Cincinnati Bell

Business Data Service in an Internet Protocol Environment, WC Docket No. 16-143

Special Access Rates for Price Cap Local Exchange Carriers, WC Docket No. 05-25 and RM-10593

Cincinnati Bell Services & Subsidiaries

 Entertainment & Communications Services • Cincinnati Bell Company (“CBT”) – ILEC serving greater Cincinnati for over 140 years • Cincinnati Bell Extended Territories (“CBET”) – CLEC serving areas around Dayton and Mason, • Cincinnati Bell Any Distance (“CBAD”) – CLEC and long distance provider • eVolve Business Solutions (“eVolve”) – VoIP service provider

 IT Services and Hardware • Cincinnati Bell Technology Solutions (“CBTS”)

2 Cincinnati Bell ILEC Territory

3 Yesterday and Today

2006 2016 Voice Lines 887,000 525,000 DSL Internet Subs 198,000 121,700 Fioptics Internet Subs -- 175,000 Video Subs -- 126,800

2015 Revenue Total Cincinnati Bell Inc. $1,167.8 million Entertainment & Communications 743.7 million

4 Investing in the Future

 More than $700 million spent on fiber build since 2010  Over 80% of 2015 capital expenditures were for fiber builds and carrier projects  Fiber network now spans over 8,100 route miles

 Fioptics Capital Expenditures • 2013 $ 79.5 million • 2014 $ 93.1 million • 2015 $179.5 million • 2016 $175.0million (projected)  Fioptics currently available to over 509,500 locations – approx. 64% of our territory

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Competition in the Cincinnati Market

 At least 6 competitive Ethernet providers offering wholesale service  Market pressures are forcing significant reductions in wholesale rates  TDM revenue declining as customers move to competitors and transition to Ethernet  Ethernet competition will keep DS1/DS3 pricing in check without the need for forced reductions in TDM rates  Dark fiber is also a competitive alternative and wireless providers are moving in this direction

6 One Size Does Not Fit All  Recognize that the smaller carriers are uniquely situated • CBT operates in a single market • Disproportionately impacted by the proposed reductions • No wireless or significant CLEC operations with which to offset the proposed reductions • Large purchasers have significant leverage over small carriers

 Solution • Extend forbearance to all Ethernet and packet-based services and circuit-based services delivering speeds in excess of 45 Mbps • Exclude the small carriers’ DS1/DS3 services from the additional rate reductions at this time and reexamine after 5 years

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