Exhibit 99
Verizon Wireless Update
Denny Strigl President and CEO
“Safe Harbor” Statement
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: materially adverse changes in economic and industry conditions and labor matters, including workforce levels and labor negotiations, and any resulting financial and/or operational impact, in the markets served by us or by companies in which we have substantial investments; material changes in available technology; technology substitution; an adverse change in the ratings afforded our debt securities by nationally accredited ratings organizations; the final results of federal and state regulatory proceedings concerning our provision of retail and wholesale services and judicial review of those results; the effects of competition in our markets; the timing, scope and financial impacts of our deployment of fiber-to-the-premises broadband technology; the ability of Verizon Wireless to continue to obtain sufficient spectrum resources; 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 on earnings; a significant change in the timing of, or the imposition of any government conditions to, the closing of our business combination transaction with MCI, Inc., if consummated; actual and contingent liabilities in connection with the MCI transaction; and the extent and timing of our ability to obtain revenue enhancements and cost savings following the MCI transaction.
This presentation includes certain non-GAAP financial measures as defined under SEC rules. As required by those rules we have provided a reconciliation of those measures to the most directly comparable GAAP measure in materials on our website at www.verizon.com/investor.
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Note
In connection with the proposed acquisition of MCI, Verizon filed, with the SEC on August 15, 2005, an amended proxy statement and prospectus on Form S-4 (Registration No. 333-124008), that contain important information about the proposed acquisition. These materials are not yet final and will be amended. Investors are urged to read the proxy statement and prospectus filed, and any other relevant materials filed by Verizon or MCI because they contain, or will contain, important information about Verizon, MCI and the proposed acquisition. The preliminary materials filed on August 15, 2005, the definitive versions of these materials and other relevant materials (when they become available) and any other documents filed by Verizon or MCI with the SEC, may be obtained for free at the SEC’s website at www.sec.gov . Investors may also obtain free copies of these documents at www.verizon.com/investor, or by request to Verizon Communications Inc., Investor Relations, 1095 Avenue of the Americas, 36th Floor, New York, NY 10036. Free copies of MCI’s filings are available at www.mci.com/about/investor_relations, or by request to MCI, Inc., Investor Relations, 22001 Loudoun County Parkway, Ashburn, VA 20147. Investors are urged to read the proxy statement and prospectus and the other relevant materials when such other materials become available before making any voting or investment decision with respect to the proposed acquisition.
Verizon, MCI, and their respective directors, executive officers, and other employees may be deemed to be participants in the solicitation of proxies from MCI shareowners with respect to the proposed transaction. Information about Verizon’s directors and executive officers is available in Verizon’s proxy statement for its 2005 annual meeting of shareholders, dated March 21, 2005. Information about MCI’s directors and executive officers is available in MCI’s proxy statement for its 2005 annual meeting of stockholders, dated April 20, 2005. Additional information about the interests of potential participants will be included in the registration statement and proxy statement and other materials filed with the SEC.
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Verizon Wireless Update
Performance Distribution Strategy Network Investment Product Initiatives
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Strong Performance
2Q ‘05 2Q ‘04 Y/Y
Net Adds (M) 1.9 1.5 25%
Customers (M) 47.4 40.4 17%
Churn 1.22% 1.45% (23 bps)
Service Revenue (B) $6.9 $6.0 14%
ARPU $49.42 $50.80 (3%)
Cash Exp./Customer $28.16 $27.95 1%
EBITDA (B) $3.0 $2.7 9%
EBITDA Margin 43.0% 45.0% (200 bps)
CapEx (B) $1.7 $1.4 18%
Sustained Results
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Record Growth
Retail Gross Additions (K)
1,103 2,013
2Q04
1,027 2,181
1Q05
1,154 2,318
2Q05
INDIRECT DIRECT
Retail Net Additions (K)
390 1,072
2Q04
356 1,187
1Q05
553 1,354
2Q05
INDIRECT DIRECT
Retail Churn (%)
1.72% 1.30%
2Q04
1.51% 1.20%
1Q05
1.31% 1.11%
2Q05
INDIRECT
DIRECT
Indirect gross adds up 5% YoY; direct up 15% Improving customer loyalty
Net adds: Excludes acquisitions, divestitures, and adjustments.
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Industry-Leading Growth & Loyalty - 2Q05
Total Net Adds (K)*
487
Sprint
763
Nextel
972
T-Mobile
1,071
Cingular
1,917
Verizon Wireless
Retail Wholesale/ Joint Ventures
Total Churn (%)**
2.80%
T-Mobile
2.20%
Sprint
2.20%
Cingular
1.40%
Nextel
1.22%
Verizon Wireless
VZW Customer Base (%) 47.4M
Retail Post-Paid 92.4%
Retail Prepaid 3.2%
Reseller 4.4%
* Net adds: Excludes acquisitions, divestitures, and adjustments. Sprint includes wholesale and Virgin Mobile. Nextel includes Boost Mobile.
** Churn as reported; Sprint reflects direct customers; Nextel reflects Nextel-branded.
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LNP Porting Ratio
1.9
January
2.1
February
2.2
March
2.3
April
2.3
May
2.6
June
Customers Increasingly Choosing to Move to VZW
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Direct vs. Indirect Channel
ARPU - 2005 June YTD
Direct 3% higher
Direct
Indirect
Customer Life - 2005 June YTD
Direct > 15 months longer
Direct
Indirect
Churn - 2005 June YTD
Direct > 25 bps lower
Direct
Indirect
Direct channel – higher ARPU, lower churn, longer customer life Indirect channel – higher acquisition cost
Direct Focus Yielding More Valuable Customers
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Postpaid vs. Prepaid Segment
ARPU - 2005 June YTD
Postpaid >100% higher
Retail Prepaid Retail Postpaid
Customer Life - 2005 June YTD
Postpaid > 75 months longer
Retail Prepaid Retail Postpaid
Churn - 2005 June YTD
Postpaid > 500 bps lower
Retail Prepaid Retail Postpaid
Postpaid customers – higher ARPU, lower churn, longer customer life Prepaid customers – lower acquisition cost
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Sustained Profitability Leadership
– 2Q05
EBITDA Margin
27.6% 35.2% 35.6% 41.0% 43.0%
Cingular Sprint T-Mobile Nextel Verizon Wireless
ARPU
$49.42 $50.43 $54.00 ` $62.00 $73.00
Verizon Wireless Cingular T-Mobile Sprint Nextel
Cash Expense per Customer
$42.80 $42.78 $36.52 $34.81 $28.16
Sprint Nextel Cingular T-Mobile Verizon Wireless
Leader in profitability Lowest cash expense ARPU stability
* Note: ARPU as reported. Basis for calculation differs among companies.
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Balanced Growth
Customer (M)
40.4 45.5 47.4
2Q04 1Q05 2Q05
VZW EBITDA ($B)
$2.7 $2.7 $3.0
2Q04 1Q05 2Q05
Service Revenue ($B)
$6.0 $6.6 $6.9
2Q04 1Q05 2Q05
VZW targeting balanced customer and financial growth
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Best Brand Among Consumers & Businesses
1st Place: Overall Brand Attributes
Consumer Brand Attribute Wins
27 of 27 in latest wave
Average Margin of Victory
%age pts.
15 10 5 0
Wave 1 Wave 2 Wave 3 Wave 4 Wave 5
Key Brand Perceptions
(Consumer, June, 2005)
VZW Next Best
50% 45% 40% 35% 30% 25% 20% 15%
Reliable Coverage Call Clarity Trustworthy
Business Brand Attribute Wins
Mar 2003: 7 of 20
Oct 2003: 14 of 20
Jun 2004: 22 of 24
Dec 2004: 22 of 24
Mar 2005: 25 of 26
Most Reliable Network
Brand Tracking
Gap b/t VZW and Next Best
30% 25% 20% 15% 10% 5% 0% -5% -10% -15%
4Q01 2Q02 4Q02 2Q03 4Q03 2Q04 4Q04 2Q05
Source: Taylor Nelson Sofres, 2001- 2004.
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Data Performance
VZW Data Customers (M)
12.7 17.8 19.1
2Q04 1Q05 2Q05
VZW Data ARPU ($)
$2.14 $3.11 $3.47
2Q04 1Q05 2Q05
VZW Data Revenue ($M)
$255 $416 $483
2Q04 1Q05 2Q05
Data customers up 50% YoY Data revenue up 89% YoY Data APRU accretion of 62% YoY
Significant Opportunity for Future Growth
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EV-DO Performance
Broadband Access Customers - Business
January February March April May June July
V CAST Customers - Consumer
January February March April May June July
Customer growth since end of Q1: 50%+
Double digit monthly sequential growth
Increasing availability of EV-DO capable PDAs
Customer growth since end of Q1: 400%+
Increased coverage / handset choices accelerating growth
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Verizon Wireless Update
Performance Distribution Strategy Network Investment Product Initiatives
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Distribution Plan
Continue to leverage our strong network of direct and indirect distribution
Develop new sources of direct distribution
New stores & kiosks in key locations
Pursue and implement relationships with new national retailers
Currently negotiating with a number of highly respected household names
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Stores
1,875 direct distribution points
1,300 stores & kiosks Plus 575 VZW-staffed Circuit City kiosks
Highest quality customer additions
Loyalty and lifetime value
Majority of transactions are loyalty-focused
Store Channel Gross Adds (M)
1.2 1.4 1.6
2Q03 2Q04 2Q05
Monthly Transactions by Type
Other*
Bill Payments
Upgrades
Accessories
Gross
Adds
Opportunity for Sales, Service, Upselling, Loyalty
* Other includes: Credit applications, equipment repair, and refunds
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RadioShack
Worsening relative performance across several metrics Declining source of gross adds
Only 9% of total gross adds YTD; down 8% YoY
Worst sales performance per door of national indirect - 47% below average
Poor customer profile
Churn – 29 bps higher than VZW direct postpaid
High cost channel
Bottom line: RadioShack relationship does not justify the cost
Strong Direct Combined with Strategic Indirect Channels Enable Choices That Others Don’t Have
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Strategic Retailers
Circuit City
575 VZW-staffed stores
#3 Consumer Electronics retailer VZW exclusive wireless provider
Best Buy
600+ stores through out U.S. #1 Consumer Electronics retailer Preferred carrier relationship
Costco
300+ warehouses, 43M members 6th largest retailer
Start Date
July 2004
September 2004
August 2004
Another Large Retailer…Stay Tuned
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Verizon Wireless Update
Performance Distribution Strategy Network Investment Product Initiatives
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Premier Network – Reliability
JD Power - Call Quality Index Comparison
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106 103104 102 102 102
102 99 101 98 100 100
100 98
80 90 96
VZW T-Mobile ALLTEL Sprint Cingular Nextel Industry Average
2004
2005
Widening the Lead
Source: 2005 wireless call quality performance study by J.D. Power & Associates
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Premier Network – Reliability
Footprint and Reliability
Quality and coverage for both wireless voice and data
Industry-leading Reliability & Redundancy
Routine communication: 24/7 Extraordinary events: hurricanes, wildfires, blackout Engineered for emergencies Fleet of portable generators, cell sites
Call Success Rate
100% 80% 60% 40% 20% 0%
Hurricane Ivan
VZW Carrier A Carrier B Carrier C Carrier D Carrier E
Sustaining our ‘Best Network’ Advantage
Source: VZW Drive Testing
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Broadband Leader
Cost of Service Per Megabyte
1X EV-DO
EV-DO will be 80% more cost-efficient
80%
60%
40%
20%
0%
EV-DO Coverage as a % of VZW POPs
2003 2004 2005F
Nearly 150M POP coverage by YE ‘05
Sustaining our ‘Best Network’ Advantage
Source: VZW Drive Testing
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Consistent Investment
Capital Expenditures (M)
$6,000
$4,000
$2,000
$0
2001 2002 2003 2004 2005
June YTD
EV-DO
CAPEX as a % of Service Revenue
35%
25%
15%
5%
2001 2002 2003 2004 2005
June YTD
EV-DO
Funding Growth Efficiently
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Verizon Wireless Update
Performance Distribution Strategy Network Investment Product Initiatives
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Key Product Initiatives -Consumer
V Cast Broadband 5 V CAST
Handsets Growing V CAST 3D Games, Video on Demand and Music Video Daily Pre-Pay Easy Pay Hybrid Pricing Push-to-Talk PrePay New America’s Choice
IN Pix, Flix, Txt Ringback Tones MMS Interoperability Higher Resolution Camera Phones Blue Tooth-Capable Devices New Family Share Int’l LD Value Plan 10-cent In-Flight Calling Consumer Location-Based Services V CAST Music-on-Demand
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Key Product Initiatives -Business
Broadband Access Expansion 4 Broadband AirCards VZ Access Manager Wireless Sync Workgroup & Enterprise Server Global Data –PC Cards Treo 650 Blackberry 7250
Samsung i730 Pocket PC Push-to-Talk Expansion VZ Email Expansion Corporate IM Bundled Voice, Data Packaged Fleet Mgt. Svc. Custom Solutions:
Sales Force Automation Field Force Automation Fleet Administration
Global Data Roaming
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Build on the Best Fundamentals
Premier Network
Most reliable network
Largest, fastest wireless broadband network
Customer Service Commitment
Highest customer loyalty Building long-term relationships
Distribution Strength
Effective balance of direct/ indirect locations New distribution models
Brand Reputation
Best wireless brand among consumers & businesses
Financial Strength
Sustained industry-leading growth and profitability
Sources of Differentiation
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