Frontier Communications 2008 Annual Report Download - page 23

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Forward-Looking Statements
This annual report on Form 10-K contains forward-looking statements that are subject to risks and
uncertainties that could cause actual results to differ materially from those expressed or implied in the
statements. Statements that are not historical facts are forward-looking statements made pursuant to the safe
harbor provisions of The Private Securities Litigation Reform Act of 1995. Words such as “believe,”
“anticipate,” “expect” and similar expressions are intended to identify forward-looking statements. Forward-
looking statements (including oral representations) are only predictions or statements of current plans, which
we review continuously. Forward-looking statements may differ from actual future results due to, but not
limited to, and our future results may be materially affected by, any of the following possibilities:
•Reductions in the number of our access lines and High-Speed Internet subscribers;
•The effects of competition from cable, wireless and other wireline carriers (through voice over internet
protocol (VOIP) or otherwise);
•Reductions in switched access revenues as a result of regulation, competition and/or technology
substitutions;
•The effects of greater than anticipated competition requiring new pricing, marketing strategies or new
product offerings and the risk that we will not respond on a timely or profitable basis;
•The effects of changes in both general and local economic conditions on the markets we serve, which
can impact demand for our products and services, customer purchasing decisions, collectability of
revenue and required levels of capital expenditures related to new construction of residences and
businesses;
•Our ability to effectively manage service quality;
•Our ability to successfully introduce new product offerings, including our ability to offer bundled
service packages on terms that are both profitable to us and attractive to our customers;
•Our ability to sell enhanced and data services in order to offset ongoing declines in revenue from local
services, switched access services and subsidies;
•Changes in accounting policies or practices adopted voluntarily or as required by generally accepted
accounting principles or regulators;
•The effects of ongoing changes in the regulation of the communications industry as a result of federal
and state legislation and regulation, including potential changes in state rate of return limitations on our
earnings, access charges and subsidy payments, and regulatory network upgrade and reliability
requirements;
•Our ability to effectively manage our operations, operating expenses and capital expenditures, to pay
dividends and to reduce or refinance our debt;
•Adverse changes in the credit markets and/or in the ratings given to our debt securities by nationally
accredited ratings organizations, which could limit or restrict the availability of, and/or increase the cost
of financing;
•The effects of bankruptcies and home foreclosures, which could result in increased bad debts;
•The effects of technological changes and competition on our capital expenditures and product and
service offerings, including the lack of assurance that our ongoing network improvements will be
sufficient to meet or exceed the capabilities and quality of competing networks;
•The effects of increased medical, retiree and pension expenses and related funding requirements;
•Changes in income tax rates, tax laws, regulations or rulings, and/or federal or state tax assessments;
•Further declines in the value of our pension plan assets, which could require us to make contributions to
the pension plan beginning in 2010;
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FRONTIER COMMUNICATIONS CORPORATION AND SUBSIDIARIES