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Revenue Recognition
 12 Months Ended
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]  
Revenue Recognition Revenue Recognition
Product and Service Categories

Since the first quarter of 2021, we have categorized our products and services revenue among the following categories for the Business segment:

•Compute and Application Services, which include our Edge Cloud services, IT solutions, Unified Communications and Collaboration ("UC&C"), data center, content delivery network ("CDN") and Managed Security services;

•IP and Data Services, which include Ethernet, IP, and VPN data networks, including software-defined wide area networks ("SD WAN") based services, Dynamic Connections and Hyper WAN;

•Fiber Infrastructure Services, which include dark fiber, optical services and equipment; and

•Voice and Other, which include Time Division Multiplexing ("TDM") voice, private line and other legacy services.

Since the first quarter of 2021, we have categorized our products and services revenue among the following categories for the Mass Markets segment:

•Consumer Broadband, which includes high speed fiber-based and lower speed DSL-based broadband services to residential customers;

•Small Business Group ("SBG") Broadband, which includes high speed fiber-based and lower speed DSL-based broadband services to small businesses;

•Voice and Other, which include primarily local and long-distance services, professional services and other ancillary services; and

•Connect America Fund ("CAF") II, which consists of CAF Phase II payments through the end of 2021 to support voice and broadband in FCC-designated high-cost areas.

Reconciliation of Total Revenue to Revenue from Contracts with Customers

The following tables provide total revenue by segment, sales channel and product category. They also provide the amount of revenue that is not subject to ASC 606, "Revenue from Contracts with Customers" ("ASC 606"), but is instead governed by other accounting standards:
Year Ended December 31, 2021
Total Revenue
Adjustments for Non-ASC 606 Revenue (1)
Total Revenue from Contracts with Customers
 (Dollars in millions)
Business Segment by Sales Channel and Product Category
International and Global Accounts ("IGAM")
Compute and Application Services$715 (280)435 
IP and Data Services1,708 — 1,708 
Fiber Infrastructure886 (129)757 
Voice and Other744 — 744 
Total IGAM Revenue4,053 (409)3,644 
Large Enterprise
Compute and Application Services698 (63)635 
IP and Data Services1,554 — 1,554 
Fiber Infrastructure521 (50)471 
Voice and Other949 — 949 
Total Large Enterprise Revenue3,722 (113)3,609 
Mid-Market Enterprise
Compute and Application Services139 (31)108 
IP and Data Services1,754 (5)1,749 
Fiber Infrastructure218 (8)210 
Voice and Other618 — 618 
Total Mid-Market Enterprise Revenue2,729 (44)2,685 
Wholesale
Compute and Application Services189 (159)30 
IP and Data Services1,196 — 1,196 
Fiber Infrastructure623 (118)505 
Voice and Other1,607 (252)1,355 
Total Wholesale Revenue3,615 (529)3,086 
Business Segment by Product Category
Compute and Application Services1,741 (533)1,208 
IP and Data Services6,212 (5)6,207 
Fiber Infrastructure2,248 (305)1,943 
Voice and Other3,918 (252)3,666 
Total Business Segment Revenue14,119 (1,095)13,024 
Mass Markets Segment by Product Category
Consumer Broadband2,875 (211)2,664 
SBG Broadband156 (16)140 
Voice and Other2,047 (80)1,967 
CAF II490 (490)— 
Total Mass Markets Revenue5,568 (797)4,771 
Total Revenue$19,687 (1,892)17,795 
Timing of revenue
Goods and services transferred at a point in time$138 
Services performed over time17,657 
Total revenue from contracts with customers$17,795 
Year Ended December 31, 2020
Total Revenue
Adjustments for Non-ASC 606 Revenue (1)
Total Revenue from Contracts with Customers
 (Dollars in millions)
Business Segment by Sales Channel and Product Category
International and Global Accounts ("IGAM")
Compute and Application Services$772 (265)507 
IP and Data Services1,731 — 1,731 
Fiber Infrastructure822 (110)712 
Voice and Other793 — 793 
Total IGAM Revenue4,118 (375)3,743 
Large Enterprise
Compute and Application Services663 (82)581 
IP and Data Services1,588 (2)1,586 
Fiber Infrastructure590 (46)544 
Voice and Other1,074 (2)1,072 
Total Large Enterprise Revenue3,915 (132)3,783 
Mid-Market Enterprise
Compute and Application Services137 (16)121 
IP and Data Services1,845 (6)1,839 
Fiber Infrastructure218 (9)209 
Voice and Other769 — 769 
Total Mid-Market Enterprise Revenue2,969 (31)2,938 
Wholesale
Compute and Application Services183 (161)22 
IP and Data Services1,249 — 1,249 
Fiber Infrastructure618 (121)497 
Voice and Other1,765 (258)1,507 
Total Wholesale Revenue3,815 (540)3,275 
Business Segment by Product Category
Compute and Application Services1,755 (524)1,231 
IP and Data Services6,413 (8)6,405 
Fiber Infrastructure2,248 (286)1,962 
Voice and Other4,401 (260)4,141 
Total Business Segment Revenue14,817 (1,078)13,739 
Mass Markets Segment by Product Category
Consumer Broadband2,909 (221)2,688 
SBG Broadband153 (15)138 
Voice and Other2,341 (109)2,232 
CAF II492 (492)— 
Total Mass Markets Revenue5,895 (837)5,058 
Total Revenue$20,712 (1,915)18,797 
Timing of revenue
Goods and services transferred at a point in time$250 
Services performed over time18,547 
Total revenue from contracts with customers$18,797 
Year Ended December 31, 2019
Total Revenue
Adjustments for Non-ASC 606 Revenue (1)
Total Revenue from Contracts with Customers
 (Dollars in millions)
Business Segment by Sales Channel and Product Category
International and Global Accounts ("IGAM")
Compute and Application Services$790 (265)525 
IP and Data Services1,764 — 1,764 
Fiber Infrastructure785 (99)686 
Voice and Other833 — 833 
Total IGAM Revenue4,172 (364)3,808 
Large Enterprise
Compute and Application Services610 (89)521 
IP and Data Services1,589 — 1,589 
Fiber Infrastructure524 (44)480 
Voice and Other1,113 (1)1,112 
Total Large Enterprise Revenue3,836 (134)3,702 
Mid-Market Enterprise
Compute and Application Services147 (11)136 
IP and Data Services1,894 — 1,894 
Fiber Infrastructure219 (20)199 
Voice and Other892 (1)891 
Total Mid-Market Enterprise Revenue3,152 (32)3,120 
Wholesale
Compute and Application Services188 (168)20 
IP and Data Services1,319 — 1,319 
Fiber Infrastructure629 (122)507 
Voice and Other1,943 (279)1,664 
Total Wholesale Revenue4,079 (569)3,510 
Business Segment by Product Category
Compute and Application Services1,735 (533)1,202 
IP and Data Services6,566 — 6,566 
Fiber Infrastructure2,157 (285)1,872 
Voice and Other4,781 (281)4,500 
Total Business Segment Revenue15,239 (1,099)14,140 
Mass Markets Segment by Product Category
Consumer Broadband2,876 (215)2,661 
SBG Broadband163 (4)159 
Voice and Other2,688 (143)2,545 
CAF II492 (492)— 
Total Mass Markets Revenue6,219 (854)5,365 
Total Revenue$21,458 (1,953)19,505 
Timing of revenue
Goods and services transferred at a point in time$221 
Services performed over time19,284 
Total revenue from contracts with customers$19,505 
______________________________________________________________________
(1)Includes regulatory revenue and lease revenue not within the scope of ASC 606.

Customer Receivables and Contract Balances

The following table provides balances of customer receivables, contract assets and contract liabilities, net of amounts reclassified as held for sale, as of December 31, 2021 and December 31, 2020:
December 31, 2021December 31, 2020
 (Dollars in millions)
Customer receivables(1)(2)
$1,493 1,889 
Contract assets(3)
73 108 
Contract liabilities(4)
680 950 
______________________________________________________________________
(1)Reflects gross customer receivables of $1.6 billion and $2.1 billion, net of allowance for credit losses of $102 million and $174 million, at December 31, 2021 and December 31, 2020, respectively.
(2)As of December 31, 2021, amount excludes customer receivables, net reclassified as held for sale of $288 million.
(3)As of December 31, 2021, amount excludes contract assets reclassified as held for sale of $9 million.
(4)As of December 31, 2021, amount excludes contract liabilities reclassified as held for sale of $161 million.

Contract liabilities are consideration we have received from our customers or billed in advance of providing goods or services promised in the future. We defer recognizing this consideration as revenue until we have satisfied the related performance obligation to the customer. Contract liabilities include recurring services billed one month in advance and installation and maintenance charges that are deferred and recognized over the actual or expected contract term, which typically ranges from one to five years depending on the service. Contract liabilities are included within deferred revenue in our consolidated balance sheets. During the years ended December 31, 2021 and December 31, 2020, we recognized $605 million and $672 million, respectively, of revenue that was included in contract liabilities of $950 million and $1.0 billion as of January 1, 2021 and 2020, respectively.

Performance Obligations

As of December 31, 2021, our estimated revenue expected to be recognized in the future related to performance obligations associated with existing customer contracts that are partially or wholly unsatisfied is approximately $6.2 billion. We expect to recognize approximately 77% of this revenue through 2024, with the balance recognized thereafter.

These amounts exclude (i) the value of unsatisfied performance obligations for contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed (for example, uncommitted usage or non-recurring charges associated with professional or technical services to be completed), (ii) contracts that are classified as leasing arrangements that are not subject to ASC 606 and (iii) the value of unsatisfied performance obligations for contracts which relate to our planned divestiture.
Contract Costs

The following tables provide changes in our contract acquisition costs and fulfillment costs:
December 31, 2021
Acquisition CostsFulfillment Costs
 (Dollars in millions)
Beginning of period balance$289 216 
Costs incurred176 151 
Amortization(209)(149)
Reclassified as held for sale(1)
(34)(32)
End of period balance$222 186 

December 31, 2020
Acquisition CostsFulfillment Costs
 (Dollars in millions)
Beginning of period balance$326 221 
Costs incurred181 141 
Amortization(218)(146)
End of period balance$289 216 
______________________________________________________________________
(1)Represents the amounts reclassified as held for sale as of December 31, 2021 related to our planned divestitures. See Note 2—Planned Divestiture of the Latin American and ILEC Businesses.

Acquisition costs include commission fees paid to employees as a result of obtaining contracts. Fulfillment costs include third party and internal costs associated with the provision, installation and activation of telecommunications services to customers, including labor and materials consumed for these activities.

Deferred acquisition and fulfillment costs are amortized based on the transfer of services on a straight-line basis over the average contract life of approximately 30 months for mass markets customers and 29 months for business customers. Amortized fulfillment costs are included in cost of services and products and amortized acquisition costs are included in selling, general and administrative expenses in our consolidated statements of operations. The amount of these deferred costs that are anticipated to be amortized in the next 12 months are included in other current assets on our consolidated balance sheets. The amount of deferred costs expected to be amortized beyond the next twelve months is included in other non-current assets on our consolidated balance sheets. Deferred acquisition and fulfillment costs are assessed for impairment on an annual basis.