Verizon Wireless 2006 Annual Report Download - page 10

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888
Much฀of฀this฀growth฀comes฀from฀our฀leadership฀in฀wireless฀data,฀which฀in฀2006฀
accounted฀for฀$4.5฀billion฀in฀revenues.฀We฀ended฀the฀year฀with฀34.3฀million฀retail฀
data฀customers.฀With฀V฀CAST฀services฀and฀other฀high-speed฀applications,฀Verizon฀
Wireless฀is฀transforming฀the฀cell฀phone฀into฀a฀multimedia฀device฀capable฀of฀deliver-
ing฀music,฀Internet฀access,฀video฀and฀locator฀services.฀This฀gives฀us฀enormous฀room฀
for฀growth฀as฀we฀market฀these฀services฀to฀our฀loyal฀customer฀base.
We฀closed฀our฀merger฀with฀MCI฀in฀January฀2006฀to฀form฀Verizon฀Business.฀In฀
its฀rst฀year฀of฀operation,฀Verizon฀Business฀ staked฀out฀a฀strong฀competitive฀posi-
tion฀among฀multinational฀customers.฀The฀superior฀global฀IP฀capabilities฀that฀MCI฀
brought฀to฀the฀table฀give฀us฀a฀particularly฀strong฀position฀in฀the฀high-growth฀end฀
of฀the฀large-business฀market.฀
Verizon฀ Business฀ was฀ the฀ only฀ U.S.-based฀ large฀ business฀ carrier฀ to฀ show฀
quarter-over-quarter฀ revenue฀ growth,฀ fueled฀ by฀ 27.3฀ percent฀ growth฀ in฀ strate-
gic฀services฀such฀as฀advanced฀IP฀services,฀virtual฀private฀networks฀and฀managed฀
network฀services.฀Our฀industry-leading฀global฀network฀allows฀us฀to฀offer฀ultra-long-
haul,฀converged฀packet฀access฀and฀other฀advanced฀capabilities฀demanded฀by฀these฀
sophisticated฀customers.฀We฀also฀achieved฀$600฀million฀in฀merger฀synergies,฀which฀
exceeded฀our฀target,฀and฀raised฀our฀objective฀for฀2007฀to฀$900฀million.฀
Our฀principal฀goal฀ in฀ Verizon฀ Telecom฀ is฀ to฀ transform฀ our฀telecom฀franchise฀
into฀a฀broadband฀and฀entertainment฀business.฀To฀do฀ that,฀we฀are฀investing฀in฀a฀
ber฀network฀capable฀of฀delivering฀two-way,฀high-denition฀broadband฀and฀video฀
services฀at฀speeds฀currently฀up฀to฀50฀megabits฀per฀second,฀all฀the฀way฀to฀homes฀and฀
businesses฀–฀the฀fastest฀broadband฀service฀available฀in฀the฀market฀today.฀
This฀historic฀project฀–฀launched฀in฀July฀2004฀–฀began฀to฀bear฀fruit฀in฀2006.฀Our฀
advanced฀ber-optic฀network฀passed฀a฀total฀of฀6.2฀million฀homes฀and฀businesses฀
by฀the฀end฀of฀the฀year.฀We฀expanded฀our฀FiOS฀brand฀of฀high-speed฀data฀services,฀
which฀when฀combined฀with฀DSL฀gave฀us฀ 7฀million฀broadband฀customers฀for฀the฀
year,฀up฀35.7฀percent.฀We฀also฀introduced฀FiOS฀TV฀in฀September฀2005฀and฀now฀offer฀
video฀to฀customers฀in฀hundreds฀of฀communities฀across฀the฀country฀in฀competition฀
with฀cable฀providers.฀Essentially,฀we฀created฀a฀complex฀new฀business฀from฀scratch฀
in฀less฀than฀two฀years฀and฀ended฀2006฀with฀207,000฀video฀customers.฀We฀expect฀
video฀to฀gain฀even฀more฀momentum฀in฀2007.
So฀2006฀was฀another฀year฀of฀solid฀operating฀performance฀and฀steady฀progress฀
in฀transforming฀our฀company.฀We฀completed฀a฀major฀merger,฀streamlined฀our฀struc-
ture,฀took฀market฀share,฀and฀put฀telecom฀and฀global฀business฀on฀a฀path฀to฀growth.฀
0
Actual Forecast
U.S. HDTV Households
(millions)
00 01 02 03 04 05 06 07 08 09 10 11
Y E A R
Source: Forrester Research, Inc., June, 2006
10
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70 64.0