21CN Legacy Interconnection Working Group 17 th December 2004 Auditorium City Place, Gatwick

Agenda The purpose of the Working Group meeting today is to discuss the maintenance of existing legacy interconnect services during the establishment of the 21CN network. To this purpose,after previous discussions and feedback from industry, BT will present a proposal setting out the commercial arrangements arising from the physical changes to the network. In addition BT will set out a proposal for the future architecture/routing arrangements for discussion and to obtain industry’s feedback

Agenda Introductions Purpose of meeting BT’s commercial proposal Operational Issues Contractual aspects and timescales Discussion

LEGACY INTERCONNECTION IN 21CN 17 DECEMBER 2004 ANTHONY SHEPPARD SENIOR PORTFOLIO STRATEGY MANAGER

FORWARD LOOKING STATEMENTS - CAUTION ADVISED Certain statements in this presentation are forward-looking and are made in reliance on the safe harbour provisions of the US Private Securities Litigation Reform Act of These statements include, without limitation, those concerning: BT's plans for transformation of its networks; benefits to customers of the 21CN programme; key milestones and expected timetable for delivery of 21CN; and the benefits in relation to, for example interconnect, convergence and broadband Although BT believes that the expectations reflected in these forward-looking statements are reasonable, it can give no assurance that these expectations will prove to have been correct. Because these statements involve risks and uncertainties, actual outcomes may differ materially from those expressed or implied by these forward-looking statements Factors that could cause differences between actual outcomes and those implied by the forward-looking statements include, but are not limited to: material adverse changes in economic and financial markets conditions in the markets served by BT; supplier arrangements; future regulatory actions and conditions in BT’s operating areas; technological innovations; developments in the convergence of technologies and the anticipated benefits and advantages of new technologies, products and services, including broadband, not being realised

AGENDA BACKGROUND & GENERAL PRINCIPLES COMMERCIAL PRINCIPLES COMMERCIAL PROPOSALS

What is 21CN and why is change beneficial for the industry? 21CN represents a multi-billion pound capital investment by BT for the benefit of the industry and the industry's customers 21CN is the enabling infrastructure for growth and opportunity for the industry 21CN will enable compelling new products and services for all operators to market to their customers. BT is committed to working closely and openly with industry to ensure that the benefits are maximised for operators, the economy and society. For discussion purposes. No implementation assurances Subject to Contract

BT’s Approach to Interconnect Portfolio Continue to provide any-any voice connectivity in consultation with customers Work with customers to ensure appropriate inter-operability of new services, for example through access to “network hooks” Provide new forms of Interconnect for the new IP world Discharge its regulatory obligations in a professional manner Minimise inconvenience to customers during the implementation of 21CN Support reasonable ongoing requirements for TDM interconnect until 2010 For discussion purposes. No implementation assurances Subject to Contract

Principles An equitable, but affordable commercial agreement. BT will not indemnify altnets from investment risk due to obsolescence (e.g. Dial IP over the coming years) Recognise Ofcom’s policy of encouraging infrastructure build-out. Recognise the re-arrangement process is years long and the interconnect picture will be changing between offer and implementation.

Interconnect at DLEs For discussion purposes. No implementation assurances Subject to Contract

Key Migration Issues for Customers BT closes switches - Customer traffic must be rearranged Value of POCs at non-NGS sites ISI users at DLE-only sites face biggest disruption FRIACO at DLEs expected to die due to broadband penetration How will SIA Systems Alteration clause be applied? Under existing contractual terms, the change process is designed for BAU rather than large tranche one-offs What happens to DLE conveyance rate? For discussion purposes. No implementation assurances Subject to Contract

BACKGROUND & GENERAL PRINCIPLES COMMERCIAL PRINCIPLES COMMERCIAL PROPOSALS

Contractual Principles & Issues SIA Systems Alterations Clause BT meets reasonable agreed costs of network engineering alterations to Operator network Connection Charge rebate applies if Capacity is ceased (SIA, Ann. A, App. B, 4) But current contract terms ineffective for large one-off network changes We need – upfront agreement on criteria for Operator cost reimbursement early agreement on terms & process for dealing with complex alterations to provide certainty for both BT and our customers For discussion purposes. No implementation assurances Subject to Contract

Backhaul from Closing DLEs All backhaul Connection costs met by BT Ongoing backhaul circuit costs met by BT for 6 months Applies to ISI Voice only at all closing DLE switches CSI: BT will simply re-point or cease circuits as agreed with customer Signalling aspects: IUP traffic backhauled to NGS ISUP circuits may be extended to Metro Node on same terms by agreement, if required FRIACO Decline in demand needs to be managed collectively by industry Need to consolidate off DLEs? Your views invited For discussion purposes. No implementation assurances Subject to Contract

Conveyance Charges for Re-located DLE Circuits Local Call Termination will continue to be charged for 6 months smooth impact of loss of competitive model based on legacy architecture Applies to ISI Voice at all closing switches Dial IP Residual demand needs to be managed collectively by industry to meet remaining end users’ requirements Need to consolidate off DLEs? Specialist ad hoc group? Your views invited

Views and Comments please! Is there a better way of doing this?

Annex A: Can I install Capacity after Notice of a Switch Closure? BT proposals From date Notice given under SIA: New POCs for new customers or orders for new transmission systems/IEC access at customer’s risk (BT will not meet any costs of rearrangement or backhaul); Local Call Termination not available after DLE closure; Customers may bring into use spare capacity on existing ISI transmission systems already installed before Notice given and qualify for BT proposals on backhaul and Local Call Termination. From 7 months before Closure Date: No new POCs accepted; No new capacity or IECs to be ordered; Customers may bring into use spare capacity on existing ISI transmission systems already installed before Notice given and qualify for BT proposals on backhaul and Local Call Termination. From Closure Date: No expansion of capacity allowed under SIA; Installed capacity on existing ISI transmission systems brought into use will no longer qualify for BT proposals on backhaul and Local Call Termination

21CN Metro node (ISUP) Today NGS (IUP / ISUP) PoC IEC IEC (ISUP) IEC (IUP/ISUP) IEC (ISUP) Annex B: Proposed Architecture Conc DLE NGS MSAN New interconnect: IP or ISUP 4. If required, operators with IECs to closing DLE have IEC redirected to NGS, if IUP is retained 3. If required, operators with PoC at closing DLE provided with IEC to NGS, if IUP is retained 1. IUP not available on 21CN 2. IUP continues to be available on NGS until withdrawal. Anticipated at the end of 21CN implementation For discussion purposes. No implementation assurances Subject to Contract

Maintenance of Legacy Interconnect - Operational Issues Mark Ward Head of Interconnect and Numbering Services BT Wholesale - Network Design and Implementation

Typical Existing Architecture CP Switch NGS Conc DLE Conc TXMTXM TXMTXM DLE Conc TXMTXM TDM I/C IUP/UK-ISUP IEC DLE SITE NGS SITE Note - 90% all ISI Capacity passes through an NGS site.

Example of Future Architecture Signaling Gateway Call Server 21 CN Voice / Data Sig Metro Node TDM IP CPs TDM Gateway

Interim Arrangements Signaling Gateway Call Server TDM Gateway 21 CN Voice / Data Sig Metro Node NGS TDM CP Switch IUP/UK-ISUP UK-ISUP

Process Tied to agreement on Commercials and new System Alteration Process (SAN) Intend to provide SANs in tranches - 1year at a time (?) Detailed discussions and agreement with Technical Account Managers on transfer method required. Detailed programme with dates fully agreed. Routes moved off closing DLEs approx. 6 months in advance of DLE closure (prevents dependency and any late running problems as previously experienced)

Transfer Scenario examples 1.Capacity no longer required - Cease 2. Capacity available at NGS - Cease & data-change 3. Capacity provided via NGS site - Re-jumper at NGS 4. Capacity provided via non-NGS site - provide Backhaul 5. UK-ISUP - direct MGW connection available if required. 6. Route Consolidation possibilities. 7. CSI - BT termination transferred as agreed

Example of detailed Transfer Scenario The following is an example of work in progress to define a range of transfer scenarios for discussion with individual CPs.

DLE 1 Figure 1 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity Interconnect Scenario Before Transfer DLE1 SITE   NGS SITE DLE2 SITE IEC 14 E1s 3 E1s 10 E1s (BH use 6 E1s) 4 E1s 12 E1s CP NGS DLE 2 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   NGS SITE DLE2 SITE IEC 18 E1s 3 E1s 10 E1s (BH use 6 E1s) 4 E1s 15 E1s CP NGS DLE 2 Figure 2 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity Preliminary DLE to NGS Route Enhancement 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   NGS SITE DLE2 SITE IEC 18 E1s 3 E1s 10 E1s (BH use 6 E1s) 4 E1s 15 E1s CP AAR NGS DLE 2 Figure 3 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 1 Transfer - Stage 1 21CN21CN MGWMGW MSAN METRO NODE

NGS DLE 1 DLE1 SITE   NGS SITE DLE2 SITE 18 E1s 3 E1s 10 E1s (BH use 10 E1s) 4 E1s 15 E1s CP AAR DLE 2 Figure 4 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 1 Transfer - Stage 2 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   NGS SITE DLE2 SITE 18 E1s 3 E1s 10 E1s (BH use 10 E1s) 4 E1s 15 E1s CP NGS DLE 2 Figure 5 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 1 Transfer - Stage 3 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   NGS SITE DLE2 SITE 18 E1s 3 E1s 4 E1s 15 E1s CP NGS Combined Route 10 E1s DLE 2 Figure 6 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 2 Transfer - Stage 1 Circuits grown onto NGS Route Combined Route 14 E1s (BH use = 13 E1s) Used for DLE 1 and DLE 2 traffic 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   DLE 2 NGS SITE DLE2 SITE 18 E1s 3 E1s 4 E1s 15 E1s CP NGS Combined Route 10 E1s AAR Figure 7 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 2 Transfer - Stage 2 Combined Route 14 E1s (BH use = 13 E1s) Used for DLE 1 and DLE 2 traffic 21CN21CN MGWMGW MSAN METRO NODE

DLE 1 DLE1 SITE   DLE 2 NGS SITE DLE2 SITE 18 E1s Combined Route 14 E1s (BH use = 13 E1s) Used for DLE 1 and DLE 2 traffic 4 E1s 15 E1s CP NGS Combined Route 10 E1s Figure 8 - Option ‘A’ - Transfer Using CP to NGS Route Spare Capacity DLE 2 Transfer - Stage 3 21CN21CN MGWMGW MSAN METRO NODE

Information Provision Metro Node list on NIPP - still subject to revision - detailed address info via NISCC. DLE closure timetable as soon as reasonably stable Detailed per CP information per DLE provided with SAN Completed Transfer of BT number ranges to NGN advised probably via NIPP.

Any Questions or Comments ?