 7 1.5 2.2 1.6 8 1.2 1.9 1.3 9 0.9 1.5 1.0 10 0.8 1.4 0.9 11-15 2.3 4.9 2.7 16-20 1.1 2.9 1.4 21-25 0.6 1.9 0.8 26-30 0.3 1.3 0.5 31-45 0.5 2.2 0.7 46-60 0.2 0.8 0.3 > 60 0.1 0.8 0.2 Average Duration 3.1 5.9 3.5 Median Duration 1.1 2.0 2.0 Sample Size 384,751 73,762 458,513 Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ . 1 Outgoing, itemized calls only. All seven-digit dialed calls are considered intrastate. 800-type calls and calls for which a cross-state distinction could not be made were excluded from this analysis. Note: Individual figures may not add to totals due to rounding. 11 - 8 Table 11.6 Distribution of Residential Intrastate Wireless Minutes By Day and Time 1 2005 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 10.2 % 4.0 % 14.2 % Tuesday 10.7 4.1 14.8 Wednesday 10.9 4.1 15.0 Thursday 11.0 4.4 15.4 Friday 11.6 3.9 15.4 Saturday 9.8 3.7 13.4 Sunday 8.0 3.7 11.7 Total 72.1 % 27.9 % 100.0 % Calls in sample = 384,751. 2004 Source: Calculate 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 10.0 % 4.0 % 14.0 % Tuesday 10.5 4.4 14.9 Wednesday 10.4 4.4 14.9 Thursday 10.6 4.2 14.8 Friday 11.2 4.2 15.4 Saturday 10.3 3.9 14.2 Sunday 8.0 3.8 11.8 Total 71.1 % 28.9 % 100.0 % Calls in sample =397,124. 2003 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 9.8 % 4.2 % 14.0 % Tuesday 9.9 4.2 14.2 Wednesday 9.8 4.4 14.2 Thursday 10.5 4.4 14.9 Friday 11.1 4.3 15.3 Saturday 10.9 3.9 14.8 Sunday 8.4 4.3 12.6 Total 70.3 % 29.7 % 100.0 % Calls in sample = 426,727. Note: Individual figures may not add to totals due to rounding. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. 1 Outgoing, itemized calls only. All seven-digit dialed calls are considered intrastate. 800-type calls and calls for which a cross-state distinction could not be made were excluded from this analysis. 11 - 9 Table 11.7 Distribution of Residential Interstate Wireless Minutes By Day and Time 1 2005 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 7.4 % 5.2 % 12.6 % Tuesday 6.9 5.1 12.0 Wednesday 7.0 5.3 12.3 Thursday 7.2 5.1 12.3 Friday 7.9 4.8 12.7 Saturday 13.2 4.7 17.9 Sunday 13.4 6.9 20.3 Total 62.9 % 37.1 % 100.0 % Calls in sample = 73,762. 2004 Source: Calculate 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 6.4 % 4.8 % 11.2 % Tuesday 6.3 5.2 11.5 Wednesday 6.9 5.4 12.2 Thursday 7.0 5.1 12.1 Friday 7.1 4.6 11.7 Saturday 14.0 5.2 19.2 Sunday 14.4 7.6 22.0 Total 62.0 % 38.0 % 100.0 % Calls in sample = 66,332. 2003 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 6.4 % 5.5 % 11.9 % Tuesday 6.3 5.6 11.9 Wednesday 6.5 5.8 12.3 Thursday 6.3 5.9 12.2 Friday 6.3 4.7 11.0 Saturday 13.6 5.7 19.3 Sunday 13.6 7.9 21.5 Total 59.0 % 41.0 % 100.0 % Calls in sample = 71,245. Note: Individual figures may not add to totals due to rounding. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. 1 Outgoing, itemized calls only. All seven-digit dialed calls are considered intrastate. 800-type calls and calls for which a cross-state distinction could not be made were excluded from this analysis. 11 - 10 12 - 1 12 Price Indices for Telephone Services The Bureau of Labor Statistics (BLS) collects a variety of information on telephone service as part of three separate programs -- the Consumer Price Index (CPI), the Producer Price Index (PPI), and the Consumer Expenditure Survey. They can be found on the Internet at www.bls.gov. The following material illustrates the range of information available from price indices. 1. Long-Term Trends in Price Indices A price index for telephone service was first published in 1935. Since that time, telephone prices have tended to increase at a slower pace than most other prices. Table 12.1 shows long-term changes in the consumer price indices for all items, all services, telephone services, each of the seven major categories that currently constitute the overall CPI and several services that are often characterized as being public utilities. Chart 12.1 shows the CPI telephone services trend as compared to the CPI all items trend from 1955 through 2005. 2. Comprehensive Price Indices The CPI index of telephone services is based on a market basket intended to represent the telephone-related expenditures of a typical urban household. It includes local, long distance, and cellular services. Beginning in 1987, the CPI for all items has consistently been higher than the CPI for telephone services as shown in Chart 12.1. The annual rates of change are shown in Table 12.2 and the associated chart for the overall CPI (which measures the impact of inflation on consumers) and the CPI for telephone services. In addition, Table 12.2 shows the gross domestic product chain-type price index (which measures inflation throughout the economy) prepared by the Department of Commerce’s Bureau of Economic Analysis. Chart 12.2 shows the annual percentage changes for the overall CPI and CPI for telephone services. 3. Price Indices for Local Service The CPI index of local telephone charges is based on a broadly defined market basket that includes: monthly service charges, message unit charges, leased equipment, installation, service enhancements (such as tone dialing and call waiting), taxes, and subscriber line charges. In contrast, the PPI index of monthly residential rates is much more narrowly defined. It is based only on monthly service charges for residential service, optional touch-tone service, and subscriber line charges. It excludes taxes, charges for special services such as call waiting, and all other expenditures. The annual rates of change for these indices of local costs are presented in Table 12.3 and Chart 12.3. 4. Price Indices for Long Distance Service Price indices are available for intrastate toll and interstate toll services. These series are also presented in Table 12.3 and Chart 12.3. 12 - 2 5. Price-Index Limitations Price indices are less reliable when industries are changing rapidly. For example, in 1992, long distance carriers began to increase basic rates while greatly expanding their range of discount offerings. The fixed market basket of toll calls measured for the CPI did not fully reflect these discounts. In 1995, BLS made major changes to the PPI telephone series, and there are no data after July 1995 comparable with prior data. Because of these sorts of difficulties, measures of average revenues are sometimes used as alternatives to price indices. 1955 - 2005 1995 - 2005 CPI All Items 4.1 % 2.5 % CPI All Services 5.0 3.2 CPI Telephone Services 1 1.7 -0.2 CPI Major Categories: - Food & Beverages * 2.5 - Housing * 2.8 - Apparel 2.1 -1.0 - Transportation 3.9 2.3 - Medical Care 5.9 3.9 - Recreation * 1.5 - Other Goods & Services * 4.2 CPI Public Transportation 5.1 2.1 CPI Utility (Piped) Gas Service 5.5 7.7 CPI Electricity 3.4 1.5 CPI Water & Sewerage Maintenance 5.6 3.7 CPI Postage 4.7 1.8 Source: Bureau of Labor Statistics. Long-Term Changes for Various Price Indices Chart 12.1 CPI All Items and CPI Telephone Services Base Periods: 1982-84 = 100 Table 12.1 (Annual Rates of Change) * Series not established until after 1955. 1 The CPI telephone service index was revised in December of 1997. 0 50 100 150 200 250 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 CPI All Items CPI Telephone Services 12 - 3 1978 7.3 % 9.0 % 0.9 % 1979 8.7 13.3 0.7 1980 9.7 12.5 4.6 1981 8.3 8.9 11.7 1982 5.2 3.8 7.2 1983 3.4 3.8 3.6 1984 3.6 3.9 9.2 1985 2.8 3.8 4.7 1986 2.3 1.1 2.7 1987 2.9 4.4 -1.3 1988 3.7 4.4 1.3 1989 3.5 4.6 -0.3 1990 4.1 6.1 -0.4 1991 3.1 3.1 3.5 1992 2.1 2.9 -0.3 1993 2.3 2.7 1.8 1994 2.2 2.7 0.7 1995 2.0 2.5 1.2 1996 1.9 3.3 2.1 1997 1.5 1.7 0.2 1998 1.1 1.6 0.3 * 1999 1.5 2.7 0.4 2000 2.3 3.4 -2.3 2001 2.5 1.6 1.3 2002 1.7 2.4 0.2 2003 2.0 1.9 -2.7 2004 2.9 3.3 -2.5 2005 3.1 3.4 0.4 * The CPI telephone service index was revised in December of 1997. Sources: Bureau of Labor Statistics and Bureau of Economic Analysis. Table 12.2 Annual Changes in Major Price Indices GDP Chain-Type Price Index CPI - All Items CPI - Telephone Services Percent Change in CPI All Items and CPI Telephone Services Chart 12.2 Note: All values calculated as the percent change from December of the previous year through December of the year shown, except the GDP price index which is based on changes from the 4th quarter to 4th quarter. -15% -10% -5% 0% 5% 10% 15% 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 Percent Cha n g e fro m Pri o r Yea r CPI - All Items CPI - Telephone Services 12 - 4 1978 1.4 % 3.1 % -0.7 % 0.0 % 1.3 % 0.1 % 1979 1.7 1.6 -0.8 -0.9 0.1 -0.7 1980 7.0 7.1 3.4 5.5 -0.6 2.3 1981 12.6 15.6 14.6 15.9 6.2 8.0 1982 10.8 9.0 2.7 3.9 4.2 1.7 1983 3.1 0.2 1.4 0.0 7.4 3.9 1984 17.2 10.4 -4.3 -5.1 3.6 3.8 1985 8.9 12.4 -3.7 -3.0 0.6 2.1 1986 7.1 8.9 -9.4 -10.0 0.3 -3.5 1987 3.3 2.6 -12.4 -11.8 -3.0 -3.0 1988 4.5 4.6 -4.2 -2.1 -4.2 -3.8 1989 0.6 1.9 -1.3 -1.7 -2.6 0.5 1990 1.0 1.5 -3.7 -0.1 -2.2 -2.2 1991 5.1 2.1 1.3 -1.3 -1.5 -2.6 1992 0.5 -0.2 -1.3 1.0 -2.4 1.3 1993 1.0 0.8 6.5 3.8 0.2 -1.1 1994 -0.3 0.7 5.4 6.1 -1.0 -1.4 1995 2.6 2 0.1 2 -3.8 2 1996 0.9 0.2 3.7 0.8 6.1 0.9 1997 1.0 0.1 -4.3 7.8 2.8 -4.3 1998 1.3 0.0 -0.8 -0.4 1.5 -3.7 1999 2.8 0.2 -0.7 2.4 -1.6 -2.8 2000 5.5 1.5 -11.2 -4.3 -6.0 0.2 2001 4.5 2.7 -2.0 -9.4 -1.7 1.7 2002 5.3 1.6 -5.9 -18.5 -6.1 -0.3 2003 2.6 1.9 -10.9 -2.4 -9.4 -12.6 2004 1.1 0.7 -8.7 0.7 -6.6 -2.9 2005 3.3 0.8 3 -3.0 8.5 3 0.4 -0.2 3 Note: Data reflect the percent change from December of the previous year through December of the year shown. Source: Bureau of Labor Statistics. CPI PPICPI PPI CPI PPI Table 12.3 Annual Changes in Price Indices for Local and Long Distance Telephone Services Local Residential Service Toll Service 1 Interstate Intrastate 3 Preliminary and subject to revision. 1 The CPI toll indices represent rates for households. Through 1994, PPI toll indices represent rate changes for both business and residential consumers. Since 1995, PPI indices reflect rates for residential customers. 2 The PPI telephone indices were revised in June of 1995. The series are not comparable. CPI Telephone Service Price Indices Chart 12.3 Base Periods: 1982-1984 = 100 0 20 40 60 80 100 120 140 160 180 200 220 1979 1981 1983 1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 CPI Local Services CPI Interstate Toll CPI Intrastate Toll 12 - 5 13-1 13 Price Levels 1. Local Rates The price indices maintained by the Bureau of Labor Statistics indicate percentage changes in the price of telephone services. BLS does not publish actual rate levels. Calculations of average rates are based on surveys by FCC staff. These surveys use the same sampling areas and weights used by BLS in constructing the Consumer Price Index. Table 13.1 presents average local rates for residential customers in urban areas. In October 2005, the average monthly charge was $24.74 while the average charge for connecting phone service was $42.71. Table 13.2 presents average local rates for a business with a single phone line in an urban area. In October 2005, the average monthly charge was $43.94 while the average charge for connecting phone service was $73.70. Table 13.3 presents the average local rate for a residential phone line from 1940 to 2005. The table shows, after adjusting for inflation, the price of a local exchange line declined from 1940 through the early 1980s. 2. Long Distance Rates Table 13.4 contains measures of average revenue per minute (ARPM) for long distance calls. Estimates of ARPM are often used interchangeably with estimates of the average price. From 1984 to 2004 the cost of long distance calling dropped from 32 cents per minute to 8 cents per minute. The average price of 8 cents per minute represents a mix of international calling (14 cents per minute) and domestic interstate calling (6 cents per minute). The decline in prices since 1984 is more than 85% after adjusting for the impact of inflation. Chart 13.1 shows that on a per minute basis, the cost of access and of contributing to universal service support has declined over time. These declines account for much of the decrease in interstate toll rates. 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1 2005 2 Representative Monthly Charge 3 4 $12.58 $12.44 $12.32 $12.30 $12.36 $13.03 $13.05 $13.16 $13.19 $13.62 $13.71 $13.67 $13.75 $13.77 $13.64 $14.49 $14.38 $14.54 $14.57 $14.75 Subscriber Line Charges 2.04 2.66 2.67 3.53 3.55 3.56 3.55 3.55 3.55 3.54 3.54 3.53 3.52 3.58 4.50 5.05 5.74 5.86 5.81 5.81 Additional Monthly Charge for Touch- Tone Service 1.57 1.52 1.54 1.52 1.33 1.06 0.97 0.94 0.77 0.44 0.30 0.25 0.10 0.09 0.06 0.04 4 4 4 4 Taxes, 911, and Other Charges 1.51 1.56 1.58 1.70 2.00 2.12 2.15 2.29 2.31 2.41 2.40 2.42 2.39 2.48 2.57 3.03 3.94 4.12 4.14 4.19 Total Monthly Charge $17.70 $18.18 $18.11 $19.05 $19.24 $19.77 $19.72 $19.95 $19.81 $20.01 $19.95 $19.88 $19.76 $19.93 $20.78 $22.62 $24.07 $24.75 $24.52 $24.74 Basic Connection Charge 4 $45.63 $44.04 $42.94 $43.06 $43.06 $42.00 $41.50 $41.38 $41.28 $40.91 $41.11 $41.04 $41.24 $41.26 $41.45 $40.02 $39.83 $39.22 $39.26 $39.30 Additional Connection Charge for Touch-Tone Service 1.34 1.31 1.55 1.76 1.77 1.27 1.22 1.23 0.85 0.23 0.23 0.17 0.12 0.12 0.12 0.12 4 4 4 4 Taxes, 911, and Other Charges 2.28 2.20 2.11 2.44 2.32 2.30 2.29 2.30 2.33 2.44 2.36 2.46 2.38 2.57 2.53 2.81 1.33 3.32 3.44 3.41 Total Connection Charge $49.25 $47.55 $46.60 $47.26 $47.15 $45.57 $45.01 $44.92 $44.46 $43.58 $43.70 $43.67 $43.74 $43.95 $44.10 $42.95 $41.16 $42.54 $42.71 $42.71 Additional Charge if Drop Line and Connection Block Needed NA NA $6.04 $6.07 $6.89 $6.89 $6.50 $7.29 $6.74 $5.90 $5.74 $5.65 $5.64 $5.86 $5.84 $5.84 $5.85 $12.13 $12.45 $12.45 Lowest-Cost Inside Wiring Maintenance Plan $0.58 $0.85 $0.89 $1.07 $1.07 $1.20 $1.25 $1.31 $1.45 $1.52 $1.78 $1.68 $2.22 $2.66 $3.03 $3.62 $3.62 $3.64 $4.08 $4.31 NA - Not Available. 3 Rates are based on flat-rate service where available, and measured/message service with one hundred five-minute, same-zone, business-day calls elsewhere. As of 2001, all 95 cities in the Urban Rates Survey offered flat-rate residential service, which made measuring the cost of such calls unnecessary. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Reference Book of Rates, Price Indices, and Household Expenditures for Telephone Service (2006) . 1 Revised. 4 Beginning in 2002, additional monthly charges for touch-tone service are included in the monthly charge. 2 Subject to revision. Table 13.1 Average Residential Rates for Local Service in Urban Areas, 1986 - 2005 (As of October 15) 13 - 3 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 1 2005 2 Monthly Representative Service Charge 3 $31.06 $30.97 $32.29 $32.45 $32.70 $32.25 $32.48 $32.58 $32.76 $32.44 $32.41 $32.18 $31.88 $30.86 $30.65 $32.11 $32.49 Subscriber Line Charges 3.55 3.57 3.57 3.56 3.57 3.57 3.57 3.54 3.54 3.54 3.52 4.39 4.91 5.63 5.76 5.71 5.72 Extra for Touch-Tone Service 4 2.43 2.35 1.84 1.71 1.67 1.21 0.97 0.82 0.38 0.32 0.25 0.19 0.18 4 4 4 4 Taxes, 911, and Other Charges 4.21 4.32 4.42 4.57 4.63 4.61 4.79 4.87 4.99 4.97 5.03 5.04 5.45 5.47 5.55 5.67 5.74 Total Monthly Charge $41.25 $41.21 $42.12 $42.29 $42.57 $41.64 $41.80 $41.81 $41.67 $41.27 $41.21 $41.80 $42.43 $41.95 $41.97 $43.49 $43.94 Monthly Charge for Flat-Rate Service $33.04 $33.29 $34.12 $34.06 $34.85 $34.39 $34.45 $34.42 $34.68 $34.39 $33.73 $33.45 $32.02 $32.92 $33.17 $34.20 $34.15 Subscriber Line Charges 3.65 3.69 3.70 3.70 3.70 3.70 3.69 3.61 3.61 3.56 3.50 4.35 4.77 5.77 6.03 6.01 6.04 Extra for Touch-Tone Service 4 2.12 2.11 1.87 1.84 1.76 1.12 1.00 0.89 0.53 0.49 0.47 0.43 0.39 4 4 4 4 Taxes, 911, and Other Charges 4.90 4.98 5.22 5.34 5.50 5.36 5.58 5.55 5.58 5.63 5.49 5.68 5.98 8.16 7.91 7.53 7.71 Total Monthly Charge for Flat-Rate Service $43.71 $44.07 $44.91 $44.94 $45.81 $44.57 $44.71 $44.47 $44.39 $44.07 $43.20 $43.90 $43.15 $46.85 $47.12 $47.74 $47.90 Number of Sample Cities with Flat-Rate Service 59 56 54 54 54 53 53 53 53 54 54 54 56 52 52 56 56 Monthly Charge for Measured/Message Service $16.18 $16.17 $16.76 $16.55 $16.60 $16.74 $17.06 $17.26 $17.28 $17.16 $17.06 $16.92 $17.16 $17.56 $17.21 $18.49 18.02 200 Five-Minute Same-Zone Business-Day Calls 16.11 16.19 16.70 17.23 17.57 17.38 17.15 17.10 17.18 17.15 17.24 17.63 17.56 16.78 17.17 17.86 17.87 Subscriber Line Charges 3.54 3.55 3.55 3.54 3.55 3.55 3.54 3.51 3.51 3.53 3.52 4.39 4.90 5.56 5.65 5.86 5.66 Extra for Touch-Tone Service 4 2.48 2.39 1.87 1.73 1.68 1.22 0.98 0.83 0.39 0.33 0.25 0.20 0.19 4 4 4 4 Taxes, Including 911 Charges 4.41 4.53 4.56 4.77 4.86 4.83 5.01 5.13 5.22 5.19 5.28 5.32 5.76 4.71 4.78 5.07 4.72 Total Monthly Charge for Measured/Message Service $42.72 $42.83 $43.44 $43.82 $44.26 $43.72 $43.75 $43.84 $43.57 $43.35 $43.35 $44.45 $45.57 $44.61 $44.82 $47.29 $46.27 Number of Sample Cities with Measured/Message Service 83 83 84 84 84 87 87 86 85 85 85 85 85 86 85 86 86 Cost of a Five-Minute Same-Zone Business-Day Call $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.09 $0.10 $0.09 $0.09 $0.09 $0.10 $0.10 Basic Connection Charge $71.05 $71.36 $72.75 $72.55 $71.41 $69.88 $67.87 $68.47 $68.67 $65.83 $67.87 $67.77 $67.04 $67.29 $67.23 $67.24 $67.35 Additional Connection Charge for Touch-Tone Service 4 1.70 1.89 1.13 1.19 1.17 0.92 0.27 0.17 0.17 0.12 0.12 0.12 0.12 4 4 4 4 Taxes, Including 911 Charges 4.06 4.15 4.32 4.33 4.25 4.13 4.17 4.20 4.45 4.13 4.53 4.40 4.69 5.09 6.95 6.42 6.35 Total Connection Charge $76.81 $77.40 $78.20 $78.07 $76.83 $74.93 $72.31 $72.85 $73.29 $70.09 $72.55 $72.29 $71.86 $72.39 $74.18 $74.18 $73.70 Additional Charge if Drop Line and Connection Block Needed $5.92 $7.87 $6.90 $6.83 $6.64 $6.49 $7.28 $6.98 $6.54 $6.54 $6.65 $6.62 $6.62 $6.52 $13.43 $13.76 $13.76 Lowest-Cost Inside Wiring Maintenance Plan $1.78 $1.91 $2.05 $2.03 $2.08 $2.26 $2.39 $2.63 $2.84 $3.04 $3.53 $3.92 $4.86 $4.73 $4.65 $4.94 $5.73 Note: Details may not add to totals due to rounding. 1 Revised. 2 Subject to revision. 3 Rates are based on flat-rate service where available, and measured/message service with 200 five-minute, same-zone, business-day calls elsewhere. 4 Beginning in 2002, additional monthly charges for touch-tone service are included in the monthly charge. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Reference Book of Rates, Price Indices, and Household Expenditures for Telephone Service (2006) . Table 13.2 Average Local Rates for Businesses with a Single Line in Urban Areas, 1989 - 2005 (As of October 15) 13 - 4 Table 13.3 Average Rate for a Residential Access Line Consumer Average Rate Consumer Average Rate Price for a Price for a Index Residential Access Line Index Residential Access Line All Urban All Urban All Goods Survey Rate Restated All Goods Survey Rate Restated and Services in 2005 and Services in 2005 (1982-1984 Dollars (1982-1984 Dollars = 100) = 100) 1940 14.0 $3.67 $51.20 1978 65.2 $8.31 $24.89 1941 14.7 3.67 48.76 1979 72.6 8.40 22.60 1942 16.3 3.64 43.61 1980 82.4 8.61 20.41 1943 17.3 3.64 41.09 1981 90.9 9.16 19.68 1944 17.6 3.66 40.61 1982 96.5 10.18 20.60 1945 18.0 3.67 39.82 1983 99.6 13.58 26.63 1946 19.5 3.67 36.76 1984 103.9 15.18 28.53 1947 22.3 3.70 32.40 1985 107.6 16.26 29.51 1948 24.1 3.91 31.69 1986 109.6 17.70 31.54 1949 23.8 4.02 32.99 1987 113.6 18.18 31.25 1950 24.1 4.29 34.77 1988 118.3 18.11 29.90 1951 26.0 4.48 33.65 1989 124.0 19.05 30.00 1952 26.5 4.62 34.05 1990 130.7 19.24 28.75 1953 26.7 4.93 36.06 1991 136.2 19.77 28.35 1954 26.9 5.10 37.03 1992 140.3 19.72 27.45 1955 26.8 5.19 37.82 1993 144.5 19.95 26.96 1956 27.2 5.24 37.62 1994 148.2 19.81 26.11 1957 28.1 5.28 36.70 1995 152.4 20.01 25.64 1958 28.9 5.36 36.22 1996 156.9 19.95 24.83 1959 29.1 5.51 36.98 1997 160.5 19.88 24.19 1960 29.6 5.55 36.62 1998 163.0 19.76 23.68 1961 29.9 5.61 36.64 1999 166.6 19.93 23.36 1962 30.2 5.62 36.34 2000 172.2 20.78 23.57 1963 30.6 5.65 36.06 2001 177.1 22.62 24.94 1964 31.0 5.66 35.66 2002 179.9 24.07 26.13 1965 31.5 5.67 35.15 2003 184.0 24.75 26.27 1966 32.4 5.64 34.00 2004 188.9 24.52 25.35 1967 33.4 5.60 32.74 2005 195.3 24.74 24.74 1968 34.8 5.61 31.48 1969 36.7 5.68 30.23 1970 38.8 5.76 28.99 1971 40.5 6.04 29.13 1972 41.8 6.38 29.81 1973 44.4 6.69 29.43 1974 49.3 7.08 28.05 1975 53.8 7.32 26.57 1976 56.9 7.81 26.81 1977 60.6 8.07 26.01 Sources: Averages for 1940 through 1982 are from an AT&T local rate survey and represent January 1 rates. These averages exclude taxes and are for rotary service including the cost of a telephone. See Reference Book of Rates, Price Indices and Expenditures for Telephone Service, Wireline Competition Bureau, October 1995 and March 2005. Starting in 1983, averages are from the Urban Rates Survey and represent October 15 rates. These averages include taxes and are for touch tone service but do not include telephone rental charges or any unbundled inside wiring maintenance plan charges. 2005 rates are preliminary. 13 - 5 Table 13.4 Average Revenue per Minute Consumer Average Revenue Per Consumer Average Revenue Per Minute for Interstate and International Calls Price Minute for Interstate and Price Interstate and International Interstate Calls Index International Calls Index International Calls Calls 1/ All Goods Restated All Goods Restated Net of and Services in 2004 and Services in 2004 Access and (1982-1984 Dollars (1982-1984 Dollars Universal = 100) = 100) Service Cost 1930 16.7 $0.27 $3.11 1970 38.8 $0.23 $1.12 $2.43 $0.20 1931 15.2 0.27 3.35 1971 40.5 0.25 1.14 2.35 0.22 1932 13.7 0.26 3.62 1972 41.8 0.24 1.10 2.31 0.21 1933 13.0 0.28 4.00 1973 44.4 0.25 1.08 2.29 0.22 1934 13.4 0.27 3.84 1974 49.3 0.26 0.98 2.25 0.22 1935 13.7 0.27 3.66 1975 53.8 0.27 0.96 2.23 0.24 1936 13.9 0.25 3.41 1976 56.9 0.29 0.95 2.20 0.25 1937 14.4 0.22 2.84 1977 60.6 0.28 0.89 2.18 0.25 1938 14.1 0.21 2.87 1978 65.2 0.29 0.83 2.09 0.25 1939 13.9 0.22 2.93 1979 72.6 0.29 0.76 1.76 0.26 1940 14.0 0.21 2.84 1980 82.4 0.30 0.69 1.34 0.27 1941 14.7 0.21 2.67 1981 90.9 0.33 0.68 1.21 0.31 1942 16.3 0.22 2.50 1982 96.5 0.34 0.67 1.09 0.32 1943 17.3 0.21 2.30 1983 99.6 0.35 0.66 1.09 0.33 1944 17.6 0.22 2.31 1984 103.9 0.32 0.59 1.05 0.30 1945 18.0 0.21 2.23 1985 107.6 0.31 0.54 1.01 0.29 1946 19.5 0.20 1.91 1986 109.6 0.28 0.48 0.97 0.26 1947 22.3 0.19 1.62 1987 113.6 0.25 0.41 0.99 0.22 1948 24.1 0.19 1.46 1988 118.3 0.23 0.37 1.02 0.21 1949 23.8 0.19 1.50 1989 124.0 0.22 0.33 1.02 0.19 1950 24.1 0.19 1.51 1990 130.7 0.20 0.29 1.00 0.17 1951 26.0 0.20 1.46 1991 136.2 0.20 0.27 1.02 0.15 1952 26.5 0.20 1.44 1992 140.3 0.19 0.26 1.01 0.15 $0.09 1953 26.7 0.21 1.47 1993 144.5 0.19 0.25 1.02 0.15 0.09 1954 26.9 0.22 1.56 1994 148.2 0.18 0.23 0.93 0.14 0.08 1955 26.8 0.23 1.62 1995 152.4 0.17 0.21 0.91 0.12 0.07 1956 27.2 0.23 1.62 1996 156.9 0.16 0.20 0.76 0.12 0.08 1957 28.1 0.24 1.60 1997 160.5 0.15 0.17 0.69 0.11 0.06 1958 28.9 0.24 1.56 1998 163.0 0.14 0.17 0.58 0.11 0.08 1959 29.1 0.24 1.57 1999 166.6 0.14 0.16 0.54 0.11 0.08 1960 29.6 0.24 1.54 2000 172.2 0.12 0.13 0.52 0.09 0.06 1961 29.9 0.25 1.57 2001 177.1 0.10 0.11 0.35 0.08 0.06 1962 30.2 0.25 1.58 2002 179.9 0.09 0.09 0.28 0.07 0.05 1963 30.6 0.25 1.53 2003 184.0 0.08 0.08 0.20 0.07 0.05 1964 31.0 0.25 1.52 2004 188.9 0.08 0.08 0.14 0.06 0.05 1965 31.5 0.24 1.44 1966 32.4 0.24 1.42 1967 33.4 0.24 1.37 1968 34.8 0.24 1.28 1969 36.7 0.24 1.24 Note: Data for some prior years have been revised. 1/ Starting in 1992, billed revenue per minute for international service differs in Table 6.1 and Table 13.4. Data in Table 6.1 are calculated using all U.S. billed minutes and revenues. Data for Table 13.4 represent charges for most U.S. billed calls that originate or terminate in the United States. International-to-international revenues and reorigination, country-beyond and country-direct minutes are not included in this table. Sources: Estimates for 1930 through 1981 are based on information in AT&T's Long Lines Statistics, 1930-1963, 1946-1970, and 1960-1981, and appear to represent data for the conterminous U.S. only. Data prior to 1946 may not be comparable. Data for 1982 and 1983 were estimated using BLS price index changes. Data for 1984 through 1991 were supplied by AT&T. Starting with 1992, data are from the Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006), available at www.fcc.gov/wcb/stats. For 1970 through 1991, interstate revenue per minute was estimated using the combined interstate and international revenue per minute estimates shown in the table, and international revenue and revenue per minute data in Table 1 and Table 2 of Trends in the International Telecommunications Industry, September 2005. 13 - 6 Item 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Revenue per minute $0.087 $0.089 $0.078 $0.071 $0.075 $0.064 $0.077 $0.078 $0.064 $0.064 $0.052 $0.048 $0.048 retained by carrier Cost to carrier per minute for $0.062 $0.059 $0.058 $0.054 $0.049 $0.044 $0.037 $0.034 $0.026 $0.019 $0.018 $0.017 $0.015 access and universal service Chart 13.1 Revenue per Minute for Interstate Calls $0.00 $0.02 $0.04 $0.06 $0.08 $0.10 $0.12 $0.14 $0.16 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Revenue per minute retained by carrier Cost to carrier per minute for access and universal service 13 - 7 14 - 1 14 Residential Wireline Usage Bill Harvestingฎ data collected by TNS Telecoms provides information on actual usage in the residential telecom market as collected from the actual telecommunications bills of households. TNS Telecoms (TNS), a telecommunications market information firm, conducts nationwide surveys and Bill Harvestingฎ on a quarterly basis from over 120,000 households each year. These surveys, in which households are asked to mail copies of their phone bills for one month to TNS, are called Bill Harvesting studies. The company has donated databases containing information on residential phone usage to the Commission. The Bill Harvesting data reflect calls itemized on residential telephone bills for wireline service. Thus, 800 and 800-like calls made from the residence are not included, nor are collect calls made from the residence. In contrast, 800 and 800-like calls received, and shown on the household monthly bill, are included, as are collect calls received. Table 14.1 shows the percentage of residential wireline long distance telephone usage that is intrastate, interstate and international. In 2005, 36% of residential toll phone calls were interstate as opposed to 47% of minutes. Table 14.2 shows the average number of toll minutes on residential phone bills that are intrastate, interstate and international from 1995-2005. Table 14.3 shows the distribution of residential wireline long distance calls by call duration. The average interstate residential call lasts about nine minutes, although about 41% of interstate toll calls last one minute or less. Tables 14.4 and 14.5 show the duration and the average distance (sometimes called length of haul) of residential wireline intrastate and interstate long distance calls, respectively. The average distance of an interstate toll call in 2005 was 759 miles, as opposed to 55 miles for an intrastate toll call. Table 14.6 shows the percentage of residential wireline long distance minutes by day of week and time of day. Over the past three years, these data indicate that interlata wireline traffic has been slowly moving away from nights and weekends. Type 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 Calls IntraLATA-Intrastate 41 % 40 % 38 % 38 % 39 % 39 % 42 % 44 % 45 44 44 % InterLATA-Intrastate 19 18 19 19 18 17 18 17 17 17 16 IntraLATA-Interstate 11111111111 InterLATA-Interstate 37 35 37 36 37 36 36 34 33 34 35 International 11111111222 Others 1 25544522222 Total Calls in Sample 197,787 165,465 483,685 578,850 474,408 538,337 456,328 427,781 340,763 312,918 265,194 Minutes IntraLATA-Intrastate 28 % 29 % 27 % 27 % 28 % 29 % 30 % 32 % 35 32 32 % InterLATA-Intrastate 18 18 18 18 17 17 18 18 16 17 16 IntraLATA-Interstate 11111111111 InterLATA-Interstate 50 47 49 49 49 47 48 46 44 46 46 International 21112222233 Others 1 144335 11111 Total Minutes in Sample 1,493,674 1,210,675 3,673,315 4,330,888 3,544,905 4,030,643 3,319,982 2,992,644 2,308,266 2,088,773 1,766,565 Note: Figures may not add to totals due to rounding. 1 Toll-free (800, 888, 877, 866) calls billed to residential customers, 900 calls and calls that cannot be classified. Type 1998 1999 2000 2001 2002 2003 2004 2005 IntraLATA-Intrastate 40 41 41 40 36 33 32 28 25 18 17 InterLATA-Intrastate 26 26 27 26 23 19 19 16 12 10 8 IntraLATA-Interstate 1 1 1 1 1 1 1 1 1 1 0 InterLATA-Interstate 71 67 73 71 65 55 51 41 31 26 24 International 3 1 2 2 2 2 2 2 2 2 2 Others 1 1 6 6 5 4 5 1 1 1 1 0 All Types 143 143 149 144 131 116 105 90 71 56 51 Note: Figures may not add to totals due to rounding. 1 Toll-free (800, 888, 877, 866) minutes billed to residential customers, 900 minutes and minutes for calls that cannot be classified. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Table 14.1 Distribution of Residential Wireline Toll Calls and Minutes Table 14.2 Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Average Residential Wireline Monthly Toll Minutes 1995 1996 1997 14 - 3 Duration of Call (Minutes) Intrastate Interstate All Calls 1 48.0 % 40.7 % 45.2 % 2 14.4 11.1 13.2 3 7.6 5.9 6.9 4 4.8 4.1 4.5 5 3.4 3.4 3.4 6 2.6 2.8 2.7 7 2.1 2.4 2.2 8 1.7 2.1 1.9 9 1.4 1.8 1.6 10 1.4 2.1 1.7 11-15 4.2 6.6 5.2 16-20 2.5 4.4 3.2 21-25 1.6 3.1 2.2 26-30 1.1 2.3 1.5 31-45 1.7 3.9 2.5 46-60 0.7 1.7 1.1 > 60 0.7 1.7 1.1 Average Duration 5.4 8.8 6.7 Median Duration 2.0 2.0 2.0 Sample Size 151,343 93,495 244,838 Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Table 14.3 Distribution of Residential Wireline Long Distance Call Durations: 1 The sample includes domestic, directly-dialed calls. 2005 1 14 - 4 Duration Distance (In Minutes) (In Miles) Average Median Average Median 1995 6.0 2.0 53 26 1996 6.0 2.0 55 28 1997 6.2 2.0 56 28 1998 6.0 2.0 55 29 1999 6.0 2.0 54 29 2000 6.1 2.0 54 28 2001 5.9 2.0 53 29 2002 5.6 2.0 52 28 2003 5.6 2.0 51 28 2004 5.3 2.0 56 30 2005 5.4 2.0 55 29 Duration Distance (In Minutes) (In Miles) Average Median Average Median 1995 10.6 4.0 689 507 1996 10.0 4.0 670 473 1997 10.3 4.0 695 480 1998 10.3 4.0 691 493 1999 10.0 3.9 693 501 2000 10.0 4.0 706 524 2001 9.7 3.0 686 501 2002 9.4 3.0 692 489 2003 8.9 3.0 684 481 2004 8.9 2.0 721 525 2005 8.8 2.0 759 568 Table 14.5 Duration and Distance of Interstate Toll Calls 1 Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. 1 Direct-dial calls carried by long distance carriers and local exchange carriers. Includes only domestic calls. Duration and Distance of Intrastate Toll Calls 1 Table 14.4 Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. 1 Direct-dial calls carried by long distance carriers and local exchange carriers. Includes only domestic calls. 14 - 5 2005 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 8.9 % 5.6 % 14.6 % Tuesday 8.5 5.2 13.6 Wednesday 8.4 5.4 13.8 Thursday 8.7 5.4 14.1 Friday 8.6 4.3 13.0 Saturday 9.6 4.1 13.7 Sunday 11.3 6.0 17.2 Total 64.0 % 36.0 % 100.0 % Based on a sample of 133,257 directly-dialed, interLATA calls. 2004 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 8.6 % 5.8 % 14.4 % Tuesday 8.2 5.7 13.8 Wednesday 8.1 5.5 13.5 Thursday 8.9 5.7 14.6 Friday 8.1 4.5 12.6 Saturday 9.5 4.0 13.5 Sunday 11.4 6.1 17.4 Total 62.8 % 37.2 % 100.0 % Based on a sample of 158,529 directly-dialed, interLATA calls. 2003 Day 7:00 AM - 6:59 PM 7:00 PM - 6:59 AM Total Monday 8.3 % 5.7 % 14.1 % Tuesday 8.0 5.6 13.6 Wednesday 8.6 5.8 14.4 Thursday 8.1 5.6 13.7 Friday 7.8 4.2 12.0 Saturday 9.7 4.0 13.7 Sunday 11.9 6.6 18.5 Total 62.4 % 37.6 % 100.0 % Based on a sample of 167,836 directly-dialed, interLATA calls. Note: Individual figures may not add to totals due to rounding. Source: Calculated by Industry Analysis and Technology Division staff using survey data from TNS Telecoms ReQuest Market Monitor™, Bill Harvestingฎ. Table 14.6 Distribution of Residential Wireline Long Distance Minutes By Day and Time 14 - 6 15 - 1 15 Revenues In 1993, the Commission required all carriers with interstate revenues to begin filing an annual Telecommunications Relay Service (TRS) Fund Worksheet. Because revenues derived from providing access to the interstate network are considered to be interstate, virtually all carriers were required to file information. Starting in 1997, larger carriers were required to file Universal Service Fund (USF) worksheets, which contain similar information but with breakouts for revenues from service provided for resale and for service provided to end users. End-user revenues include revenues associated with services to end users and do not include resale (carrier’s carrier) revenues. Carrier's carrier revenues are sales of telecommunications to universal service contributors for resale in the form of telecommunications. Filers report all other revenues as end-user revenues. 1 On April 1, 2000, carriers first filed an FCC Form 499-A Telecommunications Reporting Worksheet to report prior year revenue data for TRS, USF, North American Numbering Planning Administration, and local number portability contribution purposes. The FCC Form 499-A superseded the older reporting requirements and is now filed to satisfy carrier registration requirements at the Commission as well. Table 15.1 shows the major components of telecommunications revenues from 1997 to the present: carrier’s carrier revenues and end-user revenues for local, wireless, and toll service. Chart 15.1 shows the trend of the end-user revenue percentages for local, wireless and toll services. Table 15.2 shows how revenues by type of service have changed over time. Table 15.3 shows the number of telecommunications service providers by principal type of business. The publication Telecommunications Provider Locator (March 2006 edition) lists carriers that filed a FCC Form 499-A worksheet in 2005. It also contains an address and contact telephone number for each carrier. Table 15.4 contains revenues for eleven years through 2004 by type of carrier. Additional revenue detail can be found in the latest Telecommunications Industry Revenues report (March 2006 edition). State-level telephone revenues are estimated using data from various editions of Telecommunications Industry Revenues, Statistics of Communications Common Carriers, Local Telephone Competition, and access filings to the FCC. 2 The carriers also file 1 Carrier's carrier revenues and end-user revenues are defined in the FCC Form 499 instructions. Carrier's carrier revenues includes, for example, most access services that local exchange carriers provide to toll carriers. Sales to de minimis carriers and to others that are exempt from universal service contribution requirements, however, must be classified as end-user revenues. Filers contribute to the universal service funding mechanism based on types of end-user revenues. 2 See Industry Analysis and Technology Division, Wireline Competition Bureau, Monitoring Report (various issues), Industry Analysis Division, Common Carrier Bureau, State-by-State Telephone Revenues and Universal Service Data (various issues). Estimates for 2004 use a similar methodology as those used in 2003. 15 - 2 quarterly data reported on form 499Q. Table 15.5 provides estimates of telecommunications revenues by state for 1995 to 2004. Table 15.6 provides estimates of end-user and carrier’s carrier revenues by state for 2004. Tables 15.7 and 15.8 provide estimates of telecommunications revenues for incumbent local exchange carriers, competitive local exchange carriers, and mobile wireless carriers by state; as well as estimates for subscriber line charges, access, and toll services. Table 15.1 Telecommunications Industry Revenues 1 (Dollar Amounts Shown in Millions) Preliminary 5/ 1997 1998 1999 2000 2001 2002 2003 2004 2005 Carrier's Carrier Revenues 2 Local Service 3 $28,289 $29,374 $33,156 $36,621 $40,108 $38,412 $37,742 $38,546 $38,734 Wireless Service 2,752 3,060 4,652 5,144 6,180 5,020 4,465 4,164 6,604 Toll Service 11,598 13,448 14,934 21,849 19,999 16,476 18,205 15,703 15,961 Intrastate 16,201 18,892 22,293 25,553 27,848 25,770 24,825 25,852 26,971 Interstate and International 4 26,562 27,114 30,449 38,060 38,439 34,138 35,587 32,561 34,327 Total 42,639 45,882 52,742 63,613 66,287 59,907 60,412 58,413 61,298 End User Revenues 2 Local Service 3 69,137 75,189 78,608 84,526 87,704 88,712 86,474 83,407 82,771 Wireless Service 30,199 33,714 43,843 56,857 68,507 76,501 85,254 94,404 100,869 Toll Service 89,193 91,607 93,311 87,767 79,302 67,222 58,983 55,511 47,801 Intrastate 117,454 123,216 134,919 147,465 155,347 154,815 150,889 153,265 154,306 Interstate and International 4 70,952 77,170 80,844 81,685 80,165 77,619 79,822 80,057 77,135 Total 188,406 200,386 215,763 229,149 235,513 232,434 230,711 233,322 231,441 Total Revenues Local Service 3 97,426 104,563 111,764 121,147 127,812 127,123 124,216 121,953 121,504 Wireless Service 32,951 36,775 48,495 62,000 74,687 81,521 89,718 98,568 107,473 Toll Service 100,791 105,055 108,246 109,615 99,301 83,697 77,188 71,214 63,762 Intrastate 133,655 142,108 157,212 173,018 183,195 180,585 175,714 179,117 181,277 Interstate and International 4 97,514 104,284 111,293 119,745 118,605 111,756 115,409 112,617 111,462 Total $231,168 $246,392 $268,505 $292,762 $301,800 $292,341 $291,123 $291,734 $292,739 Note: Detail may not add to totals due to rounding. 1 Data include revenues for de minimis filers as well as for other carriers that are exempt from universal service contribution requirements. 2 Carrier's carrier revenues are reported on the FCC Form 499-A as sales to other universal service contributors for resale. This includes, for example, access services that local exchange carriers provide to toll carriers. Sales to de minimis resellers, end-user customers, governments, non-profits, and any other non-contributors are treated as end-user revenues. Filers contribute to the universal service funding mechanisms based on their end-user revenues. 4 Revenues from calls that both originate and terminate in foreign points are reported as end-user revenues, and are included in this table, but are not included in the 5 Preliminary 2005 data are based on FCC Form 499-Q quarterly filings. Companies that do not contribute to universal service are not required to make these filings. The quarterly filings include preliminary data for the just closed quarter and projections for the coming quarter, and therefore are not as accurate as the subsequent annual filings. Also, FCC Form 499-Q filers do not separate revenue by type of service. Therefore, revenue totals by service type for 2005 are based on type of filer rather than on data filed by service. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006), except as noted. End-User Telecommunications Revenues universal service contribution base. 3 Payphone revenues are included with local service revenues in this table. Chart 15.1 1997 Toll Service 47.3% Wireless Service 16.0% Local Service 36.7% 2005 Toll Service 20.7% Local Service 35.8% Wireless Service 43.6% 15 - 3 Table 15.2 Telecommunications Revenues Reported by Type of Service (Dollar Amounts Shown in Millions) TRS Data Universal Service & FCC Form 499-A TRS Data Data Telecommunications Revenues 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Local Exchange $42,245 $45,194 $48,717 $53,771 $59,245 $64,940 $69,947 $72,346 $71,320 $70,606 $68,238 Pay Telephone 1/ 2,182 2,536 2,218 1,932 1,585 1,192 1,063 1,002 Local Private Line 2/ 1,138 1,226 1,616 8,282 10,403 12,914 16,864 21,966 23,070 22,415 23,840 Other Local 3/ 1,407 3,233 2,674 2,847 2,179 2,501 3,249 3,391 3,418 3,242 2,944 Subscriber Line Charges 2/ 7,310 7,597 7,829 8,327 11,052 10,826 11,563 12,127 12,758 12,136 11,715 Access 2/ 25,449 26,314 27,812 21,423 18,449 18,105 17,017 15,096 13,955 12,972 12,352 Universal Service Surcharges on Local Service Bills 4/ 103 260 575 1,301 1,410 1,783 1,862 Additional Revenues from TRS Worksheets 595 595 Total Local Service Revenues 77,548 83,564 88,647 97,426 104,563 111,764 121,147 127,812 127,123 124,216 121,953 Wireless Service 12,863 16,883 23,444 32,760 36,240 48,117 61,505 74,006 80,678 88,023 96,450 Universal Service Surcharges on Local Service Bills 4/ 345 379 495 681 842 1,696 2,118 Additional Revenues from TRS Worksheets 189 189 Total Wireless Service Revenues 12,863 16,883 23,444 32,950 36,775 48,495 62,000 74,687 81,521 89,718 98,568 Operator 1/ 10,539 11,170 10,975 12,002 12,205 10,049 11,406 10,389 7,902 6,567 6,542 Non-Operator Switched Toll 61,468 65,217 73,751 72,059 74,168 78,389 75,183 65,325 54,475 50,178 46,387 Long Distance Private Line 9,043 9,719 10,665 10,504 11,952 13,169 16,189 16,402 15,108 15,316 13,906 Other Long Distance 3,428 3,523 4,299 4,695 3,386 3,656 3,372 3,259 2,445 2,222 1,801 Universal Service Surcharges on Local Service Bills 4/ 1,810 2,983 3,467 3,927 3,767 2,905 2,577 Additional Revenues from TRS Worksheets 1,532 1,532 Total Toll Service Revenues 84,478 89,629 99,691 100,793 105,055 108,246 109,615 99,301 83,697 77,188 71,214 Total Telecommunications Revenues 3/ 174,890 190,076 211,782 231,168 246,392 268,505 292,762 301,799 292,341 291,122 291,735 Non-Telecommunications Revenues 3/ 8,324 9,071 10,474 25,633 27,944 33,144 42,261 48,036 60,406 65,186 71,493 Total Reported Revenues 183,214 199,147 222,256 256,801 272,019 301,648 335,023 349,835 352,747 356,308 363,227 Service Reported as: Intrastate 3/ 102,603 112,923 127,849 133,654 142,108 157,212 173,018 183,195 180,585 175,714 179,129 Interstate and International 80,611 86,224 94,407 97,514 104,284 111,293 119,745 118,605 111,756 115,409 112,605 Total Telecommunications Revenues 3/ $183,214 $199,147 $222,256 $231,168 $246,392 $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 Note: Detail may not add to totals due to rounding. 1/ TRS filers generally reported pay telephone revenues as local service revenues, access revenues or operator toll revenues. The Universal Service and FCC Form 499-A Worksheets contain a separate category for payphone coin revenues. Starting in 1997, payphone revenues include payphone compensation received from toll carriers. 2/ TRS Worksheet filers generally reported special access revenues as access revenues. Reporting changes implemented with the Universal Service Worksheet explain the increase in local private line revenues and the fall in access revenues shown for 1997. TRS Worksheet filers included subscriber line charges with other access charges. For the years 1994 - 1996, these revenues have been disaggregated by assuming that the end-user access revenues in Table 4.2 of Statistics of Communications Common Carriers represents 93% of industry total subscriber line charge revenues. Universal Service Worksheet filers report subscriber line charges in a separate category. The increase from 1997 to 1998 represents PICC charges levied by ILECs as well as $1.2 billion of PICC pass-through charges levied by toll carriers. 3/ Significant amounts of enhanced services, billing and collection, CPE and other non-telecommunications revenues were reported in the TRS mobile and other local service categories through 1996. Universal Service Worksheet filers report these revenues in the non-telecommunications category. For prior years, the amounts of non-telecommunications revenues reported as mobile and other local revenues were estimated as 70% of the amounts that Tier 1 ILECs reported in ARMIS as miscellaneous and nonregulated revenues (then reported as account 5200 and account 5280, respectively) and 10% of amounts reported as mobile service revenues. These amounts have been removed from Other Local and moved to the Non-Telecommunications category. 4/ Charges on end-user bills identified as recovering state or federal universal service contributions are reported separately from local, wireless and toll revenues. Reported amounts are apportioned between local, wireless and toll service based on the proportions of local, wireless and toll intrastate and interstate revenues by type of carrier. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006). 15 - 4 Table 15.3 Number of Interstate Telecommunications Providers By Principal Type of Business Service Provider Category 1/ 2/ 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Incumbent Local Exchange Carriers (ILECs) 3/ 1,347 1,347 1,376 1,410 1,348 1,318 1,335 1,335 1,310 1,303 1,304 Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs) 30 57 94 129 212 298 479 511 451 601 690 Local Reselers 8115473105132100 100 136 Other Local Exchange Carriers 17 7 10 23 23 26 64 72 92 Total: Competitors of ILECs 30 57 119 147 276 394 607 669 615 773 918 Total: Fixed Local Service Providers 4/ 1,377 1,404 1,495 1,557 1,624 1,712 1,942 2,004 1,925 2,076 2,222 Payphone Providers 197 271 533 509 615 704 699 751 606 605 642 Wireless Telephony Including Cellular, Personal Communications Service (PCS) and SMR Telephony Carriers 790 792 853 732 808 784 783 670 422 413 396 Paging & Messaging Service 117 138 200 137 303 391 425 425 346 347 360 Specialized Mobile Radio (SMR) Dispatch 163 99 119 199 191 182 138 155 172 Wirels Dat Service Providers and 1 128453129212435 Other Mobile Service Providers Total: Wireless Service Providers 907 930 1,217 969 1,258 1,419 1,430 1,306 927 939 963 Interexchange Carriers (IXCs) 97 130 149 151 171 178 212 233 229 232 257 Operator Service Providers (OSPs) 292527322415201918 17 19 Prepaid Calling Card Providers 8 16 18 20 18 23 27 27 50 67 Satellite Service Carriers 22 13 13 17 25 34 33 40 40 Toll Resellers 206 260 345 340 388 406 493 558 574 642 751 Other Tol Cariers 343028153117356951 45 70 Total: Toll Service Providers 366 453 587 569 647 651 808 940 932 1,026 1,204 All Filers 2,847 3,058 3,832 3,604 4,144 4,486 4,879 5,001 4,390 4,646 5,031 1/ Filers are asked to select for themselves a service provider category that best describes their operations. The choices have changed over the years; for example, most satellite service providers identified themselves as other toll carriers in their 1997 TRS worksheets because that worksheet did not contain a separate category for satellite satellite service providers. Starting with the filings that included 2003 revenues, filers were able to identify up to five service provider types. Counts starting 2003 are based on the category selected as best describing the provider's operations. 2/ Counts are based on the numbers of filers actually reporting revenues. Counts dropped in 2002 because many affiliated filers were permitted to make consolidated filings. 3/ Fewer incumbent local exchange carriers filed in 1998 than in 1997 because of consolidation of study areas. 4/ The total number of local service providers shown in Table 8.7 differs from the total fixed local service providers shown in Table 15.3 because the number shown in Table 8.7 includes filers that self identify as mobile or toll providers, but that report some local exchange service revenues. The number of telecommunications providers shown in Table 15.3 also differs from the numbers shown in Table 5.3 because Table 5.3 includes all filers, including new filers that reported no revenues for the year shown. Source: Data filed on FCC Forms 431, 457, and 499-A worksheets. See also: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006) and Telecommunications Provider Locator (March 2006), available at http://www.fcc.gov/wcb/stats. 15 - 5 Table 15.4 Gross Revenues Reported by Type of Carrier (Dollars Shown in Millions) TRS Worksheet Data Universal FCC Form 499 Data Service & TRS Data Service Provider Category 1/ 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Incumbent Local Exchange Carriers 2/ $91,527 $95,612 $100,021 $105,154 $108,234 $112,216 $116,158 $117,885 $114,990 $109,480 $105,496 Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs) 281 623 1,011 1,919 3,348 5,652 9,814 12,998 13,043 15,509 15,112 Local Resellers 206 410 511 879 1,393 1,538 721 1,215 Other Local Exchange Carriers 157 36 171 11 329 406 338 245 Private Carriers 112 147 87 39 15 281 267 532 Shared-Tenant Service Providers 87 93 87 202 46 42 22 22 Total: Competitors of ILECs 281 623 1,011 2,481 4,034 6,508 10,945 14,781 15,309 16,857 17,126 Total: Fixed Local Service Providers 91,807 96,235 101,032 107,634 112,268 118,725 127,103 132,666 130,300 126,337 122,622 Total: Payphone Providers 300 349 357 933 1,101 1,213 972 836 641 523 445 Wireless Telephony Including Cellular, 11,933 15,488 21,400 29,944 33,139 46,513 59,823 71,887 78,568 88,168 98,329 Personal Communications Service (PCS) and SMR Telephony Carriers 2/ Paging & Messaging Service 2/ 2,861 3,161 3,232 3,102 2,197 1,473 1,007 872 Specialized Mobile Radio (SMR) 186 191 214 206 33 46 Dispatch Wireless Data Service Providers and 845 1,277 1,909 225 731 221 164 110 220 135 218 Other Mobile Service Providers Total: Wireless Service Providers 12,777 16,765 23,310 33,030 37,032 50,152 63,280 74,596 80,467 89,342 99,465 Interexchange Carriers (IXCs) 66,381 70,938 79,057 79,080 83,443 87,570 87,311 81,272 68,146 61,246 51,589 Operator Service Providers (OSPs) 536 500 461 603 590 337 635 611 554 567 523 Prepaid Calling Card Providers 16 238 519 888 866 727 133 460 812 1,635 Satellite Service Carriers 1,011 475 280 336 373 406 663 721 Toll Resellers 2,840 4,220 6,564 8,010 9,885 9,211 10,641 8,797 9,279 9,294 12,192 Other Toll Carriers 709 773 577 348 710 150 1,758 2,516 2,089 2,339 2,543 Total: Toll Service Providers 70,466 76,447 86,896 89,570 95,992 98,414 101,407 93,702 80,934 74,920 69,204 Adjustments 3/ (461) 280 18700000000 Total Telecommunications Revenues $174,890 $190,076 $211,782 $231,168 $246,392 $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 1/ Filers are asked to select for themselves a service provider category that best describes their operations. The choices have changed over the years. For example, most satellite service providers identified themselves as other toll carriers in their 1997 Form 431 TRS worksheets because that worksheet did not contain a separate category for satellite service providers. For 2003 and 2004, some filers identified themselves as all distance carriers. These filers have been reclassified to be consistent with prior classifications. 2/ Significant amounts of enhanced service, billing and collection, CPE and other non-telecommunications revenues were reported on TRS worksheets by incumbent local exchange carriers (ILECs) and wireless carriers through 1996. Universal Service Worksheet filers report these revenues in the non-telecommunications category. For prior years, the amounts of non-telecommunications revenues reported as mobile and other local revenues were estimated as 70% of the amounts that Tier 1 ILECs reported in ARMIS as miscellaneous and nonregulated revenues (then reported as account 5200 and account 5280, respectively) and 10% of amounts reported as mobile service revenues. These amounts have been removed from incumbent local exchange carrier totals. 3/ Adjustments include some amounts withheld to preserve confidentiality and revisions made after the initial publication of the data. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006). 15 - 6 Alabama $2,668 $2,946 $3,205 $3,394 $3,712 $4,008 $4,314 $4,052 $4,196 $4,318 Alaska 464 518 561 590 664 717 770 778 816 823 American Samoa NA NA NA NA NA NA 13 13 13 15 Arizona 2,842 3,249 3,667 3,958 4,359 4,972 5,205 5,045 4,898 4,974 Arkansas 1,534 1,719 1,885 2,005 2,303 2,315 2,593 2,486 2,470 2,592 California 22,379 25,100 27,236 28,692 29,384 33,577 35,398 34,838 34,098 34,303 Colorado 3,128 3,526 4,006 4,260 4,826 5,290 5,515 5,308 5,013 4,984 Connecticut 2,765 2,943 3,266 3,173 3,405 3,924 4,020 3,854 3,884 3,821 Delaware 492 567 627 685 788 875 883 877 874 946 District of Columbia 886 955 1,049 1,085 1,581 1,648 1,383 1,343 1,337 1,296 Florida 11,582 12,972 14,161 15,042 17,223 18,308 18,849 18,223 18,613 20,003 Georgia 5,335 6,004 6,849 7,469 8,479 8,919 9,627 9,371 9,433 9,415 Guam NA 85 97 103 99 108 122 119 123 130 Hawaii 775 841 930 969 1,009 1,177 1,207 1,200 1,212 1,196 Idaho 791 908 967 1,010 1,092 1,210 1,245 1,244 1,237 1,223 Illinois 7,916 8,920 10,069 10,948 11,983 13,516 12,860 12,110 11,928 11,809 Indiana 3,804 4,192 4,536 4,810 5,099 5,552 5,524 5,385 5,292 5,298 Iowa 1,888 2,039 2,163 2,268 2,441 2,340 2,652 2,549 2,711 2,559 Kansas 1,829 2,017 2,165 2,304 2,588 2,571 2,656 2,479 2,473 2,436 Kentucky 2,353 2,629 2,861 3,060 3,426 3,573 3,665 3,301 3,307 3,634 Louisiana 2,703 2,946 3,192 3,432 3,913 3,964 4,274 4,185 4,232 4,278 Maine 869 976 996 1,105 1,195 1,328 1,387 1,365 1,359 1,353 Maryland 3,767 4,234 4,625 4,911 5,176 5,783 6,202 6,033 6,073 6,163 Massachusetts 4,988 5,455 6,010 6,338 6,561 7,428 7,367 7,121 6,983 6,897 Michigan 6,444 7,246 7,983 8,523 9,530 9,937 9,889 9,450 9,352 8,897 Minnesota 3,064 3,461 3,864 4,115 4,617 4,877 4,934 4,772 4,682 4,578 Mississippi 1,584 1,734 1,877 2,017 2,283 2,486 2,633 2,578 2,676 2,768 Missouri 3,623 4,017 4,389 4,613 5,442 5,688 6,067 5,436 5,676 5,522 Montana 640 709 756 780 897 937 903 907 911 897 Nebraska 1,296 1,428 1,540 1,587 1,737 1,760 1,865 1,796 1,799 1,744 Nevada 1,099 1,324 1,489 1,592 1,884 1,954 2,160 2,163 2,267 2,348 New Hampshire 989 1,118 1,208 1,246 1,313 1,429 1,419 1,399 1,373 1,362 New Jersey 7,091 7,927 8,707 9,366 9,558 10,670 10,689 10,251 10,054 10,258 New Mexico 1,121 1,262 1,370 1,433 1,518 1,515 1,656 1,631 1,706 1,767 New York 14,983 16,026 17,120 17,935 19,700 20,903 21,771 21,148 20,660 19,593 North Carolina 5,394 6,104 6,613 7,297 8,006 8,619 8,811 8,368 8,321 8,482 North Dakota 481 587 596 599 660 731 699 678 641 630 Northern Mariana Islands 15 18 21 30 34 32 43 46 44 44 Ohio 7,457 8,219 8,823 9,396 9,952 10,902 10,708 10,351 10,419 10,489 Oklahoma 1,996 2,179 2,410 2,552 2,727 2,915 3,116 3,100 3,210 3,169 Oregon 2,238 2,502 2,720 2,905 3,123 3,159 3,480 3,381 3,337 3,356 Pennsylvania 7,961 8,867 9,588 10,309 10,770 12,200 12,578 12,274 12,087 12,063 Puerto Rico 1,244 1,405 1,606 1,467 2,051 1,971 2,598 2,168 2,456 2,354 Rhode Island 686 761 839 859 946 1,012 989 978 965 980 South Carolina 2,653 2,849 3,053 3,393 3,790 4,047 4,147 4,142 4,187 4,124 South Dakota 488 584 602 635 716 763 712 690 668 667 Tennessee 3,467 3,880 4,302 4,553 4,928 5,256 5,574 5,409 5,466 5,442 Texas 12,871 14,563 15,943 17,576 19,032 21,405 21,617 21,549 21,508 21,610 Utah 1,112 1,284 1,443 1,557 1,790 1,998 2,090 2,016 1,986 2,003 Vermont 424 547 575 602 684 717 659 640 629 590 Virgin Islands 74 93 101 109 122 129 145 157 172 190 Virginia 5,061 5,646 6,179 6,576 7,020 8,013 8,506 8,174 8,107 8,074 Washington 3,995 4,438 4,613 5,080 5,703 6,253 6,260 6,215 6,090 6,172 West Virginia 1,143 1,240 1,337 1,383 1,437 1,625 1,735 1,671 1,674 1,707 Wisconsin 3,258 3,621 3,927 4,234 4,719 5,195 5,027 4,976 4,859 4,821 Wyoming 366 402 449 462 513 563 587 552 567 567 Total $190,076 $211,782 $231,168 $246,392 $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 NA - Not Available. Note: Figures may not add to totals due to rounding. Table 15.5 Total Telecommunications Revenues by State (Dollar Amounts Shown in Millions) 2003 2004 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Monitoring Report (various issues) and Industry Analysis Division, Common Carrier Bureau, State-by-State Telephone Revenue and Universal Service Data (various issues). 19991995 1996 1997 1998 2000 2001 2002 15 - 7 Table 15.6 Telecommunications Revenues by State: 2004 (Dollar Amounts Shown in Millions) End User Carrier's Carrier Total: End User + Carrier's Carrier Percent Interstate Intrastate Total Interstate Intrastate Total Interstate Intrastate Total of Total Alabama $1,155 $2,327 $3,481 $466 $371 $837 $1,621 $2,697 $4,318 1.48 % Alaska 267 383 650 109 65 173 376 447 823 0.28 American Samoa 2 10 12 1 2 3 3 12 15 0.01 Arizona 1,526 2,487 4,014 586 374 960 2,112 2,861 4,974 1.70 Arkansas 710 1,353 2,063 299 230 529 1,010 1,582 2,592 0.89 California 8,685 18,708 27,393 3,448 3,462 6,910 12,133 22,170 34,303 11.76 Colorado 1,473 2,484 3,957 626 401 1,027 2,099 2,885 4,984 1.71 Connecticut 1,222 1,869 3,090 503 227 730 1,724 2,096 3,821 1.31 Delaware 301 468 770 121 56 177 422 524 946 0.32 Dist. of Columbia 379 625 1,004 207 85 292 585 710 1,296 0.44 Florida 5,751 10,221 15,973 2,257 1,772 4,030 8,009 11,994 20,003 6.86 Georgia 2,578 4,937 7,515 1,179 722 1,901 3,757 5,659 9,415 3.23 Guam 41 62 103 17 10 27 58 72 130 0.04 Hawaii 340 631 970 129 96 225 469 726 1,196 0.41 Idaho 392 564 957 171 96 266 563 660 1,223 0.42 Illinois 3,241 6,414 9,654 1,199 955 2,154 4,440 7,369 11,809 4.05 Indiana 1,487 2,761 4,248 556 494 1,050 2,043 3,254 5,298 1.82 Iowa 733 1,268 2,001 300 257 558 1,033 1,525 2,559 0.88 Kansas 711 1,238 1,949 304 183 487 1,015 1,421 2,436 0.84 Kentucky 977 1,930 2,907 397 330 727 1,374 2,260 3,634 1.25 Louisiana 1,101 2,398 3,499 423 356 779 1,524 2,754 4,278 1.47 Maine 364 718 1,081 165 106 271 529 824 1,353 0.46 Maryland 1,785 3,178 4,963 712 488 1,200 2,497 3,666 6,163 2.11 Massachusetts 1,909 3,724 5,633 778 487 1,265 2,687 4,211 6,897 2.36 Michigan 2,276 4,926 7,203 834 861 1,695 3,110 5,787 8,897 3.05 Minnesota 1,294 2,368 3,662 542 374 916 1,836 2,742 4,578 1.57 Mississippi 709 1,542 2,251 292 225 517 1,001 1,767 2,768 0.95 Missouri 1,528 2,781 4,309 640 573 1,213 2,168 3,354 5,522 1.89 Montana 284 409 694 116 88 203 400 497 897 0.31 Nebraska 457 903 1,360 211 173 384 667 1,076 1,744 0.60 Nevada 835 1,056 1,891 322 136 457 1,157 1,192 2,348 0.80 New Hampshire 416 673 1,090 166 106 272 583 779 1,362 0.47 New Jersey 2,983 5,299 8,282 1,187 789 1,976 4,170 6,088 10,258 3.52 New Mexico 546 837 1,383 226 159 384 771 996 1,767 0.61 New York 4,927 10,674 15,601 2,157 1,835 3,992 7,084 12,509 19,593 6.72 North Carolina 2,429 4,364 6,794 966 722 1,688 3,395 5,087 8,482 2.91 North Dakota 178 308 485 85 59 145 263 367 630 0.22 N. Mariana Islands 13 23 35 5 4 9 18 26 44 0.02 Ohio 2,724 5,714 8,438 1,052 999 2,050 3,776 6,713 10,489 3.60 Oklahoma 898 1,650 2,549 378 242 620 1,276 1,893 3,169 1.09 Oregon 996 1,654 2,651 420 286 706 1,416 1,940 3,356 1.15 Pennsylvania 3,355 6,141 9,497 1,393 1,174 2,567 4,748 7,315 12,063 4.14 Puerto Rico 642 1,305 1,947 236 171 407 877 1,476 2,354 0.81 Rhode Island 274 536 809 99 72 171 372 608 980 0.34 South Carolina 1,161 2,162 3,324 453 347 801 1,615 2,509 4,124 1.41 South Dakota 192 325 517 82 68 150 274 393 667 0.23 Tennessee 1,521 2,918 4,439 598 405 1,004 2,119 3,323 5,442 1.87 Texas 5,267 11,824 17,091 2,243 2,277 4,519 7,509 14,101 21,610 7.41 Utah 595 1,007 1,602 247 154 401 842 1,161 2,003 0.69 Vermont 194 262 456 87 46 134 282 308 590 0.20 Virgin Islands 82 64 146 33 11 44 115 75 190 0.07 Virginia 2,344 4,021 6,365 992 717 1,709 3,336 4,738 8,074 2.77 Washington 1,764 3,089 4,853 740 578 1,318 2,504 3,668 6,172 2.12 West Virginia 517 828 1,344 217 146 363 734 973 1,707 0.59 Wisconsin 1,348 2,580 3,928 505 388 893 1,853 2,968 4,821 1.65 Wyoming 178 262 440 84 43 127 262 305 567 0.19 Total $80,056 $153,265 $233,321 $32,561 $25,852 $58,413 $112,617 $179,117 $291,734 100.00 % Note: Figures are preliminary and may not add to totals due to rounding. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Monitoring Report (December 2006). 15 - 8 Table 15.7 Telecommunications Revenues by Type of Service: 2004 (Dollar Amounts Shown in Millions) Alabama $1,292 $194 $1,354 $185 $332 $960 $4,318 Alaska NA NA NA NA NA NA 823 American Samoa NA NA NA NA NA NA 15 Arizona 1,032 433 1,812 222 425 1,050 4,974 Arkansas 642 87 810 95 254 704 2,592 California 7,019 2,010 12,694 1,138 3,349 8,094 34,303 Colorado 1,279 265 1,605 240 495 1,100 4,984 Connecticut 910 145 1,214 162 330 1,059 3,821 Delaware 200 48 349 42 80 226 946 District of Columbia 409 115 327 40 147 258 1,296 Florida 4,542 950 7,011 894 1,918 4,687 20,003 Georgia 2,608 520 3,138 362 907 1,880 9,415 Guam NA NA NA NA NA NA 130 Hawaii 289 22 482 64 114 226 1,196 Idaho 289 21 385 64 144 321 1,223 Illinois 2,582 890 4,430 413 882 2,611 11,809 Indiana 1,344 267 1,674 259 444 1,310 5,298 Iowa 567 106 851 108 287 640 2,559 Kansas 593 169 791 84 214 586 2,436 Kentucky 1,052 116 1,177 163 321 806 3,634 Louisiana 1,265 151 1,499 184 292 887 4,278 Maine 370 61 359 55 117 390 1,353 Maryland 1,416 328 2,104 244 520 1,551 6,163 Massachusetts 1,456 531 2,306 288 520 1,797 6,897 Michigan 1,925 839 3,195 330 733 1,875 8,897 Minnesota 1,043 322 1,661 182 443 927 4,578 Mississippi 930 70 830 105 176 657 2,768 Missouri 1,393 229 1,683 228 600 1,389 5,522 Montana 229 14 239 51 102 262 897 Nebraska 439 109 579 56 203 357 1,744 Nevada 510 80 777 87 181 715 2,348 New Hampshire 275 91 404 59 116 416 1,362 New Jersey 1,795 703 3,722 419 952 2,667 10,258 New Mexico 438 27 552 100 203 445 1,767 New York 5,168 1,961 5,848 726 1,689 4,201 19,593 North Carolina 2,161 307 2,869 392 767 1,986 8,482 North Dakota 151 30 196 26 83 144 630 N. Mariana Islands NA NA NA NA NA NA 44 Ohio 2,719 522 3,641 426 891 2,289 10,489 Oklahoma 820 129 1,015 126 277 802 3,169 Oregon 784 142 1,114 163 361 791 3,356 Pennsylvania 2,467 908 3,777 553 1,288 3,070 12,063 Puerto Rico 609 25 1,000 97 184 439 2,354 Rhode Island 191 114 362 35 57 222 980 South Carolina 1,124 120 1,375 181 338 985 4,124 South Dakota 145 26 225 27 83 160 667 Tennessee 1,520 253 1,866 244 391 1,169 5,442 Texas 5,871 1,235 7,114 748 2,150 4,492 21,610 Utah 415 153 723 85 196 429 2,003 Vermont 166 22 97 32 59 214 590 Virgin Islands NA NA NA NA NA NA 190 Virginia 1,685 530 2,584 340 843 2,092 8,074 Washington 1,348 263 2,099 300 705 1,457 6,172 West Virginia 500 45 420 84 155 503 1,707 Wisconsin 1,139 334 1,666 205 360 1,117 4,821 Wyoming 139 20 164 27 69 148 567 Total 3 $69,506 $17,125 $98,550 $11,802 $26,875 $67,871 $291,734 NA - Not Applicable. Note: Figures are preliminary and may not add to totals due to rounding. 1 Excludes subscriber line charges. 2 Includes ILECs' USF pass-thru charges. 3 Totals in the first six columns include revenues for locations not estimated. Access Toll Total Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Monitoring Report (December 2006). ILECs 1 CLECs Mobile Wireless SLCs 2 15 - 9 16-1 16 Subscribership Under contract with the FCC, the U.S. Census Bureau includes questions on telephones as part of its Current Population Survey (CPS). This survey, which monitors demographic trends between the decennial censuses, has several strengths: it is conducted regularly by an expert agency, the sample is very large, and the questions are consistent. Thus, changes in the results can be compared over time with a great deal of confidence. Almost twenty-nine million households have been added to the nation's telephone system since these surveys began in November 1983, reflecting both an increase in the total number of households and a small, but statistically significant, increase in the percentage of households that subscribe to telephone service. Because of smaller sample sizes, state-by-state data, shown in Table 16.3, are subject to greater sampling errors than the national data shown in Table 16.1. These two tables are based on the Census Bureau’s Current Population Survey. Additional information can be found in the Telephone Penetration and Telephone Subscribership reports available on the Internet on the Wireline Competition Bureau Statistical Reports web page at www.fcc.gov/wcb/stats. Historical estimates for the United States, using the decennial census population counts, are shown in Table 16.2. Prior to 1980, historical estimates of telephone penetration were based on a comparison of the number of residential main stations to the number of households. These estimates became less reliable at that point because of the emergence of an increasing number of households with multiple phone lines. In the 1980 decennial census, the question "Do you have a telephone?" was added to the long-form questionnaire. The 1980 and 1990 percentages in Table 16.2 are based on those responses. In the 2000 decennial census, the question was changed to “Is there telephone service available in this [housing unit] from which you can both make and receive calls?” The question was changed in 2000 to avoid the possible bias from having a phone but no service. With the telephone companies no longer owning the telephone instruments beginning in 1984, it is possible for someone to have a telephone but not have service. The question also allows for the possibility of the substitution of wireless service for wireline service. Beginning in 2001 the Census Bureau introduced the American Community Survey (ACS), which was designed to replace the long form of the decennial census, and Table 16.2 includes data from that survey as well. Table 16.2 also documents the per capita changes in wireline phone lines and wireless subscribers over time. The decennial census percentages in 1990 and 2000 and the ACS percentages for 2001 to 2005 reported in Table 16.2 are higher than the CPS percentage reported in Table 16.1. These differences are due to slight differences in the questions and the contexts in which they are asked. Also, the CPS uses households as the basis of measurement, while the census and the ACS use occupied housing units instead. Further information from the ACS is shown in Tables 16.4 and 16.5. Table 16.4 shows state data and Table 16.5 shows other characteristics including housing unit tenure, age of the householder, and race and ethnicity of the householder. Table 16.1 Household Telephone Subscribership in the United States Households Percentage Households Percentage Households with with without without (Millions) Telephones Telephones Telephones Telephones (Millions) (Millions) 1983 November 85.8 78.4 91.4 % 7.4 8.6 % 1984 March 86.0 78.9 91.8 7.1 8.2 July 86.6 79.3 91.6 7.3 8.4 November 87.4 79.9 91.4 7.5 8.6 1985 March 87.4 80.2 91.8 7.2 8.2 July 88.2 81.0 91.8 7.2 8.2 November 88.8 81.6 91.9 7.2 8.1 1986 March 89.0 82.1 92.2 6.9 7.8 July 89.5 82.5 92.2 7.0 7.8 November 89.9 83.1 92.4 6.8 7.6 1987 March 90.2 83.4 92.5 6.8 7.5 July 90.7 83.7 92.3 7.0 7.7 November 91.3 84.3 92.3 7.0 7.7 1988 March 91.8 85.3 92.9 6.5 7.1 July 92.4 85.7 92.8 6.7 7.2 November 92.6 85.7 92.5 6.9 7.5 1989 March 93.6 87.0 93.0 6.6 7.0 July 93.8 87.5 93.3 6.3 6.7 November 93.9 87.3 93.0 6.6 7.0 1990 March 94.2 87.9 93.3 6.3 6.7 July 94.8 88.4 93.3 6.4 6.7 November 94.7 88.4 93.3 6.3 6.7 1991 March 95.3 89.2 93.6 6.1 6.4 July 95.5 89.1 93.3 6.4 6.7 November 95.7 89.4 93.4 6.3 6.6 1992 March 96.6 90.7 93.9 5.9 6.1 July 96.6 90.6 93.8 6.0 6.2 November 97.0 91.0 93.8 6.0 6.2 1993 March 97.3 91.6 94.2 5.7 5.8 July 97.9 92.2 94.2 5.7 5.8 November 98.8 93.0 94.2 5.8 5.8 1994 March 98.1 92.1 93.9 6.0 6.1 July 98.6 92.4 93.7 6.2 6.3 November 99.8 93.7 93.8 6.2 6.2 1995 March 99.9 93.8 93.9 6.1 6.1 July 100.0 94.0 94.0 6.0 6.0 November 100.4 94.2 93.9 6.2 6.1 1996 March 100.6 94.4 93.8 6.2 6.2 July 101.2 95.0 93.9 6.1 6.1 November 101.3 95.1 93.9 6.2 6.1 1997 March 102.0 95.8 93.9 6.2 6.1 July 102.3 96.1 93.9 6.2 6.1 November 102.8 96.5 93.8 6.3 6.2 1998 March 103.4 97.4 94.1 6.1 5.9 July 103.4 97.3 94.1 6.1 5.9 November 104.1 98.0 94.2 6.1 5.8 1999 March 104.8 98.5 94.0 6.3 6.0 July 105.1 99.2 94.4 5.9 5.6 November 105.4 99.1 94.1 6.3 5.9 2000 March 105.3 99.6 94.6 5.7 5.4 July 105.8 99.8 94.4 5.9 5.6 November 106.5 100.2 94.1 6.3 5.9 2001 March 107.0 101.1 94.6 5.8 5.4 July 106.9 101.7 95.1 5.2 4.9 November 107.7 102.2 94.9 5.5 5.1 2002 March 108.3 103.4 95.5 4.8 4.5 July 108.5 103.2 95.1 5.3 4.9 November 109.0 104.0 95.3 5.1 4.7 2003 March 112.1 107.1 95.5 5.0 4.5 July 112.1 106.8 95.2 5.3 4.8 November 113.1 107.1 94.7 6.0 5.3 2004 March 112.9 106.4 94.2 6.5 5.8 July 113.5 106.5 93.8 7.1 6.2 November 113.8 106.4 93.5 7.4 6.5 2005 March 114.5 105.8 92.4 8.7 7.6 July 114.4 107.5 94.0 6.8 6.0 November 115.2 107.0 92.9 8.2 7.1 2006 March 115.5 107.2 92.8 8.4 7.2 July 116.2 109.9 94.6 6.3 5.4 Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telephone Subscribership in the United States (January 2007). Based on data from the Census Bureau's Current Population Survey. 16 - 3 Percentage of Telephone Wireless Housing Units Wire Lines per Subscribers per Year with Telephones 100 Population 100 Population 1920 % 1930 1940 1950 1960 1970 1980 1990 2000 2001 2002 2003 2004 2005 Sources: Percentage data for 1920 to 1970 from the U.S. Census Bureau, Historical Statistics of the United States, Colonial Times to 1970, Part 2, page 783. Percentage data for 1980 to 2000 from the decennial censuses. Percentage data for 2001 to 2005 from the Census Bureau's American Community Survey. Telephone line data for 1920 through 1970 are estimated by multiplying the number of telephones by the proportion of main plus equivalent main stations to total telephones for the Bell System. Prior to 1950, the 1950 proportion is used. For 1980 and 1990, ILEC local loops are used (see Table 7.1). For 2000 to 2005, June ILEC and CLEC lines are used from Industry Analysis and Technology Division, Wireline Competition Bureau Bureau, Local Telephone Competition: Status as of June 30, 2005 (April 2006). June wireless subscribers reported by CTIA are from Table 11.1. For 1920 to 2000 the population from the decennial census is used. For 2001 to 2005 Census Bureau population estimates for July 1 are used. 35.0 40.9 36.9 61.8 12.7 21.7 9.6 12.5 95.7 67.4 65.6 78.3 90.5 92.9 67.9 27.6 35.0 45.1 16 - 4 63.7 61.3 1.8 34.5 41.5 46.7 50.9 57.7 94.8 94.8 60.1 65.6 Table 16.2 Historical Telephone Penetration Estimates 54.7 97.6 96.9 96.6 96.2 State Alabama 88.4 % 91.6 % 3.2 % * Alaska 86.5 95.2 8.7 * Arizona 86.9 92.9 6.0 * Arkansas 86.6 87.9 1.3 California 92.5 95.4 3.0 * Colorado 93.2 95.1 1.8 * Connecticut 95.5 93.9 -1.6 # Delaware 94.3 91.5 -2.7 # District of Columbia 94.9 92.2 -2.7 # Florida 88.7 91.8 3.1 * Georgia 86.2 89.8 3.6 * Hawaii 93.5 94.8 1.3 Idaho 90.7 94.8 4.1 * Illinois 94.2 89.6 -4.6 # Indiana 91.6 90.8 -0.8 Iowa 96.2 95.4 -0.8 Kansas 94.3 94.3 0.0 Kentucky 88.1 91.3 3.1 * Louisiana 89.7 91.8 2.2 * Maine 93.4 95.7 2.3 * Maryland 95.7 94.0 -1.7 # Massachusetts 95.9 94.5 -1.4 # Michigan 92.8 92.6 -0.2 Minnesota 95.8 96.2 0.4 Mississippi 82.4 89.5 7.1 * Missouri 91.5 94.2 2.7 * Montana 91.0 93.0 2.0 * Nebraska 95.7 94.3 -1.4 # Nevada 90.4 91.2 0.8 New Hampshire 94.3 95.8 1.5 New Jersey 94.8 93.8 -1.0 New Mexico 82.0 91.2 9.2 * New York 91.8 92.1 0.3 North Carolina 88.3 92.8 4.5 * North Dakota 94.6 96.3 1.7 * Ohio 92.4 94.1 1.6 * Oklahoma 90.3 89.2 -1.1 Oregon 90.6 95.7 5.1 * Pennsylvania 94.9 95.6 0.7 Rhode Island 93.6 95.3 1.7 South Carolina 83.7 93.1 9.5 * South Dakota 93.2 95.9 2.7 * Tennessee 88.5 92.3 3.8 * Texas 88.4 91.1 2.7 * Utah 92.5 96.9 4.4 * Vermont 92.3 95.6 3.3 * Virginia 93.1 93.2 0.2 Washington 93.0 96.9 3.9 * West Virginia 87.7 92.6 4.9 * Wisconsin 95.2 94.8 -0.4 Wyoming 89.9 94.8 4.9 * Total United States 91.6 % 93.1 % 1.5 % * Note: Differences may not appear to equal changes due to rounding. * Increase is statistically significant at the 95% confidence level. # Decrease is statistically significant at the 95% confidence level. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telephone Subscribership in the United States (May 2006). Based on data from the Census Bureau's Current Population Survey. 16 - 5 20051984 Table 16.3 Telephone Penetration by State (Annual Average Percentage of Households with Telephone Service) Change State Alabama 95.2 % 95.3 % 95.1 % 94.5 % 93.3 % Alaska 96.6 97.9 96.7 97.6 96.6 Arizona 95.8 95.6 95.0 95.2 93.1 Arkansas 94.7 94.3 92.5 91.0 90.9 California 98.0 98.3 98.3 97.9 97.0 Colorado 98.5 97.4 97.0 96.5 95.1 Connecticut 98.8 98.7 98.2 98.3 97.3 Delaware 98.2 98.2 97.7 97.9 97.5 District of Columbia 97.1 97.5 96.9 96.1 95.2 Florida 97.0 96.6 96.3 95.5 94.0 Georgia 95.6 95.5 95.0 94.1 92.9 Hawaii 97.9 97.0 96.3 95.2 95.6 Idaho 96.2 97.4 96.3 95.7 96.2 Illinois 95.9 95.7 95.4 94.7 94.4 Indiana 95.4 94.7 93.7 93.4 94.4 Iowa 97.6 97.4 96.6 95.6 96.0 Kansas 96.9 96.3 95.8 95.7 93.6 Kentucky 96.0 94.8 95.0 93.3 92.0 Louisiana 95.3 95.4 94.7 92.9 92.9 Maine 98.8 98.2 98.4 97.7 96.6 Maryland 97.7 97.5 97.5 97.0 95.8 Massachusetts 98.5 98.6 98.5 97.9 96.2 Michigan 96.4 95.5 95.1 94.4 93.4 Minnesota 98.7 98.2 98.5 97.4 96.7 Mississippi 93.3 93.4 92.8 91.4 89.6 Missouri 96.6 96.7 96.3 96.1 95.4 Montana 97.1 96.9 96.5 95.1 95.0 Nebraska 97.2 96.4 95.6 94.8 95.5 Nevada 95.2 95.3 94.4 95.2 95.9 New Hampshire 98.7 98.5 98.1 98.2 96.9 New Jersey 98.0 97.7 97.6 96.9 95.8 New Mexico 92.9 90.7 93.0 94.4 92.5 New York 97.2 96.9 96.8 96.5 95.5 North Carolina 96.5 95.6 94.1 94.5 93.8 North Dakota 97.8 97.3 96.8 95.9 94.7 Ohio 97.7 96.7 97.1 96.2 95.4 Oklahoma 95.7 93.9 94.7 93.7 93.1 Oregon 98.0 97.1 96.9 96.0 95.3 Pennsylvania 97.8 98.0 97.5 97.2 96.5 Rhode Island 98.3 97.8 97.7 96.8 96.4 South Carolina 96.0 94.7 94.7 93.6 92.3 South Dakota 97.6 96.8 96.1 95.8 95.3 Tennessee 96.8 96.3 95.1 95.2 92.9 Texas 95.9 95.4 94.3 93.7 92.9 Utah 97.4 97.7 97.5 97.4 96.5 Vermont 98.1 98.1 97.7 97.6 97.9 Virginia 97.3 97.0 97.0 95.8 95.6 Washington 97.5 97.8 97.0 96.5 96.5 West Virginia 95.1 95.9 94.8 94.0 94.5 Wisconsin 97.9 97.5 96.3 95.5 96.4 Wyoming 95.1 94.9 94.5 94.4 94.9 Total United States 96.9 % 96.6 % 96.2 % 95.7 % 94.8 % Puerto Rico NA NA NA NA 73.8 % Source: Census Bureau, American Community Survey 16 - 6 20022001 Table 16.4 Telephone Penetration by State (Percentage of Housing Units with Telephone Service) 20052003 2004 Characteristic Housing Unit Tenure Owner Occupied 98.8 % 98.7 % 98.5 % 98.3 % 97.7 % Renter Occupied 93.4 92.6 91.6 90.4 89.0 Age of Householder 15 - 34 94.5 93.6 92.0 90.2 88.0 35 - 64 97.3 97.2 97.1 96.7 96.1 65 + 98.7 98.6 98.7 98.7 98.6 Race of Householder White 97.6 97.3 96.9 96.3 95.6 Black or African American 93.6 93.0 93.0 92.3 91.9 American Indian or Alaska Native 89.1 89.5 87.8 89.6 86.8 Asian 98.4 98.0 97.5 96.9 95.5 Native Hawaiian or Pacific Islander 95.9 95.5 91.4 92.2 93.1 Other 94.6 95.1 93.9 93.3 91.0 Two or More Races 95.1 92.7 95.6 92.8 92.7 Ethnicity of Householder Hispanic or Latino 94.2 93.9 93.4 92.6 91.6 Total United States 96.9 % 96.6 % 96.2 % 95.7 % 94.8 % Source: Census Bureau, American Community Survey. 16 - 7 20022001 Table 16.5 Telephone Penetration by Selected Characteristics (Percentage of Housing Units with Telephone Service) 20052003 2004 17-1 17 Technology and Infrastructure Price-cap regulated carriers, including the Bell operating companies (BOCs), file data on technology as part of their Automated Reporting Management Information System (ARMIS) reports. The data contained in Tables 17.1 and 17.3 are from the BOCs’ ARMIS 43-07 reports, and the data contained in Table 17.2 are from the ARMIS 43-05 report. The individual carrier's data can be obtained from the ARMIS web page at www.fcc.gov/wcb/eafs. Selected holding company statistics from the ARMIS 43-07 can be found in Section 10 of our Monitoring Report on the web page www.fcc.gov/wcb/iatd/monitor. Also information about broadband deployment is contained in Chapter 2, Advanced Telecommunications. 1. Central Office Technology Table 17.1 shows the number of BOC switches and tracks the deployment of certain key switching and signaling technologies, described below, in BOC central offices. (Information about broadband deployment is contained in Chapter 2, Advanced Telecommunications.) Telephone companies replaced most of their older electromechanical switches with stored program control switches (SPCSs) beginning in 1980. Stored program control makes it possible to change the operational and service features of a switch by changing the program stored in switch memory and executed by switch processors. SPCSs can use either analog or digital switching technology. As shown in Table 17.1 virtually all switches in BOC networks now use digital stored program control technology, and more than 98 percent of BOC access lines terminate on digital switches. As such, the tables in this report no longer separately track electromechanical or analog SPC switches. In the late 1980s, telephone companies began to convert switching offices from in-band signaling to Signaling System 7 (SS7). SS7 permits calls to be set up more efficiently, and also allows certain new services to be deployed. It may be implemented on both analog and digital stored program control switches. Data in Table 17.1 shows that SS7 has now been deployed almost everywhere in BOC networks. Telephone companies began introducing integrated services digital network (ISDN) capabilities on their digital switches shortly after introducing Signaling System 7. One of the attractions of ISDN is that ordinary local telephone lines (copper loops) can be used to transport data between computers at speeds higher than possible using a modem. In recent years, however, ISDN has taken a back seat to broadband technologies, such as Digital Subscriber Line (DSL) when used for this purpose. Table 17.2 provides some additional categorization of switches. It shows line counts of switches from 1996 to 2005 for the following categories: fewer than 1,000 lines; 1,000 - 4,999 lines; 5,000 - 9,999 lines; 10,000 - 19,999 lines; and 20,000 lines or more. The table also breaks out switches based on their being in a Metropolitan Statistical Area (MSA) or not (non-MSA). Note that while Table 17.1 provides switch 17-2 counts for BOCs only, Table 17.2 provides this information for all price-cap carriers. 2. Transmission Technology Each telephone company has a network of transmission paths interconnecting switching offices and also connecting customers to their serving local central offices. Today, wireline transmission is typically provided on fiber or copper cable, with other technologies being used only infrequently. As indicated in Table 17.3, from 1991 to 2005, the proportion of fiber cable sheath kilometers 1 in Bell Operating Company networks increased from 4% to over 13% of total cable sheath kilometers. The number of working channels provides a rough approximation of the number of transmission paths that are in service between customers and the telephone company offices serving those customers. This includes both switched access lines and the local portion of special access and private lines. Table 17.3 shows that the number of working channels provided partly or totally on fiber in BOC networks increased from about 4% of total working channels in 1991 to about 20% in 2005. 3. Equal Access Equal access refers to a class of service whereby all long distance service providers receive equivalent connections to the local exchange carrier's network. Where a local exchange carrier serves customers using equal-access switches, those customers can utilize their preferred long distance provider by dialing "1" plus the ten-digit telephone number they want to reach. The conversion of lines by local exchange carriers to equal access started in 1984; by the end of 1996, over 99% of the nation's lines were served by equal access switches. A table tracing this process through time can be found in the equal-access section of the Trends report released in July 1998. Despite the fact that more than 99% of the nation's customers receive equal access, there still are some central offices where equal access is not yet available. Table 17.4 shows the number of central office wire centers in each state that had been converted to equal access as of May 1, 2006. The table is derived from NECA’s Tariff 4 database, which is updated by local exchange carriers. In some cases, there is a lag between an office converting to equal access and that change being reflected in the database. Thus, in some cases, the data continue to show some offices not yet converted to equal access even in states where equal access is reported to be available to all customers. 1 Cable sheath kilometers is a measure of the length of cable used to provide telecommunications services. A sheath contains individual copper or fiber pairs used to transmit voice or data. Fiber cable sheaths typically contain 40 to 50 fiber strands while copper cable sheaths contain as many as several hundred copper pairs. 17-3 4. Rural Network Capabilities The National Exchange Carrier Association periodically conducts a survey of over 1,000 small, mostly rural telephone companies. 2 The most recent survey focuses on the small companies’ efforts to bring advanced services to their customers. Table 17.5 shows selected network capabilities by state of the 1,120 companies that responded to the 2006 survey. In addition to the number of switches and access lines, the table shows the percentage of companies equipped with DSL and with ATM, the number of ADSL and SDSL (and other broadband) access lines, and the percentage of central offices equipped for equal access. 5. Telecommunications Patents One measure of developing technology is the number of U.S. patents. The U.S. Patent and Trademark Office maintains a file of over six million distinct U.S. patents granted. These patents are categorized by technology. Chart 17.1 shows the number of patents granted for telecommunications from 1990 to 2004. The information presented profiles U.S. patent activity in the general field of telecommunications. It includes all U.S. patent documents, except reissued patents, granted between January 1990 and December 31, 2004 in the following classes: Class 370, Multiplex Communications Class 375, Pulse or Digital Communications Class 379, Telephonic Communications Class 455, Telecommunications 6. Capital Expenditures The FCC does not systematically collect information on capital expenditures from most carriers. Table 17.6 provides annual estimates of expenditures for structures and equipment for telecommunications carriers, taken from a U.S. Census Bureau survey. 3 Chart 17.2 combines this expenditure data with FCC collected revenue data. It shows that for each dollar of revenue collected from end users in 2004, wireless carriers invested 25 cents in structures and equipment whereas wireline, resellers, satellite & other carriers invested 17 cents. Overall, capital expenditures were 22 cents for each dollar of end-user revenues. 2 National Exchange Carrier Association (NECA), Trends 2006 - Making Progress in Broadband 3 U.S. Census Bureau, Annual Capital Expenditures: 2004, (Issued March 2006) Table 4a, http://www.census.gov/csd/ace/ Year End Total Signaling System 7 ISDN Digital Stored Switches Switches Switches Program Controlled Switches 1980 9,195 0 0.00 % 0 0.00 % 0 0.00 % 1981 9,198 0 0.00 0 0.00 24 0.26 1982 9,173 0 0.00 0 0.00 80 0.87 1983 9,156 0 0.00 0 0.00 171 1.87 1984 9,102 0 0.00 0 0.00 347 3.81 1985 9,124 0 0.00 0 0.00 860 9.43 1986 9,167 0 0.00 0 0.00 1,620 17.67 1987 9,190 29 0.32 4 0.04 2,538 27.62 1988 9,300 435 4.68 82 0.88 3,577 38.46 1989 9,338 931 9.97 179 1.92 4,403 47.15 1990 9,872 2,428 24.59 600 6.08 5,816 58.91 1991 9,951 3,670 36.88 920 9.25 6,636 66.69 1992 10,069 5,392 53.55 1,219 12.11 7,530 74.78 1993 10,089 6,688 66.29 1,874 18.57 8,239 81.66 1994 10,023 8,334 83.15 2,400 23.94 8,795 87.75 1995 10,051 8,977 89.31 2,868 28.53 9,015 89.69 1996 9,966 9,286 93.18 3,329 33.40 9,247 92.79 1997 9,965 9,688 97.22 3,902 39.16 9,417 94.50 1998 9,788 9,643 98.52 4,146 42.36 9,357 95.60 1999 1 9,968 9,844 98.76 4,424 44.38 9,648 96.79 2000 2 15,092 14,837 98.31 5,413 35.87 14,889 98.65 2001 15,109 14,969 99.07 5,465 36.17 14,970 99.08 2002 14,352 3 14,258 99.35 5,664 39.46 14,245 3 99.25 2003 14,373 14,314 99.59 5,672 39.46 14,289 99.42 2004 14,399 14,366 99.77 5,787 40.19 14,326 99.49 2005 12,321 12,292 99.76 5,694 46.21 12,256 99.47 Access Lines Served by Type of Office (Thousands) Year End All Signaling System 7 ISDN Digital Stored Switches Switches Switches Program Controlled Switches 1980 81,032 0 0.00 % 0 0.00 % 10 0.01 % 1981 82,581 0 0.00 0 0.00 57 0.07 1982 83,819 0 0.00 0 0.00 203 0.24 1983 86,186 0 0.00 0 0.00 615 0.71 1984 88,630 0 0.00 0 0.00 2,151 2.43 1985 91,455 0 0.00 0 0.00 8,145 8.91 1986 93,630 0 0.00 0 0.00 14,886 15.90 1987 96,593 1,035 1.07 12 0.01 22,946 23.76 1988 99,564 10,325 10.37 47 0.05 30,493 30.63 1989 102,684 21,917 21.34 111 0.11 38,192 37.19 1990 105,641 40,026 37.89 13,970 13.22 45,452 43.02 1991 107,388 57,321 53.38 20,567 19.15 52,061 48.48 1992 109,997 76,480 69.53 28,375 25.80 60,324 54.84 1993 113,368 92,493 81.59 39,875 35.17 71,192 62.80 1994 117,345 109,465 93.28 56,546 48.19 84,040 71.62 1995 122,266 116,568 95.34 71,274 58.29 93,172 76.20 1996 125,844 122,343 97.22 85,434 67.89 101,283 80.48 1997 131,722 130,778 0.00 95,956 72.85 110,503 83.89 1998 136,426 136,246 0.00 106,834 78.31 119,738 87.77 1999 1 141,763 141,685 0.00 113,999 80.42 129,838 91.59 2000 2 160,557 160,303 0.00 132,844 82.74 153,240 95.44 2001 155,543 155,363 0.00 129,075 82.98 150,732 96.91 2002 148,292 3 4 4 124,451 83.92 145,009 3 97.79 2003 142,698 4 4 119,403 83.68 140,271 98.30 2004 136,057 4 4 115,561 84.94 134,076 98.54 2005 127,026 4 4 107,159 84.36 125,460 98.77 Note: Because of different sources, the data for 1989 and earlier years may not be consistent with the data for 1990 and later years 1 Southern New England Telephone Company merged with SBC Communications October 26, 1998. Their data are included in this table starting with 1999. 2 Large increase in 2000 is due to the merger of Bell Atlantic and GTE. 3 The decrease in the number of switches and their associated lines from 2001 to 2002 is partially due to the sale of a number of study areas by Verizon. Sources: 1980-1989 reported in CC Docket 89-624. 1990-2005 reported in ARMIS 43-07. Table 17.1 Central Office Switches and Access Lines by Technology (Bell Operating Companies) 4 For 2002, the Commission eliminated the requirement that the Bell operating companies file electromechanical switch data. See 2000 Biennial Regulatory Review – Comprehensive Review of the Accounting Requirements and ARMIS Reporting Requirements for Incumbent Local Exchange Carriers: Phase 2, et al., CC Docket Nos. 00-199, 99-301, 97-212, 80-286, Report and Order in CC Docket Nos. 00-199, 97-212, and 80-286, Further Notice of Proposed Rulemaking in CC Docket Nos. 00-199, 99-301, and 80-286, 16 FCC Rcd 19911, 19770-72, paras. 161-165 (2001). 17-5 Table 17.2 Switches by Metropolitan Statistical Area (MSA) and Non-MSA Year Total Switches Total Switches Total Switches Switches with Switches with Switches with Switches with Switches with MSA Non-MSA MSA and Under 1,000 1,000 - 4,999 5,000 - 9,999 10,000 - 19,999 20,000 or More Non-MSA Lines Lines Lines Lines Lines 1996 8,711 7,426 16,137 4,594 5,758 1,770 1,431 2,584 1997 9,138 7,199 16,337 4,476 5,843 1,786 1,518 2,714 1998 9,011 7,492 16,503 4,374 6,027 1,821 1,527 2,754 1999 9,165 7,452 16,617 4,319 5,898 1,915 1,613 2,873 2000 9,058 6,340 15,398 3,472 5,538 1,869 1,632 2,888 2001 8,996 6,377 15,373 3,402 5,481 1,873 1,678 2,938 2002 9,181 6,336 15,517 3,618 5,610 1,857 1,645 2,787 2003 9,251 6,406 15,657 3,685 5,702 1,885 1,706 2,679 2004 9,284 6,214 15,498 3,754 5,697 1,871 1,679 2,497 2005 9,064 5,602 14,666 3,380 5,310 1,886 1,719 2,371 Notes: The number of switches in Table 17.2 differs from Tables 17.1. Table 17.1 is derived from the ARMIS 43-07, which is filed by the regional Bell operating companies. Table 17.2 is derived from the ARMIS 43-05, which is filed by incumbent local exchange carriers subject to price-cap regulation. The decline in switches between 2004 and 2005 is primarily due to Verizon GTE reporting substantially fewer switches in 2005 than in 2004. Verizon attributes its 2005 reduction in local switches to Verizon GTE's change in data sources from financial to operations databases, which the company expects will provide more timely information. And Switches by Line Counts 17 - 6 Table 17.3 Local Transmission Technology (Bell Operating Companies) Cable Sheath Kilometers Year End Total Copper Fiber Other 1991 4,163,640 3,955,622 95.0 % 196,791 4.7 % 11,228 0.3 % 1992 4,214,804 3,965,406 94.1 238,406 5.7 10,994 0.3 1993 4,264,569 3,976,100 93.2 280,017 6.6 8,450 0.2 1994 4,256,253 3,934,243 92.4 314,660 7.4 7,350 0.2 1995 4,319,068 3,960,343 91.7 351,907 8.1 6,819 0.2 1996 4,339,067 3,947,238 91.0 386,011 8.9 5,819 0.1 1997 4,396,205 3,974,204 90.4 416,105 9.5 5,896 0.1 1998 4,473,351 4,009,772 89.6 449,554 10.0 14,026 0.3 1999 1 4,608,808 4,103,657 89.0 491,478 10.7 13,672 0.3 2000 2 5,761,869 5,132,364 89.1 613,646 10.7 15,860 0.3 2001 5,848,516 5,166,537 88.3 665,805 11.4 16,174 0.3 2002 5,791,105 5,086,669 87.8 692,031 11.9 12,406 0.2 2003 5,851,790 5,118,314 87.5 720,877 12.3 12,600 0.2 2004 5,942,045 5,166,481 86.9 763,132 12.8 12,433 0.2 2005 5,990,163 5,166,382 86.2 811,896 13.6 11,884 0.2 Working Telecommunications Channels (Thousands) Year End Total Copper Fiber Radio 1991 118,654 114,047 96.1 4,605 3.9 2.3 0.0 1992 120,848 114,609 94.8 6,238 5.2 1.0 0.0 1993 124,191 115,496 93.0 8,694 7.0 1.4 0.0 1994 130,192 118,437 91.0 11,755 9.0 0.3 0.0 1995 136,231 122,975 90.3 13,255 9.7 0.3 0.0 1996 142,824 125,595 87.9 17,228 12.1 1.0 0.0 1997 149,429 128,436 86.0 20,992 14.0 0.3 0.0 1998 172,916 134,629 77.9 38,286 22.1 0.3 0.0 1999 1 186,387 138,691 74.4 47,696 25.6 0.0 0.0 2000 2 218,928 157,840 72.1 61,086 27.9 2.0 0.0 2001 228,705 152,441 66.7 76,263 33.3 2.0 0.0 2002 3 169,157 137,228 81.1 31,927 18.9 1.0 0.0 2003 158,890 127,652 80.3 31,237 19.7 1.0 0.0 2004 148,255 117,320 79.1 30,935 20.9 0.1 0.0 2005 137,254 110,033 80.2 27,221 19.8 0.1 0.0 Note: Working Channels are reported in 4 kHz bandwidth (single-voice channel) equivalents. 1 Southern New England Telephone Company merged with SBC Communications October 26, 1998. Their data are included in this table starting with 1999. 2 Large increase in 2000 is due to the merger of Bell Atlantic and GTE. 3 The large decrease from 2001 to 2002 is due in part to a number of Verizon companies refiling in order to remove interexchange carrier, point-of-presence, and co-location circuit counts to comply with ARMIS definitions. Source: ARMIS 43-07 report. 17 - 7 Table 17.4 Central Offices Converted to Equal Access 1/ (As of May 1, 2006) Bell Company Other ILEC CLEC All Central Offices Central Offices Central Offices Central Offices Equal Non-Equal % Equal Equal Non-Equal % Equal Equal Non-Equal % Equal Total % Equal Access Access Access Access Access Access Access Access Access Offices Access Alabama 147 0 100.0 % 221 0 100.0 % 35 0 100.0 % 403 100.0 % Alaska 0 0 NA 84 170 33.1 0 0 NA 254 33.1 American Samoa 0 0 NA 0 4 0.0 0 0 NA 4 0.0 Arizona 146 0 100.0 103 5 95.4 37 1 97.4 292 97.9 Arkansas 136 0 100.0 281 2 99.3 27 3 90.0 449 98.9 California 904 2 99.8 89 1 98.9 206 3 98.6 1,205 99.5 Colorado 165 1 99.4 95 5 95.0 37 0 100.0 303 98.0 Connecticut 126 0 100.0 2 0 100.0 21 0 100.0 149 100.0 Delaware 33 0 100.0 0 0 NA 4 0 100.0 37 100.0 District of Columbia 18 0 100.0 0 0 NA 22 0 100.0 40 100.0 Florida 291 0 100.0 177 0 100.0 228 0 100.0 696 100.0 Georgia 182 0 100.0 244 1 99.6 74 0 100.0 501 99.8 Guam 0 0 NA 3 0 100.0 0 0 NA 3 100.0 Hawaii 0 0 NA 92 0 100.0 8 0 100.0 100 100.0 Idaho 97 0 100.0 85 0 100.0 9 0 100.0 191 100.0 Illinois 697 4 99.4 325 7 97.9 60 2 96.8 1,095 98.8 Indiana 387 2 99.5 187 0 100.0 45 1 97.8 622 99.5 Iowa 135 0 100.0 676 0 100.0 52 0 100.0 863 100.0 Kansas 171 2 98.8 288 4 98.6 26 1 96.3 492 98.6 Kentucky 179 0 100.0 403 0 100.0 27 0 100.0 609 100.0 Louisiana 229 0 100.0 93 0 100.0 36 0 100.0 358 100.0 Maine 143 1 99.3 107 8 93.0 3 0 100.0 262 96.6 Maryland 214 0 100.0 1 0 100.0 32 0 100.0 247 100.0 Massachusetts 274 2 99.3 3 0 100.0 38 0 100.0 317 99.4 Michigan 541 7 98.7 169 0 100.0 55 0 100.0 772 99.1 Minnesota 156 0 100.0 565 4 99.3 115 0 100.0 840 99.5 Mississippi 205 0 100.0 70 0 100.0 22 0 100.0 297 100.0 Missouri 215 3 98.6 460 22 95.4 50 0 100.0 750 96.7 Montana 76 0 100.0 198 1 99.5 20 0 100.0 295 99.7 Nebraska 69 0 100.0 388 0 100.0 19 0 100.0 476 100.0 Nevada 55 0 100.0 61 3 95.3 14 0 100.0 133 97.7 New Hampshire 125 1 99.2 31 1 96.9 8 0 100.0 166 98.8 New Jersey 208 0 100.0 28 0 100.0 45 0 100.0 281 100.0 New Mexico 65 0 100.0 88 34 72.1 9 0 100.0 196 82.7 New York 526 1 99.8 301 7 97.7 103 0 100.0 938 99.1 North Carolina 183 0 100.0 545 1 99.8 103 0 100.0 832 99.9 North Dakota 27 0 100.0 264 19 93.3 15 0 100.0 325 94.2 Ohio 489 19 96.3 340 4 98.8 90 1 98.9 943 97.5 Oklahoma 208 2 99.0 288 19 93.8 25 1 96.2 543 95.9 Oregon 136 0 100.0 151 0 100.0 32 0 100.0 319 100.0 Pennsylvania 506 0 100.0 418 31 93.1 91 0 100.0 1,046 97.0 Puerto Rico 0 0 NA 86 0 100.0 2 0 100.0 88 100.0 Rhode Island 30 0 100.0 0 0 NA 6 0 100.0 36 100.0 South Carolina 158 0 100.0 257 0 100.0 50 0 100.0 465 100.0 South Dakota 42 0 100.0 202 7 96.7 9 0 100.0 260 97.3 Tennessee 196 0 100.0 483 0 100.0 48 1 98.0 728 99.9 Texas 796 2 99.7 691 10 98.6 214 5 97.7 1,718 99.0 Utah 64 0 100.0 94 4 95.9 13 0 100.0 175 97.7 Vermont 90 2 97.8 37 0 100.0 1 0 100.0 130 98.5 Virgin Islands 0 0 NA 5 0 100.0 0 0 NA 5 100.0 Virginia 326 0 100.0 254 7 97.3 62 0 100.0 649 98.9 Washington 219 0 100.0 141 2 98.6 44 0 100.0 406 99.5 West Virginia 145 0 100.0 86 6 93.5 2 0 100.0 239 97.5 Wisconsin 225 4 98.3 409 0 100.0 53 0 100.0 691 99.4 Wyoming 26 0 100.0 34 24 58.6 3 0 100 87 72.4 Total United States 10,781 55 99.5 % 10,703 413 96.3 % 2,350 19 99.2 % 24,321 98.0 % NA - Not applicable. 1/ Some companies do not report information on their remote switches in Tariff No. 4. As a result, central office counts may be lower than reported in other sources. Source: NECA FCC Tariff No. 4 database. 17 - 8 SDSL & other Jurisdiction Companies Alabama 21 82 114,870 95 % 8,655 3,797 29 % 99 % Alaska 24 238 236,712 88 30,621 7,080 17 50 Arizona 12 54 39,119 75 953 n/a 8 100 American Samoa 1 4 10,244 100 * * * 100 Arkansas 26 242 322,931 92 19,321 331 38 100 California 14 44 85,167 93 7,630 1 36 98 Colorado 25 44 48,099 88 3,489 744 16 98 Connecticut 1 14 24,462 100 * * * 100 Florida 6 13 77,254 100 9,494 n/a 25 100 Georgia 28 104 307,750 89 50,182 1,751 14 97 Guam 1 18 63,770 100 * * * 100 Hawaii 1 8 1,370 100 * * * 100 Idaho 15 58 42,967 93 1,571 93 20 100 Illinois 27 73 41,009 81 4,970 1,727 22 100 Indiana 34 81 120,499 88 15,042 1,326 29 100 Iowa 139 297 200,616 97 21,389 3,148 7 99 Kansas 31 167 103,222 100 20,084 3,596 26 99 Kentucky 13 270 137,746 100 8,310 3,217 38 100 Louisiana 18 101 136,281 89 11,232 n/a 62 99 Maine 19 105 138,667 100 11,888 199 26 100 Maryland 1 1 7,287 100 * * * 100 Massachusetts 2 3 3,856 100 427 n/a 0 100 Michigan 31 98 98,380 90 7,633 414 23 99 Minnesota 80 327 318,835 83 24,938 6,416 13 100 Mississippi 17 69 79,619 82 4,024 52 50 94 Missouri 35 291 228,001 97 12,797 505 54 98 Montana 14 195 95,575 100 8,176 n/a 43 100 Nebraska 31 120 57,083 100 6,631 2,355 13 100 Nevada 7 23 32,360 86 4,269 11 50 100 New Hampshire 9 31 55,127 100 8,357 n/a 56 100 New Mexico 12 78 42,862 100 3,513 157 42 99 New York 30 84 156,560 100 12,356 1,389 24 99 North Carolina 16 254 363,535 100 22,373 12,162 44 100 North Dakota 20 219 144,958 100 16,974 4,693 35 99 Ohio 34 74 196,333 85 22,842 1,883 18 100 Oklahoma 35 281 193,867 89 36,405 167 31 99 Oregon 27 53 76,314 85 12,052 132 7 100 Pennsylvania 21 611 541,510 100 14,528 133 19 100 South Carolina 13 183 110,272 100 9,972 2 38 100 South Dakota 27 178 127,989 85 5,905 1,443 22 100 Tennessee 20 435 326,380 100 24,552 n/a 55 100 Texas 46 346 274,770 98 27,683 1,357 30 98 Utah 10 51 69,184 100 6,015 158 20 100 Vermont 9 40 63,497 100 9,160 154 56 100 Virginia 15 164 78,872 93 7,338 472 27 98 Washington 18 31 79,713 100 10,994 42 28 100 West Virginia 6 13 16,316 100 1,430 310 0 100 Wisconsin 73 347 503,543 84 25,785 8,044 30 100 Wyoming 5 25 24,725 83 3,315 130 20 96 Totals 1,120 6,642 6,620,078 94 % 581,921 74,790 29 % 98 % ง Equal access gives customers a choice of long distance carrier. Although not a new service, NECA continues to track progress toward the goal of 100% equal access capability. * Individual data withheld to maintain company confidentiality. All data included in totals. Source: National Exchange Carrier Association "Trends 2006 - Making Progress in Broadband", a survey of more than 1,000 small, mostly rural telephone companies. Companies Table 17.5 Broadband Capabilities of NECA's 2006 Rural Incumbent LEC Survey Respondents with DSL ATM Service Equal Access ง Equipped for Central Switches ProvidingEquipped Access Access Lines BroadbandAccess Lines Lines OfficesCompaniesADSL 17 - 9 Note: 1996 total reflects one-time change in law affecting patents. Source: U.S. Patent and Trademark Office, Patent Counts by Class by Year, January 1977 - December 2005, Telecommunications Classes 370, 375, 379 and 455, (September 2006), available at http://www.uspto.gov/go/taf/cbcby.pdf. Chart 17.1 Telecommunications Patents 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 Patents 2,309 2,389 2,598 2,977 3,821 4,510 5,613 5,090 7,861 8,634 9,106 9,000 9,641 10,391 12,142 11,510 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 17 - 10 Table 17.6 Capital Expenditures for Structures and Equipment 1/ (Expenditure Amounts Shown in Millions) Industry 2/ 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Wireline Telecommunications Carriers Expenditures for Structures New $10,652 3/ $18,021 $14,482 $7,820 $9,825 3/ Used 12 3/ 205 18 1 52 3/ Total 10,664 17,309 18,226 14,500 7,821 9,877 6,118 Expenditures for Equipment New 39,828 3/ 55,902 57,436 26,986 16,918 3/ Used 78 3/ 77 38 12 41 3/ Total 39,905 42,442 55,980 57,474 26,998 16,959 15,922 Total Expenditures for Structures and Equipment $50,570 $59,752 $74,206 $71,974 $34,819 $26,836 $24,020 Wireless Telecommunications Carriers (Except Satellite) Expenditures for Structures New $2,387 $5,026 $7,674 $11,313 $8,245 $11,512 $11,685 Used * 3 58 8 7 2 31 Total 2,387 5,030 7,732 11,321 8,252 11,514 11,716 Expenditures for Equipment New 5,841 9,350 17,589 12,695 12,210 9,459 12,278 Used 6 43 161 13 29 16 4 Total 5,841 9,393 17,750 12,708 12,238 9,475 12,282 Total Expenditures for Structures and Equipment $8,228 $14,422 $25,482 $24,028 $20,490 $20,989 $23,998 Telecommunications Resellers, Satellite, and Other Telecommunications Expenditures for Structures New $2,089 $1,410 $1,951 $2,233 $1,556 $3,499 $397 Used * 4 3 5 3 133 6 Total 2,089 1,414 1,954 2,238 1,560 3,632 403 Expenditures for Equipment New 4,188 8,795 11,495 7,288 4,119 809 3,095 Used 4 49 164 78 12 96 22 Total 4,192 8,845 11,659 7,367 4,131 905 3,117 Total Expenditures for Structures and Equipment $6,281 $10,259 $13,613 $9,605 $5,691 $4,337 $3,520 Telephone and Other Communications Services Expenditures for Structures New $6,545 $9,193 $9,672 $15,128 3/ $27,646 $28,028 $17,621 $24,836 $12,082 Used 263 185 218 12 3/ 266 31 11 187 37 Total 6,809 9,378 9,890 15,140 23,753 27,912 28,059 17,633 25,023 18,237 Expenditures for Equipment New 30,802 37,985 46,667 49,857 3/ 84,986 77,419 43,315 27,186 15,373 Used 138 299 406 88 3/ 402 129 53 153 26 Total 30,939 38,283 47,074 49,938 60,680 85,389 77,549 43,367 27,339 31,321 Total Expenditures for Structures and Equipment $37,799 $47,661 $56,963 $65,079 $84,433 $113,301 $105,607 $61,000 $52,162 $51,538 Note: Detail may not add to totals shown due to rounding. * Represents amounts greater than $0 but less than $500,000. 1/ Capital expenditures include capitalized computer sofware, capitalized interest during construction and expenditures for land development and improvement. Capital expenditures exclude equipment acquired under operating leases, good will and expenditures for subsidiaries and branches located outside the United States. 2/ For 1995 through 1997, data represent Standard Industrial Classification (SIC) industries 481, 482, and 489. Starting in 1998, data are based on the North American Industry Classification System (NAICS). NAICS Codes are 51331 for Wireline 51332 for Wireless and 51333, 51334 and 51339 for others. For 2004 they are 5171, 5172, and 5173, 5174, and 5179, respectively. 3/ Data withheld by the Census Bureau to maintain firm confidentiality Source: U.S. Census Bureau, Annual Capital Expenditures, (Issued March 2006) Table 4a. See: http://www.census.gov/csd/ace/ 17 - 11 Chart 17.2 Capital Expenditures for Structures and Equipment by Carriers Per Dollar of End-User Telecommunications Revenues 1 Source: U.S. Census Bureau, Annual Capital Expenditures ; Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006). 1 Capital expenditures per dollar of end-user telecommunications revenues are derived by dividing expenditures figures in Table 17.6 by end-user revenues data in Table 15.1. Wireline, Reseller, Satellite & Other end-user revenues are calculated by subtracting wireless end-user revenues from total end-user revenues. $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 Wireless Carriers $0.25 $0.32 $0.44 $0.35 $0.27 $0.25 $0.25 Wireline, Resellers, Satellite & Other $0.35 $0.41 $0.51 $0.49 $0.26 $0.18 $0.17 1998 1999 2000 2001 2002 2003 2004 17 - 12 18 - 1 18 Telephone Numbers In 1994, many area codes were nearing exhaustion as demand for telephone numbers continued to rise. At the time, the middle digit of all area codes was either a 0 or a 1, and the supply of those area codes was dwindling. On January 1, 1995, the restriction on the middle digit was removed, making 640 new area codes available. New area codes were added at a rapid rate during the late 1990s, with forty-four new area codes being opened in 1997 alone. Subsequent years saw fewer added area codes. In 2000, thirteen area codes were added, and in 2005 two area codes were added. The North American Numbering Plan Administration (NANPA) (which is part of NeuStar, Inc.) expects to open four new area codes in 2006. The above counts of area code activation are for the contiguous United States, offshore points, Canada, and the Caribbean. Table 18.1 shows historical area code information by state from 1947 to 2006. The changes in area codes from 1999 to 2006 are shown in Table 18.2. AT&T introduced toll-free service in 1967. The Commission changed procedures for routing toll-free calls on May 1, 1993 to make toll-free numbers "portable." This change enabled customers to switch service providers yet still retain their toll-free numbers. Between 1993 and 2000, the quantity of assigned toll-free numbers grew rapidly: growing from 3.9 million in 1993 to 24.2 million in 2000. New toll-free calling codes were opened to meet the demand. In March 1996, calling code 888 was placed into service. The third toll-free calling code (877) went into effect April 4, 1998, and the fourth toll-free calling code (866) went into effect July 29, 2000. The growth of toll-free telephone numbers for the four toll-free codes (800, 888, 877, and 866) is shown in Table 18.3 and Chart 18.1. Tables 18.4 through 18.7 show the growth of each individual toll-free code: 800, 888, 877, and 866, respectively. In the event that another toll-free code is needed, the 855 code would be opened. Database Service Management, Inc./Team DSMI, a subsidiary of Telcordia Technologies, Inc., maintains the Toll-Free Service Management System for the United States and Canada. Dialing patterns differ from state to state. For instance, in some states, callers making local calls within an area code are required to dial only the 7-digit phone number. In other states, callers making local calls must dial the ten-digit phone number (area code plus the phone number). Finally, in some states, local callers must dial a “1” before dialing the area code plus the phone number. Each state’s public utilities commission (or public service commission) determines the calling pattern for each area code in their state. The dialing patterns for area codes are listed in area code planning letters, which are available on the North American Numbering Plan Administrator’s web site at www.nanpa.com. For both local and domestic toll calls, there are two basic types of calls: those within an area code and those between area codes. Table 18.8 shows the dialing patterns for all four types of calls. The last column of Table 18.8 indicates whether all toll calls in that state require callers to dial a “1” before the telephone number. Area Code State/Jurisdiction Area Code Opened Area Code State/ Jurisdiction Area Code Opened Area Code State/ Jurisdiction Area Code Opened Area Code State/ Jurisdiction Area Code Opened 205 Alabama Jan-47 478 Georgia Aug-00 952 Minnesota Feb-00 724 Pennsylvania Feb-98 334 Alabama Jan-95 762 Georgia May-06 601 Mississippi Jan-47 570 Pennsylvania Dec-98 256 Alabama Mar-98 671 Guam Jul-97 228 Mississippi Sep-97 484 Pennsylvania Jun-99 251 Alabama Jun-01 808 Hawaii Jan-57 662 Mississippi Apr-99 267 Pennsylvania Jul-99 907 Alaska Jan-57 208 Idaho Jan-47 769 Mississippi Mar-05 878 Pennsylvania Aug-01 602 Arizona Jan-47 217 Illinois Jan-47 314 Missouri Jan-47 787 Puerto Rico Mar-96 520 Arizona Mar-95 312 Illinois Jan-47 816 Missouri Jan-47 939 Puerto Rico Sep-01 480 Arizona Mar-99 618 Illinois Jan-47 417 Missouri Jan-50 401 Rhode Island Jan-47 623 Arizona Mar-99 815 Illinois Jan-47 573 Missouri Jan-96 803 South Carolina Jan-47 928 Arizona Jun-01 309 Illinois Jan-57 660 Missouri Oct-97 864 South Carolina Dec-95 501 Arkansas Jan-47 708 Illinois Nov-89 636 Missouri May-99 843 South Carolina Mar-98 870 Arkansas Apr-97 847 Illinois Jan-96 406 Montana Jan-47 605 South Dakota Jan-47 479 Arkansas Jan-02 630 Illinois Aug-96 402 Nebraska Jan-47 901 Tennessee Jan-47 213 California Jan-47 773 Illinois Oct-96 308 Nebraska Jan-55 615 Tennessee Jan-54 415 California Jan-47 224 Illinois Jan-02 702 Nevada Jan-47 423 Tennessee Sep-95 916 California Jan-47 219 Indiana Jan-47 775 Nevada Dec-98 931 Tennessee Sep-97 714 California Jan-51 317 Indiana Jan-47 603 New Hampshire Jan-47 865 Tennessee Nov-99 805 California Jan-57 812 Indiana Jan-47 201 New Jersey Jan-47 731 Tennessee Feb-01 209 California Jan-58 765 Indiana Feb-97 609 New Jersey Jan-57 214 Texas Jan-47 408 California Jan-59 260 Indiana Jan-02 908 New Jersey Nov-90 512 Texas Jan-47 707 California Jan-59 574 Indiana Jan-02 732 New Jersey Jun-97 713 Texas Jan-47 619 California Jan-82 319 Iowa Jan-47 973 New Jersey Jun-97 915 Texas Jan-47 818 California Jan-84 515 Iowa Jan-47 856 New Jersey Jun-99 817 Texas Jan-53 510 California Sep-91 712 Iowa Jan-47 551 New Jersey Dec-01 806 Texas Jan-57 310 California Nov-91 641 Iowa Jul-00 848 New Jersey Dec-01 409 Texas Nov-82 909 California Nov-92 563 Iowa Mar-01 862 New Jersey Dec-01 903 Texas Nov-90 562 California Jan-97 316 Kansas Jan-47 505 New Mexico Jan-47 210 Texas Nov-92 760 California Mar-97 913 Kansas Jan-47 212 New York Jan-47 972 Texas Sep-96 626 California Jun-97 785 Kansas Jul-97 315 New York Jan-47 281 Texas Nov-96 650 California Aug-97 620 Kansas Feb-01 518 New York Jan-47 254 Texas May-97 530 California Nov-97 502 Kentucky Jan-47 716 New York Jan-47 940 Texas May-97 925 California Mar-98 606 Kentucky Jan-55 914 New York Jan-47 830 Texas Jul-97 949 California Apr-98 270 Kentucky Apr-99 516 New York Jan-51 956 Texas Jul-97 323 California Jun-98 859 Kentucky Apr-00 607 New York Jan-54 832 Texas Jan-99 831 California Jul-98 504 Louisiana Jan-47 718 New York Sep-84 361 Texas Feb-99 559 California Nov-98 318 Louisiana Jan-57 917 New York Jan-92 469 Texas Jul-99 661 California Feb-99 225 Louisiana Aug-98 646 New York Jul-99 936 Texas Feb-00 858 California Jun-99 337 Louisiana Oct-99 347 New York Oct-99 979 Texas Feb-00 951 California Jul-04 985 Louisiana Feb-01 631 New York Nov-99 682 Texas Oct-00 424 California Aug-06 207 Maine Jan-47 845 New York Jun-00 430 Texas Feb-03 303 Colorado Jan-47 301 Maryland Jan-47 585 New York Nov-01 325 Texas Apr-03 719 Colorado Mar-88 410 Maryland Oct-91 704 North Carolina Jan-47 432 Texas Apr-03 970 Colorado Apr-95 240 Maryland Jun-97 919 North Carolina Jan-54 340 US Virgin Islands Jun-97 720 Colorado Jun-98 443 Maryland Jun-97 910 North Carolina Nov-93 801 Utah Jan-47 203 Connecticut Jan-47 413 Massachusetts Jan-47 336 North Carolina Dec-97 435 Utah Sep-97 860 Connecticut Aug-95 617 Massachusetts Jan-47 252 North Carolina Mar-98 802 Vermont Jan-47 302 Delaware Jan-47 508 Massachusetts Jul-88 828 North Carolina Mar-98 703 Virginia Jan-47 202 District of Columbia Jan-47 781 Massachusetts Sep-97 980 North Carolina Apr-01 804 Virginia Jun-73 305 Florida Jan-47 978 Massachusetts Sep-97 701 North Dakota Jan-47 540 Virginia Jul-95 813 Florida Jan-53 339 Massachusetts May-01 670 Northern Marianas Is. Jul-97 757 Virginia Jul-96 904 Florida Jul-65 351 Massachusetts May-01 216 Ohio Jan-47 571 Virginia Mar-00 407 Florida Apr-88 774 Massachusetts May-01 419 Ohio Jan-47 434 Virginia Jun-01 941 Florida May-95 857 Massachusetts May-01 513 Ohio Jan-47 276 Virginia Sep-01 954 Florida Sep-95 313 Michigan Jan-47 614 Ohio Jan-47 206 Washington Jan-47 352 Florida Dec-95 517 Michigan Jan-47 330 Ohio Mar-96 509 Washington Jan-57 561 Florida May-96 616 Michigan Jan-47 937 Ohio Sep-96 360 Washington Jan-95 850 Florida Jun-97 906 Michigan Jan-61 440 Ohio Aug-97 253 Washington Apr-97 786 Florida Mar-98 810 Michigan Dec-93 740 Ohio Dec-97 425 Washington Apr-97 727 Florida Jul-98 248 Michigan May-97 234 Ohio Oct-00 304 West Virginia Jan-47 863 Florida Sep-99 734 Michigan Dec-97 567 Ohio Jan-02 414 Wisconsin Jan-47 321 Florida Nov-99 231 Michigan Jun-99 405 Oklahoma Jan-47 715 Wisconsin Jan-47 386 Florida Feb-01 989 Michigan Apr-01 918 Oklahoma Jan-53 608 Wisconsin Jan-55 754 Florida Aug-01 586 Michigan Sep-01 580 Oklahoma Nov-97 920 Wisconsin Jul-97 772 Florida Feb-02 269 Michigan Jul-02 503 Oregon Jan-47 262 Wisconsin Sep-99 239 Florida Mar-02 947 Michigan Sep-02 541 Oregon Nov-95 307 Wyoming Jan-47 404 Georgia Jan-47 218 Minnesota Jan-47 971 Oregon Oct-00 912 Georgia Jan-54 612 Minnesota Jan-47 215 Pennsylvania Jan-47 706 Georgia May-92 507 Minnesota Jan-54 412 Pennsylvania Jan-47 770 Georgia Aug-95 320 Minnesota Mar-96 717 Pennsylvania Jan-47 678 Georgia Jan-98 651 Minnesota Jul-98 814 Pennsylvania Jan-47 229 Georgia Aug-00 763 Minnesota Feb-00 610 Pennsylvania Jan-94 Source: North American Numbering Plan Administrator. Table 18.1 Area Codes by State (1947 - 2006) 18 - 3 Table 18.2 Area Code Assignments (1999-2006) Location Date Previous Added Code Code Texas (Houston) Jan-99 713 832 California Feb-99 805 661 Texas Feb-99 512 361 Arizona Mar-99 602 480 Arizona Mar-99 602 623 Kentucky Apr-99 502 270 Mississippi Apr-99 601 662 Alberta May-99 403 780 Missouri May-99 314 636 Michigan Jun-99 616 231 Pennsylvania Jun-99 610 484 California Jun-99 619 858 New Jersey Jun-99 609 856 New York (Manhattan) Jul-99 212 646 Pennsylvania Jul-99 215 267 Texas (Dallas) Jul-99 214 469 Florida Sep-99 941 863 Wisconsin Sep-99 414 262 New York Oct-99 718 347 Louisiana Oct-99 318 337 Florida Nov-99 407 321 New York Nov-99 516 631 Tennessee Nov-99 423 865 Texas Feb-00 409 936 Texas Feb-00 409 979 Minnesota Feb-00 612 763 Minnesota Feb-00 612 952 Virginia Mar-00 703 571 Kentucky Apr-00 606 859 New York Jun-00 914 845 Iowa Jul-00 515 641 Georgia Aug-00 912 229 Georgia Aug-00 912 478 Oregon Oct-00 503 971 Texas Oct-00 817 682 Ohio Oct-00 330 234 Kansas Feb-01 316 620 Louisiana Feb-01 504 985 Tennessee Feb-01 901 731 Florida Feb-01 904 386 Ontario Mar-01 416 647 Iowa Mar-01 319 563 North Carolina Apr-01 704 980 Michigan Apr-01 517 989 Massachusetts May-01 508 774 18 - 4 Table 18.2 Area Code Assignments -- Continued (1999-2006) Location Date Previous Added Code Code Massachusetts May-01 617 857 Massachusetts May-01 781 339 Massachusetts May-01 978 351 Virginia Jun-01 804 434 Ontario Jun-01 905 289 Alabama Jun-01 334 251 Arizona Jun-01 520 928 Florida Aug-01 954 754 Pennsylvania Aug-01 412 878 Virginia Sep-01 540 276 Puerto Rico Sep-01 787 939 Michigan Sep-01 810 586 British Columbia Nov-01 604 778 New York Nov-01 716 585 New Jersey Dec-01 201 551 New Jersey Dec-01 732 848 New Jersey Dec-01 973 862 Ohio Jan-02 419 567 Illinois Jan-02 847 224 Indiana Jan-02 219 260 Indiana Jan-02 219 574 Arkansas Jan-02 501 479 Florida Feb-02 561 772 Florida Mar-02 941 239 Michigan Jul-02 616 269 Michigan Sep-02 248 947 Texas Feb-03 903 430 Texas Apr-03 915 325 Texas Apr-03 915 432 California Jul-04 909 951 Mississippi Mar-05 601 769 Dominican Republic Aug-05 809 829 Georgia May-06 706 762 California Aug-06 310 424 Ontario Oct-06 519 226 Quebec Nov-06 514 438 NA - Not applicable. Note: For years 1984 - 1998, see Industry Analysis Division, Wireline Competition Bureau, Trends in Telephone Service (August 2003). Source: North American Numbering Plan Administrator (NANPA), which can be accessed at www.nanpa.com. 18 - 5 Table 18.3 Telephone Numbers Assigned for Toll-Free Service (800, 888, 877, 866) Working Miscellaneous Total Spare Numbers Year Month Numbers Numbers 1 Numbers Still Available 1993 December 3,155,955 731,438 3,887,393 3,822,607 1994 December 4,948,605 763,235 5,711,840 1,998,160 1995 December 6,700,576 286,487 6,987,063 722,937 1996 December 9,527,982 945,671 10,473,653 5,216,347 1997 December 12,980,714 996,449 13,977,163 1,712,837 1998 December 16,200,883 965,466 17,166,349 6,503,651 1999 December 19,677,001 1,101,964 20,778,965 2,891,035 2000 December 23,022,015 1,178,096 24,200,111 7,449,889 2001 December 23,453,029 1,027,973 24,481,002 7,168,998 2002 December 22,496,215 1,051,232 23,547,447 8,102,553 2003 December 21,108,662 941,520 22,050,182 9,599,818 2004 December 22,159,440 1,145,661 23,305,101 8,344,899 2005 December 22,474,643 957,835 23,432,478 8,217,522 2006 June 22,292,943 1,113,803 23,406,746 8,243,254 Note: For individual month assignments through June 2003, see Industry Analysis and Technology Division, Wireline Competition Bureau, Trends in Telephone Service (August 2003). * Toll-free (800) service was initially offered by AT&T in 1967. On May 1, 1993, procedures for routing toll- free calls were changed and 800 numbers were made "portable" so customers who switched service providers could retain their numbers. Due to the growth in toll-free numbers, a new toll-free calling code, 888, was added in March 1996, which made it possible to assign about 8 million new toll-free numbers. A third toll-free calling code, 877, was added in April 1998; and a fourth toll-free code, 866, was added in July 2000. 1 Miscellaneous numbers include those in the 800, 888, 877, and 866 service management systems maintained by Database Service Management, Inc., and categorized as reserved, assigned but not yet activated, recently disconnected, or suspended. Chart 18.1 Working Toll-Free Numbers (Numbers in Millions) 0.0 5.0 10.0 15.0 20.0 25.0 Numbers 3.2 4.9 6.7 9.5 13.0 16.2 19.7 23.0 23.5 22.5 21.1 22.2 22.5 22.3 Dec 1993 Dec 1994 Dec 1995 Dec 1996 Dec 1997 Dec 1998 Dec 1999 Dec 2000 Dec 2001 Dec 2002 Dec 2003 Dec 2004 Dec 2005 Jun 2006 18 - 6 Table 18.4 Telephone Numbers Assigned for 800 Toll-Free Service Working Miscellaneous Total Spare Numbers Year Month Numbers Numbers 1 Numbers Still Available 1993 June 2,589,123 722,006 3,311,129 4,398,871 September 2,818,262 639,547 3,457,809 4,252,191 December 3,155,955 731,438 3,887,393 3,822,607 1994 March 3,516,620 743,813 4,260,433 3,449,567 June 3,933,037 792,698 4,725,735 2,984,265 September 4,506,014 841,381 5,347,395 2,362,605 December 4,948,605 763,235 5,711,840 1,998,160 1995 March 5,528,723 793,771 6,322,494 1,387,506 June 6,340,534 481,633 6,822,167 887,833 September 6,503,018 437,215 6,940,233 769,767 December 6,700,576 286,487 6,987,063 722,937 1996 March 6,907,098 293,244 7,200,342 509,658 June 6,986,821 324,899 7,311,720 398,280 September 7,119,167 310,562 7,429,729 280,271 December 7,272,819 343,905 7,616,724 93,276 1997 March 7,402,769 305,362 7,708,131 1,869 June 7,415,591 293,802 7,709,393 607 September 7,427,717 280,668 7,708,385 1,615 December 7,429,160 267,429 7,696,589 13,411 1998 March 7,455,240 249,964 7,705,204 4,796 June 7,480,468 227,041 7,707,509 2,491 September 7,489,271 219,080 7,708,351 1,649 December 7,487,529 215,267 7,702,796 7,204 1999 March 7,498,527 204,515 7,703,042 6,958 June 7,502,118 207,061 7,709,179 821 September 7,523,302 185,363 7,708,665 1,335 December 7,505,737 202,416 7,708,153 1,847 2000 March 7,516,391 193,246 7,709,637 363 June 7,570,082 139,444 7,709,526 474 September 7,572,091 137,705 7,709,796 204 December 7,566,810 132,887 7,699,697 10,303 2001 March 7,434,621 264,967 7,699,588 10,412 June 7,357,279 242,106 7,599,385 110,615 September 7,383,111 164,881 7,547,992 162,008 December 7,370,055 184,689 7,554,744 155,256 2002 March 7,181,636 400,955 7,582,591 127,409 June 7,234,847 282,005 7,516,852 193,148 September 7,200,821 177,723 7,378,544 331,456 December 7,210,159 203,268 7,413,427 296,573 2003 March 7,182,120 224,536 7,406,656 303,344 June 7,171,068 234,576 7,405,644 304,356 September 7,031,806 222,846 7,254,652 455,348 December 7,089,752 260,807 7,350,559 359,441 2004 March 7,187,381 234,719 7,422,100 287,900 June 7,181,216 187,107 7,368,323 341,677 September 7,262,915 197,252 7,460,167 249,833 December 7,332,085 208,368 7,540,453 169,547 2005 March 7,267,936 234,679 7,502,615 207,385 June 7,163,402 425,206 7,588,608 121,392 September 7,160,678 495,326 7,656,004 53,996 December 7,317,165 277,052 7,594,217 115,783 2006 March 7,416,046 197,083 7,613,129 96,871 June 7,330,416 317,525 7,647,941 62,059 See Table 18.3 notes. 18 - 7 Table 18.5 Telephone Numbers Assigned for 888 Toll-Free Service Working Miscellaneous Total Spare Numbers Year Month Numbers Numbers 1 Numbers Still Available 1996 March 267,874 568,574 836,448 7,143,552 June 922,849 544,079 1,466,928 6,513,072 September 1,641,519 590,345 2,231,864 5,748,136 December 2,255,163 601,766 2,856,929 5,123,071 1997 March 2,857,608 661,164 3,518,772 4,461,228 June 3,660,984 681,981 4,342,965 3,637,035 September 4,776,688 774,431 5,551,119 2,428,881 December 5,551,554 729,020 6,280,574 1,699,426 1998 March 6,167,479 728,415 6,895,894 1,084,106 June 6,591,764 665,496 7,257,260 722,740 September 6,898,718 612,254 7,510,972 469,028 December 7,146,159 515,009 7,661,168 318,832 1999 March 7,278,531 495,904 7,774,435 205,565 June 7,428,424 231,697 7,660,121 319,879 September 7,601,867 211,318 7,813,185 166,815 December 7,643,158 324,405 7,967,563 12,437 2000 March 7,685,423 230,035 7,915,458 64,542 June 7,789,986 140,658 7,930,644 49,356 September 7,806,252 173,588 7,979,840 160 December 7,789,188 177,328 7,966,516 13,484 2001 March 7,616,189 355,451 7,971,640 8,360 June 7,548,761 270,198 7,818,959 161,041 September 7,508,100 203,518 7,711,618 268,382 December 7,452,071 190,727 7,642,798 337,202 2002 March 6,964,624 577,910 7,542,534 437,466 June 6,629,862 354,771 6,984,633 995,367 September 6,682,043 92,050 6,774,093 1,205,907 December 6,610,191 154,015 6,764,206 1,215,794 2003 March 6,408,723 324,558 6,733,281 1,246,719 June 6,228,846 251,701 6,480,547 1,499,453 September 5,818,266 216,862 6,035,128 1,944,872 December 5,711,949 250,662 5,962,611 2,017,389 2004 March 5,680,105 133,824 5,813,929 2,166,071 June 5,640,743 128,141 5,768,884 2,211,116 September 5,716,957 210,068 5,927,025 2,052,975 December 5,563,469 384,320 5,947,789 2,032,211 2005 March 5,465,594 159,097 5,624,691 2,355,309 June 5,306,927 296,729 5,603,656 2,376,344 September 5,314,969 221,122 5,536,091 2,443,909 December 5,265,331 196,817 5,462,148 2,517,852 2006 March 5,049,966 321,175 5,371,141 2,608,859 June 4,930,941 387,726 5,318,667 2,661,333 See Table 18.3 notes. 18 - 8 Table 18.6 Telephone Numbers Assigned for 877 Toll-Free Service Working Miscellaneous Total Spare Numbers Year Month Numbers Numbers 1 Numbers Still Available 1998 June 552,037 209,967 762,004 7,217,996 September 1,072,046 206,714 1,278,760 6,701,240 December 1,567,195 235,190 1,802,385 6,177,615 1999 March 2,141,228 329,044 2,470,272 5,509,728 June 2,899,466 410,026 3,309,492 4,670,508 September 3,755,361 436,433 4,191,794 3,788,206 December 4,528,106 575,143 5,103,249 2,876,751 2000 March 5,436,297 598,702 6,034,999 1,945,001 June 6,317,507 402,858 6,720,365 1,259,635 September 6,539,180 496,015 7,035,195 944,805 December 6,391,285 719,333 7,110,618 869,382 2001 March 6,289,079 469,980 6,759,059 1,220,941 June 6,094,898 715,097 6,809,995 1,170,005 September 6,163,297 489,084 6,652,381 1,327,619 December 6,214,863 345,468 6,560,331 1,419,669 2002 March 6,174,529 340,472 6,515,001 1,464,999 June 6,016,107 267,320 6,283,427 1,696,573 September 5,656,158 275,722 5,931,880 2,048,120 December 5,448,276 421,984 5,870,260 2,109,740 2003 March 5,132,413 579,240 5,711,653 2,268,347 June 4,791,792 376,236 5,168,028 2,811,972 September 4,617,147 170,787 4,787,934 3,192,066 December 4,536,366 191,410 4,727,776 3,252,224 2004 March 4,528,716 163,856 4,692,572 3,287,428 June 4,550,870 146,826 4,697,696 3,282,304 September 4,537,840 214,197 4,752,037 3,227,963 December 4,551,486 254,082 4,805,568 3,174,432 2005 March 4,590,227 139,089 4,729,316 3,250,684 June 4,498,452 232,477 4,730,929 3,249,071 September 4,476,657 193,315 4,669,972 3,310,028 December 4,424,365 212,543 4,636,908 3,343,092 2006 March 4,387,383 178,974 4,566,357 3,413,643 June 4,227,661 203,501 4,431,162 3,548,838 See Table 18.3 notes. 18 - 9 Table 18.7 Telephone Numbers Assigned for 866 Toll-Free Service Working Miscellaneous Total Spare Numbers Year Month Numbers Numbers 1 Numbers Still Available 2000 September 672,250 155,646 827,896 7,152,104 December 1,274,732 148,548 1,423,280 6,556,720 2001 March 1,652,602 361,888 2,014,490 5,965,510 June 1,944,520 362,880 2,307,400 5,672,600 September 2,256,792 308,801 2,565,593 5,414,407 December 2,416,040 307,089 2,723,129 5,256,871 2002 March 2,640,414 321,530 2,961,944 5,018,056 June 2,864,605 219,232 3,083,837 4,896,163 September 2,977,379 244,297 3,221,676 4,758,324 December 3,227,589 271,965 3,499,554 4,480,446 2003 March 3,461,686 299,700 3,761,386 4,218,614 June 3,486,674 420,477 3,907,151 4,072,849 September 3,609,244 265,446 3,874,690 4,105,310 December 3,770,595 238,641 4,009,236 3,970,764 2004 March 3,966,922 231,683 4,198,605 3,781,395 June 4,281,378 263,560 4,544,938 3,435,062 September 4,476,150 281,577 4,757,727 3,222,273 December 4,712,400 298,891 5,011,291 2,968,709 2005 March 5,015,324 267,412 5,282,736 2,697,264 June 5,047,314 487,471 5,534,785 2,445,215 September 5,259,730 352,226 5,611,956 2,368,044 December 5,467,782 271,423 5,739,205 2,240,795 2006 March 5,613,475 211,021 5,824,496 2,155,504 June 5,803,925 205,051 6,008,976 1,971,024 See Table 18.3 notes. 18 - 10 Table 18.8 Number of Digits Necessary to Dial Local and Toll Calls in the U.S. (As of June 2006) Local Calls Toll Calls Toll Calls Within Same Between Within Same Between Require State Area Code Area Codes Area Code Area Codes Dialing 1 + Alabama 7 1 10 2 1 + 10 1 + 10 Yes Alaska 7 1 + 10 1 + 10 1 + 10 Yes Arizona 7 10 1 + 10 1 + 10 Yes Arkansas 7 10 1 + 10 1 + 10 Yes California 7 3 1 + 10 7 3 1 + 10 No Colorado 7 4 10 1 + 10 1 + 10 Yes Connecticut 7 5 10 1 + 10 1 + 10 Yes Delaware 7 10 1 + 10 1 + 10 Yes District of Columbia 7 10 NA 1 + 10 Yes Florida 7 6 10 1 + 10 1 + 10 Yes Georgia 7 7 10 1 + 10 1 + 10 Yes Hawaii 7 NA 1 + 10 1 + 10 Yes Idaho 7 7 1 + 10 1 + 10 Yes Illinois 7 8 1 + 10 1 + 10 1 + 10 Yes Indiana 7 10 1 + 10 1 + 10 Yes Iowa 7 10 1 + 10 1 + 10 Yes Kansas 7 10 1 + 10 1 + 10 Yes Kentucky 7 10 9 1 + 10 1 + 10 Yes Louisiana 7 10 1 + 10 1 + 10 Yes Maine 7 1 + 10 7 1 + 10 No Maryland 10 10 1 + 10 1 + 10 Yes Massachusetts 10 10 10 1 + 10 1 + 10 Yes Michigan 7 11 10 1 + 10 1 + 10 Yes Minnesota 7 10 12 1 + 10 1 + 10 Yes Mississippi 7 13 10 1 + 10 1 + 10 Yes Missouri 7 14 10 1 + 10 1 + 10 Yes Montana 7 7 1 + 10 1 + 10 Yes Nebraska 7 7 1 + 10 1 + 10 Yes Nevada 7 10 1 + 10 1 + 10 Yes New Hampshire 7 1 + 10 7 1 + 10 No New Jersey 10 15 1 + 10 10 15 1 + 10 No New Mexico 7 NA 1 + 10 1 + 10 Yes New York 7 16 1 + 10 7 16 1 + 10 No North Carolina 7 17 10 1 + 10 1 + 10 Yes North Dakota 7 7 1 + 10 1 + 10 Yes Ohio 7 18 10 1 + 10 1 + 10 Yes Oklahoma 7 7 1 + 10 1 + 10 Yes Oregon 10 19 10 1 + 10 1 + 10 Yes Pennsylvania 10 20 1 + 10 21 10 20 1 + 10 No Rhode Island 7 1 + 10 7 1 + 10 No South Carolina 7 10 1 + 10 1 + 10 Yes South Dakota 7 7 1 + 10 1 + 10 Yes Tennessee 7 10 22 1 + 10 1 + 10 Yes Texas 7 23 10 1 + 10 1 + 10 Yes Utah 7 10 24 1 + 10 1 + 10 Yes Vermont 7 1 + 10 1 + 10 1 + 10 Yes Virginia 7 25 10 1 + 10 1 + 10 Yes Washington 7 26 10 1 + 10 1 + 10 Yes West Virginia 7 7 1 + 10 1 + 10 Yes Wisconsin 7 1 + 10 1 + 10 1 + 10 Yes Wyoming 7 7 1 + 10 1 + 10 Yes NA - Not Applicable. Source: NPA database. The database is available at www.nanpa.com/area_codes/index.html. 18 - 11 Notes to Table 18.8 1 In area code 659, 10-digit dialing is used. 2 In area code 659, 1+10-digit dialing is used. 3 In area codes 424 and 310, 1+10-digit dialing is used. 4 In area codes 303 and 720, 10-digit dialing is used. 5 In area codes 475 and 959, 10-digit dialing is used. 6 In area codes 305, 321, 407, 689, 754, 786, and 954, 10-digit dialing is used. 7 In area codes 404, 470, 678, 762 and 770, 10-digit dialing is used. 8 In area codes 224, 331, 872, 464, 706 and 847, 1+ 10-digit dialing is used. 9 In area codes 270 and 502, 7-digit dialing is used. 10 In area code 413, 7-digit dialing is used. 11 In area codes 248, 679 and 947, 10-digit dialing is used. 12 In area codes 218, 320, and 507, 7-digit dialing is used. 13 In area codes 601 and 769, 10-digit dialing is used. 14 In area codes 557 and 975, 10-digit dialing is used. 15 In area codes 609, 856, and 908, 7-digit dialing is used. 16 In area codes 212, 347, 646, 718, and 917, 1+10 digit dialing is used. 17 In area codes 704, 980 and 984, 10-digit dialing is used. 18 In area codes 234, 283, 330, 380, 419, and 567, 10-digit dialing is used. 19 In area code 541, 7-digit dialing is used. 20 In area codes 570, 717, and 814, 7-digit dialing is used. 21 In some area codes, local calls to some other area codes may be dialed using 10 digits. 22 In area codes 615 and 931, 7-digit dialing is used. 23 In area codes 214, 281, 430, 469, 682, 713, 817, 832, 903, and 972, 10-digit dialing is used. 24 In area code 435, 7-digit dialing is used. 25 In area codes 571 and 703, 10-digit dialing is used. 26 In area code 564, 10-digit dialing is used. 18 - 12 19 - 1 19 Universal Service 1. Overview There are four universal service support mechanisms: 1) High Cost, 2) Low Income, including Lifeline and Link-Up, 3) Schools and Libraries, and 4) Rural Health Care. 1 High Cost support enables carriers with above-average costs to recover some of these costs from the support mechanisms, allowing these carriers to lower their end-user rates and/or to receive less money from state universal service support mechanisms. The Lifeline program promotes increased telephone subscribership by providing low- income households with discounts on the monthly cost of telephone service. The Link-Up America program promotes telephone subscribership by helping low-income households pay the initial costs of commencing telephone service. Schools and Libraries support enables eligible schools and libraries to obtain eligible services, including telecommunications services, at discounted rates. Rural Health Care support allows rural health care providers to purchase telecommunications services at comparable urban rates. Table 19.1 shows universal service support disbursements for 2005. 2 Chart 19.1 shows this information graphically for 2005. Table 19.2 and Chart 19.2 show the type of service providers that received universal service support in 2005. 2. High Cost The High Cost support mechanisms include embedded high-cost loop support (HCLS), 3 safety net additive support (SNAS), safety valve support (SVS), local switching support (LSS), forward-looking high-cost model support (HCMS), interstate access support (IAS) for price-cap carriers, and interstate common line support (ICLS) for rate-of-return carriers. 4 HCLS provides assistance to companies with above average non-traffic-sensitive local loop costs – terminology that refers to the costs of providing loops connecting customers and their serving telephone company central office. In addition, SNAS provides assistance to companies that have large increases in telecommunications plant in service. SVS provides 1 Additional information on universal service mechanisms is available in the Universal Service Monitoring Report (December 2006). See http://www.fcc.gov/wcb/iatd/monitor.html. 2 The figures used in this table are for the calendar year and include disbursements that were paid out in 2005. 3 This was formerly referred to as the Universal Service Fund, and still bears that name in the Commission rules. It is now referred to as high-cost loop support to avoid confusion with the new, more comprehensive universal service support mechanisms that the Commission developed to implement the 1996 Act. See 47 C.F.R. ง 36.601. 4 Prior to July 1, 2004, rate-of-return carriers were eligible to receive long-term support (LTS). Since that date, LTS was merged into ICLS. 19 - 2 additional assistance to rural carriers that make substantial investment after acquiring exchanges. LSS provides assistance to LECs with study areas of 50,000 or fewer access lines to help defray their higher per-line switching costs. HCMS provides assistance for non-rural carriers based on their forward-looking costs of providing supported services as determined by the Commission's cost model. The IAS mechanism provides support to price-cap carriers to replace the implicit support previously collected through interstate access charges. The ICLS mechanism converts support implicit in the access rate structure of rate-of-return carriers to explicit and portable support. ICLS recovers any shortfall between the allowed common line revenues of rate of return carriers and their subscriber line charge revenues. As noted above, LTS was merged into ICLS as of July 1, 2004. Table 19.3 shows HCLS, LTS, LSS, HCMS, IAS, ICLS, SNAS, and SVS payments from 1986 to 2006. Table 19.4 shows payments by state for 2005. Table 19.5 shows high-cost support payments to ILECs and competitive eligible telecommunications carriers (CETCs) from 1996 to the present. Chart 19.4 shows the percent of high-cost support received by CETCs. Table 19.6 shows high-cost support payments by state for 2005 to ILECs and CETCs and also to rural and non-rural carriers. 3. Low-Income Support: Lifeline and Link-Up The Lifeline program promotes increased telephone subscribership by providing low- income households with discounts on the monthly cost of telephone service. The Link-Up America program increases telephone subscribership by helping low-income households pay the initial costs of commencing telephone service. The Lifeline program was created in 1984, and the Link-Up program was created in 1987. For both of these programs, the rules were later modified to make the distribution of low- income support competitively and technologically neutral by allowing all eligible telecommunications carriers, including wireless carriers, to receive support for providing Lifeline and Link-Up service. In June 2000, the Commission further expanded the Lifeline and Link-Up programs to address the needs of households on tribal lands. 5 Eligibility requirements for Lifeline and Link-Up vary from state to state. In a state that has its own Lifeline program, the state may create its own eligibility requirements for the federal Lifeline program. Those criteria must be based solely on income or factors directly related to income. In addition, a state commission must ensure that its qualification criteria are reasonably designed to reach eligible residents of tribal lands within the state. In those states that do not have their own Lifeline program, known as federal default states, Lifeline eligibility requirements are set by the FCC. In federal default states, households must certify that they participate in at least one of the following seven federal programs: Medicaid, food stamps, Supplemental Security Income (SSI), federal public housing assistance, the Low-Income Home Energy Assistance Program (LIHEAP), the National School Lunch Program’s free lunch program, or Temporary Assistance to Needy Families. By June 2005, consumers may also be able to qualify if their income is at or below 135% of the federal poverty guidelines. 5 Federal-State Joint Board on Universal Service; Promoting Deployment and Subscribership in Unserved and Underserved Areas, Including Tribal and Insular Areas, Twelfth Report and Order, and Further Notice of Proposed Rulemaking, CC Docket No. 96-45, FCC 00-208, 15 FCC Rcd 12,208 (2000). 19 - 3 Eligible consumers living on tribal lands can receive federal Lifeline support if they (a) meet their state’s Lifeline eligibility requirements; (b) certify that they are enrolled in one of the seven federal programs listed above; or (c) participate in one of the following federal assistance programs: Bureau of Indian Affairs (BIA) general assistance program, tribally administered Temporary Assistance for Needy Families (TANF), or Head Start (meeting the income- qualifying standard). Under the Commission’s rules, there are four tiers of federal Lifeline support. 6 The first tier represents a monthly waiver of the federal subscriber line charge, which ranges between $3.50 and $6.50, varying by state and the carrier providing service. Second-tier support is an additional $1.75 per-month reduction in the basic local rate. All Lifeline subscribers receive at least the first two tiers of federal support. The third tier of federal support is based on the amount of additional support mandated by the relevant state or otherwise provided by carriers. Federal support is available to match one-half of the tier-three support provided, up to a maximum of $1.75 in federal support. Eligible subscribers living on tribal lands also qualify to receive a fourth tier of Lifeline support. Tier-four support provides up to an additional $25 per month although all subscribers on tribal lands must pay at least $1 per month. The Commission’s Link-Up program provides qualified low-income individuals with a federally financed 50% discount on initial connection charges up to $30. Link-Up beneficiaries also may choose to schedule deferred payments of up to $200 over a one-year period, with the customary interest charges paid through federal support. Eligible subscribers living on tribal lands may receive an additional discount of up to $70 to cover 100% of the charges between $60 and $130. Table 19.7 shows the minimum, maximum and average monthly Lifeline support as of March 31, 2005, by state. The table contains both federal and state support, and indicates the additional contribution from the federal program to reduce local rates where states have authorized statewide or carrier specific intrastate local rate reductions. Table 19.8 contains historical Lifeline subscriber and Link-Up beneficiary data for 1987 through 2005. Table 19.9 present tribal and non-tribal lifeline subscriber and Link-Up beneficiary data by state for 2005. Table 19.10 and Chart 19.5 contain annual historical low-income support payments for the years 1988 through 2005. Table 19.11 shows low-income support payments by state or jurisdiction for 2005. Table 19.12 shows low-income support payments to ILECs and CETCs from 1996 to the present. Chart 19.6 shows the percent of low-income support received by CETCs. 4. Schools and Libraries The schools and libraries support mechanism also known as the “E Rate” enables schools and libraries to obtain eligible services at discounted rates. Eligible schools and libraries receive telecommunications services, Internet access, and internal connections at discounts that range from 20 percent to 90 percent. The level of the discount is generally based on the percentage of students eligible for the national school lunch program, or in the case of libraries, the percentage of students eligible for the national school lunch program in the school district where the library 6 In addition, the Lifeline program compensates eligible telecommunication carriers for toll limitation service (TLS). 19 - 4 is located. In addition, schools and libraries located in rural areas receive an additional discount. Table 19.13 shows funding commitments and disbursements to schools and libraries by funding year since 1998. The commitments and disbursements are shown by the type of service funded (internal connections, Internet access, and telecommunications). Chart 19.7 graphically shows the total schools’ and libraries’ funds committed and disbursed. Table 19.14 shows, on a state-by-state basis, funding commitments to schools and libraries for the July 1, 2004 through June 30, 2005 Funding Year. 5. Rural Health Care The Rural Health Care support mechanism enables health care providers in rural areas to pay no more than their urban counterparts for similar telecommunications services necessary for the provision of health care. Eligible rural health care providers can also receive a 25% discount off the monthly cost of Internet access reasonably related to the health care needs of the facility. Additionally, rural health care providers in entirely rural states are eligible to receive a 50% discount off the monthly cost of advanced telecommunications and information services reasonably related to the health care needs of the facility. Further, mobile rural health care providers utilizing satellite service can receive support for the difference between the rate for the satellite service and the rate for an urban wireline service with a similar bandwith. Table 19.15 and Chart 19.8 show rural health care fund disbursements by service speed since 1998. Table 19.16 shows rural health care fund disbursements by service speed and on a state-by-state basis for the funding period July 1, 2004 through June 30, 2005. 6. Contributions to the Universal Service Fund Carriers contribute to universal service support mechanisms based on interstate and international end-user revenues. Since November 1999, all contributions to the USF are based on interstate end-user revenues. Table 19.17 shows interstate and intrastate contribution rates since the first quarter of 1998. Table 19.18 shows changes in the shares of contributions over time by type of service provider. Shares have changed because of differential pricing, growth trends, mergers and wireless carriers now reporting greater shares of interstate revenues. Mechanism Percent of Total High-Cost Support $3,824 58.7 % High-Cost Loop Support 1,219 18.7 Safety Net Additive Support 15 0.2 Safety-Valve 4 0.1 High-Cost Model Support 292 4.5 Long-Term Support 0 0.0 Interstate Common Line Support 1,178 18.1 Interstate Access Support 691 10.6 Local Switching Support 425 6.5 Low-Income Support 809 12.4 School and Libraries 1,862 28.6 Rural Health Care 26 0.4 All Universal Service Support $6,520 100.0 % Table 19.1 Universal Service Support Mechanisms: 2005 (Dollars in Millions) Disbursements Distribution of Universal Service Payments: 2005 Chart 19.1 Notes: Figures may not add due to rounding. The figures used in this table are for the calendar year and include disbursements that were committed over several years but paid out in calendar year 2005. In Tables 19.12 -19.16, figures for the Schools and Libraries program and the Rural Health Care program are reported based on fiscal year rather than calendar year. Source: Universal Service Administration Company (USAC). Low Income 12.4% High Cost 58.7% Rural Health Care 0.4% Schools & Libraries 28.6% 19 - 5 High Cost Low Income Rural Health Care Schools and Libraries Total Incumbent Local Exchange Carriers $3,185,670 $737,207 $4,412 $551,181 $4,478,470 68.7 % Non-Traditional Providers 1 0 0 0 710,024 710,024 10.9 Wireless Providers 2 602,172 39,608 18 44,530 686,328 10.5 Competitive Local Exchange Carriers 3 36,345 31,749 1,133 264,182 333,409 5.1 Internet Service Providers 0 0 150 133,420 133,570 2.0 Long Distance Providers 4 0 0 19,618 110,796 130,413 2.0 Other Providers 5 0 0 239 47,612 47,851 0.7 Total $3,824,186 $808,565 $25,570 $1,861,745 $6,520,065 100.0 % 2 Wireless providers include cellular, PCS and other mobile providers. 4 Long distance providers include interexchange, operator service, toll resale, pre-paid card and other toll providers. Source: Compiled from data provided to the FCC by Universal Service Adminstrative Company (USAC). Universal Service Support Received by Service Provider Type: 2005 5 Other providers' services include paging and messaging, payphone service, private service, satellite service, specialized mobile service and wireless data. Percent of Total Table 19.2 Universal Service Support Received by Service Provider Type: 2005 (Dollars in Thousands) Chart 19.2 1 Non-traditional providers provide eligible software, hardware, and network devices. 3 Competitive local exchange carriers include competitive access providers, local resale, other local and shared tenant service providers. Incumbent Local Exchange Carriers 68.7% Non-Traditional Providers 10.9% Wireless Providers 10.5% Internet Service Providers 2.0% Competitive Local Exchange Carriers 5.1% Long Distance Providers 2.0% Other Providers 0.7% 19 - 6 Year High-Cost Loop Support Safety Net Additive Support Safety Valve Support High-Cost Model Support Long-Term Support Interstate Common Line Support Interstate Access Support Local Switching Support Total Support 1986 $56 - - - - - - - $56 1987 126 - - - - - - - 126 1988 183 - - - - - - - 183 1989 265 - - - $236 - - - 500 1990 339 - - - 263 - - - 602 1991 485 - - - 272 - - - 757 1992 609 - - - 306 - - - 915 1993 705 - - - 323 - - - 1,028 1994 725 - - - 347 - - - 1,072 1995 750 - - - 382 - - - 1,132 1996 763 - - - 426 - - - 1,188 1997 794 - - - 470 - - - 1,263 1998 827 - - - 473 - - $390 1,690 1999 864 - - - 473 - - 380 1,718 2000 874 - - $219 478 - $279 385 2,235 2001 927 - - 206 492 - 577 390 2,592 2002 1,045 - - 233 493 $173 615 376 2,935 2003 1,085 $9 $0 234 504 409 622 396 3,259 2004 1,137 12 0 273 275 716 642 414 3,468 2005 1,219 15 4 292 0 1,178 691 425 3,824 2006* 1,284 20 2 332 - 1,231 657 467 3,993 Note: Detail may not appear to add to totals due to rounding. - Support mechanism did not exist in that year. Sources: National Exchange Carrier Association (1986-1997), Universal Service Administrative Company (1998-2005). Federal Universal Service Support Mechanisms Fund Size Projections for the Third Quarter 2006 (2006). Total High-Cost Support Fund Payments (In Millions of Dollars) Table 19.3 High-Cost Support Fund Payment History Chart 19.3 * Estimate for 2006 based on USAC projections. Payments will increase if additional carriers become eligible. $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 Millions of D o lla r s 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 19 - 7 High-Cost Loop Support Safety Net Additive Support Safety Valve Support High-Cost Model Support Long-Term Loop Support Interstate Common Line Support Interstate Access Support Local Switching Support Total Support Alabama $19,307 $243 $0 $45,790 -$1 $17,913 $20,214 $5,878 $109,343 Alaska 53,748 295 172 0 0 51,163 0 14,896 120,274 American Samoa 654 0 0 0 0 1,371 0 292 2,318 Arizona 33,039 147 44 0 0 11,891 19,353 10,077 74,550 Arkansas 70,409 372 0 0 0 43,782 17,419 9,015 140,997 California 36,639 204 0 0 0 22,618 34,362 5,043 98,866 Colorado 34,620 50 0 0 0 19,089 20,808 4,710 79,277 Connecticut 0 0 0 0 0 1,016 509 724 2,249 Delaware 0 0 0 0 0 0 259 0 259 District of Columbia 0 0 0 0 0 0 0 0 0 Florida 12,464 0 0 0 -23 10,614 64,278 4,118 91,450 Georgia 41,321 263 0 0 0 31,805 24,341 13,963 111,693 Guam 9,531 0 0 0 0 9,635 0 0 19,165 Hawaii 12,447 24 0 0 0 11,650 2,575 2,828 29,525 Idaho 22,917 199 0 0 0 9,136 16,101 6,702 55,055 Illinois 16,269 252 0 0 0 24,613 12,365 10,008 63,506 Indiana 9,641 283 0 0 0 13,294 23,840 9,574 56,632 Iowa 21,689 1,710 9 0 11 37,039 5,938 23,941 90,336 Kansas 98,695 642 0 0 15 53,970 7,572 17,790 178,684 Kentucky 23,658 4 0 16,997 0 19,387 18,294 5,260 83,600 Louisiana 61,342 172 0 0 0 30,876 12,369 6,483 111,241 Maine 7,297 0 0 2,044 21 12,265 232 6,953 28,812 Maryland 266 90 0 0 0 631 2,428 910 4,327 Massachusetts 214 38 0 0 0 523 1,889 970 3,634 Michigan 24,586 132 0 0 -71 19,140 558 9,230 53,575 Minnesota 36,743 2,646 0 0 17 45,914 5,115 22,917 113,352 Mississippi 27,269 265 0 146,627 0 12,347 18,537 4,206 209,251 Missouri 36,668 235 0 0 0 27,613 13,304 7,326 85,146 Montana 27,234 207 0 19,867 0 19,917 1,313 8,193 76,731 Nebraska 16,691 576 0 7,085 0 14,908 5,681 10,950 55,890 Nevada 6,366 201 0 0 0 5,873 10,579 6,620 29,639 New Hampshire 668 0 0 0 0 2,196 1,825 4,044 8,732 New Jersey 0 0 0 0 0 66 366 900 1,332 New Mexico 23,661 146 0 0 11 13,827 9,948 10,918 58,511 New York 8,027 858 0 0 0 8,870 19,289 14,788 51,833 North Carolina 11,896 0 0 0 0 25,490 36,959 5,834 80,179 North Dakota 21,313 115 0 0 2 24,319 836 16,133 62,718 Northern Mariana Islands 0 0 0 0 0 0 346 321 668 Ohio 9,130 445 0 0 0 9,550 14,791 3,839 37,754 Oklahoma 57,164 335 0 0 0 41,360 5,169 16,161 120,188 Oregon 22,620 173 0 0 -570 17,922 20,142 8,182 68,469 Pennsylvania 1,905 25 0 0 0 36,597 21,142 5,835 65,504 Puerto Rico 0 0 0 0 0 133,786 0 0 133,786 Rhode Island 0 0 0 0 0 0 44 0 44 South Carolina 25,967 1,029 0 0 0 31,292 13,276 4,759 76,322 South Dakota 31,587 601 13 2,455 1 28,274 146 14,711 77,788 Tennessee 14,694 -26 0 0 0 22,705 10,142 7,170 54,684 Texas 103,874 489 245 0 -101 66,702 39,592 19,215 230,017 Utah 7,372 35 89 0 0 9,509 2,531 4,044 23,579 Vermont 7,675 0 0 10,294 0 9,460 2,418 5,397 35,244 Virgin Islands 14,410 0 0 0 0 8,208 0 0 22,618 Virginia 3,697 -220 0 0 0 7,880 70,064 5,891 87,312 Washington 27,104 66 0 0 -24 24,311 34,446 8,483 94,387 West Virginia 15,462 118 0 26,328 0 2,213 19,680 2,517 66,318 Wisconsin 33,768 1,558 3,806 0 497 61,839 369 28,387 130,225 Wyoming 15,167 167 0 14,353 0 11,972 7,248 7,692 56,598 Total $1,218,883 $15,164 $4,378 $291,840 -$217 $1,178,343 $691,000 $424,795 $3,824,186 Source: The data are derived from individual company payments reported on the USAC web site. Note : The reason some values are negative is that support amounts include prior period adjustments. Table 19.4 High-Cost Support Payments by State: 2005 (In Thousands of Dollars) 19 - 8 Table 19.5 ILECs CETCs Total 1996 $1,188 $0 $1,188 0.0 % 1997 1,263 0 1,263 0.0 1998 1,690 0 1,690 0.0 1999 1,717 1 1,718 0.0 2000 2,233 1 2,235 0.1 2001 2,575 17 2,592 0.7 2002 2,889 46 2,935 1.6 2003 3,129 130 3,259 4.0 2004 3,153 316 3,468 9.1 2005 3,186 639 3,824 16.7 2006* 3,173 820 3,993 20.5 Federal Universal Service Support Mechanisms Fund Size Projections for the Third Quarter 2006 (2006). High-Cost Support Received by Incumbent LECs and CETCs (In Millions of Dollars) Notes: ILECs is an abbreviation for incumbent local exchange carriers. CETCs is an abbreviation for competitive eligible telecommunications carriers. CETCs include both wireless and wireline carriers. Percent of High-Cost Support Received by CETCs Chart 19.4 Percent CETCs Sources: National Exchange Carrier Association (1996-1997). Universal Service Administrative Company (1998-2005). * Estimate for 2006 based on USAC projections. 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006* 19 - 9 ILECs 1 CETCs 2 Rural Carriers Non-Rural Carriers Total Alabama $97,679 $11,664 10.7 % $43,505 $65,838 60.2 % $109,343 Alaska 100,628 19,646 16.3 104,772 15,502 12.9 120,274 American Samoa 2,318 0 0.0 2,318 0 0.0 2,318 Arizona 61,805 12,746 17.1 58,227 16,324 21.9 74,550 Arkansas 103,476 37,521 26.6 113,504 27,493 19.5 140,997 California 98,674 191 0.2 66,930 31,936 32.3 98,866 Colorado 72,050 7,227 9.1 56,232 23,045 29.1 79,277 Connecticut 2,249 0 0.0 1,739 509 22.6 2,249 Delaware 259 0 0.0 0 259 100.0 259 District of Columbia 0 0 NA 0 0 NA 0 Florida 81,140 10,310 11.3 45,655 45,795 50.1 91,450 Georgia 102,638 9,055 8.1 87,325 24,368 21.8 111,693 Guam 11,427 7,738 40.4 15,754 3,411 17.8 19,165 Hawaii 17,568 11,956 40.5 21,595 7,929 26.9 29,525 Idaho 55,055 0 0.0 55,055 0 0.0 55,055 Illinois 63,505 1 0.0 52,921 10,585 16.7 63,506 Indiana 54,481 2,151 3.8 35,173 21,459 37.9 56,632 Iowa 55,619 34,717 38.4 72,705 17,631 19.5 90,336 Kansas 132,251 46,433 26.0 161,628 17,056 9.5 178,684 Kentucky 75,144 8,456 10.1 46,849 36,751 44.0 83,600 Louisiana 85,913 25,328 22.8 91,278 19,963 17.9 111,241 Maine 24,533 4,279 14.9 24,856 3,956 13.7 28,812 Maryland 4,327 0 0.0 1,898 2,428 56.1 4,327 Massachusetts 3,634 0 0.0 1,746 1,889 52.0 3,634 Michigan 43,744 9,830 18.3 49,222 4,353 8.1 53,575 Minnesota 81,420 31,932 28.2 99,396 13,956 12.3 113,352 Mississippi 147,106 62,144 29.7 41,581 167,669 80.1 209,251 Missouri 85,026 120 0.1 78,646 6,499 7.6 85,146 Montana 72,678 4,053 5.3 55,826 20,905 27.2 76,731 Nebraska 54,422 1,468 2.6 44,881 11,008 19.7 55,890 Nevada 24,451 5,188 17.5 20,902 8,737 29.5 29,639 New Hampshire 8,732 0 0.0 6,907 1,825 20.9 8,732 New Jersey 1,332 0 0.0 1,332 0 0.0 1,332 New Mexico 49,491 9,020 15.4 51,258 7,253 12.4 58,511 New York 47,160 4,672 9.0 39,878 11,954 23.1 51,833 North Carolina 72,921 7,258 9.1 47,488 32,692 40.8 80,179 North Dakota 36,413 26,305 41.9 50,866 11,852 18.9 62,718 Northern Mariana Islands 437 231 34.6 621 47 7.1 668 Ohio 37,754 0 0.0 29,915 7,839 20.8 37,754 Oklahoma 108,602 11,586 9.6 113,088 7,101 5.9 120,188 Oregon 64,914 3,554 5.2 49,498 18,971 27.7 68,469 Pennsylvania 63,460 2,044 3.1 55,623 9,881 15.1 65,504 Puerto Rico 66,047 67,738 50.6 0 133,786 100.0 133,786 Rhode Island 44 0 0.0 0 44 100.0 44 South Carolina 76,322 0 0.0 65,577 10,745 14.1 76,322 South Dakota 54,108 23,679 30.4 66,491 11,297 14.5 77,788 Tennessee 53,510 1,174 2.1 46,844 7,840 14.3 54,684 Texas 226,231 3,786 1.6 204,533 25,484 11.1 230,017 Utah 23,302 278 1.2 22,130 1,449 6.1 23,579 Vermont 28,418 6,826 19.4 20,552 14,692 41.7 35,244 Virgin Islands 22,618 0 0.0 22,618 0 0.0 22,618 Virginia 72,049 15,263 17.5 27,584 59,729 68.4 87,312 Washington 65,990 28,398 30.1 55,490 38,897 41.2 94,387 West Virginia 58,578 7,740 11.7 29,309 37,008 55.8 66,318 Wisconsin 90,079 40,146 30.8 111,862 18,363 14.1 130,225 Wyoming 41,936 14,662 25.9 32,343 24,255 42.9 56,598 Total $3,185,670 $638,516 16.7 % $2,703,927 $1,120,259 29.3 % $3,824,186 NA - Not Applicable 1 ILECs is an abbreviation for incumbent local exchange carriers. 2 CETCs is an abbreviation for competitive eligible telecommunications carriers. CETCs include both wireline and wireless carriers. Source: Universal Service Administrative Company. Table 19.6 High-Cost Support by Type of Carriers: 2005 (In Thousands of Dollars) Percent CETCs 2 Percent Non- Rural Carriers 19 - 10 Min. Max. Avg. Min. Max. Avg. Min. Max. Avg. Min. Max. Avg. Min. Max. Avg. Alabama $5.25 $8.25 $8.24 $0.00 $3.50 $3.48 $0.00 $1.75 $1.74 $5.25 $10.00 $9.99 $5.25 $13.50 $13.47 Alaska 6.50 8.25 8.12 0.00 3.50 3.23 0.00 1.75 1.62 6.50 10.00 9.73 6.50 13.50 12.97 American Samoa 8.25 8.25 8.25 0.00 0.00 0.00 0.00 0.00 0.00 8.25 8.25 8.25 8.25 8.25 8.25 Arizona 8.05 8.25 8.20 0.00 3.50 2.76 0.00 1.75 1.38 8.05 10.00 9.58 8.05 13.50 12.34 Arkansas 5.25 8.25 7.47 0.00 3.50 0.71 0.00 1.75 0.35 5.25 10.00 7.82 5.25 13.50 8.53 California 3.97 8.25 6.63 0.00 3.50 2.46 0.00 1.75 1.23 3.97 10.00 7.85 3.97 13.50 10.31 Colorado 8.25 8.25 8.25 0.00 3.50 3.49 0.00 1.75 1.75 8.25 10.00 10.00 8.25 13.50 13.49 Connecticut 6.10 7.46 7.46 1.18 1.18 1.18 0.59 0.59 0.59 6.69 8.05 8.05 7.87 9.23 9.23 Delaware 8.17 8.17 8.17 0.00 0.00 0.00 0.00 0.00 0.00 8.17 8.17 8.17 8.17 8.17 8.17 District of Columbia 5.59 5.59 5.59 3.50 3.50 3.50 1.75 1.75 1.75 7.34 7.34 7.34 10.84 10.84 10.84 Florida 8.20 8.25 8.24 3.04 3.50 3.50 1.52 1.75 1.75 9.72 10.00 9.99 12.76 13.50 13.49 Georgia 3.50 8.25 8.25 0.00 3.50 3.38 0.00 1.75 1.69 3.50 10.00 9.94 3.50 13.50 13.32 Guam 8.25 8.25 8.25 3.50 3.50 3.50 1.75 1.75 1.75 10.00 10.00 10.00 13.50 13.50 13.50 Hawaii 8.25 8.25 8.25 0.00 0.00 0.00 0.00 0.00 0.00 8.25 8.25 8.25 8.25 8.25 8.25 Idaho 6.50 8.25 8.14 0.00 3.50 3.49 0.00 1.75 1.75 6.50 10.00 9.89 6.50 13.50 13.38 Illinois 6.24 8.25 6.65 0.00 0.00 0.00 0.00 0.00 0.00 6.24 8.25 6.65 6.24 8.25 6.65 Indiana 6.75 8.25 7.51 0.00 0.00 0.00 0.00 0.00 0.00 6.75 8.25 7.51 6.75 8.25 7.51 Iowa 5.25 8.25 7.25 0.00 3.50 0.01 0.00 1.75 0.00 5.25 10.00 7.25 5.25 13.50 7.26 Kansas 6.96 8.25 7.31 3.38 3.50 3.50 1.69 1.75 1.75 8.65 10.00 9.06 12.03 13.50 12.56 Kentucky 7.12 8.25 8.12 0.00 3.50 2.34 0.00 1.75 1.17 7.12 10.00 9.29 7.12 13.50 11.63 Louisiana 8.25 8.25 8.25 0.00 3.50 0.00 0.00 1.75 0.00 8.25 10.00 8.25 8.25 13.50 8.25 Maine 6.50 8.25 8.15 0.00 3.50 3.50 0.00 1.75 1.75 6.50 10.00 9.90 6.50 13.50 13.40 Maryland 7.42 8.25 7.42 0.84 3.50 3.50 0.42 1.75 1.75 7.84 10.00 9.17 8.68 13.50 12.67 Massachusetts 8.13 8.25 8.13 3.50 3.50 3.50 1.75 1.75 1.75 9.88 10.00 9.88 13.38 13.50 13.38 Michigan 7.09 8.25 7.29 0.00 3.50 1.99 0.00 1.75 0.99 7.09 10.00 8.28 7.09 13.50 10.27 Minnesota 6.65 8.25 7.15 0.00 3.50 1.54 0.00 1.75 0.77 6.65 10.00 7.92 6.65 13.50 9.46 Mississippi 8.25 8.25 8.25 0.00 3.50 3.35 0.00 1.75 1.67 8.25 10.00 9.92 8.25 13.50 13.27 Missouri 6.50 8.25 8.04 0.00 1.16 0.77 0.00 0.58 0.39 6.50 8.83 8.43 6.50 9.99 9.20 Montana 8.23 8.25 8.24 0.00 3.50 2.93 0.00 1.75 1.47 8.23 10.00 9.70 8.23 13.50 12.64 Nebraska 6.17 8.25 7.05 0.00 3.50 3.44 0.00 1.75 1.72 6.17 10.00 8.77 6.17 13.50 12.21 Nevada 5.55 8.25 6.15 0.00 3.50 2.95 0.00 1.75 1.47 5.55 10.00 7.63 5.55 13.50 10.57 New Hampshire 8.13 8.25 8.14 0.00 0.00 0.00 0.00 0.00 0.00 8.13 8.25 8.14 8.13 8.25 8.14 New Jersey 7.02 8.25 8.00 0.00 3.46 3.43 0.00 1.73 1.72 7.02 9.98 9.72 7.02 13.44 13.15 New Mexico 8.25 8.25 8.25 0.00 3.50 3.32 0.00 1.75 1.66 8.25 10.00 9.91 8.25 13.50 13.22 New York 6.17 8.25 8.02 0.00 3.50 3.22 0.00 1.75 1.61 6.17 10.00 9.63 6.17 13.50 12.86 North Carolina 7.41 8.25 7.92 0.00 3.50 3.49 0.00 1.75 1.75 7.41 10.00 9.67 7.41 13.50 13.16 North Dakota 1.75 8.25 8.24 0.00 3.50 1.84 0.00 1.75 0.92 1.75 10.00 9.17 1.75 13.50 11.01 N. Marianna Islands 8.25 8.25 8.25 0.00 0.00 0.00 0.00 0.00 0.00 8.25 8.25 8.25 8.25 8.25 8.25 Ohio 7.12 8.25 7.35 0.00 3.50 3.31 0.00 1.75 1.65 7.12 10.00 9.01 7.12 13.50 12.31 Oklahoma 6.96 8.25 7.18 0.00 3.50 0.55 0.00 1.75 0.28 6.96 10.00 7.45 6.96 13.50 8.01 Oregon 7.75 8.25 8.24 0.00 3.50 3.47 0.00 1.75 1.74 7.75 10.00 9.97 7.75 13.50 13.45 Pennsylvania 5.44 8.25 7.80 0.00 0.00 0.94 0.00 0.00 0.47 5.44 8.25 8.27 5.44 8.25 9.21 Puerto Rico 8.25 8.25 8.25 3.36 3.50 3.37 1.68 1.75 1.68 9.93 10.00 9.93 13.29 13.50 13.30 Rhode Island 8.13 8.19 8.13 0.00 3.50 3.38 0.00 1.75 1.69 8.13 9.94 9.82 8.13 13.44 13.20 South Carolina 6.97 8.25 8.22 0.00 3.50 3.49 0.00 1.75 1.74 6.97 10.00 9.97 6.97 13.50 13.45 South Dakota 6.50 8.25 8.20 0.00 1.76 0.03 0.00 0.88 0.01 6.50 9.13 8.22 6.50 10.89 8.25 Tennessee 6.82 8.25 8.12 0.00 3.50 3.12 0.00 1.75 1.56 6.82 10.00 9.68 6.82 13.50 12.79 Texas 5.25 8.25 7.15 0.00 3.50 3.42 0.00 1.75 1.71 5.25 10.00 8.87 5.25 13.50 12.29 Utah 8.08 8.25 8.10 0.00 3.50 3.50 0.00 1.75 1.75 8.08 10.00 9.85 8.08 13.50 13.35 Vermont 8.13 8.25 8.16 0.00 3.50 3.50 0.00 1.75 1.75 8.13 10.00 9.91 8.13 13.50 13.41 Virgin Islands 8.25 8.25 8.25 3.50 3.50 3.50 1.75 1.75 1.75 10.00 10.00 10.00 13.50 13.50 13.50 Virginia 6.62 8.25 7.47 1.76 3.50 3.26 0.88 1.75 1.63 7.50 10.00 9.10 9.26 13.50 12.35 Washington 6.97 8.25 7.82 0.00 3.50 1.92 0.00 1.75 0.96 6.97 10.00 8.78 6.97 13.50 10.70 West Virginia 8.25 8.25 8.25 0.00 3.50 2.75 0.00 1.75 1.37 8.25 10.00 9.62 8.25 13.50 12.37 Wisconsin 6.81 8.25 7.25 0.00 3.50 1.23 0.00 1.75 0.61 6.81 10.00 7.86 6.81 13.50 9.08 Wyoming 8.16 8.25 8.20 3.32 3.50 3.40 1.66 1.75 1.70 9.82 10.00 9.90 13.14 13.50 13.30 Nationwide $1.75 $8.25 $7.23 $0.00 $3.50 $2.59 $0.00 $1.75 $1.29 $1.75 $10.00 $8.52 $1.75 $13.50 $11.10 Notes: This table reflects only non-tribal support. All averages are weighted averages. 1 Basic federal support includes both Tier 1 and Tier 2 support. See text for definitions. 2 Includes only state support that is matched by federal support. Source: Universal Service Administrative Company. Table 19.7 Lifeline Monthly Support by State or Jurisdiction (As of March 31, 2005) Basic Federal Support 1 Total Federal and State Support 2 Total Federal Additional State Support 2 Support Federal Match 19 - 11 Table 19.8 Lifeline Subscribers and Link-Up Beneficiaries Year Non-Tribal Tribal Total Non-Tribal Tribal Total 1987 1,063,443 7,953 1988 1,828,862 105,758 1989 2,115,288 206,656 1990 2,466,513 513,155 1991 2,984,290 639,645 1992 3,440,216 743,285 1993 3,971,937 737,362 1994 4,423,119 837,964 1995 4,914,056 823,679 1996 5,233,425 808,354 1997 1 5,110,537 NA 1998 5,380,726 2,195,417 1999 5,640,094 1,834,766 2000 5,871,619 18,692 5,890,311 1,689,867 2,038 1,691,905 2001 6,144,089 56,820 6,200,909 1,670,260 23,355 1,693,615 2002 6,518,367 112,191 6,630,558 1,656,768 29,901 1,686,669 2003 6,490,614 147,203 6,637,817 1,653,301 22,289 1,675,590 2004 6,792,695 176,390 6,969,085 1,669,888 41,034 1,710,922 2005 2 6,883,048 236,458 7,119,506 1,653,101 86,857 1,739,958 NA - Not Available. 1 Subscriber data were not collected in 1997. Lifeline subscribership data were estimated by USAC. Source: Universal Service Administrative Company. Lifeline Link-Up 2 The reported subscribers and beneficiaries represent USAC data for the time period January 2005 through December 2005, which include true-ups for Lifeline subscribers and Link-Up beneficiaries through March 2006. 19 - 12 Non-Tribal Tribal Total Non-Tribal Tribal Total Alabama 26,948 7 26,955 1,670 0 1,670 Alaska 1,891 23,906 25,797 0 17,725 17,725 American Samoa 594 0 594 37 0 37 Arizona 28,810 45,006 73,816 3,748 7,871 11,619 Arkansas 23,629 1 23,630 6,306 0 6,306 California 3,103,682 435 3,104,117 956,578 9 956,587 Colorado 29,291 8 29,299 710 0 710 Connecticut 53,459 0 53,459 4,709 0 4,709 Delaware 2,587 0 2,587 478 0 478 District of Columbia 10,675 0 10,675 435 0 435 Florida 151,332 1 151,333 13,409 0 13,409 Georgia 69,005 0 69,005 8,671 0 8,671 Guam 3,513 0 3,513 945 0 945 Hawaii 6,882 0 6,882 548 0 548 Idaho 31,756 290 32,046 1,511 10 1,521 Illinois 107,187 0 107,187 49,996 0 49,996 Indiana 56,461 0 56,461 25,100 0 25,100 Iowa 61,184 3 61,187 20,635 0 20,635 Kansas 27,542 25 27,567 3,859 0 3,859 Kentucky 64,751 0 64,751 11,101 0 11,101 Louisiana 22,193 2 22,195 2,594 0 2,594 Maine 70,555 402 70,957 16,383 27 16,410 Maryland 4,561 0 4,561 851 0 851 Massachusetts 119,899 2 119,901 1,289 0 1,289 Michigan 109,711 263 109,974 21,309 34 21,343 Minnesota 59,965 921 60,886 8,095 185 8,280 Mississippi 28,488 2 28,490 4,132 4 4,136 Missouri 49,498 10 49,508 9,931 0 9,931 Montana 11,455 4,045 15,500 836 1,299 2,135 Nebraska 21,460 281 21,741 2,360 27 2,387 Nevada 43,146 165 43,311 6,925 1 6,926 New Hampshire 6,449 0 6,449 147 0 147 New Jersey 128,151 0 128,151 2,777 0 2,777 New Mexico 49,748 12,322 62,070 4,569 5,934 10,503 New York 427,148 20 427,168 34,246 0 34,246 North Carolina 124,161 5 124,166 5,571 0 5,571 North Dakota 15,650 6,085 21,735 3,150 1,753 4,903 Northern Mariana Islands 760 0 760 1,477 0 1,477 Ohio 313,460 0 313,460 54,012 0 54,012 Oklahoma 13,413 117,435 130,848 16,605 39,138 55,743 Oregon 54,328 392 54,720 21,998 423 22,421 Pennsylvania 160,408 0 160,408 32,233 0 32,233 Puerto Rico 108,022 0 108,022 15,320 0 15,320 Rhode Island 38,836 0 38,836 206 0 206 South Carolina 23,745 9 23,754 2,968 0 2,968 South Dakota 12,631 15,354 27,985 6,163 7,520 13,683 Tennessee 53,284 0 53,284 4,332 0 4,332 Texas 652,013 593 652,606 123,746 0 123,746 Utah 22,970 295 23,265 2,175 95 2,270 Vermont 24,283 0 24,283 1,292 0 1,292 Virgin Islands 368 0 368 34 0 34 Virginia 20,150 0 20,150 2,311 0 2,311 Washington 132,461 7,495 139,956 94,273 4,322 98,595 West Virginia 5,781 2 5,783 985 0 985 Wisconsin 85,146 218 85,364 30,303 198 30,501 Wyoming 7,572 458 8,030 7,057 282 7,339 Industry Totals 6,883,048 236,458 7,119,506 1,653,101 86,857 1,739,958 Source: Universal Service Administrative Company. The reported subscribers and beneficiaries represent USAC data for the time period January 2005 through December 2005, which include true-ups for Lifeline subscribers and Link-Up beneficiaries through March 2006. Table 19.9 Lifeline Subscribers and Link-Up Beneficiaries by State: 2005 Lifeline Link-Up 19 - 13 Table 19.10 Low-Income Support Payments Total Year Non-Tribal Tribal TLS 1 PICCs 2 Total Non-Tribal Tribal Total 1988 $31,952 $0 $0 $0 $31,952 $1,991 $0 $1,991 $33,943 1989 50,878 0 0 0 50,878 4,480 0 4,480 55,358 1990 62,464 0 0 0 62,464 11,351 0 11,351 73,815 1991 79,104 0 0 0 79,104 13,705 0 13,705 92,809 1992 93,766 0 0 0 93,766 15,342 0 15,342 109,108 1993 109,083 0 0 0 109,083 17,019 0 17,019 126,102 1994 123,284 0 0 0 123,284 18,573 0 18,573 141,857 1995 137,277 0 0 0 137,277 18,392 0 18,392 155,670 1996 148,186 0 0 0 148,186 18,247 0 18,247 166,433 1997 147,579 0 0 0 147,579 13,711 0 13,711 161,290 1998 416,504 0 2,700 2,802 422,006 42,463 0 42,463 464,469 1999 438,576 0 3,136 4,450 446,162 33,991 0 33,991 480,153 2000 482,045 508 2,854 3,168 488,575 30,371 62 30,433 519,007 2001 548,421 6,960 3,195 0 558,576 30,314 480 30,794 589,370 2002 623,352 17,955 3,780 0 645,087 30,323 707 31,031 676,117 2003 657,099 24,167 4,428 0 685,694 30,171 526 30,697 716,391 2004 695,217 30,503 5,114 0 730,835 30,904 1,239 32,142 762,977 2005 717,720 45,642 6,220 0 769,583 31,741 2,558 34,299 803,882 1 TLS is an abbreviation for toll limitation service. 2 Carriers no longer charge residential Presubscribed Interexchange Access Charges (PICCs) as of July 1, 2000. Source: Universal Service Administrative Company. (In Thousands of Dollars) Lifeline Link-Up Lifeline and Link-Up Support Payments Chart 19.5 Note: Support payments reported in this table include all low income support disbursed based on commitments for a given year, including all true- ups through March 2006. Support payments reported for 2005 in Tables 19.2, 19.3 and 19.12 report disbursements for 2005, regardless of the year of the commitments. $0.0 $100.0 $200.0 $300.0 $400.0 $500.0 $600.0 $700.0 $800.0 $900.0 Millio n s o f Do lla rs Lifeline Payments $32 $51 $62 $79 $94 $109 $123 $137 $148 $148 $422 $446 $489 $559 $645 $686 $731 $770 Link-Up Payments $2 $4 $11 $14 $15 $17 $19 $18 $18 $14 $42 $34 $30 $31 $31 $31 $32 $34 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 19 - 14 (In Thousands of Dollars) Lifeline Link-Up Total Non-Tribal Tribal TLS Total Non-Tribal Tribal Total Alabama $3,192 $0 $6 $3,198 $30 $0 $30 $3,229 Alaska 3,283 3,715 43 7,041 0 332 332 7,373 American Samoa 59 0 0 59 1 0 1 60 Arizona 8,502 11,753 67 20,322 87 156 243 20,565 Arkansas 2,212 0 4 2,216 129 0 129 2,345 California 284,118 28 3,079 287,225 17,295 0 17,295 304,520 Colorado 3,500 1 9 3,510 12 0 12 3,523 Connecticut 5,170 0 4 5,174 141 0 141 5,315 Delaware 254 0 0 254 7 0 7 261 District of Columbia 941 0 0 941 5 0 5 945 Florida 17,466 0 30 17,496 316 0 316 17,812 Georgia 8,167 0 28 8,195 211 0 211 8,405 Guam 422 0 0 422 17 0 17 438 Hawaii 680 0 1 681 12 0 12 693 Idaho 3,817 59 16 3,892 23 0 23 3,916 Illinois 8,563 0 1 8,564 1,080 0 1,080 9,644 Indiana 5,103 0 2 5,105 602 0 602 5,707 Iowa 5,366 1 252 5,619 462 0 462 6,081 Kansas 3,006 2 46 3,054 68 0 68 3,122 Kentucky 7,197 0 97 7,295 238 0 238 7,532 Louisiana 2,054 0 3 2,058 52 0 52 2,110 Maine 8,414 33 14 8,461 358 1 359 8,820 Maryland 502 0 0 502 20 0 20 522 Massachusetts 14,226 0 1 14,227 9 0 9 14,236 Michigan 10,925 48 8 10,982 437 0 437 11,419 Minnesota 5,671 108 71 5,850 152 4 156 6,006 Mississippi 3,309 1 4 3,314 93 0 93 3,407 Missouri 5,099 0 132 5,231 178 0 178 5,409 Montana 1,795 784 17 2,596 11 21 32 2,628 Nebraska 2,321 50 7 2,378 36 1 37 2,414 Nevada 3,964 12 15 3,990 117 0 117 4,107 New Hampshire 631 0 0 631 3 0 3 634 New Jersey 14,956 0 3 14,959 59 0 59 15,018 New Mexico 7,393 3,018 36 10,447 78 115 193 10,640 New York 49,244 2 16 49,262 881 0 881 50,143 North Carolina 14,375 1 28 14,403 118 0 118 14,522 North Dakota 2,352 1,300 17 3,669 57 91 148 3,817 Northern Mariana Islands 75 0 0 75 9 0 9 84 Ohio 33,868 0 38 33,906 930 0 930 34,837 Oklahoma 11,964 18,550 215 30,728 363 1,177 1,540 32,268 Oregon 6,563 72 346 6,981 336 40 376 7,357 Pennsylvania 15,762 0 0 15,762 947 0 947 16,709 Puerto Rico 12,875 0 0 12,875 372 0 372 13,247 Rhode Island 4,571 0 2 4,573 3 0 3 4,576 South Carolina 2,795 1 16 2,812 53 0 53 2,865 South Dakota 2,658 3,816 61 6,535 121 470 591 7,125 Tennessee 6,064 0 9 6,073 77 0 77 6,150 Texas 69,872 14 149 70,035 2,365 0 2,365 72,400 Utah 2,754 35 25 2,814 30 2 32 2,846 Vermont 2,860 0 4 2,864 18 0 18 2,882 Virgin Islands 50 0 0 50 1 0 1 51 Virginia 2,219 0 2 2,221 55 0 55 2,276 Washington 14,852 2,094 1,138 18,083 1,727 118 1,845 19,929 West Virginia 667 0 1 668 18 0 18 687 Wisconsin 8,048 34 3 8,086 762 3 765 8,851 Wyoming 955 109 152 1,216 160 25 185 1,401 Industry Totals $717,720 $45,642 $6,220 $769,583 $31,741 $2,558 $34,299 $803,882 Source: Universal Service Administrative Company. Table 19.11 Low-Income Support Payments by State: 2005 Note: Support payments reported in this table include all low income support disbursed for January through December 2005, including true-ups through March 2006. It does not include true-ups for years prior to 2005. Support payments reported in Tables 19.2 and 19.3 include true-ups for prior years. 19 - 15 Table 19.12 ILECs CETCs Total 1996 $166 $0 $166 0.0 % 1997 161 0 161 0.0 1998 464 0 464 0.0 1999 480 0 480 0.0 2000 519 0 519 0.0 2001 587 2 589 0.3 2002 664 12 676 1.8 2003 692 25 716 3.5 2004 723 40 763 5.3 2005 737 71 809 8.8 Low-Income Support Received by ILECs and CETCs (In Millions of Dollars) Notes: ILECs is an abbreviation for incumbent local exchange carriers. CETCs is an abbreviation for competitive eligible telecommunications carriers. CETCs include both wireless and wireline carriers. Percent of Low-Income Support Received by CETCs Chart 19.6 Percent CETCs Source: Universal Service Administrative Company. 0.0% 1.0% 2.0% 3.0% 4.0% 5.0% 6.0% 7.0% 8.0% 9.0% 10.0% 1998 1999 2000 2001 2002 2003 2004 2005 19 - 16 Table 19.13 Schools and Libraries Funding by Type of Service (Funds Committed and Disbursed Through December 31, 2005) 1 Internal Connections Internet Access Telecommunications Totals Funds Funds Funds Funds Funds Funds Funds Funds Funding Period Committed Disbursed Committed Disbursed Committed Disbursed Committed Disbursed Jan-98 to Jun-99 $886,134,476 $797,866,786 $134,170,437 $94,912,607 $675,960,835 $507,781,656 $1,696,265,747 $1,400,561,050 Jul-99 to Jun-00 1,365,903,855 1,109,011,630 149,548,801 95,838,059 635,087,482 454,006,675 2,150,540,138 1,658,856,364 Jul-00 to Jun-01 1,136,768,097 1,035,011,680 219,141,763 135,103,250 719,009,102 480,394,213 2,074,918,962 1,650,509,143 Jul-01 to Jun-02 1,205,943,128 1,002,430,636 226,407,211 149,994,699 769,210,484 521,804,531 2,201,560,822 1,674,229,866 Jul-02 to Jun-03 1,116,620,674 766,598,469 248,606,163 172,014,250 852,828,167 592,804,382 2,218,055,003 1,531,417,101 Jul-03 to Jun-04 1,517,488,781 1,009,071,904 267,056,541 194,591,595 885,594,684 634,926,942 2,670,140,006 1,838,590,441 Jul-04 to Jun-05 1,112,568,680 463,759,713 236,206,267 179,215,004 949,566,223 623,957,927 2,298,341,171 1,266,932,644 Jul-05 to Jun-06 500,183,649 45,123,606 246,326,299 85,796,939 886,541,911 144,084,604 1,633,051,858 275,005,149 1 Because of the appeals process, funding commitments and disbursements can be made after the program years' end. Source: USAC data. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau, FCC. Total Schools and Libraries Funds Committed and Disbursed Chart 19.7 $0.0 $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 A m ounts in B illions Funds Committed $1.7 $2.2 $2.1 $2.2 $2.2 $2.7 $2.3 Funds Disbursed $1.4 $1.7 $1.7 $1.7 $1.5 $1.8 $1.3 Jan-98 to Jun-99 Jul-99 to Jun-00 Jul-00 to Jun-01 Jul-01 to Jun-02 Jul-02 to Jun-03 Jul-03 to Jun-04 Jul-04 to Jun-05 19 - 17 Internal Connections Internet Access Telecom. and Dedicated Totals Funds Funds Funds Funds Funds Funds Funds Funds State/Territory Committed Disbursed Committed Disbursed Committed Disbursed Committed Disbursed Alabama $6,703,236 $4,327,378 $8,050,750 $7,611,414 $11,218,315 $8,891,527 $25,972,301 $20,830,318 Alaska 1,376,586 614,712 7,849,887 5,864,928 9,053,008 7,784,544 18,279,481 14,264,184 American Samoa 2,117,928 2,055,182 0 0 76,647 46,406 2,194,574 2,101,587 Arizona 34,643,093 15,156,542 7,966,946 6,086,312 14,622,260 9,020,286 57,232,298 30,263,140 Arkansas 2,329,767 1,090,735 537,082 155,817 15,273,926 10,969,730 18,140,776 12,216,282 California 136,654,341 63,224,587 16,320,504 10,058,281 113,120,900 54,782,953 266,095,745 128,065,821 Colorado 13,267,858 9,842,505 1,953,952 1,143,718 8,414,713 6,081,235 23,636,523 17,067,458 Connecticut 14,392,969 4,103,482 2,877,086 2,295,318 15,248,864 9,628,682 32,518,920 16,027,482 Delaware 0 0 46,832 29,024 414,880 346,546 461,712 375,570 District of Columbia 402,450 291,898 280,916 44,456 9,682,776 2,016,284 10,366,143 2,352,637 Florida 22,996,966 4,200,522 10,801,438 9,193,900 43,462,892 31,550,007 77,261,296 44,944,429 Georgia 31,810,232 14,988,827 6,552,086 4,942,533 29,596,453 23,220,850 67,958,772 43,152,210 Guam 3,965,495 2,723,337 409,948 408,408 1,351,205 672,088 5,726,648 3,803,833 Hawaii 181,246 88,020 496,305 226,058 2,514,788 1,225,169 3,192,339 1,539,247 Idaho 379,188 230,323 990,216 691,674 2,319,034 1,563,413 3,688,438 2,485,410 Illinois 68,588,208 9,263,600 2,405,428 1,534,229 32,895,356 22,246,076 103,888,992 33,043,905 Indiana 3,396,200 780,383 1,811,746 1,329,926 12,665,415 9,683,065 17,873,360 11,793,373 Iowa 203,114 102,148 1,802,878 1,377,289 12,153,233 8,391,018 14,159,225 9,870,455 Kansas 2,342,362 1,944,579 3,723,838 2,463,411 9,306,323 6,953,012 15,372,524 11,361,002 Kentucky 13,303,737 7,722,459 2,838,511 1,557,203 16,818,852 10,324,820 32,961,100 19,604,482 Louisiana 22,564,581 10,681,737 5,501,026 4,764,549 17,860,916 12,823,332 45,926,523 28,269,618 Maine 204,375 191,437 1,248,831 1,054,196 5,754,741 4,159,210 7,207,946 5,404,842 Maryland 5,438,207 1,702,270 1,426,520 892,082 17,411,748 6,879,911 24,276,474 9,474,263 Massachusetts 7,311,073 5,144,994 4,545,195 3,426,790 13,735,514 9,585,196 25,591,783 18,156,981 Michigan 15,354,270 7,279,737 7,544,456 6,043,905 27,241,416 13,872,306 50,140,142 27,195,948 Minnesota 4,145,814 3,527,993 4,555,356 3,117,550 13,620,675 10,380,611 22,321,845 17,026,155 Mississippi 19,959,356 12,398,310 1,862,769 1,494,272 21,507,301 14,432,866 43,329,427 28,325,449 Missouri 15,474,788 12,130,271 2,981,003 2,601,496 18,575,183 14,306,701 37,030,974 29,038,468 Montana 1,274,093 1,011,810 875,930 686,340 2,417,230 1,823,851 4,567,253 3,522,001 Nebraska 246,211 40,320 1,089,655 836,416 6,383,817 5,588,154 7,719,683 6,464,890 Nevada 925,444 36,000 250,404 209,854 2,861,988 2,449,279 4,037,835 2,695,134 New Hampshire 311,998 155,189 504,184 350,128 1,471,124 1,009,111 2,287,306 1,514,428 New Jersey 17,236,739 7,962,188 4,440,072 3,081,339 25,181,982 18,415,891 46,858,792 29,459,418 New Mexico 23,176,689 10,432,537 3,194,948 1,639,337 9,805,975 4,394,096 36,177,612 16,465,970 New York 240,378,886 75,230,635 12,328,626 7,911,619 101,883,373 59,660,962 354,590,886 142,803,216 North Carolina 12,205,755 6,737,352 11,014,222 9,478,478 19,951,059 16,218,583 43,171,035 32,434,413 North Dakota 724,854 512,968 222,832 218,397 3,258,396 2,918,364 4,206,082 3,649,728 Northern Mariana Islands 898,708 817,341 374,579 352,899 715,521 195,565 1,988,807 1,365,806 Ohio 15,226,307 6,540,042 15,342,411 13,700,841 33,925,204 28,159,618 64,493,922 48,400,500 Oklahoma 30,059,807 22,269,461 8,184,828 6,130,772 14,095,425 10,001,269 52,340,060 38,401,502 Oregon 1,520,659 1,142,341 3,244,905 2,280,571 10,327,079 7,364,304 15,092,642 10,787,217 Pennsylvania 33,920,266 20,109,504 10,196,842 8,437,429 33,973,461 25,978,115 78,090,569 54,525,048 Puerto Rico 470,690 58,464 1,310,182 543,810 668,239 167,475 2,449,110 769,749 Rhode Island 2,203,632 1,483,171 596,321 464,795 3,353,968 2,834,640 6,153,921 4,782,606 South Carolina 18,672,092 8,695,345 967,307 604,120 20,513,829 15,932,519 40,153,227 25,231,984 South Dakota 2,207,215 1,211,018 361,280 223,852 3,802,213 3,139,492 6,370,709 4,574,362 Tennessee 6,962,884 2,827,443 24,630,644 20,392,705 13,070,805 11,303,609 44,664,332 34,523,757 Texas 238,444,045 91,062,881 15,607,402 11,071,605 69,536,347 47,720,301 323,587,795 149,854,786 Utah 1,203,517 765,176 1,566,319 856,537 13,871,574 4,319,685 16,641,411 5,941,398 Vermont 5,767 3,560 502,161 357,731 1,180,650 820,556 1,688,579 1,181,846 Virgin Islands 3,964,972 1,476,812 1,940,323 1,371,822 659,077 591,952 6,564,372 3,440,586 Virginia 2,382,440 1,695,581 4,858,570 3,651,840 19,894,597 16,903,712 27,135,608 22,251,133 Washington 5,011,747 3,582,279 1,628,808 1,088,435 13,363,145 7,845,019 20,003,700 12,515,733 West Virginia 1,390,755 487,356 679,973 480,521 6,876,280 5,341,565 8,947,009 6,309,442 Wisconsin 1,924,927 1,501,583 2,866,429 2,345,374 19,861,462 10,564,808 24,652,817 14,411,765 Wyoming 110,141 103,390 44,607 38,697 745,068 457,588 899,816 599,675 Totals $1,112,568,680 $463,759,713 $236,206,267 $179,215,004 $949,566,223 $623,957,927 $2,298,341,171 $1,266,932,644 1 Because of the appeals process, funding commitments have been made after the program year ended on June 30, 2005. Source: USAC data. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau, FCC. Table 19.14 Schools and Libraries Funding by State and by Type of Service (Funding Period: July 1, 2004 Through June 30, 2005 Activity Through December 31, 2005) 1 19 - 18 Table 19.15 Rural Health Care Fund Disbursements by Service Speed (Activity Through December 31, 2005) 1 56 kbps to 200 kbps to 1.5 Mbps Funding Period 199 kbps 1.49 Mbps and Faster Total Jan-98 to Jun-99 $202,778 $880,375 $2,292,252 $0 $3,375,405 Jul-99 to Jun-00 452,992 1,073,816 2,719,619 58,132 4,304,559 Jul-00 to Jun-01 613,595 3,015,004 6,685,573 0 10,314,172 Jul-01 to Jun-02 319,539 8,110,537 10,125,267 0 18,555,343 Jul-02 to Jun-03 423,756 10,639,476 10,405,314 0 21,468,545 Jul-03 to Jun-04 469,172 10,913,686 13,076,176 7,559 24,466,593 Jul-04 to Jun-05 518,231 6,657,441 13,555,208 459,502 21,190,382 Jul-05 to Jun-06 862 1,905,766 2,048,694 48,869 4,004,191 1 Because of the appeals process, funding commitments and disbursements can be made after the program year's end. Voice Grade 2 Other Service Unknown 2 Broadband 2 or Speed Rural Health Care Fund Disbursements by Service Speed Source: USAC data. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau, FCC. 2 USAC data contain a short description of the services the health care providers receive. These service descriptions are rolled up into the categories above. Some inferences were made when service speed was not clearly indicated. For example, frame relay was assumed to be broadband in the range of 200 kbps to 1.5 Mbps, even though some frame relay service speeds may be faster. Chart 19.8 $0 $5 $10 $15 $20 $25 Amounts in Millions Broadband $3.2 $3.8 $9.7 $18.2 $21.0 $24.0 $20.2 Voice Grade and Other $0.2 $0.5 $0.6 $0.3 $0.4 $0.5 $1.0 Jan-98 to Jun-99 Jul-99 to Jun-00 Jul-00 to Jun-01 Jul-01 to Jun-02 Jul-02 to Jun-03 Jul-03 to Jun-04 Jul-04 to Jun-05 19 - 19 Table 19.16 Rural Health Care Fund Disbursements by Service Speed and by State (Funding Period: July 1, 2004 Through June 30, 2005 Activity Through December 31, 2005) 1 State Total Alabama $0 $724 $15,883 $0 $16,608 Alaska 1,325 5,172,752 6,326,628 43,993 11,544,698 American Samoa 0 0 0 0 0 Arizona 0 73,397 341,833 8,249 423,479 Arkansas 3,160 20,166 55,185 3,817 82,327 California 170,734 10,467 154,687 4,495 340,384 Colorado 16,168 0 105,280 0 121,448 Connecticut 0 0 0 0 0 Delaware 0 0 0 0 0 District of Columbia 0 0 0 0 0 Florida 0 4,380 150,830 0 155,210 Georgia 0 30,150 125,497 3,310 158,956 Guam 0 0 228,233 6,586 234,819 Hawaii 0 24,654 43,221 4,017 71,892 Idaho 0 10,013 269,109 31,931 311,054 Illinois 0 0 123,495 0 123,495 Indiana 22,266 19,410 125,639 5,900 173,215 Iowa 0 0 0 0 0 Kansas 11,461 19,685 189,453 5,251 225,850 Kentucky 0 244,245 484,179 98,136 826,560 Louisiana 0 0 0 0 0 Maine 21,565 6,189 2,802 894 31,450 Maryland 0 0 0 0 0 Massachusetts 0 0 0 0 0 Michigan 5,741 21,479 478,522 20,241 525,983 Minnesota 2,952 108,985 653,028 53,619 818,583 Mississippi 0 3,980 124,830 0 128,810 Missouri 0 6,768 70,141 8,419 85,329 Montana 0 33,072 459,794 1,279 494,145 Nebraska 0 45,704 673,568 14,671 733,942 Nevada 0 0 0 0 0 New Hampshire 0 0 2,483 0 2,483 New Jersey 0 0 0 0 0 New Mexico 0 41,346 64,379 2,248 107,972 New York 1,975 0 4,099 0 6,074 North Carolina 0 3,707 11,980 0 15,687 North Dakota 10,715 191,236 275,196 6,264 483,411 Northern Mariana Islands 0 0 0 0 0 Ohio 0 0 73,512 19,560 93,072 Oklahoma 0 58,868 10,640 0 69,508 Oregon 0 0 18,994 0 18,994 Pennsylvania 5,237 147 35,746 10,163 51,293 Puerto Rico 0 0 0 0 0 Rhode Island 0 0 0 0 0 South Carolina 0 23,990 14,538 0 38,528 South Dakota 4,859 27,827 409,676 662 443,024 Tennessee 0 37,029 14,905 940 52,874 Texas 0 0 2,532 2,095 4,628 Utah 0 120,497 283,471 522 404,490 Vermont 0 6,377 13,492 8,104 27,973 Virgin Islands 1,987 0 94,481 7,763 104,232 Virginia 0 118,384 176,968 1,882 297,235 Washington 0 0 43,113 350 43,463 West Virginia 4,095 12,457 51,243 677 68,473 Wisconsin 233,991 119,506 692,711 83,312 1,129,520 Wyoming 0 39,852 59,214 150 99,216 Totals $518,231 $6,657,441 $13,555,208 $459,502 $21,190,382 1 Because of the appeals process, funding commitments have been made after the program year ended on June 30, 2005. Source: USAC data. Rollups performed by the Industry Analysis and Technology Division staff, Wireline Competition Bureau, FCC Voice Grade 2 56 kbps to 2 USAC data contain a short description of the services the health care providers receive. These service descriptions are rolled up into the categories above. Some inferences were made when service speed was not clearly indicated. For example, frame relay was assumed to be broadband in the range of 200 kbps to 1.5 Mbps, even though some frame relay service speeds may be faster. Other Service Unknown 2 Broadband 2 200 kbps to 1.49 Mbps or Speed 1.5 Mbps 199 kbps and Faster 19 - 20 Year 1998 First Quarter 3.19 % 0.72 % Second Quarter 3.14 0.76 Third Quarter 3.14 0.75 Fourth Quarter 3.18 0.75 1999 First Quarter 3.18 0.58 Second Quarter 3.05 0.57 Third Quarter 2.94 0.99 Fourth Quarter 2.887 1.10 2000 First Quarter 5.8770 Second Quarter 5.7101 Third Quarter 5.5360 Fourth Quarter 5.6688 2001 First Quarter 6.6827 Second Quarter 6.8823 Third Quarter 6.8941 Fourth Quarter 6.9187 2002 First Quarter 6.8086 Second Quarter 7.2805 Third Quarter 3 7.2805 Fourth Quarter 7.2805 2003 First Quarter 7.2805 Second Quarter 4 9.1 Third Quarter 9.5 Fourth Quarter 9.2 2004 First Quarter 8.7 Second Quarter 8.7 Third Quarter 8.9 Fourth Quarter 8.9 2005 First Quarter 10.7 Second Quarter 11.1 Third Quarter 10.2 Fourth Quarter 10.2 2006 First Quarter 10.2 Second Quarter 10.9 Third Quarter 10.5 Fourth Quarter 9.1 2007 First Quarter 9.7 4 Beginning with the second quarter of 2003, carriers contribute based on projected, collected, end-user interstate and international telecom- munications revenues. Previously, carriers contributed based on historical, gross-billed revenues. The Commission also released an Order and Second Order on Reconsideration, which, inter alia, directed the Wireline Competition Bureau to announce the universal service contribution factor as a percentage rounded up to the nearest tenth of one percent. (See Federal Joint Board on Universal Service, 1998 Biennial Regu- latory Review - Streamlined Contributor Reporting Requirements Associated with Administration of Telecommunications Relay Service, North American Numbering Plan, Local Number Portability, and Universal Service Support Mechanisms, Telecommunications Services for Indivi- duals with Hearing and Speech Disabilities, and the Americans with Disabilities Act of 1990, Administration of the North American Numbering Plan and North American Numbering Plan Cost Recovery Contribution Factor and Fund Size, Number Resource Optimization, Telephone Number Portability, Truth-in-Billing and Billing Format, Order and Second Order on Reconsideration, CC Docket Nos. 96-45, 98-171, 90-571, 92-237, 99-200, 95-116, 98-170, FCC 03-58 (rel. March 14, 2003), at para. 22.) Source: Quarterly Public Notices on universal service contribution factors in CC Docket 96-45. 3 In the Schools First Report and Order, the Commission concluded that unused funds from the schools and libraries support mechanism would be applied to stabilize the collection requirement for universal service for the third and fourth quarters of 2002, and the first quarter of 2003, as necessary. (See Schools and Libraries Universal Service Support Mechanism, CC Docket No. 2-6, First Report and Order, 17 FCC Rcd 11521 (2002). 2 Consistent with the Eighth Report and Order, the Wireline Competition Bureau (formerly Common Carrier Bureau) issued a single universal service contribution factor for November and December 1999. Effective November 1, 1999, this single contribution factor superseded the fourth quarter 1999 contribution factors previously announced by the Bureau on September 10, 1999. See Proposed Fourth Quarter 1999 Universal Service Contribution Factors, CC Docket No. 96-45, Public Notice, DA 99-2109 (Com. Car. Bur., rel. Oct. 8, 1999); See Proposed Fourth Quarter 1999 Universal Service Contribution Factors, CC Docket No. 96-45, Public Notice, DA 99-1857 (Com. Car. Bur., rel. Sept. 10, 1999). Universal Service Fund Contribution Factors Table 19.17 Factors for Intrastate End-User Revenues 1 Quarter Factors for Interstate End-User Revenues 1 Initially, contributions for the schools and libraries and rural health care support mechanisms were based on interstate, international, and intrastate end-user telecommunications revenues, while contributions for high-cost and low-income support mechanisms were based on interstate and international end-user telecommunications revenues. See Federal-State Joint Board on Universal Service , CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776, 9200-05 (1997). Following a decision by the United States Court of Appeals for the Fifth Circuit, the Commission established a single contribution base for all universal service support mechanisms based on interstate and international revenues. See Federal- State Joint Board on Universal Service, Access Charge Reform , Sixteenth Order on Reconsideration and Eighth Report and Order in CC Docket No. 96-45 and Sixth Report and Order in CC Docket No. 96-262, 15 FCC Rcd 1679, 1685-86, para. 15 (1999) ( Eighth Report and Order). 19 - 21 Preliminary 1/ Q1 Service Provider Category 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Regional Bell Operating Companies (RBOCs) 11.7 % 14.4 % 14.3 % 16.2 % 18.3 % 19.9 % 19.9 % 19.8 % 20.6 % 20.0 % Including CLEC Affiliates. Incumbent Local Exchange Carriers (ILECs) 2.6 1.4 1.5 1.7 2.1 2.8 3.2 3.4 3.7 3.6 Other Than RBOCs Competitive Local Exchange Carriers (CLECs) Local Resellers and Other Local Carriers Other Than RBOCs 0.8 1.3 2.6 2.2 2.7 3.3 3.5 3.8 4.5 4.4 Total: Fixed Local Service Providers 15.1 17.1 18.5 20.1 23.1 26.0 26.6 27.0 28.9 28.0 Payphone Providers 0.0 0.1 0.1 0.1 0.1 0.0 0.0 0.0 0.1 0.1 Wireless Service Providers 3.3 5.1 6.6 9.2 12.0 17.2 24.8 27.8 27.7 32.3 RBOC Toll Service Providers 1.7 1.7 2.0 2.3 3.0 3.4 5.0 6.8 8.7 28.3 Other Toll Service Providers 79.9 76.0 72.9 68.3 61.9 53.3 43.6 38.5 34.7 11.3 81.6 77.7 74.9 70.6 64.9 56.7 48.6 45.2 43.4 39.6 Total All Filers 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 100.0 % 1 For years 1997 through 2002, the percentages are based on shares of reported subject interstate and international end-user billed revenues. The percentages shown for 2003 and 2004 are based on shares of reported subject interstate and international end-user collected revenues. Preliminary percentages shown for 2005 are based on FCC Form 499-Q filings. Preliminary percentages for the first quarter of 2006 are based on projected collected revenues for that quarter, from FCC Form 499-Q filings. Calculations exclude revenues for calls that both originate and terminate in foreign points. Calculations for years 1999 through 2003 include revenues for all filers. For the purposes of this table, AT&T and MC filings are classified as RBOC filings as of the first quarter of 2006. 2 Prior to 2004, the FCC Form 499-A asked each filer to identify a single category of communications business that best described its operations. T service provider categories listed on FCC Form 499-A correspond to traditional breakdowns of the industry. Starting in 2004, carriers were allowe to specify more than one category and were allowed to identify themselves as an All Distance service provider. Revenues from these filers have been categorized using the traditional industry classification that best described each company. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (March 2006). Chart 19.9 Share of Universal Service Contributions by Principal Type of Contributor Table 19.18 Share of Universal Service Contributions By Principal Type of Contributor Using Traditional Carrier Categories 1 2 Total: Toll Service Providers 1997 RBOC Toll Service Providers 1.7% Payphone Providers 0.0% RBOCs 11.7% Wireless Service Providers 3.3% Other Toll Service Providers 79.9% CLECs 0.8% Other ILECs 2.6% Preliminary First Quarter 2006 RBOC Toll Service Providers 28.3% Payphone Providers 0.1% RBOCs 20.0% Wireless Service Providers 32.3% Other Toll Service Providers 11.3% CLECs 4.4% Other ILECs 3.6% 19 - 22 20 - A 20 Appendix A – List of Publications by the Industry Analysis and Technology Division Most recent release dates are shown in parentheses: High-Speed Services for Internet Access: Status as of June 30, 2006 (January 2007). Infrastructure of the Local Operating Companies (October 2000). Updates can be found in Section 10 of the Monitoring Report. Local Telephone Competition: Status as of June 30, 2006 (January 2007). Universal Service Monitoring Report (December 2006). Numbering Resource Utilization in the United States (January 2007). Quality of Service Report of the Local Operating Companies (November 2005). Reference Book of Rates, Price Indices, and Household Expenditures for Telephone Service (August 2006). State-by-State Telephone Revenues and Universal Service Data (April 2001). Updates can be found in Section 1 of the Monitoring Report. Statistics of Communications Common Carriers, 2004/2005 Edition (November 2005). Statistics of the Long Distance Telecommunications Industry (May 2003). Telecommunications Industry Revenues: 2004 (March 2006). Telecommunications Provider Locator (March 2006). Telephone Penetration by Income by State (May 2006). Telephone Subscribership in the United States (January 2007). Telephone Subscribership on American Indian Reservations and Off-Reservations Trust Lands (May 2003). Trends in Telephone Service (June 2005). 21 - A 21 Appendix B – Sources of Telecommunications Information The information in this report and, in many cases, more detailed information can be downloaded from the Wireline Competition Bureau Statistical Reports web page at www.fcc.gov/wcb/stats. Printed copies of various statistical reports are available for reference in the FCC's Reference Information Center, Courtyard Level, 445 12th Street, S.W., and from the Commission's duplicating contractor, Best Copy and Printing, Inc., 800-378-3160. Additional information on regulated carriers, including investments, revenues, expenses, and earnings, is contained in the annual Statistics of Communications Common Carriers. The 2004/2005 edition can be found on the Wireline Competition Bureau Statistical Reports web page at www.fcc.gov/wcb/stats. Filings with the Securities and Exchange Commission, such as the annual reports on Form 10-K, can be downloaded from the Edgar Internet site at www.sec.gov. The names, addresses and telephone numbers for companies in the telephone industry are published in the Industry Analysis and Technology Division's Telecommunications Provider Locator, which can also be downloaded at www.fcc.gov/wcb/stats. The most recent report was released on March 2006. In April 2001, the Commission began requiring all new and existing telecommunications carriers providing interstate telecommunications services to register with the FCC using the FCC Form 499-A. Carriers file the form with the Commission’s data collection agent, the Universal Service Administrative Company. Copies of the form can be downloaded from the Internet at www.fcc.gov/formpage.html. Information on registered companies can be found on the Internet at http://gullfoss2.fcc.gov/cib/form499/499a.cfm. The information on personal consumption expenditures (Table 3.3) comes from the Bureau of Economic Analysis, National Economic Accounts, Table 2.4.5U. Personal Consumption Expenditures by Type of Product. See www.bea.gov/bea/dn/nipaweb/nipa_underlying/TableView.asp#Mid The information on consumer expenditures (Table 3.1), employment (Tables 5.1 and 5.2), and price indices (Tables 12.1 - 12.3) comes from the Bureau of Labor Statistics and can be found on the Internet at www.bls.gov. FCC rules require carriers to provide more detailed traffic data about international telephone service than about domestic service. Because of delays in international settlements, such information is typically received by the Commission much later than domestic data and is usually published separately. Tables 6.1 - 6.5 contain summary information on international telephone service. More detailed international data are available from International Telecommunications Data and Trends in the International Telecommunications Industry, both of 21 - B which are published by the International Bureau and are available at www.fcc.gov/wcb/stats. Tables 18.1and 18.2 on area codes come from the North American Numbering Plan Administration (NANPA), which is part of Neustar, Inc. Additional information on NANPA can be found on the Internet at www.nanpa.com. The information on wireless telephone service shown in Tables 11.1 and 11.3 was prepared from data received from CTIA-The Wireless Association TM 1600 16th Street N.W., Washington, D.C. 20036, 202-785-0081. CTIA can be found on the Internet at www.wow- com.com. TNS Telecoms (TNS) has donated databases to the Commission containing information on residential phone usage collected from actual consumer telecommunications bills. TNS has granted the Commission permission to use these databases for research purposes and to publish the industry level results. TNS has been monitoring the telecommunications market since 1995 through both the ReQuestฎ consumer survey and Bill Harvestingฎ in the residential market and the BusinessWaveฎ business survey in the business market. Tables 9.5, 9.6, and 14.1 - 14.6 are developed from these databases. For additional information, visit www.tnstelecoms.com or contact them at 1-866-811-TNST or by e-mail at contact@tnstelecoms.com. Their address is 101 Greenwood Avenue, Suite 502, Jenkintown, PA 19046. On September 9, 2004, the Commission released its Fourth Report to the Congress on the Availability of Advanced Telecommunications Capability in the United States. A copy of this can be found on the Commission’s web site at http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-208A1.pdf. A copy may also be obtained through from the Commission’s duplicating contractor. Copies of NTIA’s report A Nation Online: Entering the Broadband Age can be obtained through NTIA’s web site at www.ntia.doc.gov or by contacting NTIA’s Office of Public Affairs at (202) 482-7002. Tables 17.1, 17.2, and 17.4 contain information from the ARMIS 43-07 reports for the Bell operating companies. Table 17.3 contains information from the ARMIS 43-05. Individual carrier information can be obtained from the ARMIS web page at www.fcc.gov/wcb/armis. Chart 17.1 shows the number of patents granted for telecommunications. Additional information on U.S. patents can be found on the Internet at www.uspto.gov. The National Exchange Carrier Association (NECA) administers access charge revenue pooling for about 1,150 local telephone companies. Their headquarters is located at 80 South Jefferson Road, Whippany, NJ 07981-1009, and they can be reached at 800-228-8597. NECA’s website can be found on the Internet at www.neca.org. 21 - C The United States Telecom Association (USTA) (1401 H Street N.W., Washington, D.C. 20005, 202-326-7300) represents most incumbent local telephone companies. Like many trade associations, it collects information from each of its members. It publishes and sells various reports including an annual publication called Phone Facts. USTA’s website can be found on the Internet at www.usta.org. Comptel/ALTS was formed in March 2005 by the merger of Comptel/ASCENT and the Association for Local Telecommunications Services (ALTS) and is currently located at the former Comptel/ASCENT headquarters at 1900 M Street N.W., Suite 800, Washington, D.C. 20036, 202-296-6650). They represent facilities-based competitive telecommunications service providers, emerging VOIP providers, integrated communications companies, and their service partners, and can be found on the Internet at http://www.comptelascent.org. 22 - A 22 Appendix C – Contacting the Report Authors Trends in Telephone Service was prepared by the Industry Analysis and Technology Division, Wireline Competition Bureau, Federal Communications Commission. Principal authors of the report can be contacted at their electronic mail addresses or by calling the Industry Analysis and Technology Division at 202-418-0940. Users of TTY equipment should call 202- 418-0484. Access Charges ..................................................................................................... Pedro Almoguera Advanced Telecommunications..........................................................James Eisner or Ellen Burton Consumer Expenditures....................................................................................................Jim Lande Earnings ................................................................................................................. Stephen Steckler Employment and Labor Productivity........................................................................Kenneth Lynch International Telephone Service .......................................................................................Jim Lande Lines and Payphones......................................................................Alex Belinfante or James Eisner Local Telephone Competition.............................................................James Eisner or Ellen Burton Long Distance Telephone Industry...............................................................................James Eisner Minutes .................................................................................................................... Alex Belinfante Mobile Wireless Service...............................................................................................James Eisner Price Indices for Telephone Service ..................................................................... Pedro Almoguera Price Levels........................................................................................................... Pedro Almoguera Residential Telephone Usage......................................................... Kenneth Lynch or James Eisner Revenues...........................................................................................................................Jim Lande Subscribership.......................................................................................................... Alex Belinfante Technology and Infrastructure........................................Jonathan Kraushaar or Michael Goldstein Telephone Numbers and Area Codes ...........................................................................Craig Stroup Universal Service - High Cost .......................................................James Eisner or Alex Belinfante Universal Service – Lifeline/Link-Up .........................................Suzanne Mendez or Larry Povich Universal Service – Rural Health Care.........................................................................Craig Stroup Universal Service – Schools and Libraries ...................................................................Craig Stroup Electronic mail addresses are: Alex Belinfante .........................................................................................Alex.Belinfante@fcc.gov Ellen Burton.................................................................................................. Ellen.Burton@fcc.gov James Eisner..................................................................................................James.Eisner@fcc.gov Michael Goldstein................................................................................ Michael.Goldstein@fcc.gov Jonathan Kraushaar............................................................................ Jonathan.Kraushaar@fcc.gov Jim Lande.......................................................................................................... Jim.Lande@fcc.gov Kenneth Lynch.......................................................................................... Kenneth.Lynch@fcc.gov Suzanne Mendez .....................................................................................Suzanne.Mendez@fcc.gov Larry Povich..................................................................................................Larry.Povich@fcc.gov Craig Stroup.................................................................................................. Craig.Stroup@fcc.gov Customer Response Publication: Trends in Telephone Service – February 2007 You can help us provide the best possible information to the public by completing this form and returning it to the Industry Analysis and Technology Division of the FCC's Wireline Competition Bureau. 1. Please check the category that best describes you: ____ press ____ current telecommunications carrier ____ potential telecommunications carrier ____ business customer evaluating vendors/service options ____ consultant, law firm, lobbyist ____ other business customer ____ academic/student ____ residential customer ____ FCC employee ____ other federal government employee ____ state or local government employee ____ Other (please specify) 2. Please rate the report: Excellent Good Satisfactory Poor No opinion Data accuracy (_) (_) (_) (_) (_) Data presentation (_) (_) (_) (_) (_) Timeliness of data (_) (_) (_) (_) (_) Completeness of data (_) (_) (_) (_) (_) Text clarity (_) (_) (_) (_) (_) Completeness of text (_) (_) (_) (_) (_) 3. Overall, how do you Excellent Good Satisfactory Poor No opinion rate this report? (_) (_) (_) (_) (_) 4. How can this report be improved? 5. May we contact you to discuss possible improvements? 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