Verizon NEVO Program Tom Maguire Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. What is Verizon’s Network Evolution program? Verizon NEVO Is • A way to leverage the latest Verizon technology to serve our existing and future customers – Deliver current services with better reliability – Maintain or reduce the cost to the customer – Position the network for future demands Verizon NEVO Is Not • IP transition – VoIP, and POTS, can travel over many technologies • A way to charge customers more money • Anti-competitive • The end of copper Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 2 Typical Verizon Neighborhood Central Office Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 3 Issue #1 Typical Verizon Neighborhood • >30% already cut the cord • 60% bundle Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 4 Customers Are Fleeing Copper 53M 17.4M 35.6M copper lines lost in 12 years Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 5 Issue #1 Customers Alternatives Growing Customers have more options than ever Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 6 Jun-12 Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. Sep-13 Jun-13 Mar-13 Dec-12 Sep-12 IPad Air series launch 11/13 500M FiOS launch 7/13 Google PPP Increase 8/13 Netflix Super HD 9//13 5 million FiOS subscribers 3/12 300M FiOS launch 6/12 IPhone 5 S launch 9/21 IPad Mini launch 11/12 Google+ launch 6/11 15M HSI launch 8/10 150M FiOS launch 11/10 IPad launch 4/10 15M, 25M, 35M FiOS launch 6/09 5M HSI Offering 9/08 First Android smartphone (HTC Dream) 10/08 7M HSI Offering 12/07 Netflix unlimited video streaming 1/08 Hulu launches in US 3/08 IPhone launch 6/07 Amazon Video Service launch 9/06 Facebook opens to public 9/06 Xbox 360 Launch 11/05 5M HSI Subscribers 1/06 You Tube launch 2/05 3M HSI Offering 9/04 Initial Facebook launch 2/04 Skype launch 8/03 Fiber Mar-12 Dec-11 Sep-11 Jun-11 Mar-11 Dec-10 Sep-10 Jun-10 Mar-10 Dec-09 Sep-09 Jun-09 Mar-09 Dec-08 Sep-08 Jun-08 Mar-08 Dec-07 Sep-07 Jun-07 Mar-07 Dec-06 Sep-06 Jun-06 Mar-06 Dec-05 Sep-05 Jun-05 Mar-05 Dec-04 Sep-04 Jun-04 Mar-04 Dec-03 Xbox Live launch 11/02 Copper Sep-03 Jun-03 Mar-03 Dec-02 Sep-02 Bandwidth Utilization Continues to Grow 7 Fiber Migration Process Copper-Fed Home Configuration The copper network currently runs from the CO to the customer location carrying traditional telephone signals. Fiber-Fed Home Configuration 1.Signals are converted to light in the CO. The light is delivered over the fiber optic cable. H t t O N T X X VZ Central Office 2.The light is converted back to a traditional signal at the customer’s location by an ONT. VZ Central Office 3.The ONT is inside or outside the home and plugs into an electrical outlet. A back-up battery is provided in the event of a power outage. 4.The customer’s IW is connected to the ONT. 500K customers now better served Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 8 Adapting Technology What Happens in Copper-Only Areas? • If copper is working well, nothing changes • If copper is not working well, utilize a new wireless device to serve voice-only customers – Match existing critical features, including E911 – Monthly rate must be equal to or less than existing – Company owned and serviced device – Ability to backlight the existing in-home network – Extended battery back-up capabilities Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 9 What is Verizon Voice Link? VVL Is VVL Is Not • Currently designed for a specific, voice-only customer base – Chronic customers only • Designed to replace all copper • More expensive • Something developed in a vacuum there was extensive stakeholdering – Data customers or customers with monitoring devices are out of scope • Customers – Customers with immediate needs • Employees • Advocacy groups • A proven, reliable technology • Regulators, including NARUC, – Uses VzW network MACRUC, UNM, FCC IP – No wires to break Transition Panel – Customer-managed battery back-up • Media Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 10 What is Verizon Voice Link? Service Lights Antenna Voice Mail Battery Indicator Signal Strength Line Ports Power Button Power Port Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 11 Verizon Voice Link Migration Process Copper-Fed Home Configuration The copper network currently runs from the CO to the customer location carrying traditional telephone signals. Wireless-Fed Home Configuration 1.The new device is installed in the customers home in a spot with the best wireless signal. 2.The inside wire is isolated from the OSP at the NID Wireless Device t t X X VZ Central Office VZ Central Office 3.The device is plugged into a jack connected to the rest of the in-home network, thus “backlighting” the entire house. 4.The customer’s number is ported to the new device. Nearly 4K customers moved to date Confidential and proprietary materials for authorized Verizon personnel and outside agencies only. Use, disclosure or distribution of this material is not permitted to any unauthorized persons or third parties except by written agreement. 12