Verizon Communications, Inc., provides broadband and telecommunications services to more than 100 million personal and business consumers. It was formed on June 30, 2000, with the merger of Bell Atlantic Corporation and General Telephone and Electronics Corporation (GTE). It was one of the largest mergers in United States business history, valued at more than $52 billion at the time of the announcement. The merger began on July 27, 1998, and took almost two years, until June 30, 2000, to become effective. Verizon began trading on the New York Stock Exchange on July 3, 2000, and in 2004, its shares became a part of the Dow Jones Industrial Average. Its line of businesses includes television, wireless telephone, local wireline telephone, and broadband internet services. According to the Fortune 500 list of 2007, Verizon is the 13th-largest company in the world. Verizon currently employs approximately 235,000 people and serves customers in more than 140 countries. It had operating revenues of $93.5 billion and operating income of $15.6 billion in 2007. Verizon has its corporate headquarters in Manhattan.
Although Verizon is a relatively new company, its parent companies have a long history of operating in the telecommunications industry. Both Bell Atlantic and GTE had grown and evolved through a series of mergers, acquisitions, and divestitures. Prior to the merger, GTE and Bell Atlantic were among the largest telecommunications companies in the world. In
1999 GTE had revenues of more than US$25 billion, while Bell Atlantic had revenues of more than US$33 billion. GTE served approximately 35 million access lines in the United States, Canada, the Dominican Republic, Puerto Rico, and Venezuela. It was the leading wireless service provider in the United States, serving 7.1 million customers. It provided wireless services to more than 6.7 million customers outside the United States. Bell Atlantic’s domestic telecom unit had 43 million access lines. Its wireless global unit managed 7.7 million customers in the United States and also served Latin America, Europe, and the Pacific Rim.
The different businesses of Verizon are clubbed in two segments—Wireline and Wireless. As of March 2008, Wireless has a 49 percent share in revenues, while Wireline has a 51 percent share. In terms of operating income, Wireless has a 75 percent share, while Wireline has a 25 percent share. Verizon’s Wireline operations include Verizon Telecom and Verizon Business. Verizon Telecom provides local and long-distance telephone services, broadband video and data services, and other communication services to consumers and small and medium-sized businesses in 28 states in the United States. It has over 40 million access lines, 8.5 million broadband connections, and approximately 2.15 million video subscribers.
Verizon Business was formed in 2006 when Verizon acquired MCI, Inc. This acquisition made Verizon the largest telecommunications company in the United States, until BellSouth and AT&T merged, which relegated Verizon to second place. It is a leading provider of innovative communications and information technology solutions to large businesses and governments in 150 countries around the globe. Verizon Business has a customer base of over 70,000, which includes 97 percent of the Fortune 500.
Verizon’s wireless business segment operates as Verizon Wireless, which is a joint venture between Verizon Communications and United Kingdom– based Vodafone Airtouch, with Verizon holding majority ownership (55 percent). Verizon Wireless began its operations on April 3, 2000. Soon after, GTE’s wireless operations also joined Verizon Wireless. It provides wireless voice and data products and services as well as equipment sales to over 67.2 million customers across the United States. Based on revenue, Verizon Wireless is the largest American wireless company and largest wireless data provider, with annual revenue of $43.9 billion as of 2008. This wireless network is 100 percent digital.
Verizon’s main competitors include AT&T, Cablevision, Comcast, Cox Communications, Time Warner Cable, and Alltel. In spite of a very competitive industry, Verizon has been able to maintain its competitiveness, both in terms of quality of services and customer satisfaction, because of the reliability of its networks. Its wireless network is the most reliable network in the nation and its wireline network has a reliability factor of 99.99 percent. Verizon has topped the American Customer Satisfaction Index for four years running.
- Verizon, “Business Units,” investor.verizon.com/business (cited March 2009);
- Verizon, “Corporate History,” investor.verizon.com/profile/history (cited Marc 2009).
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