20121026Application.pdf

Tortai Call..
m o b ii e RECEIV
October 19, 2012 Of? OCT 26 AM, 9: 55
VIA FEDEX .J r
U liJ ;..S COMM
Jean Jewell, Commission Secretary
Idaho Public Utilities Commission
472 W Washington Street ,1
P.O.Box 83720 L - i20(
Boise, Idaho 83720-0074
Re: Application of Total Call Mobile, Inc. for Limited Designation as an Eligible
Telecommunications Carrier
Dear Sir or Madam:
Please find enclosed for filing an original and seven (7) copies of the Application of Total Call
Mobile, Inc. for Limited Designation as an Eligible Telecommunications Carrier, including
supporting Exhibits 1 through 8. Enclosed is an extra copy of the Application, which I request
that you date-stamp and return in the postage-paid, self-addressed envelope provided herein.
Should you have any questions about this submission, please do not hesitate to contact me at
[phone] or [e-mail] .
Sincerely,
o ert lap, Esq.
Chief Administrative Officer & General Counsel
Total Call Mobile, Inc.
Enclosures
Office 213,995,9700 a Fax 80,07M0963
Robert Yap
Chief Legal/Administrative Officer for Total Call Mobile, Inc.
1411 W. 190th St., Suite 700
Gardena, CA 90248
[phone] (Phone)
[phone] (Fax)
E-Mail: [e-mail]
Attorney for Total Call Mobile, Inc.
Z81 2 OCT 26 AM. 39
MMI
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
In the Matter of the Application of ) Case No.I)-
Total Call Mobile, Inc. )
for Limited Designation as an Eligible )
Telecommunications Carrier )
APPLICATION OF TOTAL CALL MOBILE, INC.
FOR LIMITED DESIGNATION AS AN
ELIGIBLE TELECOMMUNICATIONS CARRIER
Hideki Kato
Chief Operating Officer for Total Call Mobile
October 15, 2012
CERTIFICATE OF SERVICE
I hereby certify that I have this day served, in accordance with IDAPA 31.01.01 § 061
and 062, the original and seven (7) copies of the foregoing Application of Total Call Mobile, Inc.
for Limited Designation as an Eligible Telecommunications Carrier upon the Idaho Public
Utilities Commission, and one (1) copy each of the foregoing document upon the Coeur D'Alene
Tribe, the Shoshone-Bannock Tribes of the Fort Hall Indian Reservation, and the Shoshone-
Paiute Tribes of the Duck Valley Indian Reservation, addresses listed below, by mail, properly
addressed with FedEx or U.S. Postal Service postage prepaid.
Dated this 19th day of October, 2012.
Amy Inagao
Total Call Mobile, Inc.
Jean Jewell, Commission Secretary
Idaho Public Utilities Commission
472 W. Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Coeur D'Alene Tribe
850 A. Street
Plummer, ID 83851
Shoshone-Bannock Tribes of the Fort Hall Indian Reservation
Tribal Attorney's Office
Tribal Business Center
P.O. Box 306
Fort Hall, ID 83203
Shoshone-Paiute Tribes of the Duck Valley Indian Reservation
P.O. Box 219
Owyhee, NV 89832
TABLE OF CONTENTS
1. INTRODUCTION .1
II. TOTAL CALL'S UNIVERSAL SERVICE OFFERING ................................................... 2
A. Company Overview ................................................................................................. 2
B. Proposed Lifeline Plans........................................................................................... 3
C. Plan Enrollment ....................................................................................................... 5
D. Prevention of Waste, Fraud and Abuse.................................................................... 6
III. THE IDAHO PUBLIC UTILITIES COMMISSION HAS JURISDICTION TO
DESIGNATE WIRELESS ETCS....................................................................................... 6
A. The ETC Designation Request is Consistent with Recent Commission
Precedent.................................................................................................................. 7
IV. TOTAL CALL SATISFIES THE REQUIREMENTS FOR DESIGNATION AS
ANETC ............................................................................................................................... 8
A. Total Call Will Provide Service Consistent with the FCC's Grant of
Forbearance from Section 214's Facilities Requirements....................................... 9
B. Total Call Is a Common Carrier............................................................................. 10
C. Total Call Will Provide All Required Services and Functionalities...................... 10
1. Voice Grade Access to the Public Switched Telephone
Network...................................................................................................... 11
2. Minutes of Use for Local Service.............................................................. 11
3. Dual Tone Multi-Frequency Signaling or its Functional
Equivalent.................................................................................................. 11
4. Single-Party Service or its Functional Equivalent ..................................... 12
5. Access to 911 and E91 1 Services.............................................................. 12
6. Access to Operator Services ...................................................................... 12
7. Access to Interexchange Services.............................................................. 12
8. Access to Directory Assistance.................................................................. 13
9. Toll Limitation for Qualified Low-Income Customers . ............................ 13
D. Total Call Will Advertise the Availability of Supported Services ........................ 13
E. Total Call Will Comply with the Commission's Tribal Notification
Requirement........................................................................................................... 15
F. Total Call Requests Designation Throughout Its Service Area in Idaho............... 15
G. Compliance with Service Requirements................................................................ 16
H. Network Improvement Plans .17
I. Ability to Remain Functional in Emergency Situations........................................ 17
J. Commitment to Consumer Protection and Service Quality ................................... 18
K. Local Usage Requirement...................................................................................... 19
L. Equal Access Requirement .................................................................................... 20
M. Total Call is Financially and Technically Capable................................................ 20
N. Total Call Will Comply with Lifeline Certification and Verification
Requirements......................................................................................................... 21
0. Total Call Will Comply with All Regulations Imposed by the Commission........ 21
1.Request for Waiver of Certain Commission Requirements....................... 21
2.Detailed Information on Outages............................................................... 22
V. DESIGNATION OF TOTAL CALL AS AN ETC WOULD PROMOTE THE PUBLIC
INTEREST......................................................................................................................... 22
A. Advantages of Total Call's Lifeline Offering........................................................ 23
B. The Benefits of Competitive Choice...................................................................... 25
C. Impact on the Universal Service Fund................................................................... 26
VI.ANTI-DRUG ABUSE CERTIFICATION........................................................................ 26
VII.CONCLUSION .................................................................................................................. 26
RE.EjVF f.:i
BEFORE THE
IDAHO PUBIC UTILITIES COMMISSION 26 ANO 39
iDAHO PUBLiC
) UTILTU-, COMMtSSi:Oil
In the Matter of the Application of ) Docket No.
Total Call Mobile, Inc. )
for Limited Designation as an Eligible ) -
Telecommunications Carrier
APPLICATION OF TOTAL CALL MOBILE, INC.
FOR LIMITED DESIGNATION AS AN
ELIGIBLE TELECOMMUNICATIONS CARRIER
1. INTRODUCTION
Total Call Mobile, Inc. ("Total Call" or the "Company"), pursuant to Section 214(e)(2) of
the Communications Act of 1934, as amended (the "Act")', Sections 54.101 through 54.207 of
Federal Communications Commission ("FCC") Rules 2, and the Idaho Public Utilities
Commission's ("Commission") rules and regulations hereby submits this Application for
Limited Designation as an Eligible Telecommunications Carrier ("ETC") in the State of Idaho.
Total Call seeks ETC designation solely to provide Lifeline service to qualifying Idaho
consumers; it will not seek access to funds from the federal Universal Service Fund ("USF") for
the purposes of participating in the Link-Up program or providing service to high cost areas.4 As
'47 U.S.C. § 214(e)(2).
247 C.F.R. §* 54.101-54.207.
See In the Matter of the Application of WWC Holding Co., Inc. d/b/a Cellular-one Seeking Designation as an
Eligible Telecommunications Carrier that may Receive Federal Universal Service Support, Order No. 29841
(August 4, 2005) ("Commission Order No. 29841").
"Given that Total Call only seeks Lifeline support from the low-income program and neither seeks participation in
the Link-Up program nor high-cost support, ETC certification requirements for the high-cost program are not
applicable to Total Call. Moreover, as a reseller, Total Call does not own or control any networks or other facilities.
As such, Total Call has no basis for filing an investment plan, and therefore requests the Commission to waive this
requirement. Total Call is currently designated as an ETC in Maryland, Michigan, Nevada, Texas and West
Virginia, currently has applications for ETC designation pending with Arkansas, California, Hawaii, Illinois,
Louisiana, Maine, New Jersey, Ohio, Pennsylvania, and Washington, and is awaiting designation as an ETC by the
1
demonstrated herein, and as certified by Total Call's COO in Exhibit 1 to this Application, Total
Call meets all the statutory and regulatory requirements for designation as an ETC in the State of
Idaho., including the new requirements outlined in the FCC's USF/ICC Transformation Order 5
and Lifeline and Link Up Reform Order.6 Rapid grant of Total Call's request, moreover, would
advance the public interest because it would enable the Company to commence much needed
Lifeline services to low-income Idaho residents as soon as possible. Accordingly, the Company
respectfully requests that the Commission expeditiously approve this Application for ETC
designation
II. TOTAL CALL'S UNIVERSAL SERVICE OFFERING
A. Company Overview
Total Call is a Delaware Corporation.7
Its principal office is located at 1411 W. 190th
St., Suite 700, Gardena, California 90248. Total Call provides nationwide, prepaid and postpaid
wireless telecommunications services to consumers by reselling the network services of Sprint
PCS ("Sprint"). Total Call obtains from Sprint the network infrastructure and transmission
facilities to allow the Company to operate as a Mobile Virtual Network Operator ("MVNO"),
FCC in the states of Alabama, Connecticut, Delaware, District of Columbia, Florida, New Hampshire, New York,
North Carolina, Tennessee, and Virginia; no such petitions have been denied.
In the Matter of Connect America Fund, A National Broadband Plan for Our Future, Establishing Just and
Reasonable Rates for Local Exchange Carriers, High-Cost Universal Service Support, Developing a Unified
Intercarrier Compensation Regime, Federal-State Joint Board on Universal Service, Lifeline and Link-Up,
Universal Service Reform - Mobility Fund, WC Docket No. 10-90, GN Docket No. 09-51, WC Docket No. 07-135,
WC Docket No. 05-337, CC Docket No. 96-45, WC Docket No. 03-109, WT Docket No. 10-208, Report and Order
and Further Notice of Proposed Rulemaking, FCC 11-161 (rel. Nov. 18, 2011) ("USF/ICC Transformation Order').
6 In the Matter of Lifeline and Link Up Reform and Modernization, Lifeline and Link Up, Federal-State Joint Board
on Universal Service, Advancing Broadband Availability Through Digital Literacy Training, WC Docket No. 11-42,
WC Docket No. 03-109, CC Docket No. 96-45, WC Docket No. 12-23, Report and Order and Further Notice of
Proposed Rulemaking, FCC 12-11 (rel. Feb. 6, 2012) ("Lifeline and Link Up Reform Order").
Total Call was incorporated in the State of Delaware on August 11, 2005. The Company hereby reports its
corporate and trade names, along with its holding company, operating companies and affiliates as follows: Total
Call International is the parent of Total Call Mobile, Inc.; KDDI of America is the majority owner of Total Call
International; Locus Telecommunications and KDDI Global are affiliates of Total Call International.
2
similar to Cricket Communications, Inc. ("Cricket Communications"), which has been granted
ETC status by the Commission.8
Total Call's wireless services, which are affordable and easy to use, are attractive to low-
income and lower-volume consumers because they provide low-income and lower-volume
consumers with access to emergency services and a reliable means of communication that can be
used at home or while traveling to remain in touch with friends and family, as well as a means of
contacting prospective employers. Total Call offers consumers simple and affordable calling
plans, a variety of prepaid and postpaid service plans, easy-to-use handsets, and high-quality
customer service. Based on internal surveys, targeted pricing and marketing strategies, and the
demographics of other, similar Mobile Virtual Network Operators' ("MVNO") customers, Total
Call anticipates that many of its customers will be from low-income backgrounds and will not have
previously enjoyed access to wireless service because of economic constraints, poor credit history,
or sporadic employment. Total Call does not conduct credit checks or require customers to enter
into long-term service contracts as a prerequisite to obtaining prepaid wireless service or its
proposed Lifeline program service.
By providing affordable wireless plans and quality customer service to consumers who are
otherwise unable to afford them, or who were previously ignored by traditional carriers, Total Call
will expand the availability of wireless services to an increased number of consumers and in doing
so, address Congress' principal goal for the universal service program.
B. Proposed Lifeline Plans
Total Call has the ability to provide all services and functionalities supported by the
universal service program, as detailed in revised FCC Rule 54.101(a)9 throughout the State of
81n the Matter of the Application of Cricket Communications, Inc. for Designation as an Eligible
Telecommunications Carrier, Case No. CRI-T-1 1-01, Order No. 32501 (March 27, 2012) ("Cricket ETC Order").
3
Idaho. Total Call intends to be a leader in the wireless marketplace by offering exceptional value
and competitive amounts of voice usage at all price points to consumers.
Lifeline Offering. The Company's prepaid Lifeline service offering will provide
customers with the same features and functionalities enjoyed by all Total Call prepaid customers.
As demonstrated by Exhibit 2, Total Call's Lifeline service offering proposes to give eligible
customers five (5) Lifeline Plan choices'°:
1.150 Minute Plan. Under Lifeline Plan 1, eligible customers enjoy a free handset, 150
anytime minutes per month. Said minutes can be used for domestic calls or
international calling to 250 locations for no additional per minute charge. As an
option, customers may use text, inbound or outbound, which consumes 1 Plan minute.
Additional usage is priced at 10 cents per minute and 5 cents per text. Except for the
250 included international locations, there is an additional per minute charge to make
international calls.
2.250 Minute Plan. Under Lifeline Plan 2, eligible customers receive a free handset
and 250 anytime minutes per month. As an option, customers may use text, inbound
or outbound, which consumes 1 Plan minute. Additional usage is priced at 10 cents
per minute and 5 cents per text.
3.Discounted Regular Plans. Eligible customers may apply the Company's Lifeline
discount of $10.00 (i.e. which is greater than the $9.25 11 currently provided by the
FCC) to the Company's 1000 Talk & 1000 Text retail plan (regularly $29.99)
(Lifeline Plan 3), 30-day Unlimited Talk & Text retail plan (regularly $39.99)
9 See Lifeline and Link Up Reform Order at page 207, revised § 54.101(a).
'° In accordance with 47 C.F.R. § 54.202(a)(5), the Company's Lifeline terms and conditions can be found at
www.totalcallmobile.com .
See Lifeline and Link Up Reform Order at page 5.
ru
(Lifeline Plan 4), the 30-day Unlimited Talk, Text & Data retail plan (regularly
$49.99) (Lifeline Plan 5).
Total Call does not impose burdensome credit checks or long-term service contracts on
its prepaid customers. All Lifeline plans come with a free handset, free customer care calls, free
balance inquiries, and access to voice mail, caller I.D. and call waiting features at no additional
charge. Also, customers are not bound by a local calling area requirement; all Total Call plans
come with domestic long distance at no extra per minute charge and exceptional nationwide
digital coverage on the Nationwide Sprint PCS Network. Given this nationwide coverage, there
is minimal need for roaming. As an additional precaution, Total Call blocks roaming ability on
its Lifeline handsets so that customers will not incur unexpected roaming charges. Calls to 911
emergency services are always free, regardless of service activation or availability of minutes.
As demonstrated by Exhibit 2, the Company's Lifeline offerings will not only allow
feature-rich mobile connectivity for qualifying subscribers at no cost to the subscriber, but will
also give eligible customers access to a variety of rate plans that are comparable in minutes and
features to those available to post-paid wireless subscribers but at low Lifeline rates and without
the burden of credit checks or service contracts. Total Call's prepaid offering, therefore, will be
an attractive alternative for consumers who need the mobility, security, and convenience of a
wireless phone, but who are concerned about usage charges or long-term contracts.
C. Plan Enrollment
Customers interested in obtaining information on the Lifeline program will be directed to
a toll-free telephone number and to the Company's website, which will contain information
regarding Total Call's Lifeline service plans, including a detailed description of the programs
and state-specific eligibility criteria. Applicants must complete the enrollment form, which will
5
require all consumers, at sign up and annually thereafter, to provide the information and
certifications, under penalty of perjury, required by revised FCC Rule 54.410(d).'2 See Exhibit
3 for more detailed enrollment information.
D. Prevention of Waste, Fraud and Abuse
Total Call recognizes the importance of the USF. As such, the Company
has implemented the following 90-day non-usage policy in an effort to avoid waste, fraud, and
abuse of the program. Total Call will not consider a prep 'aid subscriber activated, and will not
seek reimbursement for Lifeline for that subscriber, until the subscriber activates the Company's
prepaid service through usage of the service.'3 In additioi, after service activation, Total Call
will provide a de-enrollment notice to subscribers that have not used their service for 60 days.
After 60 days of non-use, Total Call will provide notice to the subscriber that failure to use the
Lifeline service within a 30-day notice period will result in dc-enrollment.'4 For these purposes,
subscribers will be considered to "use" the service by: (1) completing an outbound call; (2)
purchasing minutes from the Company to add to the subscriber's plan; (3) answering an
incoming call from a party other than the Company; or (4) responding to a direct contact from
the Company and confirming that the subscriber wants to continue receiving the service.15 If the
subscriber does not respond to the notice, the subscriber will be dc-enrolled and Total Call will
not request further Lifeline reimbursement for the subcriber. Customers that have been
deactivated may participate in the Company's Lifeline service in the future by reapplying and re-
establishing eligibility.
III. THE IDAHO PUBLIC UTILIIES
DESIGNATE WIRELESS ETCS
12 Lifeline and Link Up Reform Order page 227-29.
13 See Lifeline and Link Up Reform Order at 1257; 47 C.F.R. § 54.
14 See Lifeline and Link Up Reform Order at 1257; 47 C.F.R. § 54.
15 See Lifeline and Link Up Reform Order at 1261; 47 C.F.R. § 54.
ON HAS JURISDICTION TO
c)(1).
The Idaho Public Utilities Commission ("Commi
authorize the limited ETC designation requested herein. 16
state public utility commissions with the "primary
Although Section 332(c)(3)(A)18 of the Act prohibits
rates charged by, any provider of commercial mobile
prohibition does not allow states to deny wireless
has the requisite jurisdiction to
214(e)(2) of the Act provides
ility" for the designation of ETCs.'7
from regulating the entry of, or the
or any private mobile service, this
ETC status.19 Therefore, the
Commission has the authority to designate Total Call as an
Pursuant to this authority, the Commission has hitorically participated in determining
whether to grant ETC status to an applying carrier, including any requesting wireless carrier.20
Under the Act, a state public utility commission with jurisdictional authority over ETC
designations must designate a common carrier as an ETC if the carrier satisfies the requirements
of Section 214(e)(1). Total Call establishes below that it currently meets all of the requirements
of Section 214(e)(1). Thus, the Commission has the authority under Section 214(e)(2) of the Act
to grant Total Call's request for designation as an ETC throughout the State of Idaho.
A. The ETC Designation Request is Consistent with Recent Commission
Precedent
Total Call's request for ETC designation to participate in the Lifeline program is
consistent with the Commission's recent designation of Cricket Communications as an ETC.2'
In its decision, the Commission determined that Cricket communications satisfied all of the
necessary eligibility requirements, and that designation of a prepaid wireless provider as an ETC
would serve the public interest. Total Call requests that the Commission expeditiously process
16 IDAHO STATUTES § 62-610D.
1747 U.S.C. § 214(e(2).
18 47 U.S.C. § 332(c)(3)(A).
19 Federal-State Joint Board on Universal Service, First Report
(199 7) ("USFOrder').
20 e.g., Cricket ETC Order.
21 See e.g. Cricket ETC Order.
Order, 12 FCC Rcd 8776, 8858-59, 1145
7
its ETC Application so that it can quickly commence iding qualifying low-income Idaho
customers with affordable USF-supported wireless
times. Designating Total Call as an ETC would
services, would offer Lifeline-eligible consumers an
they may access telecommunications services, and
of ensuring all low-income consumers have the
associated with having access to wireless services.
IV. TOTAL CALL SATISFIES THE REQ
ETC
during these challenging economic
competition for wireless Lifeline
inal choice of providers from which
a significant step towards the goal
to share in the many benefits
FOR DESIGNATION AS AN
Section 254(e) of the Act provides that "only an li eligible telecommunications carrier
designated under Section 214(e) shall be eligible to
support." Section 214(e)(2) of the Act authorizes state
designate ETC status for federal universal service
designate wireless ETCs.22 Section 21 4(e)( 1 )(A) of
54.201(d)(1), and Commission Order No. 29841 at
for ETC designation must be common carriers that will
universal service, either using their own facilities or a
resale of another carrier's services, unless granted
FCC.23 Pursuant to Section 214(e)(1)(B), FCC Rule 54
29841 at Appendix ¶A.3, applicants must also commit to
such services. 24 Additional requirements for Commission
specific federal universal service
such as the Commission, to
and authorizes the Commission to
Act, FCC Rules 54.101(b) and
¶A. 1 and 2 provide that applicants
all of the services supported by
ion of their own facilities and the
from this requirement by the
1(d)(2), and Commission Order No.
the availability and rates of
of ETCs are set forth in
22 USF Order, at 8858-59, 1145.
2347 U.S.C. § 214(e)(1), 47 C.F.R. § 54.201(b) and (d)(1), and 0
14 See 47 U.S.C. § 214(e)(1) and 47 C.F.R. § 54.201(d)(2); Order No.
No. 29841 at Appendix IA. 1 and 2..
341 at Appendix ¶A.3.
revised FCC 54.202 .25 As detailed below, Total Call satisfies each of the above-listed
requirements.
A. Total Call Will Provide Service Consistent with the FCC's Grant of
Forbearance from Section 214's Facilities Requirements
Total Call recognizes that Section 21 4(e)( 1 )(A) of the Act and FCC Rule 54.201(d)( 1)26
require ETCs to offer services, at least in part, using their own facilities, and that FCC Rule
54.201 (i)27 prohibits state commissions from designating as an ETC a telecommunications
carrier that offers services exclusively through the resale of another carrier's services. However,
the FCC granted Total Call forbearance from the facilities-based service requirement in its
Lifeline and Link Up Reform Order. 21 Section 10(e)29 of the Act provides: "[a] State commission
may not continue to apply or enforce any provision of this chapter that the [Federal
Communications] Commission has determined to forbear from applying under subsection (a) of
this section." As such, the Commission is required by Section 10(e) to act in accordance with
the FCC's grant of forbearance to Total Call, and therefore may not apply the facilities-based
requirement to Total Call.
Total Call, in its provision of wireless services, will rely on resold services which the
Company will obtain from underlying wireless carriers that currently operate their own
networks. In its Lifeline and Link Up Reform Order, the FCC granted Total Call's request for
forbearance from the facilities requirement, and stated, "the Commission will forbear from the
25 See Lifeline and Link Up Reform Order at page 208, revised § 54.202. 26 See 47 U.S.C. § 214(e)(1) and 47 C.F.R. § 54.201(d)(1).
2747 C.F.R. § 54.201(i). 28 See Lifeline and Link Up Reform Order 152 1; see also Total call Mobile, Inc. Petition for Forbearance, WC Did.
No. 09-197 (filed May 25, 2011) 29 U.S.C. § 160(e).
"own-facilities" requirement contained in Section 21 4(e)( 1 )(A) for carriers that are, or seek to
become, Lifeline-only ETCs, subject to the following conditions: 30
"(1) the carrier must comply with certain 911 requirements [(a) providing its Lifeline
subscribers with 911 and E91 1 access, regardless of activation status and availability of
minutes; (b) providing its Lifeline subscribers with E91 1 -compliant handsets and replacing,
at no additional charge to the subscriber, noncompliant handsets of Lifeline-eligible
subscribers who obtain Lifeline-supported services; and (c) complying with conditions (a)
and (b) starting on the effective date of this Order]; and
(2) the carrier must file, and the Bureau must approve, a compliance plan providing specific
information regarding the carrier's service offerings and outlining the measures the
carrier will take to implement the obligations contained in this Order as well as further
safeguards against waste, fraud and abuse the Bureau may deem necessary."
Total Call will avail itself of the FCC's grant of blanket forbearance. In accordance with
the Lifeline and Link Up Reform Order, Total Call filed its Compliance Plan, which the FCC
approved on May 25, 2012. A copy of Total Call's Compliance Plan, as approved, is attached
hereto as Exhibit 5. Total Call commits to providing Lifeline service in Idaho in accordance
with its Compliance Plan.
B.Total Call Is a Common Carrier
CMRS providers like Total Call are treated as common carriers for regulatory purposes. 31
Total Call is a common carrier as that term is defined in the Act 32 and, as such, is eligible for
designation as an ETC 33.
C.Total Call Will Provide All Required Services and Functionalities
30 See Lifeline and Link Up Reform Order at ¶11 368, 373 and 379.
Implementation of Sections 3(n) and 332 of the Communications Act, Regulatory Treatment of Mobile Services,
GN Docket No. 93-252, Second Report and Order, 9 FCC Red 1411, 1425 ¶ 37, 1454-55 1102 (1994) (wireless
resellers are included in the statutory "mobile services" category, and providers of cellular service are common
carriers and CMRS providers); 47 U.S.C. § 332(c)(1)(A) ("mobile services" providers are common carriers); see
also PCIA Petition for Forbearance for Broadband PCS, WT Docket No. 98-100, Memorandum Opinion and Order
and Notice of Proposed Rulemaking, 13 FCC Rcd 16857, 16911 ¶ 111 (1998) ("We concluded [in the Second
Report and Order] that CMRS also includes the following common carrier services: cellular service, ... all mobile
telephone services and resellers of such services.") (emphasis added). 32 See 47 U.S.C. § 153(h)(10).
This statement satisfies Order No. 29841 at Appendix ¶A. 1.
10
Through its wholesale arrangement with Sprint, Total Call offers, or will offer upon
designation as an ETC in Idaho, all of the services and functionalities required by revised FCC
Rules 54.101(a)34 and 54.202(a)35, and Order No. 29841 at Appendix ¶A.2 36, including the
following:
1.Voice Grade Access to the Public Switched Telephone Network
Total Call provides the voice grade access to the public switched telephone network
("PSTN") required by revised FCC Rule 54.101(a)37 and Commission Order No. 29841 at
Appendix ¶A.2(a)38 through the purchase of wholesale CMRS services from Sprint.
2.Minutes of Use for Local Service
As part of the voice grade access to the PSTN, an ETC is required by revised FCC Rule
54.101(a)39 and Commission Order No. 29841 at Appendix ¶A.2(b)4° to provide minutes of use
for local service at no additional charge to end-users. The FCC has determined that a carrier
satisfies the local usage requirements when it offers customers rate plans containing varying
amounts of local usage. 41 Total Call offers a variety of rate plans that provide its customers with
minutes of use for local service at no additional charge.
3.Dual Tone Multi-Frequency Signaling or its Functional Equivalent
Pursuant to Commission Order No. 29841 at Appendix ¶A.2(c)42, Total Call provides
34 See Lifeline and Link Up Reform Order at page 207, revised § 54.101(a).
See Lifeline and Link Up Reform Order at page 208, revised § 54.202(a).
36 Order No. 29841 at Appendix ¶A.2.
See Lifeline and Link Up Reform Order at page 207, revised § 54.101(a).
38 See Order No. 29841 at Appendix ¶A.2(a). 39
40See Order No. 29841 at Appendix ¶A.2(b).
" See e.g., Farmers Cellular, Inc., CC Docket No. 96-45, Memorandum Opinion and Order, 18 FCC Red 3848,
3852 ¶ 9 (2003); Pine Belt Cellular, Inc. and Pine Belt PCS, Inc., CC Docket No. 9645, Memorandum Opinion and
Order, 17 FCC Rcd 9589, 9593 110 (2002); Western Wireless Corp., Petition for Designation as an Eligible
Telecommunications Carrier in the State of Wyoming, CC Docket No. 96-45, Memorandum Opinion and Order, 16
FCC Red 48, 52 ¶ 10 (2000).
41 See Order No. 29841 at Appendix ¶A.2(c).
11
dual tone multi-frequency ("DTMF") signaling to expedite the transmission of call set up and
call detail information throughout the network. All wireless handsets offered for sale by the
Company are DTMF-capable.
4.Single-Party Service or its Functional Equivalent
"Single-party service" means that only one party will be served by a subscriber loop or
access line during a telephone transmission. Pursuant to Commission Order No. 29841 at
Appendix ¶A.2(d)43, Total Call provides single party service to its customers for the duration of
each telephone call, and does not provide multi-party (or "party-line") services.
5.Access to 911 and E911 Emergency Service
Total Call provides 911 and E911 access for all of its customers to the extent the local
government in its service area has implemented 911 or E911 systems. Total Call provides 911
and E911 access for all of its customers even when there is a zero dollar balance on a handset
consistent with the requirements of revised FCC Rule 54.101(a) and Commission Order No.
29841 at Appendix ¶A.2(e)44 . Total Call also complies with the FCC's regulations governing the
deployment and availability of E91 I compatible handsets.
6.Access to Operator Services
In accordance with Commission Order No. 29841 at Appendix ¶A.2(f)45, Total Call
offers all of its customers access to operator services, in accordance with the FCC's
requirements.
7.Access to Interexchange Service
In accordance with Commission Order No. 29841 at Appendix ¶A.2(g)46, Total Call's
See Order No. 29841 at Appendix ¶A.2(d).
See Lifeline and Link Up Reform Order at page 207, revised § 54.101(a), Order No. 29841 at Appendix ¶A.2(e).
See Order No. 29841 at Appendix ¶A.2(f).
41 See Order No. 29841 at Appendix ¶A.2(g).
12
service provides its customers with the ability to make interexchange, or long distance, telephone
calls. In fact, interexchange calls are included in the Company's standard per minute pricing
with no additional per minute charge (i.e. if you are on the Anytime Plan paying 10 cents per
minute for airtime, there is no extra per minute charge if the call is a domestic long distance call).
8.Access to Directory Assistance
In accordance with Commission Order No. 29841 at Appendix ¶A.2(h)47, All Total Call
customers are able to reach directory assistance services from their wireless handsets.
9.Toll Limitation for Qualified Low-Income Customers
FCC Rule 54.101(a) requires toll limitation services to qualifying low-income consumers.
However, in its Lifeline and Link Up Reform Order, the FCC stated that toll limitation would no
longer be deemed a supported service .48 "ETCs are not required to offer toll limitation service to
low-income consumers if the Lifeline offering provides a set amount of minutes that do not
distinguish between toll and non-toll calls.'-A9 Nonetheless, in accordance with and Commission
Order No. 29841 at Appendix ¶A.2(i)50, Total Call's offerings inherently allow Lifeline
subscribers to control their usage, as its wireless service is offered on a prepaid pay-as-you-go
basis. Total Call's services, moreover, are not offered on a distance-sensitive basis and local and
domestic long distance minutes are treated the same. Total Call will not seek reimbursement for
toll limitation service.
D. Total Call Will Advertise the Availability of Supported Services
Total Call will advertise the availability and rates for the services described above using
media of general distribution as required by Section 214(e)(1)(B) of the Act, FCC Rule
47 See Order No. 29841 at Appendix ¶A.2(h).
48 See Lifeline and Link Up Reform Order at 1367.
49 See id. at ¶ 49.
'0 See Order No. 29841 at Appendix ¶A.2(i).
13
54.201(d)(2)51 , Commission Order No. 29841 at Appendix ¶A.3 52, and in accordance with the
requirements set forth in the Lifeline and Link Up Reform Order, as outlined in the Company's
Compliance Plan. 53 The following are the planned advertising and outreach campaigns.
Depending on effectiveness and costs, Total Call Mobile will adjust these planned efforts. Total
Call will advertise its services in a manner reasonably designed to reach those likely to qualify
for Lifeline services, and will use multiple mediums for outreach, including direct mail, and the
internet. Total Call will engage in advertising campaigns specifically targeted to reach those
likely to qualify for Lifeline services, promoting the availability of cost-effective wireless
services to this neglected consumer segment. Total Call will also promote the availability of its
Lifeline offerings by distributing brochures through various state and local social service
agencies, if permitted, in order to inform customers of the availability of its Lifeline services.
In addition, Total Call intends to utilize its distribution network to help promote the
availability of its Lifeline plans, especially those with retail outlets that are frequented by low
income consumers. Total Call will provide its distribution with point of sale materials and
printed materials describing the Company's Lifeline program for use by retail outlets. 54 Total
Call expects to be able to inform consumers of the availability of Lifeline service in a manner
that will result in significantly higher participation by qualified consumers than has been the case
in the past.
Statistics suggest that there are many eligible customers who are not yet aware of the
programs. According to the best data available to the Company, as of December 31, 2010, only
between 10-20% of consumers eligible for Lifeline Services in the State of Idaho were being
See 47 C.F.R. § 54.201.
52 See Order No. 29841 at Appendix ¶A.3.
See Exhibit 5, section I.E. See also Lifeline and Link Up Reform Order at Section VII.F.
M See attached Exhibit 4 for a sample advertisement.
14
provided such services. 55
E.Total Call Will Comply with the Commission's Tribal Notification
Requirement
As required by the Commission Order No. 29841 at Appendix ¶A.5, Total Call will
provide a copy of this Application to "the affected tribal government or tribal regulatory
authority"56 of the tribal areas it intends to serve. The applicable tribal areas include those of the
Coeur D'Alene Tribe (Kootenai County), the Shoshone-Bannock Tribe of the Fort Hall Indian
Reservation (Bannock, Bingham, and Power Counties), and the Shoshone-Paiute Tribe of the
Duck Valley Indian Reservation (Owyhee County).
F.Total Call Requests Designation Throughout Its Service Area in Idaho
Total Call is not a rural telephone company as defined in Section 153(37)57 of the Act.
Accordingly, it is required to describe the geographic area(s) within which it requests designation
as an ETC .58 Total Call requests designation as an ETC throughout its entire service area in
Idaho, which is wherever its underlying carrier, Sprint, has coverage.59 Total Call, through its
resale of wireless services provided by its underlying carrier in Idaho, can provide service in
every Zip Code in the State of Idaho. Accordingly, Total Call seeks ETC status throughout the
entire State of Idaho.
Total Call understands that its service area overlaps with many rural carriers in Idaho, but
maintains that the public interest factors described below justify its designation in these carriers'
See attached Exhibit 6, 2010 Lifeline Participation Rates by State, which was obtained from the Universal Service
Administrative Company ("USAC"), an independent non-for-profit corporation designated as the administrator of
the federal Universal Service Fund by the FCC. USAC administers Universal Service Fund (USF) programs for
high cost companies serving rural areas, low-income consumers, rural health care providers, and schools and
libraries.
56 See Order No. 29841 at Appendix ¶A.5. " 47 U.S.C. § 153(37).
58 Public Notice - Procedures for FCC Designation of Eligible Telecommunications Carriers Pursuant to Section
214(e)(6) of the Communications Act, FCC 97-419, 12 FCC Rcd 22947 (1997).
See Exhibit 7 for a list of wire centers included in the Company's coverage area in Idaho.
15
service areas, especially because it seeks ETC designation solely to utilize USF funding to
provide Lifeline service to qualified low-income consumers. It does not seek and will not accept
high cost support. Nor does Total Call seek to provide Link-Up service. Therefore, its
designation as an ETC will cause no growth in the high cost portions of the USF and will not
erode high cost support from any rural telephone company. In fact, the FCC has determined that
"[d]esignation of competitive ETCs promotes competition and benefits consumers in rural and
high-cost areas by increasing customer choice, innovative services, and new technologies."60 As
an option, the Commission may designate Total Call as an ETC in non-rural areas that Total Call
serves without redefining the service areas of non-rural telephone companies. However, the
Commission may also designate Total Call as an ETC in rural telephone company service areas
upon a finding that such designation would serve the public interest. 61
G. Compliance with Service Requirements
Revised FCC Rule 54.202(a)( 1 )(i) requires an applicant to certify that it will comply with
the service requirements applicable to the support that it receives. 62 Total Call provides service
in Idaho by reselling service that it obtains from its underlying carrier. The carrier's network is
operational and largely built out. Thus, Total Call will be able to commence offering its Lifeline
service to all locations served by its underlying carrier very soon after receiving approval from
the Commission. Total Call commits to comply with the FCC's service requirements applicable
to the support that it receives. 63
Total Call also commits to comply with the Commission's service requirements
60 See Western Wireless Corporation Petition for Designation as an Eligible Telecommunications Carrier in the
State of Wyoming, Memorandum Opinion and Order, 16 FCC Rcd 48, 55 (2000).
61 See 47 C.F.R. § 54.207(c).
62 Lifeline and Link Up Reform Order at page 207, revised § 54.202(a).
63 See Lifeline and Link Up Reform Order page 208, revised § 54.202(a)( 1 )(i).
16
applicable to the support that it receives. 64 Subject to handset availability, Total Call commits to
provide the supported services on a timely basis to requesting customers within its designated
service area pursuant to FCC Rule 54.207(a(1)(i)(A)65. However, given that Total Call is a
reseller, it does not own or control the networks of its underlying carriers. As such, FCC Rule
54.207(a)(1)(i)(A)66 is not applicable because Total Call does not have the ability to make
modifications or additions to the underlying carriers' networks to serve customers that are
outside of its underlying carrier's network coverage.
H.Network Improvement Plans
Although revised FCC Rule 54.202(a)(1)(ii) and Commission Order No. 29841 at
Appendix ¶B. 1 require a common carrier seeking ETC designation to submit an improvement
plan (a five-year plan under the FCC Rules, and a two-year plan under the Commission's Order)
as part of its application67, the FCC has stated that a common carrier seeking designation as a
Lifeline-only ETC is not required to submit such a plan as part of its application for designation
as an ETC .68
I.Ability to Remain Functional in Emergency Situations
Revised FCC Rule 54.202(a)(2) and Commission Order No. 29841 at Appendix ¶B.2
request information that demonstrates that Total Call has the ability to remain functional in
emergency situations, has a reasonable amount of back-up power and is able to reroute traffic
spikes caused by emergency situations .69 Given that Total Call is a reseller, it neither owns nor
64 See e.g., Commission Order No. 29841 at Appendix 1P.1 (citing 47 C.F.R. § 54.202 as it stood prior to the
February 6, 2012 Lifeline and Link Up Reform Order).
65 See 47 C.F.R. § 54.202(a)(1)(i)(A); Commission Order No. 29841 at Appendix 1B.1(a).
6647 C.F.R. § 54.202(a)(1)(i)(B); Commission Order No. 29841 at Appendix 1B.1(b).
67 See Lifeline and Link Up Reform Order page 208, revised § 54.202(a)(1)(ii); Commission Order No. 29841 at
Appendix TB. 1. 68 See Lifeline and Link Up Reform Order at 1386. 69 See Lifeline and Link Up Reform Order page 209, revised § 54.202(a)(2), and Commission Order No. 29841 at
Appendix ¶B.2.
17
operates any cell site, microwave hubs, or switches. Therefore, the requirements in revised FCC
Rule 54.202(a)(2) that Total Call demonstrate that it has a reasonable amount of back-up power
and is able to reroute and manage traffic in emergency situations is not applicable. Total Call
provides service in Idaho by reselling services of its underlying wireless network carrier.
Through its agreement with its underlying carrier, Total Call will provide its customers with the
same ability to remain functional in emergency situations as is currently provided by the ILECs
to their own customers.
J. Commitment to Consumer Protection and Service Quality
An ETC applicant must demonstrate that it will satisfy applicable consumer protection
and service quality standards in accordance with revised FCC Rule 54.202(a)(3) and
Commission Order No. 29841 at Appendix ¶B.3.7° Specifically, Total Call commits to comply
with the Cellular Telecommunications and Internet Association's (CTIA) Consumer Code for
Wireless Service, and also commits to exceptional customer service standards. Customers will
experience the level of service, including wait times typical of post-paid customer service, which
is generally superior to prepaid service. Customers will also be able to contact Customer Care
via the Company's toll free number or by mail. In addition, there are a number of automated
systems and web options for customer needs. Customers may call Total Call or visit the
Company's website for additional information or to buy additional airtime, should they wish to
do so. Total Call is committed to resolving customer questions, concerns and complaints in a
swift and satisfactory manner. Total Call will designate a contact person to work with the
Commission regarding complaint resolution. Once Total Call is made aware of consumer
complaints/inquiries, a trained customer care supervisor or manager will respond within 48
70 See Lifeline and Link Up Reform Order page 209, revised § 54.202(3), and Commission Order No. 29841 at
Appendix ¶B.3.
IE
hours. Where a phone number is associated with the complaint, the customer will be contacted
by telephone (minutes will not count against the customer). Otherwise, Total Call will use e-
mail or regular mail, depending on the customer's preference or the information available to
Total Call.
K. Local Usage Requirement
FCC rules no longer require an applicant for ETC designation to demonstrate that it
offers a local usage plan that is "comparable" to the plan offered by the ILEC in the relevant
service territory 71 ; however, Commission Order No. 29841 at Appendix ¶B.4 requires
information that an applicant for ETC designation offers a local usage plan that is comparable to
the one offered by the ILEC in the services areas for which designation as an ETC is sought 72.
Similar to ILEC Lifeline offerings, Total Call customers will have the option to apply the
Lifeline discount to the Company's retail rate plans and will have the option for unlimited local
calling (i.e. if the customer signs up for Lifeline Plan 4 (unlimited talk and text) or Lifeline Plan
5 (unlimited talk, text, and data). Not only will Total Call's offering be comparable to the
underlying ILEC plans, but it also will exceed them in several respects. For Lifeline Plans 1 and
2, Total Call will offer Lifeline customers a certain amount of service free of charge. In contrast
to the ILEC plans, which contain relatively small local calling areas, Total Call customers can
use these free minutes to place calls statewide (or even nationwide) because Total Call does not
constrict customers' use by imposing a local calling area requirement. Total Call will also
provide Lifeline customers with E911 capabilities at no cost as well as voice mail, caller I.D.,
and call waiting features at no cost. The very nature of the wireless phone, i.e. mobility, has a
' See Lifeline and Link Up Reform Order at page 208, revised § 54.202(a).
72 See Commission Order No. 29841 at Appendix 1B.4.
19
tremendous benefit to many consumers, a benefit to which a monetary value cannot be easily
assigned.
L.Equal Access Requirement
While Total Call is no longer required to acknowledge that it may be required to provide
equal access to long distance carriers in the event that no other ETC is providing equal access
within the service area under revised FCC Rule 54.202(a)73, Total Call acknowledges that it may
be required to provide equal access to long distance carriers within its designated service area,
and will abide by such a requirement.
M.Total Call is Financially and Technically Capable
In accordance with revised FCC Rule 54.202(a)(4)74 Total Call is financially and
technically capable of providing Lifeline-supported services. 75 Total Call has been in business
for 6 years and provides services to both Lifeline and non-Lifeline customers. Total Call already
successfully provides wireless services in 49 states. Total Call has not been subject to
enforcement action or ETC revocation proceedings in any state. Total Call does not, and has no
intent to, offer exclusively Lifeline-supported services—and is therefore not exclusively
dependent on universal service funds for its revenue. Total Call also has the financial support of
its parent company, KDDI of America, which is a subsidiary of KDDI of Japan, the second
largest carrier in Japan. Furthermore, the senior management of Total Call has great depth of
knowledge in the telecommunications industry and offers extensive telecommunications
business, technical and managerial expertise to the Company.76 Also, since Total Call will be
73 See Lifeline and Link Up Reform Order at page 208, revised § 54.202(a).
74 See Lifeline and Link Up Reform Order page 209, revised § 54.202(4).
See Lifeline and Link Up Reform Order at 1387.
76 See Exhibit 8 for key management resumes.
20
providing resold wireless service, it will rely upon the managerial and technical expertise of its
underlying carrier (i.e. Sprint).
N. Total Call Will Comply with Lifeline Certification and Verification
Requirements
Revised FCC Rule 54.410 and 54.416 requires ETCs to certify and verify a Lifeline
customer's initial and continued eligibility. 77 Total Call will certify and verify consumer
eligibility in accordance with the FCC's requirements, including the new rules set forth in the
Lifeline and Link Up Reform Order, and with Commission Order No. 29841 at Appendix ¶D 78
0. Total Call Will Comply with All Regulations Imposed by the Commission
By this Application, Total Call hereby asserts its willingness and ability to comply with
all the rules and regulations that the Commission may lawfully impose upon the Company's
provision of service contemplated by this Application, to the extent such provisions apply to a
prepaid wireless provider. Total Call commits to comply with the reporting requirements adopted
by the Commission 79.
1. Request for Waiver of Certain Commission Requirements
As Total Call is not seeking high-cost support for its wireless service, it hereby requests a
waiver of the following Commission Rules: Commission Order No. 29841 at 1B.1. (two-year
network improvement and maintenance plan based on high-cost support) and Commission Order
No. 29841 at ¶C.1 (annual report of certain information based on high-cost support). Total Call
understands that these rules relate solely to the receipt an expenditure of high-cost funds.
Because Total Call will not apply for or accept federal high-cost funding, it believes these rules
are not applicable to Total Call's application and, therefore, should be waived.
77 See Lifeline and Link Up Reform Order page 224, revised § 54.410 and 54.416.
78 See Commission Order No. 29841 at Appendix ¶D.
79 See Commission Order No. 29841 at Appendix ¶C.
21
2. Detailed Information on Outages
Commission Order No. 29841 at ¶C.2 requires "detailed information on any outage, as
that term is defined in 47 C.F.R. § 4.5, of at least thirty (30) minutes in duration for each service
area in which an ETC is designated for any facilities it owns, operates, leases, or otherwise
utilizes that potentially affects (a) at least ten percent of the end users in a service area; or (b) a
911 special facility, as defined in 47 C.F.R. § 4.5(e)."8° Total Call provides service in Idaho by
reselling services of its underlying wireless network carrier. Given that Total Call is a reseller
that neither owns, leases, nor operates any facilities, Total Call must ask its underlying carrier for
information regarding any such outages. Thus, Total Call will only be able report details of
outages to the extent they are provided by its underlying carrier.
V. DESIGNATION OF TOTAL CALL AS AN ETC WOULD PROMOTE THE
PUBLIC INTEREST
Under Commission Order No. 29841 at ¶A.4, ETC applicants must demonstrate that
designation is "consistent with the public interest, convenience, and necessity." In the case of
non-rural areas, the applicant must demonstrate that "the public interest will be met by an
additional designation" in rural areas. 81 One of the principal goals of the Act, as amended by the
Telecommunications Act of 1996, is "to secure lower prices and higher quality services for
American telecommunications consumers and encourage the rapid deployment of new
telecommunications technologies" to all citizens, regardless of geographic location or income. 82
There is no question that designating Total Call as an ETC in Idaho will further the public
interest by providing Idaho consumers, especially low-income consumers, with lower prices and
higher quality services. Many low-income customers in Idaho have yet to reap the full benefits
80 Commission Order No. 29841 at Appendix ¶C.2.
81 See Commission Order No. 29841 at Appendix ¶A.4.
82 Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56.
of the intensely competitive wireless market. Whether it is due to financial constraints, poor
credit history or intermittent employment, these consumers often lack the countless choices
available to most consumers.
The instant request for ETC designation must be examined in light of the Act's goal of
providing low-income consumers with access to telecommunications services. The primary
purpose of universal service is to ensure that consumers—particularly low-income consumers—
receive affordable and comparable telecommunications services. Given this context, designating
Total Call as an ETC would significantly benefit low-income consumers eligible for Lifeline
services in the State of Idaho—the intended beneficiaries of universal service.
A. Advantages of Total Call's Lifeline Offering
The public interest benefits of Total Call's wireless service include larger local calling
areas (as compared to traditional wireline carriers), the convenience and security afforded by
mobile telephone service, the opportunity for customers to control cost by receiving a preset
amount of monthly airtime at no charge, the ability to purchase additional usage at flexible and
affordable amounts in the event that included usage has been exhausted, 911 service even if a
handset has a zero balance) and, where available, E911 service in accordance with current FCC
requirements. Total Call's Lifeline customers will receive the same high-quality wireless
services and exceptional customer service provided to all Company customers. Total Call's
Lifeline rate plans will not only allow feature-rich mobile connectivity for qualifying subscribers
at no cost to the subscriber, but also will bring a variety of rate plans into the reach of Lifeline
customers that are comparable in minutes and features to those available to post-paid wireless
subscribers - but at low Lifeline rates and without the burden of credit checks or contracts.
23
Total Call offers customers five choices to better meet their needs: (1) a 150-minute plan,
which includes international calling to over 250 locations for no additional per minute charge;
(2) a 250-minute plan (domestic minutes only); (3) a 1000 Talk & 1000 Text retail plan for
$19.99 (regularly $29.99); (4) a 30-day Unlimited Talk & Text retail plan for $29.99 (regularly
$39.99); and (5) a 30-day Unlimited Talk, Text, & Data retail plan for $39.99 (regularly $49.99).
All Lifeline plans include a free phone, call waiting, caller ID and voicemail free of charge.
Total Call does not charge an activation fee or any other charge to establish service (other
Lifeline service providers often charge an activation charge of $30.00). Minutes include
nationwide coverage, so customers do not incur long distance charges, unlike local calling area
offerings which prevent or charge extra for calls made outside of a defined area. Unlike many
Lifeline competitor products, Total Call provides customer service calls free of charge (that is,
these calls do NOT reduce a customer's minute allotment).
Total Call's Lifeline service will provide low-income Idaho residents with the convenience
and security offered by wireless services - even if their financial position deteriorates. Total
Call's prepaid wireless plans enable consumers to enjoy the benefits of wireless
telecommunication without being subject to extensive credit reviews and long-term service
commitments, which historically have limited the availability of wireless service to many
Americans, including many Idaho residents. ETC designation in Idaho would enable Total Call to
offer appealing and affordable service offerings to low-income Idaho customers to ensure that they
are able to afford wireless services on a consistent and uninterrupted basis.
It is a commonly accepted fact that in today's market all consumers, including qualified
Lifeline customers, view the portability and convenience of wireless service not as a luxury, but
as a necessity. Mobile service allows children to reach their parents, wherever they may be,
24
allows a person seeking employment the ability to be contacted by potential employers, and
provides end users with the ability to contact emergency service providers, regardless of
location. Providing Total Call with the authority necessary to offer discounted Lifeline services
to those in most danger of losing wireless service undoubtedly promotes the public interest.
Moreover, grant of Total Call's Application will serve the public interest in increasing the
number of ETCs in Idaho. By granting ETC status to Total Call, the Commission will enable Total
Call to increase the number of Idaho residents receiving Lifeline support, thereby increasing the
amount of USF money flowing into Idaho. In sum, ETC designation in the State of Idaho would
enable Total Call to provide all of the public benefits cited by the FCC in its analysis in the Virgin
Mobile Order. Namely, Total Call would provide "increased consumer choice, high-quality
service offerings, and mobility,"83 as well as the safety and security of effective 911 and E911
services.84
B. The Benefits of Competitive Choice
The benefits to consumers of being able to choose from among a variety of
telecommunications service providers have been acknowledged by the FCC for more than three
decades.85. Designation of Total Call as an ETC will promote competition and innovation, and
spur other carriers to target low-income consumers with service offerings tailored to their needs
and to improve their existing networks to remain competitive, resulting in improved services to
consumers. Designation of Total Call as an ETC will help assure that quality services are
available at "just, reasonable, and affordable rates" as envisioned in the Act. 86 Introducing Total
Call into the market as an additional wireless ETC provider will afford low income Idaho
83 See Virgin Mobile Order, 24 FCC Rcd at 3395 138.
84 See Id. at 3391 ¶23.
85 See, e.g., Specialized Common Carrier Services, 29 FCC Red 870 (1971).
86 See 47 U.S.C. § 254(b)(1).
25
residents a wider choice of providers and available services while enhancing the competitive
marketplace as ETCs compete for a finite number of Lifeline-eligible customers. Increasing the
competitive marketplace of providers has the potential to effectively increase the penetration rate
and reduce the number of individuals not connected to the PSTN.
C. Impact on the Universal Service Fund
Total Call's request for designation as an ETC solely for Lifeline purposes would not
unduly burden the USF or otherwise reduce the amount of funding available to other ETCs.
With Lifeline, ETCs only receive support for customers they obtain. The amount of support
available to an eligible subscriber is exactly the same whether the support is given through a
company such as Total Call or the ILEC operating in the same service area. Total Call will only
increase the amount of USF Lifeline funding in situations where it obtains Lifeline customers not
enrolled in another ETC's Lifeline program. By implementing the safeguards set forth in the
Lifeline and Link Up Reform Order, Total Call will minimize the likelihood that its customers
are not eligible or are receiving duplicative support either individually or within their household.
Significantly, the Company's designation as an ETC will not increase the number of persons
eligible for Lifeline support. Total Call's ability to increase the Lifeline participation rate of
qualified low-income individuals will further the goal of Congress to provide all individuals with
affordable access to telecommunications service, and thus any incremental increases in Lifeline
expenditures are far outweighed by the significant public interest benefits of expanding the
availability of affordable wireless services to low-income consumers.
VI.ANTI-DRUG ABUSE CERTIFICATION
Total Call certifies that no party to this Application is subject to denial of federal benefits,
including FCC benefits, pursuant to Section 5301 of the Anti-Drug Abuse Act of 1988.
VII.CONCLUSION
Based on the foregoing, designation of Total Call as an ETC in the State of Idaho accords
with the requirements of Section 214(e)(2) of the Act and is in the public interest.
WHEREFORE, Total Call respectfully requests that the Commission promptly designate
Total Call as an ETC in the State of Idaho solely for purposes of participating in the Lifeline
program.
Respectfully submitted,
-
Hideki Kato
Chief Operating Officer of Total Call Mobile, Inc.
1411W. 190' St., Suite 700
Gardena, CA 90248
[phone] (Phone)
October 15, 2012
27
TABLE OF EXHIBITS
EXHIBIT 1 Certification of Hideki Kato, COO of Total Call Mobile, Inc.
EXHIBIT 2 Proposed Lifeline Offering
EXHIBIT 3 Copy of the Lifeline Customer Program Enrollment Form
EXHIBIT 4 Copy of Proposed Advertising Language and Brochure to Advertise Lifeline
EXHIBIT 5 FCC-Approved Compliance Plan
EXHIBIT 6 2010 Lifeline Participation Rates by State
EXHIBIT 7 Wire Center List
EXHIBIT 8 Key Management Resumes
EXHIBIT 1
Certification of Hideki Kato, COO of Total Call Mobile, Inc.
State of California
County of Los Angeles
Certification
Personally appeared before the undersigned, an officer duly authorized to administer oaths,
Hideki Kato, who first being duly sworn, deposes and states that he is the COO of Total Call
Mobile, Inc., Applicant in this application, and has read the same and knows the contents thereof,
and confirms that the statements made herein are true to the best of his knowledge and belief.
Dated:/ o/, T/ 2-012
J771
Hideki Kato, COO
Subscribed and sworn to before me this f day of6"c. L 1.t r 2012.
(Notary Seal)
~Signatu re of person authorized to administer oath)
My Commission Expires: (2
,
NATN*I*L LAW
connss# 1SO2I5
Not.ry Public - California
Los Angslss County
My Comm. Expkn Jun 27. 2016
EXHIBIT 2
Proposed Lifeline Offering
Proposed Lifeline Offering
Service Offering
TCM's Lifeline offering proposes to give eligible customers the following Lifeline Plan choices:
Option 1: Lifeline 150 Minute Plan
150 anytime minutes per month (as an option, customer may use text, inbound or outbound,
which consumes 1 plan minute)
(additional usage priced at 10 cents per minute and 5 cents per text message)
Net cost to Lifeline customer: $0 (free)
*This package includes:
• Free basic handset (customer may pay for upgrade)
• Free Voicemail and Caller-ID features
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
• For the plan minutes, no additional charge for international calling to the 250 locations
listed on Exhibit D (i.e. only the standard per minute rate applies)
• International calls to other destinations require additional funds based on call destination
Option 2: Lifeline 250 Minute Plan*
250 anytime minutes per month (as an option, customer may use text, inbound or outbound,
which consumes 1 plan minute)
(additional usage priced at 10 cents per minute and 5 cents per text message)
Net cost to Lifeline customer: $0 (free)
*This package includes:
• Free basic handset (customer may pay for upgrade)
• Free Voicemail and Caller-ID features
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
• International calls require additional funds based on call destination. For the destinations
on the 150 minute plan that are no additional charge, customers on this plan will be
charged an additional $.02 per minute.
Option 3: Lifeline Credit - Discount Plan (30-Day Pl ans)*
Lifeline eligible customers may choose the 30-day Unlimited Talk & Text plan; the 30-day
Unlimited Talk, Text & Data; or the 30-day 1000 talk & 1000 text plan at a $10 discount off
of retail. Additional details regarding TCM's plans can be found at
www.totalcallmobile.com/rateplans monthly.aspx. The pricing for Lifeline eligible
customers are as follows:
1000 Talk & 1000 Text for 30 days at $19.99 (retail price is $29.99)
Unlimited Talk & Text for 30 days at $29.99 (retail price is $39.99)
Unlimited Talk, Text & Data for 30 days at $39.99 (retail price is $49.99)
*Thi s package includes:
• Free basic handset (customer may pay for upgrade)
• Free Voicemail and Caller-ID features
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
• International calls require additional funds based on call destination. For the destinations
on the 150 minute plan that are no additional charge, customers on these plans will be
charged an additional $.02 per minute.
Free International Location Promo
Free International Calling Destinations on the Lifeline 150 Minute Plan (Certain special
or off-network locations may be excluded from the Free International Calling Destinations):
• Termination to landline phones only, termination to mobile phones and off network
locations excluded (unless otherwise noted).
• Locations are subject to change from time to time. Please visit
www.totalcallmobile.com for an updated list.
• Calls to certain cities in these countries are part of the Free International Location
Promo.
Calls to the following cities in Mexico are part of the Free International Location Promo.
Mexico City List
Guadalajara Ciudad Acuna Guamuchil
Ciudad de Mexico Ciudad Altamirano Guanajuato
Monterrey Ciudad Camargo B Guasave
Acaponeta Ciudad Constitucion Guaymas
Acapulco Ciudad Cuauhtemoc Guerrero Negro/Santa Rosa
Actopan Ciudad del Carmen Hermosillo
Agua Prieta Ciudad Delicias Heroica Ciudad de Ures
Aguascalientes Ciudad Guzman Hidalgo
Allende Ciudad Hidalgo Huatabampo
Apatzingan Ciudad Juarez Huetamo
Apizaco Ciudad Lazaro Cardenas Huimanguiillo
Arcelia Ciudad Mante Huitzuco
Atlacomulco Ciudad Obregon Iguala
Atliaca/Tixtia Ciudad Sahagun Irapuato
Atlixco Ciudad Valles Ixtapan de la Sal
Autlan Ciudad Victoria Ixtian del Rio
Bahia de Huatulco Coatzacoalcos Izucar de Matamoros
Cabo San Lucas Colima Jalapa
Caborca Cordoba Jalpa
Cadereyta Jimenez Cosamaloapan Jerez de Garcia Salinas
Campeche Cozumel Jojutla
Cananea Cuautla Juchitan
Cancun Cuernavaca La Barca
Celaya Culiacan La Paz
Cerralvo Durnago La Piedad
Cheumal Encarnacion de Diaz Lago de Moreno
Chihuahua Ensenada Leon
Chilapa Estación Manuel Lerdo de Tejada
Chilpancingo Fresnfflo Lerma
Cintalapa de Figueroa General Tapia Linares
Los Mochis Puerto Vallarta Tenancingo
Los Reyes Puruandiro Tenango del Aire/Tialmanalco
Magdelena Queretaro Tepatitlan
Manuel Quimichis/Tecuala Tepic
Manuel Ojmaga Reynosa Tequila
Manzanillo Rio Grande Texcoco
Martinez de la Torre Rio Verde Teziutlan
Matamoros Sabinas Ticul
Matehuala Sahuayo Tijuana
Mazatlan Salamanca Tizayuca
Merida Saltfflo Tizimin
Mexicali Salvatierra Tiapa de Comonfort/Alcozauca de Gro.
Minatitlan San Andres Tuxtla Tlaxcala
Monclova San Cristobal de las Casas Toluca
Moelia San Fernando Torreon
Moroleon San Jose de Gracia Tula
Nacozari de Garcia San Jual del Rio Tulancingo
Navojoa San Luis de La Paz Tuxpan
Nogales San Luis Potosi Tuxtepec
Nuevo Casas Grandes San Luis Rio Colorado Tuxtla Guttierez
Nuevo Laredo San Martin Pachivia/Teloloapa Uruapan
Oaxaca de Juarez San Miguel de Allende Valle de Bravo
Ocotlan San Quintin Veracruz
Ometepec Santa Ana Villa Flores
Orizaba Santa Rosalia de Camargo Villahermosa
Pachuca Santiago Ixcuintla Yurecuaro
Palenque Santiago Papasquiaro Zacapu
Parral Santiago Tianguistenco Zacatecas
Parras de la Fuente Silao Zamora
Patzcuaro Tala Zthuatanejo
Penjamo Tampico Zinapecuaro
Petatlan Tapachula Zitacuaro
Piedras Negras Taxco Zumpango
Playas de Rosarito Tecate
Poza Rica de Hgo Tecoman
Puebla Tecpan de Galeana
Puerto Penasco Tehuacan
EXHIBIT 3
Copy of the Lifeline Customer Program Enrollment Form
111 G
Apply for a Free Mobile
Phone & Free Service
Through the government-supported Lifeline program, you may qualify for free service. See inside for
details. This is a State of Idaho Enrollment Form. For other state forms or questions, please call
1-800-661-7391 or go to www.totalcallmobile.com/lifeline.
LIFELINE PROGRAM FOR THE STATE OF IDAHO
WHAT IS THE LIFELINE PROGRAM?
Lifeline is a government-supported program that provides free mobile phone services to qualified low-income customers. If you qualify, you will
receive a free mobile phone, a limited amount of free wireless service, and unlimited access to 911 and customer service. For more information or
assistance, call 1-800-661-7391.
HOW DO I QUALIFY FOR THE LIFELINE PROGRAM?
You qualify for Total Call Mobile Lifeline Plans in the State of Idaho if you are enrolled in certain government programs or if your household income
is below 135% of the poverty line. See attached form for qualifying programs and income levels.
WHAT PLANS CAN I SIGN UP FOR IF I QUALIFY FOR THE LIFELINE PROGRAM?
If you qualify for the Lifeline program, you may choose from any of the Lifeline Plans below. Lifeline Plans 1 & 2 are available at no cost to you unless
you purchase additional minutes or text messages. Alternatively, you may also choose certain Total Call Mobile prepaid plans at discounted rates
under Lifeline Plans 3, 4 & 5. All of Total Call Mobile's Lifeline Plans include:
- A free phone (selected by Total Call Mobile). Call customer service for upgrade options.
- Free customer service calls.
- Free 911 and balance inquiry calls.
- Free voicemail, Caller ID, and Call Waiting.
- For additional minutes, text messages, or international calls, load a regular "Anytime Plan" refill or call customer service.
Minutes Additional Text Messages Additional Data Included Additional
Included
150 (Domestic
Minutes Included
-
Text Messages Data
Plan 1
(150 minutes per & Select Interna- $0.10/ mm. 1 P1 0 a minute $0.05 /text 0 Unavailable
month for free) tional)
Plan
(250 minutes per 250 (Domestic) $0.10 I mm. 1 Plan minute $0.05/text 0 Unavailable
month for free)
Plan 3
(Discounted 1000 1000
Talk & 1000 Text (Domestic) $0.10! mm. i000 $0.05 / text 0 Unavailable
for $19.99)
Plan 4
(Discounted
Unlimited Talk & Unlimited NA Unlimited NA 0 Unavailable
Text for $29.99 (Domestic)
per month)
Plan 5
(Discounted
Unlimited Talk, Unlimited NA Unlimited NA Unlimited NA
Text & Data for (Domestic)
$39.99 per
month)
SERVICE TERMS & CONDITIONS
Comprehensive terms and conditions are available at www.totalcallmobile.com . Total Call Mobile ("1CM") service is for personal use within the
United States. "Unlimited" does not mean unreasonable use. Unreasonable use includes, but is not limited to, conference calling, monitoring
services, abnormally large data transmissions, broadcast, telemarketing, autodialed calls, commercial uses, an abnormally high number of
calls/messages or abnormally long calls, tethering to another device for data transmission, or any other usage that interferes with TCM
service/network resources. Data is only available with select handsets. TCM data plans may not be used with smart phones/PDA devices unless
the plan is explicitly identified for such devices. International calls are charged at the applicable rate plus airtime. "Free International Locations" do
not apply to calls made to foreign mobile phones or to off network/special locations. The "Free International Locations" promotion only applies when
using the Anytime Plan (i.e. 100 per minute) or Lifeline Plan I (i.e. 150 minutes per month). TCM reserves the right to limit picture message size.
Governmental taxes and fees will be charged where applicable. Plans, rates and fees are subject to change without notice. The rates herein are
valid as of August 1, 2012. TCM reserves all rights with regard to TCM intellectual property.
City:
First Name:
Home Address:
(P.O. Box NOT su
Home Address: 0 Permanent 0 Temporary
Billing Address, if different from
(P.O. Box ja sufficient)
Last 4 Digits of SSN:
Phone Number:
J{.Ie]t!;,Jtp [cjl:1IJI'4
Last Name:
City: State: Zip Code:
Date of Birth (MM/DDIYYYY):
State: Zip Code:
Public Aid Case Number (if applicable):
E-mail:
Tw tai Call
Channel ID:
Applicable)
mmmomobile
LIFELINE PROGRAM FOR THE STATE OF IDAHO
To apply for Lifeline service through Total Call Mobile, please complete this form and submit it to the address at the bottom of the next page. For
more information or assistance, call 1-800-661-7391. When you submit this application, ULiJL,_..__:r
*IdJ$1OSupporting documentation will not be returned
To qualify for Lifeline, you must complete giLhff this Section or Section #3 below. Check all program(s) that the person in Section #1 is enrolled
in If you qualify for Lifeline under this Section (i.e. by being enrolled in at least one of the following programs),
If any member of your household is a National School Lunch participant you can
check the box for that program.
o Federal Public Housing I Section 8 0 SNAP (formerly known as Federal Food Stamp program)
El Low Income Home Energy Assistance (LIHEAP)
0 Supplemental Security Income
El Medicaid (not Medicare)
O Temporary Assistance kr Needy Families Program (TANF)
El National School Lunch Program (free program only)
3, INCOME-BASED ELIGIBILITY
To qualify for Lifeline, you must complete either this Section or Section #2 above. To qualify based upon your household income, the income of all
your household members must be less than the amount indicated in the table below. If your household size is greater than 8, the maximum annual
household income to qualify for Lifeline is the income indicated for 8 household members plus $5,346 for each additional household member.
Household Members:
(check the box which Ps) 01 02 03 04 05 El 6 07 El 8 Specify
Maximum Annual Household Income: $15,080 $20,426 $25,772 $31,118 $36,464 $41,810 $47,156 $52,502 $
Customer Annual Household Income: $
- Divorce Decree I Child Support Documents - Unemployment I Workers' Compensation Benefits Statements
- Paystubs (most recent three consecutive months) - Veterans Administration Benefits Statements
- Retirement / Pension Benefit Statements - W2 Statements
- Social Security Benefits Statements
Continued on Next Page
4. LIFELINE PLAN SELECTION
Please check the box for the monthly plan that you would like to sign up for (you may change your plan at the end of any month by calling 1-800-
661-7391):
El PLAN 1 (150 minutes including select international locations; each text message 0 PLAN 4 Unlimited Talk & Text for $29.99 (regularly $39.99)
uses one Plan minute)
El PLAN 2 (250 domestic minutes for free; each text message uses one Plan minute) 0 PLAN 5 Unlimited Talk, Text & Data for $39.99 (regularly $49.99)
0 PLAN 3 1000 Talk & 1000 Text for $19.99 (regularly $29.99)
o If you reside at an address occupied by multiple households, including adults who do not contribute income to your household and/or share
in your household's expenses, please contact Total Call Mobile and you will be provided an additional form to complete. By checking this box,
I certify that I reside at an address occupied by multiple households, have completed and included the additional form with this application.
6. ACTIVATION AND USAGE REQUIREMENTS
Total Call Mobile Lifeline Plans are a prepaid service. When you receive your phone, contact Total Call Mobile at 611 to activate. To keep your
account active, you must use your Lifeline service at least once during any 60 day period by completing an outbound call, purchasing additional
minutes, answering an in-bound call from someone other than Total Call Mobile, or by responding to a direct contact from Total Call Mobile confirm-
ing that you want to continue receiving Lifeline service with Total Call Mobile. If your service goes unused for 60 days, you will no longer be eligible
for Lifeline benefits and your service will be suspended (allowing only 911 calls and calls to customer service) subject to a 30-day cure period
during which you can contact Total Call Mobile to confirm that you want to continue receiving Lifeline service from Total Call Mobile.
By signing and initialing each box below, I affirm that the information contained on this form is true and correct under penalty of perjury:
7 SIGNATURE Date:
(Required)
The information contained within this enrollment form is true and correct. 1 further acknowledge that Lifeline is a federal befit program
(Initial) and that providing false or fraudulent statements or documentation in order to receive Lifeline is punishable bylaw, including fines, impris-
onment, de-enrollment, or being barred from the Lifeline program.
I meet the income-based or program-based eligibility criteria for receiving Lifeline service and have provided documentation of eligibility
(initial) as required by this enrollment form.
I understand that Lifeline is only available for one landline or one wireless phone per household (not both); a violation of this requirement
(Initial) would constitute a violation of law and would result in my de-enrollment from the Lifeline program.
My household is not already receiving Lifeline service from another company. I certify that I am the head of my household and under-
(initial) stand that, for the purposes of the Lifeline program, a household is an individual or group of individuals who live together at the same
address and share the same income and expenses.
I understand that I maybe required to verify my continued eligibility for the Lifeline program at anytime and that failure to do so will result
(Initial) in de-enrollment.
The address listed in this form is my primary residence, not a second home or a business. If I move to a new address, I will notify Total
(Initial) Call Mobile within 30 days. If I checked "Temporary" address in Section 1 above, I acknowledge that I must recertify my address every
90 days.
I will notify Total Call Mobile within 30 days if for any reason I no longer satisfy the criteria for receiving Lifeline including, as relevant, if I
(Initial) no longer meet the income-based or program-based criteria, I begin receiving more than one Lifeline benefit, or another member of my
household starts receiving a Lifeline benefit. I understand that I may be subject to penalties if I fail to follow this requirement.
I authorize Total Call Mobile to access my records in order to verify eligibility as required by federal or state agencies. I understand that
(initial) my information (specifically, my full name, address, date of birth and the last four digits of my social security number) will be transmitted
to administrators managing state and/or federal databases.
.... Lifeline is not transferable. I will only use this phone for my family's own use and will not resell it or give it to others. (Initial)
In addition, I acknowledge that Lifeline enrollment may be terminated by Total Call Mobile in the event that federal or state Lifeline
(initial) Programs are changed or terminated, if I no longer qualify for Lifeline, if Total Call Mobile discontinues its Lifeline participation, if I do not
use the Lifeline phone for 60 days and do not cure during the 30-day cure period, or if I breach the terms and conditions at
totalcallmobile.com/lifeline.
Please mail this application, with supporting documentation to:
Total Call Mobile, Lifeline Program
1411 W. 190th Street, Suite 700, Gardena, CA 90248
EXHIBIT 4
Copy of Proposed Advertising Language and Brochure to Advertise Lifeline
Free Mobile Phone
and Free Service
Through ihe government-supported
Lifeline program, you may qualify
for free service. See inside for details.
This is a State of Idaho brochure,
Lifeline Plans Lifeline Eligibility
Lifeline Terms & Conditions
Service Terms & Conditions
International
Text/rig & Calling Non-Lifeline Plans Refill Options
EXHIBIT 5
FCC-Approved Compliance Plan
(* PUBLIC NOTICE
Federal Communications Commission News Media Information 202! 418-0500
445 12 St., S.W. Internet: http:llwwwfcc.gov
Washington, D.C. 20554 TTY: 1-888-835-5322
PA 12-828
Release Date: May 25, 2012
WIRELINE COMPETITION BUREAU APPROVES THE COMPLIANCE PLANS OF
AMERICAN BROADBAND & TELECOMMUNICATIONS, BUDGET PREPAY, CONSUMER
CELLULAR, GLOBAL CONNECTION, TERRACOM AND TOTAL CALL
WC Docket Nos. 09-197 and 11-42
The Wireline Competition Bureau (Bureau) approves compliance plans of six
telecommunications carriers: American Broadband & Telecommunications; Budget Prepay, Inc.;
Consumer Cellular, Inc.; Global Connection, Inc. of America; TerraCorn, Inc.: and Total Call Mobile,
Inc. filed pursuant to the Lifeline Reform Order as a condition of obtaining forbearance from the facilities
requirement of the Communications Act of 1934, as amended (the Act), for the provision of Lifeline
service.
The Act provides that in order to be designated as an eligible telecommunications carrier for the
purpose of universal service support, a carrier must "offer the services that are supported by Federal
universal service support mechanisms.. . either using its own facilities or a combination of its own
facilities and resale of another carrier's services The Commission recently amended its rules to
define voice telephony as the supported service and removed directory assistance and operator services,
among other things, from the list of supported services .3 As a result of these amendments, many Lifeline-
only ETCs that previously met the facilities requirement by relying on operator services, directory
assistance or other previously supported services no longer meet the facilities requirement of the Act.4 In
the Lifidine Reform Order, the Commission found that a grant of blanket forbearance of the facilities
See Lfe!ine and Link Up Reform and Modernization etal. WC Docket No.11-42 et al., Report and Order and
Further Notice of Proposed Rulemaking, FCC 12-11, at paras. 379-380 (rel. Feb. 6, 2012) (Lifeline Reform Order').
A list of the compliance plans approved through this Public Notice can be found in the Appendix to this Public
Notice.
247 U.S.C. § 214(e)(1)(A).
See Connect America Fund, WC Docket No. 10-90 etal., Report and Order and Further Notice of Proposed
Rulemaking, 26 FCC Red 17663, 17692-93, paras. 77-78,80 (2011) (USF/ICC Transformation Order); pets. for
review pending sub noni, In i-c: FCC 11-161, No. 11-9900 (10th Cir. filed Dec. 8, 2011)-, connect America Fund,
WC Docket No. 10-90 etal., Order on Reconsideration, 26 FCC Red 17633, 17634-35, para. 4 (2011) (USF/ICC
Trans/hrmaiion Order on Reconsideration).
' See Lifeline Reform Order, FCC 12-11. at para. 366, App. A; USF11C'C Tranforniation Order on Reconsideration
at para. 4. Some ETCs have included language in their compliance plans indicating that they have facilities or plan
to acquire facilities in the future. See. e.g.. Budget PrePay, Inc. Petition for Designation as an Eligible
Telecommunications Carrier, WC Docket Nos. 09-197 and 11-42, Compliance Plan of Budget PrePay, Inc. at 3 a. 6
(filed May 1. 2012). To the extent ETCs seek to avail ther)lselves of the conditional forbearance relief established in
the Lifeline Reform Order, we presume they lack facilities to provide the supported service under section 54.101 and
54.401 of the Commission's rules. See 47 C.F.R. §§ 54.101 and 54.401. Such ETCs must comply with the
compliance plan approved herein in each state or territory where they are designated as an ETC, regardless of their
claim of facilities for other purposes, such as eligibility for state universal service funding.
requirement. subject to certain public safety and compliance obligations, is appropriate for carriers
seeking to provide Lifeline-only service.5 Therefore, in the Li/èline Reform Order, the Commission
conditionally granted forbearance from the Act's facilities requirement to all telecommunications carriers
seeking Lifeline-only ETC designation, subject to the following conditions: (I) compliance with certain
911 and enhanced 911 (E91 1) public safety requirements; and (2) Bureau approval of a compliance plan
providing specific information regarding the carrier and its service offerings and outlining the measures
the carrier will take to implement the obligations contained in the Order.6
The Bureau has reviewed the compliance plans listed in the Appendix for conformance with the
Ljiline Rejbrm Order, and now approves those six compliance plans.7
Filings, including the Compliance Plans identified in the Appendix, and comments are available
for public inspection and copying during regular business hours at the FCC Reference information
Center, Portals II, 445 12tl Street, S.W., Room CY-A257, Washington, D.C. 20554. They may also be
purchased from the Commission's duplicating contractor, Best Copy and Printing, Inc., Portals II, 445
12th Street, S.W., Room CY-B402, Washington, D.C. 20554, telephone: [phone], fax: (202) 448-
5563, or via email www.bcpiweb.com.
People with Disabilities: To request materials in accessible formats for people with disabilities
(Braille, large print, electronic files, audio format), send an email to [e-mail] or call the
Consumer & Governmental Affairs Bureau at [phone] or TTY [phone].
For further information, please contact Divya Shenoy, Telecommunications Access Policy
Division, Wireline Competition Bureau at [phone] or TTY [phone].
- FCC -
5 See Lifeline Reform Order, FCC 12-I1 at paras. 368-381
See Id. at paras. 373 and 389. Subsequently, the Bureau provided guidance for carriers submitting compliance
plans pursuant to the Lifeline Reform Order. Wireline Competition Bureau Provides Guidance or the Submission of
Compliance Plans Pursuant to the Lifeline Reform Order, WC Docket Nos. 09-197 and 11-42. Public Notice, 27
FCC Red 2186 (Wireline Comp. Bur. 2012).
The Commission has not acted on any pending ETC petitions filed by these carriers, and this Public Notice only
approves the compliance plans of the carriers listed above. While these compliance plans contain information on
each carrier's Lifeline offering, we leave it to the designating authority to determine whether or not the carrier's
Lifeline offerings are sufficient to serve consumers. See Lifeline Reform Order, FCC 12-11 at paThs. 50 and 387.
Appendix
Petitioner Compliance Plans Date of Filing Docket
As Captioned by Numbers
Petitioner
American Broadband & Telecommunications American April 27, 2012 09-197; 11-42
Broadband &
Telecommunications
Revised Compliance
Plan
Budget PrePay, Inc. Compliance Plan of May 1, 2012 09-197; 1142
Budget PrePay, Inc.
Consumer Cellular, Inc. Consumer Cellular April 18, 2012 09-197; 1142
Amended Revised
Compliance Plan
Global Connection, Inc. of America Global Connection April 30, 2012 09-197; 1142
Inc. of America
CompliancePlan
TerraCom, Inc. TerraCom, Inc. May 1, 2012 09-197; 1142
Second Revised
Blanket Forbearance
Compliance Plan
Total Call Mobile, Inc. Total Call, Inc. May 17, 2012 09-197; 1142
Revised Compliance
Plan
KELLEY DRYE & WARREN LLP
LIMITED LIABILITY PAITTIIERSIIIP
WASHINGTON HARBOUR, SUITE 400 NEW YORK, NV
LOS ANGELES. CA 3050 K STREET, NW
CHICAGO. IL WASHINGTON, D.C. 20007-5108
STAMFORD. CT
PARSIPPANY, NJ
[phone]
BRUSSELS, BELGIUM
AFFILIATE OFFICES
MUMBAI. INDIA
FACSIMILE
[phone]
www.kelleydrye.com
STEVEN A. AUGUSTINO
DIRECT LINE: [phone]
EMAIL: $[e-mail]
May 14, 2012
BYECFS
Ms. Marlene H. Dortch
Secretary
Federal Communications Commission
445 12h Street, SW
Washington, D.C. 20554
Re: Total Call Mobile, Inc., WC Docket Nos. 09-197 and 11-42
Dear Secretary Dortch:
On March 16, 2012, Total Call Mobile, Inc. ("TCM"), by its attorneys, submitted
a Compliance Plan to the Federal Communications Commission ("Commission" or "FCC") in
accordance with the Commission's February 6, 2012 Lifeline and Link Up Reform and
Modernization et al. Report and Order. Attached to the Compliance Plan, as Exhibit B, was a
sample of TCM's Application Form ("Form") for its Lifeline services.
TCM has continued to refine its plans for providing Lifeline services. In addition,
through discussions of its Compliance Plan with Commission staff, TCM has identified
additional revisions which will help clarify its compliance with the requirements in the Lifeline
Reform Order. Accordingly, TCM hereby submits a revised Compliance Plan demonstrating its
compliance with applicable FCC Lifeline rules. This plan supplements, restates and replaces the
Compliance Plan submitted on March 16, 2012.
For the staffs convenience, TCM describes the principal changes to the plan
below. The Revised Compliance Plan:
• Clarifies the procedures used by TCM personnel to verify Lifeline
service applicant eligibility (see pp. 5-7);
• Provides further explanation of the technical and financial
capabilities of TCM, of its parent, Total Call International, Inc.,
DCOI /SMITD/477461 .2
KELLEY DRYE & WARREN LLP
Ms. Marlene H. Dortch
May 14, 2012
Page 2
and of the majority owner of TCJ, KDDI of America (see pp. 21-
23 and Exh. A);
• Inserts Exhibits A and B and re-labels the remaining exhibits
accordingly;
• Revises the Model Application Form (now Exhibit D) to clarify
eligibility for large households under income-based eligibility, to
add a check-box for applicants residing at an address occupied by
multiple households, and to amend and clarify customer
certifications;
• Adds a copy of an internal verification form that will be used by
TCM to record the type of documentation used to verify customer
eligibility (see Exhibit B);
• Makes minor clarifications throughout (see pp. 1, 6-7, 14, 18, 22-
23)
In addition, on February 29, 2012,' the Wireline Competition Bureau provided
guidance on the compliance plans that must be submitted to the Bureau by earners seeking to
avail themselves of the Commission's conditional grant of forbearance in the Lifeline Reform
Order. The guidance summarized the elements that non-facilities based Lifeline-only ETCs
must include within their compliance plans. For ease of review, Total Call Mobile also attaches
to this letter an index identifying the sections in its Compliance Plan that address each of the
items listed in the Bureau Public Notice. This index follows the organization of the Public
Notice, at page 3.
TCM requests that the Commission expeditiously approve this Compliance Plan
in order to permit it to begin serving Lifeline customers on a non-facilities basis in its ETC states
as soon as possible.
Wireline Competition Bureau Provides Guidance for the Submission of Compliance
Plans Pursuant to the Lifeline Reform Order, WC Docket Nos. 09-197, 11-42, DA 12-314
(rel. Feb. 29, 2012).
Dco1/sMI'rD/477461 .2
KELLEY DRYE & WARREN LLP
Ms. Marlene H. Dortch
May 14, 2012
Page 3
Please contact the undersigned at [phone] if you have any questions.
Respectfully submitted,
LA . 4L_
Steven A. Augustino
Counsel to Total Call Mobile, Inc.
Attachments
cc: Garnet Hanly, FCC (via e-mail)
Divya S. Shenoy, FCC (via e-mail)
Charles Tyler, FCC (via e-mail)
Best Copy and Printing, Inc. (via e-mail)
DCOI/SMITD/47746 1.2
Compliance Plan Index
By Public Notice dated February 29, 2012,' the Wireline Competition Bureau provided guidance
on the compliance plans that must be submitted to the Bureau by carriers seeking to avail
themselves of the Commission's conditional grant of forbearance in the Lifeline Rform Order.
The guidance summarized the elements that non-facilities based Lifeline-only ETCs must
include within their compliance plans. For ease of review, Total Call Mobile hereby provides an
index identifying the sections in its Compliance Plan that address each of the items listed in the
Bureau Public Notice. This index follows the organization of the Public Notice, at page 3.
1. Information about the carrier and the Lifeline plans it intends to offer
Requirement Page number in Compliance Plan
(a)names and identifiers used by the carrier, its
holding company and affiliates
fn 1
(b)detailed information demonstrating that the
carrier is financially and technically capable of
providing the supported Lifeline service in
compliance with the Commission's rules
pp. 21-23
(c)detailed information, including geographic
locations, of the carrier's current service offerings
if the carrier currently offers service
p. 22 (non-Lifeline services)
(d)the terms and conditions of each Lifeline
service plan offering, including rates, the number
of minutes provided, and additional charges, if any,
for toll calls
pp. 21, 23-24, Exhibits E-G.
(e)all other certifications required under newly
amended section 54.202 of the Commission's rules
pp. 23-24
2. Compliance with subscriber eligibility rules
Requirement Page number in Compliance Plan
all of the consumer eligibility, consumer
enrollment, and re-certification procedures, as
required by Section VI and Appendix C of the
Lifeline Reform Order
pp. 4-13 (initial enrollment)
pp. 13-14 (verification/re-certification)
pp. 14-15 (non-usage policy)
pp. 16-17 (one per household rule)
a copy of the carrier's certification form Exhibit D
Wireline Competition Bureau Provides Guidance for the Submission of Compliance
Plans Pursuant to the Lifeline Reform Order, WC Docket Nos. 09-197, 11-42, DA 12-314
(rel. Feb. 29, 2012).
DCOIIAUGUS/477414. I
3. Compliance with 911 /E 91 1 rules
Requirement Page number in Compliance Plan
A detailed explanation of how the carrier will pp. 3-4
comply with the forbearance conditions relating to
public safety and 911 /E91 I access
4.Compliance with marketing and disclosure rules
Requirement Page number in Compliance Plan
A detailed explanation of how the carrier will pp 17-18
comply with the Commission's marketing and Exhibit D (certification form)
disclosure requirements for participation in the Exhibit F (sample brochure)
Lifeline program I
5.Compliance with waste, fraud and abuse protections
Requirement Page number in Compliance Plan
A detailed explanation of the carrier's procedures pp 4-13 (initial enrollment)
and efforts to prevent waste, fraud and abuse in pp 15-18 (additional protections)
connection with Lifeline funds
procedures the carrier has in place to prevent pp 15-17
duplicate Lifeline subsidies within its own
subscriber base
procedures the carrier undertakes to de-enroll pp 16-17 See also, application and
subscribers receiving more than one Lifeline certification forms (#2, above) and
subsidy per household marketing methods (#4, above)
information regarding the carrier's toll limitation not applicable (see p. 24)
service, if applicable
information regarding the carrier's non-usage pp. 14-15
policy, if applicable
2
DCOI/AI.JGUS/477414, 1
Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
) In the Matter of )
)
Telecommunications Carrier Eligibility to Receive ) WC Docket No. 09-197
Universal Service Support )
)
Lifeline and LinkUp Reform and Modernization ) WC Docket No. 11-42
)
Total Call Mobile, Inc. (Compliance Plan) )
TOTAL CALL MOBILE, INC.'S REVISED COMPLIANCE PLAN
Steven A. Augustino
Denise N. Smith
Kelley Drye & Warren, LLP
3050 K Street, NW
Suite 400
Washington, D.C. 20007
[phone]
Counsel to Total Call Mobile, Inc.
May 14, 2012
TABLE OF CONTENTS
Page
1. TOTAL CALL MOBILE'S COMPLIANCE PLAN......................................................... 3
A. Total Call Mobile's Access to 911 and E911 Services..........................................3
B. Procedures To Enroll A Subscriber in Lifeline......................................................4
1 . Policy......................................................................................................... 4
2. Eligibility Determination ............................................................................ 5
3. Subscriber Certifications for Enrollment ................................................... 7
4. Call Center Procedures.............................................................................. 9
5. In-Person Sales Efforts .............................................................................. 9
6. Applications, Information and Disclosures.............................................. 10
C. Annual Verification Procedures........................................................................... 13
D. Activation and Non-Usage................................................................................... 14
E. Additional Measures to Prevent Waste, Fraud and Abuse .................................. 15
F. Company Reimbursements From the Fund......................................................... 18
G. Annual Company Certifications .......................................................................... 19
H. Cooperation with State and Federal Regulators................................................... 20
II. DESCRIPTION OF LIFELINE SERVICE OFFERINGS .............................................. 21
III.DEMONSTRATION OF FINANCIAL AND TECHNICAL CAPABILITIES
AND CERTIFICATIONS REQUIRED FOR ETC DESIGNATION............................. 21
IV.CONCLUSION................................................................................................................ 25
-1-
Before the
FEDERAL COMMUNICATIONS COMMISSION
Washington, D.C. 20554
)
In the Matter of )
)
Telecommunications Carrier Eligibility to Receive )
Universal Service Support ) WC Docket No. 09-197
) WC Docket No. 11-42
Lifeline and LinkUp Reform and Modernization )
) Total Call Mobile, Inc. (Compliance Plan) )
TOTAL CALL MOBILE, INC.'S REVISED COMPLIANCE PLAN
On May 25, 2011, Total Call Mobile, Inc. ("TCM" or "Company")' filed a
Petition for Forbearance ("Petition") requesting the Commission forbear from enforcement of
section 214(e)(1)(A) of the Communications Act of 1934, as amended, 47 U.S.C. § 214(e)(1)(A),
which requires eligible telecommunications carriers ("ETCs") to use their own facilities to
provide services supported by the Universal Service Fund ("USF").
On February 6, 2012, the Federal Communications Commission ("FCC" or
"Commission") granted TCM's Petition for Forbearance, conditioned on fulfillment of the
The Company hereby also reports its corporate and trade names, along with its holding
company, operating companies and affiliates as follows: Total Call International is the
parent of Total Call Mobile; KDDI of America is the majority owner of Total Call
International; Locus Telecommunications and KDDI Global are affiliates of Total Call
International. A copy of KDDI Corporation's "Financial Statements Summary for the
Year ended March 31, 2012 Japan GAAP]" and biographies for all of the Executive
Board Directors showing KDDI's technical and financial capabilities is attached hereto as
Exhibit A.
obligations detailed in the Lifeline Reform Order,2 which also required each carrier to submit to
the Commission for approval a Compliance Plan outlining the measures it will take to implement
the conditions imposed by the Commission in its Lifeline Reform Order.
The Company will comply fully with all conditions set forth in the Lifeline
Reform Order, as well as with the Commission's Lifeline rules and policies more generally.3
Company will comply with 911 requirements as described below in its Compliance Plan.
Company also will implement the foregoing objectives and the other objectives described in the
Lifeline Reform Order. Specifically, this Compliance Plan: (1) describes the specific measures
that the Company will take to implement the obligations contained in the Lifeline Reform Order,
including the procedures the Company follows in enrolling a subscriber in Lifeline and
submitting for reimbursement for that subscriber from the Fund; (2) describes the materials
related to initial and ongoing certifications and the sample marketing materials; and (3) provides
a detailed description of how the Company offers Lifeline services, the geographic areas in
which it offers services, and a detailed description of the Company's Lifeline service plan
offerings.
2 See Lifeline and Link Up Reform and Modernization, Lifeline and Link Up, Federal-Stale
Joint Board on Universal Service, Advancing Broadband Availability Through Digital
Literacy Training, WC Docket No. 11-42, WC Docket No. 03-109, CC Docket No. 96-
45, WC Docket No. 12-23, Report And Order and Further Notice of Proposed
Rulemaking, FCC 12-11, ¶j 521, 523 (Feb. 6, 2012) ("Lifeline Reform Order"). TCM
herein submits the information required by the Compliance Plan Public Notice. See
Wireline Competition Bureau Provides Guidance for the Submission of Compliance
Plans Pursuant to the Lifeline Reform Order, WC Docket Nos. 09-197, 11-42, Public
Notice, DA 12-314 (rel. Feb. 29, 2012).
In addition, this Compliance Plan is consistent with the compliance plan filed by Cricket
Communications, Inc. See Notice of Ex Parte Communication of Cricket
Communications, Inc., WC Docket No. 09-197 (Sept. 23, 2011) ("Cricket Compliance
Plan"). The Wireline Competition Bureau approved the Cricket Compliance Plan on
February 7, 2012. See Telecommunications Carriers Eligible for Universal Service
Support, Cricket Communications, Inc. Petition for Forbearance, WC Docket No. 09-
197, Order, DA 12-158 (Feb. 7, 2012).
DCOI/SMITD/472719. 7
2
I. TOTAL CALL MOBILE'S COMPLIANCE PLAN
A. Total Call Mobile's Access to 911 and E911 Services
Pursuant to the Lifeline Reform Order, forbearance is conditioned upon Company
(1) providing its Lifeline subscribers with 911 and E911 access, regardless of activation status
and availability of minutes; and (2) providing its Lifeline subscribers with E91 I-compliant
handsets and replacing, at no additional charge to the subscriber, noncompliant handsets of
Lifeline-eligible subscribers who obtain Lifeline-supported services.4 Company will comply
with these conditions upon initiation of its Lifeline service.
Company will provide its Lifeline customers with access to 911 and E91 I
services immediately upon activation of service. The Commission and consumers are hereby
assured that all Company customers will have available access to emergency calling services at
the time that the handset is activated, and that such 911 and E91 I access will be available from
Company handsets, even if the account associated with the handset has no minutes remaining.
The Company's existing practices currently provide access to 911 and E91 1
services for all customers. Company uses Sprint as its underlying network provider/carrier.
Sprint routes 911 calls from Company's customers in the same manner as 911 calls from Sprint's
own retail customers. To the extent that Sprint is certified in a given PSAP territory, this 911
capability will function the same for Company. Company (via Sprint) also currently enables 911
emergency calling services for all properly activated handsets regardless of whether the account
associated with the handset is active, suspended or terminated. Finally, the Company (via
Sprint) transmits all 911 calls initiated from any of its handsets even if the account associated
with the handset has no remaining minutes.
See Lifeline Reform Order, 1373.
DCOI/SMITD/4727 19. 7
Company will ensure that all handsets used in connection with the Lifeline service
offering are E91 I -compliant. In point of fact, Company's phones have always been and will
continue to be 911 and E91 I -compliant. Company uses phones that have been through a
stringent certification process with Sprint, which, among other things, ensures that the handset
models used meet all 911 and E911 requirements. As a result, any customer that qualifies for
and elects Lifeline service will already have a 911 /E91 1-compliant handset, which will be
confirmed at the time of enrollment in the Lifeline program. Any new customer that qualifies for
and enrolls in the Lifeline program is assured of receiving a 911 1E9 11-compliant handset as well,
free of charge.
B. Procedures To Enroll A Subscriber in Lifeline
1. Policy
The Company will comply with the uniform eligibility criteria established in new
section 54.409 of the Commission's rules (when it becomes effective on June 1, 2012), as well as
any additional certification and verification requirements for Lifeline eligibility in states where
the Company is designated as an ETC. In states where there are no state-imposed requirements,
the Company will comply with the certification and verification procedures in effect in that state
as reflected on the website of the Universal Service Administration Company ("USAC").5 For
any states that do not have established rules of procedure in place, the Company will comply
with the certification and verification procedures in effect in that state as reflected in the Lifeline
Reform Order and the rules.
All subscribers will be required to demonstrate eligibility based at least on: (1)
household income at or below 135% of the Federal Poverty Guidelines for a household of that
See Cricket Compliance Plan at 3.
DCOI/SMITD/472719. 7
KI
size; or (2) the household's participation in one of the federal assistance programs listed in new
section 54.409(a)(2) and 54.409(a(3) of the Commission's rules. In addition, through the
certification requirements described below, Company will confirm that the subscriber is not
already receiving a Lifeline service and no one else in the subscriber's household is subscribed to
a Lifeline service.
2. Eligibility Determination
If Company cannot determine a prospective subscriber's eligibility for Lifeline by
accessing income databases or program eligibility databases, Company's employees or agents
("Company personnel") will review documentation establishing eligibility pursuant to the
Lifeline rules.6 All personnel who interact with actual or prospective customers will be trained
to assist Lifeline applicants in determining whether they are eligible to participate based on the
federal and state-specific income-based and/or program-based criteria. These personnel will be
trained to answer questions about Lifeline eligibility, and will review required documentation to
determine whether it satisfies the Lifeline Reform Order and state-specific eligibility
requirements using state-specific checklists.7
Proof of Eligibility. Company personnel will be trained on acceptable
documentation required to establish income-based and program-based eligibility.8 Acceptable
documentation of program eligibility includes: (1) the current or prior year's statement of
benefits from a qualifying state or federal program; (2) a notice letter of participation in a
qualifying state or federal program; (3) program participation documents (e.g., the consumer's
Supplemental Nutrition Assistance Program (SNAP) electronic benefit transfer card or Medicaid
6 See Lifeline Reform Order, 1100; 47 C.F.R. § § 54.410(b)(l)i)(B), 54.410(c)(l)(i)(B);
Cricket Compliance Plan at 4.
See Cricket Compliance Plan at 6.
See Lifeline Reform Order, 1101.
DCOI/SMITD/4727 19. 7
5
participation card (or copy thereof)); or (4) another official document evidencing the consumer's
participation in a qualifying state or federal program.9
Acceptable documentation of income eligibility includes the prior year's state or
federal tax return, current income statement from an employer or paycheck stub, a Social
Security statement of benefits, a Veterans Administration statement of benefits, a
retirement/pension statement of benefits, an Unemployment/Workmen's Compensation statement
of benefits, federal notice letter of participation in General Assistance, or a divorce decree, child
support award, or other official document containing income information for at least three
months time. 10
Company personnel will examine supporting documentation for each Lifeline
applicant, and will record the type of documentation used to satisfy the income- or program-
based criteria)1 As specified in FCC rules, the Company will not retain a copy of the
documentation reviewed. 12 However, for audit and recordkeeping purposes, the Company will
record eligibility verification information on a separate form. This "Company-only" form will
be completed by Total Call Mobile personnel, who will be trained to complete the form,
indicating what proof of eligibility was reviewed, and retain the form for each applicant
determined to be eligible for service. The separate form is attached hereto as Exhibit B.
Where the Company personnel conclude that proffered documentation is
insufficient to establish such eligibility, the Company will deny the associated application and
Id. and 47 C.F.R. § 54.410(c)(1)(i)(B).
See Lifeline Reform Order, ¶101; 47 C.F.R. § 54.410.(b)(l)(i)(B).
See Lifeline Reform Order, ¶101; 47 C.F.R. §§ 54.410(b)(1)(iii), 54.410(c)(1)(iii).
12 See Lifeline Reform Order, ¶101; 47 C.F.R. § § 54.410(b)(1)(ii), 54.410(c)(1)(ii).
DCOI/SMITD/472719, 7
6
inform the applicant of the reason for such rejection. 3 In the event that Company personnel
cannot ascertain whether documentation of a specific type is sufficient to establish an applicant's
eligibility, the matter will be escalated to supervisory personnel. 14 In addition, as described in
Section I.B.3, below, subscribers will complete certification forms that, among other things,
demonstrate the subscriber's eligibility to receive Lifeline support.
De-Enrollment for Ineligibility. If Company has a reasonable basis to believe that
one of its Lifeline subscribers no longer meets the eligibility criteria, Company will notify the
subscriber of impending termination in writing and in compliance with any applicable state
dispute resolution procedures applicable to Lifeline termination, and give the subscriber 30 days
to demonstrate continued eligibility. 15 A demonstration of eligibility must comply with the
annual verification procedures below and found in new rule section 54.410(f), including the
submission of a certification form.
3. Subscriber Certifications for Enrollment
The Company will implement certification policies and procedures that enable
consumers to demonstrate their eligibility for Lifeline assistance to Company personnel as
detailed in the Lifeline Reform Order, together with any additional state certification
requirements. 16 The Company shares the Commission's concern about abuse of the Lifeline
program and is thus committed to the safeguards stated herein, with the belief that these
See Cricket Compliance Plan at 6.
See Cricket Compliance Plan at 6.
Is See Lifeline Reform Order, ¶ 143; 47 C.F.R. § 54.405(e)(1).
Lifeline Reform Order, 161; 47 C.F.R. § 54.410(a).
DCOI/SMITD/47271 9. 7
'4
procedures will prevent the Company's customers from engaging in such abuse of the program,
inadvertently or intentionally. 17
TCM will implement certification procedures that require consumers to
demonstrate their eligibility for Lifeline assistance. Customers will be able to sign up for
Lifeline assistance by contacting TCM via telephone, facsimile, or the internet. Company
personnel will verbally explain the eligibility criteria to consumers when they are enrolling in
person or over the phone. 18 At the point of sale, consumers will be provided with printed
information describing TCM's Lifeline program in detail, including federal and state specific
eligibility requirements, and instructions for enrolling, a description of the one-per-household
rule and a copy of USAC's printed material describing the one-per-household rule. 19 These
materials (like all Lifeline marketing materials) also will clearly identify supported plans as
"Lifeline" plans, consistent with TCM' s current practice and policies. Consumers will be
directed to a toll-free telephone number and to TCM's website, which will contain a link to
information regarding the Company's Lifeline service plan, including a detailed description of
the program, rates, and federal and state-specific eligibility criteria.
1CM will have direct contact with all customers applying for participation in the
Lifeline program either by mail or by phone and all marketing materials will include TCM's
customer service number. Retailers and distributors will be able to assist customers in
completing applications but will provide 1CM' s customer service number for further questions
and assistance. Retailers or customers will then directly send the applications and supporting
See Cricket Compliance Plan at 3.
18 See Lifeline Reform Order, ¶ 123.
19 See Lifeline Reform Order, 179.
DCOI/SMITD/472719. 7
8
documents to TCM. Retailers will not retain any copies of the customer application or
supporting documentation, and company personnel will review and process all applications.

4. Call Center Procedures
Consumers will be directed to call a toll-free number to complete an application
over the phone. The application will then be mailed to the customer for signature under penalty
of perjury and for the submission of supporting documentation. The signed application and
support documentation must be mailed to the address provided by the Company (or, if available
to the consumer, returned by facsimile or electronic transmission). Processing of consumers'
applications, including review of all application forms and relevant documentation will be
performed under TCM's supervision by managers thoroughly trained in the requirements of the
Lifeline program. TCM will ensure that all required documentation is taken care of properly by
using federal and state-specific compliance checklists.
TCM will emphasize the "one Lifeline phone per household" restriction during
the initial interview with the potential customer when they call into the call center. The call
center introduction script substantially in the form TCM would use is attached as Exhibit C.

5. In-Person Sales Efforts
TCM will promote its Lifeline services through many channels. One sales
channel will be in-person sales events staffed by TCM representatives or agents. At these
events, customers will be allowed to sign up, in-person, for Lifeline service. TCM
representatives or agents, fully trained in Lifeline requirements, will conduct an interview,
ensuring that the potential customer does not already receive a Lifeline subsidy. Documentation
proving eligibility for the program will also be collected and an application will be completed by
DCOI/SMITD/4727 19. 7
the customer. Only after completing all required eligibility verification will TCM issue phones
to the customer.
At retail outlets where trained TCM representatives or agents are not present,
customers will not have access to Lifeline services (or receive a Lifeline handset) at the retail
location. Instead, customers will be directed via print ads and information brochures to contact
TCM directly, and to submit the Lifeline service application directly to TCM. Through TCM's
certification procedures, the company would verify that the individual qualifies for a Lifeline
plan (i.e. that there is no duplication, and that the individual qualifies by virtue of participation in
an eligible state or federal low income program). Only after the customer is verified as
qualifying to receive Lifeline will the phone be provided to the customer via mail or subsequent
pickup.
6. Applications, Information and Disclosures
Every applicant will be required to complete an application/certification process
containing disclosures, and collecting certain information and certifications as discussed below. 20
Disclosures. TCM' s application and certification process will include the
following disclosures: (1) Lifeline is a federal benefit and that willfully making false statements
to obtain the benefit can result in fines, imprisonment, dc-enrollment or being barred from the
program; (2) only one Lifeline service is available per household; (3) a household is defined, for
purposes of the Lifeline program, as any individual or group of individuals who live together at
the same address and share income and expenses; (4) a household is not permitted to receive
Lifeline benefits from multiple providers; (5) violation of the one-per-household limitation
constitutes a violation of the Commission's rules and will result in the applicant's de-enrollment
20 See Model Application/Certification Form (Maryland), included as Exhibit D. See
Compliance Plan Public Notice at 3.
DCOI/SMJTD/4727 19. 7
10
from the program; and (6) Lifeline is a non-transferable benefit and the applicant may not
transfer his or her benefit to any other person.2
Applicants will also be informed that (1) the service is a Lifeline service,
(2) Lifeline is a government assistance program, and (3) only eligible consumers may enroll in
the program.22
In addition, Company will notify the applicant that the prepaid service must be
personally activated by the subscriber and the service will be deactivated and the subscriber de-
enrolled if the subscriber does not use the service for 60 days. 23
Information Collection. TCM will also collect the following information from the
applicant in the application/certification process: (1) the applicant's full name; 24 (2) the
applicant's full residential address (P.O. Box is not sufficient 2); (3) whether the applicant's
residential address is permanent or temporary; (4) billing address will not be requested as the
service will be on TCM's prepaid platform (i.e. there will be no bill sent); (5) the applicant's date
of birth; (6) the last four digits of the applicant's Social Security number; (7) if the applicant is
seeking to qualify for Lifeline under the program-based criteria, the name of the qualifying
assistance program from which the applicant, his or her dependents, or his or her household
receives benefits; 26 and (8) if the applicant is seeking to qualify for Lifeline under the income-
based criterion, the number of individuals in his or her household.27
21 See Lifeline Reform Order, 1121; 47 C.F.R. § 54.410(d)(1).
22 See 47 C.F.R. § 54.405(c).
23 See Lifeline Reform Order, 1114.
24 See Cricket Compliance Plan at 4.
25 See Lifeline Reform Order, 187.
26 See Cricket Compliance Plan at 4.
27 See 47 C.F.R. § 54.410(d)(2). See Cricket Compliance Plan at 4.
DCOI/SM1TD1472719. 7
Applicant Certification. Consistent with new rule section 54.410(d)(3), TCM will
require the applicant to certify, under penalty of perjury, in writing or by electronic signature or
interactive voice response recording, 28 the following:
1.the applicant meets the income-based or program-based eligibility criteria for
receiving Lifeline;
2.the applicant will notify the Company immediately, and, in any event, within a
maximum of 30 days, if for any reason he or she no longer satisfies the criteria for
receiving Lifeline including, as relevant, if the applicant no longer meets the income-
based or program-based criteria for receiving Lifeline support, if the applicant is
receiving more than one Lifeline benefit, or if another member of the applicant's
household is receiving a Lifeline benefit;
3.if the applicant moves to a new address, he or she will provide that new address to
the Company within 30 days;
4.if the applicant provided a temporary residential address to the Company, the
applicant will be required to verify his or her temporary residential address every 90
days;
5.the applicant's household will receive only one Lifeline service and, to the best of
the applicant's knowledge, the applicant's household is not already receiving a Lifeline
service; 29
6.the information contained in the applicant's certification form is true and correct
to the best of the applicant's knowledge;
7.the applicant acknowledges that providing false or fraudulent information to
receive Lifeline benefits is punishable by law; and
8.the applicant acknowledges that the applicant may be required to re-certify his or
her continued eligibility for Lifeline at any time, and the applicant's failure to re-certify
as to the applicant' s continued eligibility will result in de-enrollment and the termination
of the applicant's Lifeline benefits pursuant to the de-enrollment policy included below
and in the Commission's rules.
Applicants will also be required to certify under penalty of perjury that they are
head of their household and receive Lifeline-supported service only from TCM. Penalties for
28 See Lifeline Reform Order. ¶j 168-69; 47 C.F.R. § 54.419.
29 See Cricket Compliance Plan at 4.
DCOI/SMITD/472719. 7
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perjury will be clearly stated on the certification form. 30 This will be accomplished by a
certification form substantially similar in format to the Model Application/Certification Form
(Maryland), included as Exhibit D. Customers will be required to sign and date this statement.
In addition, the applicant will be required to authorize TCM to access any records
required to verify the applicant's statements in the application/certification process and to
confirm the applicant's eligibility for the Company Lifeline credit. 31 The applicant must also
authorize TCM to release any records required for the administration of the Company Lifeline
credit program, including to USAC to be used in an Lifeline program eligibility database. 32
C. Annual Verification Procedures
1CM will annually re-certify all subscribers by querying the appropriate
eligibility databases (when it becomes available) or, if no eligibility database is available, by
obtaining a signed certification from each subscriber consistent with the certification
requirements above and new section 54.410(d) of the rules. This certification will include a
confirmation that the applicant's household will receive only one Lifeline service and, to the best
of the subscriber's knowledge, the subscriber's household is receiving no more than one Lifeline
service. 33 Company will notify each participating Lifeline customer prior to his or her service
anniversary date that he or she must confirm his or her continued eligibility in accordance with
the applicable requirements. 34 Further, the verification materials will inform the subscriber that
See Cricket Compliance Plan at 5.
31 See Cricket Compliance Plan at 5.
32 See 47 C.F.R. § 54.404(b)(9). The application/certification form will also describe the
information that will be transmitted, that the information is being transmitted to USAC to
ensure the proper administration of the Lifeline program and that failure to provide
consent will result in the applicant being denied the Lifeline service. See id. See also
Cricket Compliance Plan at 5.
See Lifeline Reform Order, 1120 and Cricket Compliance Plan at 8.
See Cricket Compliance Plan at 8.
DCOI /SMITD/47271 9. 7
13
he or she is being contacted to re-certify his or her continuing eligibility for Lifeline and if the
subscriber fails to respond, he or she will be de-enrolled in the program. 35
2012 Verification. Company will re-certify (if applicable) the eligibility of each
of its existing subscribers as of June 1, 2012 on a rolling basis by the end of 2012 and report the
results to USAC by January 31, 2013.36 Company will contact its subscribers via text message to
their Lifeline supported telephone, or by mail, phone, email or other Internet communication.
The notice will explain the actions the customer must take to retain Lifeline benefits, when
Lifeline benefits maybe terminated, and how to contact the Company.
Verification De-Enrollment. Company will give subscribers 30 days to respond
to the annual verification inquiry. Company will de-enroll subscribers that do not respond to the
annual verification or fail to provide the required certification. 37 If the subscriber does not
respond, the Company will send a separate written notice explaining that failure to respond
within 30 days will result in the subscriber's de-enrollment from the Lifeline program. If the
subscriber does not respond within 30 days, Company will de-enroll the subscriber within five
business days thereafter.
D. Activation and Non-Usa ge
Each subscriber activates the service by placing a call to TCM. Company will not
consider a prepaid subscriber activated, and will not seek reimbursement for Lifeline for that
subscriber, until the subscriber places this call demonstrating usage of the phone. 38 In addition,
after service activation, Company will provide a de-enrollment notice to subscribers that have
See Lifeline Reform Order, ¶ 145.
36 See Lifeline Reform Order, ¶ 130.
See Lifeline Reform Order, 1142; 47 C.F.R. § 54.54.405(e)(4).
See Lifeline Reform Order, 1257; 47 C.F.R. § 54.407(c)(1).
DCOI /SMITD/472719. 7
14
not used their service for 60 days. After 60 days of non-use, Company will provide notice to the
subscriber that failure to use the Lifeline service within a 30-day notice period will result in de-
enrollment. 39 For these purposes, subscribers will be considered to "use" the service by:
(1) completing an outbound; (2) purchasing minutes from Company to add to the subscriber's
plan; (3) answering an incoming call from a party other than Company; or responding to a direct
contact from Company and confirming that the subscriber wants to continue receiving the
service. 40
If the subscriber does not respond to the notice, the subscriber will be de-enrolled
and Company will not request further Lifeline reimbursement for the subscriber. Company will
report annually to the Commission the number of subscribers de-enrolled for non-usage by
month.4t
E. Additional Measures to Prevent Waste, Fraud and Abuse
To supplement its verification and certification procedures, and to better ensure
that customers understand the Lifeline service restrictions with respect to duplicates, the
Company will implement measures and procedures to prevent duplicate Lifeline benefits being
awarded to the same household. These measures entail additional emphasis in written
disclosures as well as live due diligence. 42
In addition to checking the national database when it becomes available,
Company personnel will emphasize the "one Lifeline phone per household" restriction in their
See Lifeline Reform Order, 1257; 47 C.F.R. § 54.405(e)(3). See Cricket Compliance
Plan at 2 (stating that it did not need to implement a non-usage policy because it offered
only plans with unlimited local and long distance calling).
40 See Lifeline Reform Order, 1261; 47 C.F.R. § 54.407(c)(2).
41 See Lifeline Reform Order, 1257; 47 C.F.R. § 54.405(e)(3).
42 See Cricket Compliance Plan at 9.
DCOI/SMITD/472719. 7
15
direct sales contacts with potential customers. 43 Training materials will include a discussion of
the limitation to one Lifeline phone per household, and the need to ensure that the customer is
informed of this restriction.44
Database. When the National Lifeline Accountability Database ("National
Database") becomes available, Company will comply with the requirements of new rule section
54.404. Company will query the National Database to determine whether a prospective
subscriber is currently receiving a Lifeline service from another ETC and whether anyone else
living at the prospective subscriber's residential address is currently receiving Lifeline service. 45
One-Per-Household. Company will implement the requirements of the Lifeline
Reform Order to ensure that it provides only one Lifeline benefit per household 46 through the use
of its application and certification forms discussed above, internal database checks and its
marketing materials discussed below. Upon receiving an application for Company's Lifeline
service, Company will search its own internal records to ensure that it does not already provide
Lifeline-supported service to someone at the same residential address. 47 If it does discover
See Cricket Compliance Plan at 6, 9.
Id.
See Lifeline Reform Order, 1203. Company will also transmit to the National Database
the information required for each new and existing Lifeline subscriber. See Lifeline
Reform Order, ¶11 189-195; 47 C.F.R. § 54.404b)(6). Further, Company will update
each subscriber's information in the National Database within ten business days of any
change, except for de-enrollment, which will be transmitted within one business day. See
47 C.F.R. § 54.404(b)(8),(10).
46 A "household" is any individual or group of individuals who are living together at the
same address as one economic unit. A household may include related and unrelated
persons. An "economic unit" consists of all adult individuals contributing to and sharing
in the income and expenses of a household. An adult is any person eighteen years or
older. If an adult has no or minimal income, and lives with someone who provides
financial support to him/her, both people shall be considered part of the same household.
Children under the age of eighteen living with their parents or guardians are considered to
be part of the same household as their parents or guardians. See Lifeline Reform Order, ¶
74; 47 C.F.R. § 54.400(h).
See Lifeline Reform Order, 178 and See Cricket Compliance Plan at 7.
OCOI /SMITD/472719. 7
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duplicate service at an address, Company will require the applicant to complete and submit a
written USAC document containing the following: (1) an explanation of the Commission's one-
per-household rule; (2) a check box that an applicant can mark to indicate that he or she lives at
an address occupied by multiple households; (3) a space for the applicant to certify that he or she
shares an address with other adults who do not contribute income to the applicant's household
and share in the household's expenses or benefit from the applicant's income, pursuant to the
Commission's definition; and (4) the penalty for a consumer's failure to make the required one-
per-household certification (i.e., de-enrollment).48 Further, if a subscriber provides a temporary
address on his or her application/certification form collected as described above, Company will
verify with the subscriber every 90 days that the subscriber continues to rely on that address.49
Finally, Company personnel will inform each Lifeline applicant that he or she
may be receiving Lifeline support under another name, and will facilitate the applicant's
understanding of what constitutes "Lifeline-supported services." The Company personnel will
also assist the applicant in determining if he or she is already benefiting from Lifeline support,
by identifying the leading Lifeline offerings in the relevant market by brand name. 50
Marketing Materials. Within the deadline provided in the Lifeline Reform Order,
TCM will include the following information regarding its Lifeline service on all marketing
materials describing the service: (1) it is a Lifeline service, 51 (2) Lifeline is a government
assistance program, (3) the service is non-transferable, (4) only eligible consumers may enroll in
the program, (5) the program is limited to one discount per household, consisting of either one
Id.
See Lifeline Reforn? Order, 189.
so See Cricket Compliance Plan at 7.
See Cricket Compliance Plan at 4.
DCOI/SMITD/472719. 7
17
wireline or one wireless service; (6) what documentation is necessary for enrollment;52 (7)
TCM's name as the ETC; and (8) consumers who willfully make a false statement in order to
obtain the Lifeline benefit can be punished by fine or imprisonment or can be barred from the
program. 53 These statements will be included in all print, audio video and web materials
(including social networking media) used to describe or enroll customers in Company's Lifeline
service offering, as well as Company's application forms and certification forms. 14 This
specifically includes Company's website (totalcallmobile.com/lifeline).55 A sample of
Company's Lifeline marketing materials is included as Exhibit E.
F. Company Reimbursements From the Fund
To ensure that the Company does not seek reimbursement from the Fund without
a subscriber's consent, Company will certify, as part of each reimbursement request, that it is in
compliance with all of the Commission's Lifeline rules and, to the extent required, has obtained
valid certification and verification forms from each of the subscribers for whom it is seeking
reimbursement. 56 Company will verify customers as described in the Compliance Plan before
submitting requests for reimbursement for service provided to the subscriber. In addition,
Company will keep accurate records as directed by USAC 57 and as required by new section
54.417 of the Commission's rules.
Further the Company will submit its FCC Forms 497 on the eighth day of each
month in order to be reimbursed the same month, and inform USAC, to the extent necessary, to
52 See Cricket Compliance Plan at 4.
See Lifeline Reform Order, 1275; 47 C.F.R. § 54.405(c).
Id.
Id.
56 See Lifeline Reform Order, ¶ 128; 47 C.F.R. § 54.407(d).
See id.
DCOI/SMJID/47271 9. 7
18
reimburse it for actual claims rather than projected claims over the course of more than one
month.58
G. Annual Company Certifications
Company will submit an annual certification to USAC, signed by a Company
officer under penalty of perjury, that Company: (1) has policies and procedures in place to
review consumers' documentation of income- and program-based eligibility and ensure that its
Lifeline subscribers are eligible to receive Lifeline services;59 (2) is in compliance with all
federal Lifeline certification procedures; 60 and (3) has obtained a valid certification form for each
subscriber for whom the carrier seeks Lifeline reimbursement. 61
In addition, Company will provide the results of its annual re-
certifications/verifications on an annual basis to the Commission, USAC and the applicable state
commission as appropriate. 62 Further, as discussed above, Company will report annually to the
Commission the number of subscribers de-enrolled for non-usage by month .63
The Company will also annually report to the Commission, USAC and relevant
state commissions as appropriate, the company name, names of the company's holding company,
operating companies and affiliates, and any branding (such as a "dba" or brand designation) as
well as relevant universal service identifiers for each entity by Study Area Code .64 Company
will report annually information regarding the terms and conditions of its Lifeline plans for voice
58 See Lifeline Reform Order, 11302-306.
See Lifeline Reform Order, 1126; 47 C.F.R. § 54.416(a)(1).
60 See Lifeline Reform Order, 1127; 47 C.F.R. § 54.416(a)(2).
61 See 47 C.F.R. § 54.4 16(a)(3).
62 See Lifeline Reform Order, ¶11 132,148; 47 C.F.R. § 54.416(b),
63 See Lifeline Reform Order, 1257; 47 C.F.R. § 54.405(e)(3).
See Lifeline Reform Order, 111296, 390; 47 C.F.R. § 54.422(a).
DCO /SM1TD147271 9. 7
ILI
telephony service offered specifically for low income consumers during the previous year,
including the number of minutes provided and whether there are additional charges to the
consumer for service, including minutes of use and/or toll calls. 65 Finally, Company will
annually provide detailed information regarding service outages in the previous year, the number
of complaints received and certification of compliance with applicable service quality standards
and consumer protection rules, as well as a certification that Company is able to function in
emergency situations. 66
H. Cooperation with State and Federal Regulators
The Company will cooperate with federal and state regulators to prevent waste,
fraud and abuse. More specifically, the Company will:
• Make available state-specific subscriber data, including the names and addresses
of Lifeline subscribers, to USAC and to each state public utilities commission
where the Company operates for the purpose of determining whether an existing
Lifeline subscriber receives Lifeline service from another carrier; 67
• Assist the Commission, U SAC, state commissions, and other ETCs in resolving
instances of duplicative enrollment by Lifeline subscribers, including by
providing to USAC and/or any state commission, upon request, the necessary
information to detect and resolve duplicative Lifeline claims;
• Promptly investigate any notification that it receives from the Commission,
USAC, or a state commission to the effect that one of its customers already
receives Lifeline services from another carrier; and
• Immediately de-enroll any subscriber whom the Company has a reasonable basis
to believe68 is receiving Lifeline-supported service from another ETC or is no
longer eligible - whether or not such information is provided by the Commission,
USAC, or a state commission. 69
65 See Lifeline Reform Order, 1390; 47 C.F.R. § 54.422b)(5).
66 See Lifeline Reform Order, 1389; 47 C.F.R. § 54.422(b)(1)-(4).
67 The Company anticipates that the need to provide such information will sunset following
the implementation of the national duplicates database.
68 See 47 C.F.R. § 54.405(e)(1).
69 See Cricket Compliance Plan at 10.
DCOI/SMITD/472719. 7
20
II.DESCRIPTION OF LIFELINE SERVICE OFFERINGS
Company will offer its Lifeline service in the states where it is designated as an
ETC and throughout the coverage area of its underlying provider Sprint. The Company's
Lifeline offering, as described in Exhibit F, will allow customers to choose from the following
options: (1) 150 minutes (including select international destinations as described in Exhibit U)
per month at no charge; (2) 250 minutes (domestic only) per month at no charge; or (3) a
discount off ofTCM's 30-day Unlimited Talk & Text plan or TCM's 30-day Unlimited Talk,
Text, & Data plan. Additional plan details are described on the sample advertisement at Exhibit
E and in Exhibit F. Lifeline customers can also purchase additional bundles of minutes and
service (i.e. if they run out of minutes or if they want to make international calls) by purchasing
TCM's refill cards online, via the customer service line, at a Western Union location, and at
stores that carry TCM prepaid refills.
In addition to free or discounted voice services, Company's Lifeline plan will
include a free handset (with an option to buy an upgrade) and custom calling features at no
charge, including Caller ID and Voicemail. All plans include domestic long-distance at no extra
per minute charge. Calls to customer service and 911 emergency services are always free,
regardless of service activation or availability of minutes.
III.DEMONSTRATION OF FINANCIAl. AND TFCHNICAI. CAPAfflIITWS AND
nj
Financial and Technical Capabilities. Revised Commission rule 54.202(a)(4),47
C.F.R. 54.202(a)(4), requires carriers petitioning for ETC designation to demonstrate financial
70 See Compliance Plan Public Notice at 3.
DCOI /SMITD/472719. 7
and technical capability to comply with the Commission's Lifeline service requirements. 71 The
Compliance Plan Public Notice requires that a carrier's compliance plan also include this
demonstration. Among the factors the Commission will consider are: a carrier's prior offering of
service to non-Lifeline subscribers, the length of time the carrier has been in business, whether
the carrier relies exclusively on Lifeline reimbursement to operate; whether the carrier receives
revenues from other sources and whether the carrier has been the subject of an enforcement
action or ETC revocation proceeding. This section summarizes TCM's financial and technical
capabilities to provide the service.
TCM provides affordable prepaid mobile phone service, including calling and text
messaging, along with ser-friendly handsets and high quality customer service. The majority of
TCM's products and plans are specially geared toward serving lower income communities, and
its service models and pricing plans reflect this mission. TCM offers nationwide non-Lifeline
prepaid services as an MVNO using the Sprint network. In addition, TCM is applying for
certification as an ETC with the FCC (for Alabama, Connecticut, Delaware, the District of
Columbia, Florida, New Hampshire, New York, North Carolina, Tennessee, and Virginia),
Arkansas, California, Louisiana, Michigan, Nevada, and West Virginia. TCM received ETC
approval in Maryland on December 23, 2011.72
TCM is the wholly-owned subsidiary of Total Call International ("TCI"), a
national prepaid telecommunications services provider. TCI provides international prepaid
calling cards, which are often used by low income or unbanked consumers, many of whom are
members of ethnic communities. TCI has been providing telecommunications services to
See Lifeline Reform Order, NN 387-388 (revising Commission rule 54.202(a)(4)).
72 The Arkansas PSC initially granted TCM's application, but on March 22, 2012, the PSC
issued a stay and remand in light of the Lifeline Reform Order.
DCOI/SMITD/472719. 7
22
customers for over 10 years. TCI, in turn, is majority owned by KDDI America, a subsidiary of
Japan's second largest telecommunications carrier (KDDI Corporation). KDDI Corporation and
its affiliates provide mobile services (voice and data) and fixed line services (broadband,
domestic and international telecommunications and data center services) in Japan and globally.
KDDI's technical and financial capabilities are further described in Exhibit A.
TCM will benefit from the experience of its parent entities in its provision of ETC
services. TCM also will benefit from TCI's knowledge of low income markets when conducting
outreach to eligible consumers. During the past 10 years, TCM and TO have provided
I telecommunications services to non-Lifeline customers and, consequently, TCM has not and will
not be relying exclusively on Lifeline reimbursement for the Company's operating revenues.
TCM receives revenues from these prepaid wireless services and also has access to the financial
resources of its parent company. The Company has not been the subject of any enforcement
actions by the FCC nor has it been subject to any ETC revocation proceedings.
Service Requirements Applicable to Company's Support. The Compliance Plan
Public Notice requires carriers to include "certifications required under newly amended section
54.202 of the Commission's rules."73 Company certifies that it will comply with the service
requirements applicable to the support the Company receives. 74 TCM provides all of the
telecommunications service supported by the Lifeline program and will make the services
available to all qualified consumers throughout the states in which it is designated as an ETC.75
TCM's services include voice telephony services that provide voice grade access to the public
Compliance Plan Public Notice at 3.
47 C.F.R. § 54.202(a)(1).
In addition to voice telephony services, 1CM' s services include the nine features, i.e.,
dual tone multi-frequency signaling, single party service and access to operator services,
etc. previously identified in Commission rule 54.101(a).
DCOI /SMITD/4727 19. 7
23
switched network or its functional equivalent. Further, TCM's service offerings provide its
customers with minutes of use for local service at no charge to the customer. The Company will
offer a set number of minutes of local exchange service free of charge to its subscribers and will
abide by any Commission-required minimum usage amounts. TCM's Lifeline offering will
allow customers to choose from the following options: (1) 150 minutes (including select
international destinations as described in Exhibit G) per month at no charge; (2) 250 minutes
(domestic only) per month at no charge; or (3) a discount off of TCM's 30-day Unlimited Talk &
Text plan or TCM's 30-day Unlimited Talk, Text, & Data plan. Additional plan details are
described on the sample advertisement attached as E and in F. Lifeline customers can also
purchase additional bundles of minutes and service (i.e. if they run out of minutes or if they want
to make international calls) by purchasing TCM's refill cards online, via the customer service
line, at a Western Union location, and at stores that carry TCM prepaid refills.
The Company also will provide access to emergency services provided by local
government or public safety officials, including 911 and E911 where available and will comply
with any Commission requirements regarding E91 1-compatible handsets. As discussed above,
TCM will comply with the Commission's forbearance grant conditions relating to the provision
of 911 and E91 I services and handsets.
Finally, toll limitation services do not apply because TCM, like most wireless
carriers, does not differentiate domestic long distance toll usage from local usage and all usage is
paid for in advance. Pursuant to the Lifeline Reform Order, subscribers to such services are not
considered to have voluntarily elected to receive TLS.76
76 See Lifeline Reform Order, 1230.
DCOI/SMITD/472719. 7
24
IV. CONCLUSION
TCM submits that its Compliance Plan fully satisfies the conditions set forth in
I

the Commission's Lifeline Reform Order, the Compliance Plan Public Notice and the Lifeline
rules. Accordingly, the Company respectfully requests that the Commission expeditiously
approve its Compliance Plan.
Respectfully submitted,
A, A-4-
Steven A. Augustino
Denise N. Smith
Kelley Drye & Warren, LLP
3050 K Street, NW
Suite 400
Washington, D.C. 20007
[phone]
Counsel to Total Call Mobile, Inc.
May 14,2012
DCOI/SMITD/472719, 7
25
EXHIBIT A
KDDI Corporation
Financial Statements and Management Biographies
Tadashi Onodera I Executive Members I KDDI CORPORATION Page I of)
Thç
rpo;3t nt(rmn.tion
Management Policy
Tadashi Onodera
Dec. 2010 Chairman
Jun. 2005 President and Chairman
Jun. 2001 President
Jun. 1997 Executive Vice President, Member of the Board
Jun. 1995 Associate Senior Vice President, Member of the Board
Jun. 1989 Member of the Board
Tadashi Ortodera
Chairman
[Date of Birth]
February 3, 1948
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HOME > Corporate Information> Investor Rerations> Management Policy> Executive Members > Tadashi Onodera
COPYRIGHT © KDDI CORPORATION, ALL RIGHTS RESERVED.
Kanichjro Aritomj I Executive Members I KDDI CORPORATION Page) of I
Management Policy
Kanichiro Aritorni
Jun. 2010 Vice Chairman
Aug. 2009 Special Adviser
Jul. 2007 President, the Foundation for MultiMedia Communications
Kanichiro Aritomi
Vice Chairman
[Date of Birth]
October 12, 1947
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HOME > Corporate Information> Investor Rerations > Management Policy > Executive Members> Kanichiro Aritomi
COPYRIGHT C) KODI CORPORATION, ALL RIGHTS RESERVED.
Takashi Tanaka I Executive Members I KDDI CORPORATION Page 1 of I
;)rrT-t::ii
Management Policy
Takash Tanaka
Dec.2010 President
Jun 2010 Senior Vice President Solution Business Consumer Business and
Product Development Sector Member of the Board
Apr. 2010 Associate Senior Vice President Solution Business Consumer
Business, and Product Development Sector, Member of the Board
Jun. 2007 Associate Senior Vice President, General Manager, Solution Business
Sector, Member of the Board
Takashi Tanaka
President
[Date of Birth)
February 26, 1957
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HOME > Corporate Information> Investor Rerations> Management Policy> Executive Members > Takashi Tanaka
COPYRIGHT © KDDI CORPORATION, ALL RIGHTS RESERVED.
Hirofuini Morozumj I Executive Members I KDDI CORPORATION Page 1 of I
suiç Ihr
AWN
L
Management Policy
Hirofumi Morozum
Jun. 2010 Executive Vice President, General Manager, Corporate Sector, ._.. . ...
Member of the Board Return to Executive M
• Apr, 2010 Senior Vice President, General Manager Corporate Sector, Member of
the Board Stock Quotes (20 ri
Mar. 2010 Director of Jupiter Telecommunications Co., Ltd.
TS Jun. 2007 Senior Vice President, Corporate Administration and Human
Resources, Corporate Strategy. Member of the Board Last 599OOO
Hirofumi Morozumi Jun. 2003 Associate Senior Vice President, Member of the Board Change -5OOO
Executive Vice President . . -.
Apr. 2003 Associate Senior Vice President Member of the Board V
Jun. 2001 Vice President
,
,
-.
[Date of Birth) Jun. 1995 Member of the Board t.br/12 çrfl2 M
May 2, 1956
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HOME > Corporate Information> Investor Rerations> Management Policy > Executive Members > Hirofumi Morozumi
COPYRIGHT © KDDI CORPORATION, ALL RIGHTS RESERVED.
Makoto Takahashi 1 Executive Members I KDDI CORPORATION Page 1 of I
r•n Tf
i( r.t1{
Management Policy
Makoto Takahashi
• Apr. 2011 Senior Vice President, General Manager, Business Development
Sector, Member of the Board
Jun. 2010 Senior Vice President, General Manager, Group Strategy Sector,
Member of the Board
Apr. 2010 Associate Senior Vice President, General Manager, Group Strategy
Sector, Member of the Board
Mar. 2010 Director of Jupiter Telecommunications Co., Ltd.
Makoto Takahashi Jun. 2007 Associate Senior Vice President, General Manager, Consumer
Senior Vice President Business Sector, Member of the Board
Member of the Board
[Date of Birth]
October 24, 1961
RM
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HOME> Corporate Information> Investor Rerations> Management Policy> Executive Members > Makoto Takahashi
COPYRIGHT KDDI CORPORATION, ALL RIGHTS RESERVED.
Yoshiharu Shimatani I Executive Members I KDDI CORPORATION Page 1 of I
Management Policy
Yoshiharu Shirnatani
Jun. 2011 Senior Vice President, General Manager, Technology Sector, Member
of the Board
Apr. 2010 Associate Senior Vice President, General Manager, Technology A Sector, Member of the Board
Jun. 2009 Associate Senior Vice President, Technology Officer, Member of the
Board
Yoshiharu Shirnatani
Senior Vice President
Member of the Board
(Date of Birth)
October 28, 1950
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HOME > Corporate Information> Investor Rerations> Management Policy> Executive Members> Yoshiharu Shimatani
COPYRIGHT 0 KDDI CORPORATION, ALL RIGHTS RESERVED.
Yuzo Ishikawa I Executive Members I KDDI CORPORATION Page II of]
Yb.• i,w
(j
Management Policy
Yuzo Ishikawa
,.. .IL..... r, f',.,,... ,,.-,, D. Q,b,+;,.,.,
Vuzo Ishikawa
Senior Vice President
Member of the Board
[Date of Birth]
October 19, 1956
npi. IV II '.?tI hUm vite rItbluchu,.,e L,,uI Iuhl IC,. , L) UOII coo, ..flJIIJLUI I
Business and Product Sector,Member of the Board
Oct. 2011 Senior Vice President, Consumer Business, Business Development,
Solution Business,Global Business and Product Sector,Member of the
Board
Jun. 2011 Senior Vice President, Consumer Business, Solution Business, Global
Business and Product Sector, Member of the Board
Jun, 2010 Associate Senior Vice President, General Manager, Solution Business
Sector, Member of the Board
Jun. 2001 Vice President
Jun. 2000 Member of the Board
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HOME> Corporate Information> Investor Rerations > Management Policy> Executive Members > Yuo Ishikawa
COPYRIGHT © KDDI CORPORATION, ALL RIGHTS RESERVED.
Masahiro lnoue I Executive Members 1 KDDI CORPORATION Page 1 of I
c4? 7I'
1(Jri'F
Management Policy
Masahiro Inoue Am_____
FOU
Apr. 2011 Associate Senior Vice President, Associate General Manager, L—!.- iF
Technology Sector, (Engineerning and Operations), Member of the Return to Executive M
Board
Jun. 2010 Associate Senior Vice President, General Manager, Mobile
Technology Sector, Member of the Board
Masahiro Inoue
Associate Senior Vice
President
Member of the Board
[Date of Birth]
November 7, 1952
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HOME > Corporate Information > Investor Relations> Management Policy> Executive Members> Masahiro Inoue
COPYRIGHT © KDDI CORPORATION ALL RIGHTS RESERVED.
Hideo Yuasa I Executive Members KDDI CORPORATION Page 1 of I
Management Policy
Hideo Yuasa
A.-... ')r%4 I D;l,-..4 f'LJI II I TEN AAI IMI('ArIrrI t'(\ Itd(' man'-, )) rI. L'J I I F IOCIUCI It, '..fl ILIIJ'J I LL.¼J¼JIVIVItJu1I'..,fl I'.,,' Sfl.J.,
Jun. 2010 Associate Senior Vice President, General Manager, Consumer
Business Sector, Member of the Board
Apr. 2010 Vice President, General Manager, Consumer Business Sector
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Hideo Vuasa
Associate Senior Vice
President
Member of the Board
[Date of Birth]
August 3, 1955
HOME > Corporate Information > Investor RerOtions> Management Policy> Executive Members > Hideo Vuasa
COPYRIGHT © KDDI CORPORATION, ALL RIGHTS RESERVED.
Hiromu Naralani I Executive Members I KDDI CORPORATION Page 1 of 1
Management Policy
Hirornu Naratan
tt
Apr. 2011 Associate Senior Vice President, General Manager, Corporate
Communications Sector, Member of the Board
Jun. 2010 Associate Senior Vice President, General Manager, Corporate
Communications & Marketing Sector, Member of the Board
- Apr. 2010

Vice President, General Manager, Corporate Communications &
Marketing Sector
Hiromu Naratani
Associate Senior Vice
President
Member of the Board
[Date of Birth]
February 6, 1952
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HOME> Corporate Information > Investor Rerations> Management Policy> Executive Members ' 1-liromu Naratani
COPYRIGHT KDOI CORPORATION, ALL RIGHTS RESERVED.
E sns1 nIJtobe used solely as a reference and the consolidated financial statements in this release are unaudited. I
Financial Slatenients Summary for the Year ended March 31, 2012 [Japan GAAPJ
L'ornpaiw Name KOD! CORPORATION April 25, 2012
Stock Listing Tokyo Stock Exchange-First Section Code No. 9433
Representative Takashi Tanaka. President IJRL htto:/Rvww.kddLcom
Scheduled dale for annual meeting of shareholders Julie 20, 2012
Scheduled date for filing of full-year report June 21, 2012
Scheduled date fir dividend payment June 21, 2012
Earnings supplementary explanatory documents for the fiscal year: Yes
Earnings presentation for the fiscal year: Yes (for institutional investors and analysis)
(Amount unit: Millions of yen, unless otherwise slated)
(Amounts are rounded down to nearest million yea)
I. Consolidated Financial Results for the Year ended March 31, 2012 (April 1, 2011 - March 31, 2012)
(I) Consolidated Results of Operation ,n,ei,nnehenne in Ike .'nr, onodina nrevi000 Omal enar"-
Operating Revenues Operating Income Ordinary Income Net Income
Year ended March 31, 2012 35721098 4.0 477,647 1.2 451,178 2.4 238,604 (6.5)
Year ended March 31, 2011 3,434.545 (0.2)f 471,911 6.3 440,676 4.2 255,122 19.9
INOIC) Cansolluarea WRICITICIVIS 01 Comprehensive Income
Year ended March 31. 2012 : 249.510 million yen: (O 5W Year ended March 31 2011 250.829 million yea: 6.1%
Net Incom per Share
I I Diluted Net Income
I
j Return on
I I Return on
I I I Operating Income I per Share Equity Assets Margin I
Yea I Yen I I I
Year ended March 31, 2012 1 58,115.98 I 56.668,91 I 11.5 I 11.6 I 134
.Year ended March 3t,201l 58,149.78 - j 12.4 11.6 13.7 I
5lcelerence) tctui'y In net income Olatlll,ateO Yost ended March 31, 2012: (18,297) million yen/Year ended March 31, 2011: (19.948) million yen
(2)Consolidated Financial Position
I 1 otal Assets i Net Assets . . Equtty Ratio Total Net Assets
per Share
Yen
As of March 31, 2012 4.0042009 2,128,624 51.5 539,206.73
As of March 31, 2011 3,778,918 2,171,839 5 5. 7 495,386.23
s"nin.c) CiolOOl .tiy ms iii maceli ., 1,1012 : 1,utiu, /o miiiion VOflhF%S 01 mirca 11,2011 : 2,02.22 I iiiIiilOfl yen
(3)Consolidated Cash Flows
Cash Flows from Cash Flows from Cash Flows from Cash and Cash I
--__. Operating Activities Investing Activities Financing Activities Equivalents
Year ended Moich 31.2012 I 725,886 (484,507) (225,931) 174,191
Yea, ended March 31, 2011 717353 (440,545) (279,998) 159,869
2.Dividends
Dividends per Share Total 0 Ratio of
I °Qua,iei 21 Quarter 3" Quarter Fiscal Year Total Dividends for Payout
Ratio
Dividends to
Shareholders' End End End End the Year
--Equity
Yen Yen Yen Veil Yen
Year ended Maccl, 31,2011 - 6500.00 - 7,500.00 14,000.00 60,795 24.1 3.0
Year ended March 31, 2012 - 7,500.00 - 8500.00 16,000.00 64,328 27.5 3.1
Yc'irendiit>,March ul 0I2 8 50000 8,500.00 17 00000 260
3.Consolidated Financial Results Forecast for the Year ending March 31, 2013 (April 1. 2012 - March 31, 2013)
,.,rnnInnrn,,in,,,
Operating Revenues Operating Income Ordinary Income Net laconic Net Income
per Share
%I v,I Yell
[lirc Fiscal Year 3.580,000 0.2 500,000 4.7 ) 490,000 8.6 250,000 4.8 64 14.00
I. roiecast 01 consoIIUals'rl business results Fr the six months coding September 30"N Is not prepared
2.

Net income per share in Ike consolidated financial resells forecasts for the year ending March 31, 2013 does not take the stock split into account.
For fiurihet information, please see "Explauinlion for Appropriate Use of Forecasis and Oilier Notes."
4. Oilier
(I) Changes in significant consolidated subsidiaries (which resulted in changes in scope of consolidation): None
(2) Changes in accounting policies, accounting estimates and restatement of corrections
I) Changes in accounting policies resulting from the revision of the accounting standards and other
regulations: Yes
2)Oilier changes in accounting policies: None
3)ChittgcS in accounting estimates: Yes
4)Restatement of corrections: None
Note: Please refer to page 25 "Basis of Presenting Consolidated Financial Statements" and page 28
"Changes in Significant Accounting Policies" and "Changes in Accounting Estimates" for details.
(3) Numbers of Outstanding Shares (common shares)
I) Number of shares outstanding (inclusive of treasury stock) As of March 31, 2012 4,484,818

As of March31, 2011 4.484,818
2)Number of treasury stock As of March 31, 2012 663.006

As of March 31, 2011 238.976
3)Number of weighted average common shares For the year ended March 31, 2012 4,105,665
outstanding (cumulative for all quarters) For the year ended March 3 I t 2011 4.387,331
(Amount unit: Millions of sea, unless otherwise stared)
(Amounts are rounded down to nearest million yen)
(Reference) Summary of KDDI Corporation's Financial Results and Financial Position
I. KDDI Corporation's Financial Results for the War ended March 31,2012 (April 1, 2011 - March 31. 2012)
(1)KDDI Corporation's Results of Operation
•Pcrcentaee represents comparison change to the corresponding previous fiscal year"
Operating Revenues Operating Income - Ordinary Income Net Income
Year ended March 3), 2012 3,273,536 4,3 4322440 1.0 434,575 2.8 249,836 (2.7)
Year ended March 31, 2011 3.138.742 (2.3) [ 428,269 3.4 422.929 3.0 256,823 19.6
Net Income per Share I Diluted Net I
Income per Share
Yen

I yen
Year ended March 31, 2012 60,851.69 59,337.05 I
Year ended March 3 1, 2011 58,537.60 . I
(2)KDDI Corporation's Financial Position
Total Assets Net Assets Equity Ratio I Total Net Assets
per Share I % I I Veal
As of March 31, 2012 3,851,891 2,064,847 53.6 540,008.17
As of March 31, 2011 3,644,330 2,092,818 57.4 492,577.91 I
,Reference) Shareholder's Equity As of March 31,2012: 2,063,809 million yen As ofMsrch 31,2011: 2,091,407 million yell
Indication of audit procedure implementation status
This earnings report is exempt from audit procedure based upon the Financial Insiruments and Exchange Act. It is
under the audit procedure process at the time of disclosure of this report.
Explanation for Appropriate Use of Forecasts and Other Notes
1.Forecast of Results
The forward-looking statements such as operational forecasts contained in this statements summary are based on
the information currently available to KDDI corporation (hereafter: the "Company") and certain assumptions
which are regarded as legitimate. Actual results may differ significantly from these forecasts due to various
Factors. Please refer to page 8 "Outlook for the Year ending March 31, 2013" under 'the Attachment" for the
assumptions used and oilier notes.
2.Forecasts for financial results and dividends oiler the stock split
The Company resolved at it meeting of the Board of Directors held on April 25, 2012, that the common stock will
he split 100 for I. and the trading unit of the stock will he 100 shares with an cfl'cctive date of October 1. 2012.
Accompanying this changel the forecasts for financial results and dividends in the fiscal year ending March 31,
2013 areas follows.
(I) Consolidated Business Results Forecast for the Year ending March 31, 2013
Year ending March 31, 2013 654.14
(2) Dividends forecast for the Year ending March 31, 2013
Six months ending September 30, 2012 81500•00N0t,t
Year ending March 31. 2013 Y85,00Nm02
Note 1: Interim dividends will be paid on the basis of tire number of shares prior to the implementation of tIre stock split.
Note 2: Dividends after the implementation of the stock split, if adjusted to reflect the number of shares prior to the stock
split, will be equivalent to Y18.500.00 per share.
[the Attachment]
Qualitative Information / Financial Statements, etc 2
(I) Analysis on Consolidated Operating Results • 2
(2) Analysis on Consolidated Financial Position .............................................................................................. 9
(3) Profit Distribution ............................................................................................................................................... 10
(4) Business Risks ..................................................................................................................................................... 10
2. The Group ................................................................................................................................................................... 11
3. Management Policy ...................................................................................................................................................... 13
()) Basic Management policies .................................................................................................................................. 13
(2) Medium-to Long-term Management Strategy, Target Management Indicators, and Important Issues .................... 13
4. Consolidated Financial Statements ................................................................................................................................ 15
(1) Consolidated Balance Sheets ................................................................................................................................. 15
(2) Consolidated Statements of (Comprehensive) Income ........................................................................................... 18
Consolidated Statements of Income ....................................................................................................................... 18
Consolidated Statements of Comprehensive Income ............................................................................................. 20
(3) Consolidated Statements of Changes in Net Assets ............................................................................................... 21
(4) Consolidated Statements of Cash Flows ................................................................................................................ 23
(5) Going Concern Assumption .................................................................................................................................. 25
(6) Basis of Presenting Consolidated Financial Statements ......................................................................................... 25
(7) Changes in Accounting Policies ............................................................................................................................ 28
(8) Changes in Presentation ........................................................................................................................................ 28
(9) Changes in Accounting Estimates ......................................................................................................................... 28
(1(t) Additional Information .......................................................................................................................................... 28
(11) Notes for Consolidated Financial Statements ........................................................................................................ 29
(Consolidated Balance Sheets) ............................................................................................................................ 29
(Consolidated Statements of Income) .................................................................................................................... 31
(Consolidated Statements of Comprehensive Income) ........................................................................................... 33
(Consolidated Statements of Changes in Net Assets) ............................................................................................. 34
(Consolidated Statements of Cash Flows) ............................................................................................................. 36
(Segment Information) .......................................................................................................................................... 37
(Lease Payment) .................................................................................................................................................... 40
(Related Party Transaction) .................................................................................................................................. 4)
(Income Taaes) .................................................................................................................................................... 42
(Financial Instruments) ......................................................................................................................................... 43
(Securities) ........................................................................................................................................................... 47
(Derivatives) .................................................................................................................................................. 49
(Stock Options) ..................................................................................................................................................... 50
(Business Combination) ....................................................................................................................................... 54
(Asset Retirement Obligations) ............................................................................................................................. 55
(Estate Leases) ..................................................................................................................................................... $5
(Per Share Information) ......................................................................................................................................... 56
(Significant Subsequent Event) ............................................................................................................................. 57
5. Financial Statements .................................................................................................................................................. 58
(I) Balance Sheets ..................................................................................................................................................... 58
(2)Statements of Income ........................................................................................................................................... 62
(3)Statements of Changes in Net Assets .................................................................................................................... 64
a The Company holds an earnings presentation for investors as below. l)ocumcnts distributed at the presentation are scheduled
to be posted on our website at the same time as the release of the financial statements summary. Videos and main Q&As are
planned to be posted immediately afler the presentation.
- Wednesday, April 25, 2012- Earnings presentation for institutional investors and analysts
In addition to the above carnittgs presentation, the Company holds conferences on its business and results for individual
investors. Please check our website for the schedule and details.
L..Qual i tative I niormati oi / Financial Stafemen ts, etc.
(1) Analysis on Consolidated Operating Resuls
I. Resulls Overview
(Amount unit: Millions of vent
Increase
Year ended Year ended increase (Decrease)
March 31 2011 March 33. 2012 (Decrease)
Operating Revenues 3,434.545 3,572,098 337.552 4.0
L0peratie Expenses 2,962,634 3,094,450 131815 4.4
Operating income 473,911 477,647 5,736 3.2
Income (33,234) (26,469) 4,765
Ordinary Income 440,676 451,178 30,501 2.4
Extraordinary Profit (Loss) (95.436) 3,241 98.658
Income before Income
Taxes and Minority 345,259 454,419 309,159 31.6
Interests
[Income Taxes 81,237 207,5601 3262323 155.5
Income before Minority 264,022 246,858 (17,163) (6.5) Interests
Minority Interests 8,900 8,254 (646) (7.3)
Net Income 255.322 238,604 (16,537) (65)
Operating revenues for the year ended March 31, 2032 amounted to V-3,572,099 million 4.0% increase year on yir,
mainly due to the increase in revenues brought by the inerL'Ise in the number of terminal sales in the Mobile Business and
the increase in revenues of Lroup companies in the Fixed -line Business, despite the decline in voice ARPU (Average
Revenue per Unit) in the Mobile Business
In profits, the decline the Mobile Business was offset by the substantial gain in the Fixed-line Business. Operating income
was up 1.2% tear on year to WA77,647 million and ordinary income was up 2.4% year on year to 451 378 million In
extraordinary income and loss there was a substantial improement due to a decline in impairment losses and a reversal of
the provision for loss on the Great East Japan Earthquake. Hossever, corporate taxes for the year ended March 31 2013
declined due to a loss on liquidation of four intermediary holding companies that possessed shares of Jupiter
Telecommunications Co.,ltd In addition, in the fiscal year under reviev, income taxes increased due to the reversal of
deferred tax assets accompanying t reduction in the corporation tax rate As a result net income was down 6.5% year on
year to Y238,604 million.
Overview of Economic Conditions
I he debt problems in Europe continue In be a major risk factor for the global economy, and in the Eui'o zone the
unemployment Talc is rising and banks are reluctant 30 lend In addition countries are stepping tip budget cuts. As a
t'esult. the pace of the recovery in the global economy is clearly deceicraling. On the other hand, in the U.S., the
employment environment has improved, and monctatv casing measures are gradually taking effect. Business
conditions are expected to (oHms a moderate recovery trend Also in emerging economics, business conditions
seem to be steadily improving as concerns about inflation subside, monetary easing measures take effect, and
internal demand increases.
In Japan, the economy has not been expanding, but moving ibrwai'd a moderate recovery is expected to continue
for sonic nic with support from reconstruction -related demand and a range of policy measures, such as subsidies
for envitonmenlally-l'riendly ears. Nonetheless, issues requiring ongoing 'attention include downside risks in the
ecotiomy, such as electricity shortages and increases in the price of crude oil, as well as trends in the global
economy.
Industry Trends
In the mobile communications market, competition for customers is intensifying as pricing plans become more
alThi'dnble; the use nfsrnartphones increases; the range of tablets and other devices diversifies; and content services
expand. centered on music, videos, and ebooks. In the fixed-line communications market, progress is being made
by services combining fixed-line and mobile and by the integration of telecommunicalions and broadcasting. As a
result, competition between services is entering a new phase.
KDDI's Position
'I'hc Company steadily implemented its medium to long term strategies-the 3M Strategy and the Global
Strategy-targeting the realization of' the three business vision: "More Connected'* "More Diverse Values"
"More Global." 3M stands for Multi-network, Multi-device, and Multi-tise. Our growth strategy calls for the
establishment of an environment that seamlcsshy provides a variety of content and services to customers
2-
through an optimal network that can be used anytime and anywhere. with a variety of devices. including
smariphones and tablets.
In January 2012. we announced the Smart Passport Concept. which is phase I of the 3M strategy. This concept
has three key factors, The first is au Smarivalije." an FMC discount service that we offer in cooperation with
FTT1]fc,vrv companies. The second is "ito Smart Pass." which offers packages ot' more than 500 applications
and cloud services. The third is "au II)." which enables the seamless use of those services on multiple devices.
The Smart Passport Concept is aimed at maximizing Value ARPU by expanding FT]Jl sales, targeting
smartphone subscriptions through linked acquisition in the household. and promoting the use of cloud-based
content services. In the future, the Company will further advance the Smart Passport Concept, and in
accordance with a new slogan—New Freedom.—we will provide customers with new value that realizes 3M.
In the Mobile Business, we have implemented a variety of initiatives to expand our customer base. We
strengthened our lineup of handsets, including smartphone models not available from other companies. We also
took steps to enhance ow 'ipplications and content such as establishing a cooperation agreement with raebook
Inc and strengthening ow LISMO service. Additionally, to respond to rapidly growing data traffic, we
bolstered our network by expanding the"au Wi r'i SPOT public wireless LAN service. We also began to
provide the Wi Fi HOME SPOT (CUBE) a router for use in the home and we introduced CV DO
Advanced** to increase communications quality in congested areas In this way.. we continued to focus on both
strengthening our network and reducing our costs.
In theFixed-line Business we worked to expand access lines centered on! TTH services. For corporate clients
we strove to reinforce our ability to support corporate clients international bustncss development by making
effective use of our overseas locations. We also took steps 10 enhance our solutions services.
In both businesses, we sought to forge partnerships with numerous companies in a variety of fields.
2. Results by Business Segment
Note I: Results Summary
IA...,.........,,.• i,A.11,,'..., 'i'
Year ended
March 31, 2011
Year ended
March 31, 2012
Increase
(Decrease)
Increase
(Decrease) %
Mobile Business
Operating revenues
Operating expenses
2,590,724
2.151,838
2,727,012
2.307,821
136,287
155,982
5.3
7.2
- Operating income 438,885 419,190 (19.695)
Fixed-tine Business
Operating revenues
Operating expenses
897,251
873,262
915.536
862,104
182284
(11,157)
2.0
(1.3)
Operating income 23,989 53,431 29,442 122.7
Other Business
Operating revenues
Operating expenses
114,326
105,797
106,873
102,575
(7,452)
(3,222)
(6.5)
1 (3.0)
- Operating income 81 529 4,298 (4.230) (49.6)
Note 2: Subscrimtinns of M,inr Srii,pq It I,,ii Ti,nn,,,,,d ii,,,t
As of March 31,
2011
As of March 31,
2012
- Increase
(Decrease)
Increase
(Decrcase) %
an' 32.999 35,109 2,110 6.4
CDMA IX WIN 29,633 33539 3,906 13.2
(Ref.) UQ WIMAX 807 2.266 1,459 180.8
F171-1 1,901 2168 367 19.3
Mctal-phis 2,543 2,189 (354) (13.9)
Cable-plus phone 1,341 2,074 733 54.7
CATV2 1,088 1,142 54 5.0
Fixed acccss linest 6,407 7,118 711 11.1
Notes: I. Inclusive of module-type contracts
2.Inclusive of wholesales to "i:COM PHONE Plus' from the fiscal year ending March 31, 2012
3.Number of households with at least one contract via broadcasting, internet, or telephone
4.Total access lines of FTTH, direct-revenue telephony (Meial-plus, Cable-plus phone), and CATV subs,
excluding crossover.
.3.
.Mobile Business
Operating revenues for the year ended March 31. 2012 amounted to V2,727,012 million, 5.3% increase year
on "ear. Contributing factors include the increase in revenue brought by the increase in the number of terminal
sales. despite the decline in voice ARPIJ caused by the uptake of the Maitsiuki Discount (Monthly discount)
and Simple Course. Operating income amounted .\4 19,190 million, down 4.5% year on year. due to the
increase in handsets procurement cost that led the rise in operating expenses.
<Overall>
• The number of"au" mobile phone subscriptions was 35.109 million as of March 31, 2012.
• On January 16. 2012, in conlunction with the rollout of the new cu slogan —New Freedom. —we
introduced a new all brand mark.
• On March 1, 2012, we began to offir au Smart Pass and au Smarivalue.
"au Smart Pass" offers unlimited use of more than 500 applications as well as coupon and point services,
storage of photos and videos, and security and supporl, all for V390 per month (including tax). Everyone,
luoma experienced smamtphone users to beginners, can securely and Imiciv enjoy their favorite applications
and services with "nu Smart Pass." and by March 27 the number of members had surpassed 500,000.
au Srnartvaluif is a service that combines mobile and fixed-line communications. With a subscription to
a designated fixed line communications service ice (F r Fl I CAT V), customers can receive a discount of
\1,480 (tax included)* oil their monthly smartphone usage charges for up to two years. This service is
available to subscribers to a designated fixed-line communications service and their family members who
reside in the same household. * flIer 2 years, the discount will be 980.
• Accompanying the reorganization of tile 800MHz bandwidth, which is used by au mobile phones, the
provision of service for models that are not compatible with the new 800MHz bandwidth will end on July
22, 2012. Special options have been made available to eligible customers who upgrade their handsets,
such as special prices, including models that are eligible for free upgrades. We have also continued to
implement activities to publicize this issue. As a result, we have made favorable progress in encouraging
customers to upgrade.
<Mobile Terminals>
• On October II, 2011, the Companies began offering the "iPhone 4S" (made by Apple Inc.). You can use
iPhone 4S on the Companies' 30 network, so you can enjoy the incredible features ofiPhone4S
anywhere, anytime.
• We launched a total of 24 new AndroidTM sntartphones. These included the 1NFOBAR series as well as
high-speed communications models with VI MAX and tethering. capability and waterproof models.
• In feature phones, Ave launched 13 new models. These included models that can be easily used even by
people who are not skilled in the use of mechanical devices and waterproof models that feature a
sophisticated design and a focus on ease of use.
• We also launched a total of 8 other communications devices (tablets, mobile Wi-Fi routers, etc.).
• In handset accessories, in collaboration with "NAVA." a leading Italian stationery maker, in October 2011
we began sales of"iida & NAVA" smartphone accessories. In January 2012, we launched the"au -F I
collection" of official nu accessories, which features a large number of items, centered on original
products available only from au. The "au +1 collection" will be available at au shops, and aim points can he
used for payment.
<Products released for the year ended March 31, 2012>
iPhone "iPhone 4S"
Smartphones 'INFO13AR AOl," "INFOBAR COl," "GALAXY S II WiMAX
IS Series ISW II SC." "OptimusX ISI 1 LG,' "MOTOROLA PHOTON
ISWI IM," 1)IGNO ISWI 1K.' etc.
"Windows Phone lS127"
Feature phones au "Simple Phone K010,** "Mi-Look,' "IJRBANO AFFARE"
Other communication devices :'MOTOROLA XOOMIM Wi-Fi TBi1 IM." "PHOTO-U2 SP03,"
"Wi-Fi WALKER DATAOSW." "ETI3WI IAA"
Accessories INFOBAR "Accessories for INFOBAR AOl/COl"
Collaboration tuda & NA\'A series with _brands
Others "nu 4 I collection' series
.4.
<Pricing Plans>
• On September 1. 2011. we began providing two new au mobile phone pricing plans, 'Plan W simple' and
"Plan W." for customers who place frequent international calls. In addition, we made calls inside Japan
between nu mobile phones lice of charge (eseept between 9pm and )am) and made all C-mail within
Japan free of charge. the first time this has been done for an mobile phones.
On the same day, the Companies made it possible to place intcrnaiional calls from nu mobile phones by
dialing the "010" prefix.
• The Companies launched a new pricing plan. "Plan Z Simple," on September 28, 2011 "Plan Z Simple"
allows users in Japan to call other au mobile phones within Japan for free between the hours of lam and
9pm for a basic monthly rate of-Y-980 (including tax)*. Also, domestic C-mail messages between an
mobile phone users are always free. 24 hours a day.
* Under "Everybody Discount - contract
• On December I, 2011. the Companies began to oiler "WIN Single Flat WiMAX (Simple)," a new rote
plan that can be used with a downlink speed of up to 40Mbps. In addition to the conventional 30 wide
service areas, this service can also he used in WiMAX service areas. If customers subscribe to this service
when purchasing a compatible device (DATAOSW. DATAO1), they are eligible for the "WIN Single Flat
Cost-Saving Discount," under which the service is available for 4,4I0 per month (tax included)* for up
to 25 months.
When applying for "Everybody Discount Single" or "WIN Single Set Discount."
<Consumer Services>
• We began to oiler the "Guarantee Security Pack," which provides total security and safety support for
Android TM sniaitpbones on November 18 2011 In this way, we provide a package of services remote
locking in the event a smaitphone is lost Virus Buster Mobile for au, " which protects handsets from
harmful sites and applications and Remote Support which offers jeote operation and setting by
operators. We are the first domestic mobile telecommunications company to introduce remote support for
A ndroidTM smartphones.
• From March 1. 2012, we significantly improved the existing an mobile phone point service, the "an Point
Program." Through this upgrade, we have expanded the ways in which members can use points earned
under the "au Point Program." For example, points can be used to make purchases of goods from a variety
of shopping sites or content. In addition, we changed the requirements for earning points.
<Corporate Services>
• The Company entered a business alliance with I3randdialog, Inc.. on August 2. 2011, to launch the "KDDI
Knowledge Suite As the Company's fist service for its pioplietr) KDDI MULTI CLOUD € service
the "KDDI Knowledge Suite" is a highly convenient business application that links groupware with sales
support and customer management, which enables workers to operate more efficiently by allowing them
to use schedules and telephone memos even when away from their desks.
• On November 22, 2011, we began to offer "KDDI 3LM Security," a security management service
developed by Three Laws of Mobility, Inc. This service, which is available for corporate customers using
an Android devices, features robust security functions that were not previously available at the
application level.
<Others>
• The Companies launched the "an Wi-Fi SPOT' public wireless LAN service on June 30, 2011, and by the
end of March 2012, the number of spots available with this service had surpassed 100,000.
Customers who subscribe to the "IS Flat" or to "Plan F (IS) Simple/Plan F (IS)" can use this service from
au smartphones at no additional charge, and this service is used by a large number of customers. We have
implemented a variety of measures to increase convenience for our customers. We are providing services
in cooperation with convenience stoles for the distribution of a wide range of information and content. We
have also enhanced service to enablc the usc of another Wi-Fi compatible device in addition to the
smariphone, such as a PC or a tablet, at no charge. In addition, we have taken steps to expand our
coverage area in Japan and include such locations as moving buses, railroad stations, airports, and
restaurants. We are also providing international roaming service in more than 100 countries and regions
overseas, such as in North America, Asia, and Europe.
Furthermore, in February 2012. we commenced rentals of"Wi-Fi HOME' SPOT (CUBE)," an indoor
wireless LAN service that offers high-speed wireless LAN communications in the home. "Wi-Fl HOME
SPOT" is a home.Use wireless LAN router than can be connected to home broadband circuits. One special
leature is that the WI-Fi can be initialized for use with an nu smartphonc just by pressing a single button.
In addition, other Wi-Fi compatible devices, such as PCs and game machines. can also be easily used. In
the future. we will work to expand our wireless LAN services, under the namc "nu Wi-Fi' which will
cover both "Wi-Fi HOME SPOT" and "au Wi-Fi SPOT.'
From late January 2012, we began 10 roll out mobile NFC* (Type A/13) service in stages. As a result. the
use ofNFC services with mobile phones became possible for the first lime in Japan. NFC-enabled mobile
phones can be used for settlement services; coupon, membership card, and other services; and information
acquisition and exchange. Furthermore, they can be used overseas as well, such as for shopping and
transportation related functions.
* Near field communication: ISO international standard for near field wireless communications.
Compatible with Type AM and FeliCa. Coniactiess IC card functions, reader/writer functions,
inter-device communications functions. etc., can be used.
"Emergency Report Mail" delivers emergency messages to eli mobile phones in specified areas. From
January 31 2012 in cooperation with national and municipal entities. we began to pros ide disaster and
evacuation information," to provide notifications, such as various warnings and evacuation inlonnation
related to disasters. From March 30, 2012, we began to provide the "tsunami warnings" announced by the
Japan Meteorological Agency.
From spring 2012, we will offer the "Disaster Voice Delivery Service" for I S03 and later Android""
smartphones. Even when voice networks are congested and it is difficult to make a phone call, this service
will be able to deliver voice messages about personal safety and related topics. In addition to the "Disaster
Message Board" service, the "au Disaster Countermeasure" application has been available since
December 23, 2011. In this way, we are providing "security and safety" to customers using nu Android
smartphones.
On February 1, 2012, the Company established the KDDI Open Innovation Fund, a corporate venture
capital fund that will support promising startup companies. (Plans call for a total investment in the fund of
?5 0 billion ) Fhiough the hind the Company will invest in promising startup companies in Japan and
overseas. In addition, through cooperative activities, the Company will support service development,
provide cloud computing and other platforms, and cooperate in promotional initiatives. In this way, the
Company will foster the development of high-quality applications and services and, in conjunction with
the KDDI e Labo" incubation program, support the growth of startup companies.
Furthermore, the innovative applications and services that are developed through this fund will be
provided through "au Smart Pass." In this way, the Company will provide customers with new
experiences and value that realize the 3M strategy.
Fixed-line Business
Operating revenues in the year ended March 31, 2012 amounted to 915.536 million. 2,0% increase year on
year, due to the increase in operating revenues of group companies. which offset the decline in voice revenue
of the Company. Operating income amounted to *53,431 million. 122.7% increase sharply year on year, due to
the decrease in operating expenses of the Company as a result of network streamlining conducted in the
Fixed-line Business.
< Overall >
• The number oIFTTI-1 service subscriptions, consisting of -au HIKARI" and services ol'consolidated
subsidiaries (Chubu Telecommunications Co.. Inc.'s Commuf@-hikari," Okinawa Cellular Telephone
Company's "nu l'IIKARI Chura" and Okinawa Tel eeommunication Network Co.. Inc.'s ilikarifuru")
reached 2.268 million as of March 31, 2012.
• As of March 31, 20122 the number of "Metal-plus" subscriptions totaled 2.189 million,
• For "Cable-plus phone," alliances with cable television companies grew steadily, reaching 118 companies
and its subscriptions expanded to 2,074 million as of March 31. 2012.
• Consolidated subsidiary JCN Group, which oversees 18 cable companies primarily in the Tokyo
metropolitan area. had 1.142 million cable television subscriptions as of March 31, 2012.
<Consumer Services>
• "au HIKARI Home," a FTTH service for detached houses, expanded its service areas to Hokkaido,
lohoku. Cliugoku, Shikoku. Kyushu region, the service started from June I. 2011. On February 14 1 2012,
-6-
we began to provide customers who newly apply for -au III KARI Ilottic' with the Atcrm BL900IIW," a
new home gateway with built-in high-speed wireless LAN ltiiclionaIity and a maximum speed ol450
Mbps (theoretical speed), the highest in Japan.
On September 1, 2011. the Company began offering the Guarantee Support' service, which
provides customers using our "an one net" Internet connectivity service with Support from expert
operators for various problems related to Internet use. Specialized operators use the telephone and remote
operations to provide "Guarantee Total Support. which can he added to the "au one net" support service
to help resolve issues involving Internet network equipment connectivity. settings and methods of use. On
November 24, 2011, we began to offer "Guarantee Net Security.*' The "Guarantee Net Security" is ii
comprehensive security service that offers abundant security functions at an economical price. These
functions include virus and spyware countermeasures as well as phishing seam countermeasures and web
filtering that limits access to harmful web sites.
From February 14, 2012 t as an an HIKARI telephone added-value service, we began to provide the
"Telephone Option Pack," which offers customers a bundle of convenient services, such as caller ID and
call forwarding, at a package price.
<Corporate Services>
The Company have started "KDDI MULTI CLOUD,' a new brand for corporate customers on June 28,
2011 Through this service, we integrate smart devices and applications seamlessly with high quality
and "highly credible" networks and data centers as Ibundation to provide simple solutions and offer best
working environment to corporate customers.
On September 13, 2011. the Company and its subsidiary KDDI Web Communications Inc. participated in
Google's new "Getting Japanese Business Online" as a business partner in Japan. Aimed at promoting ICT
use among small and medium-sized Japanese businesses..the protect supports the creation and operation
ofsebsites for small and medium-sized businesses and promotes the use of IT in business In conjunction
with KDDI Mitomete Office a membership program that supports the establishment of office IT
environments, we will strongly support small and medium-sized businesses.
In October 2011. the Company acquired 85.5% of the common stock of CDNetworks Co., Ltd., of South
Korea, which became a consolidated subsidiar of the Company. CDNetv.orks is a provider of content
delivery network (CDN)NØ services in the global market. In addition to adding CDN services to our
service lineup we will also pursue synergies from this acquisition, such as network mod facility cost
reductions. In addition as a result of this acquisition, on I ebruaty 1 t 2012 we began to provide KDDI
Global Content Accelerator," a CDN service that accelerates the performance and dramatically increases
the reliability and scalability of web sites and web applications.
Note: CDN services realize acceleration of Internet communications through temporary caching and delivery of
content using servers that are located closer to end users.
From December 2011. we begat) offering service at the "TELEHOUSE HONG KONG CCC," a
large-scale data center in Hong Kong that has a total floorspacc of 36,000 square meters and meets the
TELEI-IOUSE global standard. From January 2012, we also began olThring service at the "TELEHOUSE
FRANKFURT," a data center in Frankfurt, Germany that has a total floorspace of 67,000 square meters.
With the opening of these data centers, we have 22 overseas TELEI-IOUSE data centers in II regions and
14 cities.
Other Business
Operating revenue for the year ended March 31, 2012 decreased 6.5% year on year to Y106,873 million.
Operating income decreased 49.6% year on year to 4.2911 million.
Status of major affiliates
tJQ Communications Inc. (hereafter: "UQ')j an equity method affiliate of the Company, has recorded
2,265,700 subscriptions (topped 2 million subscriptions on February 26, 2012) and 19,714 base stations as of
March 31, 2012.
The service area included 100 million people as of January 24, 2012. Moreover. it has been extended to
include Tokyo subways and the areas alongside principal railroad lines throughout the country, including the
Tokyo metropolitan area, Chuhu, and Kansai, so that WIMAX services can he used in stations and on trains.
Also, we are working to increase convenience with WIMAX 00 smartphones, tablets, and other devices.
-7-
In April 201 I. .Iupitcr Teicconimunicat ions Co.. Ltd. (hcreaflcr: "J:COM"). an cquity method aibliate, began
'oiling out J:COM PHONE Plus, which uses the Company's telecommunication networks and J:COM's
cable TV networks. in J:COM's service areas. From March IS. 2012. in stages. the backbone circuits linking
the service areas ofi:COM. which has operations in the five major metropolitan areas in Japan, will be
migrated to our consolidated IP core network, thercby strengthening and increasing the reliability of
J:COMs network, First, we will start from the Sapporo.Tokyo, and then in stages we will move on to other
areas. In this way. within 2012, about 70% o' traffic will be migrated, and plans call for the migration to be
completed in 2013.
The accounts of.libun Bank Corporation (hereafter: "Jibun Bank"), an equity method affiliate of the
Company, numbered 1.36 million accounts. 160,000 accounts more from March 31, 2011 : and 349.7 billion
yen in deposits, 126.3 billion yen more from March 31. 2011.
From July 2011 Itbun Bank increased customer convenience by enabling the USC 01 a service for real-time
settlement ftom libun Bank accounts the Jibun Bank Payment service," through an one tofo Targeting
individual customers. on October II. 2011 1 the hank also began offering RMB-denominated foreign
currency deposits via the Internet.
au Insurance Company. Limited (hereafter: "au Insurance"), established by the Company and Aioi Nissay
Dowa Insurance Co., Ltd. through joint investment started its services on May 25, 2011.
In addition to offering the M) Smart Insurance (Standard Accidental Insurance)" including 100 Bicycle
Plan" and "Leisure Plan." from November 29, 2011. au Insurance began to offer "My Smart Insurance world
(Overseas Travel Insurance), for a premium of V500 per day.
Notes: 1. "Smart Value" is a registered trademark of Energy Management Corporation.
2 V i Ii is registered trademark of Wi-Fi Altnnce
3 iPhone is a trademark ofApple Inc The trademark 'iPhone' Is used with a license from Aiptione k f'
4"Android" and Google are trademarks 01 registered trademarks of 000gle Inc
5. WIMAX is a trademark or a registered trademark of WiMAX Forum.
4."GALAXY 5" is a trademark or a registered trademark of SAMSI.JNG ELECTRONICS Co., Ltd.
5.MOTOROLA PHOTON and MOTOROLA XOOM are registered trademarks of Motorola Trademark
Holdings, LLC.
6."DIGNO" is a registered trademark of Kyocera Corporation.
8, "Windows' Phone" is a trademark or a registered trademark of Microsoft Corporation.
9 is a registered trademark of Sony Corporation.
10. 'Felica" is a contaciless IC card technology developed by Sony Corporation.
II. A term is a registered trademark of NEC Corporation.
4. Outlook for the Year ending March 31, 2013
The consolidated financial results outlook of the Companies for the year ending March 31, 2013 is as
follows; (Amount unit: Millions of en
Year ended
March 31, 2012
Forecast, year ending
March 31, 2013
Increase
(Decrease)
Increase
(Decrease) %
Operating revenues 3,572.098 3,580,000 7,901 0.2
Opemattnciucomc 477.647 500,000 22,352 47
Ordinary income 451,178 490.000 38.821 8.6
Net income 238,604 250,000 - 11,395 4.8
In operating revenues, lower unit sales of handsets had the effect of decreasing revenues, but the launch of au
Sniurivaluc and au Smart Pass expanded the customer base, which had she effect of increasing revenues.
Consequently. operating revenues are forecast to increase to 3.580.000 million on a consolidated basis.
III operating expenses, the Company is forecasting a decline in sales promotion costs due to lower unit sales of
handsets. As a result, the Company is forecasting an increase in operating income, to t500.00() million. In
ordinary income. the Company anticipates improvement in equity in profit/loss of affiliates and is forecasting
an increase in ordinary income. 10 -Y.490,000 million.
In net income, the Company anticipates impairment loss on facilities with low utilization and special tosses on
about Y80,000 million in communications facilities that the Company is considering disposing of. Nonetheless,
the Company is forecasting an increase in net income, to 250,000.
Because forecasting for the period is difficult due to volatile conditions in the telecommunications market
related to competition among carriers, the Company has not prepared a forecast of consolidated business results
tor the six months ending September 30, 2012.
8-
(2) Analysis on Consolidated Financial Position
I. Consolidated Financial Position
Year ended
March 31, 2011
Year ended
Match 31 1 2012
Increase
(Decrease)
Total assets V.31778.918M V.4.004.009M V.225.090M
Shareholders equity V.2.103.331M V.2.060.746M (V.42,584M)
Equity ratio 55.7% 51.5% (4.2%)
Net assets per share V.4951386.23 V.539,206.73 V.43820.50
Interest-bearing debt t4979,629M V.l,046,754M V67.124M
Consolidated total assets as of March 31, 2012 amounted to V.4,004.009 million, an increase of V.225.090 million
from March 31, 2011. This increase was primarily attributable to factors such as increase in accounts
receivable-trade.
Total liabilities amounted to V.1.875.384 million, an increase of V.268.305 million from March 31, 2011. The
malor factors contributing to this increase were issuance of convertible bond-type bonds with subscription rights
to shares.
As a result of these factors, the shareholders' equity ratio decline from 55.7% to 51.5%
Interest-bearing debt as of March 31. 2012 included V.200,916 million of convertible bond-type bonds with
subscription rights to shares issued for the year ended March 31, 2012.
2. Consolidated Cash Flows
(Amount unit: Millions of yen)
Year encicd
March 31 2011
Year ended
March 31. 2012
Increase
(Decrease)
Net casts provided by (used in) operating activities 717,353 725,886 8,532
Net cash provided by (used in) investing activities (440,545) (484,507) (43,961)
Free cash flows 276,807 241,379 (35,428)
Net cash provided by (used in) financing activities (279,998) (225,931) 54,067
Effect ofeachange rate change oil cash and cash
equivalents (2,416) (3,125) 1.291
Net increase (decrease) in cash and cash equivalents (5.607) 14,322 19,929
Cash and cash equivalents at beginning 01' period 165,476 159,869 (5,607)
Cash and cash equivalents at end ofperiod 159,869 174,191 1 14,322
Note Free cash flows are calculated as the sum of 'net cash provided by (used in) operating activities" and "net cash
provided by (used in) investing activities."
Operating activities provided net cash of 1 1725.886 million largely due to V.454.419 million of income before
income taxes and minority interests. V.417.886 million ol'depreciation. V.207.033 million of increase in notes and
accounts receivable-trade. V.62,003 million of increase in accounts payable-other. V.23.441 million of increase in
notes and accounts payable-trade, V.88.625 million of income taxes paid, and V.33.386 million of income taxes
relitod. etc.
Investing activities used net cash of V.484,507 million mainly due to V.318.870 million for purchase of property,
plant and equipment, V.75,914 million for purchase of intangible assets, and V.57.530 million for purchase of
stocks ol'suhsidiaries and affiliates. etc.
Financing activities provided net cash of *225,931 million. This includes V.201.000 million for proceeds from
issuance of convertible bond-type bonds with subscription rights to shares. V.220.969 million lbr purchase of'
treasury stock, and V.133,750 million for repayment of long-term loans payable. and V.63,689 million for cash
dividends paid.
The sitni of cash flows from operating and investing activities showed a net outflow of V.241,370 million, down
V.35.428 million year on year.
As a result, total amount of net cash and cash equivalents as of March 31, 2012, increased V.14,322 million from
Match 31.2011.to4174.191 million.
-9-
I Cash Flows Indicators
Year ended Year ended Veat ended Year ended Year ended
March 3 1, 2008 March 31, 2009 March 31, 2010 March 31, 2011 March 31, 2012
Shareholder's equity ratio 58.5% 53.7% 52.8% 55.7% 51.5%
Market equity ratio 94.4% 60.0% 56.4% 57.9% 51.2%
)ebt repayment period (year) 1.0 1.2 1.5 1.4 1.4
Interest coverage ratio 52.7 60.6 59.7 51.1 56.3
Note:
Equity ratio: (Total net assets - Stock acquisition rights - Minority interests) / Total assets
Market equity ratio: Market capitalization /Toial assets
Debt repayment period: Interest bearing debt /Cash flows
• Interest coverage ratio: Cash flows I Interest payments
• Market capitalization is calculated by multiplying the closing stock price at fiscal year-end by the number of shares
outstanding (not including treasury stock).
• Cash flows from operating activities in consolidated statements of cash flows are used for operating cash flows.
• Figures for interest-bearing debt cover the amounts of loans and bonds that are recognized in consolidated balance sheets
and liabilities upon which interest is paid. Further, regarding interest payments, the amount of interest expenses paid in
consolidated statements of cash flows is used.
(3)Profit Distribution
Regarding the return of profits to shareholders as one of the priorities of its business management, the Company has a basic
policy ofconlinuing to pay stable dividends while maintaining financial soundness.
Regarding dividend payments for the year ended March 31, 2012, the Company has already paid an interim cash dividend
of Y7,500 per share in order to express gratitude to its shareholders for their constant support, and in light of an overall
consideration of business development aimed at improving future business results the Company plans to pay an increased
year-end cash dividend oft8,500 per share, tip tttl.000 year on year.
Further, for the year ending March 31, 2013. the Company l)IattS to pay out W8,500 per share for both interim and year-end
cash dividend, making the full-year amount Yl7.00O per share.
Going forward, the Company will work to increase the consolidated payout ratio to 25% - 30% range while considering
investment for the sustainable growth remains.
(4)Business Risks
As the Companies pursue its business, there are various risks involved. The Companies take every effort to reduce these
risks by preventing and hedging them.
However, there are various uncertainties which could have negative impacts on the Companies' brand image, liability,
financial position and/or earnings performance such as; -
- subscription growth trends out of line with the Companies expectations due to competition, rival technologies and rapid
market shifis
- breach of obligations regarding communications security and protection of customer privacy
- natural disasters and accidents including earthquake, tsunami, typhoon, etc.
- revision or repeal of laws and ordinances governing telecommunications, together with related government policies
- general legal and regulatory, litigation and patents. personnel retention and training retirement benefits,
asset-impairment accounting, telecommunications sector consolidation and business restructuring in the Companies
- 10.
2. The Group
The Group Coll) p] iscs the Company. 118 consolidated subsidiaries (Japan: 44 companies, overseas; 74 companies). siid 24
affiliates (Japan: 15 companies. overseas: 9 companies). The Group's main business lines are the Mobile Business, which
provides mobile communication services, sales of mobile trmtnils and content business, etc and the I i'.cd line Business.
which provides broadband services, domestic and international telecommunications services, data center services, and ICT
solution services, etc. Affiliates include 2 1 equity-method affiliates (Japan: 14 companies. overseas: 7 companies).
The status of the Company, consolidated subsidiaries and affiliates within the Companies business and their relationships with
segments are as shown below.
CMobile luusiiwsc>
Principal services Major consolidated subsidiaries and affiliates
Mobile communication domestic The Company
services (voice and data), • Okinawa Cellular Telephone Company [JASDAQ]
sales of mobile terminals. • KDDI Technical & Engineering Service Corporation*
contest business • Wire and Wireless Co., Ltd. • WebMoney Corporation • medibtu corporation
o UQ Communications Inc.
o Mobutoku Co., Ltd. etc.
overseas to KKBOX, Inc.
<I:i ed_liuie Husines>
Principal services Major consolidated subsidiaries and affiliates
Broadband services domestic The Company
(FTTI-1 services and cable a Japan Cablenet Holdings Limited
television services. etc.), • Japan Cablenet Limited
domestic and international • Chubu Telecommunications Company, Incorporated
telecommunications services, • Okinawa Cellular Telephone Company EJASDAQI
data _enter services, and a Okinawa Telecommunication Network Co...Inc.
CT solution services a KDDI Technical & Engineering Service Corporation* • KDDI Web Communications Inc.
o Jupiter Tcleconumunications Co., Ltd. [JASDAQ1 etc.
overseas a KDDI America. Inc. • KDDI GLOBAL, LLC • KDDI Europe Ltd. • KDDI Singapore Pte. Ltd. • KDDI China Corporation • KDDI KOREA Corporation • Telehouse International Corp. of Europe Ltd. • TELEHOUSE International Corp. of America • DMX Technologies Group Limited (SOX) etc.
<Others>
Principal services Major consolidated subsidiaries and affiliates
Call center service, and domestic • KDDI Evolva Inc.
research and advanced • Kokusai Cable Ship Co.. Ltd
development N KDDI R&D Laboratories, Inc.
a Japan Telecommunication Engineering Service Co., Ltd.
a KDDI Technology Corporation
o Kyocera Communication Systems Co., Ltd.
o .tibuus Bank Corporation etc.
overseas o MOBICOM Corporation etc.
Note; • : consolidated subsidiaries n: equity-rnethod affiliate
KDDI Technical & Engineering Service Corporation changed its name to KDDI Engineering Corporation on April I, 2012.
Business schematic diapram of corporate aroups are shown as belo.
I Mobile Business I
[domestic)
The Company
• Okinawa Cellular Telephone Company [JASDAQ)
• KDDI Technical & Engineering Service Corporation
• Wire and Wireless Co., Ltd.
• WcbMoney Corporation
• mediha corporation
• UQ Communications Inc.
o Mobaoku Co., Ltd. etc.
[overseas)
• KKI3OX, Inc.
Fixed-line Business I
[domestic)
The Company
• Japan Cablenet Holdings Limited
• Japan Cablenci Limited
• Chubu Telecommunications Company, Incorporated
• Okinawa Cellular Telephone Company EJASDAQI
• Okinawa Telecommunication Network Co., Inc.
• KDDI Technical & Engineering Service Corporations
• KDDI Web Communications Inc.
• Jupiter Telecommunications Co., Ltd. [JASDAQ) etc.
[overseas)
• KDD1 America. Inc.
• KDDI GLOBAL, LLC
• KDDI Europe Ltd.
• KDDI Singapore Ftc. Ltd.
• KDDI China Corporation
• KDDI KOREA Corporation
• Telehouse International Corp. of Europe Ltd.
• TELEHOUSE International Corp. ofAmerica
• DMX Technologies Group Limited [SGX] etc.
Other Business
[domestic]
• KDDI Evolva Inc.
• Kokusai Cable Ship Co., Ltd
• KDDI R&D Laboratories, Inc.
• Japan Telecommunication Engineering Service Co.. Ltd.
• KDDI Technology Corporation
o Kyocera Communication Systems Co., Ltd.
o Jibun Bank Corporation etc.
[overseas)
o MOB ICOM Corporation etc.
Note: •: consolidated subsidiaries 0: equity-method affiliate
KDDI Technical & Engineering Service Corporation changed its name to KDI)l Engineering Corporation on April 1. 2012.
0
rn
0
CD
co
12-
Maniigejnenf Policy
(1)Basic Management Policies
• We aim to become a Company that can provide excitement, safety t happiness and smiles of gratitude to
people in the world by offering highly credible networks and value-added products and services.
• The Companies will advance total customer satisthction (1 CS) initiatives that will heighten the level of
satisthetion among all siakeliolders.
The Companies will emphasize cash flows and work to become a company that is attractive to its
shareholders and other investors.
The Companies will work to establish an even sounder financial position by making efficient capital
investments and reducing various expenses rigorously.
• To step up information security, we are working to ensure thorough information management and compliance
and reinforcing our risk management structure.
The Companies will actively implement activities to preserve the environment—including energy saving.
resource saving, recycling, and green purchasing—in order to emphasize harmony with the global
environment and create a rich society that is fully in accord with human nature.
The Companies will actively contribute to the development of a rich communications-based society in
adherence with the overriding goal of its corporate social responsibility initiatives, which seek to support
social and economic activities in all areas by providing secure and convenient telecommunications
services.
(2)Medium-to Long-term Management Strategies, Targeted Management hid icators, and
Important issues
We will promote our mission as a telecommunication COl)OflY that supports a lifeline through construction of
telecommunication infrastructure network that can he recovered in case of major natural disasters, and creation
of L3CP upon the experiences of the Great East Japan Earthquake.
In regard to live major accidents occurring in the period from April 2011 to February 2012, the Company has
been directed by the Ministry of lntcrn'il Affatis and Communications and by a MIC liaison commOtee to
rapidly formulate rigorous countcrmeasuies including recurrence prevention countermeasures, and to report on
the results of their implementation and future initiatives. The Company established an investigative committee,
which is led by the president, and targeting the prevention of a recurrence, implemented a complete overhaul,
formulated improvement measures, and implemented them.
The Company expresses its sincere apologies for causing trouble and concern for customers and related parties
as a result of this series of accidents, and to provide a comfortable communications environment for customers,
the Company will continue to implement countermeasures to further increase reliability.
rue Companies have formalized "three commitments" to respond quickly to changes in the operating environment,
while at the same time growing sustainably and taking the lead in meeting emerging needs.
• "More connected" -- We will aim to achieve tnulli-network connectivity by organically linking networks
owned by the Companies, including mobile phone. FTTI•l. CATV and WiMAX networks, and various devices.
We will also provide a high-speed communication environment and attractive content optimized for
multi-device access. At the same time, the Company will enable multi-usc services tailored to individual
customer preferences, thereby making ourselves "more connected" to customer.
"More diverse values" --'File ongoing proliferation of Internet technologies, led by lP connectivity, are
spawning IC')' needs in a broadening host of fields, including medicine, health, education, government and the
environment. By taking a more active part in various corporate initiatives and lifestyle aspects, the Companies
oiler further value to customers,
"l".lorc global" -- Overseas. many countries are experiencing robust economic growth. Meanwhile, Internet
diffusion in numerous emerging markcts continues to lag. The Companies are working to meet the needs of
markets around the world by developing communication-related businesses tailored to individual countries'
cultural and socioeconomic conditions, and is working toward global information and telecommunication
technology (ICY) and building communication environments to this end.
- 13-
To realiy.e these visions. we will advance the hill-scale implementation oh the 3M strategy (Multi-network.
Multi-device. Multi-use). which will enable customers 10 select a device the meets (heir own preferences and to
eitjy a variety of content through tin optimal network that can be used anytime and anywhere.
Under the Smart Passport Concept, which is phase I of the 3M Strategy. 'au Smart Pass" and €au Smarivalue"
were launched in March 2012 and have earned the satisfaction of iiiaiiy customers. Targeting increases in customer
value by leveraging (lie 3M strategy as one of our strengths, in the hitture Nye will continue to enhance networks.
handsets, and Service.
In addition, from the year ending March 31. 2013 : the segments have been reorganized from the previous
categories of Mobile Business and Fixed—line Business The four new segments have been determine(] in
accordance with the management approach reflecting the units for which management resources es 'it e allocated and
financial results are evaluated.
<Personal Services>
With the Smart Passport Concept as its core strategy, through "au Srnartvalue" the segment will work to expand
sales of the Companies r TTI I services—"au HIKARI Commuf1) hikait and au HIKARI Chuia In
addition, the segment will strengthen its relationships with CATV companies and electric power related
communications companies. The segment will also waiL to expand the au customer base achieve gains in
revenues and profits, and maximize the number of FMC IDs* ' FMC ARPU
Moving forward, the segment will work to develop an extensive handset lineup including smamtphonec with
comniunmatmon', fl unctions that have been enhanced, such as through the addition of functions that are standard in
Japan; high-speed smartphoncs utilizing au + WIMAX Wi ii routers and other data communications devices; and
tablets In addition the segment will work to develop and provide innovative e new services and new content and
work to expand service areas and further increase communications quality. The segment will also strive to provide
a comfortable communications environment, at higher speeds than were previously possible, through the
introduction of L1'E.
* Number of tl)s for subscribers to bath fixed-tine and mobile
<\'alue Services >
The Value Services segment will continue to provide cloud bascd content services, centered on entertainment
services. These will be linked with au Snvmrt Pass for multiple devices and multiple operating systems.
At the same time by establishing a service ice platform moving toward more open services and nurturing startup
companies, the segment will work to increase the appeal of these services and achieve linked acquisitions of
service subscriptions. In this way, the segment will strive to maximize Value ARPU.
< Business Services >
The Business Services segment will develop the "KDDI MULTI CLOUD" brand for corporate customers, provide
cloud solutions that seamlessly integrate across the range 11am sniartphones and tablets to networks, data centers,
and applications, and propose work style reforms to customers. In addition, through the provision oP'Smartvalue
I'm Business" 3M services l'or small and medium-sized companies, the segment will strive to increase the number
of KDr)l customers.
<Global Services>
In addition to expanding "TELEI-IOUSE" data centers. the Global Services segment will strengthen its system for
the One-stop provision to customers of optimal. high-value-added JCT solutions through the utilization of the
services of consolidated subsidiaries CDNetworks and DMX. In addition, the segment will work to expand its
customer base, including non-Japanese companies. In addition, the segment will also work aggressively to expand
consumer businesses, such as Internet broadband operations in emerging countries and MVNO operations in the
U.S.
- 14-
A. Consolidated Financial Statements
(1) Consolidated Balance Sheets
(Amount unit' 4dIions olven)
As ofMarch 31, 2011 As of March 31, 2012
Assets . .. . . . .
Noncurrent assets
• Noncurrcnt asscls-lclecomimijtieatjotis
Property. plant and equipment -
• Maéhmery4 . : . -. : •;: 2.653.301 . 2,7.55,669
Accumulated depreciation (2,024.885) (2,174 551)
Msthincrv,nt . . ... . . . . .. . . . .. -. 628.415 - . 581,11.7
Antenna facilities 593,481 623,595
Acuniula1ë&depreciation . •. .: ..... (240,019). .. ....... (275285)
Antenna facilities, net 353.461 348,310
1 oil linL 1u1nteq 4 3M 061 376 92
Accumulated depreciation . (228.849) (245.619)
PjaLa1.Jjne facil.hids, ne ..........•, •: . - . :- .. 5. ..' .1a212. 5.'- •- . . . .. 130,772
Long-distance line facilities 106,804 104,491
Accumulated depreciãtjoii . : '- I. .........•- •-.- : (965802). . . •. . (99.010)
Long-distance line facilities, net 10.002 5.480
Engmeenng ficilities4 64 17) 64 422
Engineerihg facilities, net ... ... .. . . . 27.198 . ... •.' .'. . 25.70
Submarine line facilities 4 . 55,103 52.390
Accumulated depre.iatrnn (4 567) (45 870)
Submarine line facilities, net 9.536 6.519
I3stildin,4 421 992 426 03
Accumulated depreciation (207,774) (221,118)
Bui]ding net 214217 205384
Structures, net 32.446
Land ..............................s •-- •. •--- . . . ........... . . • .242,197.
Construction in progress 75,236
Other tangible Assets4 :.................................................... .......... 116.963:
Accumulated depreciation (82,776) (92,270)
Other tangible assets,net s' . . ., •'S 34,187
otal propertY, plant and equipment' 1.752,112 1.747955
I ntangihlè ass cts . . .-. :z: •-' •-................--. :- .:....
Right of using facilities 9,120 10.577
Solhtire 191719 175084
Goodwill 17.563 221331
Other intn,blcsscls • -' -s.: . 5.- . 10.223 •-.-: •-. .10,369
Total intangible assets 228,626 218,361
Total iuoi'ictirrent asseis-ie1ecommunicatjors business ............... 1,980.738 . . L966,31
Incidental business facilities
Property, plant and equipment • - • - . - •. • ' :: • - : : • .. - • -. • •
Property, plant and equipment 231868 259.155
Accun'iulated dpreciation ............................................- - (1.11,158) - • - -• (123,384)
Property, plant and equipment, net 120,709 1357770
Total woprtY.pant and equipment t • . : -. - - • -. --. 120309 - - -, • 135,770 -
- 15-
(Amount unit: Millions of yen)
AsofMarch 31,20)) As ofMarclt 31. 20)2
Intangible assets
Total intangible assets" 62,301 91.604
Total noncurrent assets-incidental business 183.010 227.435
Investments and other assets
Investment securities' 73,898 8014
• Stocks of subsidiaries and affiliates 3561887 •. 351,815
Investments in capital of subsidiaries and affihatcs 2 182 185
. .ong-term prepaid expenses • . . S . 82.240 . 91',272
Deferred tax asscls - 128,686 104,829
.Other investment and other assets 4 . .. .: : . . 49,278. :. .. : . 7,777.
Allowance for doubtful accounts (8.103) (9,120)
,-Totat mvcSIments and othet aSsets .......................... ., .... . ...: . .; .• 673.371
Total noncurrent assets 2,846,8 19 2,867.126
Ca,rrentasscts....................................... .• . . . ... ... .. .. - • . . . . -. ' ,................ 77
Cat and deposits" . - 136,921 . 100,037
Notes md ac.ounts reiable trmde 4 71 508 , 760 890
Accounts receivable-other 68,190 66,286
4Short lum investment su.ur,Ut', 2 20) 80 18
Supplies' . 58,352 , 65,232
Deferred Vtx ascts 64 079 781
Other current assets' 19.6)2 21,427 •
Allowance fordoubtful accounts ' ••' •' •. S .; :.: . 5: . .. . .i3,7.67) :
. '..•-.. l4;960):
Total eminent assets 932,098 1.136 882
Total assets
Liabilities
Noncut-rent hLiliues
Bonds payable4 . . 414,978 349,991 .
Cons crlible bond 9C bonds %th subse iptioti i iglats to shares 2009)6
Long-term loans payable4 . 414,187 . 301,286
Pm o iion for rettren)eni benefits 18 66 18 743
Prevision for point card certificates 85,197 91,453
the noncuirLnt ltab,hjt,cs 66 780 72 42
Total noncurrent liabilities 999.800 1.034.733
Cut tent liabilities
Cmtrrent portion ofnoncurrctn liabilities" 138,799 194,11.2
Notes nd accounts payable-tirade . 65 598 90661
Short-lcrm loans payable 1,304 .. 1,486
Accounts -piabk iher 192 402 273 119
Accrued expenses 14,253 20,370
1nome takes jaasabl_ 7 '764 149 771
Advances received 72,437 63,937
Pib'ision Th bonuses . .. . . . . 19319 •.. • -.. 20,07:
Provision for loss on the Great East Japan Earthquake 16,282 1,992
Other. eurment liabilities . -. . . • . ' ....... 2813 : 35i 9
'bitt) current liabilities 607,278 840,650
Iot.,1 liabilities 1', 607
- 16-
(Amount unit: Millions of,en)
As of March 20) I As of March 3).2012
Net assets
Shareholders' equity .
CapitalStock S : . 14L851 I 141.851
Capital surplus 367,091 367,104
Retained earnings . 1,704,170 . . 11879,087
Tieasury stock (125,244) (346,163)
Total shitreholders' qtfity.•. ..,. . ..... • .....2,087,869 . . . 2,04.1879
Accumulated other comprehensive income
Vtilu tuot) diflctetice op vul'tb1e for sale securIties 28 612 36442
Deferred gains or losses on hedges . 32 . (676)
Vrein eunenoy lransation.ädjustnsent
Total accumulated other comprehensive income 15.461 18.866
Subscription rights to shares . i

0
Minority interests 67,002 66,749
I 661 net assets 17) 39 2 128 24
Total liabilities and net assets 3,778,918 4.004.009
'7-
(2) Consolidated Statements of (Comprehensive) Income
(Conmil dialed Statements of Income)
(Amount unit: Millions of yen)
Year ended March 31 2011 Year ended March 31, 2012
Operating income nd.loss from telecommunications*. . . . .
Operating teveflue
TtaI oierating revenue . . . 2,489,403 2.394,135'
Operating expenses
,Bt S. . ... . . . .. . .• 653.017 667,74
Operating expenses . 117 51
l-,1iti rllalp lcnance expenses 305 6Q7 301 304
Common expenses . 2,297 2.605
Administritive eipcnse

70.927 73 210
Experiment and research expenses 8,866 7,676
Depicciation 423 447 389 007
Noncurrent assets retirement cost • 18.540 16,226
comnntmcationfaciliri fee 362 480 347 227
Taxes and dues 39.500 41,731
• . .Tota1:oratjngexpens& . . . . . . 1,884.891 •• ..• 1,844,791
Net operating income from telecommunication 604,511 549,344
Operatmg inconie and loss from incidëtital business , : : •• : :.............
Operating revenue 945.142 1,1772962
Operatincxpenss . : •,................• 1,077,742 '• .1,249.658
Net operating loss from incidental business (132.599) (71.696)
Operating mcome' -171 911 477:647
Non-operating income
lntrcct income 640 96S
Dividends income 1.527 1,719
O tin on mstnicnts in silent partnership 97). 654
Miscellaneous income 6.888 9,975
• Total )ion-operaung inconiè : .. : . •• . •.. •. 10,034 . . l3.31
Non-operating expenses
lntcretexpenscs - •: •• . ;•• • , . . . . 14,160 . . 12,891
Equity in losses of affiliates . 19,948 18,297
MiscelJanous'penes. •• . . •. . . •. . . . 7,159 • •.. . 8.595
Total non-operating CXPCOSCS 41 .29 39,785
• Ordinaiyiiacornc .•. .. ' •• . ••.. : 440,676
Extraordinary income
Gaiti on sales of noncurrent assets 2 . • , .. . . 1,314 .. . .. 170
Gain on sales of investment securities 5,618 137
Gaiion ncg51i'egoodwiD '. .• •• . • . . 534 . . .......235
Gain on reversal of subscription rights to shares 450 493 -
Gain on transfer from business divestilures . . -- . . - . 3,615
Dividends due to liquidation of silent partnership contract - 6,976
Reversal of provision forlosson the Great Easriapait •- . • (814
Thial cata nordinary income 7,918 18,442
-Ill-
(Amount unit: Millions of yen)
Year ended March 31. 2011 Year ended March 31. 2012
Extraordinary loss
Loss on sales of noncurrent assets - 676
Impairnieni loss3 I : 52.141 9.941
Loss on retirement of noncunent assets 5 31,816 --
• . : 1 .ss on lut of invcstnlcnt securities 368 : .1 504
Loss on sales of stocks of subs diaries and aliliaIes 176 -
I oss on tdjus(menl br clrmgea 01 accounting 241
shrsehrd for Isset retirement obliLIl ions
Loss on the Great East Japan Earthquake' 17.590 4,073
Tot il extraoidunir, losses 103 3j5 15 201
Income before income taxes and minority interests 345,259 454,419
1nonse laxec current 102 617 177 278
Income taxes-deferred (21.380) 30,282
'3 ot'tl income I'txts 81 237 207 560
Income before minority interests 264,022 246,858
!v1inorii miciests in mcoin 77777777-9.00.11 8254
Net income 255.122 238.604
- 19-
(2) Consolidated Statements of (Comprehensive) income
(Consolidated Statements of ComprehensiveIncome)
(Amount unit: Millions of yen)
Year ended March 31. 20I1 Year ended March 31, 2012
Income before minority interests ., . . : 264.022 246.858
Other comprehensive income
Valuation difference oh itvailabk-forsa1c scóurilics."........................................... 678) . 7.190
Foreign currency translation adiustinent .. (7.496) (31640)
Share of other cotnptchenstsc mcomc of as1iocvi)e%L (17) (898) quity thol . " .. . .'.. .. . .". . accounted lot ttsmg c me . .\ . . . . . . . . . . .
Total other compichensive income (13,192) 2,651
Compiehensi i. mcome' 20 829 24Q 10
Comprehensive income attributable to
tomprchcn5te income aliribulahie to oncrs of the parent 243 08 242 91 1
Comprehensive income attributable to minority interests 7,321 7.500
-20-
(3) Consolidated Statements of Changes in Net Assets
(Amount unit: Millions ofyen)
Year ended Match 31. 2011 Year ended March 31, 2012
Shareholders equity . . . . . . . .
Capital stock
Balance at the end.ol previous period : : 141.851 . ' . 144851
Balance at the end of current period . 141 ,851 141,851
Capital surplus
Balance at the end of previous period . 367,091 367,091
Ch Inge', 01 tin1s diffiN the pLnod
Disposal of treasury stock . . . - 12
Total changes oNieths iktring the period -- . : . •. . -- . ____. . . . -.. . .. . --12.
Balance at the end of currCnt period 367,091 367,104
RLtalnt.d canhtngs ,. s
Balance at the end of previous period -, . 1.506,951 . 1,704,170
Changes ci Items during tie period
Dividends from surplus - . . (571903) (63,687)
4et inconie 2c5 122 238 604
Total changes of items during the period . 197,218 174,917
B'il'inee st the end of

Orr Lnt period I 704 170 I 879 087
Treasury stock
lialince at the en_..d of prevIous period 244) (I2.244)
Changes of items during the period
PurLlvisc of treaur5 stock (99 9991 (230 969)
Disposal of treasury stock . - 50
1 ohtl chatigec of ttetnc durmg the period (99 999) (220 919)
Balance at the end of current period (125.244) (346,163)
'I ot-si shariholders equity
l3slsrice at this end of previous period 1,990.650 2,087,869
chatiges of items during th period
Dividends from surplus (57,903) (63,687)
Net income 255 12' 238604
Purchase of treasury stock - . (99.999) (220,969)
Dtspos4l of tressun stock 62
Total changes of items during the period 97,218 (45,989)
B'th'scc

at the end ci current period 2 0b7 S69 204! 879
-21-
(Amount unit: Millions of yen)
Year ended Mich 31 2011 Year edcd March 31. 2012
Accumulated other coil) prelieitsive inCOOIC
\'aluaiion difference oil available-liir-sale securities -
Balance at the end oi previous period 34.326 28.612
Changes of items during the period
Net changes of ilems other than shareholders' equity -'- (5,734)- 7,830
Total changes of items during the period (5.714) 7,830
B'i1ane at the end of current pLriod 1 8 612 36,442
Deferred gains or losses on hedges
13'ilance

at the end of previous ptrtocl 32
Changes of items during the period
)'ks changes ol Items othe than sftarLholdLrs quit 2 (708)
Total changes of items during the period 32 (708)
Balance at.the end o f cur' rgnt period: . . ................................ •- .. . 32 .......................... . (676)
Foreign currency translation adjustment
13'ihne at the end ol pr\ tous period it ,,K (7;2) ¼ (17 1 82
Changes of items during the period
Net ch'ingcs of ttcms other titan shareholders equity ('i 972) (3 716)
Total changes of items during the period (5.932) (3.716)
BaItinbe at the end &'currt.nt period (ii 382) (16 899)
Total accumulated other comprehensive income
l3alatce 'it the end 01 previous period 27076 IS 461
Changes of items duritig the period
iañgcs f itetils othei:than shärcloldcns' equity ..................... .- :: 41 E614)' .. . 34O4
Total changes of items during the period (11,634) . 3,404
Balance at the end of current period 35461 38 866
Subscription rights to shates
l3ahnce 'it the end of pres toLls period S 1 606 I 504
Changes of items during the period
et;changes ofitoms other than shareholders'
Total changes of items during the period (101) (376)
• Balance at the end olcurrent period •. . : -
. : •. -•• : -- 1,504
Minority interests
l3ahncc 'it the end of pru jogs period 59 117 67002
Changes of items during the period
Net changes of items othi,r than shareholders cqtnl 7 b5 (253')
Total Changes of items dories the period 7.885 (253)
Balance sit the end of current pdriod •- . . . .' . .__-•. 67,002......... -- . . 66.749
Total net assets
Bohmcc at the end of previous period 2078450 2 171 8 9
Changes of iierns during the period
Pividcttds Iroto surplus . . . ......................................................... . . . (579(33) . . (63,6$7)
Net income 255,122 238.604
Purchase of tivasur3 stock 99 999) (220 969)
Disposal of treasury stock - 62 Ir
- Net changes of itens other than slsrcholders' equity . - .- - - - '(3.830) 2775
Total changes of items during the period 93.388 (43.214) 11IJalattec at the end dfcurrent period - . .. -. -- -. -, 2d71,839 - . 7.7%. .. - 1128.624
-22-
(4) Consolidated Staien,etns of Cash Flows
(Amount unit: Millions of yen)
Yeat ended March 31. 2011 Year ended March 31 i 2012
Net cash provided by (used.in ) opertiling activities
Income before income taxes and minority interests 345.259 454,419
Depicciaion and aniortization , : 449,318 . 417,886
Impairment loss 52:141 9,946
Amortization of goods ill II 373 _14.275
Gain on negative goodwill (534) (235)
Loss (gain) on .a es of nont.urient assets . '5 (1 280) 06
Loss on retirement of noncurrent assets 15,467 12.964
Incteisi. (decrease) to pioucton for loss, East
I n ) at ihqu ike 16 2S2 ', (14290)
Gain on transfer from business d,vcstitures - (3,615)
I)us idends due tohqtttdmon of ilcnt prinemlup contriet '. (6976)
Increase (decrease) in allowance for doubtful accounts (246) 1,494
I acre ist. (decre ice) in pi ovision for reurt.mem beeflts 40 (36)
Interest and dividends income (2.167) (2.685)
IntLrest t.\PsOScS 14 160 12891
Equity in (earnings) losses of affiliates - 19.948 111,297
I oss (gain) on sales of stocks ofcu1ctdnric ad al1ibtec 176
Loss (gain) on valuation of investment sccurities 368 511
Inctiase (der ics.) in pros Is ton 101 pmt card cerithcatec ft 504 6255
Decrease (increase) in prepaid pension coats 1,586 1,738
Dcrc'tsc (tticrcsc) in prcptd c.penses 1 639) (4 7a4)
Decrease (increase) in notes and accounts receivable-trade (31,377) (207,033)
Dectt.ase (tnt.t'tse) in msentorjec 9344) (6 9453
Increase (decrease) in notcs and accounts Payable-trade () •, . . 23,441
Incre ice(decicase) in ccounts payihk oilier f (12 131) 62003
Increase ((Iecrease) in accrued expenses (799) - 5,014
Itctc Ise (desre tse) inidt nces reOel\ed tv (238) (10 3c6'l
Other. nei (4,210) 508
Subtotal . . . .' ................ 867701 ' .': . .785.247 .................
Interest and dividends income received 7,578 8,761
Jaluesi \PLtiseS p'tid (14 049) (12 882)
Income taxes paid (143,876) (88,625)
laconic taxes refund •.- . S . •• :. . -.' . . . . .. .. 33.386
Net cash piOvidCd by (used in) operating activities 717,353 725.886
-23-
(Amount (Jail: Millions of sea)
Year ended March 31. 2011 Year ended March 31 2012
Net cash provided by (used in) investing activities
Purchase of property, plant and equipnient (346.112) (318,870)
l'urchasc of trust bencl'iciaiy right
Proceeds from sales of property, plant and equipment .535 530
Purchase of inrangibicasseis . (76,045) (75,914)
Purchase of investment securities (1.4)7) (1,961)
Proceeds from sales of mvestmetil securities 15 789 3 424
Payments for business divestitures . . (1000
Purchase of xtoLks 01 subsidiattes aid iflultates (3 890) (25 741)
ruretwse ii, IIivesIIIieiIis III slublutSi te unu all tames
resulting (5.398) (31,788)
Ptoceds Irom purchase ol ,mes(ments in suhstdrsucs and
affiliates resulting in change in s è-ofcbns1idaliott . . :................................................
81 :
Payments for sales of investments in subsidiaries and '904 - affiliates resulting in change in scope of consolidation
Proceeds floni repitnent of msestmcnt nd diyidnds ducto 7 7, 03 ltqLtlthtton oftIent pautncrship contract
Purchase of long-term prepaid expenses (22,398) (26,801)
Other act (I 70) 71
Net cash provided by (used in) investing activities (440,545) (484,507)
NA cash P10% idled by (used in) financing acits tiles
Net increase (decrease) in short-tcrm loans payable (99,714) (I to19)
Prnceulc from long term loans p able 50'000:"
Repayment of long-tents loans payable (24,753) (133,750) .
Proeceds prom issuance of bonds 40 000
Proceeds from issuance of convertible bond-type bonds with - 201:000 subscription rights to shares
Rcdempttoti of bonds (83 000)
Purchase of treasury stock (99,999) (220,969) .:
Casfrdividunds paid •.. , -. -- . : • . : : . ............................... (57,903): . . (63.689)
Cash dividends paid to minority shareholders (1,083) (1,192)
Procceds fTom stoc1 issoatct to mitlot It) shareholders 1 p867 tO
Other, net - (5411) (6,320
Net cash ptos ided b (used in) finnctng 'tctts iitcs (279 998) (225 931)
fffect of exchange rate change on cash and cash equivalents (2,416)
Net incrcase (decrease) in cash-and cash .equivlènis :: : . (5()7) 322
Cash and cash equivalents at beginning of period' 165,476 159.869
Cash and cash cquivalhnis at-end ofierlod. •. . . 159,869 1.74,19.1
-24-
(5)Going Concern Assumption
None
(6)Basis of Presenting Consolidated Financial Statements
1. Scope of consolidation
a) Number of consolidated subsidiaries: 118
h) Major consolidated subsidiarics:
Okinawa Cellular Telephone Company, KDDI Technical & Engineering Service Corporations,
KI)Dl Evolva Inc.Japan ( ablenet Limited. Chubu Tel ecom ill unu.atxons Co Inc
KDDI R&D Laboratories. Inc.. KDDI AMERICA Inc,. KDDI Europe Ltd.,
TF.LEHOUSE International Corp. of America Ltd., Telehouse International Corp. of Europe Ltd.,
KDDI China Corporation, DMX rechnologies Group Limited KDDI KOREA Corporation
KDDI Singapore PLC Ltd.
*KDDI Technical & Engineering Service Corporation-changed its name to KDDI Engineering Corporation on
April 1, 2012.
(Added) 16 companies due to stock acquisition
IIKCOLO. NET Limited. WebMoney Corporation.. Evolva Business Support Inc.,
Nobol Inc.. CDNciworks Co., Ltd. and its 9 subsidiaries, Telehouse Deutschland
GrnhH, Kleyer Real Estate
I company due to additional purchase of owned shares
Japan Internet Exchange Co., Ltd.
3 companies due to new establishment
KKBOX International Limited, TELEHOUSE BEIJING BDA Co., Ltd, KDDI Open
Innovation Fund LI'.
(Removed) 5 companies due to liquidation
KDDI International Holdings, LLC, KDDI International 1-loldings2, LLC,
KDDI International Holdings3, LLC, KDDI Global Media, LP,
Med iaFLO Broadcast Planning Incorporated
'2 companies due to merger
Kawagoe Cable Vision co.. Ltd.: merged by .JCN KANTO LIMITED
KMN Corporation: merged by CABLE TEU'VISION TOKYO, LTD.
C) Special purpose companies
I) Overview of special purpose companies and transactions made through such companies
The Company has securitized real estate in order to improve its financial position by reducing
interest-hearing debt. This securitization was conducted using special purpose companies ("SPCs"),
a particular type of limited liability company.
In this securitization. the Company leased back the real estate that was transferred.
As of November 30, 2011. the Company acquired beneficial interest in trust on land, buildings, etc.,
from Aobadai Estate Y.K., which is a special purpose company. Accompanying this acquisition, the
anonymous association contract as the operator of the related SPC was terminated, and the Company
which was an investor in this association, received dividends accompanying the termination of the
anonymous association contract. The investment in the anonymous association was settled in
December 2011.
-25-
2) Transaction amounts with SPCs during the year coded March 31, 2012
I A flflflhlflh,,lflI 1U ii Iinnc flf ISt1t
Major transaction ainotmis Major income and loss
for the ycar ended March 31
2012 and balance as of betas Amounts
March 31, 2012
Acquiid )ropernes' 14,993 - -
Long-ternt accounts receivable - -
Dividend 654
Investments by anonymous Dividends due to
association liquidation of silent
partnership contract 6,976
Lease transaction - Lease payments 1,112

Note I Transaction amounts related to the acquired properties are represented as the acquisition cost
Note 2: The Company paid rent from April I t 2011 to November 30, 2011 for the year ended March 31.
2012.
2. Equity method affiliate
a)Number of equity method affiliate: 21
b)Major equity method affiliates
Jupiter Telecommunications elecon)muntcations Co.,Ltd.,Kyocera Communication Systems Co Ltd
UQ Communications Inc 1 LPCO OPTICAL NETWORK LNGINLF.RIN(, INC
Jihun Bank Corporation, Mobaoku Co., Ltd., MOBICOM Corporation

(Added) •' 2 companies due to stock acquisition
Branddialog, Inc.. Alliance Internet Co., Ltd.
(Removed) I company due to additional purchase, resulting in subsidiary
Japan Internet Exchange Co., Lid.
c)Non equity method affiliates (CiSC Vostoktelecom etc.) are not included within the scope of the equity
method because they are insignificant and then net incomes and retained earnings (the amounts
equivalent to the Company's interest in the companies) do not significantly affect consolidated financial
statements.
d)ror equity method companies with the fiscal year end that differ from the consolidated fiscal year end
the financial statements for the fiscal year of each company are used
3 Fiscal year of consolidated subsidiaries
Among consolidated subidiancs the fiscal year cod of 74 companies including KDDI AMERICA Inc,
KDDI Europe Ltd.,is December 31 of each year. For the preparation ation of consolidated financial statements
the Company uses financial statements as of December 31 and makes adluslrninls as necessar y for
consolidation in relation to significant transactions during their year-end date and the consolidated year-end
date.
4. Accounting policies
a) \'akiation standards and methods for major assets
1) Securities
Bonds intended to he held to malurity: amortized cost method (straight-line method)
Other securities
a):Other securities for which market quotations are available are stated at thir value prevailing
at the balance sheet date with unrealized gains and losses, directly included in net assets.
The cost of securities sold is determined by the moving-average method.
b):Other securities for which market quotations are not available are valued at cost mainly
determined by the moving-average method.
-26-
2) Inventories
Supplies
Stated at cost. Cost is determined by the moving-average method (the method ot' write-downs
based on the decrease in profitability is applied in order to calculate the inventory value on the
balance shed).
b) Depreciation and amortization for maor assets
I) Property, plant and equipment other than leased assets
The company: Machinery: declining-balance method
Property, plant and equipment other than machinery: straight-line method
Consolidated subsidiaries: Mainly straight-line method
Useful life of principle assets is as follows:
Machinery: 9 years
Antenna facilities, Local line facilities Long-distance Inc facilities Engineering
facilities. Buildings. and Structures: 5 to 38 years
2)Intangible assets other than leased assets: straight-line method
Soñware for internal use is amortized under the straight-line method over the expected useful lives (5
years).
3)Leased assets
Leased assets related to financial leases that do not transfer ownership rights to the lessees are
amortized under the straight-line method based on the lease term as the useful life and residual value
of zero.
Finance leases other than those, which are deemed to transfer the ownership rights of the leased
assets to the lessees, that started before March 31. 2008, are accounted for by a method similar to that
applicable to ordinary operating leases.
4)Long-term prepaid expenses: Straight-line method
c) Deferred assets
Bond issuance expenses: Entire amount of expenses is fully charged at time of expenditure.
d) Significant allowances
1)Allowance for doubtful accounts
To prepare for uncollectible credits, general allowance is recorded based on the actual bad debt ratio,
and specific allowance is recorded based on the amount deemed to the uneolleetible considering the
collectibilily.
2)Provision for retirement benefits
The amount for employee retirement benefits at March 31. 2011 is based on the estimated value of
benefit obligations, plan assets and retirement benefit trust assets at March 31, 2011.
Prior setuce cost is amortized on a straight-line basis over the average remaining service life of
employees (14 years) in the year in which it arises and unrecognized actuarial differences are
amortized on a straight-line basis over the average remaining service life of employees (14 years)
from the year following that in which they arise.
3)Provision for point card certificates
In order to prepare for the future cost generating from the utilization of points that customers have
earned under the point services such as "flu Point Program," based on its past experience, the
Company reserves an amount considered appropriate to cover possible utilization of the points during
or aficr the next consolidated fiscal year.
4)Allowance for bonuses
To allow lbr the payment of bonuses to employees, the company records the standard for estimated
amoitms of bonuses to he paid,
5)Impairment loss on the Great East Japan Earthquake
Amount for recovery of assets damaged by the Great East Japan Earthquake that occurred on March
11. 2011 has been estimated.
-27-
c) Forci tn currency transaction
All nlonelarv assets and liabilities denominated in foreign currencies are translated into Japanese ycn at
the exchange rates prevailing at the balance sheet date. Resulting gains and losses are included in net
profit or loss br the period.
All assets and liabilities of foreign subsidiaries and affiliates are translated into Japanese yen at the
exchange rates prevailing at the balance sheet date. Revenues and expenses for the year are translated
into Japanese yen at the average exchange rate during the year and translation adjustments are included
in Foreign currency translation adjustments" and Minority interests" of 'Net assets."
I) Amortization of goodwill
Goodwill is amortized under the straight-line method over a period of 5 to 20 years. However, minimal
amounts of goodwill is recognized as expenses or gains for the year ended March 31, 2012.
g) Cash and cash equivalents in the consolidated cash flow statements
Cash and cash equivalents are composed of cash on hand, bank deposits able to he withdrawn on
denvtid and short-term highly liquid investments with a maturity of three months or less at the time of
purchase and which bear lower risks float fluctuations in value.
It) Others
Accounting method for consumption taxes
Consumption taxes are accounted for using the net method of reporting.
(7)Changes in Accounting Policies
From the year ended March 31, 2012 : we have applied the "Accounting Standard for Earning Per Share"
(Accounting Standards Board of Japan [ASBJ] Statement No.2 of June 30, 2010), the "Guidance on
Accounting Standard for Earning Per Share" (ASBJ Guidance No.4 of June 30, 2010), and the "Practical
Solution on Accounting for Earnings Per Share (ASS) Pill No .9 of June 30 20 10).
To calculate diluted net income per share, we have changed the method to include potential services offered by
the employees in the fair valuation of stock options of payment when exercising the right regarding stock
options whose rights are secured afier certain period of employment.
Information about the influence of this change is included in the "Per Share Information" section.
(8)Changes in Presentation
(Consolidated Balance Sheets)
Income h\cs tetctahle listed in the year ended Mach 31 2011 has been included n Accounts
receivable-other" as it has become less significant from the year ended Match 31, 2012.
As a result, V32,703 million that was recorded as income taxes receivable on the consolidated balance sheets to
the previous fiscal year has been included in accounts receivable-other.
(9)Changes in Accounting Estimates
Since August 2006, the Company and Okinawa Cellular Telephone Company have offered a service enables
users to carry-over unused talk lime. Ilic service allows a specified amount of the free talk time that is
included in the basic monthly rate to be carried-over indefinitely.
The Company and Okinawa Cellular Telephone Company have estimated the amount of each months unused
free talk time that is expected to be used in the future, deferred the recognition of that amount as revenue, and
recorded that amount in the advances received account. However, from this consolidated fiscal year, a
sufficient quantity of historical results for the estimation of the amount of unused free talk time that is
expected to lapse in the future has been accumulated. and more detailed estimates of that amount have become
possible. Accordingly. the amount of unused free talk time that is expected to lapse in the future is deducted
from the amount of' deferred revenue.
As a result, front this fiscal year. this change has had the effect of increasing revenues from
telecommunications business, operating income, ordinary income, and net income by tI 0,361 million.
(10)Additional Information
(Application of the "Accounting Standard for Accounting Changes and Error Corrections" and others)
For the accounting changes and error corrections made in after the beginning of the year ending March 31,
2012, we have applied the 'Accounting Standard for Accounting Changes and Error Corrections" (ASS)
Statement No.24 of December 4. 2009) and the "Guidance oil Accounting Standard for Accounting Changes
and Error Corrections" (ASI3J Guidance No.24 of b)ecember 4. 2009).
-28
(II) Notes for Consolidated Financial Statements
Consolidated financial statements of the company are prepared under the "Regulations Concerning the terms,
lornis and preparation methods for quarterly consolidated financial statements' (Minist)- of Finance
Ordinance No. 28. 1976. herein alter "Regulations for consolidated financial statements"), and in accordance
with these regulations and the "Rules for telecommunications business accounting" (Ministry of Posts and
Telecommunications Ordinance No. 26, 1985).
(Consolidated Balance Sheets)
Note I: Reduction entry amount of noncurrent assets

As of March 31, 2011 As of March 31,2012
Reduction entry amount due to contribution for construction V. 1 1217M W. I 58M
(cumulative total) \1 8,11 6M Y1 6,862M
Note 2: Notes relating to affiliates
The amounts that relate to subsidiaries and affiliates and that are included in respective items are as
follows.
Stocks of subsidiaries and affiliates
(ofNx--hich investment in jointly controlled en(ities)
Investments in capital ofsubsidiaries and affiliates
Note 3: Contingent liabilities
As of March 31, 2011 As of Maceli 3 1,2012
1i356,887M y351,815M
t659M -Y-687M *1 82M tl85M
As of March 31, 2011 As of March 31, 2012
(I) Guarantor liabilities, etc.
[As a guarantor for loan of.]
UQ Communications Inc. and others V--1 18,873M iit156,935M
(liabilities denominated in foreign currencies included) - KW2,000M
(2)Contingent liabilities existing in cable system supply contract 4,157M Y4.109M
(liabilities denominated in foreign currencies included) U0M US50M
(3)Contingent liabilities resulting front the liquidation of Mmcx 479M Y--377M
Corp. (liabilities denominated in foreign currencies included) USS5M US4M
(4)Contingent liabilities for notes receivable-trade discounted - 297M
(liabilities denominated in foreign currencies included) . US$3M
Note 4: Assets pledged as collateral and liabilities with collateral:
(The Company)
In compliance with the provisions of Article 4 of'the Supplementary Provisions to the Law Concerning
the Rationalization of Regulations in the Telecommunications Field, the total assets of the Company
have been pledged as general collateral for corporate bonds issued.
As of March 31, 2011 As of Maceli 31. 2012
Bonds 20,000M 20.000M
(Consolidated subsidiaries)
In accordance with Article 14, Paragraph I of the Act on Scttletaent of Funds, assets held in trust as
security deposits are as follows.
As ofMarch 31. 2011 As ofMarch 3 1. 2012
Investment securities - -3,005M
Cash and deposits . Y2,000M
-29-
Assets pledged as collateral
As of March 31.2011 As of March 3. 2012
Machinery Y53$M 387M
Local line facilities \470M Y.-319M
Engineering facilities 19M NUM
Subnlarine line facilities l0M V6M
Buildings •l 89M t164M
Other tangible assets VI 12M Y.76M
Investment securities 57 I M W94M
Other investments and other assets Y92M Y171M
Cash and deposits - 877M
Short-tern) investment securities 201M 188M
Total 412,203KI V2,904M
(assets denominated in foreign currencies included) US$IOM US$11 M
Corresponding liabilities
Long-term loans payable .599M Vi t224M
Current portion of noncurrent liabilities M450M 372M
Notes and accounts payable-trade 6M 32M
Short-term loans payable NS1,304M WI.485M
Total 3360M V3,114M
(liabilities denominated in foreign currencies included) US$1 7M US$20M
-30-
(Consolidated Statements of Income)
Note 1: Operating expenses include research and development expenses
Year ended March 33, 2011 Year ended March 31. 2032
Y33.263M y32.85M
Note 2: Gain on sales of noncurrent assets

Year ended March 31, Year ended March 31,
2013 2032
Gain on sales of real estate which accompanied sales of idle land vljosm i.62M
Gain on sales of other facilities WOW V 107M
Total V, 1,3I4M Y 170M
Note 3: Gain on reversal of provision for loss on the Great East Japan Earthquake
Due to reevaluation, etc., of the details and scope of repairs accompanying the progress of on-site
investigations and restoration work on the disaster-stricken region, this estimate has been changed, and
the provision has been reversed in the amount of6,814 million.
Note 4: Loss on sales of noncurrent assets

Year ended March 31, Year ended March 31,
2013 2012
Loss on disposal of real estate accompanying disposal olland, etc. 't597M
Loss on disposal of other titcilities, etc. - )t79M
Total - Y'676M
Note 5: Impairment loss
The Companies mainly recognized impairment loss for the following assets and asset groups.
For the year ended March 31, 2011
Impairment Location Usage for Type
- loss amount
The Company, etc. Telecommunications business Machinery, etc.
Facility used for current 800MHz band 'V13,079M
(Tokyo, Nagoya, Osaka, etc.)
The Company Telecommunications business Local line facilities,
Domestic transmission line facilities, Engineering facilities, fl 7,471 M
idle assets, etc. (Tokyo, etc.) etc.
The Company Telecommunications business Machinery, local line
Facility used for legacy service facilities, etc. 'V21,209M
(Tokyo, etc.)
The Companies calculate impairment losses by grouping assets based on minimum units that have identifiable
cash flows essentially independent from the cash flows of other assets or groups of assets.
The use of the facility for current SOOMllz band will be discontinued from July 2012 due to a reorganization of
frequencies, while transfer of mobile handsets to new frequency band is being promoted. Recognizing the
downward trend in subscribers using handsets compatible with such equipments, the hook value of those assets
was written down to the amount deemed recoverable, resulting in an extraordinary loss on asset impairment of
V.13,079 million. Of which, V.12.373 million comes from machineries and V.705 million from others.
The recoverable value of these assets for the Companies was estimated based on the usage value, and calculated
based on a future cash flow discount rate of 5.54%.
In the year ended March 31 1 2031, for domestic transmission system with declining utilization rates and idle
assets, the book value has been reduced to recoverable value. The said reduction is recognized as impairment
loss of V.17.471 million in extraordinary loss. This consists of V.10,687 million for local line facilities, V.4,485
million for engineering facilities and 'V.2.298 million fbi others.
Further, the recoverable amount lbr the said assets is estimated based on the net selling price. The calculation of
31 -
market value is based on appraised value and other factors, with the value of assets that are difficult to sell or
convert to other uses set at Y0.
Due to the worsening market environment and the downward trend in the subscribers OF a part 01' legacy
services in the Fixed-line Business during the year ended March 31. 201 I t the Company set up a cash
management system for cash flows generated by such equipment, and pooled those assets into an independent
asset gi'ouping.
Recognizing the worsening market environment and the downward trend in the subscribers, the 1)00k value of'
those assets was written down to the amour.t deemed recoverable, resulting in an extraordinary loss on asset
impairment oft21.209 million. Of which. il0.468 million comes for machineries, t7,753 million l'or local line
facilities, and 2,987 million for others.
In addition, impairment loss of" 380 million on business assets in certain subsidiaries was recognized to
extraordinary loss This consists of -Y95 million for long-distance line facilities Y84 million for buildings Y79
million for machinery, '77 million for local line lacilities and Y44 million for others
For the year ended March 31, 2012
Impainneni Location Usage for Type loss amount
The Company Telecommunications Local line facilities,
Domestic transmission line facilities, business Long-distance tine facilities. etc. V,8,515M
idle assets, etc. (Tokyo. etc.)
The Companies calculate impairment losses by grouping assets based on minimum units that have identifiable
cash flows essentially independent from the cash flows of other assets or groups of assets.
In the year titdcd March 31 t 2012 lot domestic transmission system with declining utilization tales and idle
assets the book value has been reduced to recoverable value The said reduction is recognized as impairment
loss of '8 515 million in extraordinary loss This consists of t4 4D4 million lot local line facilities )51,940
million for long-distance line facilities and Y2,119 million for others.
Further, the recoverable amount for the said assets is estimated based on the net selling puce The calculation of
market value is based on appraised value and other factors with the value of assets that are difficult to sell or
convert to other uses set at V0.
In addition impairment loss of t1,431 million on business assets in certain subsidiaries was recognized in
extraordinary loss.
Note 6: l,,oss on retirement of noncurrent assets
Year ended March 31, Year ended March 31,
2011 2012
Facility used for current 800MHz band V28.383M
Facility used for legacy service W1256M
Others 976M
Total I31,816M
Note 7: Loss on the Great East Japan Earthquake
For the year ended March 31, 2011
It is for recovery oI'assets damaged by the Tohoku Region Pacific Coast Earthquake that occurred on March II
2011. It includes loss and recovery cost of au base stations, domestic cable and others t support cost to agencies.
and other recovery costs. It includes-Y-16,282 million in transfer for losses on the Great East Japan Earthquake.
For the year ended March 31, 2012
It includes cost of handset replacement of victims and other recovery cost of the Great East Japan Earthquake
on March 31. 2011.
-32-
(Consolidated Statements of Comprehensive Income)
For the ycar ended March 31, 2012
Amount of recycling and airiount ci' income tax effect associated with oilier comprehensive income
Valuation difference on available-for-sale securities
Amount recognized in the peliod wider review Y6,846M
Amount of recycling Y449M
"Before income tax effect adjustment 7295M
"Amount of income tax effect (104M)
--Valuation difference on available-for-sale securities Y.7.190M
Foreign currency translation adjustment
Amount recognized in the period under review (3,640M)
Amount of recycling -
"Before income tax effect adjustment (3,640M
"Amount of income tax effect -
"Foreign currency translation adjustment (0,640M)
Share of other comprehensive income of associates accounted for using equity method
Amount recognized in the period under review (l .11 tiM)
Amount of recycling 219M
Share of other comprehensive income of
associates accounted for using equity method (98M)
• • Total other comprehensive income Y2.65 I M
-33 -
(Consolidated Statements of Changes in Net Assets)
For the year ended March 31. 2011
I. Total number and type of shares outstanding and total number and type ol treasury stock
As of
March 31. 2010
Increase during the year
ended March 31. 2011
Decrease during the year
ended March 31, 2011
As of
March 31. 2011
Shares outstanding
Common stock 4,484.818 - - 4.484,818
Total 4,4)14,8)8 - - 4,484818
Treasury stock
Common stock' 30.705 208,271 238,976
Total - 30,705 208.271 - 238.976
Note: The increase of208,271 shares in the Company's holdings of its own shares of common stock resulted from the
Company's acquisition of its own shares in accordance with a resolution at a meeting of the Board of Directors held
on October 22. 2010.
2.Subscription warrants and own share option
I Number of shares subject tosubscription Warrants
Increase Decrease Breakdown of Types of shares Balance as of
subscription subject to _ As of during the during the As of March March 3),
warrantq subscription March 3), year ended year ended 31 2011 2011 warrants 2010 March 31, March 31,
2011 2011
The Company Subscription
(parent warrants as stock - 1,4 1 O
company) options
Consolidated Subscription
subsidiaries warrants as stock Y94M
9PtiOiIs
Total . 91,504M
3.Dividends
fri rnch divklenrk nrn,,mnt,
Resolution Type of shares Total dividends Dividends
per share Record date Effective date
June 17, 2010
Annual meeting of Common stuck Y28,951M 6.500 March 31, 2010 June 18, 2010
shareholders
October 22, 2010
Meeting of the Board Common stock V28,951M Y6,500 September 30. 2010 November 19, 2010
of Directors _____________________
(2) Approval of dividends payments for which the record date is in the fiscal year under review and the
effective date is in the fbllnwino vonr is Manned as follows
Resolution Type of shares Total I l _ Dividend Dividends I Record date 1 Effective date dividends I resource pershare
June 16, 2011 I I 1 Annual meeting of Co mmon I t3 1,843M Retained . I I 7,5OQ March 31, 2011 June 17, 2011 I shareholders stock __ earnings _____________________
I t_ _
- 34 -
For the year ended Match 31, 2012
I Total number and type of shares outstanding and total number and type of treasury stock
As of
March 31, 2011
Increase during the year
ended Merdi 31, 20)2
Decrease during the yeni
ended March 31. 2012
As of
March 31. 2012
Shares outstanding
Common stock 4,484,818 - - 4.484818
Total 4.484,818 - - 4,484,818
Treasury stock
Common stock 238,976 424.126 96 663006
Total 238.976 424,126 96 663,006
Note I: the increase 01424,) 26 shares in the Company's holdings of its own shares of common stock resulted from the
Company's acquisition of its Ircasuly stock in accordance with a resolution at a meeting of the Board of l)irectors
held on November 28, 2011.
2: The decrease of 96 shares in the Company's holdings of its own shares of common stock resulted from the exercise
of stock options.
2.Subscription warrants and own stock option
Types of shares Number of shares sub jecu to subscription warrants
Breakdown of subject to Increase during Decrease Balance as of
subscription warrants subscription As of March the year ended during thc year As of March March 31,
31,2011 ended March 31,2012 2012 warrants March31 2012
' 31. 2012
The Company Subscription warrants as
parent stock options - V--1,037M
ompany) Convertible bonds due
2015 convertible
bond-type bonds with Common 348.979 348.979
subscription rights to stock - shares - shares -
shares (Issued on Upper limit Upper limit
December 14, 2011)°
'onsotidated Subscription warrants Subscript ubsidiarics as stock options Y-9
Total - - - 1,128M
Note Convertible bonds clue 2035 convertible bond-type bonds with subscription rights to shares (Issued on December 14,
2011)
I. The number of shares reserved for subscription warrants is the number of shares that would be needed in the
event that stock options were exercised.
2. The increase in the number of shares is due to issuance.
3.Dividends
(I \ ('ash rflv,1en,ic flnun,c.,l1e
Resolution Type of shares Total dividends Dividends
PC share Record date Effective date
June 16, 2011
Annual mcctingof Common stock t3),843M t7,500 March 31. 20)) itirie 17. 2011
- shareholders
October 24, 2011
Meeting ofihe Board Common stock tt31,843M Y7.500 September 30, 2011 November 21, 2011
of Directors
(2) Approval of dividends payments for which the record date is in the fiscal year under review and the
-35 -
elThctive date is in the lhllowino i'isial vtuir Ic olanned as thllows
i I Thitti Dividend Dividends Resolution Type of shares Record date I Meet tvc date dtvjdeuds resource per share
I June 20, 20)2 Common Retained Retainedd Annual meeting of 8.500 March 31. 2012 Itinc 2), 2012
) shareholders stock,
(Consolidated Statenieni of Cash Flows)
Note 1: Relationship between balance of cash and cash equivalents and items presented in consolidated
balance sheet
Year ended March 31, Year ended March 3),
20)) 20)2
Cash and deposits account 4'1 36,92)M 100,037M
Securities account i25.201 M V80,1 88M
Total 44162,123M 180,225M
Time deposit with terms exceeding 3 months and deposits
with collateral (,i2,253M) (06,033M)
Cash and cash equivalents Yl59,869M V174,191M
Note 2: Major assets and liabilities of company that became a consolidated subsidiary through the acquisition of shares
For the year ended March 31, 2011
No significant items to be reported.
For the year ended Match 31, 2012
The breakdown of assets and liabilities at the point when consolidation was initialed due to the consolidation of
WcbMonev Corporation as a result of the acquisition of shares, and the relationship between the amount of the
acquisition of shares and the expenditures for the purpose of the acquisition (net amount), are as follows.
Current assets t17,901M
Noncurrent assets t3,401 M
Goodwill 916,344M
Current liabilities (18.20EM)
Minority interests (86M)
Amount of the acquisition of shares of WebMoney Corporation *19:352M
Cash and case equivalents of WebMoney Corporation (8,440M)
Expenditures lbr the purpose of the acquisition of WebMoncy Corporation r'l0,9l2M
Note 3: In regard to the acquired beneficial interest in trust, accompanying the termination of the real estate
investment trust contract, the ownership of the assets that had been held in trust were transferred to the
Company.
These acquired assets were recorded as follows in the noncurrent assets-teleeommttnieations business
section of the consolidated balance sheets-machinery: Y1,065 million; buildings: .6,125 million;
structures: 97 million; land: t7.697 million; oil-icr tangible OSSCIS: 8 million.
Note 4: Details of major non-cash transactions
Amount of assets and liabilities related in finance lease transactions

Year ended Marc]) 31, Year ended March 31 7
2011 2012
Assets related to finance lease transaction 415672M t5,170M
Liabilities related to finance lease transaction -Y5,959M '5,642M
-36-
(Seginent h ilt)rmnhion)
[Segment Information)
1.Outline of business segments reported
ilie business segments the Companies reports are the business units lbr which the Company is able to obtain
respective financial information separately in order for the Board ol' Directors. etc. to evaluate regularly in
determining how to allocate resources and assess their business performance.
As the Companies is a comprehensive telecommunications company combining mobile and fixed-line
communications in a single company, its business segments reported comprise olhe "Mobile Business" and
the "Fixed-line Business."
The Mobile Business provides mobile services (501cc and data Service) sales of mobil'- phone handsets and
content and other services. The Fixed-Line Business provides various fixed -line communications services.
including broadband services centering in FTTH and CATV access lines, long distance and international
telecommunications services. In addition, the Companies offers data center services and various icr solutions
services outside of Japan.
2.Method of calculating sales and income (loss). identifiable assets, and other items by business segment reported
Accounting method for business segment reported is the same as presentations on "Basis of Presenting
Consolidated Financial Statements."
Income by business segments reported are calculated based on operating income.
lntersegmcnt sales are calculated based on third-party trading prices.
3.information on sales and income (loss), identifiable assets. and other items by business segment reported
For the year ended March 31. 2011
g A Ilnil' K,t,ltinn glf veil)
Mobile Fixed-line Subtotal Others' Total
Eliinina-
tin,, and Consoli-
Business Business dalton
Sales
Outside sales 2.582,366 803,589 3,385,956 1
48,589 3.434,545 - 3,434,545
Interscgmeni sates 8,358 93,661 102,019 65,736 167,756 (167,756)
Total 2,590,724 897.251 3,487,975 114,326 3,602.302 (167,756) 3,434,545
Income by business segment 438.885 23,989 462,875 8,529 471.404 506 471,911
Identifiable assets by business 2,024,393 1,278.619 3,303,012 65.813 3,368,825 410,092 3,778,918 segment
Other items
Depreciation 324,486 124,100 448.587 1,359 449.947 (628) 449,318
Amortization of goodwill 115 11,255 11,371 2 11,373 - 11,373
Investment Inequity-method
affiliates 2.192 336,520 338,712 18,168 356,880 - 356,880
Increase of property, plant and
cquipmcntand intangible assets4 324,248 99.550 423,799 1,215 425:015 6.532 431,548
Notes: I. The "Others" category incorporates operations not included in business segments repoiled. including call center
business, research and technological development, and other operations.
2.
(I) Adjustment of seemeni income (loss) rclèrs in cliniinai ion oiintcrsegmcnl transactions.
(2)Adus(iuents oI'scgnient assets worth Y4) 0,092 million include company-wide assets of 1.568,260 million and
eliminations of presenting company. etc. obligations and eliminations of inter-segment transactions of(' 152,663
million). Ilie majority of these assets arc surplus funds provided to companies, long-term investments and assets
related to administrative divisions.
(3)Increase of property, plant and equipment and intangible assets is Y6,5 312 million mainly from increase in assets
-37-
elated to management and common systems.
3 For depreciation rclatcd to company-wide assets, amounts allocated to each reported segment are 59.474 million for
the Mobile Business and 6.788 million for the Fixed-line Business.
4 This includes long-icon prepaid expenses.
lor the year ended March 31. 2012
[.5 nin;inl unit Mitt innq of vent
Mobile Fixed-line Subtotal Others lotal - -
Dimino-
lion and Consoli-
Business Business dation Corporate2
Sales
Outside sales 2,7]6,864 818,696 3,535560 36.537 31572,098 - 3,572,098
lntersegment sales 10,147 96,840 106,987 70,336 177,324 (177,324)
Total 2727,012 915,536 3,642,548 106,873 3,749,422 (177.324) 3.572,098
Income by business segment 419,190 53,431 472,622 4,298 476,921 726 477,647
identifiable assets by business 2.253.980 1,326,507 3.580,487 71,676 3,652,164 351,844 4004,009 segment
Other items
Depreciation 3.4 302,880 113,715 416,596 1,669 418,265 (379) 417,886
Amortization of noodwili 21629 11,422 14,051 223 14,275 14.275
Investment tocquhtscthod
affiliates 2,527 329,323 331.851 19.969 351,820 - 351,820
Increase of property. plant and 252.853 124,160 377,014 2,422 379,436 8.242 1 387,679
Notes: I. The "Others" category incorporates operations not included in business segments reported, including call center
business, research and technological development, and other operations.
2.
(1)Adjustment of segment income (loss) refers to elimination of intersegment transactions.
(2)Adjustments of segment assets worth V-351,844 million include company -wide assets ofY.515,165 million and
eliminations of presenting company etc obligations and eliminations of Intel segment transactions of('I63,320
million) The makjority of these assets 'ire surplus funds provided to companies, long-term investments and assets
related to administrative divisions.
(3)Increase of property. plaits and equipment and intangible assets is -Y-.8,242 million mainly from increase in assets
related to management and common systems.
3. For depreciation related to company-wide assets, amounts allocated to each reported segment are 7,729 million for
the Mobile Business andY.6,106 million for the Fixed-line Business.
4. This includes long-term prepaid expenses
-38-
( Relative infriation)
For the year ended March 31. 2011
I. Products and services inlhrmatjon
2.Geographic segment information
I) Sales
Sales infonemation by geographic segment is not shown since outside sales in Japan accounted for over 90% of operating
revenue on the consolidated statements of income.
2) Property, plant and equipment
Property, plant and equipment information by geographic segment is not shown since property, plant and equipment in
Japan accounted for over 90% of properly, plant and equipment on the consolidated balance sheets.
3.Information by 111jor clients
Information by major clients is not shown since outside sales for major clients accounted for less 10% ofoperating revenue
on thp consolidated Statements of income.
For the year ended March 31, 2012
I. Products and services infonnation
2. Geographic segment information
1)Sates
Sales information by geographic segment is not shown since outside sales in Japan accounted for over 90% of operating
revenue an the consolidated statements of income.
2)Property, plant and equipment
Property, plant -,aid equipment mnfonnauon by geographic segment is not shown since property, plant and equipment in
Japan accounted for over 90% of property, plant and equipment on the consolidated balance sheets.
3. Information by major clients
Information by major clients is not shown since outside sales for major clients accounted for less 10% of operating revenue
on the consolidated statements of income.
(Information on impairment loss in noncurrent assets by business segment)
For the year ended March 31, 2011
IA n,n,,r, ,,,,ii' t,Aiii ,,r
Mobile Fixed-line Other Corporate Consolidation Business Business Business
lmnpaiimcnt Loss 13.060 38.923 125 30 52,141
For the year ended Match 31, 2012
IA ,fl,,,st iAilii,s,, ,r
Mobile Fixed-line Oilier 1 I corporate Consolidation
Business
Impainnens Loss

Business Business
5 9.941 - 9.946
-39-
(Information on amortization of goodwill and unamortized balance by business segment)
For the year ended March 3 1. 201
I Aiuoiini Hi Millions of veil)
I Mobile Fixed-line Other Consolidation Business Business Business
I A111101-i7nhinnnfgodwifl 115 11.255 2 11,373
IJBalance at end of period 4,249 60,363 - 64,612
For the year ended March 31. 2012
(Aninitni lull t,Aiiiinnc of ven'I
Mobile Fixed-line Other Consolidation Business Business Business
Amortization of goodwill 21629 11,422 223 14,275
Balance at end of period 19.485 72,415 - 91,901
(Information on negative goodwill by business segment)
For the year ended March 31, 2011 and the year ended March 31 1 2012
No significant items to be reported.
(Lease Payment)
(As a lessee)
For the year ended March 31. 2011 and the year ended March 31, 2012
1.Finance leases
No significant items to be reported.
2.Operating leases
No significant items to be reported.
(As a lessor)
For the year ended March 31, 2011 and the year ended March 31, 2012
Finance leases
No significant items to be reported.
40-
(Related Party Transact ion)
fransactiotis with related party
Transactions with the Company and related party
Affiliates of the Company
For the year ended March 31. 2011
fAmruinl Init K4iifloric Of \'Ctt'I
Type Company Head Capital Percentage Relationship Contents of Amount Title of Amount
4s,ne Office Stock for with Related Transaction for Account as of
Possession Party Trans- Match 3),
of Voting action 2011
Rights
Equity- UQ Minato- 23,925 Possession Debit Debit 113700 -
method Comnsuni- ku, Direct guarantee of guaratttee
Receiving 262 Accounts 89 Affiliate cations Inc Tokyo 32.3% loans
warrantee fee receivable-
other
Terms and conditions and policies for terms and conditions
Note: Guarantee amounts for bank borrowings as of year end are shown in the transaction column.
For the year ended March 31, 2012
(Anirninl t'nil Millicinq of vl
Type Company Head Capital Percentage Relationship Cotfletsis of Amount Title of Amount
Name Office Stock for with Related Transaction for Account as of
Possession Party Trans- March 31,
of Voting action 2012
- Rights
Equity- IJQ Minato- 23,925 Possession Debit Debit 156700 - -
method Csmmuai- k. U. Direct guarantee of guamtstee -
Receiving 495 Accounts 132 Affiliate cntiotts Inc. Tokyo 32.3% loans
warrantee fee receivable-
other
Terms and conditions and policies for terms and conditions
Note: Guarantee amounts for hank borrowings as of year end are shown in the transaction column.
-1l -
(Income Taxes)
1.Significant components of deferred tax assets and liabilities Ansount unit: Millions of en)
As oIMarch 31. 2011 As of March 31. 2012
Deferred tax assets
Depreciation and amortization 73.268 41.103
Allowance for doubtful accounts 10,532 9.526
Disposal of fixed assets 1,877 2,253
Inventory write down 2.527 1,267
Impairment loss 40,353 44,622
Reserve for retirement benefits 4,120 4,356
Allowance for bonus payment 8,567 81313
Accrued expenses 2.954 3,007
Net operating loss carried forward 13,186 2,945
Unrealized profits 2,347 2.352
Reserve for point service program 34.5711 34,700
Accrued enterprise taxes 665 101807
Advances received 24,142 20,230
Provision for loss on the Great East Japan Earthquake 5,936 7511
Other 10.693 10,471
Gross deferred tax assets 235.750 196,715
Valuation allowance (17.830) (8,055)
Net deferred tax assets 217r919 188.660
(Deferred sax liabilities)
Special depreciation reserve (1,093) (1 ,696)
Net unrealized gains on securities (19,594) (19,659)
Retained earnings for overseas affiliates (1,270) (1,446)
Accrued enterprise taxes receivable (1,957) -
Gain on transfer from business divestitures - (1,692)
Other (2,360) (4,019)
Total deferred tax liabilities (26,276) (28,513)
Net deferred lax assets 191.643 160,146
2.Summary of significant differences between the statutory tax rate and the Company's effective tax role
As of March 31, 2011 As ofMarch 31,2012
Effective statutory tax sate 40.6% 40.6%
Adjustments:
Permanently non-deductible items including dividend income 0.2 0.1
Inhabitant tax on per capita levy 0.1 0.1
Tax credit for research and development expenses (0.3) (0.2)
Amortization of goodwill 1.3 1.2
Effect of equity-method investment income 2.3 1.6
Pennanemly non-deductible items including dividend income (0.1) (0.2)
Reserve for loss brought forward Valuation allowance (1.0) (0.1)
Valuation allowance (1.9) (1.3)
Effects of tax rate differences for subsidiaries (1.9) (0.2)
Reversal of reserve for tax 04 0.3
Liquidation of subsidiaries (15.7) -
Effect of share exchange - 3.3
Other (0.5) 0.5
Actual tax rate 23.5 45.7
3.Impact from the change in the corporation tax rate. etc.
Due to the promulgation on December 2, 2011, of The Law to Revise the Income Tax, etc., in Order to
Construct a Tax System Addressing Changes in the Socio-Economic Structure (Law No. 114 of 20)1), and The
-42-
Act on Special Measures for Securing the Financial Resources to Implement the Restoration from the Tohoku
Earthquake(Law No.) 17 0)' 201 1). for fiscal years beginning on or slier April 1. 2012, the corporation tax rate
has been reduced and a special reconstruction corporation lax has been instituted. As a result, the effective
statutory lax rate used to measure dclèrred lax assets and liabilities has been changed from the previous 40.6%
to 3.0% for temporary dillerenees expected to be eliminated during the period from the fiscal year beginning
on April 1. 2012 to the fiscal year beginning on April 1. 2014, and to 35.6% for temporary differences
expected to he eliminated in the fiscal year beginning on April 1,2015.
As a result of this tax rate change the amount of deferred tax assets (net of the amount of deferred tax
liabilities) decreased by 12.006 million, valuation difference on available for-sale securities increased by
v.2.762 million, and income taxes-deferred increased by ll4,769 million.
(Financial Instruments)
I. Status of financial instruments
(I) Policy lot measures iclating to financial instruments
In light of p1-ins for .'ipital investment. primarily Cot - conducting telecommunications business the
Lompanies raise the funds it requires es thiou&h bank loans and bonds issuance The Companies manage
temporary fund suipluscs through financial assets that have high levels of safety. Further, the Companies
raise short-term working king capital through bank loans. Regarding derivatives policy, the Companies adhere
to the flindsirnental principle of limiting transactions to those actually required and never conducting
speculative transactions for trading profit.
(2)Details of financial instruments and associated risk and risk management system
Trade receivables—trade notes and accounts receivable and other accounts receivable—are exposed to
credit risk in relation to customets and trading partners. For such risk, pursuant to criteria for managing
credit exposure, the Companies hate systems enabling the management of due dates and balances of each
customer and trading partner as well as the analysis of credit status
The Companies are exposed to market puce fluctuation risk in relation to investment securities However,
those are primarily the slrtucs of companies with which the Companies have operational relationships
and periodic analysis of market values is reported to the Board of Directors.
Almost all trade pSi) 'mbles—tiade notes and accounts payable other accounts payable and accrued
expenses—have payment due dates within one year.
Those trade payables are exposed to liquidity risk at time of settlement. However, the Companies reduce
that risk by having each company review fund-raising plans every month.
Among loans payable, short-term m lo ins payable are primarily for fund raising related to sales transactions
and long-term loans payable are primarily for fund raising related to capital investment and investment
and financing. Loins payable with variable interest rates are exposed to interest tale fluctuation iisk
However, to reduce fluctuation risk for interest payable and fix interest expenses when it enters into
long-term ni loans at variable interest rates—based on the premise that requirements for special treatment of
interest rati. swaps are met in relation to evaluation of the eflcctis eness of hedges—in principle the
(,onip'mnics use interest rate swap ti ins'mciions as 'i hedging method on an individual contract basis
In transaction-related market risk the Group's derivative transactions have the objective of avoiding risks associated
with assets and liabilities on the consolidated balance sheets. With interest rate transactions, there is a risk of interest
rate fluctuations.
Moreover, in regard to credit risk, the colmterpailies to the Group's derivatives transactions are financial institutions
with high degrees of creditworthiness, and accordingly the credit risk of nonfulfillment by a counierparty is
considered to be close to zero.
In order to conduct derivative transactions, based on their company's internal regulations and regulations
stipulating associated details, finance or accounting divisions must receive approval from those with
final-approval authority as stipulated by authority-related regulations through consultation via an internal
memo for each derivative transaction and only conduct transactions with financial institutions with high
credit ratings.
(3)Supplementary explanation of items relating in the market value of financial instruments
The market values of financial products include prices based on market prices, or, if there are no market
prices, they include reasonably estimated prices. Because estimations of the said prices incorporate
fluctuating f'actors, applying different assumptions can in some cases change the said prices.
-43 -
2. Market value of financial instruments
Amounts recognized in the consolidated balance sheet, market values, and the dilThrences are as shown below.
Moreover. items br which it is extremely difficulty to determine market values are not included in the
following table (see (note 2)).
For the \cor nrided Mwc'h 3 1 fl Ii i A ..,.....,,.,,,, eA;iI;,,,,
1300k value Market value DilIcrcnce
I) Cash and deposits 136.921 136921
2)Notes and accounts receivable-trade. 573.508
Allowance for doubtful accounts' (13,767)
559,740 559.740
3)Accounts receivable-other 68.190 68.190
4)Short-term investment securities 25,201 25,201
5)Investment securities
Other securities 69,722 69.722 -
6)Stocks olsubsidinrics and affiliates 332,560 186,823 (145,736) -
Total assets 1,192,337 1,046,600 (145,736)
7)Notes and accounts payable-trade 65,598 65,598 -
8)Short-term loans payable 1,304 1.304
9)Accounts payable-other 192,402 192,402 -
10)Accrued expenses 14.253 14.253 -
II) Income taxes payable 57,764 57,764 -
12)Bonds payable" 414,978 424,976 9,997
13)Long-term loans payable'' 547,436 551.396 3,960 1
Total liabilities 1,293,739 1,307.696 13,957
1. /sJiowancc tor uouutnii accounts reCognizen in notes aim accounts recelvabte-tracte Is oitsel.
Bonds and long-term loans payable included in current p01101) of noncurrent liabilities are included.
Note 1: Calculation of the market value of financial instruments and items relating to short-term investment
securities and derivative transactions
1) Cash and deposits, 2) Notes and accounts receivable-trade. 3) Accounts receivable-other,
4) Short-term Investment securities
Because, the settlement periods of the above items are short and their market values are almost the some
as their book values the relevant book values are used rurther, because the credit risk is extremely
dfflieult to determine on an individual basis 101 notes and accounts receivable-trade. albowance for
douhthil accounts is iegarded as credit risk and the book value is calculated accordingly.
) investment securities, 6) Stock of subsidiaries and affiliates
In relation to the market value of investment securities, for shares the market prices of exchanges are
used.
Fuithu for information on Investment securities categorized according to holding purpose 1)1.1cc see the
note 'Securitics."
7) Notes and accounts payable-trade, 8) Short-term loans payable, 9) Accounts payable-other, 10)
Accrued expenses. II) Income taxes payable
Because the settlement periods of the above items are short and their market values are almost the same
as their book values, the relevant book values are used.
I 2) Bonds payable. 13) Long-term loans payable
The market value of bonds payable is calculated based on trading reference data.
The market value of long-term loans payable is calculated by applying a discount rate to the total of
principal and interest. That discount rate is based on the assumed interest rate if a similar new loan was
entered 11110. Because long-leon loans payable with variable ifltcrC5t rates ore based on the condition that
interest rates are revised periodically, their market values are almost the same as their 1)00k values, the
relevant book values are used.
Note 2: Financial instruments for which it is extremely difficulty to determine market value
Book value
Investment securities
Unlisted equity Securities 4,176
Stocks of subsidiaries and affiliates
Unlisted equity securities 21,327
[esiients in capital olsubsidiaries and affiliates 182
-44 -
l3cmse it is recognized that these do not have market values and that the market values are extremely difficult to
determine. they are not included in the chart above.
Note 3: Planned redemption amounts ai)er the balance sheet date for monetary assets and short-term investment
securities with monetary assets and maturity dates
4Oti,,n nC ,,,.,,
Within 1 year Over I year
Cash and deposits 136.921
Notes and accounts receivable-trade 532,505 41.002
Accounts receivable-other 68030 158
Securities 25.201 -
Total 762,659 41,161
Note 4: Planned repayment amounts afier the balance sheet date for bonds payable, long-term loans payable
IA,,-,,.,,j ,,.,t hA i.,,, nC,,,,I
Within I year Over 1 year
Bonds payable
Long-term loans payable
-
133,248
415,000
414,187
Total 133.248 J 829,187 I
For the veer ended Mei'li ' 1 A I') IA rnnuni ,ti t1ittir,n nf'en't
Book value Market value Difference
1)Cash and deposits 100.037 100,037 -
2)Notes and accounts receivable-trade 760,890
Allowance for doubtful accounts' (14.960)
745,929 745,929 -
3)Accounts receivable-other 66.286 66,286 -
4)Short-term investment securities 80.188 80,188 -
5)Investment securities
Bonds intended to be held to maturity 3,005 3,137 132
Other securities 72,374 72,374 -
6)Stocks of subsidiaries and affiliates 326,297 189,567 (136,729)
Total assets 1:394,118 1257 2I (136 597)
7)Notes and accounts payable-trade 90.661 90,661 -
8)Short-term loans payable 1,486 1.486 -
9)Accounts payable-other 273,119 2732 119 -
10)Accrued expenses 20.370 20,370 -
II) Income taxes payable 149,773 149,773 -
12)Bonds payable 414.9811 427.727 12,738
13)Convertible bond-type bonds with
subscription rights to shares 2001916 214,500 13,583
14)Long-term loans payable' 414,163 419.340 5,176
Total liabilities I 56 41>0 1,596 979 31,498
i:Allowance br doubtful accounts recognized in notes and accounts recctvable-trade is onset.
ii:Bonds and long-tents loans payable included in cuiTent portion ofnonetment liabilities are included.
Note 1: Calculation of the market value of financial instruments and items relating to short-term investment
securities and derivative transactions
1) Cash and deposits. 2) Notes and accounts receivable-trade, 3) Accounts receivable-other,
4)Short-term investment securities
Because, the settlement periods of the above items are short and their market values are almost the
same as their hook salues, the relevant book values are used. Further, because the credit risk is
extremely difficult to determine on an individual basis for notes and accounts receivable-trade,
allowance for doubtfttl accounts is regarded as credit risk and the book value is calculated accordingly.
5)Investment securities, 6) Stock of subsidiaries and affiliates
In relation to the market value of investment securities, for shares the market prices of exchanges are
used.
Further, for information on investment securities categorized according to holding purpose, please see
- 45 -
the note Sccurilies."
7) Notes and accounts payable-trade. 8) Short-term loans payable. 9) Accounts payable-other,
10) Accrued expenses. II) Income taxes payable
Because the settlement periods of the above items are short and their market values are almost the
Same as their book values, the relevant book values are used.
12) Bonds payable. 13) Convertible bond-type bonds with subscription rights to shares, 14) Long-term
loans payable
'the market value of bonds payable and convertible bond-type bonds with subscription rights to shares
are calculated based on trading reference data.
The market value of long-term loans payable is calculated by applying a discount rate to the total of
principal and interest. That discount rate is based on the assumed interest rate if a similar new loan was
entered into Because long-term m loins payable with variable interest rates are based on the condition
that interest rates are revised periodically, their market values are almost the same as their book values.
the relevant book values are used.
Note 2: Financial instruments for which it is extremely difficulty to determine market value
(Amount unit: Millions of yen)
1300k value
Investment securities
Unlisted equity securities 11,234
Stocks of subsidiaries and affiliates
Unlisted equity securities 25,517
Investments in capital ofsubsidiaries and affiliates 185
Because it is recognized that these do not have market values and that the market values are extremely difficult to
determine, they are not included in the chart above.
Note 3 Planned redemption amounts after the balance sheet date for monetary assets and short-term investment
securities with monetary assets and maturity dates
IA --t nnip KAiliinnc ,,rusn'
Within 1 year Over I year
Cash and deposits 100,037 -
Notes and accounts receivable-trade 653,343 107,546
Accounts receivable-oIlier 66,281 5
Securities 80,000 -
Investment securities - 3,()05
-Total 899,662 1 110,557
Note 4: Planned repayment amounts after the balance sheet date for bonds payable, long-term loans payable
(A,.,tnn,t i,n K,tilhinnc nfu,'n\
Within I year Over I year
Bonds Payable 65,000 350,000
Convertible bond-type bonds with subscription rights to shares - 200,000
Long-term loans payable 112,877 301,286
Total 177.877 851,286
-46-
(Securhies)
I. J)oiiils intended to be liekl to maturity
For the year ended March 31. 2011
None
For the year ended March 31. 2012
(Afl•Sfl•f
Types Book value Actual values Unrealized
Gaits/toss
(1)National bonds and
Ronds for which market local bonds, etc. 3,005 3.137 (132)
value exceeds book value on (2)Bonds payable - -
consolidated balance sheets (3)Others - -
Subtotal 3,005 3.137 (132)
(])National bonds and Bonds for which market
value does not exceed hook local bonds. etc. - - -
(2)Bonds payable value on consolidated
balance sheets (3)Others
Subtotal -
Total 3,005 3,137 (132)
2. Oilier securities
Por ih v,'ttr 'ndsvl Mrk ii Will I A ..,,,,.,,,,.,, 1,A.11,,,.S..
Types Book value Acquisition
cost
Unrealized
Gam/loss
(l)Stock 52,495 3376 49,118
(2)Bonds
Securities (hr which book i National bonds and
value of consolidated local bonds, etc. - - -
balance sheets exceeds ii Bonds payable • - -
acquisition cost iii Others - - -
(3)Others 250 228 21
Subtotal 52,745 3.604 49,140
())Stock 17,017 17,857 (839)
(2)Bonds
Securities for which book i National bonds and
value of consolidated local bonds, etc. - . -
balance sheets does not ii Bonds payable -
exceed acquisition cost iii Others 25.000 25,000 -
(3)011)ers 160 - 174 (13)
Subtotal 42,178 43.032 (853)
Total 94,923 46.636 48,287
Note: necause 015 recognized sitar these (to not have market values and that the market values are extremely dulliclilt
in determine, unlisted equity securities (Consolidation 'Y4, 176 million' ' is not included in the chart above.
-47-
Pn, ih' ',i hA ,,rr't, I I )ii I) IA ,.,'
- Unrealized I Book value Acquisition COSt Gain/loss
(1)Stock 71.627 3.109 6811
(2)Bonds Securities for 'itCh I National bonds and book value of -
local bonds. etc. - consolidated balance -
Ii Bonds payable - sheets exceeds -
iii Others acquisition cost 3)0the
Subtotal 71,666 3.544 68.122
(1 )Stoek 852 2,770 (1,917)
(2)Bonds Securities for which i National bonds and book value of -
local bonds, etc. - consolidated balance -
ii Bonds payable - sheets does not exceed -
iii Others acquisition (3)Others 0 042 80.046 (4)
Subtotal 80,895 82.817 (1,921)
Total 1 52.562 86,361 66.200
Note: ieeause it is recognlzea that these do not have market values and that the market vatueS are extremely ailticuit LO
determine, unlisted equity securities (Consolidation I 1,234 million- - is not included in the chart above.
3.Other sec' Urilies sold
1rIr it,,- ,,,-,,r ,-,s,i,-,i A,,,-,-t, it rn t IA ,,,,,.,,L ,,,L. hAj1in, s,i
L Type Amount of sale
Stock 15,717
Total gain on sale -
Tot!ff]

5,690
Fnr flip ,,I-w ,n,1,-,1 KArn-,.i, 'ii ')AV) IA --.1 -,;1 hAil) sl\,,n'i
Type Amount of sale Total gain on sale Total loss on sale
L Stock 3,986 1 137 89
4.1 mpmrmcnt of investment securities
For the year ended March 31, 2011, the Companies recognized an impairment ofi368 million on
investment securities (other securities) For the year ended March 31, 2012 the companies recognl7ed an
impairment of V-509 million on investment securities (other securities),
Further, regarding impairment treatment, for securities for which market value at the end of the period had
dropped markedly in comparison to acquisition cost, impairment treatment was undertaken for the amount
recognized as required in light of the possibility of recovery.
-48-
(Derivatives)
Market value of transactions
For the year ended March 31. 2011 and the year ended March 31. 2012
No significant hcnis to he reported.
-49-
(Stock Options)
For the year ended March 3), 2011
1. Deals and scale of the stock option granted and changes in the scale
(1) Details of the stock option granted
Company name T KDDI Corporation
August 2007 August 2008 ALIgUCI 2009 d Stock Option l Stock Option 9u Stock Option
Category and number of
grantees
Members of the Board 8 8 7
Vice Presidents 19 IS t8
Executive Directors 25 29 32
Employees 2,794 2,996 2.951
Directors of wholly
owned subsidiaries tO 5 7
Type and number of stock Common stock Common stock Common stock
5,008 51106 5,189
Dale ofgrant August I 0, 2007 August 8, 2008 August 10, 2009
I) The grantee of stack options must be, at the time t) The grantee of stock options must be, at the
of exercise of options a director, vice president, time of esercise of options a director, vice
executive director. senior advisor, auditor or president, executive director, senior
employee of the Company and/or its advisor, auditor or employee of the
ctibstdtanes liossever, when there are Company and/at its subsidiaries. However,
appropriate grounds, such as resignation due to svheti there are appropriate gncstmdi, such as
completion of term of office or reaching the age resignation due to completion of term of
at retirement it will be permuted for the grantee office or reaching the age of retirement, it
to exercise on these options wtltitn six months from will be permitted for the grantee to exercise
the stall of the applicable-period or resignation these options within etc months from the
or retirement whichever is later, provided the start of the applicable-period at resignation
exercise period is not esceeded or retirement, whichever is later, provided
2)In the event of the derub of a stock option the exercise period is not exceeded.
Vesting conditions grantee, his or her heirs may, within six months )) to the event of the death of a stock option
from the dale of death (until the expiration of the grantee, his or her heirs may within act
exercise period), exercise the options for up to months from the date of death (until the
the niaxitnttns number of shares of stock expiration of the exercise period), exercise
available as of the time of death, the options for tip to the tnaxinsuns number
3)In special cases svttcrc it is permitted by the of shares of stock available as of the time
Company's Stock Option Committee, the grantee of death,
of stock options may exercise their options under 3) In special cases where it is permitted by the
conditions different from those described in I) Company's Stock Option Committee. the
and 2). grantee of stock options may exercise their
4)Other conditions are set forth in the contract options under conditions different from
concerning the grant of subscription warrants those described in 1) and 2).
toads between the Company and the grantee of
stock options, based on the resolution of the
titeetitie of the Board of Directors.
Vesting period From August hO, 2007 f August 8, 2008 Attgttat 10, 2009
To September 30.2009 September 30,2010 September 30,2011
Exercisecrio' From p October 1, 2009 October 1, 2010 October 1, 2011
To September 30,2011 1 September 30. 2012 September 30, 2013
-50-
Company same T2MX Technologies Group Limited
October 2003 April 2008 November 2008
Stock Option Stock Option Stock Option
Crrtcgorc and nrinsiwr ni gratitees
5 4 6
Members of the I3osi-rJ
Employees 56 13 _________
Type and ,rtrtrrber of stock crested Common stock Common stuck Common stock
10,220,000 18.000,000 20.000,000
Date of grant October 3, 2003 April 25, 2008 November 28, 2008
I) Based on the condition of beints a director or employee of DMX Technology Group Limited or
Vesting conditions its group, rights of 50% are vested one s'ear and two years respectively after the date of grant.
2) Other conditions are pursuant to the stork acquisition rights regulations of DMX Thchnologica
Group _Limited.
Vesting period From
To There are no regulations concerning vesting periods. ________________________
Front Exercise period October 2,201N April 24, 2009 I Ncrvcmbcr 27, 2009
To May 26, 2013 I April 26. 2018 $ November 28, 2018
Note: Stork options have been converted into equivalent numbers of shares and presented accordingly.
Company ttattse Wire and Wireless Co., Lid.
December 2010
l Stock Option
Category and suttabet of grantees
Members of the Board 2
Employees 20
Shareholders 2
Type and number of stork granted Common stock
Date of grant December 1. 20 10
(1)In the event that the party towhom new chain subscription rights have been allocated
(hereinafter, "Grantee of New Share Subscription Rights") is a director at employee of Party
A said party must also bold a positron as dureclor, auditor or employee of Party A or its
',ubstdtas) at the (tine these nhts are exercised However, this restriction is lifted when there
are appropriate grounds, such as resignation due to completion of term of office or reaching the
age of retiretoent, upon approval by the Board of Directors of Party A.
(2)In the event of Party 13's death in the period chtrittg which these new share acquisition rights
may be exercised, his or her heirs may not exercise (Isaac new share subscription rights.
However, this restriction is lifted if the heirs have received Board of Directors approval in
advance of their attempt to exercise new share subscription rights.
(3)'flrese new share subscription rights may not he transferred, pledged or otherwise disposed of.
Vesting conditions
(4)Conditions for applying ma exemption measures under Article 29-2 of the Act on Special
Measurer Concerning Taxation to new share subscription rights received are as follows.
(i)The total amount paid is exchange for the exercise of new share subscription rights may not
exceed 12 million dutiug a one-year period.
(ii)Shares acquired in exchange for the exercise of new share subscription rights shall be recorded
via Patty A in the transfer account ledger (the transfer account ledger legally prescribed for the
transfer of bonds, shares, etc.; the Santa applies below) of tire financial itsenruascttls business
operator specified by Party A or the legally prescribed financial institution (lretxitrsfler,
'Specified Fittanrial Instruments Business Operator"), or such recording shall he received or
held in trust an the sales tslIice or business office of the Specified Financial Instruments
Business Operator or similar or the shares shall he held in trust.
Vesting period From
To There are no regulations concerning vesting periods.
Ecencieen ad From p December 1. 2011
October 29, 2019
Note: Stock options have been converted into equivalent usunrlsers of shares and presented accordingly.
-51-
(2) Scale of stock options and changes in the scale
The kllow,t lists the number of shares calculated for the number of stock options that existed in the year ended
March 31. 2012
11 Number of stock Ofltlfl"S
Company name KDDI Corporation
August 2007 August 2008 August 2009
6'' Stock Option 7th Stock Option glI Stock Option
Before vested
Beginning of period - 5,146
Granted - - -
Forfeited - - 19
Vested - - 5.127
(invested - -
After vested
Beginning of period 4.558 4.805 -
Vested - 5,127
Exercised - 2 94
Expired 4,558 145 173
Exercisable - 4,658 4.860
Company name DMX Technologies Group Limited
October 2003 April 2008 November 200$
Stock Option Stock Option Stock Option
Before vested
Beginning of period - - -
Granted
Forfeited - - -
Vested - - -
linvested - -
After vested
Beginningofpetiod 3.305.544 3,906,858 16,930,000
Vested - - -
Exercised - 10,000 1,710,000
Expired - -
Exercisable 3,305,544 3,896,858 15,220,000
Company name Wire and Wireless Co., Ltd.
December 2010
I" Stock Option
Be fore vested
Beginning of period 1,402
Granted -
Forfeited 45
Vested
Unvested 1357
A tier vested
Beginning of period -
Vested
Exercised
Expired -
Exercisable -
-52-
2) Unit value
Contpanv name KDDI Corporation - -
August 2007 August 2008 August 2009 6th Stock Option 71h Stock Option 8th Stock Option
Exercise price •\t979.000 t649.000 539,000
Average share price - - -
at exercise - Y29.O0
Fair value unit price
(Date ofgrant) V10049 Yl06,718 tl 11,281
Company name DMX Technologies Group Limited
October 2003 April 2008 November 2008
Stock Option Stock Option Stock Option -
Exercise price SOD 0.6778 - SOD0.2260 SOD 0.0930
Average share price SOD 03150 SOD 0.3150 at exercise
Fair value unit price
(Date ofEant) SOD 0.7900 SOD 0.2500 SOD 0.0900
Company name WireandWirelessCo.,Ltd.
December 2010
I" Stock Option
Exercise price 24.000
Average share price
-it exercise
Fair value unit price
(Date ofgrant)
-
2.Method of estimating reasonable price for share options
Consolidated subsidiary Wire & Wireless Co.. Ltd., is an unlisted company, and consequently the
reasonable price of the December 2011 No I share options of Wire & Wireless is calculated by estimating
the intrinsic value The stock valuation method that is the basis of this intrinsic value estimate is method to
which decisions are made with reference to the price calculated in accordance with the discounted cash fibs;
method. The total intrinsic value at the end of the consolidated fiscal year, with calculations based on the
intrinsic value of the share Options, Is go.
3.Method of cstimatirig, number of options vested
The number of options vested was calculated by estimating the number of expirations due to unvested
options, based on the retirement rate in the year ended March 31, 2012.
4.Amount and classification olexpenses
.-..,.
Year ended March 31, Year ended March 31,
2011 2012
Operating loss from telecommunications
-
Business expenses 156 51
Administrative expenses 109 41
Others 105 33 -
Total 371 126
Operating loss from incidental business 31
-
5 -
Total 31 5
Amountof expenses 402
-
- 131
5.Amount recorded as income from the nullification of rights following non-exercise
I ,,s ,,.,iI tuIiilin.,
Year ended March 31, Year ended March 31.
2011 2012
Gain on reversal of subscription rights toshares 450
-
- 493
- 53 -
(Business Combination)
For the year ended March 31. 2012
Business Combination due in acquisition
I. Overview of business combination
(1)Name of acquired company WebMoney Coqoration
(2)Business activities of acquired company Issuance and sale of server-managed electronic money
(3)Main reason for the business combination Targeting the realization olmultiple uses under the 3M strategy
(Multi-Use, Multi-Network. Multi-Device), the Company
acquired shares ol'WebMonev and made it a consolidated
subsidiary in order to enhance the settlement platform.
(4)Dale of business combination July 19, 2011 (Dale of commencement of T013 settlement)
(5)Legal fonit of business combination Acquisition of shares
(6)Name of company after business combination WebMoney Corporation
(7)% of voting rights acquired 97.2%
(8)Main factors in determination of acquirer Because the type of consideration was cash, the Company, which
provided the cash, was determined to be the acquirer.
2.Period for which the acquired company's results are included in the consolidated statements of income under
review
July 1, 2011, was deemed to be the acquisition date, and accordingly results for the period from July 1, 2011 1
lo March 3I, 2012, were included.
3.Acquired company acquisition cost: amount and breakdown
Consideration for acquisition V19,1 03M
Costs directly incurred for acquisition tt248M
Acquisition cost V19.352M
4. Amount of goodwill recognized, basis for recognition of goodwill. method and period for amortization of
goodwill
(I) Amount of goodwill V-1 6,344M
(2)Basis for recognition of goodwill Additional future earnings capacity expected as a result of future
operational dcvclopnient by the acquired company.
(3)Method and period for amortization of goodwill Straight-line amortization over a period of 13 years.
5. Amounts and breakdown for assets acquired and liabilities assumed in the business combination
Noncurrent, assets Y3,101M
Current assets t 17,901 M
Total assets 2 I 302M
Current liabilities 18,208M
Total liabilities q8.208M
6. Approximate amount of the effect on the consolidated statements of income for the fiscal year assuming that
the business combination had been completed at the beginning of the fiscal year.
The approximate amount of the effect has been omitted because it is not material.
-54-
(Asset Retirement Obligations)
For the year ended March 31, 2011 and the year ended March 31, 2012
No significant ilciis to be reported.
(Estate Leases)
For the year ended March 31. 2011 and the year ended March 31, 2012
No significant items to be reported.
-55-
(Per Share In lormation. etc.)
I Per share informat ion]
Year ended March 31 2011 Year ended March 31. 2012
Net assets per share 495,386.23 Y539.206.73
Net laconic per share 58,149.78 Y,58,1 15.98
Diluted net income per share Not aiven as the Company has 56,668.91
no potential stocks with dilution
effect
Note: The Ibilowing shows the basis of calculating net income per share.
Year ended March 31. 2011 Year cnded March 31.2012
Net income per share
Net income for the fiscal year i(255, 122M V-238.604M
Monetaryvalue not related to common -
stockholders
Net income related to common stock V255.122M 238.604M
Number of weighted average common shares 4.387.331 4.105,665 - outstanding during the fiscal year (shares)
Diluted Net Income per Share
Adiustmetn of net tncome for the fiscal year (Y49M)
Amortization of bond premium (after deduction of
- O'-49M) an amount equivalent to tax)*
Increase in number of shares of common stock - 103.967
(subscription warrants) - 37
(Convertible bond-type bonds with subscription
- 103 930 rights to shares)
Three types of subscription One type of subscription
warrant warrant
-August 2007, 6th Stock Option -August 2008, 7111 Stock Option
Overview vict of potential stock not included in (4.558 subscription warrants) (4 658 subscription warrants)
calculation of diluted net income per share because -August 2008, 7th Stock Option the stock have no dilution effect (4.805 subscription warrants)
-August 2009, 8th Stock Option
(5.146 subscription warrants)
* This is the amount ofamortizatioii for the fiscal year (after deducting an amount equivalent to lax) of the premium resulting
from the issuance of the bonds at an amount higher than the face amount.
(Changes in Accounting Policies)
From the year ended March 31, 2012. we have applied the "Accounting Standard for Earning Per Share"
(Accounting Standards Board of Japan FASI3.1] Statement No.2 of June 30, 2010), the "Guidance on Accounting
Standard for Earning Per Share" (ASI3J Guidance No.4 of June 30, 2010), and the "Practical Solution on
Accounting for Earnings Per Share" (ASBJ PITF No.9 of June 30. 2010).
To calculate diluted net income per share, we have changed the method to include potential services offered by
the employees in the fair valuation of stock options of payment when exercising the right regarding stock options
whose tights are secured after certain period of employment.
If this accounting standard, etc., had not been applied, there would be no impact on the calculation of net assets
per share, net income per share, and diluted net income per share in the previous consolidated fiscal year.
-56-
(Significant Subsequent Event)
(Notice Concerning Share Split and Adoption System)
The Company resolved at the meeting of the Board of Directors held on April 25. 2012 concerning share split
and adoption of share-trading-unit system. The details are as follows.
1. Purpose of Share Split. Adoption ofShare-Trading-Unit System. and Partial Changes to Articles of
Incorporation
Taking into consideration the intent of the 'Action Plan for Consolidating 'trading Units" that was announced
by all domestic stock exchanges of Japan in November 2007. the Company will conduct a 1:100 share split
and adopt a share-trading-unit system to contribute towards improving the convenience and liquidity of the
Securities market that the Company's stock is listed. Please note that the number of investment units will not
actually change following the implementation of the share Split and the adoption of the share-trading-unit
system.
2. Share Split
(I) Method of share split
The share split shall have a record date of Sunday, September 30. 2012 (because this date falls on a
holiday, for all practical purposes the date in substance is Friday, September 28, 2012) and shall involve
the splitting of eonttiion shares held by shareholders whose names appear or are recorded in the latest
Registry of Shareholders on the record date at a ratio of 1:100.
(2) Number of increase in shares by share split
Number of increase in shares by share split shall be 99 times the final total number of issued shares on
Sunday. September 30, 2012. The numbers of shares presented below are based on the total number of
issued shares on Wednesday, April 25, 2012.
I) Total number of issued shares before share split 4,484,8 18 shares
2)Number of increase in shares by share split 443,996,982 shires
3)Total number of issued shares after share split 448.481,800 shares
4)Total number of authorized shares after share split 700.000.000 shares
(3) Schedule of share split
I) Public notice date of the record date Friday, September 14. 2012
2)Record date Sunday.. September 30, 2012
* For all practical purposes the record date in substance is Friday, September 28, 2012.
3)Effective date Monday. October 1, 2012
3. Adoption of Share-Trading-Unit System
(1)Number of shares in newly established share-trading unit
The adoption of the share-trading-unit system shall take effect on the effective date stated in "2. Share
Split" above and the number of shares to constitute a share-trading unit shall he IOU shares.
(2)Schedule for establishment of the new system
Effective date Monday. October 1,2012
Note; Effective September 26, 2012. the share-trading unit for the Company's shares shall be changed
to 100 shares on the securities exchange.
4. Others
Per share information based on the assumption that this stock split had been implemented at the beginning of
the previous period is presented as follows for the previous consolidation fiscal year and the consolidated
fiscal year under review.
Total net assets per share
As of March 31. 2011 V4.953.86
As of March 31, 2012 5,392.07
Net income per share
As ofMareh 31, 2011 581.50
AsofMarch3l,2012 Y581.16
Diluted net income per share
As of March 31. 2011 -
As of March 31, 2012 ti566.69
-57-
5. Financial Statements
(I) Balance Sheets
(Amount unit: Millions ofycn)
As olMarch 31. 2011 As ofMarch 31. 2012
Assets
Noncurrent assets
Noncurrem asscts-teleeommunications business 7.
Propetly. plant and equipment
Mlchmet3 21,592.'304 2 69t 628
Accumulated depreciation (1,983,895) (2,131.133)
MoChmer net -. 60 498 562 495
Antenna facilities 584,749 613,706
Accumulited clepreci ilion a (236 886) (271 68)
Antenna facilities, net 347,863 342.137
tialfabilities:..... s . .' : . .. ..
. 248
Accumulated depreciation (9,461) (8,297)
Local line facilities . 182,499 191,884
Auumul ited depicu ttu,n ., (12% 650) 1130 713)
Local line facilities, net 58,849 61,171
1 otsg distancitnc lacilitics 103 369 101 0i
Accumulated depreciation (93,627) (95,773)
Long-distance line .faeiitties;net .:
. :. . .: s. S......941: j.... . .: :.. :5,284
Engineering facilities 61,319 . 61,479
Accumuldtcd dcpreu'itton (35 977j 37 95)
Engineering facilities, net 25.341 23,883
Submnttse line factlnies '' "1 5704) 54 328
Accumulated depreciation . (46.747) (47,138)
Subm Irine Ime PIcihtLcs net ' 10 294 7 190
Buildings . . . . . . 402,291 406,580
Aceumulie.d dcpruiaUon 0 097 927) (210573)
Buildings. net 204,363 196,007
Structures 76 907 iS 068
Accumulated depreciation (45,099) (47,704)
Struuwes net 31807 3064
Machinary and equipment 11,654 11,635
rr Acuimul tied &prect thon (II 000) (11 341)
Mchinary and equipment, net 654 293
Vehicles 1 064 1 054
Accumulated depreciation (550) (694)
\'ehu.ILs tjet 503 360
Tools, furniture and fixtures 75,721 79,216
lAceumulatec! kPreciàtio . : ,: . . ............... (51.9U) . •: . (57,660)
Fools, furnitures and fixtures, net 2309 21.556
L mc) 2j9 900 24C 942
Lease assets 4,829 4,829
Accumulated depreciation (2,623)
Lease assets, net 2,206 996
Construction in progres . .. . . ............................ S .............: 71,.097.. .. 126,237
Total propert.y t plant and equipment 1.638,018 1 1627.746
-58-
(A mount unit Millions uf )'en)
As of March 31. 2011 As of March31. 2012
Intangible assets . .
Right of using submarine line facilities 4,53
Right ofisingThcilities .. " 1 .1 8,988 10A57.
Software 190,819 173,835
12,182 . . 7.7$2
Patent sight I
,Lease b9Ia right , l420.
Other intangible assets .. . 2,348 2,297
mini intangible nsset 220 304 200 720
Total noncurrent assets-telecommunications business 1.858,323 1,828.467
Inudental busucss fact1itie' - r
Prorty, plant and equipment
PropertY plant and equ1pnnt 14 700 25J 02
Accumulated depreciation (9,316) (10,180)
-. :. . •. Properiyithatsthd:e

Total property. Want and 5,384 14,921
7.076
'..: ' ' .•''.::251
Investments and other assets
Investment ,eeurit1es 72 948 82 939
Stocks of subsidiaries and affiliates . 524,429 590,620 ,
lnycslmnts In capital 1 025 434
Investments in capital of subsidiaries and affiliates 1,658
Lo3lg Leon loans rce able 2]0 208
Long-tern loans receivable from subsidiaries and affiliates 68,462 44,270
Long tenu prepid expellses 81 447 90 20
Deferred lax assets 123,832 99,0
Other mveslmenl in other assets 11 41 560 40 576
Allowance for doubtful accounts (7,765) (8,772), ,
TOtal un.cstmenls and other assets 907 8 IL) 945 210
Total noncurrent assets , 2,778,595 2,799,229
Cut rent assets
Cash and deposits . 112,633 55,257
Notes teLe1-tble trade 29 10
Accounts receivable-trade 707,175 ,
At.cpunis receivable other 2(i 661 39677
Income taxes receivable 32,691 - ,
Short tcrm investoicut ',etirntes 25 000 80 000
Supplies , 54,100 61,018 . , .
Prepaid-expenses II 060 12;253
Deferred tax assets 54,703 , 50,986
Short 1mm loans receivsbk to substdiarii_s and affiliates 30643 56 071
Other current assets , 3.343 3,454
Allouancc fqr doubtful scoupts (12 693) (13,266)-.:,:
Total current assets . 865.735 1,052,662
'Total assets. ••'. .': ' •' ' " . . ... , . ... . ..' . .3,o44,3$o.............. .• . 3851;89l.
59 -
(Arnoui)t Unit: Millions or yen)
As olMaich SI. 2011 As olMareb 31, 2012
Liabilities • . • .: : • . • • .
Noncurrent liabilities
0 13Oithi)wabk ,: • • . • . 414,9711 • 349,991 •
Con'ertibe bond-type bonds with subscription rights to shares - 200,916
Long-tern Ioanpayable • .. ' : . • 0 407,311 • • • . . 297;5 I 7
Lease obligations 1,046 . 206
- I'rovjsio n for rstJrejjit belsefils 15,697: 15 571
Provision for point card certificates . 83,446 89,677
Provsson Ibi watxant,e for cornplelcd (.onslruuIon . 732 . 2 69
Asset retirement obligations 1,955 1,865 .... E::.,......... ii : 4 ... . .. . . .

Other noncun nt Jb,lties , ,.
. ....... ,.. . 35 907 33 62
Total noncurrent liabilities 964,075 993,967
Current liabilities 77 37
1
Current portion of noncurrent liabilities 125,574 174,791
. .
A0couitts payab1 ipade. '4" 53 811 5- 75 500
Short-term loans payable 46,222 56,393
Lease obligations E'" Tt 1 270 .e 83911
Accounts payable-other 235.182 245,587
Auiid epciscs 371
Income taxes payable 143 140,858
Advances ?ec)yed 67 S39 9 32
Deposits received 19,238 17,200
Proviskn lbrbprntaes 15 ,509 ) 651
Provision for directors' bonuses . 86 135
Asst retirernentobhgtttjons 3 206 925
Provision for loss on the Great East Japan Earthquake 16,270 1,992
ota'l cOn cot liabilities , 587 436 79s,07(
Total liabilities 1.551,512 1,787,043
'letassets l' c . -
Shareholders equity
Captta slOck 141 851 141l
Capital surplus
Legal capitl surplus 30's 676 3fl5 f7(
Other capital surplus . 61,415 61,427
Tolal capital surpluses 367 091 367 504
Retained earnings
Legal retained earnings Ii 752 11 7';2
Other retained earnings
Reserve fol- tdvam,ed depreuitnon ofisonuin cut assets 79 627
Reserve for special depreciation 228 11080
Gceral iecerv i 38) Ol 1 570 '3
Retained earnings brought forward 285,467 280,815
Total retained earnings 1 679 061 1 86S.210
Treasury stock (125,244) (346,163)
Total shareholders quit) 2:062.7 60 2 028 002
60-
(Amount Unit: Millions ofvcn)

As of March 31.2031 As of March 31. 2012
Valuation and translation adjustments S
Valuation diffcrece on available-for-sale securities 28.647 35.807
Total valuation and translation adjusimenis 28,647,',35,807
Subscription rights to shares 1.410 1,037
Tt1 net aste1$S S 2,092,818 . . 2,064,847
Total liabilities and net assets 3644.330 3851,891
-61.
(2) Statcrncnts of Income
(Amount unit: Millions olyen)
Year ended March 31 2011 Year ended March 31, 2012
Operating inCome and loss fiorn tëlecomnttiniea(ions
Operating revenue
'fotal OperatinglevefluC . . 2,371,432 . . 2,278.652
Operating C,l)CtlSS
Btismess epenes 3,80 968
Operating expenses 107
r tulitits iii Imkn inc penes 8103i 88 280
Common expenses . 2.234 2.617
Admmistratnc X9flSCS -' 4 , 67 620 67 381
Experiment and research expenses - 9,277 8,080
Depru man 403 696 368,569
Noncurrent assets retirement cost 21,867 . - 15,369
coinmumcation ficilit 1c 388 035 374 044
Taxes and dues 37622 39,827
'lot ii opesation xpensec 1 793 198 1 760 I
Net operating income from telecommunication 578,233 319.469
Opuiling mcome and loss Iroin incidcnhl business
Operating revenue S. 767,310 994,883
Oerathsg expenses .: . . ............. : ........... :: ......917,274:
Net operating loss from incidental business (149,964) (86.029)
Non-operating income
hwere t nir,ome 1 619 I 770
Interest on securities 11) . 170
Di 0 ds income 964 9 792
Miscellaneous income 6,353 8.010
• Total noti-op'eñttinincom ,:
. : •.• " . :.___:. . f\:....... 'l204. ' -: . . . : . : 19,743
Non-operating expenses
interest xpcnses 7 4 6 626
Interest on bonds 6.374 . 6.005
Mtsccllaneous cponses 3701 4976
Total non-operating expenses 17,390 17.608
Ordinaty jneom 422 929 434 57
Extraordinary income
Gins on SSILS Of noneurrent asetc I 31 171
- Gain on sales of investment securities 137 ... . .
Gun ott siks ofcubsidjities tnd affiliates stocks 10
Gain on sales of subsidiaries and affiliates stocks 364 123
Gu on re\ n crs al or.sbt scription rights to shams 451) 491
Gain on stock exchange - 4,909
Dividends due to lftIuidittiOJt ofsiletit parinersjsip onrat .. : . : .: '. . 6,976
Gain on Provision for loss on the Great East Japan Earthquake - 6.814
'lolal extraordinary inco,sc : . : . . . 77777777' 19627
-62-
(Amount unit: Milliofls ofyen
Year ended March 31. 2011 Year ended March 31. 2012
Extraordinaiv loss ... . . . . .
Loss on sales of noncurrent assets - 657
Impaimicnt loss 8,515
Loss on retirement of noncurrent assets 31.054
Loss on valuation of investrnnt securities . . .. . 368t 469
Loss on sales of stocks of subsidiaries and affiliates 815
• l,bss on liquidation ofsubidiariçs • :y :: . .• •..4Q58 . .
Loss on adjustment for changes of accounting standard for ass 1,120
• Loss on the Great East 3apaoEarthquake.1 . .'.. :_______. : -• 17;-557 •. 4,049
Total extraordinary losses ... . 143,341 13.692
Income taxes-current 40,434 162,284
. •2::- . . -.. (n axes & Orred • (15,351)_____. _____ - __. ____.. ___.28,589
Total income taxcs . . 25.082_ 190,673
Net income 26_823_________________________________ 249_836
-63-
(3) Statements of Changes in Net Assets
(Amount unit Millions ofveti)
Year ended March 31. 2011 Year ended March 31, 2012
Shot cho1dcr' equity
Capital stock
Balance at the end of previous period 141,85 I . 141.851
Balance at the end of current period 141851 141,851
Capital surplus
Legal capital surplus
Rd tncc at the etid of plc'.tous period .0 676 305 676
Balance at the end of current period 305,676 305.676
Other Lipltll Surplus
Balance at the end o previous period 61,4 IS 61,415
Dispo il oi treasury aloLh 12
Total changes of Hems during the period - 12
Balance at the end of ctrrcn penod. r - ..-. ... : ... ,. - .................... •. •-. . 6-,4I5 ' : -- . 61,427
Retained earnings
Lep'il retainid e snungs 4.
Balance at the end of previous period 11,752 11,752
RAW 31 the cad of curruit period 11 752 11 7)2
Other retained earnings
Rescrse br aclsanced deprcetation 0) noncttrjent assets ws
Balance at the end of previous period . 579 .
chstsgea of items duritig tb. period
.
Provision of reserve for advanced depreciation of noncurrent ass 579 48
Total changes of items thirmg the period > 79 48
Balance at the end of current period 579 627
Rasej- e for special deprecntxin
Balance at the end of previous period 417 228 ,
ban es of items durtlb the period
, ,
Reversal of reserve for special depreciation (189) (125)
Total ehsnes of items durmglhc period (1S9) 852
Balance at the end of current period , 228 1,080
Gcneral rest,rs C
Balance it the end ofprevious period . 1,232,933 1.381,033
tJnnes of itnis dunng she period
Provision of general reserve . 148,100 189,900
Balance at the cod of current period , 1,381,033 1,570.933
RelninCd csrnt 1s brought Jorssard
Balance at the end of prcvioua period 235037 285,467 ,
of items .dsiritg the period - . . • ................ . . ..
Dividends from surplus (57,903) (63687)
Pros ision of rcscrs i. br specril depreciation (977)
Reversal of reserve for special depreciation 189 123
Ptovisjon of reserve for.aclvaiicccl dcpnccitttion of flottcurreni Ssseis
Provision of general reserve (148,100) (189,900)
Net (ticonie . . .... . . . . . . ________________. 256,823. . . . 249.836
-64-
(Amount 1111iii Millions oiyen)
Year ended March 31. 201) Year ended March 31. 20)2
(4,052) Total chatgas oflierns duringthe period 50.430
Balance at the end of current period 285,407 2808 )5
Ircasury stock •. . . .................................... .
Balance at the end of previous period (25,244) (125244)
Oh.) ol ttems durine the pcflfld
Purchase of truistiry stock (99,999) (220,969)
Dispoul of treasury stodk .: .•
S ...... .- .
•fotal changes of items durm8 the period (99.999) (220,9)9)
Bsl'tnce it the codof current period (125 244) (346 163)
Total shaseholdcrs' equity
Balance at the end of previous ptr,pd " I 963 839 2 062 760
Changes of items during the period .
Dis ,dend Irom surplua 9O) (3 687)
Net income 256,823 249836
Purchase oftresuiy Stock " ' l., (99 999) (220 969)
Disposal of treasury stock .. 62
Total changes of itbms dur,n the petod 98 920 (4 758)
tlalancc at the cnd of current period . . 2,062,760 2.028.002
Valu 11100 and translatIon aa)uStmen*
Valuation difference on available-for-sale aecurities . . . .
Ba1nce at the c-nd of pres ipus period 29 98( 28647
Changes of items during the period . .
Net changes fiIeiiitotl*xThañ hrehd1d'
'Iota) changes of items during the period (1,333) 7,159
Balance at the end Ofeurrern period .J__211 647 35 807
Subscription rights to shares
Bal race at use endofpyet 1005 pçisod i 1 475 I 410
Changcs 01' items during the period
Net changes of Items other than sharehqlders equily S "it (64) (372)
Total changes of items during the period ((A) (372)
ilalanci. at the end ofeurront prtod 1 4)0 1 037
rotal net assets
Balance at the et)d of previous peri0d I 995 296 20928)8
Changes of items during the period ...
Di idenda froo3urplu (57 903) (63 687)
Net iiCOilse . 256,823 249,836
Purchase ol trestausy stock' (99 999) (220 969)
Disposal of treasury stock . . - 62
Netchani.t of items otherihan Shareholders equfly (1 398) 6787
loral changes of items during the period 97,52) S (27,970)
I) ilancg at the end of current geriqd 2 092 1118 2 064 84t
- 65 -
EXHIBIT B
Total Call Mobile
Lifeline Program Verification Form
(Internal Use Only)
Ttai Call
App ID #:
rn o bile
LIFELINE PROGRAM VERIFICATION FORM
INTERNAL USE ONLY
Complete and store this form for all Lifeline applications received by Total Call Mobile ("TCM). Fill in the information below based upon the
application identified above. To qualify for Lifeline service from TCM, an applicant must meet the requirements under either Section 1 (Income-
Based Eligibility) or Section 2 (Program-Based Eligibility) below.
INCOME-BASED ELIGIBILITY
a)Household Members: (fill in based on response in #3 of application)
b)Maximum Annual Household Income $ (fill in based on response in #3 of application)
C) Customer Annual Household Income $ (fill in based on response in #3 of application)
d)Documents reviewed (check all applicable)
0 Divorce Decree / Child Support Documents 0 Unemployment/ Workers Compensation Benefits Statements
0 Pay stubs (most recent three consecutive months) 0 Veterans Administration Benefits Statements
0 Retirement / Pension Benefits Statements 0 W2 Statements
0 Social Security Benefits Statements
e)Based on my review of the documentation provided by the applicant, the applicant is:
_Approved (i.e. the documentation indicates that the applicant earns less than the Maximum Annual Household Income threshold indicated
above)
Denied (i.e. the documentation indicates that the applicant earns more than the Maximum Annual Household Income threshold indicated
above)
2. PROGRAM-BASED ELIGIBILITY
a)Applicant indicated that the applicant is enrolled in the following programs that are eligible for Lifeline participation (must choose at least 1)
o Federal Public Housing / Section 8 0 National School Lunch Program (free program only)
0 Food Supplement Program! Food Stamps 0 Temporary Assistance for Needy Families
0 Low Income Home Energy Assistance Program 0 Other State Program (list state and program name)
E Medicaid/ Medical Assistance State:
b)Documents reviewed (must choose at least 1)
El Notice letter of participation 0 Prior years statement of benefits
0 Program participation card I document 0 Other official document evidencing participation:
c)Based on my review of the documentation provided by the applicant, the applicant is:
_Approved (i.e. applicant has provided adequate evidence of enrollment in at least one of the programs listed in Section 2(a))
Denied (i.e. applicant has NOT provided adequate evidence of enrollment in one of the programs listed in Section 2(a))
3. Certification of Approval or Denial
In approving or denying the application identified above, I hereby certify that I reviewed the eligibility documentation provided by the applicant. If
the applicant is approved, I certify that I have checked TCM's database to confirm no prior or duplicate approvals exist for this individual applicant
or this applicants household.
Signature: - Date:
Print Name:
Based on the foregoing, the applicant was:
Approved for participation in the TCM Lifeline Program
Approval letter sent: -By:
- Denied for participation in the TCM Lifeline Program
Denial letter sent: By:
Complete and store this form for all Lifeline applications received by Total Call Mobile ("TCM"). Fill in the
information below based upon the application identified above. To qualify for Lifeline service from TCM, an
applicant must meet the requirements under either Section 1 (Income-Based Eligibility) or Section 2 (Program-
Based Eligibility) below.
1. Income-Based Eligibility
a)Household Members: (fill in based on response in #3 of application)
b)Maximum Annual Household Income: $_____________ (fill in based on response in #3 of application)
c)Customer Annual Household Income: $______________________ (fill in based on response in #3 of application)
d)Documents reviewed (check all applicable):
(choices listed here)
e)Based on my review of the documentation provided by the applicant, the applicant is:
Approved (i.e. the documentation indicates that the applicant earns less than the Maximum Annual Household
Income threshold indicated above)
Denied (i.e. the documentation indicates that the applicant earns more than the Maximum Annual Household
Income threshold indicated above
2. Program-Based Eligibility
a)Applicant indicated that applicant is enrolled in the following programs that are eligible for Lifeline participation
(must choose at least 1):
(choices listed here)
b)Documents reviewed (must choose at least I):
(choices listed here)
c)Based on my review of the documentation provided by the applicant, the applicant is:
Approved (i.e. applicant has provided adequate evidence of enrollment in at least one of the programs listed in
Section 2(a))
- Denied (i.e. applicant has NOT provided adequate evidence of enrollment in one of the programs listed in
Section 2(a))
3. Certification of Approval or Denial
In approving or denying the application identified above, I hereby certify that I reviewed the eligibility
documentation provided by the applicant If the applicant is approved I certify that I have checked TCM s database
to confirm no prior or duplicate approvals exist for this individual applicant or this applicant's household.
Signature: Date:
Print Name:
Based on the foregoing, the applicant was:
- Approved for participation in the TCM Lifeline Program
Approval letter sent: By: _______-
— Denied for participation in the TCM Lifeline Program
Denial letter sent: By: _______
EXHIBIT C
Total Call Mobile
Customer Service Script
Total Call Mobile - Customer Service Script
Greeting: "Thank you for calling Total Call Mobile. This is (Representative Name). May
I please have your name and the state you are calling from?"
* * Representative "Are you calling about a new application or to check the status of a previous
app 1ication?'* *
• Make sure state is an approved state
If not ** Representative - "I am sony, we are not currently providing service in your
state You can go to www usac org/li to find a provider in your state Click on the Low
Income Households section and then click on find a service provider in your state**
• If status of application "Representative - "May I please have your address'?**
/ locate application
v' double check address (make sure the address is valid and correct)
/ relate the status to customer
/ note the contact on the account
• If new application: **Representaljve_ "Great! Thank you for calling Total Call
Mobile "i" and perform the following validations
a)"Are you the head of household?" If not then, "We can only provide service to the
head of household Please have the head of household call us and we'd be happy to
sign them up." If yes, go to (b).
b)"Do you currently have wireless or home phone service'?" If no, skip the remaining
questions and process application.
c)(if yes) "Is that a subsidized service or do you pay full price?"
d)(if subsidized) "Is this phone under the Lifeline program? The Lifeline program is
only available for one phone per household" If yes go to (e), if they don't know go
to (O if no, go to (g)
e)"We cannot provide you with a second Lifeline phone. If there is a problem with that
service or you want to be on our service, you must first disconnect your service with
your other provider and then call back to establish service with us
"Can I ask who your provider is'?" Check against the larger Lifeline providers
(Exhibit D, updated from time-to-time).
g) (if not subsidized) "Can I ask who your provider is?" Check against the larger
Lifeline providers (Exhibit C, updated from time-to-time).
If it is evident that they don't already have Lifeline service then proceed for the
application.
EXHIBIT D
Model Application/Certification Form (Maiyland)
i c:: I I1M
Channel
(if Applicable)
Wrn o bile
LIFELINE PROGRAM FOR THE STATE OF MARYLAND
To apply for Lifeline through Total Call Mobile please complete this form and submit it to the address at the bottom of the form. For more informa-
tion or assistance, call 1-800-661-7391. When you submit this application, you must include the supporting documentation indicated
below. Supporting documentation will not be returned.
1.CUSTOMER INFORMATION
First Name: Last Name:
Home Address:
(P.O. Box NOT sufficient)
Home Address: Permanent 0 Temporary
Billing Address, if different from above:__________________________
(P.O. Box IS sufficient)
Last 4 Digits of SSN: ..
Phone Number: (__)- -- -
City: Stale:
Date of Birth (MM/DDTYYYY):
City: State:
Public Aid Case Number (If applicable):
E-mail:
Zip Code:
Zip Code:
2.PROGRAM-BASED ELIGIBILITY
To qualify for Lifeline you must complete either this Section or Section #3 below. Check all program(s) that the person in Section #1 is enrolled
in If you are qualifying for Lifeline under this Section (i.e. by being enrolled in at least one of the following programs), you must provide
current proof of program participation with this application If any member of your household is a National School Lunch participant you can
check the box for that program.
F1 Electric Universal Service Program 0 National School Lunch Program (free program only)
0 Federal Public Housing! Section 8 0 Public Assistance to Adults
0 Food Supplement Program/ Food Stamps 0 Supplemental Security Income o Low Income Home Energy Assistance Program 0 Temporary Assistance for Needy Families o Maryland Energy Assistance Program 0 Temporary Cash Assistance o Medicaid / Medical Assistance 0 Temporary Disability Assistance Program
3.INCOME-BASED ELIGIBILITY
To qualify for Lifeline you must complete either this Section or Section #2 above To qualify based upon your household income the income of all
your household members must be less than the amount indicated in the table below. If your household size is greater than 8 the maximum annual
household income to qualify for Lifeline is the income indicated for 8 household members plus $5,157 for each additional household member.
Household Members:
(check the box which applies)Dl 02 03 04 05 06 07 08 _Specify
MaximumAnnual Household Income: $14,702 $19859 $25016 $30,173 $35,330 $40,487 $45644 $50,801 $_.._..
Cust comer Annual Household ncorne:$
If you qualify for Lifeline under this Section, attach the prior year's state or federal tax return for each household member or your most
recent statements of income from the following sources:
- Divorce Decree / Child Support Documents - Unemployment I Workers Compensation Benefits Statements
- Paystubs (most recent three consecutive months) -Veterans Administration Benefits Statements
- Retirement I Pension Benefit Statements - W2 Statements
- Social Security Benefits Statements
Continued on Next Page
4 LIFELINE PLAN SELECTION
Please check the box for the monthly plan that you would like to sign up for(you may change your plan at the end of any month by calling 1-800-661-
7391):
o PLAN 1(150 minutes including select international calls for free) U PLAN 3 Unlimited Talk & Text for $26.49 (regularly $3999)
O PLAN 2 (250 domestic minutes for free) U PLAN 4 Unlimited Talk, Text & Data for $36.49 (regularly $49.99)
5. MULTIPLE HOUSEHOLDS AT THE SAME ADDRESS
o If you reside at an address occupied by multiple households, including adults who do not contribute income to your household and/or share
in your household's expenses, please contact Total Call Mobile and you will be provided an additional form to complete. I certify that I reside
at an address occupied by multiple households and have completed an additional form.
6 ACTIVATION AND USAGE REQUIREMENTS
Total Call Mobile Lifeline Plans are a prepaid service When you receive your phone contact Total Call Mobile at 611 to activate To keep your
account active you must use your Lifeline service at least once during any 60 day period by completing an outbound call purchasing additional
minutes answering an in-bound call from someone other than Total Call Mobile or by responding to a direct contact from Total Call Mobile confirming
that you want to continue receiving Lifeline service with Total Call Mobile If your service goes unused for 60 days you will no longer be eligible for
Lifeline benefits and your service will be suspended (allowing only 911 calls and calls to customer service) subject to a 30-day cure period during
which you can contact Total Call Mobile to confirm that you want to continue receiving Lifeline service from Total Call Mobile.
By signing and initialing each box below, I affirm that the information contained on this form is true and correct under penalty of peijury:
7. SIGNATURE Date:
(Required)
The information contained within this enrollment form is true and correct I further acknowledge that Lifeline is a federal benefit program
and that providing false or fraudulent statements or documentation in order to receive Lifeline is punishable by law, Including fines impris-
onment, de enrollment or being barred from the Lifeline program
I meet the income based or program based eligibility criteria for receiving Lifeline service and have provided documentation of eligibility
as required by this enrollment form.
I understand that Lifeline is only available for one landline or one wireless phone per household (not both); a violation of this requirement
would constitute a violation of law and would result in my de enrollment from the Lifeline program
My household is not already receiving Lifeline service from another company. I certify that I am the head of my household and under-
stand that for the purposes of the Lifeline program a household is an individual or group of individuals who live together at the same
address and share the same income and expenses
I understand that I may be required to verify my continued eligibility for the Lifeline program at any time and that failure to do so will result
in dc-enrollment.
The address listed in this form is my primary residence, not a second home or a business, If I move to a new address, I will notify Total
Call Mobile within 30 days. If I checked Temporary address in Section 1 above, I acknowledge that I must recertify my address every
90 days.
I will notify Total Call Mobile within 30 days if for any reason I no longer satisfy the criteria for receiving Lifeline including, as relevant, if I
no longer meet the income-based or program based criteria, I begin receiving more than one Lifeline benefit or another member of my
household starts receiving a Lifeline benefit. I understand that I may be subject to penalties if I fail to follow this requirement.
I authorize Total Call Mobile to access my records in order to verify eligibility as required by federal or state agencies. I understand that
my Information (specifically, my full name, address, date of birth and the last four digits of my social security number) will be transmitted
to administrators managing state and/or federal databases.
Lifeline is not transferable. I will only use this phone for my family's own use and will not resell it, or give it to others.
In addition, I acknowledge that Lifeline enrollment may be terminated by Total Call Mobile in the event that federal or state Lifeline
Programs are changed or terminated, if I no longer qualify for Lifeline, If Total Call Mobile discontinues its Lifeline participation, if I do not
use the Lifeline phone for 60 days, or if I breach the terms and conditions at totalcallmobile.com/IiIeline.
Please mail this application, with supporting documentation to:
Total Call Mobile, Lifeline Program
1411 W. 190th Street, Suite 700, Gardena, CA 90248
EXHIBIT E
Sample Lifeline Brochure
Tww tal Call
mobile
MMME'l I ifplinp FIinihiIitv
For more information or to sign up. call 1-800-661-7391.
If you qualify for the Lifeline program In the state of Maryland,
you can choose from the Lifeline Plans below. NI of Total Call
Mobile's Lifeline Plans have the following features:
Afree phone (provided by Total Call Mobile). Call customer
service for upgrade options.
• Free customer service calls.
• Free voicemail and caller Id.
• Free 911 and balance Inquiry calls.
• For additional minutes, text messages, or international
calls, load an Anytime Plan" refill as described on the
back of this brochure or call customer service.
Eligibility criteria varies by state. For the state of Maryland,
you are eligible for Lifeline If you participate in one of these
Electric UnleeraSaMusProgram National SchoolLunch P
Federal Public Housing Itiection 8 Public Assistance to Adults
Food 5uuantPrcgraml Stem supplemental Security Income
LowIncome Home Energy TeenporaeyAa&stance for Needy Assistance Program Familiee Program
A 'cePr Ln Temporaey Cash Assistance
MedlcaldlMedlcal Assistance
Plan 1: 150 minutes per month :!
L (for domestic & select international calls)
• 150 minutes per month (for domestic & select international
calls) at no cost to you.
• Plan minutes expire after 30 days.
• Additional minutes are $0.10 per minute.
• Text messages are-$0.05 per text.
• For details on select international calls that have no extra
charges, see the beck of this brochure.
You also qualify for Lifeline In the state of Maryland, If your
Income is lass than 135% of the Federal Poverty Guidelines.
Number In Household Household Annual Income
I f $14,702
2 $19,859
3 ( $25,016
4
rontiltit
• 250 minutes per month (for domestic calls) at no cost to
you.
• Plan minutes expire after 30 days.
• Additional minutes are $0.10 per minute.
Text messaaes are $005 per text
omprehensive terms and conditions for the Total Call Mobile ('7CM')
feline Plans are available at wwwtotalcaflmoblie.com Al terms and
editions of service as described herein and on the reverse of this bra-
lure apply to services provided under the Lifeline Plans. Customers un-
ir8tnd and agree that by signing up for a Lifeline Plan with Total Call
oblie, they may not have a Lifeline plan with any other carrier (wireless
landline) and further agree to comply with any documentation orvertli
than necessary to conilim that they qualify for Lifeline. In addition, Cus-
mar acknowledges that Lifeline Plan enrollment maybe terminated at
iylime by TCM In the event that the federal or state Lifeline Programs
a changed or terminated, if Customer no longer qualifies for Lifeline, if
M discontinues Its Lifeline Plans, or If Customer breathes the teems
id conditiOns. TCM at Its sole discretion, will determine whether or not
Customer is eligible for aLifeline Plan. lb remain qualilled lore Lifeline
Call 114orldwide with Total Call Mobile by dialing 011 and
the dti nation. On the Anytime Plan, and Lifeline Plan 1,
there s no extra charge to call certain cities in the coun-
tries lbted below. Call 1-600-661-7391 for international
rates n other plans or to other destinations. To make
irtterr4tional calls, you must have Anytime Plan balance.
Also.tandard text message rates apply to messages
sent Worldwide.
entiria i Hungary I Singapore
tralia India I South Korea
istria Ireland I Spain
razil Israel Sweden
---------t:
nada Italy -Switzerland
hina Mexico J Taiwan
yprus Netherlands Thailand
opnmark New Zealand nited
Kdrn
I rance Norway US Guam
rman . Peru Puerto Rico
reece ' Poland US Saipan
H4ng Kong Portugal Virgin
us
T.gial Ccli •.• lOç per minute
So per text $5 • Available at $5
$10 or $20
Good for 90 Days J1Elli
•DIiIIDIiI8)rI
T.1'tal Call .1000 minutes
29 . 1000 text
DAYS messages
-
• Good for 30 days
f --talCall ,..mobi!e • Unlimited talk & $3952 text
Unlimited Good for 30 days
Taik Text
T.'tal Call
.øaamrn'obiie
Conditions
Comprehensive terms and conditions are avaitabie at
www.totalcallmobile.com . Total Call Mobile (TCM) service is for per-
sonal use within the United States.'Unlimited' does not mean unrea-
sonable use. Unreasonable use includes but is not limited to confer-
ence calling, monitoring services, abnormally large data transmis-
sions, broadcast, te!narkeling, aurodialed calls, commercial uses,
an abnormally high number of calls/messages or abnormally long
caD s tethering to another device for data transmission, or any other
usage that interferes with TCM service/network resources. Data is
only available with select handsets. TCM data plans may not be used
with smart phones/PDA devices unless the plan is.explicitly identified
for such devices. International calls. are chsged at the applicable rate
plus air tjme;'Advertised international rates and Free international Lo-,
catiore do not apply to csts- made to foreign mobile, phones or to Off
n&work/snecial locations and in some-instances may he hiohe,r. The
--.- - ', -
EXHIBIT F
Lifeline Service Offering
Service Offering
TCM's Lifeline offering proposes to give eligible customers three Lifeline Plan choices:
Option 1: Lifeline 150 Minute Pl an *
150 anytime minutes per month
(additional usage priced at 10 cent minutes, texts are 5 cents per text message)
Net cost to Lifeline customer: $0 (free)
*This package includes:
• Free handset
• Free Voicemail and Caller-ID
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
• No additional charge for international calling to the 250 locations listed on Exhibit E (i.e.
only the standard per minute rate applies)
• International calls to other destinations require additional funds based on call destination
Option 2: Lifeline 250 Minute Plank
250 anytime minutes per month
(additional usage priced at 10 cent minutes, texts are 5 cents per text message)
Net cost to Lifeline customer: $0 (free)
*This package includes:
• Free handset
• Free Voicemail and Caller-ID
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
• International calls require additional funds based on call destination.
Option 3: Lifeline Credit - Discount Pl an*
Lifeline eligible customers may choose the 30-day Unlimited Talk & Text plan or the 30 day
Unlimited Talk, Text & Data at a discount off of retail. Said discount will differ based on the
customer's state (ranging from $10 - $20). Additional details regarding TCM's plans can be
found at www.totalcallmobjle.com/rateplans rnonthly.aspx.
*This package includes:
• Free handset
• Free Voicemail and Caller-ID
• Free calls to Customer Service
• Free calls to 911 emergency services
• Free balance inquiries
EXHIBIT G
Lifeline 150 Minute Plan
Free International Calling Destinations
Free International Calling Destinations on the Lifeline 150 Minute Plan (Certain special or
off-network locations may be excluded from the Free International Calling Destinations; (calls to
landline phones only unless explicitly indicated otherwise)
List includes over 250 locations worldwide and 30 countries. Locations are subject to change
from time to time. Please visit totalcallmobile.com for an updated list.
Featured Countries
Argentina
Argentina-Buenos Aires
Argentina-Cordoba
Argentina-Mendoza
Argentina-Rosario
Australia
Australia-Melbourne
Austria
Brazil
Brazil-Belo Horizonte
Brazil-Campinas
Brazil-Rio de Janeiro
Brazil-Sao Paolo
Canada
China
China-Beijing
China-Cellular
China-Guangzhou
China-Shanghai
Cyprus
Denmark
France
France-Paris
Germany
Greece Norway
Greece-Athens Peru
Hong Kong Peru-Lima
Hong Kong-Cellular Poland
Hungary Poland-Warsaw
Hungary-Budapest Portugal
India Singapore
India-Ahmedabad Singapore-Cellular
India-Bangalore South Korea
India-Bombay South Korea-Seoul
India-Calcutta Spain
India-Cellular Sweden
India-Hyderbad Switzerland
India-Madras Taiwan
India-New Delhi Taiwan-Taipei
India-Rune Thailand
India-Punjab Thailand-Bangkok
Ireland Thailand-Cellular
Israel United Kingdom
Italy US Guam
Mexico (city list which follows) US Puerto Rico
Netherlands US Saipan
Netherlands-Amsterdam US Virgin Islands
New Zealand
Free International Calling Destinations on the Lifeline 150 Minute Plan (continued)
Mexico City List
Guadalajara Ciudad Constitucion Heroica Ciudad de Ures
Ciudad de Mexico Ciudad Cuauhtemoc Hidalgo
Monterrey Ciudad del Carmen 1-luatabampo
Acaponeta Ciudad Delicias Huetamo
Acapulco Ciudad Guzman Huimanguililo
Actopan Ciudad Hidalgo Huitzuco
Agua Prieta Ciudad Juarez Iguala
Aguascalientes Ciudad Lazaro Cardenas Irapuato
Allende Ciudad Mante Ixtapan de la Sal
Apatzingan Ciudad Obregon Ixtlan del Rio
Apizaco Ciudad Sahagun Izucar de Matamoros
Arcelia Ciudad Valles Jalapa
Atlacomulco Ciudad Victoria Jalpa
Atliaca/Tixtla Coatzacoalcos Jerez de Garcia Salinas
Atlixco Colima Jojutla
Autlan Cordoba Juchitan
Bahia de Huatulco Cosamaloapan La Barca
Cabo San Lucas Cozumel La Paz
Caborca Cuautla La Piedad
Cadereyta Jimenez Cuernavaca Lago de Moreno
Campeche Culiacan Leon
Cananea Durnago Lerdo de Tejada
Cancun Encarnacion de Diaz Lerma
Celaya Ensenda Linares
Cerralvo Estación Manuel Los Mochis
Cheumal Fresnillo Los Reyes
Chihuahua General Tapia Magdelena
Chilapa Guamuchil Manuel
Chilpancingo Guanajuato Manuel Ojinaga
Cintalapa de Figueroa Guasave Manzanillo
Ciudad Acuna Guaymas Martinez de la Torre
Ciudad Altamirano Guerrero Negro/Santa Rosa Matamoros
Ciudad Camargo B Hermosillo Matehuala
Free International Calling Destinations on the Lifeline 150 Minute Plan (continued)
Mexico City List (continued)
Mazatlan
Merida
Mexicali
Minatitlan
Monclova
Moelia
Moroleon
Nacozari de Garcia
Navojoa
Nogales
Nuevo Casas Grandes
Nuevo Laredo
Oaxaca de Juarez
Ocotlan
Ometepec
Orizaba
Pachuca
Pale nque
Parral
Parras de la Fuente
Patzcuaro
Penj a mo
Petatlan
Piedras Negras
Playas de Rosarito
Poza Rica de Hgo
Puebla
Puerto Penasco
Puerto Vallarta
Pu r uandi ro
Queretaro
Quimichis/Tecuala
Reynosa
Rio Grande
Rio Verde
Sabinas
Sahuayo
Salamanca
Saltillo
Salvatie rra
San Andres Tuxtla
San Cristobal de las Casas
San Fernando
San Jose de Gracia
San Jual del Rio
San Luis de La Paz
San Luis Potosi
San Luis Rio Colorado
San Martin Pachivia/Teloloapa
San Miguel de Allende
San Quintin
Santa Ana
Santa Rosalia de Camargo
Santiago Ixcuintla
Santiago Papasquiaro
Santiago Tianguistenco
Silao
Tala
Tampico
Tapachula
Taxco
Tecate
Tecoman
Tecpan de Galeana
Tehuacan
Tenancingo
Tenango del Aire/Tialmanalco
Tepatitlan
Tepic
Tequila
Texcoco
Teziutlan
Ticul
Tijuana
Tizayuca
Tizirnin
Tiapa de Comonfort/
Alcozauca de Gro.
Tlaxcala
Toluca
Torreon
Tula
Tulancingo
Tuxpan
Tuxtepec
Tuxtla Guttierez
Uruapan
Valle de Bravo
Veracruz
Villa Flores
Villahermosa
Vurecuaro
Zacapu
Zacatecas
Zamora
Zihuatanejo
Zinapecuaro
Zitacuaro
Zumpango
EXHIBIT 6
2010 Lifeline Participation Rates by State
2-15-11
• - Below 107.
• -107.-
• - 20Z -
• — Above
2010 Lifeline Participation Rates by State
HI
Notes
Due to the intricacy and range of
determine eligibility for the Lifeli
limitations of the data used, the IT
create this map involves several e.......
simplifications. and omissions. Therefore. the rates
generated on this map should be treated as estimates only.
EXHIBIT 7
Wire Center List
WC—Code IDAHO
BYVWIDXX
CLFKIDXX
CRALIDXX
FRFDWAXA
FRTNWAXX
GRFDWAXX
HOPEIDXX
HRSNIDXA
HYLKIDXX
NWPTWAXX
PLMRIDXX
PNHRIDXA
PRRVIDXX
PSFLIDXX
RCFRWAXB
RTHDIDXX
SNPNIDXX
SPLKIDXX
ALBNIDXC
AMFLIDMA
BLSSIDMA
BOISIDMA
BOISIDNW
BOISIDSW
BOISIDWE
BRLYIDMA
BRUNIDXC
BUHLIDMA
CLWLIDMA
CNCLIDXC
CRGMIDOI
CSCDIDXC
CSFRIDMA
DECLIDMA
DNLYIDXC
EAGLIDNM
EDHZIDMA
EMMTIDMA
FILRIDAA
FRLDIDXX
GDNGIDMA
GENSIDXX
GLFYIDCO
GLFYIDMA
HALYIDMA
HGMNIDMA
HLSTIDXC
HMDLIDXC
HRBNIDXC
JERMIDNM
KMBRIDMA
KTCHIDMA
KUNAIDMA
LAPWIDOI
LEN RIDXA
LSTNIDSH
MCCL IDXC
MDTNIDMA
MDVAtDXC
MELBIDMA'
MNDKIDXC
MRDNIDMA
MRNGIDXC
MRTGIDMA
MSCWIDXX
MTHOIDMA
MTHOIDSO
NM PA ID MA
NPMOIDMA
NRLDIDXC
NUARIDXC
NWMDIDXC
OKLYIDXC
PARM IDXC
PAULIDXC
PECKIDXX
PYTTIDMA
RFRVIDXC
RKLDIDXC
RPRTIDXC
SHSHIDMA
SOMTIDXC
STARIDNM
SWETIDXC
TROYIDXX
TWFLIDMA
UNTWWAXA
WESRIDMA
WLDRIDXC
WNDLIDMA
MALTIDXC
RCFDIDXC
ABRDIDXC
ARCOIDXC
BLFTIDMA
FRTHIDMA
HAMRIDXC
HOWEIDXC
IDFLIDMA
INKMIDMA
LSMNIDMA
PCTLIDMA
PCTLIDNO
RBRTIDMA
RGBYIDMA
RIRIIDMA
RVSDIDMA
RXBGIDMA
SHLYIDMA
SPFDIDXC
STATIDMA
STNLIDXC
TRTNIDXC
DWNYIDMA
DYTNIDMA
FKLNIDMA
LHSPIDMA
MCCMIDMA
MLCYIDXC
MTPLIDMA
PARSIDXC
PSTNIDMA
DRGSIDMA
EXHIBIT 8
Key Management Resumes
MANAGEMENT INFORMATION
Masaaki Nakanishi, President and Chief Executive Officer
Mr. Nakanishi became the President and Chief Executive Officer of Total Call International, Inc., in
January 2012, where he directs and oversees the operations of Total Call International and its affiliate
companies. Along with his position at Total Call International, Mr. Nakanishi also holds the positions of
President and Chief Executive Officer of KDDI America, Inc., and Telehouse International Corporation
of America, both headquartered in New York. Prior to holding his current positions, he held senior
executive positions with KDDI Corporation, headquartered in Japan, and has extensive experience in the
telecommunications industry, dating back to 1975, when he first joined the KDDI group of companies.
With over thirty-five years of experience, Mr. Nakanishi provides substantial depth of knowledge
regarding the business, technical and managerial experience of the telecommunications industry to Total
Call International. Mr. Nakanishi received his B.A. in Law from Sophia University in Japan.
Hideki Kato, Chief Operating Officer
As Chief Operating Officer, Mr. Kato is responsible for overseeing all business operations of Total Call
International. Prior to joining Total Call International in 2012, Mr. Kato worked for KDDI Corporation in
Japan for 19 years, and his latest assignment was as a Manager of the Post Merger Integration Group.
While based in Tokyo, Mr. Kato also served as a member of the board of directors of various overseas
affiliated companies, including Mobicom Corporation in Mongolia and Vostok Telecom in Russia. Mr.
Kato received his B.A. in Law from the University of Tokyo.
Masato Takei, Chief Financial Officer
As Chief Financial Officer, Mr. Takei is responsible for overseeing the financial activities and planning of
Total Call International. Prior to his current position with Total Call International, Mr. Takei served as the
General Manager, Accounting and Finance Department at KDDI Corporation in Tokyo, Japan. Mr. Takei
also currently holds the position of Vice President, Corporate Planning and Administration at KDDI
America, Inc., in New York, New York. Mr. Takei received a Bachelor of Laws from Kwansei Gakuin
University in Japan.
Voltaire Hernandez, Chief Sales and Marketing Officer
As Chief Sales and Marketing Officer, Mr. Hernandez is responsible for overseeing the sales channels,
sales team and maintenance of all prepaid long distance and prepaid mobile products and services. He
was previously the Vice President of Sales and Marketing, having achieved the position in July of 2002.
Mr. Hernandez joined Total Call International as a Retail Sales Manager in January of 2000 with a focus
on retail distribution of prepaid cards. Mr. Hernandez has a strong background in sales and established a
multi-million dollar nationwide distribution system for prepaid phone cards in less than a year.
Robert Yap, Chief Legal/Administrative Officer and Corporate Secretary
As Chief Legal/Administrative, Mr. Yap is responsible for overseeing all transactional, litigation,
regulatory, and governmental affairs matters for Total Call International. Mr. Yap also serves as the
Corporate Secretary of the company. Prior to joining Total Call International in 2007, Mr. Yap was a
practicing attorney at Artiano & Guzman (2001-2007) and at McDermott, Will & Emery (1999-2001).
Mr. Yap received his B.A. in Economics from Northwestern University and his J.D., with honors, from
George Washington University School of Law.
Yuichi Yokoyama, Vice President of Human Resources and Administration
Mr. Yokoyama is the Vice President of Human Resources and Administration for Total Call International,
and has been in his current position since January 2012. In his position, Mr. Yokoyama oversees the
management of the Human Resources and Administration departments within Total Call International.
Prior to joining Total Call International in 2012, Mr. Yokoyama worked for KDDI Corporation in Japan
for over twenty years. His most recent assignment with KDDI Corporation was as a Manager of Post-
Merger Integration Group. While based in Japan, Mr. Yokoyama also served in the Consumer Business
Unit for four years. Mr. Yokoyama brings his wealth of experience and depth of knowledge to the Total
Call International team. Mr. Yokoyama received his B.A. in Business Administration from Meiji
University in Japan.