1. Clive Feather 6 May 2005 Virtual IECs – playing the game © Copyright THUS Group plc 2005. All rights reserved.

2. TODAY DLE A NGS RCU DLE B Altnet 12xE1 to NGS 4xE1 to DLE A 4xE1 to DLE B IEC

3. © Copyright THUS Group plc 2005. All rights reserved. BT’s COMMERCIAL OFFER Replace physical IECs (and IBLs) by virtual ones Routes amalgamated Calls over virtual IECs charged at DLE rate via billing system magic Opportunity to increase/decrease virtual IEC size (?)

4. © Copyright THUS Group plc 2005. All rights reserved. TOMORROW DLE A NGS MSAN DLE B 20xE1 to NGS XX 4xE1 virtual IEC to DLE A 4xE1 virtual IEC to DLE B Altnet

5. © Copyright THUS Group plc 2005. All rights reserved. QUESTION 1 What happens when I reduce the size of the route to the NGS? StatMuxing means I probably don’t need 20xE1. 15xE1 will do. Presumably I reduce the virtual IECs proportionally? Or do I?

6. © Copyright THUS Group plc 2005. All rights reserved. TOMORROW (shrunk a bit) DLE A NGS MSAN DLE B 20xE1 to NGS XX 4xE1 virtual IEC to DLE A 4xE1 virtual IEC to DLE B 3xE1 virtual IEC to DLE A 3xE1 virtual IEC to DLE B 15xE1 to NGS Altnet

7. © Copyright THUS Group plc 2005. All rights reserved. QUESTION 2 How does overflow work in the virtual world? After all, all the traffic runs over a single route.

8. © Copyright THUS Group plc 2005. All rights reserved. OVERFLOW TODAY DLE A NGS RCU DLE B 110 calls over IEC 120 calls over IEC 10 calls overflow Charged at ST rate 110 calls 130 calls Altnet

9. © Copyright THUS Group plc 2005. All rights reserved. OVERFLOW TOMORROW DLE A NGS MSAN DLE B 240 calls from NGS But at what rate? XX 110 calls 130 calls Altnet

10. © Copyright THUS Group plc 2005. All rights reserved. THE ISSUE Virtual IECs cost real money. I don’t want to pay for more than I need. So how do I (or BT) decide how many I need?

11. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 1 No overflow. DLE routes are limited only by the NGS route size. Easy to administer. So why don’t I just reduce all virtual IECs to 1xE1? Oops!

12. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 2 No overflow. Virtual IEC sizes fixed at the date of virtualization. Still easy to administer. Unfair in the face of real traffic reductions. I can just reduce the IEC to 1xE1 the day before.

13. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 3 Analyze call records to determine how many would have overflowed. True virtualization, exactly matching real IECs. Complicated software development needed. How do Altnets reconcile BT’s bills? Fertile ground for disputes.

14. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 4 Price adjustment factor. Virtual DLE traffic is charged at a small premium over real DLE traffic to compensate for lack of overflow charges. Larger premium for smaller routes? Unfair on those who sized their routes correctly.

15. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 5 Use the Erlang formula. Say the virtual IEC is 3xE1 and the actual traffic is 74 Erlangs. Then the block probability is 0.86%. So 0.86% of call-minutes are deemed to have overflowed and are charged at ST rate. Can refine by separating D/E/W. Doesn’t distinguish steady from “bursty” traffic. Can your accounts department understand it?

16. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS Steady traffic, about 0.5E per channel Bursty traffic, about 0.5E per channel STEADY v BURSTY

17. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 6 There is no proposal 6.

18. © Copyright THUS Group plc 2005. All rights reserved. PROPOSALS PROPOSAL 7 someone else thinks of some proposals. The End I propose…