About VERIZON BUSINESS GLOBAL LLC

Verizon Communications is the #1 wireless phone service in the US (ahead of rival AT&T Mobility) and the #2 US telecom services provider overall (after AT&T ). The company's core mobile business, Verizon Wireless, serves more than 146 million connections. Verizon's wireline unit, with more than 18 million voice connections, provides local telephone, long-distance, internet access, and digital TV services to residential and wholesale customers. In addition, Verizon offers a wide range of telecom, managed network, and IT services to commercial and government clients in more than 150 countries. Verizon has expanded its video and advertising capabilities with the acquisitions of AOL and Yahoo assets.

Operations

Verizon Communications' Verizon Wireless segment accounts for 70% of revenue. It operates one of the most extensive wireless networks in the US and the largest 4G LTE and third-generation Evolution-Data Optimized (EV-DO) networks. The 4G LTE network is available to more than 98% of the US population.

The wireline segment, which provides about a quarter of revenue, provides voice, data, and video communications products, and enhanced services, including broadband video and data, corporate networking services, data center and cloud services, security and managed network services, and local and long distance voice services. AOL and Verizon's telematics business are included in the wireline segment. The segment also includes Verizon's Fios service, which offers high-speed internet and TV. The company reported nearly 6 million Fios internet and close to 5 million Fios video subscribers at the end of 2016.

A corporate category supplies about 5% of revenue.

Geographic Reach

Verizon is all over the horizon, with a network that stretches across the US and offices in more than 150 countries. The company conducts research in San Francisco and Waltham, Massachusetts.

Sales and Marketing

Verizon sells its prepaid and postpaid wireless phone services through its website, its own stores, and national retailers such as Best Buy, Target, and Wal-Mart. It also has a dedicated telemarketing sales force. The average retail customer account pays about $144 a month.

The company is a major advertiser, with a coordinated program of TV, print, radio, outdoor signage, internet, and point-of-sale media promotions. Those Verizon ads, commercials, and other promotional vehicles cost the company about $2.7 billion a year, which is about two-thirds of what AT&T spends on advertising.

Financial Performance

After several years of riding the wireless wave, Verizon's 2016 financial performance stumbled in the wake of changes in pricing plans. Revenue dropped 4% to about $126 billion in 2016 from about $132 billion in 2015. Service revenue fell about $4 billion in 2016 because of lower retail postpaid service revenue as customers flocked to unsubsidized service pricing. Equipment revenue rose about $600 million in 2016 from better sales of smartphones under the company's device payment program. Revenue from the wireline business decreased about 2% in 2016 from declines in Global Enterprise and Global Wholesale as well as a reduction in Fios marketing activities during a month-and-a-half long union work stoppage.

Verizon's net income slumped 27% to about $13 billion in 2016 from about $18 billion in 2015. The lower profit resulted mainly from the revenue decrease as the company's operating expenses increased just $361 million in 2016 from 2015.

Cash flow from operations was $23 billion in 2016, down from about $39 billion in 2015. Some of the difference came from a change in how Verizon monetizes device payments. It changed them from receivables to asset-backed securitizations. That switches the proceeds from operating activities to financing activities. It means Verizon reports lower cash flow from operations, but does not reduce the cash available to run the business.

Strategy

When its rivals slash prices on wireless service, Verizon Communications touts the coverage, speed, and reliability of its network. Maybe it costs a bit more, Verizon tells customers, but the network is worth it. Verizon is investing to expand and strengthen the network to develop new streams of revenue.

The company has committed to spend about $1.4 billion over the next three years to extend its fiber optic cable network to improve 4G service and get ready for higher-speed 5G service in a few years. It has contracted with Corning and the Italian fiber cable maker Prysmian to supply more than 20 million fiber miles over the next several years. In 2017 Verizon shelled out another $1.8 billion to buy the fiber network business of XO Communications. The deal included metro rings in 45 of the top 50 US markets.

In Boston, Verizon is installing a fiber network to deliver high-speed service to businesses and consumers. It plans to build similar networks in several other markets. In another network bolstering move, Verizon is installing small cell antennas on utility poles and the like to improve network density and relieve network congestion.

While wireless telephone service remains Verizon's main business, the company is moving into markets that leverage its network. With its telematics and Smart City initiatives, Verizon looks to monetize data traffic through Internet of Things applications.

Verizon wants to use its network to deliver its own content. Its acquisitions of AOL and Yahoo (which closed in June 2017) provide it with advertising technology and a range of content that could open new revenue streams. Verizon maintains its go90 video platform with content aimed millennials; daily use was about 30 minutes per view in 2016. It also plans to launch a streaming service in 2017.

The company has assembled a digital rights portfolio that includes the NFL and NBA and provides enhanced viewing options for Verizon wireless customers. In 2017, Verizon agreed to pay about $20 million to stream over the internet an NFL game from London. Verizon can stream the game on any of its properties, including AOL and Yahoo.

Mergers and Acquisitions

Verizon Communications agreed to buy Straight Path Communications for more than $3 billion, gaining a trove of 28 GHz and 39 GHz millimeter wave spectrum used in mobile communications. The spectrum could give Verizon a boost in developing 5G technology. Verizon outbid AT&T for Straight Path.

In 2016 Verizon bought Fleetmatics, a telematics company, for about $2.4 billion. Verizon made Fleetmatics a part of its telematics unit that focuses on fleet management, mobile workforce services, and the Internet of Things.

Verizon acquired XO Holdings' wireline business, which owns and operates one of the largest fiber-based IP and Ethernet networks, for about $1.8 billion in February 2017. The purchase extends Verizon's fiber tracks in the US.

Verizon's acquisition of AOL provides the carrier with boosts in traffic for mobile and video as well as a strong presence in programmatic advertising. AOL's ad technologies are to enable Verizon to more precisely place ads in front of willing buyers. AOL also brought several high-profile content sites, including the Huffington Post, TechCrunch, and Engadget.

The Yahoo purchase, which concluded in 2017, brings some one billion users, including 600 million on mobile devices (according to Yahoo figures) to Verizon. The deal includes Yahoos news, finance, and sports websites as well as Flickr and Tumblr. Also important are the advertising assets that Brightroll, a programmatic ad platform; Flurry, a mobile apps analytics service; and Gemini, a native and search advertising service. Verizon was the winning bidder in a process that took several months to work through. In early 2017, Verizon lowered the amount it would for Yahoo by $350 million, bringing the deal's value to $4.48 billion. The move came after several hacking episodes exposed Yahoo to liabilities. As part of the rejiggered deal, the companies will split certain legal and financial liabilities.

In 2016 Verizon agreed to acquire Volicon, a provider of video capture, archival, compliance monitoring and clip creation workflow. The acquisition expands Verizon Digital Media Services as a provider of technology and media services for broadcast and online video.

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VERIZON BUSINESS GLOBAL LLC

22001 Loudoun County Pkwy
Ashburn, VA 20147-6105
Phone: 1 (703) 886-5600

Stats

  • Employer Type: Public
  • Senior Vice President: Martin Burvill
  • Group President worldwide Sales: D B Crump
  • Executive Managing Director: Norman King
  • Employees: 40,000

Major Office Locations

  • Ashburn, VA

Other Locations

  • Montgomery, AL
  • Prattville, AL
  • Phoenix, AZ
  • Anaheim, CA
  • Cupertino, CA
  • Lodi, CA
  • Los Angeles, CA
  • Palmdale, CA
  • Rancho Cordova, CA
  • Rialto, CA
  • Riverside, CA
  • San Diego, CA
  • San Francisco, CA
  • San Jose, CA
  • Santa Ana, CA
  • Santa Clara, CA
  • Sunnyvale, CA
  • Colorado Springs, CO
  • Denver, CO
  • Westminster, CO
  • Stamford, CT
  • Washington, DC
  • Boca Raton, FL
  • Clearwater, FL
  • Cocoa, FL
  • Daytona Beach, FL
  • Doral, FL
  • Fort Lauderdale, FL
  • Jacksonville, FL
  • Miami, FL
  • Pensacola, FL
  • Tallahassee, FL
  • Tampa, FL
  • Alpharetta, GA
  • Atlanta, GA
  • Augusta, GA
  • Hinesville, GA
  • Martinez, GA
  • Savannah, GA
  • Clear Lake, IA
  • Boise, ID
  • Chicago, IL
  • Downers Grove, IL
  • Hinsdale, IL
  • Morris, IL
  • Fairdale, KY
  • Louisville, KY
  • New Orleans, LA
  • Burlington, MA
  • Baltimore, MD
  • Silver Spring, MD
  • Farmington Hills, MI
  • Royal Oak, MI
  • Southfield, MI
  • Traverse City, MI
  • Troy, MI
  • Minneapolis, MN
  • Jefferson City, MO
  • Jackson, MS
  • Cary, NC
  • Charlotte, NC
  • Hamlet, NC
  • Manchester, NH
  • Carteret, NJ
  • West Orange, NJ
  • Albany, NY
  • Brooklyn, NY
  • Buffalo, NY
  • New York, NY
  • Rochester, NY
  • Akron, OH
  • Cincinnati, OH
  • Hilliard, OH
  • Niles, OH
  • North Royalton, OH
  • Broken Arrow, OK
  • Eugene, OR
  • Portland, OR
  • King Of Prussia, PA
  • Mechanicsburg, PA
  • Philadelphia, PA
  • Elgin, SC
  • Sioux Falls, SD
  • Knoxville, TN
  • Austin, TX
  • Dallas, TX
  • El Paso, TX
  • Garland, TX
  • Houston, TX
  • Richardson, TX
  • Wylie, TX
  • Salt Lake City, UT
  • Hardy, VA
  • Mc Lean, VA
  • Newport News, VA
  • Quicksburg, VA
  • Reston, VA
  • Roanoke, VA
  • Seattle, WA
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