Anschutz Company and Subsidiaries - Page 12

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          The customer purchased fiberoptic cable separately, and Qwest or            
          the customer pulled the fiber through the conduit.  The entire              
          conduit and fiber became the property of the customer once the              
          contract was completed.                                                     
               In addition to installing conduit for its customers, Qwest             
          installed additional conduits for its own potential future use or           
          sale.  The rail plow allowed Qwest to install multiple conduits             
          at the same time and at a relatively modest additional cost.                
          Generally, the only additional costs of adding the retained                 
          conduits were the cost of the material, including the conduit and           
          hand holes, and the cost of handling that material.  These costs            
          were mostly covered by profits from the third-party customer                
          contracts.                                                                  
               At the time of installation, Qwest did not have customers              
          lined up to purchase the retained conduit.  With rare exception,            
          Qwest always kept at least one conduit for itself in connection             
          with all of its conduit projects.                                           
               Petitioners have conceded the adjustments to the MFS Los               
          Angeles, MFS Dallas, and MCI Dillard-Myrtle Creek projects.  See            
          supra note 1.  The nine conduit installation projects still in              
          issue, in chronological order, are: (1) MCI San Jose to Reno, and           
          Reno to Wells; (2) MCI Salt Lake City to Denver; (3) Viacom San             
          Francisco Bay; (4) MCI Denver to El Paso; (5) MCI Kansas City to            
          St. Louis; (6) US West Phoenix to Mesa; (7) MCImetro Dallas; (8)            






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Last modified: May 25, 2011