CenturyLink 2011 Annual Report Download - page 8

In total, our 2011 efforts resulted in a six percent increase in strategic revenues on a pro forma
basis. Strategic revenues now account for nearly 43 percent of our total revenues, up from
39 percent from pro forma 2010. With continued emphasis on managing costs and achieving
targeted synergies, we generated solid free cash flow in 2011 and returned $1.556 billion to our
stockholders through dividend payments.
Investing for growth
With the people, products and capabilities we’ve added through our three recent major
acquisitions, we have the right strategies and assets in place to continue transforming our
company. Our focus is on four key growth drivers that we believe offer the most attractive
strategic revenue opportunities and long-term advantage for CenturyLink.
•฀ Broadband฀expansion฀and฀enhancements
We continue to invest in our broadband network – extending our footprint, enhancing speeds
and adding advanced features and functionality. More than 90 percent of our access lines are
broadband-enabled – 50 percent of which are capable of speeds of 10 Mbps or higher and
20 percent are capable of 20 Mbps or higher. We continue to build fiber deeper into our
network. In particular, we expect to enable approximately one million additional living units
in 2012 through our FTTN expansion initiative. Our product offerings include high-demand,
next-generation IP services such as high-speed Internet, Ethernet, CenturyLink Prism™ TV,
MPLS and VoIP.
•฀ CenturyLink฀Prism™฀TV฀expansion
We are focused on growing our CenturyLink Prism™ TV subscriber base and pursuing a
capital-efficient approach to market expansions. Our Prism™ TV subscriber base grew by
approximately 35 percent in fourth quarter 2011, reaching nearly 70,000 subscribers at
year-end. Approximately 50 percent of these Prism™ TV customers are new CenturyLink
customers, and more than 90 percent of these customers also subscribe to our high-speed
Internet service. We expect to launch Prism™ TV in our first legacy Qwest market in 2012.
•฀ Fiber-to-the-tower฀initiative
Our fiber-to-the-tower (FTTT) investments strengthen our data transport capabilities and
enhance our local fiber networks. In addition to providing an avenue to participate in the
fast-growing wireless data market, our FTTT initiative opens new broadband opportunities
in our markets. We expect to build fiber to another 4,000 to 5,000 tower sites in 2012.
•฀ Managed฀hosting฀and฀cloud฀services
We believe managed hosting and cloud services offer significant growth potential in 2012
and beyond, and we are committed to investing in this business. We anticipate adding another
100,000 square feet of sellable data center space in 2012. We also are focused on achieving
efficiencies across our data center and network infrastructure by rationalizing the combined
legacy Qwest and legacy Savvis data center footprints and connecting all centers to our
network. We will continue to pursue cross-selling opportunities into our combined enterprise
customer base and expect to launch newly developed cloud services for small-to-medium-size
businesses this year. We also will evaluate growth opportunities outside the U.S., particularly
in the high-growth Asia-Pacific region.
To Our Stockholders continued ...
Opportunity Multiplied
6
BUILDING
•฀ We฀completed฀ber฀builds฀to฀about฀
5,800 cell sites, bringing our year-end
total to approximately 10,200 sites.
•฀ Fiber฀builds฀lead฀to฀long-term฀contracts฀
for wireless data transport that will support
future revenue growth opportunities.