Revenue Recognition

6 Months Ended

Jun. 30, 2023

Revenue Recognition [Abstract]

Revenue Recognition

(3) Revenue Recognition:

We categorize our products, services and other revenues into the following categories:

Data and Internet services include broadband services for consumer and business customers. We provide data transmission services to high volume business customers and other carriers with dedicated high capacity circuits (“non-switched access”) including services to wireless providers (wireless backhaul);

Voice services include traditional local and long-distance wireline services, Voice over Internet Protocol (VoIP) services, as well as a number of unified messaging services offered to our consumer and business customers. Voice services also include the long-distance voice origination and termination services that we provide to our business customers and other carriers;

Video services include revenues generated from services provided directly to consumer customers as linear terrestrial television services, through various satellite providers, and through partnerships with over-the-top (OTT) video providers. Video services also includes pay-per-view revenues, video on demand, equipment rentals, and video advertising. We have made the strategic decision to limit sales of new traditional TV services, focusing on our broadband products and OTT video options;

Other customer revenue includes switched access revenue, rents collected for colocation services, and revenue from other services and fees. Switched access revenue includes revenues derived from allowing other carriers to use our network to originate and/or terminate their local and long-distance voice traffic (switched access). These services are primarily billed on a minutes-of-use basis applying tariffed rates filed with the FCC or state agencies; and

Subsidy and other regulatory revenue includes revenues generated from cost subsidies from state and federal authorities, including the CAF II and RDOF.

The following tables provide a summary of revenues, by category:

	For the three months ended ‎June 30,				For the six months ended ‎June 30,
($ in millions)	2023		2022		2023		2022
Data and Internet services	$	880	$	847	$	1,742	$	1,683
Voice services		347		381		703		767
Video services		112		134		229		271
Other		89		80		172		163
Revenue from contracts with customers (1)		1,428		1,442		2,846		2,884
Subsidy and other revenue		21		17		43		22
Total revenue	$	1,449	$	1,459	$	2,889	$	2,906
	For the three months ended ‎June 30,				For the six months ended ‎June 30,
($ in millions)	2023		2022		2023		2022
Consumer	$	775	$	791	$	1,536	$	1,567
Business and wholesale		653		651		1,310		1,317
Revenue from contracts with customers (1)		1,428		1,442		2,846		2,884
Subsidy and other revenue		21		17		43		22
Total revenue	$	1,449	$	1,459	$	2,889	$	2,906

⁽¹⁾Includes lease revenue of $15 million and $30 million for the three and six months ended June 30, 2023, and $16 million and $32 million for the three and six months ended June 30, 2022, respectively.

The following is a summary of the changes in the contract liabilities:

	Contract Liabilities
($ in millions)	Current		Noncurrent
Balance at December 31, 2022	$	27	$	17
Revenue recognized included in opening contract balance		(23)		(6)
Credits granted, excluding amounts recognized as revenue		23		11
Reclassified between current and noncurrent		4		(4)
Balance at June 30, 2023	$	31	$	18
	Contract Liabilities
($ in millions)	Current		Noncurrent
Balance at December 31, 2021	$	27	$	11
Revenue recognized included in opening contract balance		(20)		(5)
Credits granted, excluding amounts recognized as revenue		18		11
Reclassified between current and concurrent		2		(2)
Balance at June 30, 2022	$	27	$	15

The unsatisfied obligations for retail customers consist of amounts in advance billings, which are expected to be earned within the following monthly billing cycle. Unsatisfied obligations for wholesale customers are based on a point-in-time calculation and determined by the number of circuits provided and the contractual price. These wholesale customer obligations change from period to period based on new circuits added as well as circuits that are terminated.

The following table includes estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period:

($ in millions)	Revenue from contracts with customers
2023 (remaining six months)	$	394
2024		285
2025		156
2026		60
2027		11
Thereafter		6
Total	$	912