1. Tim Wright BT’s 21st century network TRIS - TISPAN WG4 workshop on NGN Interconnection and Numbering Copenhagen 18 January 2006 21CN Principal Consultant BT Wholesale

2. 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 1995. These statements include, without limitation, those concerning: transformation of BT's networks; expected increased efficiencies, cost reductions and growing cash cost savings from 21CN; benefits to customers and industry of the 21CN programme, and convergence; anticipated investment in 21CN; and timescales for implementation of 21CN. 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 results may differ materially from those expressed or implied by these forward-looking statements. Factors that could cause differences between actual results 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; future regulatory actions and conditions in BT’s operating areas; technological innovations; developments in the convergence of technologies; the anticipated benefits and advantages of new technologies, products and services, including broadband, not being realised; and general financial market conditions affecting BT's performance. BT undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. Forward-looking statements - caution advised

3. Commercial Pressures

4. Change and innovate … or die

5. Source: point Topic Broadband lines in the UK

6. About 18 million UK broadband could crash into the ceiling soon

7. BT’s response to the Market Traditional focus New wave focus 21CN transformation Long-term partnership with our customers –Improved service –Creative marketing –Price innovation –Cost leadership –Broadband –Mobility –ICT –Global solutions

8. 21CN - three key goals Empower the customer with control, choice and flexibility like never before including communications from anywhere to any device Offer exciting new services for customers faster than before Reduce costs and grow cash cost savings Speed to market Customer experience and empowerment Cost transformation

9. control, choice and flexibility 21st century network will empower customers with like never before What it means for customers

10. End User ~5.5k sites ~2k sites ~300 sites ~100 sites ~15 sites ~1k sites IP DSO leased lines PDH PSTN SDH VC-4 SDH VC-12 ATM PSTN DSL L’line PDH access SDH access Copper Fibre Complex, expensive, restrictive…. BT’s current network architecture

11. End User ~5.5k sites ~110 sites Multi-service accessConverged core IP/MPLS/WDM Copper Fibre & Copper DSL Aggregation Call Servers WWW Content Wireless The infrastructure to enable seamless integrated communications BT’s 21CN network architecture

12. 21CN common capabilities Applying the development approach from IT software industry to telecoms Creating series of reusable, common capabilities Increasing automation and accelerating time to market for new services Contribute to cost reduction Illustrative examples

13. 21CN - key milestones 2004 2005 2006 2007 2008 2009 Strategic vendors announced Broadband growth on MSAN/combo cards First new service launches based on re-usable capabilities; broadband available to 99.6% Migration begins 17 new product launches/enhancements based on re-usable capabilities New operations and service management capability in place Voice transformation trial begins; access fibre trial begins Converged network work begins Service creation framework work begins Experience development centre work begins Programme nears completion Mass migration continues Customer and equipment migration underway Large scale non PSTN service migration begins Mass migration reaches more than 50% of customers

14. Early focus Voice –PSTN replacement - driven by obsolescence of existing platform –future voice - new features, perhaps part of a multimedia service Broadband –ensure the ongoing growth for consumer broadband is met by 21CN Ethernet –ensure the growth of ethernet services for businesses and comms providers is met by 21CN

15. 21CN - preferred technology suppliers IP/MPLS AccessMetroCoreTransmissionI-node

16. 21CN mass migration: roll-out begins Expected to begin in the second half of 2006 In the Cardiff area of south Wales Migrating 350,000 customer lines Replacing 9 digital local exchanges Installing new equipment in over 70 BT sites

17. The human challenge Customers Government Vendors Regulator Public policy... unique in our industry

18. www.btwholesale.com/consult21 Consult21 objectives Achieve a shared understanding with our customers on 21CN Ensure customers are aware of the 21CN vision and BT’s progress towards it Ensure customers have an opportunity to input to 21CN development

19. Some interconnection issues Defining and exposing common capabilities Equivalence of input (key part of regulatory settlement) Maturity of standards Charging principles Location of points of handover Converged points of handover

20. Existing BT PSTN Conc Local switch Local switch Tandem switch Where are the PSTN interconnects in the UK ? Emulated PSTN on 21CN MSA N Metro node MSA N Metro node 5500 sites 110 sites 5500 sites 300 sites 70 sites Tandem switch Logical points of voice service interconnect The physical Points of Handover may be remote from the switch site NG physical PoH (at up to 1100 MSAN sites) Logical points of voice service interconnect to legacy networks Tandem switch Tandem switch

21. Comms provider AComms provider B Converged points of handover Interconnect products Customer of CP A Customer of CP B Session control Switching/routing Service access products Customer of CP B Session control Switching/routing Network builder products Premise of CP B Switching / routing Multi-service point of handover

22. “Technology is not kind. It does not wait. It does not say please. It slams into existing systems. Often destroying them, while creating new ones” Joseph Schumpeter (1937) The Inter-Human Web has arrived Outlining the revolution

23. Thankyou