About ENTURYTEL.COM, LLC

CenturyLink provides cyber links throughout the country on one of the longest fiber networks in the US. Historically a regional wireline local and long-distance telephone provider, it's connecting with the times by transforming into a broadband and network services provider for business, residential, and government clients. It spends around $3 billion a year on capital costs to further develop its network. The company is the one of the largest US wireline telecom companies by total access lines (it has about 11 million of them), and is the incumbent local carrier in nearly 40 states, though three-quarters of its lines are in just a dozen. In 2016 CenturyLink and Level 3 Communications agreed to merge in a $34 billion deal.

Operations

CenturyLink operates in two main segments with the Business segment accounting for 60% of sales. It provides private line, broadband, Ethernet, Multiprotocol Label Switching (MPLS), Voice over Internet Protocol (VoIP), network management services, colocation, and managed hosting and cloud hosting services for enterprise, wholesale, and governmental customers, including other communication providers.

The Consumer segment, about a third of sales, offers broadband, wireless, and video services, including Prism TV service and an over-the-top streaming service. It also offers local and long-distance phone service as well as satellite TV through DirecTV and wireless service through Verizon.

The company's "other" segment, which includes federal payments for serving rural areas, accounts for the rest of revenue.

CenturyLink operates a 265,000-route-mile US fiber network in the US and a 360,000-route-mile international transport network.

Geographic Reach

CenturyLink operates about 75% of its total access lines in portions of Arizona, Colorado, Florida, Iowa, Minnesota, Missouri, New Mexico, Nevada, North Carolina, Oregon, Utah, and Washington (the company has paid a reported $75 million to put its name on the Seattle Seahawks stadium on the city's waterfront for 15 years).

It also provides local service in parts of Alabama, Arkansas, California, Georgia, Idaho, Illinois, Indiana, Kansas, Louisiana, Ohio, Michigan, Mississippi, Montana, Nebraska, New Jersey, North Dakota, Oklahoma, Pennsylvania, South Carolina, South Dakota, Tennessee, Texas, Virginia, Wisconsin, and Wyoming.

Financial Performance

CenturyLink's revenue dropped about 2% in 2016 to $17.5 billion from 2015, continuing a string of incremental declines over the past five years. Business segment sales fell 3% in 2016 from 2015 mainly on declines in legacy services revenues from fewer in local service access lines and lower volumes of long-distance and access services. The continued erosion of legacy services (traditional phone service) also drove the consumer segment's revenue 2% lower in 2016 from 2015. Revenue from strategic services rose in the business and consumer segments from increased MPLS, Ethernet, and VoIP services in business, and rate increases and pricing initiatives for broadband and Prism TV in consumer.

The company reported net income of $626 million in 2016, a 29% drop from 2015. Although the company had lower expenses for the most part in 2016, they didn't outweigh the drop in revenue.

Cash flow from operations slipped to $4.6 billion in 2016 from $5.1 billion in 2015 on lower net income.

Strategy

The network is at the heart of CenturyLink's business and its strategy. Already big with 265,000-route miles of fiber in the US, the network is poised to get even bigger with CenturyLink's pending acquisition of Level 3 and its 200,000 route miles of fiber. The company delivers video streaming, applications and services related to the Internet of Things (IoT), and emerging technologies like virtual and augmented reality and still-to-come 5G wireless technology over the network.

Besides extending its network, the Level 3 deal would add to the revenue CenturyLink gets from business customers. CenturyLink's business revenue, which is more stable and carries higher margins, would rise to 75% of sales from 60%. Recently introduced products and services geared to businesses include cloud, data analytics, and security offerings.

The consumer remains an integral part of CenturyLink's plans. The company is working to improve network speeds and the customer experience. It has invested in broadband to supply speeds of 100 Mbps to 1 Gbps to more service areas. The company also has simplified its pricing plans and offers an over-the-top (OTT) video service for cord-cutters.

On the operations side, CenturyLink implemented cost-containment moves in 2016 that included reducing employee-related expenses up to 8%.

CenturyLink sold its data centers and colocation business in 2017 for about $1.8 billion to a consortium of investors who formed Cyxtera Technologies. CenturyLink maintained an ownership stake in the new business and can sell services to its customers.

Mergers and Acquisitions

The proposed $34 billion-dollar merger of CenturyLink and Level 3 Communications would create one of the largest telecommunications service providers in the US. The combined company would own a network that connects more than 350 metro areas in the US and it would have a presence in more than 60 countries. While each company has a nationwide network, they say their combination would bring together complementary assets and not result in less competition. With Level 3 carrying some $10 billion in net operating losses, the combined company's tax bill would be low, freeing up cash flow for developing more infrastructure. The deal is expected to close by the end of 2017.

CenturyLink expanded its capabilities in IT services with the acquisition of SEAL Consulting, a provider of SAP tools for enterprise business and technology needs.

In 2016 CenturyLink added a security element to its networking business with the acquisition in 2016 of netAura. The company specializes in engineering, developing, and consulting on managed security technologies.

- Show Less + Show Full Description

ENTURYTEL.COM, LLC

100 Centurylink Dr
Monroe, LA 71203-2041
Phone: 1 (318) 388-9000
Fax: 1 (318) 338-2418

Stats

  • Employer Type: Public
  • Vice President: Emmett McDaniel
  • Senior Vice President: Maxine Moreau
  • Vice President Sales: Cassandra Walters
  • Employees: 20,300

Major Office Locations

  • Monroe, LA

Other Locations

  • Flagstaff, AZ