Raymond James 32 nd Annual Institutional Investors Conference Tony - - PowerPoint PPT Presentation

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Raymond James 32 nd Annual Institutional Investors Conference Tony - - PowerPoint PPT Presentation

Raymond James 32 nd Annual Institutional Investors Conference Tony Melone Executive Vice President & Chief Technology Officer March 9, 2011 Safe Harbor Statement NOTE: This presentation contains statements about expected future


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March 9, 2011 Tony Melone Executive Vice President & Chief Technology Officer

Raymond James 32nd Annual Institutional Investors Conference

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SLIDE 2

“Safe Harbor” Statement

NOTE: This presentation contains statements about expected future events and financial results that are forward-looking and subject to risks and uncertainties. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The following important factors could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: the effects of adverse conditions in the U.S. and international economies; the effects of competition in our markets; materially adverse changes in labor matters, including workforce levels and labor negotiations, and any resulting financial and/or

  • perational impact, the effect of material changes in available technology; any disruption of
  • ur key suppliers’ provisioning of products or services; significant increases in benefit plan

costs or lower investment returns on plan assets; the impact of natural disasters, terrorist attacks, breached of network or information technology security or existing or future litigation and any financial impact not covered by insurance; technology substitution; an adverse change in the ratings afforded our debt securities by nationally accredited ratings

  • rganizations or adverse conditions in the credit markets impacting the cost, including interest

rates, and/or availability of financing; any changes in the regulatory environments in which we

  • perate, including any increase in restrictions on our ability to operate our networks; the

timing, scope and financial impact of our deployment of broadband technology; changes in our accounting assumptions that regulatory agencies, including the SEC, may require or that result from changes in the accounting rules or their application, which could result in an impact

  • n earnings; our ability to complete acquisitions and dispositions; and the inability to

implement our business strategies.

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SLIDE 3

Capitalize on strategic network investments

Key Priorities

  • Accelerate revenue growth
  • Expand margins and improve profitability
  • Ensure network performance and reliability
  • Effectively deploy new technologies
  • Increase investment returns

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SLIDE 4

Market Trends

  • Significant market demand for increasing network speeds
  • Broadband access and households online growing
  • Video evolving to anytime, anywhere & on any device
  • Businesses shift towards secure IP & managed services
  • Significant growth in cloud computing services

Market trends favoring Verizon's integrated asset portfolio

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SLIDE 5

Market Trends - Video

Digital media and growth of connected devices driving market

Number of videos watched per day at YouTube

2

Billion

Growth rate of mobile video consumption

52

Percent

Daily video viewing for the average American across devices in 2010

5+

Hours

Of consumers would like to view videos or downloaded content from the Internet

  • n their television

65

Percent

Of Internet traffic will be video by 2014, 56% will be streaming video

91

Percent

The increase in consumer consumption of online video between 2008 & 2009

84

Percent

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SLIDE 6
  • 10x number of users with each cycle
  • 44x data growth by 2020
  • Access speed demand

growing to 100 Gpbs by 2015

Market Trends - Global IP and the Cloud

The Cloud – A complementary new growth opportunity

1970s Mini Computing 1980s Client / Server Computing 1960s Mainframe Computing 1990s Desktop Internet Computing 2000s Mobile Internet Computing 2011+ “Everything-as-a-service”

$120B 5yr Growth Market Gartner Forecast IDC Forecast $0 $50 $100 $150 2011 2013 2015 2020

2011-2020

CAGR 19%

2011-2015

CAGR 35%

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SLIDE 7

Network Overview

Superior global assets, strong strategic position

  • Business Apps Access
  • Communication Apps
  • Enable Mobile Apps
  • SMB Services
  • Digital Voice

Global IP

  • Application Store
  • Open Development
  • M2M Platform
  • Hosted Mobile Apps
  • Vertical Solutions
  • FlexView
  • Video
  • Verizon.net Services

Cloud Services

  • Cloud Computing
  • Business Platforms

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SLIDE 8

Global Capabilities

Global market position… a powerful enabler

  • $16B enterprise revenue

in 2010

  • Offices in 75 countries
  • 200 Data Centers
  • Over 3,000 Professional

Service consultants

  • IP Network in 2,700 cities,

159 countries

  • ~180K Customers
  • #1 in Security Services
  • Premier Global Network

Service Provider

  • Strengthening Vodafone

relationship

Security Global Network Professional Services Data Centers

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SLIDE 9

Private Network Private Network Public Network Private Network

Verizon 100G ULH Backbone

Public Network Public Network 100Gb E 100Gb E 100Gb E 100Gb E 100GbE 100Gb E 100Gb E 100Gb E Private Network Public Network

Verizon Wireless Verizon Wireless Verizon Wireless

P-OTP P-OTP P-OTP P-OTP P-OTP P-OTP

Wireless/ LTE Customers

Verizon Regional Data Center Verizon Regional Data Center Verizon Regional Data Center

Verizon National Data Center

Cloud Services

Verizon National Data Center

Cloud Services Verizon Wireless

P-OTP P-OTP

Broadband Home

P-OTP P-OTP

Verizon Regional Data Center

Data Center Integration with IP Network

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SLIDE 10

Verizon Network Cloud

Partner Port Delivery over Managed Networks & Internet Smart Network

IMS Video Services Security Services Cloud Computing

Delivery Node Competitor Cloud Services

Delivery Node Delivery Node Delivery Node Delivery Node

New Revenue, faster interactivity, efficient use of network

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IP/MPLS IPv6 100+ Gbps Ultra Long Haul Optical Control Plane Optical Switching Mesh Networking

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SLIDE 11

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Enterprise Cloud Opportunity

A Verizon Company

Terremark accelerates the cloud opportunity for Verizon

  • Global portfolio of advanced

voice, data, IP, IT and security solutions

  • Leader in Cloud

Infrastructure as a Service and Web Hosting

  • Leader in Managed Security

Services

  • 16 Premium Data Centers

and 5 Smart Data Centers in US, Europe and Asia

  • Leading global provider of

managed IT infrastructure services

  • Innovative technology

platform delivering cloud, security and managed hosting services

  • 13 data centers in the US,

Europe and Latin America

  • Leading cloud services

provider

  • Leader in managed security

services

  • One of the largest managed

hosting companies

  • Global data center footprint
  • Comprehensive services

portfolio

  • Agile innovator in secure IT

and cloud services

  • Unified enterprise IT

platform

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SLIDE 12

FiOS

FiOS investment continues to enable enhanced products

  • Delivering on commitment to

pass 18M premises

  • 15.6M premises passed at

end of 2010

  • 60% of footprint covered by

FiOS with goal of 70% coverage

  • 32% FiOS Internet data and

28% FiOS TV penetration

  • Significant upside potential

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FiOS Evolution

  • Leading Broadband Platform

– 150/35 Mbps 2010, 1 Gbps future – NGPON Trials – Enabling business services

  • Cost Efficiencies

– 1x64 Design – Longer-reach optics

  • FiOS Enhancements

– Full-HD 3D – Channel expansion – Consumer electronics integration

  • Blu-ray
  • BB enabled TVs
  • Game consoles
  • Tablets, smartphones
  • IP set-top boxes

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Fiber solutions enhance capabilities and efficiencies

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SLIDE 14

Wireless 3G

Largest, most reliable wireless voice and 3G data network in U.S.

  • Reliability
  • Consistency
  • Coverage
  • Utility

Motorola Droid 2 Global Apple iPhone 4 Samsung Galaxy iPad MiFi

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SLIDE 15

Motorola XOOM

Wireless 4G LTE

Technology leadership, innovation and data driving growth

  • Capabilities

– Speeds up to 10 times faster – Cuts latency in half – Superior in-building penetration

  • Enhanced value proposition

– Quality of service – Enhanced product offerings – Billing capabilities

2013: 290M POPs 2012: 200M POPs

M2M Samsung Galaxy HTC Thunderbolt

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Wireless Advanced Devices

Well positioned to support future growth

Smartphone / Data Device Growth

Smartphone Penetration (Retail postpaid base)

Postpaid Data ARPU 10% 15% 26% $15.80 $18.83 2008 2009 2010 2011 Est.

  • Doubling data capacity to

support increased usage each year

  • Improved throughput
  • Consistent investment in cell

sites, spectrum and backhaul

50%+

USB Modems Mobile Hotspots Netbooks Tablets Smartphones

$12.89

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SLIDE 17

Licenses Covering 87% of U.S. Population Average Nationwide Depth: 29 MHz

2000

Wireless Spectrum

Strong spectrum depth and breadth

Licenses Covering 100% of U.S. Population Average Nationwide Depth: 88 MHz

2010

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SLIDE 18

700 MHZ Coverage Comparison

Each frequency has a different rate of energy decay, with higher frequencies decaying faster Relative Distance 1x

2500 MHZ BRS

1.3x

1900 MHZ PCS

2.9x

800 MHZ Cellular

3.5x

700 MHZ VZW LTE

1.18x

2100 MHZ AWS

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700 MHz delivers superior coverage

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SLIDE 19

LTE Enhancements

Microcells

Capacity

  • Public Safety, VoIP, Enterprise, Video
  • Best Effort
  • Machine to Machine
  • YouTube, Hulu, Facebook
  • Video telephony
  • Premier content

Quality of Service (QoS) Video

Additional Spectrum

Service Management

Bandwidth Latency Meet customer requirements

Video Optimization

Optimization Efficiency Quality of experience

Growth Strategy

Smaller cells More spectrum Technology enhancements Picocells

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SLIDE 20

Collaboration & Partnering

LTE Innovation Center

(Waltham, MA)

Application Innovation Center

(San Francisco, CA)

4GVF

(Basking Ridge, NJ)

+ =

Devices Applications Differentiated Services

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SLIDE 21

Network Summary

Leveraging our integrated asset portfolio for success

  • Business Apps Access
  • Communication Apps
  • Enable Mobile Apps
  • SMB Services
  • Digital Voice

Global IP

  • Application Store
  • Open Development
  • M2M Platform
  • Hosted Mobile Apps
  • Vertical Solutions
  • FlexView
  • Video
  • Verizon.net Services

Cloud Services

  • Cloud Computing
  • Business Platforms

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