Cincinnati Bell 2013 Annual Report Download - page 88

Professional Services include staff augmentation and professional IT consulting by highly technical, certified
employees. These engagements can be short-term IT implementation and project-based work as well as longer term
staffing and permanent placement assignments. The Company utilizes a team of experienced recruiting and hiring
personnel to provide its customers a wide range of skilled IT professionals at competitive hourly rates.
Telecom and IT equipment
The Company maintains premium resale relationships and certifications with a variety of branded
technology vendors which allow it to competitively sell and install a wide array of telecommunications and
computer equipment to meet the needs of its customers. This unit also manages the maintenance of a large base
of local customers with traditional voice systems as well as converged VoIP systems.
Wireless
Cincinnati Bell Wireless LLC (“CBW”) provides digital wireless voice and data communications services
through the operation of a Global System for Mobile Communications/General Packet Radio Service (“GSM”)
network with a 3G Universal Mobile Telecommunications System (“UMTS”) and 4G High Speed Packet
Access+ (“HSPA+”) network overlay, which is able to provide high-speed data services such as streaming video.
Wireless services are provided to customers in the Company’s licensed service territory, which includes Greater
Cincinnati and Dayton, Ohio, and areas of northern Kentucky and southeastern Indiana. The Company’s
customers are also able to place and receive wireless calls nationally and internationally due to roaming
agreements the Company has with other carriers.
The Company’s digital wireless network utilizes approximately 460 cell sites in its operating territory. The
Company’s digital wireless network utilizes 50 MHz of licensed wireless spectrum in the Cincinnati area and 40
MHz of licensed spectrum in the Dayton area. The Company owns the licenses for the spectrum that it uses in its
network operations.
Service revenue
A variety of monthly rate plans are available to postpaid subscribers. These plans can include a fixed or
unlimited number of national or local minutes for a flat monthly rate. For plans with a fixed number of minutes,
postpaid subscribers can purchase additional minutes at a per-minute-of-use rate. Postpaid subscribers are billed
monthly in arrears.
Prepaid i-wirelessSM subscribers pay in advance for use with pay per minute, pay by day, pay by week, or
pay by month rate plans. Weekly and monthly smartphone plans are also available for prepaid i-wirelessSM
subscribers. In 2011, CBW began offering prepaid service plans utilizing lifeline subsidies from Ohio and
Kentucky, which are discounted versions of our standard prepaid service plans to certain customers who receive
government assistance.
Equipment revenue
As is typical in the wireless communications industry, CBW sells wireless handset devices at or below cost
to entice customers to use its wireless services, for which a recurring monthly fee is charged. The Company has
approximately 59% of its postpaid subscribers under equipment contracts. These contracts require the customer
to use the CBW monthly service for a minimum period of two years in exchange for a deeply discounted wireless
handset.
Equity Method Investment in CyrusOne
At December 31, 2013, we owned approximately 1.9 million shares of CyrusOne’s common stock and are a
limited partner in CyrusOne LP, owning approximately 42.6 million partnership units. Although we effectively
own approximately 69% of CyrusOne through our ownership of its common stock and partnership units of
CyrusOne LP, we no longer control its operations. As such, effective January 24, 2013, we no longer consolidate
CyrusOne in our consolidated financial statements and now account for our ownership in CyrusOne as an equity
method investment. At December 31, 2013, the fair value of this investment was $993.2 million based on the
quoted market price of CyrusOne’s common stock.
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Form 10-K Part I Cincinnati Bell Inc.