MB DOCKET NO. 14-57 · The subscriber counts do not include Bulk Multi-Dwelling Unit (MDU)...

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REDACTED - FOR PUBLIC INSPECTION (filed November 5, 2014) C£NTURYLINK'S OCTOBER 31, 2014 R ESPON SE TO INFORMATION, DAT A AND DOCUMENT REQUEST MB DOCKET NO. 14-57 1. For the period beginning January 1, 2013 through June 30, 2014, provide: a. plan level subscri ber data by zip code for the period beginning June 1, 2013 through June 30, 2014, as requested in the Billing Plan Data Table (attached); Response: Century Link offers separate telephony, internet access, and video services that may be bundled together. The accompanying Billing Plan Data Table 1 has been completed with infonnation specific to the video services CenturyLink offers. The subscriber counts for each video package offered are provided by market as we do not track subscriber counts at the zip code level. Attaclunent l .a(B) is a list of zip codes in which Centu1yLink offers Prism video service by market. The subscriber counts do not include Bulk Multi-Dwelling Unit (MDU) subscribers. Additionally on the Billing Table, Prism channel counts by package include HD channels counted separately from SD channels. Chrumel counts by month are not tracked for our WI and JA cable systems packages. Our cable system packages in WI and IA offer up to 95 channels, depending upon t he market. The cunent cha1mel-line up for Prism service in each market can be found online at: http://www.centurylink.com/prismtv/#prism-tv-channel-lineup.html. We are also unable to provide subscriber counts by length of subscription, subscriber disconnect data, ETF data, APSPR data and acquisition cost data as we do not track the requested data in this manner. While our video service offerings do not include lnteme t Access Service, subscribers of our P1ism IPTV service must be able to receive a minimum bandwidth of 25 Mbps in order to receive Prism. Internet service ranging from 1.5 Mbps to 1 Gbps is available to bundle with Prism service, with the maximum speed available dependent upon the network capability and the number of HD streams the customer elects with their video subscription. Approximately 90% of Prism subscribers also subscribe to our internet 1 See Attachment l .a(A)

Transcript of MB DOCKET NO. 14-57 · The subscriber counts do not include Bulk Multi-Dwelling Unit (MDU)...

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REDACTED - FOR PUBLIC INSPECTION (filed November 5, 2014)

C£NTURYLINK'S OCTOBER 31, 2014 R ESPONSE

TO INFORMATION, DAT A AND DOCUMENT REQUEST

MB DOCKET NO. 14-57

1. For the period beginning January 1, 2013 through June 30, 2014, provide:

a. plan level subscriber data by zip code for the period beginning June 1, 2013 through June 30, 2014, as requested in the Billing Plan Data Table (attached);

Response:

Century Link offers separate telephony, internet access, and video services that may be bundled together.

The accompanying Billing Plan Data Table1 has been completed with infonnation specific to the video services CenturyLink offers. The subscriber counts for each video package offered are provided by market as we do not track subscriber counts at the zip code level. Attaclunent l .a(B) is a list of zip codes in which Centu1yLink offers Prism video service by market. The subscriber counts do not include Bulk Multi-Dwelling Unit (MDU) subscribers.

Additionally on the Billing Table, Prism channel counts by package include HD channels counted separately from SD channels. Chrumel counts by month are not tracked for our WI and JA cable systems packages. Our cable system packages in WI and IA offer up to 95 channels, depending upon the market. The cunent cha1mel-line up for Prism service in each market can be found online at: http://www.centurylink.com/prismtv/#prism-tv-channel-lineup.html.

We are also unable to provide subscriber counts by length of subscription, subscriber disconnect data, ETF data, APSPR data and acquisition cost data as we do not track the requested data in this manner.

While our video service offerings do not include lntemet Access Service, subscribers of our P1ism IPTV service must be able to receive a minimum bandwidth of 25 Mbps in order to receive Prism. Internet service ranging from 1.5 Mbps to 1 Gbps is available to bundle with Prism service, with the maximum speed available dependent upon the network capability and the number of HD streams the customer elects with their video subscription. Approximately 90% of Prism subscribers also subscribe to our internet

1 See Attachment l .a(A)

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Access Service. Subscribers of our cable services in WI and IA may purchase Internet Access Service ranging from 1.5Mbps to 20 1v1bps, depending upon the network capability.

Similarly, telephony service is not included with video service but is available to bundle with video and Internet Access Service. Telephony plans vary by market and may include unlimited nationwide long distance.

For example, the foHowing telephony plans are available in AZ, CO and NE markets:

Basic Phone Unlimited local calling Can add long distance and calling features

Home Phone Unlimited local calling Eleven calling features Can add long distance

Home Phone Plus Unlimited local calling Eleven calling features $.05/min long distance

Home Phone Unlimited Unlimited local calling Eleven calling features Unlimited nationwide long distance

The fo1lowing telephony plans are available in CO, FL, MO, NC, NV and Wl markets:

Basic Phone Unlimited local calling Phone Plus Unlimited local calling

Ten calling features Can add long distance

Unlimited Phone Unlimited local calling Ten calling features Unlimited nationwide long distance

More information about CenturyLink Internet and Telephony plans can be found at: http ://www. centurylink. com/

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b. the residential locations for ·which the Company 's Internet Access Service is available and provide the number of residential subscribers by census block, technology and bandwidth as requested by the Internet Access Table (attached); and

Response :

CenturyLink does not track or maintain data at the level of detail requested. The response provided is the best data available consistent with the way we track this data. For this response Century Link utilizes intemal processes and data used for formulating FCC Form 477 data. To the extent possible, the processes and data were modified to conform to this request. The response is composed of four files which are provided as csv files. A description of each file follows:

Internet Access Attachment 1.b(A).csv This file contains residential subscriber data. as of 12/3112013 and contains the following fields:

date 2013 12 31 census tract Subscriber data for the FCC Form 477 is at the 2010 Census

Tract Level. CenturyLink is unable to provide this data at the Census Block level without a special study.

tech CenturyLirik reports subscriber data for FCC Form 477 for technologies of Asymmetric xDSL (teclmology code l 0), Optical Carrier/Fiber to the End User (technology code 50), and Fiber-to-the-Curb, reported as All Other {technology code 0). Century Link is unable to further segregate the xDSL data into ADSL2 and VDSL without a special study.

do-wn speed Downstream bandwidth of the service sold in Mbps. up speed Upstream bandwidth of the service sold in Mbps. residential subs Number of connections in this census tract for this

combination of teclmology code, upstream bandwidth and downstream bandwidth provided in consumer-grade service plans.

Internet Access Attachment l.b(B).csv This file contains residential subscriber data as of 06/30/2014 and contains the same fields and format in Internet Access Attachment A.csv. - - -

Internet Access Attachment l.b(C).csv This file contains deployment data as of 12/31 /2013 and contains the following fields:

date 2013 12 31 Block 15-character 2010 census block FIPS

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l tech CenturyLink reports this data as Asymmetric xDSL

I (technology code 10), Optical Carrier/Fiber to the End User (technology code 50), or Fiber-to-the-Curb, reported as All

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I Other (technology code 0). FCC Form 477 did not require this data to be further segregated into ADSL2 and VDSL

I until 06/30/2014. The 12/3 112013 data is not available at that level without a special study.

max down I Maximum advertised downstream bandwidth available in the -census block in Mbps

max_up Maximum advertised upstream bandwidth available in the census block in Mbps.

Internet Access Attachment 1.b(D).csv This file contains deployment data as of 06/30/201 4. It contains the same fields as Internet_Access_Attachm.ent_ C.csv. For the tech field CenturyLink was able to segregate the data into technology codes 10, 1 1, and 12, in addition to codes 50 and 0 (zero).

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c. separately, for each person from whom the Company purchases Transit Service or provides Peering, provide the data requested in the Purchases of Transit Service Table, Sales of Paid Peering Table, and Settlement-Free Peering Traffic Table (attached).

Response:

The Sales of Paid Peering Table is included as Attachment 1.c(A). Attachment 1.c(B) is the Settlement-Free Peeiing Traffic Table. The requested Purchases of Transit Service Table has not been provided since Century Link as a Tier-1 backbone provider of broadband internet access services, does not purchase transit services from a third party.

2. Explain or provide documents discussing:

a. the Company 's ability, as a provider of Internet Access Service over DSL technologies, to compete 11tith other Internet Access Service providers that offer that service at the same or Jaster speeds;

Response:

CenturyLink, as a provider ofinternet Access Service over DSL technologies, is able to effectively compete with other Internet Access Service providers that offer the service at the same or faster speeds.

[BEGIN HIGHLY CONFl.DENTIAL]

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[ENDIDGHLY CONFIDENTIAL] In the mass market broadband internet services market, regulated wire line telephone companies like Century Link compete vigorously with cable providers, wireless companies and other types of providers. Although offering competitive speeds is important in the high speed internet competitive market, the ability to offer competitive bundled solutions that include voice, video, and broadband is also a key competitive driver.

Century Link is generally the only facilities-based competitor to the local cable provider in markets we enter. Not unlike other industries, the consumer benefits of having a choice in facilities-based video providers include new capabilities and differentiated programming and pricing options.

Both federal and state regulators have recognized that broadband adoption increases significantly when it is offered along with video services, and that the federal goals of enhanced video competition and rapid broadband deployment are interre1ated2•

Comcast's added scale post-merger is likely to widen the gap in programming costs between it and smaller MVPD entrants like CenturyLink. Programming costs are aJready the single biggest variable cost for MVPDs and as such already drive up a new entrant MVPD's costs to enter a new market. Any increased dispa1ity in those costs between the incumbent cable provider and the smaller competitive MVPD will further undermine the competitor's ability to enter a new market. In tum, for Century Link this will also negatively impact deployment of higher internet speeds that would result from deployment of fiber deeper into the network to support Prism TV.

Additionally, the sky-rocketing costs of content are also substantially reducing the profitability of the video services we currently offer. This also adversely impacts the amounts we can invest to provide the higher Internet access speeds that consumers are demanding.

2 See e.g. Chairman Wheeler's Blog from Oct. 18, 2014, Teclmical Transitions, Video and the Future

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b. whether and to what extent increases in the speed of the Company's DSL-based Internet Access Service have allowed or would allow the Company to compete more effectively for Internet Access Service subscribers;

Response:

lBEGIN HIGHLY CONFIDENTIAL]

[END HIGHI,Y CONFIDENTIAL)

Ultimately, the inabi1ity for smaller companies to compete \vi th DSL offerings in these markets will harm the consumer) as effective Cable monopolies will be able to drive up prices and reduce service levels. Additionally, if the Comcast and Time Warner Cab]e merger is allowed to proceed, they will have a vested interest in more fiercely driving out competition and maintaining their monopolies, especially those with lPTV offerings, as witnessed with actions taken by Comcast to prevent IPTV competitors from acquiring franchises to compete.

Nevertheless, CenturyLink continues to invest in broadband services to meet our customer demand. We pass approximately 8 million homes with FTTN teclmology. In August of this year we announced that availability of symmetrical broadband speeds up to 1 gigabit per second to residential and business customers in select locations in 16 cities through our fiber network.

c. whether and to what extent the Company's ability to compete for Internet Access Service subscribers has been or would be increased if it were able to offer Internet Access Service using FTTP;

Response:

CenturyLink has successfully deployed FTf P in several markets, and is continuing to expand these offerings going forward when return on investment is acceptable. For example, in August of this year we armounced the availability of symmetrical broadband speeds up to 1 gigabit per second to residential and business customers in select locations in 16 cities through our fiber network. Still) with the high costs of fiber deployment, household installation, and equipment, any change to the competitive environment can alter the areas to which FTTP can be economically deployed. In those areas where Century Link FTIP is available) consumer demand for CenturyLink internet access services continues to grow.

[BEGIN HIGHLY CONFIDENTIAL]

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[ENDIDGHLY CONFIDENTIAL)

Speeds up to I Gpbs allow users to stream high-definition video content with little to no delays and download movies, songs and TV shows in seconds. Residential customers who have multiple devices connected to one Internet connection in the home '¥ill have more than enough capacity and speed to support other uses of broadband such as online gaming, home automation, and increasingly important cloud services.

CenturyLink's 1 Gbps service can provide businesses of all sizes with secure network capabilities and access to Century Link's ptivate and public cloud offerings and our more than 55 worldwide data centers. One gjgabit speeds help businesses increase productivity and efficiency by allowing them to gain instant access to cloud business applications, share multimedia files , stream video content, and back up data in real time. CenturyLink;s symmetricai upload and download fiber speeds of up to 1 Gpbs outperform the slower speeds available through many basic business broadband providers, including cable companies.

d. the Company's plans for capital investments that would increase the :,peed of the DSL-based Internet Access Service it offers, and the Company's reasons to make those investments;

Response:

CcnturyLink is constantly monjtoring our network to ensure that we are offering the speeds that our customers demand. We are actively evaluating technologies that enable faster speeds over our DSL-based Internet access services. For example, VDSL2 vectoring technology allows for high speed internet speeds up to 1 OOMbs. However, to maintain return on investment on DSL technology requires substantial density to overcome the capital costs. In the Century Link footprint, such densities arc harder to achieve.

CcnturyLink continues to upgrade our network including increasing the speeds of our DSL based Internet Access Services to keep up with consumer demand. Those decisions are made based on a variety of factors including but not limited to customer demand, customer density, cost of our network build, availability of facilities in the area, condition of the plant, and competition.

CenturyLink is engaged 111 several programs that will expand our DSL-based Internet access service, including expansions related to the merger of Century Link and Qwest in 2001, the FCC Connect America Fund, and various state incentive programs.

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e. the plans oj the Company to replace Internet Access Service that it currently provides over DSL with Inteniet Access Service over fiber to the premises (FTTP) and the Company's rationales in.favor of or against such replacements;

Response:

CenturyLink is constantly monitoring the marketplace to determine how best to spend our limited capital resources, including replacing our Internet Access Service provided over DSL with Internet Access Service over fiber to the premises. CenturyLink is not comfortable providing our FTTP investment plans in the context ofthis proceeding.

f. what download and upload speeds the Company believes are required to support internet usage.for video consumption by the average individual and by the average household, both at present and in the future; and

Response:

Today, Century Link generally offers Prism TV using broadband connections with speeds of between 25 and 40 Mbps. In locations where we have launched our full gigabit service, those customers are enjoying our video product using the incredible speeds enabled by our gigabit network. The bandwidth dedicated to the delivery of video services is expected to provide up to four concurrent HD video streams within the home. [BEGIN HIGHLY CONFIDENTIAL)

[END HIGHLY CONFIDENTIAL)

Consumer data usage wi lJ continue to grow and online traffic optimization techniques such as compression technology and adaptive bit rate technology continue evolve to enable more efficient use of bandwidth for high bandwidth consuming applications. Improvements in technologies like these may mitigate the need for higher speeds. It is unclear how these improvements will be balanced against an overall increase in online usage. However, this combination of factors creates a challenge in forecasting future bandwidth demand.

g. churn, subscriber acquisition and retention costs, including the Company's subscriber costs incurred in switching to another provider of Internet Access Service; and

Response:

(BEGIN IDGHL Y CONFIDENTIAL]

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[END IDG.fil, Y CONFIDENTIAL)

In contrast, Comcast, as a competitive entrnnt in the voice market, has no similar obstacle to obtaini11g a voice customer from CenturyLink. A telephone disconnect only requires a port and provides no opportunity for the current phone provider to retain the customer when they are cancelling their service. ln tum, in today' s market to provide voice, internet, and video to customers, Comcast has an advantage not only in retaining its existing customer base, but also in acquiring CenturyLink ' s existing customers. If, however, Comcast customers were enabled to cancel their Comcast video service via a letter of authorization provided to Comcast by their new provider, this would permit a Jess lopsided competitive landscape post-merger.

h. the reasons subscribers disconnect Internet Access Service or switch providers thereof, including but not limited to, pricing, quality of service and disputes between the Company and Edge Providers, CDNs or transii service providers.

Response:

Although Century Link representatives make inquiries regarding the reason(s) why our high speed Internet subscribers may choose to disconnect service .. vith us in favor of another provider of services, many customers choose not to provide that information. For those customers that provide a reason for switching to a competitive provider, the reason for the switch varies. For the period of October 2013 through September of 2014, CenturyLink customer service representatives recorded the following reasons for customers disconnecting their Internet access st..-rvicc with us:

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CenturyLink High Speed Internet Disconnect Reason Summary

October 2013- September 2014

Disconnect Reason Disconnect Reason Description Percent of Customers Disconnecting

{BEGIN CONFIDENTIAL]

[END CONFIDENTIAL]

Century Link does not specifically track disconnect reasons related to "disputes between the Company and Edge Providers, CDNs or transit service providers" . A customer disconnecting for those reasons would likely be captured within the "other" category.

3. Explain or provide documents sufficient to show the Company's policies or procedures with respect to decisions to establish or augment interconnection capacity with any CDNs, Internet backbone services, edge providers, Internet Access Service providers, and all other persons with whom the Company may engage in Internet Traffic Exchange.

Resoonse:

CenturyLink offers a variety of peering/interconnection arrangements with other networks including settlement-free peering, on-net Internet transit (content delivered to CentmyLink end­users only, and off-net Internet transit (content is delivered to both CenturyLink end-users and the full Internet).

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Our peering policy is pubhshed on our external website. Anyone interested in learning about the criteria necessary to qualify for a settlement-free peering arrangement with Century Link can view our policies using the foJlowing links:

• CenturyLink's North Amelican IP Network Peering Policy:

http://www. centurylink.corn/legal/peering_ na.html

• CenturyLink's International IP Network Peering Policy:

http:/ iv..rww .centurylink.com/ legal/peering_ int.htmJ

For settlement free arrangements, it is a long-held industry nonn for the provider that sends traffic in volumes that exceed the traffic-ratios established in the contract to have responsibility for augmenting interconnection capacity.

Customers can learn about the transit options available to them by visiting our website using the links below. Customers purchasing these services must specify their required capacity, the locations where traffic will be exchanged, and other terms and conditions regarding the arrangement. Our transit services are individually negotiated through a commercial agreement based on the needs of each individual customer. Century Link transit services are offered where facilities are available.

Our transit options are published publicly on our website using the fo1lowing links:

• IQ Internet Port: http://www.centurylink.com/business/products/products-and-services/data­

networking/intemet-port. html

• Data Hosting: http://www.centurylink.com/business/products/products-and-scrvices/hosting­

services/index .html

Today, edge providers already have a variety of techniques available that allow them to control the online experience of their end-users. At this time, it is difficult to predict how their traffic management techniques may evolve in the future and how that evolution may impact bandwidth demand.

In the meantime, large providers such as Google, Netflix, Ebay, Facebook, and Amazon already have considerable economic resources and, as a result, are able to leverage multiple paths for exchanging traffic and impact bandwidth demand for high bandwidth consuming applications. These include building or leasing their own physical networks and utilizing CDNs and thereby storing content close to the broadband provider and end users and bypassing backbone transit providers completely. Some large edge providers like Google own their own large scale content delivery networks.

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Edge providers frequently deploy multi-homing, a practice by which they buy Intemet transit from one or more providers through which they simultaneously exchange traffic. Edge providers using these types of arrangements are constantly managing the distribution to meet their individuaUy determined goals for cost and performance.

Large edge providers are also able to utilize a variety of other teclmologies and practices more broadly (e.g. Adaptive Bit Rate Streaming, caching, and device server optimization) that allow them to accomplish enhanced performance for their content and applications.

Even where these edge provider "fast lanes" may not exist, broadband Internet access is often determined by edge provider decisions about how to route traffic. Edge providers frequently vary their traffic delivery teclmiques for different content, different devices, and even different broadband providers. For example, Netflix chooses to route traffic differently to end users depending on whether they arc using a Blu-ray player, a tablet, a PC, Apple TV, or a PS3, etc.

Further demonstrating their control over customer experience, edge providers also engage in a variety of gamesmanship in order to contrive the appearance of a problem with broadband provider network management practices warranting regulatory intervention. It has been well publicized that edge providers such as Netflix, via their peering pa1tners, contrive the appearance of network congestion by refusing to move to industry-standard paid peering or other available arrangements when traffic becomes out of balance over settlement-free peering arrangements.

4. Provide the most recent regularly prepared network planning documents including but not limited to budgets and.financial projections regarding the expansion, development, deployment, and improvement of the Company's Internet Access Service.

Response:

Century Link is among the nation's largest providers oflntemet Access Services. We currently supply service at over 6 million customer addresses. In 2012 we added almost 200,000 customers and in 2013 about 140,000. Approximately 8 million homes are within the footprint of Century Link's FTTN tecluiology. Century Link is promoting and deploying service at 1 gigabit per second to an expanding base of customers. This very high speed service was available to parts of Omaha, Salt Lake City and Las Vegas in 2013 and in August 2014 CenturyLink announced that symmetrical broadband speeds up to I gigabit per second were available to residential and business customers in select locations in 16 cities. Thousands of customers could immediately begin enjoying the benefits of gigabit speeds and hundreds of thousands more will gain access to these services within the next 12 months. Century Link is using FTTP technology to provide this service to residential and business customers in select locations within ten cities and to business customers in an additional six cities as follows:

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Residential and Business Business

• Columbia, MO • Albuquerque, NM

• Denver, CO • Colorado Springs, CO

• Jefferson City, MO • Phoenix, AZ

• Las Vegas, NV • Sioux Falls, SD

• Minneapolis-St. Paul, MN • Spokane, WA

• Omaha, NE • Tucson, AZ

• Orlando, FL

• Portland, OR

• Salt Lake City, UT

• Seattle, WA

CenturyLink supplied commercial service at 100 Gigabits per second for the first time in 2013 and this complements wha.t is possible at 54 multi-tenant cloud computing centers on our 240,000 mile fiber network. Despite the challenge of serving many very sparsely populated p01tions of the nation, more than 90% of om customers have Internet Access Service availability and more than half of those customers have the option to purchase seryjce at speeds of 10 Megabits per second and higher.

In 2012, Century Link launched a three-year plan to expand Internet Access Service to 45,289 customers who formerly had no service availability. This plan was stimulated by the FCC Connect America Fund Phase I (CAF I) initiative. In early 2014, Century Link embarked on a second three-year CAP I p lan, very similar to the 2012 plan, but targeting a separate base of underserved customers in rnral areas. Exclusive of these plans, Century Link is midway through a seven-year Internet Access Service expansion plan launched at the time of the merger of Qwest and CenturyLink in 2011. That plan covers the 14-state Qwest-affiliate footprint only, and the plan's status and objectives are:

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7 Years from % LUs as of Rural Non-Rural

Merger Close 6/30/14 6/30/14 6/30/14

(4/1/18)

objective actual actual actual !Living Units with !Access to at Least 1.5 92.7% 90.6% 83.0% 94.9% Mbps Downstream Living Units with !Access to at Least 5 78.8% 70.4% 58.7% 76.6% Mbps Downstream Living Units with Access to at Least 12 60.0% 55.7% 40.2% 63.5% Mbps Downstream Living Units with Access to at Least 40 30.0% 25.3% 11.9% 31.5% Mbps Downstream

CenturyLink is also working with industry and the FCC on the multi-year FCC Connect America Fund Phase II (CAF II), whjch is expected to be offered to Century Link and other local providers during 2015. Century Link supports the current proposal by the FCC to provide Internet Access Service at 10 megabits per second to customers who do not have availability of such speeds at this time. CenturyLink's level of investment, in addition to any suppo1t provided by CAF II, would be unprecedented.

On a much smaller scale and more focused basis, various state and local governments have offered incentives and encouragement to expand Internet Access Service to clusters of customers. These programs typically require hundreds of thousands or single milJions of dollars rather than tens or hundreds of millions of dollars for comparable federal programs. CenturyLink supports and participates in these programs, such as the broadband program in Nebraska, and a waits confirmation of several additional programs.

Demand for wireless broadband service has driven serious and competitive demand for fiber­based transport from wireless carriers. In 2013 Century Link placed fiber to 4100 towers to expand the base to 18,800 fiber-enabled towers. By year-end 2014, we plan to have added 3500 adrutional towers and yet about 28% of the towers in our local serving area will remain unserved at year-end.

Finally, a generous portion of what has been Century Link's multi-billion dollar annual capital outlay is devoted to expansion of Internet Access Services. The primary driver of decisions associated with the location of network modernization investment is competition. Currently Comcast is Century Link's most formidable competitor for Internet Access Services.

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5. Provide examples oj or documents sufficient to demonstrate examples of negotiations between the Company and another person that did not result in an agreement.for the Company to acquire any rights (linear or non-linear) to distribute broadcast or non­broadcast, video programming from that other person and, if possible, explain the Company's view as to whether such negotiations failed because of (i) any economic or non­economic Most-Favored-Nation clause in a conJracl with another person; (ii) grants to distribute programming exclusively to another person; or (iii) any oth er limits by another person on the distribution of the programming being negotiated.

Response:

[BEGIN CONFIDENTIAL]

[END CONFIDENTIAL]

6. Explain the Company 's use of data caps or usage allowances, including ji1ture plans for such data caps or usage allowances, and how such plans are or would be qffected by the decisions of competing cable providers and competing DSL providers to impose data caps or usage allowances.

Response:

The CenturyLink Excessive Use Policy sets download guidelines based on the High-Speed Internet service plan that a customer purchases. It states:

CenturyLink is committed to providing an optimum Internet experience for every customer we serve. To accomplish this, Centurylink needs to ensure that customers are on the rate plan that meets their data download requirements. Of the millions of Centurylink High-Speed Internet customers, a very small fraction has exceeded the download usage limits provided with their monthly plan.

It is for this reason that Centurylink has made the decision to place download limits on residential plans. This policy only impacts residential customer plan download usage; upload usage is not impacted. It does not impact business class High-Speed Internet plans. Residential 1 Gbps plans are not subject to download limits. High-Speed Internet and video traffic associated with Prismni TV service is not subject to the CenturyLink EUP.

Centurylink will not charge a fee for excessive download usage. Centurylink will weigh variables such as network health, congestion. availability of customer usage data, and the line speed purchased by the customer as factors when enforcing this policy. Customers who are subject to EUP enforcement, will receive a web notification and/or written oommunicatlon from Centurylink providing notice that they have exceeded their usage limit .

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Customers will be given options to reduce their usage, subscribe to a higher speed residential plan, or migrate to an alternative business class High-Speed Internet service. Our EUP is application neutral; it only considers the total usage (bytes transferred) over a defined period of time independent of protocols, applications, or the content that is generating the excessive usage.

CenturyLink's download guidelines are designed to support today's usage patterns. Our plans include the following download usage limits:

• 1.5Mbps plans - 150 Gigabytes

• Plans greater than 1.5Mbps - 250 Gigabytes

View questions and answers (PDF) about the Excessive Use Policy (EUP).

The Excessive Use Policy is included in our Network Management disclosure found on our website at: http://www.centurylink.com/Pages/ AboutU s/Legal/InternetServiceManagement/

Many competing high speed intemet providers already impose data caps and usage allowances. We periodically review our excessive use policy to evaluate whether our usage limits are in line with current usage patterns. We consider many factors, including competitors ' usage limits, internal customer usage patterns, network technology advancements, and the expected impact of emerging web applications, in making a decision to alter our own usage limits.

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