Products and Services Revenues

12 Months Ended

Dec. 31, 2012

Products and Services Revenues

Products and Services Revenues

(10) Products and Services Revenues

        We are an integrated communications company engaged primarily in providing an array of communications services, including local and long-distance, network access, private line (including special access), broadband, Ethernet, data, managed hosting, wireless and video services. We strive to maintain our customer relationships by, among other things, bundling our service offerings to provide our customers with a complete offering of integrated communications services. We categorize our products and services into the following four categories:

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  Strategic services, which include primarily private line (including special access), broadband, Multi-Protocol Label Switching (which is a data networking technology that can deliver the quality of service required to support real-time voice and video), Ethernet, hosting, video (including resold satellite video services), voice over Internet Protocol and Verizon Wireless services;

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  Legacy services, which include primarily local, long-distance, Integrated services digital network (which uses regular telephone lines to support voice, video and data applications), switched access and traditional wide area network services (which allows a local communications network to link to networks in remote locations);

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  Data integration, which includes the sale of telecommunications equipment located on customers' premises and related professional services, such as network management, installation and maintenance of data equipment and building of proprietary fiber-optic broadband networks for our government and business customers; and

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  Affiliates and other services, which consist primarily of USF revenues and surcharges and services we provide to our non-consolidated affiliates. We provide to our affiliates telecommunications services that we also provide to external customers. In addition, we provide to our affiliates computer system development and support services and network support and technical services.

        During the first quarter of 2012, we reclassified certain prior period revenues between the aforementioned four categories to conform to the current period presentation.

        Since the April 1, 2011 closing of CenturyLink's acquisition of us, our operations have been integrated into and reported as part of the segments of CenturyLink. CenturyLink's chief operating decision maker ("CODM") has become our CODM, but reviews our financial information on an aggregate basis only in connection with our quarterly and annual reports that we file with the Securities and Exchange Commission. Consequently, we do not provide our discrete financial information to the CODM on a regular basis. As such, we believe we now have one reportable segment and have reclassified our prior period results to conform to our current view.

        Operating revenues for our products and services are summarized below:

	Successor				Predecessor
	Year Ended December 31, 2012		Nine Months Ended December 31, 2011		Three Months Ended March 31, 2011		Year Ended December 31, 2010
	(Dollars in millions)
Strategic services	$	4,978		3,615		1,200		4,637
Legacy services		4,848		3,901		1,400		5,974
Data integration		549		402		123		606
Affiliates and other services		981		409		123		513
Total operating revenues	$	11,356		8,327		2,846		11,730

        We do not have any single customer that provides more than 10% of our total revenue. Substantially all of our revenue comes from customers located in the United States.

        The table below presents the aggregate USF surcharges recognized on a gross basis:

	Successor				Predecessor
	Year Ended December 31, 2012		Nine Months Ended December 31, 2011		Three Months Ended March 31, 2011		Year Ended December 31, 2010
	(Dollars in millions)
Taxes and surcharges included in operating revenues and expenses	$	398		279		96		385