Good morning. My name is Howard Michaels and I will be your conference operator today. At this time I would like to welcome everyone to the Qwest conference call. All lines have been placed on mute to prevent background noise. After the speaker’s remarks, there will be a question-and-answer session. (Operator Instructions) Mr. Fawkes, you may now begin your conference.

Thank you, Howard. Good morning and welcome everyone to our call this morning. For the format of the call today, we’re going to begin with some prepared remarks from Ed Mueller, our Chairman and CEO, Tom Richards, our COO and Joe Euteneuer, our CFO and then we’ll take your questions. As we begin our call, let me point you to slide three and remind everyone that today’s discussion contains forward-looking statements. Our future actual results may vary materially from any forecast contained in these forward-looking statements due to a number of risks and uncertainties and for a detailed discussion of these risks and uncertainties; I strongly encourage you to review our periodic SEC filings. Additionally, we do not adopt analyst estimates nor do we necessarily commit to updating forward-looking statements that we’ll be making this morning. This morning we will also be discussing certain non-GAAP financial measures including adjusted EBITDA, adjusted free cash flow and net debt. A full reconciliation of these measures is available on our website. Moving on to slide four, our reported earnings per share for the quarter was $0.12. If you remove severance charges from both periods, the comparison is $0.13 this quarter versus $0.10 in the year ago period, that’s a 30% increase. The current quarter results were aided by an improved contribution from cash EBITDA, which added $0.02 to earnings and this was offset by $0.02 per share dilution, associated with incremental non-cash pension and OPEB expense. The first quarter of 2009 also benefited by $0.001 due to a lower effective tax rate and by another $0.001 from reduced net interest expense compared to the year ago period. With that, I’m going to turn it over to Ed.

Thanks Kurt and good morning everyone. Thank you for joining us on our call today. Let me begin by saying I’m very pleased with our execution in the quarter. We started off 2009 with strong free cash flow and EBITDA performance that exceeded expectations. This was particularly encouraging given the current challenges in the economy. Our results this quarter reflect our priority of managing the business for free cash flow, including disciplined margin and capital return thresholds to generate profitable revenues. For example, about half of our annual decline in revenues in the quarter was due to our initiatives to improve wireless profitability and reduce other low margin revenue. Tom and Joe will describe this in more detail in their remarks. Our first quarter results reflect our commitment to our vision of perfecting the customer experience. This vision is a next step beyond spirit of service. It captures the imagination of the customer, offering the products and services they desire, while exceeding their expectations in value, service and quality. When we deliver the perfect experience, we can retain and convert customers to advocates who stand next to us to win the battle against our competitors and ultimately unlock shareholder value. The road map for achieving our vision is our key strategies we have discussed with you on prior calls. So, let me update you on our progress on these strategies. As an example of our strategy of delivering simplified solutions, in the first quarter, we launched the digital vault, a virtual storage capability for our high-speed internet customers. We expect this to be the first of several distinctive enhancements that we will be delivering for our broadband customers in the months ahead. In the quarter, our video and wireless subscriber bases continue to grow as customers bundle Qwest services with…

Thanks Ed. Good morning everyone. I’m happy to share a more in-depth look into our segment results with you today. I too, continue to be pleased with the overall performance of our team. While each of our business units confronted pressures impacting the entire industry, all delivered segment margin percentage expansion and solid segment income results. Within business markets, we continue to deliver recurring revenue growth. Our mass market segment made great progress on wireless migration and broadband initiatives and our wholesale results provide good evidence of our efforts to improve profitability. As Ed noted, we are focused on living our philosophy for generating profitable revenue. This need is especially acute given the current macroeconomic climate. Getting to the details, I will start with business market segment on slide nine. We reported annual revenue growth of 3% this quarter and continue to outperform industry levels. In the quarter, business markets revenues declined 3% sequentially due to a 24% drop in equipment related revenues. Recurring revenues increased year-over-year for the sixth consecutive quarter and also improved sequentially. As I noted on our last call, we were seeing longer sales cycles across the enterprise space, coupled with smaller aggregate proposal values in the early stages of this year. Customers appear to be focused on potential cost opportunities and structure and capital projects to allow for several smaller investments overtime; however, we are encouraged that as we have seen customer activity levels and sales cycles improve as we lead into the second quarter. Business market segment income and margin percentage expanded in the quarter, both sequentially and year-over-year. Compared to the prior year, business markets benefited from efficiencies in network operations. Sequentially, cost declined as a result of lower equipment expenses. On slide 10 we provide a more in-depth view of our revenue…

Thanks Tom. Good morning everybody and thank you for joining us this morning. Let me start-off by saying I am very pleased with the progress the Qwest team is making in providing consistent execution on the goals we have established for ourselves. Although two quarters do not make a trend, I think our recent performance demonstrates our capability and commitment to meet expectations through effective operating execution. In my remarks today I will cover free cash flow, our income statement and discuss progress on our balance sheet. I will conclude my prepared remarks with some thoughts on the outlook for the rest of the year. On slide 17, we highlight some key elements in the P&L for the quarter. As you heard from Ed and Tom, we had strong performance in key product revenue areas. However, this strong product performance is masked when you look at our overall reported revenue sequential decline of 4%. This decline was in a large part due to the impact of our wireless migration to Verizon, our efforts to improve equipment revenue profitability and eliminate unprofitable wholesale business. Without these items, our remaining revenues declined 1% sequentially from the fourth quarter to the first quarter of ‘09. In making the same comparison for the third quarter of ‘08 compared to the fourth quarter of ‘08, it results in the same 1% sequential decline versus the reported sequential decline of 2%. I believe this gives you some indication of our focus on producing profitable revenues, which helps to explain the strong margin improvement we have achieved over the past couple of quarters. In the first quarter, we had very good cost controls throughout the business. To give you a flavor for the breadth and the depth of our cost actions, nearly all areas of the company…

(Operator Instructions) Our first question or comment comes from the line of Mr. Tom Seitz from Barclays Capital, your line is open. Tom Seitz – Barclays Capital: Yes, thanks for taking the question. Two quick ones if I might. Last quarter you mentioned that one of the capital projects you were considering was the building of fiber rings outside of the Qwest or the U.S. west classic territory. Can you update us on, whether or not you are still considering moving forward with that project? Then secondly, some of the ROX talk about an integrated box that they hope to rollout this year with Dish that essentially uses their broadband pipe in conjunction with the broadcast model of the Satellite Company and perhaps better shared economics on that platform. Can you give us any sort of hints as to what your plans are with that program?

Hey Tom, it’s Tom Richards, good morning. On the capital question about the fiber rings, we are moving forward. As we stated last call, the actual number depends on kind of the marketplace, but we continue to see opportunities where we can expand the footprint. On the second question about the integrated box that you mentioned referencing Dish, at this point we don’t have any specific plans along those lines with our partner of DIRECTV. Although, I will tell you we have lots of discussions going on looking at broadband, how to deliver video over broadband, because as we’ve said a number of times, we believe there’s a significant upside opportunity there for customers. We believe their viewing tendencies are changing and we plan to be in the middle of that opportunity going forward.

Okay great. Thank you.

Our next question or comment comes from the line of Mr. David Barden from Banc of America. Your line is open.

Hey, good morning guys. Thanks for taking the question. I guess Joe, the temptation I appreciate your comments on the guidance. I guess the temptation here is to look at the first quarter to look at the run rate we are on now, which is kind of $4.6 billion and do the math to get down into the midpoint of the guidance range and that kind of says that from here you’d have to lose about $50 million in EBITDA each quarter sequentially for the rest of the year and that would get you down to the $43 million. I know you’re trying to be conservative and the rest of it, but that’s at the EBITDA levels, so if you gross that up for revenues, where should we be looking in the model in kind of trying to make sure we’re thinking correctly about the real risks that the economy presents to the model that would be able to generate those kinds of down sides? Sorry to put you on the spot, but it’s hard to get down there now thinking of what you’ve done. I guess the second question is just related to the wireless piece, the stub. I guess we’ve got $50 million round numbers of wireless, you’ve got 300,000 or so subs left, but you’ve taken a lot of the costs out, it looks like you’ve decommissioned the assets. So, as that goes away, is there any incremental pressure that comes as that revenue goes away or is it all kind of incremental cost saves from here? Thanks a lot.

On your last question, no, we haven’t decommissioned anything in wireless and our plan is to sort of get off the old service by the fourth quarter. Remember, the model is different from an accounting perspective, the old model was book to gross revenues and the expenses to get to which was really a breakeven or a less business to our new model, which we basically are booking the net profits up in the revenue inline and that’s really part of the reason you see the decline in revenues. In regards to your first question, no doubt your mathematics is good, but remember, we just had a great fourth quarter. We’ve now had our second quarter in a row of getting great execution and we’re only one quarter into the year and the economy in my mind still is not settled down. We don’t know where unemployment is going to fallout, etc. So, we continue to be cautiously optimistic and obviously on the second quarter call we’ll provide you better information, but remember our years are not straight lined for all four quarters. As you will recall, in the second and third quarter, second can be a little higher than third, third can be a little higher than second. Especially, in the third when you get the added expenses up in the states with the deep winters, where you’re now doing a lot of extra repairs and maintenance and typically the fourth quarter is your better performing quarter. So, I wouldn’t straight line the things, but clearly your math is good and clearly we are optimistic, but we’re cautiously optimistic because the economy is still unsettled.

Dave let me clarify, also on the wireless piece. Your question is about the contribution that we’re getting from the sprint piece of it, keep in mind we don’t have any sales and acquisition costs associated with the MVNO now, so there is some positive contribution we’re getting and it’s because we’re basically milking that base through the end of the year. However, the contribution in the first quarter was less than $0.001 a share hand; it’s going to trip down over the course of the year.

Okay great. Thanks.

Our next question or comment comes from the line of Mr. Simon Flannery from Morgan Stanley. Your line is open.

Thank you very much, good morning. I wanted to follow-up on the macro. I think when you were talking about business markets, you said you were seeing improved trends into the second quarter of ’09, but I wanted to understand whether that was something you were seeing specifically in the bidding activity for business markets or was that more broad based, that Q1 has trough and things have got better, January, February, March, April. Then just following up on the video question, we continue to see Verizon and AT&T put up good numbers on their video platforms, but it sounds like you’re not really focused on sort of a me too there, that you’d rather go something that deals with sort of over the top video rather than the traditional cable model. If you could expand on that, that would be great. Thanks.

Hey Simon, it’s Tom. On the comments, you were correct. They were primarily related to the business markets group and my looking at the funnel, which is kind of an indicator of the volume of activity and while I wouldn’t want to declare a total victory, we did see toward the latter part of the quarter some increase in the funnel, which is encouraging, because that’s an indication of activity picking up.

Simon, this is Ed. Good morning. I’ll do the video. You’re correct; we are not me too on the video product. We have and as you heard earlier in our prepared remarks, we have good progress with DIRECTV, but we still believe the future will be a combination of good product as well as internet provided video and our platform is set up for that. Tom talked about it, we’re very much interested in those people who provide that and we believe that’s emerging and we’re watching it and playing in that and our technology fits. So we’re not going to be in effect a contact provider, in other words, we make decisions and be just like AT&T and Verizon. We’re also, in Tom’s prepared remarks, we’re closing down our VDSL choice product which was our kind of me too product and that has hurt our broadband ads, but the net ads are down because of that, but we’re really encouraged by who’s taking our faster speeds and in our fiber to node footprint, our teams are really executing well.

So, you see an opportunity to gather ARPU from that, at the moment people can go straight to Hulu or an iTunes or something, but you think there’s ability for the phone company to get a business model where there is an ARPU lift beyond the basic price of the pipe?

Absolutely, and I like the margin on this versus the margin of taking content. You obviously, you have revenue increase, but I like the idea of the margin increase and absolutely believe that we see our customers taking it’s between $25 and $10 a lift just on the speed component of this. I think there’s plenty of room for this to be margin improving for us and for the customer what I like is it’s probably a decline in expenses for them, from the traditional linear programming. So I like the mathematics and I like the economic model, but I think we’re going to have to get the combination of technology and primarily the content providers are going to have to come to the party and I think they’re going to and you could also I think be reasonable in assuming that there will be an ad-based component to this, which is extraordinarily exciting to us.

Okay. Thank you.

Our next question or comment comes from the line of Mr. Michael Rollins from Citi Investment. Your line is open.

Hi, can you talk a little bit about the margins that you’re seeing, particularly in the wholesale business and what’s been driving that improvement and is there more room to go as you look at these contributing margins from the different segments, whether it’s business, wholesale mass markets? Thanks.

Good morning Michael, Tom. The primary driver in the improvement of wholesale margins has been our improvement in margins in the long distance part of that. I think we shared with you last quarter, we changed our go to market approach and that was one part of the contribution. The second part was we’ve been relentless, if you will, at looking at specific customers and specific products and I would say if you kind of took those three things in combination, they had the greatest impact on improving the overall margins that you saw in our wholesale space. The second part of your question is, do I think there is continued opportunity for margin improvement in the other parts of our business? I do. Joe eluded to in his formal comments some of the initiatives. For example, in the Business Markets Group, we’re focused on improving the profitability of our CPE or Data integration product, we think there’s room for improvement there. In our Mass Markets, we continue to believe there’s opportunities to improve both from a facilities cost perspective in some of the products that we sell, as well as, you heard me allude to some of the initiatives Dan has started relative to call center consolidation and other areas where we can take costs out of the business. So I think there is upside in each of those individual business units.

Just a follow-up on the wholesale side, should we be thinking about any further carrier consolidation that’s happened to date, that would have an incrementally negative impact just on wholesale revenue over the next 12 months or is most of that now in the numbers?

That’s a tough one for me to kind of predict what could happen out there. I think you’re going to continue to see some consolidation in the space Michael, as people try to look for efficiencies. So I think if I were sitting or you were sitting, I’d assume that there’s going to continue to be some of that. On the other hand, from our perspective, our shift in focus to data IP in the wholesale space we think gives us some opportunity to improve margins once we get that business going the way we’d like to.

Thank you.

Our next question comes from the line of Mr. Frank Louthan from Raymond James. Your line is open.

Great, thank you. Looking at the wholesale a little bit, can you give us a little color on what’s the mix as a percentage of the total from local transport and special access type wholesale versus more of the long haul transport wholesale, what that split is? Then of the cost elements you gave us some detail on, I appreciate that, can you give us an idea of which are the most scalable and which ones are more fixed? Do you expect similar year-over-year price declines or percentage cost savings going forward from those various lines? Thanks.

Frank, this is Tom, just a question to your question. The second part, were you talking specifically about wholesale or kind of the whole organization in general?

No, for the second part, you had that slide where you looked at chain of sales in marketing and network costs, facilities costs, etc and gave sort of the year-over-year cost improvements, that’s what I was referring to.

Yes, on that slide, I mean basically we will continue to look for opportunities to take costs out of our model, based on how revenues are going. Obviously, things like facility costs are tied a little directly to the number of customers and our revenue, etc. versus other costs that are more fixed. So we will continue to look to take those costs out. We still are opportunistically looking at that and we believe we can, so we’ll continue to go forward.

Okay. Frank, on the breakdown between when we look in the wholesale space, if you look at LD revenue versus the other parts of it, excluding data IP, which is kind of one of our growth areas, you could probably think of it as there’s probably 30% to 40%, somewhere in that ballpark, it’s LD and the local access base might be 20 to 30, just kind of thinking about round numbers. So, hopefully that gives you some perspective, but the big area of focus for Rolen and his team is the Data and IP area. That’s the area we think there is significant upside. We’re just beginning in the first quarter to shift the focus of that whole sales organization away from being primarily a voice, to a data IP space and I think down the road I would hope we’d be able to talk positively about the impacts we’re making in growing revenue in the data IP space.

Where are you on that sales force transition?

Well, we started in the first quarter and as you know when you do that you’re changing a culture, you’re changing compensation. I would say they probably didn’t get out the chute as quickly as I would like; however, I think they’ve made some progress here in the last month or so, but that’s not unusual. When I made some of the changes in the business markets group three or four years ago, it generally takes a quarter to two for people to get confidence, to get rhythm, to get trained, to begin prospecting differently. So I’m looking for the team to begin to see some of that improvement in the second quarter.

Thank you. That’s very helpful.

Our next question comes from the line of Mr. Jason Armstrong from Goldman Sachs. Your line is open.

Hey, thanks. Good morning. Couple of questions, maybe first on headcount you had the big reduction in the fourth quarter which, in part helped drive big margin results here. As we sort of fight off revenue declines over the balance of the year, are there more opportunities for these type of lumpy reductions. Then maybe second question just on wireless, as you transition over to Verizon, were there any sort of upfront commissions attached to that transition where you give Verizon 100,000 subs and there are sort of lumpy commissions that come in attached to that that might have impacted these results, relative to what we should expect over the balance of the year? Thanks.

Hi, Jason, it’s Tom. On headcount, yes, when I alluded to some of the things we’re looking at throughout the latter part of the year, matching workforce to workload has been kind of a constant drum beat here and we will continue to look for opportunities, center consolidation and some of the things we alluded to that were going on in mass markets will also give us opportunities, so I think it’s fair to say that there is room going forward as we think about the rest of the year. On the wireless, no, there’s no, I think the word you used is lumpy commissions that went through the quarter. That isn’t the way it was structured, so I don’t think as you think about going forward that was the result of a one-time event.

Okay. Thank you.

Our next question comes from the line of Mr. Mike McCormack from JP Morgan, your line is open.

Hey, thanks guys. Let me just one more question on the wholesale side. Can you give us a little more clarity on sort of the revenue breakdown there, Tom and it feels like some of that stuff is probably usage based that in theory should carry a fairly high margin. I guess I’m trying to get a sense for how we should be tracking both wholesale voice, as well as the wholesale data and internet which has also slowed down pretty dramatically. Then second, maybe for Joe on CapEx, why should we anticipate CapEx levels to increase? I mean obviously we always have seasonality there, but it seems like with the project sort of running at a steady rate, I’m not sure we should see a big increase in CapEx towards the back half.

Okay Mike, on wholesale, on the voice side, we’ve made significant margin improvement on that. I don’t want to get into sharing the individual product margins, but I can tell you that a lot of the go to market strategy change that we made had a very positive impact on the margins and quite honestly, we were fairly aggressive in the latter part of last year with specific customers and specific products. So, I feel like we’ve kind of taken the pain if you will, of actually forcing some customers off a network and moving on some products and I feel that we’ve made pretty substantial improvement in margin. Now, do I think we’re going to be able to continue to have that kind of improvement quarter-over-quarter, probably not because of the aggressiveness to which we took it in the fourth quarter. In regards to your capital question, I mean I think if you look historically, we’ve been, pretty good about putting out, what our capital expenditures were going to be for the year and then sort of managing to that. So I think one of the things is when you think about the economy where it is today, and sort of the fewer number of housing starts that have been going on, this could come back in the latter part of the year. The other thing is typically in the fourth quarter, you’re getting a lot of planning work done to get started in your first quarter and then in your first and second quarter you’re sort of doing the planning for the latter part of the year. So I wouldn’t take the first quarter capital expenditures as a straight line that says we’re going to significantly beat the CapEx program for the year.

Hey Tom, just to circle back on the wholesale side; is this a pricing issue. I mean if you’ve got unprofitable customers that are migrating off, presumably they’re going somewhere else that has similar prices or is there a situation we you probably could have come up with a higher price point for these folks?

No Mike, that’s a great question, because during our most recent review I asked where do you think they’re going and I’ll let others figure out where they went. I’m just happy that we decided to get them offline network. It’s a pricing issue for us. We didn’t have the right kind of pricing relative to our costs and so it was a combination of changing the pricing to get it to be profitable and then changing the cost structure. So, it was actually both Mike, truthfully.

Okay. Thanks, guys. I appreciate it.

Our next question comes from the line of Mr. Peter Rhamey from BMO Capital Markets. Your line is open.

Great, thanks very much. Two questions, CapEx trends is a function of the economy going forward as a tag along to the last question. Joe, perhaps you could comment on capitalization of labor. Do you capitalize in proportion to capital spending, so this is a source of operating cost savings if you should choose to ramp labor in the second half of this year? The second question, you talked about the outlook in enterprise improving slightly, wholesale stable margins, could you address the consumer segment a little bit, what you saw in March and going into April? Thank you.

Sure, and so in regards to capitalized labor, I mean we obviously look at the specific functions and the work being done and make a specific determination, whether it’s capital or not. So it’s not something that’s sort of trended to dollars or anything; it’s based on specific work.

Yes. On the mass markets, we really didn’t see a significant change in the quarter like we did in the enterprise space on volume or activity. It was pretty much business as usual if you will. I think we feel really good that some of the retention initiatives that Dan and his team have implemented are starting to pay dividends as the outward movement of access lines was fairly flat, but you can clearly see it on the inward movement, the impacts of the economy. So, we’re going to continue to be diligent on protecting the base and hopefully even improving our churn numbers as far as outs and then take advantage hopefully when the economy turns around of increasing inward movement again.

Great, thanks very much, Tom.

Our next question comes from the line of Mr. Chris Larson from Piper Jaffray. Your line is open.

Hey, thanks for taking the question. A couple of questions for you Joe; the working capital savings that you had in the first quarter, do you feel like these are sustainable into the fourth quarter? Secondly, you talked about the network and facility cost savings and that was really helpful to see those breakouts, but can you give us a little more detail on that? Is that negotiating prices down on network elements and then is there closing facilities and is there more of that, do you think you can do? Lastly, you talked about the DSL speeds and hinted at some higher speeds that maybe coming; how high do you think you can get the FTTN to go in terms of data rates and then what percent of homes do you think are addressable with those higher data rates?

Let’s work backwards, why don’t you take…?

Okay. Yes, let me take through the data rates first and then I’ll take the facility costs and then we’ll move back over to Joe. We are actually starting to do some trials if you will, on taking our 20 megabit FTTN product to fairly significant higher speed. It’s a pretty new technology from a standards perspective, but I would expect as we get to the latter part of the year, assuming the trials go well and we get everything done the way we’d like to, that you’ll begin to see that part of the norm when we go to the marketplace as far as speed enhancement. The second question was on facilities cost. A lot of the improvement has come from two areas. One, it’s related to the wholesale strategy on LD, because as you drive those minutes off, you can drive off facility costs. A lot of it’s related to the wireless strategy, because as you drive those minutes off, you can drive off facility costs and then there is just the normal outstanding job that Bob and his team have done in grooming our network. Some of the fiber ring activity, we are talking about to enhance the footprint of the business markets group. If you remember last quarter, it kind of has a dual benefit to us. One is to enhance the speed to market, but it also gives you an opportunity to reduce the facility cost. So, it’s really in those three buckets. Joe.

On your last question on working capital, just a view that it’s going to be sort of consistent throughout the year, I don’t think we’re going to try to have any fluctuations up or down in any material way.

Great, I was just making sure there wasn’t some seasonality that we would see some cash flows out at the end of the year?

Yes, just the only point on that is my earlier remarks about sort of the quarters, typically what you’ll see in the third quarter is additional lift and expenses as a lot more repairs and maintenance goes on out in the field and so typically the second and third quarter either right equal to each other, one might be a little higher than the other, vice versa and then typically in the fourth quarter you get a better performance.

That makes sense. Then on the DSL with the fiber to the node, what percent of your lines are going to be ultimately addressable with this new sort of super powered fiber to the node that you’re talking about?

I think it’s too early to tell at this point. We’ve targeted about $3 million, to have $3 million homes passed by the end of the year. I think on previous calls we said we could see a view where we get to 60% to 70% of our base. Eventually it would have the fiber to the node footprint, but I can say this; once we get through the trial, it will become the standard way that we deploy it going forward.

Thanks a lot.

Our next question comes from the line of Mr. David Dixon from FBR. Your line is open.

Thanks for taking the question. The question really is to what extent the economy is driving an acceleration in the secular shifts from legacy voice services. I was wondering if you could help us with that just in recent months, we’ve seen some changes. Specifically one that if you could talk about some of the recent traffic trends that you’re seeing, particularly on the voice side in the high margin international voice segment? Secondly, just as a follow-up to the last question; I want to make sure that I understood that correctly, that we were talking about dynamic spectrum management. My understanding was that that was two and three years away in terms of being a standardized service and is the intent to roll this out ahead of the standards being deployed there and perhaps aggressively getting out in front of that? I just wanted to make sure I understood the strategy there. Thanks very much.

Okay. Hey David, it’s Tom. The first one is on the traffic trends, a lot of the LD, which is a big part of the minutes, at least from our perspective has been driven by our own initiatives. You are correct that we have seen some drop in international LD as a result of just a change in the economic climate, but I’d have to say, for us you’d still want to think about the proactive activities and the wholesale space is driving some of the minutes changes more so than just the general economic impact on our international LD. What I was referring to was the VDSO 2 technology, which is really what we’re trialing as a way to enhance download speed on to the network and as you know, we’ve finally got the start of some standards there and that will be the technology we’ll be deploying during the latter part of this year going forward.

Okay. Thanks very much.

Our next question comes from the line of Mr. Tim Horan from Oppenheimer. Your line is open.

Thanks. Joe, two quick questions if I may; do you think this is the worst of it in terms of year-over-year revenue declines? I know you’re not giving guidance, but just broadly speaking do you think we kind of improved from this quite forward as you’re looking at things? Secondly, I don’t know, if you do much benchmarking between yourself AT&T, Verizon, but those companies are seeing their wire line EBITDA margins declining 200 to 300 basis points and yours are kind of up to quite a bit from where we were a year ago. Why do you think that is and maybe what you think you’re doing differently than what they’re doing to enable something like that? Thanks.

Okay. So I guess Tom and I can both comment on the last one. I mean, we’ve talked about, managing work force to workload, our disciplined cost review across every line item on our P&L. There is not a manager in this company who doesn’t have the message that we are focused on running as efficiently and profitably as possible and therefore, there are so many efforts going across the company as a result of our great managers, to continue to take costs out of the company and that will continue to happen on a going forward basis. As far as the revenue decline, I want to make sure you understand that from a recurring revenue standpoint, we continue to grow the business. The things that you’ve seen impact revenue are the wireless transition, which is really a lot of an accounting issue and two, us eliminating unprofitable revenue. So as we sort of finish their transition over the year, you’ll get to some turning point where you’ll just see the recurring revenue continue to go up, but don’t get confused, when people look at our total revenue and when you get CPE and all of the transactional stuff, one quarter will have high transactional revenue and another quarter won’t and it distorts the real trend of the growing recurring revenue.

Thanks for that. Just a follow-up, I guess you did at $1.15 billion in EBITDA this quarter. Your guidance would suggest that the EBITDA per quarter going forward would be about $100 million or $100 less. I’m not sure if you’ve kind of spoken on this, but is there a reason why EBITDA would decline about $100 million per quarter for the remainder of the year, just providing broad average if there’s anything that would cause that? Thanks.

I think if you heard the question at the beginning of the call, someone did the math that suggested that if you looked at my run rate I could do better than sort of my current guidance and all I suggested that we’re only one quarter into the year. The economy is still totally unstable in my mind; unemployment continues to go up and therefore are we optimistic about what our future is? Without a doubt, but we’re not prepared to change the guidance at this time.

Okay, but there’s nothing in your mind that would cause it specifically to go down on a run rate basis, that this run rate is good other than economy?

Right I mean that’s a big issue in my mind.

Okay. Thanks so much.

Okay. Howard, we’ll take one more.

Our final question comes from Miss Donna Jaegers from DA Davidson. Your line is open.

Thanks, just two quick questions. AT&T was talking a lot on their earnings about making a lot of marketing progress with a naked DSL plus a wireless bundle. Since you guys now have wireless in a little better format with the Verizon product, have you thought about maybe a more aggressive stance that way to catch younger people?

Yes Donna. Yes, we have. We even have identified the specific segments where they are and how they buy and that has been an area where we haven’t done as well in the past, so a long-winded answer, the way of saying yes.

Okay and then just a quick question for Joe, the tax rate, the 31% that you guys had booked in the first quarter, should we expect that to normalize back up to 38%?

Correct.

Okay. Great, thanks.

Thanks everybody for joining us on our call this morning and if you have any follow-up questions, please feel free to contact us at investor relations. Have a good day everybody.

Ladies and gentlemen, thank you for participating in today’s conference. This concludes the program. You may now disconnect. Everyone have a wonderful day.