Earthlink 2009 Annual Report Download - page 42

Table of Contents
Revenues
The following table presents revenues by groups of similar services and by segment for the years ended December 31, 2007, 2008 and
2009:
Consolidated revenues
The primary component of our revenues is access and service revenues, which consist of narrowband access services (including traditional,
fully-featured narrowband access and value-priced narrowband access); broadband access services (including high-
speed access via DSL and
cable; VoIP; and managed IP-based wide area networks); and web hosting services. We also earn revenues from value-
added services, which
include revenues from ancillary services sold as add-
on features to our Internet access services, search and advertising. Total revenues were
$1.2 billion, $1.0 billion and $0.7 billion during the years ended December 31, 2007, 2008 and 2009, respectively. The decreases over the past
three years were primarily due to decreases in our Consumer Services segment, resulting from decreases in average consumer subscribers, which
were approximately 4.3 million, 3.1 million and 2.3 million during the years ended December 31, 2007, 2008 and 2009, respectively. These
decreases were driven by narrowband and broadband subscribers, as we reduced our sales and marketing efforts in connection with our
refocused strategy and as the market for Internet access continued to mature. Also contributing to the decrease in total revenues were decreases
in our Business Services segment. The decreases in business services revenue were primarily due to decreases in average business subscribers,
which were approximately 207,000, 179,000 and 149,000 during the years ended December 31, 2007, 2008 and 2009, respectively. Slightly
offsetting the decreases in our average business subscribers were increases in business services ARPU, which increased due to the shift in mix of
our business access subscriber base from business dial-up and high-speed services to IP-based network services.
Consumer services revenues
Access and service. Consumer access and service revenues consist of narrowband access (including traditional, fully-
featured
narrowband access and value-priced narrowband access) and broadband access services (including high-
speed access via DSL and cable and
VoIP services). These revenues are derived from fees charged to customers for dial-up Internet access; fees charged for high-
speed access
services; fees charged for VoIP services; usage fees; shipping and handling fees; and termination fees.
Consumer access and service revenues decreased $215.3 million, or 24%, from the year ended December 31, 2007 to the year ended
December 31, 2008 and decreased $178.4 million, or 26%, from the
38
Year Ended December 31,
2008 vs. 2007
2009 vs. 2008
2007
2008
2009
$ Change
% Change
$ Change
% Change
(dollars in thousands)
Consumer
Services
Access and
service
$
897,423
$
682,135
$
503,769
$
(215,288
)
-
24%
$
(178,366
)
-
26%
Value-
added
services
127,985
97,741
71,643
(30,244
)
-
24%
(26,098
)
-
27%
Total
revenues
$
1,025,408
$
779,876
$
575,412
$
(245,532
)
-
24%
$
(204,464
)
-
26%
Business
Services
Access and
service
$
187,709
$
172,944
$
146,087
$
(14,765
)
-
8%
$
(26,857
)
-
16%
Value-
added
services
2,877
2,757
2,230
(120
)
-
4%
(527
)
-
19%
Total
revenues
$
190,586
$
175,701
$
148,317
$
(14,885
)
-
8%
$
(27,384
)
-
16%
Consolidated
Access and
service
$
1,085,132
$
855,079
$
649,856
$
(230,053
)
-
21%
$
(205,223
)
-
24%
Value
-
added
services
130,862
100,498
73,873
(30,364
)
-
23%
(26,625
)
-
26%
Total
revenues
$
1,215,994
$
955,577
$
723,729
$
(260,417
)
-
21%
$
(231,848
)
-
24%