Profile: General Communication Inc (GNCMA.O)

General Communication, Inc. (GCI), incorporated in 1979, is a holding company and together with its direct and indirect subsidiaries, is a communications provider with operations primarily in the state of Alaska. The Company operates in five segments: Consumer, Network Access, Commercial, Managed Broadband, and Regulated Operations. It offers facilities-based local and long-distance voice services, wireless telephone services, video services, data and Internet access to residential and business customers across the state under its GCI brand. Its Consumer segment serves residential customers. Its Network Access segment serves other common carriers. Its Commercial segment serves small businesses, local, national and global businesses, governmental entities, and public and private educational institutions. Its Managed Broadband segment serves rural school districts, hospitals and health clinics. During the year ended December 31, 2011, the Company had approximately 87,900 long-distance customers, 138,100 local access lines in service, 142,600 basic video subscribers, 139,900 wireless subscribers and 119,400 cable modem subscribers.

Consumer Segment

The Company’s Consumer segment offers a range of voice, video, data and wireless services and products to residential customers. Revenues derived from Consumer segment voice services and products in 2011 totaled $52.1 million, or 8%, of its total revenues. The Company is a full-service, long-distance provider, including intrastate, interstate and international calling. The Company offers local access services in many communities and areas in Alaska, including Anchorage, Fairbanks, the Matanuska-Susitna Valley, the Kenai Peninsula, and Juneau. Its own digital local phone service (DLPS) facilities and collocated remote facilities that access the incumbent local exchange carriers (ILEC) unbundled network element (UNE) loops allows the Company to offer local service products to customers. In areas where it does not have its own DLPS facilities or access to ILEC UNE loop facilities, it offers service using total service resale of the ILEC’s local service or UNE platform.

Revenues derived from Consumer segment video services and products in 2011 totaled $118.6 million, or 17%, of its total revenues. The Company’s video systems serve 41 communities and areas in Alaska, including Anchorage, Fairbanks, the Matanuska-Susitna Valley, the Kenai Peninsula, and Juneau. The Company offers a range of video services over its broadband cable systems. The Company’s basic video service consists of digital basic service with access to between 13 and 21 channels of programming and an expanded digital basic service with access to between 40 and 102 additional channels of programming. These services generally consist of programming provided by national and local broadcast networks, national and regional cable networks, and governmental and public access programming. It transmits an entirely digital signal for all cable television channels in all markets it serves.

The Company’s high definition television (HDTV) service offers a selection of high-definition programming with access of up to 114 high-definition channels, including broadcast networks, national cable networks, channels and national sports networks. Its digital video recorder (DVR) service lets digital video subscribers select, record and store programs and play them at whatever time is convenient. DVR service also provides the ability to pause and rewind live television. The Company’s premium channel programming service, which includes cable networks, such as Home Box Office, Showtime, Starz and Cinemax, generally offers, without commercial interruption, feature motion pictures, live and taped sporting events, concerts and other special features.

The Company’s video on demand service permits its video subscribers to order and for a separate fee, individual feature motion pictures and special event programs, on an unedited, commercial-free basis. The Company’s pay-per-view service permits its video subscribers to order, for a separate fee, scheduled individual feature motion pictures and special event programs, such as professional boxing, professional wrestling and concerts, on an unedited, commercial-free basis. Revenues derived from Consumer segment data services and products in 2011 totaled $72.0 million, or 11%, of its total revenues. The Company primarily offers cable modem service. Its Internet features include e-mail virus prevention, personal Website and domain hosting, and additional e-mail accounts, are available for additional charges. Its consumer high-speed cable modem Internet service offers up to 22 megabits per second (Mbps) download and two Mbps upload speeds.

Revenues derived from Consumer segment wireless services and products in 2011 totaled $109.9 million, or 16%, of its total revenues. The Company offers facilities-based mobile wireless voice and data services to its customers. It offers its customers a variety of post-paid and prepaid wireless rate plans. The Company sells a variety of handsets and personal computer wireless data cards manufactured by various suppliers for use with its wireless services. It also sells accessories, such as carrying cases, hands-free devices, batteries, battery chargers and other items.

Network Access Segment

The Company’s Network Access segment offers wholesale voice, data, and wireless services and products to other common carrier customers. It provides network transport, billing services and access to its network to other common carriers. Revenues derived from Network Access segment voice services and products in 2011 totaled $23.6 million, or 3%, of its total revenues. The Company is engaged in the transmission of interstate and intrastate-switched message telephone service. It terminates northbound message telephone service traffic for several resellers who do not have facilities of their own in Alaska. It also provides origination of southbound calling card, toll-free services, and toll services for interexchange carriers. Services are generally provided pursuant to contracts. Revenues derived from Network Access segment data services and products in 2011 totaled $62.5 million, or 9% of its total revenues.

Data network services include multi-protocol label switching, frame relay, private line and Internet service. Revenues derived from Network Access segment wireless services and products in 2011 totaled $19.4 million, or 3%, of its total revenues. It provides roaming services on its wireless network within Alaska to other global system for mobile communications (GSM) and code division multiple access (CDMA) wireless carriers.

Commercial Segment

The Company offers a range of communications services and products to commercial and governmental customers. Its Commercial segment offers a range of voice, video, data, wireless and managed services and products to small businesses, local, national and global businesses, governmental entities, and public and private educational institutions. Revenues derived from Commercial segment voice services and products in 2011 totaled $28.7 million, or 4% of its total revenues. The Company is engaged in the transmission of interstate and intrastate-switched message telephone service between the communities in Alaska, the remaining 49 states, and foreign countries. Its message toll services include intrastate, interstate and international direct dial, toll-free services, calling card, operator and conference calling services. Small business subscribers generally may cancel long-distance service at any time.

The Company offers local access service to its Commercial segment customers using its own fiber and coax facilities and collocated remote facilities that access the ILEC’s UNE loops and wholesale facilities. Revenues derived from Commercial segment video services and products in 2011 totaled $11.6 million, or 2% of its total revenues for each year. Commercial segment subscribers, such as hospitals, hotels and motels are charged negotiated monthly service fees. Its video on demand platform is available to hotels in Anchorage that are connected using its fiber facilities. Revenues derived from Commercial segment data services and products in 2011 totaled $86 million, or 13% of its total revenues.

The Company offers several Internet service packages for commercial use. It also provides Internet access service to commercial and public organizations in Alaska. Data network services utilize voice and data transmission circuits, dedicated to particular subscribers, which link a device in one location to another in a different location. The Company designs, sells, installs, services and operates, on behalf of certain customers, communications and computer networking equipment and provide field/depot, third party, technical support, communications consulting and outsourcing services. Revenues derived from Commercial segment wireless services and products in 2011 totaled $9.8 million, or 1% of its total revenues for each year.

Managed Broadband Segment

The Company’s Managed Broadband segment offers Internet access, data network and managed services to rural schools and health organizations. SchoolAccess is a suite of services designed to advance the educational opportunities of students in underserved regions of the country. Its SchoolAccess division provides Internet and distance learning services designed exclusively for the school environment. Its network, Internet and software application services provided through its Managed Broadband segment’s Medical Services division are branded as ConnectMD. The Company offers a managed video conferencing product for use in distance learning, telemedicine and group communication and collaboration environments.

Regulated Operations Segment

The Company’s Regulated Operations segment offers wireline communications services, including local access and long-distance, and Internet services and products. It offers these services to its residential and commercial customers in 60 rural communities primarily in Southwest Alaska.

The Company competes with AT&T Alascom, Inc., Alaska Communications Systems Group, Inc. and Matanuska Telephone Association.