1 - 1 1. Industry Revenues and Contributions This section provides a general overview of the revenues of the U.S. telecommunications industry, and the contributions to the universal service support mechanisms that are based on these revenues. 1 Most of the data for 2008 are taken from filings of annual Telecommunications Reporting Worksheets (FCC Form 499-A) made with the Universal Service Administrative Company (USAC) on April 1, 2009. 2 Revenue data collected on these worksheets are used to administer contributions to the Universal Service Fund (USF), Interstate Telecommunications Relay Service (TRS), North American Numbering Plan (NANP), and local number portability (LNP) programs. Filer revenues also are used to calculate FCC Interstate Telecommunications Service Provider (ITSP) regulatory fees. 3 Data presented for 2009 and 2010 are taken from FCC Form 499-Q quarterly filings. Revenue Information The Commission has established several universal service mechanisms, governed by Section 254 of the Telecommunications Act of 1996, that help ensure that all Americans have access to affordable telecommunications service. In Section 254(d) of the Telecommunications Act of 1996, 4 Congress mandated that "[e]very telecommunications carrier that provides interstate telecommunications services 1 Portions of this section are based on Industry Analysis and Technology Division, Wireline Competition Bureau, Federal Communications Commission, Telecommunications Industry Revenues (September 2010). 2 Telecommunications providers filed worksheets containing calendar year 2009 revenue data on April 1, 2010. The worksheets are filed with the FCC’s Data Collection Agent, which extensively reviews and validates data. Telecommunications providers routinely make revised filings. As a result, the data are not considered reliable enough for publication for several months after the initial filing date. Therefore, the 2010 filings were not available for use in this report and 2009 and 2010 data were based on the more abbreviated and less reliable FCC Form 499-Q quarterly filings. April 2009 FCC Form 499-A filings containing 2008 revenues were used to compile the 2008 data. Compilation was based on a database prepared by the Data Collection Agent as of December 7, 2009. Therefore, revised or new 2009 FCC Form 499-A filings that were received after December 7, 2009, are not reflected herein. 3 Much of the information filed on FCC Form 499-A is proprietary. Publicly available information on individual carriers is contained in Industry Analysis and Technology Division, Wireline Competition Bureau, Federal Communications Commission, Telecommunications Provider Locator (January 2010). See also Consumer and Governmental Affairs Bureau, Federal Communications Commission, Telecommunications Reporting Worksheet 499-A Search Form at fjallfoss.fcc.gov/cgb/form499/499a.cfm. 4 Pub. L. No. 104-104, 110 Stat. 56 codified at 47 U.S.C. §§ 151 et seq. 1 - 2 shall contribute, on an equitable and nondiscriminatory basis, to the specific, predictable, and sufficient mechanisms established by the Commission to preserve and advance universal service." 5 The Commission implemented this mandate in a 1997 Report and Order. 6 The Commission subsequently selected USAC as the universal service fund administrator. Telecommunications providers currently file FCC Form 499-A (Telecommunications Reporting Worksheets, due on April 1 of each year for the previous calendar year revenues) and FCC Form 499-Q (Telecommunications Reporting Worksheets, due one month after the close of each calendar quarter). Virtually all providers of telecommunications must file FCC Form 499-A each year. 7 On June 21, 2006, the Commission ruled that providers of interconnected Voice over Internet Protocol (VoIP) service also must file FCC Form 499-A. 8 These filers first provided whole year revenue information in 5 47 U.S.C. § 254(d). 6 See Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Report and Order, 12 FCC Rcd 8776 (1997) (subsequent history omitted). 7 There are certain exceptions. Providers that offer telecommunications for a fee exclusively on a non-common carrier basis are not required to file if their total annual contribution to universal service would be less than $10,000. Government entities that purchase telecommunications services in bulk on their own behalf, public safety and local government entities licensed under Subpart B of Part 90 of the Commission’s rules, and entities providing interstate telecommunications exclusively to government or public safety entities are not required to file. In addition, broadcasters, non-profit schools, non-profit libraries, non-profit colleges, non-profit universities and non-profit health care providers are not required to file. Finally, systems integrators that derive less than 5% of their systems integration revenues from the resale of telecommunications and entities that provide services only to themselves or to commonly owned affiliates need not file. However, services provided to exempt entities may be subject to contribution requirements and therefore exempt entities may be required to pay USF pass through charges to their underlying services providers. 8 See Universal Service Contribution Methodology; Federal-State Joint Board on Universal Service, 1998 Biennial Regulatory 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 Individuals 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, WC Docket No. 06-122, CC Docket Nos. 96-45, 98-171, 90-571, 92-237, 99-200, 95- 116, 98-170, Report and Order and Notice of Proposed Rulemaking and Report and Order, 21 FCC Rcd 7518 (2006) (2006 Contribution Methodology Reform Order). 1 - 3 their April 2008 FCC Form 499-A filings. Telecommunications Reporting Worksheets are not filed directly with the FCC but rather with USAC, which serves as the data collection agent. FCC Form 499-A asks each filer to report total (including intrastate), interstate, and international revenues in two broad categories: those billed to universal service contributors for resale (carrier's carrier revenues); and those billed to de minimis and other USF-exempt telecommunications providers and end users (end-user revenues). 9 Filers must provide further breakdowns of local, mobile wireless, and toll services. (Local and toll services include fixed wireless.) The form also asks each filer to choose the communications business that best describes its operations: 10 • Audio Bridge Service Provider • Competitive Access Provider (CAP) or Competitive Local Exchange Carrier (CLEC) • Cellular, Personal Communications Service (PCS) and Specialized Mobile Radio (SMR) Wireless Telephony Service Provider • Coaxial Cable • Incumbent Local Exchange Carrier (ILEC) • Interconnected VoIP • Interexchange Carrier (IXC) • Local Reseller • Operator Service Provider (OSP) • Other Local Service Provider • Other Mobile Service Provider • Other Toll Service Provider • Paging and Messaging Service Provider • Payphone Provider • Prepaid Calling Card Provider • Private Service Provider • Satellite Service Provider • Shared-Tenant Service Provider • Specialized Mobile Radio - Dispatch • Toll Reseller • Wireless Data Service Provider 9 Telecommunications providers are considered de minimis and thus are not required to contribute to universal service (or file Form 499-Q) if their annual contributions to universal service would be less than $10,000. For universal service contribution purposes, underlying service providers treat de minimis providers as end users. 10 The detailed definitions of the filer categories are contained in section III.A of the Instructions to the Telecommunications Reporting Worksheet, FCC Form 499-A available at www.fcc.gov/Forms/Form499-A/499a-2009.pdf. Starting in 2004, carriers were instructed to select up to 5 principal communications business types, ranked in order of importance. The 2004 through 2006 forms included a category for “All Distance” carriers. 1 - 4 The Form 499-A instructs filers to report amounts actually billed to customers. This means that filers are required to report revenues net of discounts, but without making adjustments to reflect uncollectible revenues or international settlement payments and receipts. Most filers are able to report revenues in this manner using information contained in their corporate books of account. Some service providers, however, have no business or regulatory requirements to record intrastate or international revenues separately from interstate revenues, or to use the detailed revenue categories contained in the worksheets. Wireless and interconnected VoIP providers may use the interim safe harbor percentages to estimate the interstate portion of their revenues. 11 Form 499-A filings sometimes contain inaccurate data. Initial examination of the data occasionally reveals provider types, revenue amounts and/or revenues reported in service categories inconsistent with the known operations of the filer. Some corrections have been made based on supplemental filer information or as a result of audits. Nonetheless, disaggregated data are likely to be less accurate than industry totals. Table 1.1 shows the major components of telecommunications revenues for 1999 through 2009. This table was created by aggregating revenue by major service classifications, i.e. local, mobile wireless, and toll, and separately by intrastate and interstate and international. Tables 1.2 and 1.3 provide a look at annual industry revenues over time. Generally, Form 499-A revenue data can be aggregated in two distinct ways: by type of service and by principal communications business. Table 1.2 categorizes revenues by type of service and shows, for example, that providers reported $124.5 billion in wireless service revenues for 2008. This total includes wireless service revenues from some providers that are not identified as wireless providers. In contrast, Table 1.3 shows that wireless service providers reported total revenues of $128.3 billion for 2008, including some revenues for fixed local and toll services. Revenue data for 1998 were derived by combining TRS worksheet and Universal Service worksheet data. Since 1999, revenue data came from Form 499-A, which replaced both the TRS and 11 See Instructions to the Telecommunications Reporting Worksheet, FCC Form 499-A Section III.C.3., available at http://www.fcc.gov/Forms/Form499-A/499a-2009.pdf. In 2001 and 2002, the interim safe harbor for wireless carriers was 15%. In December 2002, the Commission raised the wireless interim safe harbor to 28.5%. Wireless carriers began reporting revenues based on the higher interim safe harbor percent on the FCC Form 499-Q due on February 1, 2003, and began contributing on this basis in April 2003. In the 2006 Contribution Methodology Reform Order, the Commission raised the wireless interim safe harbor to 37.1%. Wireless carriers began reporting revenues based on this higher interim safe harbor percent in the FCC Form 499-Q due on August 1, 2006. The safe harbor for interconnected VoIP providers is 64.9%. 1 - 5 Universal Service worksheets. Because of reporting changes, data since 1999 are not entirely consistent with data for prior years. 12 Note also that each year, many filers erroneously report substantial amounts of switched toll revenues as other long distance revenues. The data are examined and some revenues are reclassified based on staff research. Even so, the other long distance category of Table 1.2 is likely to contain some switched toll revenues, perhaps significant amounts in some years. Table 1.4 illustrates how data from the Form 499-A are used to construct the funding base for the USF. 13 As noted above, providers are considered de minimis for USF purposes if their annual contribution is expected to be less than $10,000. Revenue data for individual filers are not available to the public. However, Tables 1.5 through 1.8 present detailed industry totals by type of service and type of business. Table 1.5 displays carrier’s carrier revenue by detailed service type including each Form 499-A revenue line items. Table 1.6 displays similar detail for each of the revenue categories used to report telecommunications service provided to end users. Table 1.7 combines data from Tables 1.5 and 1.6 with data on non- telecommunications revenues to obtain total industry revenues. Table 1.8 provides more aggregated revenue information by principal business type. The revenue categories presented in Tables 1.5 through 1.7 are explained in the Form 499-A filing instructions. Table 1.9 presents data from quarterly filings of Form 499-Q for 2008, 2009, and 2010. Form 499-Q is far less detailed than Form 499-A. Because Form 499-Q filings do not include a business type, 12 For example, special access revenues were included with other access revenues prior to 1997 but have been included with local private line services since then. Similarly, through 1996, filers reported as other local and mobile revenues substantial amounts of customer premises equipment, billing and collection, and other types of revenues that are excluded from contributions to universal service. These revenues are now reported as non-telecommunications revenues. The spreadsheet versions of both tables contain estimates of non-telecommunications revenues that had been reported in prior years. Based on staff estimates, the 1996 telecommunications revenues reported on TRS Worksheets would have been $10.5 billion lower if revenues had been reported using current instructions. Some inconsistencies existed in the 1997 - 1998 period. For example, filers were required in 1997 to include inside wiring maintenance revenues as part of local exchange revenues. In 1998, filers were instructed to report these revenues as non- telecommunications service revenues. The local exchange service revenue data in Table 1.2 would show a greater increase from 1997 to 1998 if the same reporting instructions had been used for each year. 13 See Telecommunications Industry Revenues 2008, available at http://www.fcc.gov/wcb/iatd/lec.html for a comparison with the funding bases used for TRS, NANP, and LNP. 1 - 6 filers were categorized based on the primary business type selected on their Form 499-A filings. The quarterly form asks filers to identify revenues as carrier’s carrier, contribution base end user, or non- telecommunications and to indicate the interstate and international shares of each category. Unlike Form 499-A, the quarterly form does not require filers to classify revenues by types of service. Also, international-to-international revenues are included with non-telecommunications revenues rather than with end user revenues on the quarterly form. 14 The universal service rules prohibit the fund administrator from releasing company-specific information contained in Form 499-A and Form 499-Q worksheets. 15 Revenue data for individual filers are not available to the public. Program Requirements and Contribution Factors Contributors make payments into the USF based on their interstate and international end user telecommunications revenues. Contributors report their revenue data to USAC, which collects the data, and reports it to the Commission. The Commission reviews program requirements and revenue data, and determines the appropriate contribution factor. The Commission’s Office of Managing Director releases a public notice stating the proposed contribution factor for the upcoming quarter. If, after 14 days, the Commission takes no action regarding the proposed contribution factor, the factor becomes final. 16 In February 2002, the Commission issued an order that, in relevant part, eliminated from the contribution base charges identified on customers’ bills as amounts recovering contributions to the universal service support mechanisms, i.e. USF pass through surcharges. This change was intended to prevent double assessment of the pass through surcharges, a situation known as “circularity.” 17 Prior to these changes, providers filed historic revenue information each quarter, including revenue derived from pass through surcharges, and the Commission would use these revenue totals along with total estimated program requirements to calculate the contribution factor. 18 In anticipation of this 14 Filers record international-to-international revenues for calls that they receive outside the United States and that they carry to points outside the United States where the filer is operating as a U.S. carrier. 15 47 C.F.R. §54.711(b). 16 47 C.F.R. §54.709(a)(3). 17 See Federal-State Joint Board on Universal Service, et al, CC Docket Nos. 96-45, 98-171, 90- 571, 92-237, 99-200, 95-116, 98-170, Further Notice of Proposed Rulemaking and Report and Order, 17 FCC Rcd 3752 (2002). 18 The Commission reduces the revenue estimates by 1% to account for uncollectibles. 1 - 7 double assessment, providers would frequently inflate their reported USF pass through surcharges (reported on Line 403) about the contribution factor. The elimination of circularity was implemented in the third quarter of 2002. It reduced each provider’s contribution base by the amount that the provider paid into USF during the prior quarter. The line item “Circularity Adjustment” in Table 1.10 accounts for this change. This eliminated circularity as a reason for providers to inflate pass through charges. In December 2002, the Commission adopted an order that changed the basis for contribution assessments from historic gross-billed revenues to projected collected revenues. 19 This change addressed the reason given by service providers with declining revenue for marking up their pass through charges. These service providers argued that they had to contribute based on historic amounts that were greater than their current period billings, resulting in the need to mark up their pass through charges. This change was fully implemented in the second quarter of 2003. Having addressed circularity and changing the contribution assessment methodology to address declining revenues, the two main reasons cited by providers for marking up their pass through charges, the Commission adopted a rule requiring those contributors that recover their universal service contributions through a universal service line item to limit their recovery to the interstate portion of the customer’s bill times the relevant contribution factor. 20 Form 499-Q filers now file information on billed revenues for the previous quarter and both projected billed revenues and projected collected revenues for the upcoming quarter. Projected collected revenues, which are projected billed revenues less an allowance for uncollectible revenues, form the basis for USF contribution assessments. Projected collected revenues are then adjusted to eliminate circularity. Starting with the second quarter of 2003, the "Circularity Adjustment" amounts shown in Table 1.10 (discussed in more detail below) reflect expected USF contributions for the quarter rather than the industry's actual contributions from a prior quarter. Table 1.10 shows the program funding requirements for 2009 and 2010. For each program and for each quarter, the table lists projected program demand, administrative costs, interest income, and periodic true-ups. The table also shows the revenue base and contribution factors for each quarter. As explained above, the contribution base is 1% less than reported revenues to reflect the fact that some contribution assessments may prove uncollectible. 19 See Federal-State Joint Board on Universal Service, et al, CC Docket Nos. 96-45, 98-171, 90- 571, 92-237, 99-200, 95-116, 98-170, Report and Order and Second Further Notice of Proposed Rulemaking, 17 FCC Rcd 24952 (2002). 20 47 C.F.R. §54.712. 1 - 8 Sprint Nextel Corporation and Cellco Partnership d/b/a Verizon Wireless, in separate transactions in 2008, each committed to surrender their high cost universal service support over five years. 21 The first installment of this voluntary commitment appears in the fourth quarter of 2009 of Table 1.10. Table 1.11 shows universal service disbursements on a mechanism-by-mechanism basis for 2008 and 2009. 22 Chart 1.1 shows the 2009 information graphically. Table 1.12 shows, on a state-by-state basis, the total amount of funding disbursements for each of the universal service mechanisms, estimated contributions towards universal service, and the net estimated dollar flow (disbursements less estimated contributions) for 2009. 23 21 See Applications of Cellco Partnership d/b/a Verizon Wireless and Atlantis Holdings LLC For Consent to Transfer Control of Licenses, Authorizations, and Spectrum Manager and De Facto Transfer leasing Arrangements and Petition for Declaratory Ruling that the Transaction is Consistent with Section 310(b)(4) of the Communications Act, WT Docket No. 08-95, File Nos. 0003463892, et al., ITC-T/C-20080613-00270, et al., File No. ISP-PDR-20080613-00012, Memorandum Opinion and Order and Declaratory Ruling, 23 FCC Rcd 17444 (2008); Sprint Nextel Corporation and Clearwire Corporation, Applications For Consent to Transfer Control of Licenses, Leases, and Authorizations, WT Docket No. 08-94, File Nos. 0003462540 et al., Memorandum Opinion and Order, 23 FCC Rcd 17570 (2008). 22 Figures in Table 1.11 differ from those in Table 1.10 due to the difference between projected demand and actual disbursements. The figures used in Tables 1.11 and 1.12 include disbursements that were committed over several years but paid out in the appropriate calendar year. In Sections 4 and 5, figures for the Schools and Libraries program and the Rural Health Care program are reported based on fiscal year rather than calendar year. 23 For a discussion of the methodology used to estimate contributions per state, see the Technical Appendix below. 1 - 9 Technical Appendix Carrier revenue information is not reported on a state-by-state basis. Therefore, it is necessary to estimate revenues per state in order to derive contributions made per state. The nationwide sum of contributions to support universal service is equal to the payments made from USAC to recipients of funds from the universal service mechanisms plus administration costs. Contributions on a per-state basis are computed by multiplying nationwide contributions by the ratio of interstate end-user revenues in each state to nationwide interstate end-user revenues. Estimates of interstate end-user revenues by state are reported in Table 1.13. These estimates of end- user interstate revenues are used as a basis for estimating contributions in Table 1.12. 24 The remainder of this appendix provides a detailed description on how revenues are allocated to the states. Table 1.6 presents nationwide data on end-user telecommunications revenues derived from information filed on Form 499-A Telecommunications Reporting Worksheets. Nationwide end- user telecommunications revenues from this table are divided into categories by provider types. These categories are incumbent local exchange carriers (ILECs), competitive local exchange carriers (CLECs) and interconnected VoIP providers, payphone providers, wireless carriers, and toll carriers. Table 1.14 presents end-user telecommunication revenues by intrastate versus interstate and international for each of these categories at the nationwide level. As set forth below, once the revenues are divided into categories, we use data from several sources to estimate each state’s end-user telecommunications revenues. Data from FCC Form 477 are used to estimate the following on a state-by-state basis: intrastate ILEC revenues, CLEC and interconnected VoIP revenues, intrastate toll carrier revenues and wireless revenues. Data from tariff access filings with the FCC along with Form 477 data are used to estimate on a state-by-state basis interstate ILEC revenues. Interstate toll carrier revenues are estimated using data from the National Exchange Carrier Association (NECA) minutes of use data. Table 1.15 shows intrastate end-user telecommunications revenues by category for ILECs, CLECs and interconnected VoIP providers, payphone providers, wireless carriers, and toll carriers. Similarly, components of interstate end-user telecommunications revenues are presented in Table 1.16. Table 1.17 provides most of the underlying data that are used to allocate nationwide revenues to the individual states. We also report each state’s percentage of the nationwide total. We use this percentage to allocate nationwide revenue data in Table 1.14 to individual states in Tables 1.15 and 1.16. These data include ILEC end-user switched access lines, non-ILEC end-user switched access 24 Each state’s share of interstate end-user revenues and contributions are reported under the heading “estimated contributions percent of total.” 1 - 10 lines and interconnected VoIP subscriptions and mobile wireless subscribers reported in FCC Form 477. 25 Also included are data on the number of payphones by state that are independently owned from the National Payphone Clearinghouse. 26 Our data on interstate access minutes are from Table 8.3. In Table 1.15 we allocate intrastate ILEC end-user revenues on a state-by-state basis by multiplying nationwide intrastate ILEC revenues (see Table 1.14) and ILEC end-user switched access lines in a state (see Table 1.17). Similarly, intrastate CLEC and interconnected VoIP providers’ revenues are allocated on a state-by-state basis by multiplying nationwide intrastate CLEC and VoIP provider revenues by the percentage of CLEC end-user switched access lines and interconnected VoIP subscribers in a state. Intrastate payphone provider revenues are allocated on a state-by-state basis by multiplying nationwide intrastate payphone revenues by the percentage of independent payphones in a state. We allocate intrastate wireless revenues on a state-by-state basis by multiplying nationwide intrastate wireless revenues by the percentage of mobile wireless subscriptions in a state. Intrastate toll carriers’ revenues are allocated on a state-by-state basis by multiplying nationwide intrastate ILEC revenues and ILEC end- user switched access lines in a state. In Table 1.16, we allocate end-user interstate revenues to CLEC and interconnected VoIP providers, payphone provider and wireless carriers analogously to how we allocated their respective intrastate revenues. That is, we allocate interstate CLEC and interconnected VoIP providers’ revenues on a state-by-state basis by multiplying nationwide interstate CLEC and VoIP provider revenues by the percentage of CLEC end-user switched access lines and interconnected VoIP subscribers in a state. Interstate payphone provider revenues are allocated on a state-by-state basis by multiplying nationwide interstate payphone revenues by the percentage of independent payphones in a state. We allocate interstate wireless revenues on a state-by-state basis by multiplying nationwide interstate mobile revenues by the percentage of mobile wireless subscriptions in a state. In contrast, interstate ILEC revenues and toll carrier revenues are allocated differently then intrastate revenues. In Table 1.16, interstate toll carriers’ revenues are allocated on a state-by-state basis by multiplying nationwide interstate toll carrier revenues by the percentage of interstate access minutes in the state. Further, interstate ILEC revenues are allocated to states by multiplying interstate ILEC revenues and the percentage of estimated SLC revenue reported in the last column of Table 1.18. We estimate SLC revenue by state in Table 1.18. 27 Our estimate for SLC revenues by state are 25 See Local Telephone Competition: Status as of June 30, 2009 at http://www.fcc.gov/wcb/iatd/comp.html . 26 See Table 7.5 of Trends in Telephone Service at http://www.fcc.gov/wcb/iatd/trends.html. 27 Due to ARMIS forbearance which reduced the amount of data collected by the FCC, we simplified our estimation process for SLC revenues and base it on residential line and business lines. We no longer separate out non-primary residential and single-line business and apply 1 - 11 calculated by the following formula: 12 * (residential lines subject to the SLC) * (primary residential SLC rate per line per month) +12* (business lines) * (multiline business SLC rate per line per month). We use data from Form 477 to estimate residential and business lines. The first and fourth column of Table 1.18 has data on the number of residential and business ILEC end-user switched access lines by state from FCC Form 477. 28 Our estimate of residential customers subject to the SLCs (Column 3) excludes customers that are in the Lifeline program. Our estimate of ILEC Lifeline customers (Column 2) is based on lifeline subscribers by state from Table 2.9 and low-income support payment data for ILECs and CETCs. 29 Residential SLC rates per month, shown in Column 5, are the rates filed for primary residential lines in the Tariff Review Plan (TRP) for price-cap carriers from July 2008 filings and from National Exchange Carrier Association (NECA) pool and rate-of-return carriers. 30 Multiline business SLC rates per line per month in each state, shown in Column 6, are estimated based on the rates in the July 2008 TRP filings for price-cap companies and from NECA pool and rate-of-return carriers. 31 different rates to them. 28 See Local Telephone Competition: Status as of June 30, 2009 at http://www.fcc.gov/wcb/iatd/comp.html . 29 See Appendix to the USAC annual report at http://www.usac.org/about/governance/annual- reports/. 30 Residential and Business lines from Form 477 are used as weights. We assume that the residential SLC for NECA pool and rate-of-return carriers during the relevant time period was $6.50. 31 The rates of NECA pool carriers and rate-of-return carriers are assumed to be $9.20 per line per month for multiline business. Table 1.1 Total Telecommunications Industry Revenues 1 (Dollar Amounts Shown in Millions) Preliminary 5 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Carrier's Carrier Revenues 2 Local Service 3 $33,156 $36,621 $40,108 $38,412 $37,742 $38,546 $39,213 $39,392 $38,383 $39,200 $41,868 Wireless Service 4,652 5,144 6,180 5,020 4,465 4,164 6,334 5,187 5,360 5,630 5,383 Toll Service 14,934 21,849 19,999 16,476 18,205 15,703 16,892 15,101 16,093 13,623 12,069 Intrastate 22,293 25,553 27,848 25,770 24,825 25,852 27,486 24,848 22,566 21,836 22,077 Interstate and International 4 30,449 38,060 38,439 34,138 35,587 32,561 34,953 34,831 37,270 36,617 37,244 Total 52,742 63,613 66,287 59,907 60,412 58,413 62,439 59,679 59,836 58,452 59,320 End User Revenues 2/ Local Service 3 78,608 84,526 87,704 88,712 86,474 83,407 82,382 78,215 75,042 72,693 70,142 Wireless Service 43,843 56,857 68,507 76,501 85,254 94,404 100,743 110,096 115,865 118,855 115,505 Toll Service 93,311 87,767 79,302 67,222 58,983 55,511 52,358 49,278 48,709 47,365 39,259 Intrastate 134,919 147,465 155,347 154,815 150,889 153,265 154,310 157,653 158,380 157,737 150,316 Interstate and International 4 80,844 81,685 80,165 77,619 79,822 80,057 81,173 79,937 81,235 81,176 74,590 Total 215,763 229,149 235,513 232,434 230,711 233,322 235,482 237,589 239,615 238,913 224,906 Total Revenues Local Service 3 111,764 121,147 127,812 127,123 124,216 121,953 121,595 117,607 113,425 111,893 112,010 Wireless Service 48,495 62,000 74,687 81,521 89,718 98,568 107,076 115,283 121,225 124,485 120,888 Toll Service 108,246 109,615 99,301 83,697 77,188 71,214 69,250 64,379 64,802 60,988 51,328 Intrastate 157,212 173,018 183,195 180,585 175,714 179,117 181,796 182,501 180,946 179,573 172,393 Interstate and International 4 111,293 119,745 118,605 111,756 115,409 112,617 116,125 114,768 118,505 117,793 111,833 Total $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 $297,921 $297,268 $299,451 $297,365 $284,226 Note: Detail may not add to totals due to rounding. 1/ 2/ 3/ 4/ 5/ Preliminary 2009 data are based on FCC Form 499-Q quarterly filings through February 28,2010. 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 2009 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 (September 2010). Data include revenues for de minimis filers as well as for other carriers that are exempt from universal service contribution requirements. 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. See Table 1.4 for further details on contribution bases. Payphone revenues are included with local service revenues in this table. Revenues from calls that both originate and terminate in foreign points are reported as end-user revenues, and are included in this table through 2008, but are not included in the universal service contribution base. These revenues are not included in preliminary 2009 data. 1 - 12 Table 1.2 Telecommunications Industry Revenues by Service (Dollar Amounts Shown in Millions) 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Local Exchange $59,245 $64,940 $69,947 $72,346 $71,320 $70,606 $68,238 $66,506 $63,264 $62,790 $60,871 Pay Telephone 2,536 2,218 1,932 1,585 1,192 1,063 1,002 924 659 470 379 Local Private Line 10,403 12,914 16,864 21,966 23,070 22,415 23,840 25,673 25,448 24,307 26,314 Other Local 2,179 2,501 3,249 3,391 3,418 3,242 2,944 3,331 3,884 3,227 3,321 Subscriber Line Charges 11,052 10,826 11,563 12,127 12,758 12,136 11,715 11,113 10,827 10,141 9,283 Access 18,449 18,105 17,017 15,096 13,955 12,972 12,352 11,822 11,392 10,543 9,776 103 260 575 1,301 1,410 1,783 1,862 2,227 2,133 1,947 1,948 595 Total Local Service 104,563 111,764 121,147 127,812 127,123 124,216 121,953 121,595 117,607 113,425 111,893 Wireless Service 36,240 48,117 61,505 74,006 80,678 88,023 96,450 104,489 112,442 117,939 120,934 345 379 495 681 842 1,696 2,118 2,587 2,841 3,286 3,551 189 Total Wireless Service 36,775 48,495 62,000 74,687 81,521 89,718 98,568 107,076 115,283 121,225 124,485 Operator 1/ 12,205 10,049 11,406 10,389 7,902 6,567 6,542 6,631 5,577 5,874 5,664 Non-Operator Switched Toll 74,168 78,389 75,183 65,325 54,475 50,178 46,387 44,876 41,570 42,518 38,959 Long Distance Private Line 11,952 13,169 16,189 16,402 15,108 15,316 13,906 13,264 12,739 12,080 11,683 Other Long Distance 3,386 3,656 3,372 3,259 2,445 2,222 1,801 2,021 2,154 1,661 2,071 1,810 2,983 3,467 3,927 3,767 2,905 2,577 2,458 2,340 2,669 2,611 1,532 Total Toll Service 105,055 108,246 109,615 99,301 83,697 77,188 71,214 69,250 64,379 64,802 60,988 Total Telecommunications 246,392 268,505 292,762 301,799 292,341 291,122 291,735 297,921 297,269 299,451 297,366 Non-Telecommunications 27,944 33,144 42,261 48,036 60,406 65,186 71,493 86,764 101,061 131,615 151,494 Total Reported Revenues 272,019 301,648 335,023 349,835 352,747 356,308 363,227 384,685 398,329 431,066 448,860 Service Reported as: Intrastate 142,108 157,212 173,018 183,195 180,585 175,714 179,129 181,796 182,501 180,946 179,573 Interstate and International 104,284 111,293 119,745 118,605 111,756 115,409 112,605 116,125 114,768 118,505 117,793 Total Telecommunications $246,392 $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 $297,921 $297,268 $299,451 $297,365 Universal Service Surcharges on Local Service Bills 1 Additional Revenues from TRS Worksheets Universal Service Surcharges on Local Service Bills 1 Additional Revenues from TRS Worksheets Universal Service Surcharges on Local Service Bills 1 Additional Revenues from TRS Worksheets Note: Detail may not add to totals due to rounding. Some data for prior years have been revised. 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 (September 2010). Data for 1998 primarily based on FCC Form 457 Universal Service Worksheets. Starting in 1999, data summarized from FCC Form 499-A Telecommunications Reporting Worksheets, which replaced both FCC Form 431 and FCC Form 457. 1/ 1 - 13 Service Provider Category 1/ 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 Incumbent Local Exchange Carriers $108,234 $112,216 $116,158 $117,885 $114,990 $109,480 $105,496 $103,561 $99,997 $93,885 $89,732 Competitive Access Providers (CAPs) and Competitive Local Exchange Carriers (CLECs) 3,348 5,652 9,814 12,998 13,043 15,509 15,112 16,930 17,276 17,476 20,980 Interconnected VoIP 514 2,394 3,541 Local Resellers 410 511 879 1,393 1,538 721 1,215 630 460 594 540 Other Local Exchange Carriers 36 171 11 329 406 338 245 216 124 181 288 Private Service Providers 147 87 39 15 281 267 532 770 1,080 1,031 1,051 Shared-Tenant Service Providers 93 87 202 46 42 22 22 22 19 14 39 Competitors of Incumbent LECs 4,034 6,508 10,945 14,781 15,309 16,857 17,126 18,568 19,473 21,690 26,440 Fixed Local Service Providers 112,268 118,725 127,103 132,666 130,300 126,337 122,622 122,128 119,470 115,575 116,172 Payphone Providers 1,101 1,213 972 836 641 523 445 481 435 388 275 Wireless Telephony Including Cellular, 33,139 46,513 59,823 71,887 78,568 88,168 98,329 107,834 116,971 123,968 127,730 Personal Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service 3,161 3,232 3,102 2,197 1,473 1,007 872 579 555 607 426 Specialized Mobile Radio (SMR) 186 191 188 206 33 46 226 48 188 40 Dispatch Wireless Data Service Providers and Other Mobile Service Providers 731 221 164 324 220 135 218 169 178 180 119 Wireless Service Providers 37,032 50,152 63,280 74,596 80,467 89,342 99,465 108,809 117,752 124,943 128,314 Interexchange Carriers (IXCs) 83,443 87,570 87,311 81,272 68,146 61,246 51,589 46,856 44,083 43,701 37,358 Operator Service Providers (OSPs) 590 337 635 611 554 567 523 548 631 595 1,063 Prepaid Calling Card Providers 888 866 727 133 460 812 1,635 1,828 1,713 2,195 1,999 Satellite Service Providers 475 280 336 373 406 663 721 714 444 708 860 Toll Resellers 9,885 9,211 10,641 8,797 9,279 9,294 12,192 13,362 9,943 8,314 8,256 Audio Bridge Service Providers 42 58 273 Other Toll Carriers 710 150 1,758 2,516 2,089 2,339 2,543 3,195 2,756 2,973 2,795 Toll Service Providers 95,992 98,414 101,407 93,702 80,934 74,920 69,204 66,503 59,611 58,545 52,604 Total Telecommunications Revenues $246,392 $268,505 $292,762 $301,799 $292,341 $291,123 $291,734 $297,921 $297,268 $299,451 $297,365 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (September 2010). Data for 1998 primarily based on FCC Form 457 Universal Service Worksheets. Starting in 1999, data summarized from FCC Form 499-A Telecommunications Reporting Worksheets, which replaced both FCC Form 431 and FCC Form 457. 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 FCC Form 431 TRS worksheets because there was no separate category for satellite service providers. For 2003 through 2005, some filers identified themselves as all distance carriers. These filers have been reclassified to be consistent with prior classifications. Starting with the 2007 FCC Form 499-A filing, which reported 2006 revenue data, some filers identified themselves as interconnected VoIP providers and some filers first began reporting revenues for these services. Table 1.3 Telecommunications and Interconnected VoIP Revenues Reported by Type of Carrier (Dollar Amounts Shown in Millions) 1 - 14 2008 Revenues subject to universal service contribution Billed interstate and international end-user revenues [ Line 412(e) + Line 420(d) + Line 420(e) ] $80,956 less revenues for international - to - international services [ Line 412(e) ] 862 less international revenues of international-only filers and international revenues that were excluded because of 4,148 the 12% rule 2 less interstate and other international revenues for 2,553 filers who are ide minimis or otherwise exempt from universal service support requirements 51 less uncollectible contribution base revenues [ Line 422(d) + Line 422(e) ] 1,131 (Does not include uncollectible amounts associated with revenues excluded above. equals $74,764 Revenues subject to TRS contribution Interstate and international end-user revenues $80,956 less interstate and international revenues for 128 filers who identify themselves as private service providers or as shared tenent service providers and who therefore are exempt from telecommunications relay service (TRS) contribution requirements if they provide no carrier services 901 less iinterstate and international revenues for services provided for resale but reported as end user because it was provided to carriers that do not contribute to universal service support mechanisms [ Line 511(b) ] 235 equals $79,820 Revenues subject to NANPA and LNP contribution Total telecommunications service end-user revenues (including intrastate, interstate and international) $238,697 less telecommunications revenues for 534 filers who identify themselves as private service providers, shared tenent service providers or payphone service providers and who therefore are exempt from North American Numbering Plan Administration (NANPA) and local number portability administration (LNP) contribution requirements if they provide no carrier services 739 less telecommunications revenues for services provided for resale but reported as end user because it was provided to carriers that do not contribute to universal service support mechanisms [ Line 511 (a) ] 251 equals $237,707 1/ 2/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (September 2010). Ebased on revenues and the filer type information contained in the FCC Form 499-A filings. The fund administrators may use carrier type, revenue type, line 603 exemption certifications and additional information requested from filers to determine which filers must contribute. The universal service fund administrator bills delinquent filers based on estimated revenues and may, in some instances, include estimated revenue amounts in contribution base amounts. Note also that universal service contribution factors are set quarterly based on FCC Form 499-Q filings. FCC Form 499-A data are used for true-up and auditing purposes. Also note that local number portability contribution amounts are determined by region of the country rather than on a nationwide basis. As a result of these factors, actual contribution bases have been based on slightly different amounts than those shown. Table 1.4 Contribution Base Revenues By Program 1 : 2008 (Dollar Amounts Shown in Millions) International revenues are excluded from the contribution base if the total amount of interstate end-user revenues for the filing entity consolidated with all affiliates is less than 12% of the total of interstate and international end-user revenues for the filing entity consolidated with all affiliates. See 47 C.F.R. § 54.706(c). The threshold was increased from 8% to 12% in 2002. See Federal-State Joint Board on Universal Service , et al., CC Docket Nos. 96-45, 98-171, 90-571, 92-237, 99-200, 95-166, 98-170, Further Notice of Proposed Rulemaking and Report and Order, 17 FCC Rcd 3752, 3806, para. 125 (2002). In addition, filers that provide only international services are exempt regardless of services offered by affiliates. This table shows how contribution bases differ for different programs and provides relative magnitudes, but does not provide the actual amounts used for determining contribution amounts. Amounts shown represent the amounts contained in the FCC Form 499-A database as of December 7, 2009. The universal service administrator continues to receive additional and corrected 1 - 15 Table 1.5 Revenues from Telecommunications and Interconnected VoIP Service Provided for Resale 1 : 2008 (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Regional Bell Operating Company Other Incumbent Local Incumbent Local Exchange Carriers Exchange Carriers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 303 Monthly service, local calling, connection charges, vertical features, and other local exchange service including subscriber line and PICC charges to IXCs .1 Provided as unbundled network elements (UNEs) $2,149 $207 $0 $2,357 $151 $13 * $164 .2 Provided under other arrangements 512 80 0 592 86 72 0 158 Total Line 303 2,661 288 0 2,949 236 85 * 321 304 Per-minute charges for originating or terminating calls .1 Provided under state or federal access tariff 2,039 2,014 0 4,053 1,865 982 2 2,848 .2 Provided as unbundled network elements or other contract arrangement 324 436 0 760 55 52 * 106 Total Line 304 2,363 2,450 0 4,813 1,919 1,033 2 2,954 305 Local private line & special access 523 11,486 0 12,009 288 1,831 * 2,120 306 Payphone compensation from toll carriers 16 23 0 39 * 1 * 2 307 Other local telecommunications service revenues 1,935 467 0 2,402 37 6 0 43 308 Universal service support revenues received from 781 742 0 1,523 649 1,929 * 2,578 Federal or state sources Total fixed local service provided for resale 8,278 15,456 0 23,734 3,130 4,885 3 8,018 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 309 Monthly, activation, and message charges except toll 46 16 0 62 31 37 * 68 Total mobile service provided for resale 46 16 0 62 31 37 * 68 Toll service 310 Operator and toll calls with alternative billing 10 01 * * 0 * arrangements (credit card, collect, international call-back, etc.) 311 Ordinary long distance (direct dialed MTS, customer 130 * 0 130 3 1 * 4 toll-free 8xx service, "10-10 calls", associated monthly account maintenance, PICC pass-through, and other switched services not reported above) 312 Long distance private line services 22 7 0 29 6 6 0 13 313 Satellite services 00 00 * * 0 * 314 All other long distance services * * 0 * 7 2 * 8 Total toll service provided for resale 153 8 0 160 16 9 * 25 315 Total service provided for resale (carrier's carrier) $8,476 $15,480 $0 $23,956 $3,178 $4,932 $3 $8,112 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 16 Table 1.5 Revenues from Telecommunications and Interconnected VoIP Service Provided for Resale 1 : 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A CLECs and Other Payphone Providers Fixed Local Competitors Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 303 Monthly service, local calling, connection charges, vertical features, and other local exchange service including subscriber line and PICC charges to IXCs .1 Provided as unbundled network elements (UNEs) $47 $140 $1 $188 * * * * .2 Provided under other arrangements 206 24 1 231 * 0 0 * Total Line 303 252 164 2 418 * * * * 304 Per-minute charges for originating or terminating calls .1 Provided under state or federal access tariff 569 592 43 1,204 * * * * .2 Provided as unbundled network elements or other contract arrangement 327 150 42 519 0 0 0 0 Total Line 304 896 743 85 1,723 * * * * 305 Local private line & special access 1,240 811 74 2,125 1 1 * 2 306 Payphone compensation from toll carriers * * * * 34 59 2 95 307 Other local telecommunications service revenues 25 3 * 29 1 * * 2 308 Universal service support revenues received from 55 60 0 115 * * 0 * Federal or state sources Total fixed local service provided for resale 2,469 1,780 161 4,410 37 60 2 99 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 309 Monthly, activation, and message charges except toll 45 09 * * 0 * Total mobile service provided for resale 45 09 * * 0 * Toll service 310 Operator and toll calls with alternative billing 377 * 80 1 1 * 1 arrangements (credit card, collect, international call-back, etc.) 311 Ordinary long distance (direct dialed MTS, customer 252 288 186 726 * * 0 * toll-free 8xx service, "10-10 calls", associated monthly account maintenance, PICC pass-through, and other switched services not reported above) 312 Long distance private line services 250 880 49 1,178 0 0 0 0 313 Satellite services 10 34 00 00 314 All other long distance services 24 11 * 35 * * 0 * Total toll service provided for resale 529 1,256 238 2,023 1 1 * 2 315 Total service provided for resale (carrier's carrier) $3,002 $3,041 $399 $6,442 $38 $61 $2 $101 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 17 Table 1.5 Revenues from Telecommunications and Interconnected VoIP Service Provided for Resale 1 : 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Cellular, PCS and SMR Wireless Other Wireless Telephony Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 303 Monthly service, local calling, connection charges, vertical features, and other local exchange service including subscriber line and PICC charges to IXCs .1 Provided as unbundled network elements (UNEs) $6 $0 * $6 $0 $0 $0 $0 .2 Provided under other arrangements 0.6 0 0 0.6 0 0 0 0 Total Line 303 70 * 7 0 0 0 0 304 Per-minute charges for originating or terminating calls .1 Provided under state or federal access tariff 22 * 3 * * 0 * .2 Provided as unbundled network elements or other contract arrangement 16 17 0 32 1 * 3.6 4 Total Line 304 17 18 * 36 1 * 4 5 305 Local private line & special access 23 1 0 24 1 3 * 4 306 Payphone compensation from toll carriers 00 00 * * * * 307 Other local telecommunications service revenues 2 * * 3 13 1 * 14 308 Universal service support revenues received from 290 835 * 1,126 1 * 0 1 Federal or state sources Total fixed local service provided for resale 340 854 * 1,194 15 4 4 23 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 309 Monthly, activation, and message charges except toll 3,952 1,407 4 5,363 32 19 * 51 Total mobile service provided for resale 3,952 1,407 4 5,363 32 19 * 51 Toll service 310 Operator and toll calls with alternative billing 1 * * 1 0 0 0 0 arrangements (credit card, collect, international call-back, etc.) 311 Ordinary long distance (direct dialed MTS, customer 290 286 1 577 * 3 * 3 toll-free 8xx service, "10-10 calls", associated monthly account maintenance, PICC pass-through, and other switched services not reported above) 312 Long distance private line services * * 0 * 0 0 0 0 313 Satellite services 00 00 00 00 314 All other long distance services 52 210 * * * * Total toll service provided for resale 295 288 4 587 * 3 * 3 315 Total service provided for resale (carrier's carrier) $4,587 $2,550 $8 $7,144 $47 $26 $4 $77 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 18 Table 1.5 Revenues from Telecommunications and Interconnected VoIP Service Provided for Resale 1 : 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Toll Carriers Total All Filers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 303 Monthly service, local calling, connection charges, vertical features, and other local exchange service including subscriber line and PICC charges to IXCs .1 Provided as unbundled network elements (UNEs) $4 $6 * $10 $2,357 $366 $2 $2,725 .2 Provided under other arrangements 247 351 37.2 636 1,051 527 38 1,617 Total Line 303 251 357 38 646 3,408 894 40 4,341 304 Per-minute charges for originating or terminating calls .1 Provided under state or federal access tariff 47 46 3 97 4,522 3,636 48 8,206 .2 Provided as unbundled network elements or other contract arrangement 66 76 7 149 787 730 52 1,570 Total Line 304 113 122 10 246 5,309 4,366 100 9,776 305 Local private line & special access 295 439 25 759 2,371 14,571 99 17,041 306 Payphone compensation from toll carriers * * 1 1 50 84 3 137 307 Other local telecommunications service revenues 22 6 * 29 2,036 484 1 2,521 308 Universal service support revenues received from 35 6 0 41 1,812 3,572 * 5,384 Federal or state sources Total fixed local service provided for resale 717 931 73 1,722 14,986 23,971 243 39,200 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 309 Monthly, activation, and message charges except toll 47 23 8 77 4,110 1,507 13 5,630 Total mobile service provided for resale 47 23 8 77 4,110 1,507 13 5,630 Toll service 310 Operator and toll calls with alternative billing 15 39 94 148 20 117 94 231 arrangements (credit card, collect, international call-back, etc.) 311 Ordinary long distance (direct dialed MTS, customer 1,440 2,954 3,890 8,283 2,114 3,531 4,077 9,722 toll-free 8xx service, "10-10 calls", associated monthly account maintenance, PICC pass-through, and other switched services not reported above) 312 Long distance private line services 263 1,436 250 1,948 541 2,330 298 3,169 313 Satellite services 3 68 124 194 4 68 127 198 314 All other long distance services 24 118 107 249 59 133 110 302 Total toll service provided for resale 1,745 4,614 4,463 10,822 2,739 6,179 4,705 13,623 315 Total service provided for resale (carrier's carrier) $2,509 $5,568 $4,544 $12,621 $21,836 $31,656 $4,960 $58,452 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 19 Table 1.6 Revenues from Telecommunications and Interconnected VoIP Service Provided to End Users: 2008 (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Regional Bell Operating Company Other Incumbent Local Incumbent Local Exchange Carriers Exchange Carriers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 404 Monthly service, local calling, connection charges, vertical features, and other local exchange service charges except for federally tariffed subscriber line charges and PICC charges: .1 & .3 Traditional Circuit Switched $30,997 * $0 $30,997 $6,704 $16 $0 $6,720 .4 & .5 Interconnected Voice over Internet Protocol 612 0 18 * 1 0 1 405 Tariffed subscriber line charges and PICC charges 122 6,219 0 6,342 47 1,649 0 1,696 levied by a local exchange carrier on a no-PIC customer Total local exchange (Line 404 + Line 405) 31,125 6,231 0 37,356 6,751 1,666 0 8,417 406 Local private line and special access service 2,595 2,638 0 5,234 535 546 * 1,081 407 Payphone coin revenues (local and long distance) 87 * 0 87 18 * * 18 408 Other local telecommunications service revenues 399 12 0 411 68 2 * 70 Line 403 surcharges on fixed local service 1 173 1,005 0 1,178 32 231 0 263 Total fixed local service provided to end users 34,380 9,886 0 44,266 7,404 2,445 * 9,849 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 409 Monthly and activation charges 14 0 0 14 286 68 * 354 410 Message charges including roaming, but excluding 63 0 0 63 40 11 * 51 toll charges Line 403 surcharges on mobile service 1 * 0 0 * 2 8 0 10 Total mobile service provided to end users 77 0 0 77 328 87 * 415 Toll service 411 Prepaid calling card (including card sales to * * 0 * * * * 1 customers and non-carrier distributors) reported at face value of cards 412 International calls that both originate and terminate in 00 00 00 0 0 foreign points 413 Operator and toll calls with alternative billing 35 * 0 35 5 * * 5 arrangements (credit card, collect, international call- back, etc.) other than revenues reported on Line 412 414 Ordinary long distance (direct-dialed MTS, customer 1,535 105 * 1,640 347 50 2 399 toll-free 8xx service, "10-10" calls, associated monthly account maintenance, PICC pass-through, and other switched services not reported above), including long distance charges bundled with local exchange service 415 Long distance private line services 865 1 0 866 68 6 * 74 416 Satellite services 00 0 0 * 0 0 * 417 All other long distance services 14 1 0 14 2 * 0 2 Line 403 surcharges on toll service 1 5 11 0 16 2 5 * 7 Total toll service provided to end users 2,453 118 * 2,571 424 61 3 488 Total telecommunications and interconnected VoIP $36,910 $10,004 * $46,914 $8,156 $2,592 $3 $10,751 service provided to end users 422 Uncollectible revenue/bad debt expense associated 614 115 * 729 123 26 * 149 with end user revenues other than Line 412 423 Net universal service contribution base revenues $36,296 $9,888 * $46,184 $8,033 $2,566 $3 $10,602 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 20 Table 1.6 Revenues from Telecommunications and Interconnected VoIP Service Provided to End Users: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A CLECs and Other Payphone Providers Fixed Local Competitors Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 404 Monthly service, local calling, connection charges, vertical features, and other local exchange service charges except for federally tariffed subscriber line charges and PICC charges: 0 & .3 Traditional Circuit Switched $5,632 $174 $9 $5,816 * * $0 * 0 & .5 Interconnected Voice over Internet Protocol 4,145 1,184 143 5,472 * * 0 * 405 Tariffed subscriber line charges and PICC charges 35 960 7 1,001 * 0 0 * levied by a local exchange carrier on a no-PIC customer Total local exchange (Line 404 + Line 405) 9,812 2,318 159 12,289 * * 0 * 406 Local private line and special access service 1,225 779 6 2,010 0 0 0 0 407 Payphone coin revenues (local and long distance) 2 * * 3 115 6 1 122 408 Other local telecommunications service revenues 234 30 1 265 * * * * Line 403 surcharges on fixed local service 1/ 61 315 2 378 * * 0 * Total fixed local service provided to end users 11,335 3,443 168 14,945 116 6 1 122 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 409 Monthly and activation charges 28 25 * 53 * * 0 * 410 Message charges including roaming, but excluding 21 * 3 1 * 0 1 toll charges Line 403 surcharges on mobile service 1/ * 3 * 3 0 0 0 0 Total mobile service provided to end users 31 29 * 59 1 * 0 1 Toll service 411 Prepaid calling card (including card sales to 2 5 81 88 * * 1 1 customers and non-carrier distributors) reported at face value of cards 412 International calls that both originate and terminate in 00 88 00 * * foreign points 413 Operator and toll calls with alternative billing 14 8 2 24 42 8 * 50 arrangements (credit card, collect, international call- back, etc.) other than revenues reported on Line 412 414 Ordinary long distance (direct-dialed MTS, customer 1,468 1,570 357 3,395 * * * * toll-free 8xx service, "10-10" calls, associated monthly account maintenance, PICC pass-through, and other switched services not reported above), including long distance charges bundled with local exchange service 415 Long distance private line services 192 710 69 970 0 0 0 0 416 Satellite services 1 5 20 26 * * * * 417 All other long distance services 76 120 12 208 * * 0 * Line 403 surcharges on toll service 1/ 9 259 7 275 0 0 0 0 Total toll service provided to end users 1,760 2,677 557 4,994 42 8 1 51 Total telecommunications and interconnected VoIP $13,125 $6,148 $725 $19,998 $158 $15 $1 $174 service provided to end users 422 Uncollectible revenue/bad debt expense associated 221 92 10 322 1 * * 1 with end user revenues other than Line 412 423 Net universal service contribution base revenues $12,905 $6,056 $707 $19,668 $157 $15 $1 $173 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 21 Table 1.6 Revenues from Telecommunications and Interconnected VoIP Service Provided to End Users: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Cellular, PCS and SMR Wireless Other Wireless Telephony Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 404 Monthly service, local calling, connection charges, vertical features, and other local exchange service charges except for federally tariffed subscriber line charges and PICC charges: 0 & .3 Traditional Circuit Switched $8 $6 $0 $14 $10 * $0 $10 0 & .5 Interconnected Voice over Internet Protocol $5 $4 $0 $9 4 $2 * 6 405 Tariffed subscriber line charges and PICC charges 0 7 0 7 0 0 0 0 levied by a local exchange carrier on a no-PIC customer Total local exchange (Line 404 + Line 405) 13 18 0 31 14 2 * 16 406 Local private line and special access service 24 1 0 25 23 1 0 24 407 Payphone coin revenues (local and long distance) 00 0 0 * * * * 408 Other local telecommunications service revenues 20 1 0 20 15 2 0 17 Line 403 surcharges on fixed local service 1/ * 2 0 2 * * 0 * Total fixed local service provided to end users 57 21 0 79 52 6 * 58 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 409 Monthly and activation charges 73,243 22,320 204 95,767 370 45 * 414 410 Message charges including roaming, but excluding 14,143 3,986 195 18,324 17 3 * 20 toll charges Line 403 surcharges on mobile service 1/ 563 2,957 4 3,523 2 5 * 7 Total mobile service provided to end users 87,949 29,263 403 117,615 389 52 * 441 Toll service 411 Prepaid calling card (including card sales to 32 2 7 * * * * customers and non-carrier distributors) reported at face value of cards 412 International calls that both originate and terminate in 00 99 00 0 0 foreign points 413 Operator and toll calls with alternative billing 56 29 1 86 0 0 * * arrangements (credit card, collect, international call- back, etc.) other than revenues reported on Line 412 414 Ordinary long distance (direct-dialed MTS, customer 578 856 1,237 2,672 3 2 1 5 toll-free 8xx service, "10-10" calls, associated monthly account maintenance, PICC pass-through, and other switched services not reported above), including long distance charges bundled with local exchange service 415 Long distance private line services * * * * 0 1 0 1 416 Satellite services * * 0 * * * * * 417 All other long distance services * 6 3 9 * 2 * 2 Line 403 surcharges on toll service 1/ 3 101 6 109 * * * * Total toll service provided to end users 641 994 1,257 2,892 3 5 1 9 Total telecommunications and interconnected VoIP $88,647 $30,279 $1,660 $120,586 $444 $63 $1 $508 service provided to end users 422 Uncollectible revenue/bad debt expense associated 1,841 529 27 2,397 4 1 * 5 with end user revenues other than Line 412 423 Net universal service contribution base revenues $86,805 $29,751 $1,624 $118,180 $440 $62 $1 $503 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 22 Table 1.6 Revenues from Telecommunications and Interconnected VoIP Service Provided to End Users: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Toll Carriers Total All Filers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service 404 Monthly service, local calling, connection charges, vertical features, and other local exchange service charges except for federally tariffed subscriber line charges and PICC charges: 0 & .3 Traditional Circuit Switched $2,033 $4 $1 $2,037 $45,384 $201 $10 $45,595 0 & .5 Interconnected Voice over Internet Protocol 21 22 2 45 4,181 1,224 146 5,551 405 Tariffed subscriber line charges and PICC charges 2 235 0 237 207 9,070 7 9,283 levied by a local exchange carrier on a no-PIC customer Total local exchange (Line 404 + Line 405) 2,055 262 3 2,320 49,771 10,496 162 60,429 406 Local private line and special access service 143 737 20 900 4,544 4,703 26 9,273 407 Payphone coin revenues (local and long distance) 8 4 1 13 231 11 2 243 408 Other local telecommunications service revenues 13 3 * 16 749 50 1 800 Line 403 surcharges on fixed local service 1/ 22 104 1 126 288 1,658 3 1,948 Total fixed local service provided to end users 2,239 1,109 26 3,374 55,583 16,916 194 72,693 Mobile service (including wireless telephony, paging & messaging, and other mobile services) 409 Monthly and activation charges 128 55 8 191 74,069 22,512 213 96,794 410 Message charges including roaming, but excluding 29 13 6 48 14,295 4,015 201 18,511 toll charges Line 403 surcharges on mobile service 1/ 1 8 * 9 567 2,980 4 3,551 Total mobile service provided to end users 158 76 14 248 88,931 29,507 417 118,855 Toll service 411 Prepaid calling card (including card sales to 177 158 2,982 3,316 182 165 3,065 3,412 customers and non-carrier distributors) reported at face value of cards 412 International calls that both originate and terminate in 0 0 844 844 0 0 862 862 foreign points 413 Operator and toll calls with alternative billing 537 279 143 959 688 324 147 1,159 arrangements (credit card, collect, international call- back, etc.) other than revenues reported on Line 412 414 Ordinary long distance (direct-dialed MTS, customer 6,454 11,119 3,553 21,126 10,384 13,703 5,149 29,236 toll-free 8xx service, "10-10" calls, associated monthly account maintenance, PICC pass-through, and other switched services not reported above), including long distance charges bundled with local exchange service 415 Long distance private line services 611 5,316 676 6,603 1,736 6,033 745 8,514 416 Satellite services 15 149 252 416 16 155 272 442 417 All other long distance services 53 719 121 893 145 848 136 1,128 Line 403 surcharges on toll service 1/ 54 1,932 218 2,204 72 2,307 231 2,611 Total toll service provided to end users 7,900 19,672 8,789 36,361 13,223 23,535 10,607 47,365 Total telecommunications and interconnected VoIP $10,297 $20,857 $8,828 $39,982 $157,737 $69,958 $11,218 $238,913 service provided to end users 422 Uncollectible revenue/bad debt expense associated 290 282 97 669 3,094 1,044 134 4,272 with end user revenues other than Line 412 423 Net universal service contribution base revenues $10,007 $20,576 $7,887 $38,469 $154,643 $68,914 $10,223 $233,780 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 23 Table 1.7 Total Revenues: 2008 (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Regional Bell Operating Company Other Incumbent Local Incumbent Local Exchange Carriers Exchange Carriers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service other than payphone $42,555 $25,319 $0 $67,873 $10,516 $7,329 $2 $17,847 [Lines 303, 304, 305, 307, 308, 404, 405, 406, 408, and a portion of 403 1 ] Payphone 103 24 0 126 18 1 * 20 [Lines 306 and 407] Mobile service 123 16 0 139 359 124 * 483 [Lines 309, 409, 410, and a portion of 403 1 ] Toll service 2,606 125 * 2,731 440 70 3 513 [Lines 310, 311, 312, 313, 314, 411, 412, 413, 414, 415, 416, 417, and a portion of 403 1 ] Total telecommunications and IVoIP service revenues 45,386 25,483 * 70,869 11,334 7,524 6 18,863 Total telecommunications and IVoIP service provided 8,476 15,480 0 23,956 3,178 4,932 3 8,112 for resale (from Table 5) Total telecommunications and IVoIP service provided to 36,910 10,004 * 46,914 8,156 2,592 3 10,751 end users (from Table 6) Total telecommunications and IVoIP service revenues 45,386 25,483 * 70,869 11,334 7,524 6 18,863 418 Enhanced services, inside wiring maintenance, billing and collection, customer premises equipment, published directory, dark fiber, Internet access, cable TV program transmission, and non-telecommunications service revenues .1 bundled with circuit switched local exchange service - - - - - - - - - 1,492 - - - - - - - - - 1,161 .2 bundled with interconnected VoIP local exchange service - - - - - - - - - 0 - - - - - - - - - * .3 other - - - - - - - - - $19,990 - - - - - - - - - $2,877 419 Gross billed revenues from all sources - - - - - - - - - $92,351 - - - - - - - - - $22,901 421 Uncollectible revenue/bad debt expense associated $945 $234 with gross billed revenues Total collected revenues from all sources 91,406 $22,667 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 24 Table 1.7 Total Revenues: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A CLECs and Other Payphone Providers Fixed Local Competitors Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service other than payphone $13,801 $5,222 $329 $19,353 $3 $1 * $5 [Lines 303, 304, 305, 307, 308, 404, 405, 406, 408, and a portion of 403 1/] Payphone 2 1 * 3 149 65 3 216 [Lines 306 and 407] Mobile service 34 34 * 68 1 * 0 1 [Lines 309, 409, 410, and a portion of 403 1/] Toll service 2,289 3,933 795 7,017 43 9 1 53 [Lines 310, 311, 312, 313, 314, 411, 412, 413, 414, 415, 416, 417, and a portion of 403 1/] Total telecommunications and IVoIP service revenues 16,127 9,189 1,124 26,440 196 76 3 275 Total telecommunications and IVoIP service provided 3,002 3,041 399 6,442 38 61 2 101 for resale (from Table 5) Total telecommunications and IVoIP service provided to 13,125 6,148 725 19,998 158 15 1 174 end users (from Table 6) Total telecommunications and IVoIP service revenues 16,127 9,189 1,124 26,440 196 76 3 275 418 Enhanced services, inside wiring maintenance, billing and collection, customer premises equipment, published directory, dark fiber, Internet access, cable TV program transmission, and non-telecommunications service revenues .1 bundled with circuit switched local exchange service - - - - - - - - - 1,500 - - - - - - - - - 0 .2 bundled with interconnected VoIP local exchange service - - - - - - - - - 907 - - - - - - - - - 0 .3 other - - - - - - - - - $28,148 - - - - - - - - - $65 419 Gross billed revenues from all sources - - - - - - - - - $56,996 - - - - - - - - - $340 421 Uncollectible revenue/bad debt expense associated $703 $4 with gross billed revenues Total collected revenues from all sources 56,293 $336 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 25 Table 1.7 Total Revenues: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Cellular, PCS and SMR Wireless Other Wireless Telephony Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service other than payphone $397 $876 * $1,273 $67 $10 $4 $81 [Lines 303, 304, 305, 307, 308, 404, 405, 406, 408, and a portion of 403 1/] Payphone 00 0 0 * * * * [Lines 306 and 407] Mobile service 91,901 30,670 407 122,978 421 71 * 492 [Lines 309, 409, 410, and a portion of 403 1/] Toll service 936 1,283 1,261 3,480 38 1 1 [Lines 310, 311, 312, 313, 314, 411, 412, 413, 414, 415, 416, 417, and a portion of 403 1/] Total telecommunications and IVoIP service revenues 93,233 32,829 1,668 127,730 491 88 5 584 Total telecommunications and IVoIP service provided 4,587 2,550 8 7,144 47 26 $4 77 for resale (from Table 5) Total telecommunications and IVoIP service provided to 88,647 30,279 1,660 120,586 444 63 1 508 end users (from Table 6) Total telecommunications and IVoIP service revenues 93,233 32,829 1,668 127,730 491 88 5 584 418 Enhanced services, inside wiring maintenance, billing and collection, customer premises equipment, published directory, dark fiber, Internet access, cable TV program transmission, and non-telecommunications service revenues .1 bundled with circuit switched local exchange service - - - - - - - - - 1,108 - - - - - - - - - 24 .2 bundled with interconnected VoIP local exchange service - - - - - - - - - * - - - - - - - - - * .3 other - - - - - - - - - $52,353 - - - - - - - - - $4,982 419 Gross billed revenues from all sources - - - - - - - - - $181,192 - - - - - - - - - $5,590 421 Uncollectible revenue/bad debt expense associated $3,016 $8 with gross billed revenues Total collected revenues from all sources 178,177 $5,582 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 26 Table 1.7 Total Revenues: 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Toll Carriers Total All Filers Line Intrastate Interstate International Total Intrastate Interstate International Total Fixed local service other than payphone $2,949 $2,036 $97 $5,082 $70,288 $40,793 $432 $111,514 [Lines 303, 304, 305, 307, 308, 404, 405, 406, 408, and a portion of 403 1/] Payphone 8 4 2 14 281 94 5 379 [Lines 306 and 407] Mobile service 204 99 22 325 93,042 31,014 430 124,485 [Lines 309, 409, 410, and a portion of 403 1/] Toll service 9,645 24,286 13,252 47,183 15,962 29,714 15,312 60,988 [Lines 310, 311, 312, 313, 314, 411, 412, 413, 414, 415, 416, 417, and a portion of 403 1/] Total telecommunications and IVoIP service revenues 12,806 26,425 13,373 52,604 179,573 101,614 16,179 297,365 Total telecommunications and IVoIP service provided 2,509 5,568 4,544 12,621 21,836 31,656 4,960 58,452 for resale (from Table 5) Total telecommunications and IVoIP service provided to 10,297 20,857 8,828 39,982 157,737 69,958 11,218 238,913 end users (from Table 6) Total telecommunications and IVoIP service revenues 12,806 26,425 13,373 52,604 179,573 101,614 16,179 297,365 418 Enhanced services, inside wiring maintenance, billing and collection, customer premises equipment, published directory, dark fiber, Internet access, cable TV program transmission, and non-telecommunications service revenues .1 bundled with circuit switched local exchange service - - - - - - - - - 609 - - - - - - - - - 5,896 .2 bundled with interconnected VoIP local exchange service - - - - - - - - - 117 - - - - - - - - - 1,025 .3 other - - - - - - - - - $36,159 - - - - - - - - - $144,574 419 Gross billed revenues from all sources - - - - - - - - - $89,490 - - - - - - - - - $448,859 421 Uncollectible revenue/bad debt expense associated $807 $5,715 with gross billed revenues Total collected revenues from all sources 88,683 $443,144 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau,Telecommunications Industry Revenues (September 2010). Includes a proportionate share of amounts reported on Line 403 as surcharges or other amounts on bills identified as recovering state or federal universal service contributions. 1 - 27 Table 1.8 Revenues by Type of Carrier 1 : 2008 (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Telecommunications and Telecommunications and Interconnected VoIP Service Interconnected VoIP Service Provided for Resale 2 Provided to End Users 2 Fixed Mobile Toll Total Fixed Mobile Toll Total Local Local Regional Bell Operating Companies $23,734 $62 $160 $23,956 $44,266 $77 $2,571 $46,913 Other Incumbent Local Exchange Carriers (LECs) 8,018 68 25 8,112 9,849 415 488 10,751 Total Incumbent LECs 31,752 130 186 32,068 54,115 492 3,058 57,665 Competitive Access Providers (CAPs) and 3,888 1 1,269 5,158 11,785 38 3,999 15,822 Competitive Local Exchange Carriers (CLECs) Local Resellers 81 0 2 83 318 2 137 457 Private Service Providers 114 3 408 525 99 2 425 526 Shared-Tenant Service Providers 00 * * 29 * 11 39 Interconnected VoIP Providers 216 3 227 447 2,676 6 412 3,094 Other Local Service Providers 110 1 117 229 38 11 10 59 Total Local Competitors 4,410 9 2,023 6,442 14,945 59 4,994 19,998 Fixed Local Service Providers 36,163 138 2,208 38,509 69,060 551 8,052 77,663 Wireless Telephony Including Cellular, Personal 1,194 5,363 587 7,144 79 117,615 2,892 120,586 Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service Providers 3 10 3 16 3 403 4 410 Specialized Mobile Radio (SMR) Dispatch 9 * 0 10 * 28 1 30 Wireless Data and Other Mobile Service Providers 10 40 * 51 55 10 3 68 Wireless Service Providers 1,217 5,414 590 7,221 137 118,056 2,901 121,093 Interexchange Carriers (IXCs) 1,519 20 7,095 8,634 2,900 125 25,699 28,724 Operator Service Providers (OSPs) * 0 44 45 13 0 1,006 1,018 Prepaid Calling Card Providers 4 12 178 193 4 8 1,794 1,806 Satellite Service Providers * 4 275 279 1 23 557 581 Toll Resellers 116 17 1,811 1,943 391 65 5,857 6,313 VoIP Toll Providers 28 0 324 351 10 1 226 236 Audio Bridge Service Provider 1 * 41 42 13 26 193 231 Other Toll Carriers 53 25 1,055 1,134 41 0 1,032 1,073 All Filers $39,200 $5,629 $13,623 $58,452 $72,693 $118,855 $47,365 $238,913 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ 2/ Revenues are classified by the primary carrier type of each reporting entity. For example, revenues reported by an RBOC affiliate that identifies itself as an IXC are included in the table as IXC revenues. Many LECs provided both local and long distance services as part of package plans. Most of the revenues for the toll portion of these bundles were reported as toll revenues on FCC Form 499- A filings of LEC toll affiliates. Filers identified as Coaxial Cable Service Providers have been re-categorized as CLECs for the purpose of creating summary statistics. Telecommunications and interconnected VoIP service provided for resale consists of services provided to other contributors to federal universal service support mechanisms for resale. Revenues from services provided to firms that are de minimis or exempt from federal universal service support mechanisms are reported as end-user service revenues and are subject to contribution requirements. Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (September 2010). 1 - 28 Table 1.8 Revenues by Type of Carrier 1 : 2008 Continued (Dollar Amounts Shown in Millions) Data from FCC Form 499-A Telecommunications and Interconnected Universal VoIP Service Revenues Other Total Service Revenues 4 Billed Contribution Intrastate Interstate International Other Total Revenues Base Revenues 2 3 to international International Regional Bell Operating Companies $9,888 $45,386 $25,483 $0 * $70,869 $21,482 $92,351 Other Incumbent Local Exchange Carriers (ILECs) 2,569 11,334 7,524 0 6 18,863 4,038 22,901 Total ILECs 12,457 56,719 33,007 0 6 89,732 25,520 115,252 Competitive Access Providers (CAPs) and 4,896 13,509 6,977 5 490 20,980 9,324 30,304 Competitive Local Exchange Carriers (CLECs) Local Resellers 114 358 115 2 65 540 326 866 Private Service Providers 372 268 692 1 91 1,051 7,320 8,371 Shared-Tenant Service Providers 11 28 9 0 3 39 90 129 Interconnected VoIP Providers 1,352 1,864 1,247 1 429 3,541 13,066 16,607 Other Local Service Providers 18 100 150 0 38 288 430 718 Total Local Competitors 6,763 16,127 9,189 8 1,116 26,440 30,556 56,996 Fixed Local Service Providers 19,221 72,846 42,196 8 1,121 116,172 56,076 172,248 Wireless Telephony Including Cellular, Personal 31,375 93,233 32,829 9 1,659 127,730 53,462 181,192 Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service Providers 52 366 59 0 * 426 213 639 Specialized Mobile Radio (SMR) Dispatch 1391 0 * 40 4,550 4,590 Wireless Data and Other Mobile Service Providers 9 86 28 0 5 119 243 362 Wireless Service Providers 31,438 93,724 32,917 9 1,664 128,314 58,468 186,782 Interexchange Carriers (IXCs) 20,514 9,374 21,342 568 6,073 37,358 18,124 55,481 Operator Service Providers (OSPs) 182 813 234 5 11 1,063 164 1,227 Prepaid Calling Card Providers 1,713 99 66 24 1,810 1,999 247 2,246 Satellite Service Providers 385 41 251 152 416 860 3,741 4,601 Toll Resellers 4,319 2,226 4,099 58 1,874 8,256 3,219 11,476 VoIP Toll Provider 187 26 50 20 493 588 252 840 Audio Bridge Service Provider 191 34 157 12 70 273 10,258 10,532 Other Toll Carriers 972 193 226 6 1,782 2,207 879 3,086 All Filers $79,137 $179,573 $101,614 $862 $15,317 $297,365 $151,494 $448,859 Note: Amounts may not add to totals due to rounding. * Denotes values greater than $0 but less than $500,000. 1/ 2/ 3/ 4/ Source: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (September 2010). Carriers report non-telecommunications service revenues on Line 418. This category includes enhanced services, inside wiring maintenance, billing and collection, customer premises equipment, published directory, dark fiber, Internet, foreign carrier and other non-U.S. telecommunications service revenues. Revenues are classified by the primary carrier type of each reporting entity. For example, revenues reported by an RBOC affiliate that identifies itself as an IXC are included in the table as IXC revenues. Many LECs provided both local and long distance services as part of package plans. Most of the revenues for the toll portion of these bundles were reported as toll revenues on FCC Form 499-A filings of LEC toll affiliates. Filers identified as Coaxial Cable Service Providers have been re-categorized as CLECs for the purpose of creating summary statistics. Telecommunications and interconnected VoIP service provided for resale consists of services provided to other contributors to federal universal service support mechanisms for resale. Revenues from services provided to firms that are de minimis or exempt from federal universal service support mechanisms are reported as end-user service revenues and are subject to contribution requirements. Universal service contribution base revenues consist of all interstate and international end-user telecommunications revenues except for international-to-international revenues reported on Line 412. The totals include revenues from filers who are de minimis or otherwise exempt from contributing. This table also includes international revenues that were exempt from contribution because of the 12 percent rule. See Table 1.4 for details on exempt amounts. Contribution base amounts reported as uncollectible on Line 422 have been removed. 1 - 29 Data from FCC Form 499-Q Projected Revenues for 2008 1 Regional Bell Operating Companies 4 $10,275 $10,172 1.0 % $24,126 $47,150 $71,276 $10,162 Other Incumbent Local Exchange 2,390 2,344 1.9 7,930 10,506 18,436 2,520 Carriers (ILECs) Total ILECs 12,665 12,516 1.2 32,056 57,656 89,712 12,682 Competitive Access Providers 4,503 4,395 2.5 4,794 14,437 19,231 4,419 (CAPs) and Competitive Local Exchange Carriers (CLECs) Local Resellers 118 108 8.4 102 497 599 106 Private Service Providers 424 415 2.2 599 577 1,176 399 Shared-Tenant Service Providers 4 3 8.9 17 30 47 7 Coaxial Cable IVoIP Providers 5 Interconnected VoIP (IVoIP) Providers 5 1,272 1,219 4.2 263 2,808 3,071 1,204 Total IVoIP 5 Other Local Service Providers 107 106 2.8 127 263 391 104 Total Local Competitors 6,428 6,246 2.9 6,079 19,683 25,762 6,525 Fixed Local Service Providers 19,093 18,763 1.7 38,135 77,339 115,474 19,208 Payphone Service Providers 30 29 3.7 103 238 340 24 Wireless Telephony Including Cellular, 32,725 32,063 2.0 7,193 119,571 126,764 31,477 Personal Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service Providers 83 73 12.2 55 466 522 67 Specialized Mobile Radio (SMR) Dispatch 10 10 2.6 8 96 104 9 Wireless Data and Other Mobile Service 149 148 0.3 15 783 798 121 Providers Wireless Service Providers 32,966 32,293 2.0 7,271 120,916 128,187 31,675 Interexchange Carriers (IXCs) 21,039 20,777 1.2 11,268 28,758 40,026 21,165 Operator Service Providers (OSPs) 140 125 10.9 73 714 788 156 Prepaid Calling Card Providers 1,857 1,843 0.8 180 1,630 1,810 1,582 Satellite Service Providers 271 269 1.1 245 437 682 297 Toll Resellers 5,363 5,199 3.1 1,812 6,459 8,271 4,529 VoIP Toll Provider 5 50 41 4.8 297 248 545 223 Audio Bridge Service Provider 6 79 77 0.7 21 158 180 215 Other Toll Carriers 595 590 1.0 1,765 608 2,373 477 Toll Service Providers 29,396 28,919 1.6 15,664 39,012 54,676 28,576 All Filers $81,485 $80,004 1.8 % $61,172 $237,505 $298,678 $79,482 LIRE Exemption 7 ($4,368) 7 Total less LIRE 7 $75,636 7 See notes at end of table. Intrastate, interstate and International Historic Revenues Reported for 2008 1 Billed to Resellers 2 Implied Uncollectible Rate 3 Interstate and International Billed to End Users 2 Total Revenue 2 Billed to End Users 2 Interstate and International ($millions) Billed to End Users 2 Collected from End Users 2 3 ($millions) ($millions) Table 1.9 Carrier Telecommunications Revenues Reported on FCC Form 499-Q: 2008 (Dollar Amounts Shown in Millions) ($millions) ($millions) ($millions) 1 - 30 Data from FCC Form 499-Q Projected Revenues for 2009 1 Regional Bell Operating Companies 4 $9,226 $9,128 1.0 % $23,362 $42,608 $65,970 $9,124 Other Incumbent Local Exchange 2,475 2,428 1.9 7,840 10,130 17,970 2,441 Carriers (ILECs) Total ILECs 11,700 11,555 1.2 31,202 52,738 83,940 11,565 Competitive Access Providers 4,300 4,240 2.5 4,789 11,822 16,611 3,997 (CAPs) and Competitive Local Exchange Carriers (CLECs) Local Resellers 90 83 8.4 79 359 437 81 Private Service Providers 448 440 2.2 4,492 605 5,097 418 Shared-Tenant Service Providers 10 10 8.9 11 38 49 10 Coaxial Cable IVoIP Providers 5 Interconnected VoIP (IVoIP) Providers 5 1,364 1,340 4.2 255 3,653 3,907 1,379 Total IVoIP 5 Other Local Service Providers 15 13 2.8 179 56 235 14 Total Local Competitors 7,186 7,072 2.9 10,563 21,113 31,676 7,121 Fixed Local Service Providers 18,887 18,628 1.7 41,765 73,852 115,617 18,686 Payphone Service Providers 16 16 3.7 73 190 263 11 Wireless Telephony Including Cellular, 32,285 31,696 2.0 5,718 118,630 124,349 31,776 Personal Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service Providers 48 48 12.2 35 360 395 44 Specialized Mobile Radio (SMR) Dispatch 3 3 2.6 11 57 68 4 Wireless Data and Other Mobile Service 13 13 0.3 38 75 113 11 Providers Wireless Service Providers 32,350 31,761 2.0 5,802 119,122 124,924 31,835 Interexchange Carriers (IXCs) 18,680 18,465 1.2 8,144 24,760 32,904 17,994 Operator Service Providers (OSPs) 199 180 10.9 36 913 948 177 Prepaid Calling Card Providers 1,396 1,386 0.8 262 1,443 1,705 1,277 Satellite Service Providers 365 363 1.1 255 430 685 414 Toll Resellers 4,556 4,382 3.1 1,961 5,845 7,806 4,192 VoIP Toll Provider 5 358 336 4.8 323 361 684 337 Audio Bridge Service Provider 6 906 896 0.7 24 564 588 546 Other Toll Carriers 432 424 1.0 1,515 466 1,369 387 Toll Service Providers 26,891 26,431 1.6 12,520 34,783 47,302 25,324 All Filers $78,143 $76,835 1.8 % $60,159 $227,947 $288,107 $75,856 LIRE Exemption 7 ($3,331) 7 Total less LIRE 7 $73,505 7 See notes at end of table. Continued ($millions) Table 1.9 Carrier Telecommunications Revenues Reported on FCC Form 499-Q: 2009 (Dollar Amounts Shown in Millions) ($millions) ($millions) ($millions)($millions) Billed to End Users 2 Historic Revenues Reported for 2009 1 Billed to Resellers 2 Implied Uncollectible Rate 3 Interstate and International Billed to End Users 2 Total Revenue 2 Billed to End Users 2 Interstate and International Collected from End Users 2 3 ($millions) Intrastate, interstate and International 1 - 31 Data from FCC Form 499-Q Projected Revenues for 2010 1 Regional Bell Operating Companies 4 $8,796 $8,716 0.9 % $11,387 $19,635 $31,022 $4,501 Other Incumbent Local Exchange 2,346 2,307 1.7 3,952 4,775 8,727 1,154 Carriers (ILECs) Total ILECs 11,142 11,023 1.1 15,339 24,411 39,749 5,655 Competitive Access Providers 4,203 4,139 1.5 2,469 5,945 8,415 2,120 (CAPs) and Competitive Local Exchange Carriers (CLECs) Local Resellers 91 86 5.2 60 194 254 49 Private Service Providers 458 450 1.7 2,502 313 2,815 212 Shared-Tenant Service Providers 10 10 2.6 10 17 27 5 Coaxial Cable IVoIP Providers 5 Interconnected VoIP (IVoIP) Providers 5 1,674 1,647 1.6 207 2,298 2,505 865 Total IVoIP 5 Other Local Service Providers 14 13 1.7 84 34 118 7 Total Local Competitors 7,769 7,648 1.6 5,697 11,077 16,774 3,879 Fixed Local Service Providers 18,910 18,671 1.3 21,036 35,487 56,523 9,534 Payphone Service Providers 11 11 2.4 22 84 106 6 Wireless Telephony Including Cellular, 30,509 29,967 1.8 2,215 56,310 58,524 14,825 Personal Communications Service (PCS) and SMR Telephony Carriers Paging & Messaging Service Providers 40 40 0.7 12 154 166 20 Specialized Mobile Radio (SMR) Dispatch 7 7 0.1 8 29 37 5 Wireless Data and Other Mobile Service 14 14 0.9 31 33 64 8 Providers Wireless Service Providers 30,570 30,028 1.8 2,266 56,526 58,792 14,858 Interexchange Carriers (IXCs) 16,593 16,402 1.2 3,463 12,003 15,465 8,470 Operator Service Providers (OSPs) 164 146 10.9 10 401 411 76 Prepaid Calling Card Providers 1,199 1,182 1.4 203 736 939 541 Satellite Service Providers 386 384 0.6 162 220 382 208 Toll Resellers 4,402 4,250 3.4 881 2,794 3,675 2,036 VoIP Toll Provider 5 460 446 3.5 130 278 408 261 Audio Bridge Service Provider 6 900 885 1.6 96 498 594 484 Other Toll Carriers 597 592 1.0 597 378 508 343 Toll Service Providers 24,700 24,287 1.7 5,541 17,309 22,851 12,420 All Filers $74,192 $72,997 1.6 % $28,865 $109,406 $138,271 $36,817 LIRE Exemption 7 ($3,500) 7 Total less LIRE 7 $69,497 7 See notes on next page. ($millions) Table 1.9 Carrier Telecommunications Revenues Reported on FCC Form 499-Q: 2010 (Dollar Amounts Shown in Millions) ($millions) ($millions) ($millions)($millions) Billed to End Users 2 Collected from End Users 2 3 ($millions) Continued Intrastate, interstate and International Historic Revenues Reported for First Half 2010 1 Billed to Resellers 2 Implied Uncollectible Rate 3 Interstate and International Billed to End Users 2 Total Revenue 2 Billed to End Users 2 Interstate and International 1 - 32 Notes for Table 1.9 1/ 2/ 3/ 4/ 5/ 6/ 7/ Calendar 2008 Calendar 2009 Calendar 2010 ($millions) ($millions) ($millions) First Quarter $19,193.8 $18,871.0 $17,254.2 Second Quarter $18,978.0 $18,714.7 $16,637.9 Third Quarter $19,039.4 $18,032.8 $17,575.6 Fourth Quarter $19,011.9 $17,164.4 $17,441.4 Total Projected Collected $76,223.1 $72,783.0 $68,909.1 Data filed on FCC Forms 499-Q and 499-A Worksheets. See also: Industry Analysis and Technology Division, Wireline Competition Bureau, Telecommunications Industry Revenues (September 2010) available at http://www.fcc.gov/wcb/iatd/stats.html. In 1984, the Regional Bell Operating Companies (RBOCs) consisted of Ameritech, Bell Atlantic, Bell South, NYNEX, Pacific Telesis, Southwestern Bell and US West. As a result of mergers, the RBOCs are now AT&T, Qwest, and Verizon. Where operations were sold to other carriers, subsequent revenues are included with ILEC revenues. Prior to the fourth quarter of 2008, a few audio bridging (teleconferencing) service providers reported their revenues as telecommunications. Starting with the fourth quarter of 2008, all audio bridging service revenues must be reported as telecommunications. See Request for Review by InterCall, Inc. of Decision of the Universal Service Administrator, CC Docket No. 96-45, Order, 23 FCC Rcd 10731(2008). providers reported their revenues as telecommunications. Starting with Q4 of 2008, all audio bridging service revenues must be reported as telecommunications. (actual customers) and to firms that are de minimis or otherwise exempt from federal universal service support mechanisms are reported as end-user revenue. The filer category Coaxial Cable was added to the 2004 FCC Form 499-A. The category interconnected Voice over Internet Protocol (“Interconnected VoIP”) was added to the revised 2006 FCC Form 499-A, dated August 2006. By 2009, most firms that self identified as Coaxial Cable reported that most of their local service revenues were derived from interconnected VoIP service. Information from recent FCC Form 477 filings, FCC Form 499-A filings, and company websites have been used to reclassify companies so that interconnected VoIP providers that operate using their own coaxial cable TV facilities are classified as “Coaxial Cable”. Filers that self identified as interconnected VoIP but reported only toll revenue on their FCC Form 499-A filings have been reclassified as “VoIP Toll”. Note that many filers that self identified as incumbent local exchange carriers (ILECs) or competitive local exchange carriers (CLECs) also reported interconnected VoIP revenues. The quarterly revenues reported by these entities are included with ILEC and CLEC revenues, not with interconnected VoIP provider revenues in these tables. Prior to Q4 of 2008, a few audio bridging (teleconferencing) service Sources: The amounts actually used to calculate contribution factors are shown below. These amounts total less than the total projected collected revenues shown in the table. One reason is that amounts in the table reflect all amounts shown in the FCC Form 499-Q data base, including estimated amounts for non-filers and amounts reported by filers that are de minimis or do not contribute because they provide only international services. In addition, filers are not required to contribute on international revenues if their interstate end-user revenues represent less than 12% of their combined interstate and international end-user revenues -- a test referred to as the Limited International Revenue Exemption (LIRE) or the "12%" rule. In addition, the totals shown above include estimated amounts for some carriers. Finally, some difference may be explained by late filings and corrections made to the data base after the Commission calculated contribution factors. Contribution bases used to calculate factors Note: Amounts may not add to totals due to rounding. Each quarter, telecommunications providers that are required to contribute to universal service support mechanisms must to file an FCC Form 499-Q. The FCC Form 499-Q collects total, interstate and international billed revenues for the most recently completed calendar quarter (historic revenues) and also collects projected interstate and international -- but not total -- revenues for the upcomming calendar quarter (projected revenues.) Some telecommunications providers file the form even though they are not required to contribute. USAC estimates revenues for most non-filers. In order to avoid double assessment, the FCC Form 499-Q distinguishes between revenues for U.S telecommunications and interconnected VoIP service provided for resale, commonly called "carrier's carrier" revenues, and USF assessable contribution base revenues, commonly called "end-user revenues." Services provided for resale consist of U.S. telecommunications and interconnected VoIP service provided to another contributing filer for resale as U.S. telecommunications or interconnected VoIP service. Revenues from telecommunications and interconnected VoIP service provided to non-filers Filers contribute to USF based on the interstate and international telecommunications revenues that they collect from end users. On the FCC Form 499-Q, filers report interstate and international billed end-user historical revenues for the most recently completed quarter. Filers also project the amount of contribution base (i.e. interstate and international end-user revenue) they expect to bill in the upcoming quarter and how much of this billed amount they expect to collect. The difference between projected billed revenues and projected collected revenues is the implied uncollectible amount. Projected collected end-user interstate and international revenues form the USF contribution base. (For example, the May 2010 filings contain historic revenue data for the Q1of 2010 and projected revenue data for Q3 of 2010.) Filers report actual billed and uncollectible amounts in their FCC Form 499-A filings. This information is used to true-up contributions. This table does not include revenue from “international-to-international” telephone calls, which are defined as U.S. telecom calls that traverse U.S. territory but both originate and terminate in foreign points. Such revenues are exempt from universal service contribution and therefore are not included with historical assessable end-user telecommunications revenues on Line 116 of the FCC Form 499-Q, or with projected gross billed or projected collected revenues on Line 119 or Line 120, respectively. International-to-international revenues are included with Line 117 - (all other goods and services) and Line 118 - (gross-billed revenues from all sources), but these lines are not summarized in the tables herein. International-to-international revenues are included with end-user telecommunications revenues on Line 412 of the FCC Form 499-A and are included in contribution bases for telecommunications relay service, local number portability, and number administration. 1 - 33 Universal Service Program Requirements and Contribution Factors for 2009 (Dollar Amounts Shown in Millions) First Second Third Fourth Full Quarter Quarter Quarter Quarter Year All Support Mechanisms Projections of demand and administrative expenses at the time the contribution factors were adopted High Cost High-Cost Loop Support $362.640 $371.250 $367.890 $369.040 $1,470.820 Local Switching Support $109.370 $110.230 $109.790 $109.230 $438.620 Interstate Common Line Support $355.290 $359.400 $435.120 $435.340 $1,585.150 Interstate Access Support Mechanism $145.420 $143.070 $139.720 $149.650 $577.860 Forward-Looking High Cost Mechanism $84.120 $84.150 $82.060 $82.070 $332.400 Prior Period True-ups -$174.720 -$11.190 $22.220 -$107.760 -$271.450 Administrative expenses $17.000 $22.040 $19.060 $9.500 $67.600 Interest income 1 -$2.010 -$1.500 -$0.750 -$0.460 -$4.720 Sprint & Verizon Wireless Phase Down Recovery 2 -$75.910 -$75.910 Program Total $897.110 $1,077.450 $1,175.110 $970.700 $4,120.370 Low Income Lifeline Assistance $192.630 $193.060 $214.920 $247.650 $848.260 Link-Up $10.050 $9.290 $9.040 $11.460 $39.840 Incremental Toll Limitation $2.210 $2.190 $1.770 $2.630 $8.800 Prior Period true-ups -$20.080 -$5.980 $9.090 $28.250 $11.280 Administrative expenses $1.980 $2.940 $3.240 -$2.130 $6.030 Interest income 1 -$0.760 -$0.570 -$0.330 -$0.190 -$1.850 Program Total $186.030 $200.930 $237.730 $287.670 $912.360 Rural Health Rural Health Care Support $49.490 $49.410 $54.150 $53.410 $206.460 Prior Period True-ups -$21.390 $14.220 $0.100 $0.090 -$6.980 Administrative expenses $4.790 $4.800 $4.100 -$3.210 $10.480 Interest income 1 -$1.080 -$0.940 -$0.640 -$0.440 -$3.100 Program Total $31.810 $67.490 $57.710 $49.850 $206.860 Schools and Libraries Schools and Libraries Support $562.500 $562.500 $562.500 $562.500 $2,250.000 Prior Period True-ups 3 -$46.150 -$9.800 $5.960 -$3.310 -$53.300 Administrative expenses $36.760 $30.690 $20.340 $87.790 Interest income 1 -$21.100 -$15.630 -$10.060 -$6.660 -$53.450 Program Total $532.010 $537.070 $589.090 $572.870 $2,231.040 Grand Total $1,646.960 $1,882.940 $2,059.640 $1,881.090 $7,470.630 Applicable interstate and international end-user revenues Reported contribution base revenues $18,871.047 $18,714.716 $18,032.832 $17,164.439 Circularity Adjustment Amount carriers will contribute to USF in this quarter. -$1,610.200 -$1,882.940 -$2,028.950 -$1,860.750 Subtotal $17,260.847 $16,831.776 $16,003.882 $15,303.689 Adjustment factor for uncollectibles 1.00% 1.00% 1.00% 1.00% Contribution base at the time the factor was calculated $17,088.239 $16,663.458 $15,843.843 $15,150.652 Contribution factor 9.5% 11.3% 12.9% 12.3% Contribution factor times contribution base $1,623.383 $1,882.971 $2,043.856 $1,863.530 Source: Appendix M02 from pertinent filings as shown at http://www.usac.org/about/governance/fcc-filings/2009/ 1 Interest income is shown as negative because it is subtracted from expenses to yield the total 3 For the schools and libraries mechanism, periodic true-ups include applications of unused fund balance from prior periods. Table 1.10 2 The recovery of support for Sprint and Verizon Wireless is consistent with the support phase-down discussion whereby USAC recovers 20% of CETC support over five years until such time Sprint and Verizon Wireless no longer receive any High Cost support. A discussion of the support phase-downs can be found in DA 08-258 and DA 08-259 released in November 2008. More information can be found in WC 05-337 Released September 2010. 1 - 34 Universal Service Program Requirements and Contribution Factors for 2010 (Dollar Amounts Shown in Millions) First Second Third Fourth Full Quarter Quarter Quarter Quarter Year All Support Mechanisms Projections of demand and administrative expenses at the time the contribution factors were adopted High Cost High Cost Loop Support $358.960 $366.880 $372.500 $369.780 $1,468.120 Local Switching Support $96.490 $98.220 $99.530 $104.220 $398.460 Interstate Common Line Support $425.620 $431.950 $450.400 $451.660 $1,759.630 Interstate Access Support Mechanism $144.820 $142.530 $144.480 $153.370 $585.200 Forward-Looking High Cost Mechanism $80.420 $79.990 $81.380 $81.580 $323.370 Prior Period True-ups $23.660 $90.560 $25.000 -$34.930 $104.290 Administrative expenses $7.610 $7.850 $7.480 $1.990 $24.930 Interest income 1 -$0.260 -$0.140 -$0.040 -$0.120 -$0.560 Sprint & Verizon Wireless Phase Down Recovery 2 -$39.210 -$39.210 -$39.210 -$39.210 -$156.840 Program Total $1,098.110 $1,178.630 $1,141.520 $1,088.340 $4,506.600 Low Income Lifeline Assistance $291.410 $332.080 $334.920 $336.280 $1,294.690 Link-Up $15.050 $21.630 $18.570 $18.240 $73.490 Incremental Toll Limitation $3.510 $4.510 $5.720 $7.140 $20.880 Prior Period true-ups $45.230 $26.570 -$14.170 -$49.750 $7.880 Administrative expenses $1.100 $1.480 $1.700 -$0.090 $4.190 Interest income 1 -$0.050 -$0.020 -$0.030 -$0.090 -$0.190 Program Total $356.250 $386.250 $346.710 $311.730 $1,400.940 Rural Health Rural Health Care Support $51.760 $52.380 $33.080 $15.670 $152.890 Prior Period True-ups $3.170 $0.120 -$0.880 -$0.950 $1.460 Administrative expenses $2.590 $2.820 $3.590 $2.350 $11.350 Interest income 1 -$0.310 -$0.330 -$0.310 -$0.420 -$1.370 Program Total $57.210 $54.990 $35.480 $16.650 $164.330 Schools & Libraries Schools and Libraries Support $562.500 $562.500 $562.500 $562.500 $2,250.000 Prior Period True-ups 3 $36.480 $1.540 -$3.350 -$6.940 $27.730 Administrative expenses $18.190 $18.920 $23.140 $9.510 $69.760 Interest income 1 -$4.010 -$3.540 -$3.040 -$3.360 -$13.950 Program Total $613.160 $579.420 $579.250 $561.710 $2,333.540 Grand Total $2,124.730 $2,199.290 $2,102.960 $1,978.430 $8,405.410 Applicable interstate and international end-user revenues Reported contribution base revenues $17,254.235 $16,637.880 $17,575.565 $17,441.382 Circularity Adjustment Amount carriers will contribute to USF in this quarter. -$2,106.540 -$2,180.370 -$2,079.820 -$1,968.920 Subtotal $15,147.695 $14,457.510 $15,495.745 $15,472.462 Adjustment factor for uncollectibles 1.00% 1.00% 1.00% 1.00% Contribution base at the time the factor was calculated $14,996.218 $14,312.935 $15,340.788 $15,317.737 Contribution factor 14.1% 15.3% 13.6% 12.9% Contribution factor times contribution base $2,114.467 $2,189.879 $2,086.347 $1,975.988 Source: Appendix M02 from pertinent filings as shown at http://www.usac.org/about/governance/fcc-filings/2010/ 1 Interest income is shown as negative because it is subtracted from expenses to yield the total 3 For the schools & libraries mechanism, periodic true-ups include applications of unused fund balance from prior periods. Table 1.10 2 The recovery of support for Sprint and Verizon Wireless is consistent with the support phase-down discussion whereby USAC recovers 20% of CETC support over five years until such time Sprint and Verizon Wireless no longer receive any High Cost support. A discussion of the support phase-downs can be found in DA 08-258 and DA 08-259 released in November 2008. More information can be found in WC 05-337 Released September 2010. 1 - 35 Mechanism Percent of Total Percent of Total High-Cost Support $4,478 63.0 % $4,292 59.1 % High-Cost Loop Support 1,457 20.5 1,424 19.6 Safety Net Additive Support 48 0.7 53 0.7 Safety-Valve 2 0.0 5 0.1 High-Cost Model Support 351 4.9 331 4.6 Interstate Common Line Support 1,621 22.8 1,537 21.2 Interstate Access Support 585 8.2 563 7.8 Local Switching Support 416 5.9 381 5.2 Low-Income Support 819 11.5 1,025 14.1 School and Libraries 1,760 24.8 1,878 25.9 Rural Health Care 49 0.7 61 0.8 All Universal Service Support $7,106 100.0 % $7,256 100.0 % Table 1.11 Universal Service Support Mechanisms: 2008 & 2009 (Dollars in Millions) Source: Universal Service Administration Company (USAC). Disbursements 2008 2009 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 the respective calendar year (2008 or 2009). In Sections 4 and 5, figures for the Schools and Libraries program and the Rural Health Care program are reported based on fiscal year rather than calendar year. Disbursements Distribution of Universal Service Payments: 2009 Chart 1.1 Low Income 14.1% High Cost 59.1% Rural Health Care 0.8% Schools & Libraries 25.9% 1 - 36 (Annual Payments and Contributions in Thousands) Payments from USF to Service Providers 1 State or Jurisdiction High-Cost Support Low-Income Support Schools & Libraries Rural Health Care Amount % of Total Amount % of Total Alabama $100,061 $25,652 $28,922 $229 $154,864 2.13% $118,935 1.60% $35,929 Alaska 168,272 24,480 22,542 29,122 244,417 3.37% 19,511 0.26% 224,906 American Samoa 3,939 39 4,282 141 8,400 0.12% 516 0.01% 7,885 Arizona 67,204 21,813 49,278 1,954 140,249 1.93% 146,289 1.97% -6,040 Arkansas 148,253 4,019 14,974 401 167,647 2.31% 68,063 0.91% 99,584 California 107,508 194,238 281,161 942 583,849 8.05% 822,527 11.05% -238,678 Colorado 79,397 2,905 14,452 234 96,989 1.34% 132,967 1.79% -35,979 Connecticut -390 5,389 22,255 0 27,253 0.38% 99,000 1.33% -71,746 Delaware 226 661 831 0 1,719 0.02% 27,334 0.37% -25,615 Dist. of Columbia 0 1,077 8,440 0 9,518 0.13% 34,291 0.46% -24,773 Florida 70,396 74,720 75,933 854 221,903 3.06% 495,839 6.66% -273,936 Georgia 136,139 33,514 67,875 1,989 239,517 3.30% 243,770 3.27% -4,253 Guam 16,650 307 334 101 17,392 0.24% 3,904 0.05% 13,488 Hawaii 58,416 495 1,930 196 61,037 0.84% 36,936 0.50% 24,101 Idaho 50,779 3,603 4,750 257 59,389 0.82% 37,003 0.50% 22,386 Illinois 74,939 13,649 63,987 1,389 153,964 2.12% 307,767 4.13% -153,803 Indiana 74,418 4,917 22,702 822 102,858 1.42% 145,484 1.95% -42,626 Iowa 127,435 4,314 9,899 571 142,218 1.96% 67,353 0.90% 74,865 Kansas 230,301 3,128 15,278 327 249,034 3.43% 65,855 0.88% 183,179 Kentucky 101,805 9,802 28,136 708 140,451 1.94% 97,031 1.30% 43,420 Louisiana 156,494 12,011 35,427 40 203,972 2.81% 106,388 1.43% 97,584 Maine 27,443 6,798 6,159 63 40,463 0.56% 31,580 0.42% 8,883 Maryland 3,966 858 9,850 0 14,673 0.20% 163,148 2.19% -148,475 Massachusetts 2,413 21,043 22,729 150 46,335 0.64% 169,539 2.28% -123,204 Michigan 63,193 30,329 51,300 941 145,763 2.01% 212,378 2.85% -66,615 Minnesota 127,037 7,043 17,168 2,637 153,885 2.12% 118,125 1.59% 35,760 Mississippi 281,267 9,880 29,982 148 321,278 4.43% 66,750 0.90% 254,528 Missouri 108,639 8,198 26,168 578 143,583 1.98% 143,845 1.93% -262 Montana 79,855 3,875 4,201 843 88,774 1.22% 25,215 0.34% 63,560 Nebraska 116,611 2,157 9,004 1,391 129,163 1.78% 41,711 0.56% 87,452 Nevada 25,570 2,906 4,295 73 32,845 0.45% 69,280 0.93% -36,435 New Hampshire 8,576 746 2,285 11 11,617 0.16% 36,248 0.49% -24,631 New Jersey 1,058 15,053 37,106 0 53,218 0.73% 248,888 3.34% -195,671 New Mexico 71,391 14,595 26,912 386 113,284 1.56% 48,248 0.65% 65,036 New York 44,967 60,082 237,857 62 342,968 4.73% 480,589 6.46% -137,621 North Carolina 85,635 33,899 57,744 312 177,591 2.45% 225,632 3.03% -48,041 North Dakota 94,452 3,101 3,560 1,201 102,314 1.41% 16,438 0.22% 85,877 Northern Mariana Is. 1,309 168 1,142 0 2,619 0.04% 806 0.01% 1,813 Ohio 33,858 36,707 63,578 426 134,569 1.85% 259,335 3.48% -124,767 Oklahoma 142,547 71,141 35,314 809 249,812 3.44% 78,444 1.05% 171,368 Oregon 78,826 5,413 15,057 312 99,608 1.37% 89,978 1.21% 9,629 Pennsylvania 57,770 21,603 69,524 109 149,006 2.05% 307,789 4.13% -158,783 Puerto Rico 74,387 28,854 8,735 0 111,977 1.54% 69,074 0.93% 42,902 Rhode Island 34 3,425 5,466 0 8,925 0.12% 24,456 0.33% -15,531 South Carolina 98,376 9,629 37,412 47 145,463 2.00% 110,601 1.49% 34,863 South Dakota 97,338 3,334 5,536 1,388 107,595 1.48% 19,168 0.26% 88,427 Tennessee 58,896 31,349 49,110 242 139,598 1.92% 157,946 2.12% -18,349 Texas 262,049 101,914 155,009 889 519,860 7.16% 518,620 6.97% 1,241 Utah 19,221 3,808 15,628 666 39,323 0.54% 55,550 0.75% -16,226 Vermont 21,208 2,576 1,382 115 25,282 0.35% 18,062 0.24% 7,220 Virgin Islands 15,986 77 2,014 74 18,152 0.25% 5,136 0.07% 13,016 Virginia 72,933 15,198 29,056 731 117,918 1.63% 209,307 2.81% -91,389 Washington 94,459 17,704 27,850 80 140,092 1.93% 155,701 2.09% -15,609 West Virginia 58,640 1,189 10,647 308 70,784 0.98% 49,119 0.66% 21,665 Wisconsin 139,287 9,341 22,569 5,281 176,478 2.43% 125,210 1.68% 51,268 Wyoming 50,740 469 3,559 148 54,917 0.76% 15,103 0.20% 39,813 Total $4,292,180 $1,025,194 $1,878,295 $60,698 $7,256,367 100.00% $7,443,781 100.00% -$187,414 2 Estimated contributions include administrative cost of approximately $187 million, as shown in USAC's Annual Report. Allocations of contributions among states is an FCC staff estimate. 3 Net dollar flow is positive when payments from USF to carriers exceed contributions to USF. Total is negative because of administrative expenses. 1 Data from USAC's Annual Report. Table 1.12 Universal Service Support Mechanisms by State: 2009 Estimated Net Dollar Flow 3 Notes: Figures may not add due to rounding. Support payments do not include quarterly true-ups. USF is an abbreviation for the Universal Service Fund. Estimated Contributions 2 Total 1 - 37 Table 1.13 End-User Telecommunications Revenues by State: 2008 (Dollar Amounts Shown in Millions) Intrastate Interstate and International Total % of Total Alabama $2,321 $1,297 $3,618 1.51% Alaska 331 213 544 0.23 American Samoa 12 6 17 0.01 Arizona 2,953 1,595 4,548 1.90 Arkansas 1,395 742 2,137 0.89 California 20,136 8,970 29,105 12.18 Colorado 2,548 1,450 3,998 1.67 Connecticut 1,945 1,080 3,024 1.27 Delaware 496 298 794 0.33 District of Columbia 769 374 1,143 0.48 Florida 9,849 5,407 15,256 6.39 Georgia 4,821 2,658 7,480 3.13 Guam 62 43 104 0.04 Hawaii 652 403 1,055 0.44 Idaho 700 404 1,103 0.46 Illinois 6,675 3,356 10,032 4.20 Indiana 3,035 1,587 4,621 1.93 Iowa 1,392 735 2,127 0.89 Kansas 1,371 718 2,089 0.87 Kentucky 2,000 1,058 3,058 1.28 Louisiana 2,265 1,160 3,426 1.43 Maine 659 344 1,004 0.42 Maryland 3,284 1,779 5,063 2.12 Massachusetts 3,598 1,849 5,447 2.28 Michigan 4,813 2,316 7,129 2.98 Minnesota 2,607 1,288 3,895 1.63 Mississippi 1,293 728 2,021 0.85 Missouri 2,984 1,569 4,552 1.91 Montana 463 275 738 0.31 Nebraska 865 455 1,320 0.55 Nevada 1,373 756 2,129 0.89 New Hampshire 693 395 1,088 0.46 New Jersey 5,059 2,714 7,773 3.25 New Mexico 928 526 1,454 0.61 New York 10,443 5,241 15,684 6.56 North Carolina 4,568 2,461 7,028 2.94 North Dakota 333 179 512 0.21 N. Mariana Islands 13 9 22 0.01 Ohio 5,718 2,828 8,546 3.58 Oklahoma 1,698 855 2,554 1.07 Oregon 1,825 981 2,806 1.17 Pennsylvania 6,549 3,357 9,905 4.15 Puerto Rico 1,286 753 2,039 0.85 Rhode Island 534 267 801 0.34 South Carolina 2,157 1,206 3,363 1.41 South Dakota 371 209 580 0.24 Tennessee 3,328 1,722 5,050 2.11 Texas 11,829 5,656 17,485 7.32 Utah 1,155 606 1,761 0.74 Vermont 317 197 514 0.22 Virgin Islands 64 56 120 0.05 Virginia 4,126 2,283 6,409 2.68 Washington 3,328 1,698 5,026 2.10 West Virginia 824 536 1,359 0.57 Wisconsin 2,651 1,365 4,016 1.68 Wyoming 273 165 437 0.18 Total $157,737 $81,176 $238,913 100.00% Note: Figures may not add to totals due to rounding. 1 - 38 Intrastate Interstate and International Total ILECs $45,066 $12,599 $57,665 CLECs and interconnected VoIP Providers 13,125 6,873 19,998 Payphone Providers 158 16 174 Wireless Carriers 89,091 32,003 121,094 Toll Carriers 10,297 29,685 39,982 Total $157,737 $81,176 $238,913 End-User Telecommunication Revenue by Providers: 2008 (In Millions) Table 1.14 Source: Table 6 of Industry Analysis and Technolgy Division, Wireline Competition Bureau, Telecommunications Industry Revenues: 2008 (September 2010) 1 - 39 Table 1.15 Intrastate End-User Telecommunications Revenues by Provider: 2008 (Dollar Amounts Shown in Millions) % of Total Alabama $673 $138 $2 $1,354 $154 $2,321 1.47% Alaska 106 33 1 167 24 331 0.21 American Samoa 4 0 0 7 1 12 0.01 Arizona 703 365 5 1,719 161 2,953 1.87 Arkansas 387 67 1 852 88 1,395 0.88 California 6,202 1,361 26 11,130 1,417 20,136 12.77 Colorado 714 251 3 1,417 163 2,548 1.62 Connecticut 590 187 1 1,031 135 1,945 1.23 Delaware 143 49 0 270 33 496 0.31 District of Columbia 285 54 0 365 65 769 0.49 Florida 2,869 807 10 5,508 655 9,849 6.24 Georgia 1,329 347 5 2,837 304 4,821 3.06 Guam 22 8 0 25 5 62 0.04 Hawaii 187 34 0 389 43 652 0.41 Idaho 220 37 1 392 50 700 0.44 Illinois 2,012 494 6 3,705 460 6,675 4.23 Indiana 964 168 3 1,680 220 3,035 1.92 Iowa 420 92 2 782 96 1,392 0.88 Kansas 353 125 1 810 81 1,371 0.87 Kentucky 558 148 2 1,165 127 2,000 1.27 Louisiana 618 146 2 1,357 141 2,265 1.44 Maine 209 63 0 339 48 659 0.42 Maryland 1,010 256 2 1,785 231 3,284 2.08 Massachusetts 944 477 2 1,959 216 3,598 2.28 Michigan 1,345 432 4 2,725 307 4,813 3.05 Minnesota 726 262 3 1,451 166 2,607 1.65 Mississippi 368 55 2 785 84 1,293 0.82 Missouri 929 156 2 1,684 212 2,984 1.89 Montana 147 30 1 252 34 463 0.29 Nebraska 219 90 1 506 50 865 0.55 Nevada 377 124 3 784 86 1,373 0.87 New Hampshire 184 103 0 364 42 693 0.44 New Jersey 1,424 577 3 2,729 325 5,059 3.21 New Mexico 283 36 2 542 65 928 0.59 New York 2,496 1,353 11 6,013 570 10,443 6.62 North Carolina 1,344 325 4 2,588 307 4,568 2.90 North Dakota 90 34 0 188 20 333 0.21 N. Mariana Islands 6 0 0 6 1 13 0.01 Ohio 1,641 439 4 3,260 375 5,718 3.63 Oklahoma 458 156 2 978 105 1,698 1.08 Oregon 491 171 3 1,047 112 1,825 1.16 Pennsylvania 1,987 656 5 3,447 454 6,549 4.15 Puerto Rico 284 63 2 872 65 1,286 0.82 Rhode Island 109 95 1 304 25 534 0.34 South Carolina 625 142 3 1,245 143 2,157 1.37 South Dakota 94 42 0 213 22 371 0.24 Tennessee 881 225 3 2,017 201 3,328 2.11 Texas 3,262 705 13 7,103 745 11,829 7.50 Utah 293 81 1 713 67 1,155 0.73 Vermont 117 27 0 147 27 317 0.20 Virgin Islands 23 0 0 36 5 64 0.04 Virginia 1,237 428 3 2,175 283 4,126 2.62 Washington 907 306 5 1,902 207 3,328 2.11 West Virginia 272 58 0 430 62 824 0.52 Wisconsin 845 230 2 1,382 193 2,651 1.68 Wyoming 79 16 1 159 18 273 0.17 Total $45,066 $13,125 $158 $89,091 $10,297 $157,737 100.00% Note: Figures may not add to totals due to rounding. TotalILECs CLECs and interconnected VoIP Providers Payphone Providers Wireless Carriers Toll Carriers 1 - 40 Table 1.16 Interstate and International End-User Telecommunications Revenues by Provider: 2008 (Dollar Amounts Shown in Millions) % of Total Alabama $215 $72 $0 $486 $523 $1,297 1.60% Alaska 39 17 0 60 96 213 0.26 American Samoa 1 0 0 2 2 6 0.01 Arizona 216 191 1 618 570 1,595 1.97 Arkansas 110 35 0 306 291 742 0.91 California 1,300 713 3 3,998 2,957 8,970 11.05 Colorado 234 132 0 509 575 1,450 1.79 Connecticut 160 98 0 370 451 1,080 1.33 Delaware 44 26 0 97 131 298 0.37 District of Columbia 53 29 0 131 162 374 0.46 Florida 914 423 1 1,978 2,091 5,407 6.66 Georgia 423 182 1 1,019 1,034 2,658 3.27 Guam 8 4 0 9 21 43 0.05 Hawaii 64 18 0 140 181 403 0.50 Idaho 69 19 0 141 175 404 0.50 Illinois 478 259 1 1,331 1,288 3,356 4.13 Indiana 287 88 0 604 607 1,587 1.95 Iowa 112 48 0 281 293 735 0.90 Kansas 97 66 0 291 265 718 0.88 Kentucky 177 77 0 418 385 1,058 1.30 Louisiana 196 77 0 488 400 1,160 1.43 Maine 58 33 0 122 131 344 0.42 Maryland 277 134 0 641 727 1,779 2.19 Massachusetts 282 250 0 704 613 1,849 2.28 Michigan 365 226 0 979 746 2,316 2.85 Minnesota 195 137 0 521 435 1,288 1.59 Mississippi 114 29 0 282 304 728 0.90 Missouri 254 82 0 605 628 1,569 1.93 Montana 52 16 0 90 117 275 0.34 Nebraska 57 47 0 182 169 455 0.56 Nevada 82 65 0 281 327 756 0.93 New Hampshire 56 54 0 131 155 395 0.49 New Jersey 421 302 0 980 1,010 2,714 3.34 New Mexico 96 19 0 195 216 526 0.65 New York 755 709 1 2,160 1,616 5,241 6.46 North Carolina 411 170 0 930 949 2,461 3.03 North Dakota 29 18 0 68 64 179 0.22 N. Mariana Islands 2 0 0 2 4 9 0.01 Ohio 435 230 0 1,171 992 2,828 3.48 Oklahoma 123 82 0 351 299 855 1.05 Oregon 159 90 0 376 356 981 1.21 Pennsylvania 581 343 0 1,238 1,193 3,357 4.13 Puerto Rico 85 33 0 313 322 753 0.93 Rhode Island 31 50 0 109 77 267 0.33 South Carolina 201 74 0 447 484 1,206 1.49 South Dakota 31 22 0 76 80 209 0.26 Tennessee 273 118 0 725 607 1,722 2.12 Texas 835 369 1 2,552 1,898 5,656 6.97 Utah 89 42 0 256 218 606 0.75 Vermont 34 14 0 53 97 197 0.24 Virgin Islands 8 0 0 13 35 56 0.07 Virginia 378 224 0 781 899 2,283 2.81 Washington 273 160 1 683 581 1,698 2.09 West Virginia 91 31 0 155 260 536 0.66 Wisconsin 240 120 0 496 508 1,365 1.68 Wyoming 29 8 0 57 70 165 0.20 Total $12,599 $6,873 $16 $32,003 $29,685 $81,176 100.00% Note: Figures may not add to totals due to rounding. Total Toll CarriersILECs CLECs and interconnected VoIP Providers Payphone Providers Wireless Carriers 1 - 41 Table 1.17 Data Used to Allocate Nationwide Revenue to States (Lines/Subscribers/Minutes Shown in Thousands) ILEC End-User Switched Access Lines: June 2008 Percent of Total Non-ILEC End- User Switched Access Lines and VoIP Subscriptions: December 2008 1 Percent of Total Number of Independent Payphones: March 2008 2 Percent of Total Wireless Subscribers: June 2009 3 Percent of Total Interstate Access Minutes: 2009 Percent of Total Alabama 1,861 1.49% 460 1.05% 6 1.48% 3,887 1.52% 5,561,528 1.76% Alaska 294 0.24 109 0.25 2 0.43 480 0.19 1,025,583 0.32 American Samoa 11 0.01 0 0.00 0 0.02 20 0.01 19,087 0.01 Arizona 1,943 1.56 1,218 2.78 13 3.26 4,936 1.93 6,058,782 1.92 Arkansas 1,069 0.86 223 0.51 2 0.58 2,446 0.96 3,098,534 0.98 California 17,149 13.76 4,536 10.37 66 16.36 31,946 12.49 31,440,776 9.96 Colorado 1,973 1.58 838 1.91 8 2.02 4,066 1.59 6,116,346 1.94 Connecticut 1,632 1.31 625 1.43 3 0.68 2,959 1.16 4,795,494 1.52 Delaware 396 0.32 164 0.37 1 0.25 775 0.30 1,391,815 0.44 District of Columbia 788 0.63 182 0.42 0 0.12 1,047 0.41 1,719,594 0.54 Florida 7,932 6.37 2,690 6.15 25 6.25 15,809 6.18 22,233,772 7.04 Georgia 3,675 2.95 1,157 2.65 13 3.21 8,142 3.18 10,993,228 3.48 Guam 62 0.05 28 0.06 0 0.06 73 0.03 221,235 0.07 Hawaii 516 0.41 114 0.26 0 0.11 1,115 0.44 1,927,442 0.61 Idaho 609 0.49 122 0.28 2 0.42 1,125 0.44 1,860,296 0.59 Illinois 5,562 4.46 1,646 3.76 14 3.50 10,634 4.16 13,700,941 4.34 Indiana 2,665 2.14 559 1.28 7 1.63 4,824 1.89 6,458,622 2.05 Iowa 1,162 0.93 307 0.70 4 1.01 2,245 0.88 3,119,960 0.99 Kansas 977 0.78 417 0.95 3 0.68 2,326 0.91 2,815,818 0.89 Kentucky 1,542 1.24 493 1.13 6 1.38 3,343 1.31 4,092,197 1.30 Louisiana 1,710 1.37 488 1.11 6 1.50 3,896 1.52 4,249,605 1.35 Maine 579 0.46 211 0.48 1 0.14 972 0.38 1,393,823 0.44 Maryland 2,792 2.24 854 1.95 4 1.04 5,124 2.00 7,729,202 2.45 Massachusetts 2,609 2.09 1,590 3.63 6 1.55 5,624 2.20 6,513,904 2.06 Michigan 3,719 2.98 1,442 3.29 10 2.39 7,821 3.06 7,930,336 2.51 Minnesota 2,006 1.61 873 1.99 7 1.68 4,164 1.63 4,623,973 1.46 Mississippi 1,018 0.82 182 0.42 4 0.99 2,252 0.88 3,229,711 1.02 Missouri 2,568 2.06 519 1.19 6 1.42 4,835 1.89 6,674,043 2.11 Montana 406 0.33 101 0.23 2 0.40 723 0.28 1,244,348 0.39 Nebraska 606 0.49 298 0.68 2 0.58 1,451 0.57 1,795,825 0.57 Nevada 1,042 0.84 414 0.95 6 1.58 2,249 0.88 3,474,657 1.10 New Hampshire 507 0.41 343 0.78 1 0.26 1,045 0.41 1,648,777 0.52 New Jersey 3,936 3.16 1,925 4.40 9 2.16 7,834 3.06 10,742,402 3.40 New Mexico 783 0.63 121 0.28 4 1.09 1,555 0.61 2,296,789 0.73 New York 6,902 5.54 4,511 10.31 27 6.76 17,260 6.75 17,184,397 5.44 North Carolina 3,715 2.98 1,084 2.48 11 2.83 7,428 2.90 10,089,963 3.20 North Dakota 248 0.20 113 0.26 1 0.16 541 0.21 685,008 0.22 N. Mariana Islands 18 0.01 0 0.00 0 0.02 16 0.01 47,594 0.02 Ohio 4,537 3.64 1,463 3.34 10 2.39 9,357 3.66 10,548,312 3.34 Oklahoma 1,267 1.02 519 1.19 4 0.99 2,808 1.10 3,184,449 1.01 Oregon 1,359 1.09 571 1.30 7 1.81 3,007 1.18 3,785,895 1.20 Pennsylvania 5,494 4.41 2,186 5.00 12 2.93 9,895 3.87 12,685,420 4.02 Puerto Rico 786 0.63 210 0.48 5 1.26 2,502 0.98 3,426,206 1.09 Rhode Island 302 0.24 316 0.72 1 0.33 874 0.34 814,300 0.26 South Carolina 1,728 1.39 472 1.08 7 1.75 3,573 1.40 5,142,939 1.63 South Dakota 261 0.21 140 0.32 1 0.30 611 0.24 848,210 0.27 Tennessee 2,436 1.95 751 1.72 8 2.09 5,791 2.26 6,452,823 2.04 Texas 9,020 7.24 2,349 5.37 33 8.17 20,390 7.97 20,183,770 6.39 Utah 811 0.65 269 0.62 4 0.90 2,046 0.80 2,323,130 0.74 Vermont 323 0.26 88 0.20 0 0.06 421 0.16 1,027,573 0.33 Virgin Islands 62 0.05 0 0.00 0 0.04 104 0.04 372,199 0.12 Virginia 3,422 2.75 1,427 3.26 8 1.97 6,242 2.44 9,559,980 3.03 Washington 2,509 2.01 1,020 2.33 13 3.23 5,461 2.14 6,174,868 1.96 West Virginia 752 0.60 195 0.45 1 0.31 1,236 0.48 2,760,450 0.87 Wisconsin 2,336 1.87 765 1.75 5 1.12 3,966 1.55 5,406,144 1.71 Wyoming 218 0.17 54 0.12 1 0.33 457 0.18 746,131 0.24 Total 124,606 100.00% 43,753 100.00% 405 100.00% 255,729 100.00% 315,648,206 100.00% Note: Figures may not add to totals due to rounding. 1 Lines for Alaska and Guam are estimated based on 2008 population. 3 Wireless subscribers for American Samoa, Guam, Northern Mariana Islands and Virgin Islands are estimated based on Form 502. 2 Payphone customers for the territories are estimated based on the 2008 population. The total includes estimates for the territories. O indicates the number of payphones is between 0 and 500. 1 - 42 Residential ILEC End-User Switched Access Lines: June 2008 Estimated ILEC Lifeline Subcribers Estimated Residential Lines Subject to a SLC Business ILEC End-User Switched Access Lines: June 2008 Residential SLC rate Multi-line Business Rate Estimated SLC Revenue Percent of Total Alabama 1,280,347 76,611 45,555 580,643 $6.50 $7.39 $147,794 1.71% Alaska 152,712 56,522 9,088 141,688 6.50 9.20 26,845 0.31 American Samoa 5,682 627 627 4,841 6.50 9.20 929 0.01 Arizona 1,191,843 77,274 17,302 750,770 6.32 6.59 148,454 1.71 Arkansas 706,594 29,719 29,719 362,512 5.71 6.63 75,253 0.87 California 10,043,231 2,310,438 2,292,231 7,105,898 4.86 5.17 893,200 10.32 Colorado 1,292,044 25,972 25,777 681,320 6.50 7.59 160,843 1.86 Connecticut 997,197 43,823 43,527 635,221 5.77 5.77 110,015 1.27 Delaware 243,135 1,984 1,984 153,265 6.45 6.45 30,528 0.35 Dist. of Columbia 175,152 7,237 7,237 612,385 3.86 3.86 36,143 0.42 Florida 5,088,386 281,423 254,744 2,843,865 6.49 7.38 628,240 7.26 Georgia 2,214,914 100,202 100,179 1,459,609 6.50 7.19 290,828 3.36 Guam 31,686 2,401 2,401 30,444 6.50 9.20 5,645 0.07 Hawaii 310,003 4,390 4,390 206,103 6.50 8.15 44,006 0.51 Idaho 399,341 28,283 26,785 209,197 6.43 7.33 47,132 0.54 Illinois 3,171,614 108,635 89,974 2,390,794 4.83 5.22 328,340 3.79 Indiana 1,730,675 55,307 55,276 934,621 5.92 7.01 197,506 2.28 Iowa 791,660 58,641 49,013 370,453 5.43 6.40 76,777 0.89 Kansas 586,085 26,761 21,922 391,283 5.56 6.12 66,351 0.77 Kentucky 1,002,369 64,913 52,523 539,961 6.38 7.57 121,838 1.41 Louisiana 1,069,156 39,051 35,272 640,407 6.50 7.04 134,774 1.56 Maine 431,895 64,534 59,488 146,772 6.30 6.82 40,168 0.46 Maryland 1,562,866 5,821 5,821 1,229,265 5.68 5.69 190,078 2.20 Massachusetts 1,545,480 91,466 91,466 1,063,947 6.42 6.42 194,033 2.24 Michigan 2,169,117 116,710 101,189 1,549,870 5.58 6.03 250,595 2.89 Minnesota 1,401,081 75,356 59,589 605,355 5.45 6.36 133,887 1.55 Mississippi 658,539 58,346 45,329 359,050 6.50 7.02 78,063 0.90 Missouri 1,702,956 70,983 63,212 865,016 5.63 6.15 174,593 2.02 Montana 267,320 17,261 10,131 139,130 6.50 9.20 35,421 0.41 Nebraska 352,058 20,534 16,706 254,046 5.21 6.07 39,461 0.46 Nevada 631,648 30,347 29,375 410,445 4.41 4.98 56,378 0.65 New Hampshire 360,707 5,439 5,387 146,706 6.27 6.52 38,218 0.44 New Jersey 2,294,745 108,648 108,648 1,641,721 6.25 6.35 289,169 3.34 New Mexico 534,480 76,610 38,056 248,781 6.50 9.20 66,186 0.76 New York 4,130,131 309,775 300,896 2,771,494 6.42 6.73 518,933 5.99 North Carolina 2,427,850 127,379 124,787 1,287,072 6.24 7.14 282,665 3.26 North Dakota 168,825 20,764 15,002 78,992 6.50 8.63 20,180 0.23 Northern Mariana Islands 8,593 1,277 1,258 9,309 6.50 9.20 1,600 0.02 Ohio 2,910,910 279,260 279,260 1,625,990 5.67 6.14 298,827 3.45 Oklahoma 811,239 186,539 47,275 455,444 5.56 6.12 84,435 0.98 Oregon 948,453 45,593 43,900 410,222 6.50 7.86 109,246 1.26 Pennsylvania 3,750,410 144,490 144,123 1,743,456 5.99 6.71 399,433 4.61 Puerto Rico 589,256 187,864 120,685 196,418 6.50 9.20 58,233 0.67 Rhode Island 191,386 30,748 25,348 110,842 6.42 6.42 21,331 0.25 South Carolina 1,159,689 46,813 45,194 567,919 6.46 7.58 138,059 1.59 South Dakota 165,606 19,820 9,156 95,060 6.49 7.86 21,144 0.24 Tennessee 1,639,851 98,696 85,649 795,704 6.40 7.13 187,350 2.16 Texas 5,560,638 909,252 844,565 3,459,627 5.59 6.21 574,079 6.63 Utah 531,194 29,982 28,362 279,943 6.39 6.68 61,026 0.70 Vermont 234,116 25,816 23,975 89,347 6.30 6.78 23,149 0.27 Virgin Islands 42,463 534 534 19,983 6.50 9.20 5,477 0.06 Virginia 1,959,546 43,242 37,990 1,462,033 6.15 6.72 259,628 3.00 Washington 1,684,294 108,255 68,705 824,589 6.09 7.03 187,704 2.17 West Virginia 579,230 6,012 5,580 173,059 6.50 8.49 62,370 0.72 Wisconsin 1,444,705 83,748 69,032 890,937 5.70 6.64 165,080 1.91 Wyoming 121,843 5,520 3,489 95,772 6.50 9.20 19,805 0.23 Total 77,456,946 6,853,648 6,124,689 47,148,596 $5.86 $6.39 $8,657,441 100.00% Note: Figures may not add to totals due to rounding. Table 1.18 Data Used to Allocate Interstate ILEC Revenue by State (Lines/Revenues Shown in Thousands) 1 - 43