CenturyLink 2015 Annual Report Download - page 3

This is a time of significant challenge but great
opportunity for our company. We enter 2016 with
a renewed and energetic focus on our fundamental
mission: to improve our customers’ lives by connecting
them to the power of the digital world.
CenturyLink is well-positioned to take advantage of
the outstanding opportunities the digital revolution is
creating around the world. We have the assets and the
people necessary to deliver critical broadband capacity
and related services to meet the increasing demand
for speed and new applications. We also have the
financial strength to continue to invest in our business
while returning cash to shareholders at attractive and
sustainable levels.
Making the proper long-term decisions in this
rapidly changing environment is crucial. Customer
expectations are growing; technology is rapidly
advancing; and we face strong competition on
multiple fronts. Long-term success in this
environment of change will require continued
improvements to our team, network, systems and
service delivery capabilities.
We are actively making the changes necessary to
enable us to fulfill our commitments to our customers,
our shareholders and our employees. While the pace
of this change can be trying, we believe there is good
reason for optimism in our pathway to growth and in
the future for our company.
2015 SUMMARY ANNUAL REPORT AND 2016 ANNUAL MEETING DOCUMENTS 1
PATHWAY TO GROWTH
During 2015, we grew revenues from business
high-bandwidth data services, consumer high-
speed Internet services and other strategic services
by over $500 million, a 9.2 percent growth rate.
Demand for these services is expected to continue to
increase in the coming years. For example, industry
analysts project that Ethernet demand will grow at
an annual compounded rate of eight percent through
2020. Likewise, demand for managed security and
managed network services is expected to grow at
an annual compounded rate of 10 percent during
that same period. Finally, demand in consumer and
business broadband is strong and expected to continue
its growth through 2020.
These are all services we are provisioning today and,
in many cases, we are under-penetrated relative to the
market. We believe we have good opportunity to grow
our broadband access revenues, and we expect to
continue to expand both the reach and capacity of our
network while improving the scale and efficiency of our
direct and indirect business sales channels.
Broadband access represents the core of our
value proposition, but our business customers
are also frequently interested in a broader suite
of managed, IT and data analytics services.
CenturyLink is well-positioned to deliver this range
of access, managed and IT services our business
customers demand. While these new service offerings
do not generate the same margins as our network
business, their high growth rates and lower capital
requirements give us a good opportunity to grow
revenue and improve our overall return on
invested capital.
To Our Shareholders