AT&T Wireless 2011 Annual Report Download - page 68

Notes to Consolidated Financial Statements (continued)
Dollars in millions except per share amounts
66 AT&T Inc.
The Wireline segment uses our regional, national and global
network to provide consumer and business customers with
landline voice and data communications services, AT&T
U-verse® TV, high-speed broadband and voice services and
managed networking to business customers. Additionally, we
receive commissions on sales of satellite television services
offered through our agency arrangements.
The Advertising Solutions segment includes our directory
operations, which publish Yellow and White Pages directories
and sell directory advertising and Internet-based advertising
and local search. In 2011, we moved $1,927 of goodwill from
the Advertising Solutions segment to the Wireline segment
based on a change in how we managed the U-verse related
advertising business (see Note 6).
The Other segment includes results from customer information
services, our portion of the results from our international
equity investments and all corporate and other operations.
Also included in the Other segment are impacts of corporate-
wide decisions for which the individual operating segments
are not being evaluated, including interest cost and expected
return on plan assets for our pension and postretirement
benefit plans.
In the following tables, we show how our segment results are
reconciled to our consolidated results reported. The Wireless,
Wireline, Advertising Solutions and Other columns represent
the segment results of each such operating segment.
The Consolidations column adds in those line items that
we manage on a consolidated basis only: actuarial gains
and losses from pension and other postretirement benefits,
interest expense and other income (expense) – net.
At December 31, 2011, 2010 and 2009, we had issued and
outstanding options to purchase approximately 66 million,
130 million, and 178 million shares of AT&T common stock.
The exercise prices of 40 million, 100 million, and 163 million
shares in 2011, 2010, and 2009 were above the average
market price of AT&T stock for the respective periods.
Accordingly, we did not include these amounts in determining
the dilutive potential common shares. At December 31, 2011,
the exercise prices of 24 million vested stock options were
below market price.
NOTE 4. SEGMENT INFORMATION
Our segments are strategic business units that offer different
products and services over various technology platforms
and are managed accordingly. We analyze our various
operating segments based on segment income before
income taxes. We make our capital allocations decisions
based on our strategic direction of the business, needs of
the network (wireless or wireline) providing services and
other assets needed to provide emerging services to our
customers. Actuarial gains and losses from pension and
other postretirement benefits, interest expense and other
income (expense) – net, are managed only on a total
company basis and are, accordingly, reflected only in
consolidated results. Therefore, these items are not included
in the calculation of each segment’s percentage of our
total segment income. The customers and long-lived assets
of our reportable segments are predominantly in the
United States. We have four reportable segments:
(1) Wireless, (2) Wireline, (3) Advertising Solutions
and (4) Other.
The Wireless segment uses our nationwide network to provide
consumer and business customers with wireless voice and
advanced data communications services.