FairPoint Communications 2007 Annual Report Download - page 10

Table of Contents
from the Universal Service Fund would decline. Conversely, if the national average cost per loop decreases and our operating costs (and
average cost per loop) remain constant or increase, the payments we receive from the Universal Service Fund would increase.
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We offer switched and dedicated long distance services throughout our service areas through resale agreements with national
interexchange carriers. In addition, through our wholly-owned subsidiary FairPoint Carrier Services, Inc., or Carrier Services, we offer
wholesale long distance services to communications providers that are not affiliated with us.
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We offer Internet access via DSL technology, dedicated T-1 connections, Internet dial-up, high speed cable modem and wireless
broadband. Customers can utilize this access in combination with customer owned equipment and software to establish a presence on the
web. In addition, we offer enhanced Internet services, which include obtaining Internet protocol addresses, basic web site design and
hosting, domain name services, content feeds and web-based e-mail services. Our services include access to 24-hour, 7-day a week
customer support.
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We seek to capitalize on our local exchange carriers’ local presence and network infrastructure by offering enhanced services to
customers, as well as billing and collection services for interexchange carriers.
 In certain of our markets we offer video services to our customers through cable television and video-over-
DSL.
 Our advanced digital switch and voicemail platforms allow us to offer enhanced services such as call waiting,
call forwarding and transferring, three-way calling, automatic callback, call hold, caller name and number identification, voice mail,
teleconferencing, video conferencing, store-and-forward fax, follow-me numbers, Centrex services and direct inward dial.
 Many interexchange carriers provide long distance services to our local exchange carrier customers and may
elect to use our billing and collection services. Our local exchange carriers charge interexchange carriers a billing and collection fee for each
call record generated by the interexchange carrier’s customer.
 Through our local telephone companies, we publish telephone directories in the majority of our locations. These
directories provide white page listings, yellow page listings and community information listings. We contract with leading industry
providers to assist in the sale of advertising and the compilation of information, as well as the production, publication and distribution of
these directories.
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Most of our 30 local exchange companies operate as the incumbent local exchange carrier in each of their respective markets. Our
local exchange companies served an average of approximately 13 access lines per square mile versus the non-rural carrier average of
approximately 128 access lines per square mile. Approximately 77% of our access lines served residential customers as of December 31,
2007. Our business customers accounted for approximately 23% of our access lines as of December 31, 2007. Our business customers
are predominantly in the agriculture, light manufacturing and service industries.
Following the merger, our operations will be more focused on small urban markets and will be geographically concentrated in the
northeastern United States.
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