11

IT Expo West 2010

General Session: Cloud ComputingNigel WilliamsSVP Sales

22

2009 Annual Revenue: $3.7B

Employees: 5,200

Legacy and pedigree in support of wholesale customers with a pure IP fiber optic network

Supporting mission critical applications for 000’s of enterprise customer

Majority of Tier 1 cloud providers & SI’S on-net with Level 3 TODAY

Level 3 Today

53,000 intercity route miles and more than 27,000 metro route miles

More than 100,000 buildings lie within 500 feet of the Level 3 network

Network and telephone numbers in rate centers serving over 85% of U.S. households

CLEC provider in all 50 US States

33

Industry Dynamics – The IT Managers Nightmare

Customer Expectation

Tolerance

OPEX

Regulatory

ISV Model

= Capacity Planning Nightmare

Loyalty

Real-Time

44

How do you plan for so many variables?

Application Capacity/ScalabilityDR and Replication

Data Center CapacityPrivate or HostedServer Capacity

VirtualizationProcessing Capacity

Network Capacity

55

ON DEMAND SERVICES

FLEXIBLE PRICING MODELS

LOWER COSTS

RESOURCE POOLING

IMPROVED SLA’S

So What Enterprise IT Managers Want…. again

ELASTIC CAPACITY

DELIVERY OF SOFTWARE APPLICATION

DATA STORAGE, RETREVAL AND MANIPULATION

ON DEMAND PROCESSING CAPACITY

66

Cloud Adoption Today

Non Mission Critical Application

Success primarily in SMB

Network Connectivity thruPublic Internet

Security Implications

Regulatory Compliance

Application Sensitivity

Enterprise SLA’s ???

77

Application Sensitivity Impacts Cloud Adoption

Would

ISV

PaaS

PUBLICINTERNET

OPEN/INTERACTIVEWEB BASED APPLICATION

88

Network Access Methodology Impacts Application Performance and Customer Experience

Public

Shared Software

Shared Computing

Shared Network Delivery

Private

Dedicated Software

Dedicated Computing

Dedicated Network

99

Leveraging the Level 3 infrastructure to deliver differentiated access

Level 3 Adaptive Cloud

Cloud Services Business Users

Cloud providers will offer services differentiated by

application sensitivity, criticality, QoS and performance

Access methodology varies by segment and application sensitivity

One size does not fit all

The cloud must deliver the right quality of service and security

SMB

Finance &Healthcare

Retail & Manufacturing

Large Enterprise

ConsumerPaaS

BUSINESS CRITICAL

SECURITY SENSITIVE

LATENCY SENSITIVE

Private Line(SONET)

NON CRITICAL

Private VPN(MPLS)

IaaS

Wavelength(DWDM)

The InternetSaaS

1010

Tier 1 Cloud Service

Providers

Tier 2 Cloud Service

Providers

Communitiesof

Interest

FinancialServices Providers

HealthcareSolution

Providers

Entertainment and MediaSolutions

Mid-Marketand state/local

gov.

Large Enterprise

Communitiesof

Interest

Financial ServicesOrganizations

Healthcare Providers

Media and Entertainment Industry

Level 3 – Delivering the Adaptive Cloud

Leveraging the scale of our network to

connect enterprise

customers to multiple cloud

providers

1111

IBM and Level 3 at NAB – Media Workflow

1212

Level 3 Approach to Cloud Services

All the components are complex but exist today - business models need to adapt

Alliances and partnerships are key to enterprise flexibility and innovation

Focus on core business and not compete with solution providers and VAR’s

Enable SI’s, VAR’s, and Agents that wish to sell and deliver cloud services

Continue to expand network footprint directly to cloud providers and enterprise customers

1313

Summary

Bringing together buyers and sellers over a network optimized for cloud delivery

Industry trends and complex capacity planning driving cloud services

Enterprises demand differentiated access based on application sensitivity

Level 3 will leverage network infrastructure and strategic partnerships to meet enterprise demand

Level 3 creates an opportunity for agents/VAR’s that want to play in this market