1. © Copyright 2003 Personeta Inc. Confidential The Next-Generation Intelligent Network The Case for IP “Centrex”

2. Confidential2 Centrex was a Good Idea  Key Assumption: Few intrinsic benefits to organizations from owning and maintaining PBX equipment  However, Centrex did not evolve with the times Lacks support for mobility, IP/IT applications and services, and geographical distribution of branch offices  Traditional Centrex is inflexible Device (Class 5) based Expensive to implement, manage and maintain

3. Confidential3 There is a Market for Centrex  In 2001, there were 16.5 million lines served by Centrex (Frost & Sullivan) At an average of $5/month per served line this represents annual revenues of nearly $1 billion  Compelling business case for customers: While an organization with 500 lines will pay $30K annually in basic Centrex subscription fees Versus fully-burdened annual salary of a PBX system administrator is $80K (plus capital expense, etc.)

4. Confidential4 IP “Centrex” - Two Approaches  Soft Switch Approach Class 5 replacement with most traditional Centrex limitations Does not serve existing Centrex customers or migrate  Network-Based Approach Device independent, avoiding inherent limitations Provides service to both IP and traditional customers Centrex features without limitations

5. Confidential5 TappS  Enables Network Solutions PSTNVoIPMobile TappS  NSC Service logic maintained in centrally manageable location Uninterrupted service for existing customers IP customers receive latest bells and whistles IP media servers replace VRUs for IVR Mobile employees remotely accessible Remote branches integrated into numbering plan Taveling employees have virtual office IP Data Network

6. Confidential6 Thinking Outside the Service Box  Any service is a bundle of features  Different customers require different features All customers don’t need all features all the time (and they don’t want to pay for them!)  Features combined in different ways redefine the service and its chargeable value to the customer  Flexibility presents, in itself, compelling value for the end-customer!

7. Confidential7 Voice VPN Number Translation Feature Layering Small and medium size businesses pick and choose service features for unique bundles “Premium” features leverage underlying layers for high-end customers Call Handling Network IVR Advanced Routing Voice Portal Basic PBX features

8. Confidential8 Feature Bundling – an Example Private Numbering Plan (PNP) Call Hold Call Transfer Call Forwarding Closed User Group (CUG) Outgoing Access Privileges Private Numbering Plan (PNP) Call Hold Call Transfer Call Forwarding Closed User Group (CUG) Outgoing Access Privileges Abbreviated Dialing Direct Inbound Dialing (DID) Abbreviated Dialing Direct Inbound Dialing (DID) Time-of-Day Routing (TDR) Do-Not-Disturb Routing (DND) Origin-Dependent Routing (ODR) Time-of-Day Routing (TDR) Do-Not-Disturb Routing (DND) Origin-Dependent Routing (ODR) Auto-Attendant Enterprise Directory Advanced Speech Recognition (ASR) Basic package = $3.50/line/month Each feature = $.75/line/month Each feature = $1.50/line/month Package = $3.50/line/month Package = $2.50/line/month

9. Confidential9 Feature Bundling – an Example Private Numbering Plan (PNP) Call Hold Call Transfer Call Forwarding Closed User Group (CUG) Outgoing Access Privileges Private Numbering Plan (PNP) Call Hold Call Transfer Call Forwarding Closed User Group (CUG) Outgoing Access Privileges Abbreviated Dialing Direct Inbound Dialing (DID) Abbreviated Dialing Direct Inbound Dialing (DID) Time-of-Day Routing (TDR) Do-Not-Disturb Routing (DND) Origin-Dependent Routing (ODR) Time-of-Day Routing (TDR) Do-Not-Disturb Routing (DND) Origin-Dependent Routing (ODR) Auto-Attendant Enterprise Directory Advanced Speech Recognition (ASR) X 100 lines = $350 X 100 lines = $75 X 100 lines = $150 X 50 lines = $75 X 100 lines = $350 X 100 lines = $250 X 100 lines = $75 Total Monthly Cost = $1,325

10. Confidential10 Promotional Bundling – an Example Carrier Transport Networks Carrier Data Network OSS/BSS Realtime Charging Engine Promotion: Take the Basic Hosted IP PBX Package and get 3000 free minutes of off-net calls per month. TappS  NSC DEBITDEBITDEBITDEBITDEBIT

11. Confidential11 Promotional Bundling – an Example Carrier Transport Networks Carrier Data Network OSS/BSS Realtime Charging Engine Promotion: Take the Basic Hosted IP PBX Package and get 3000 free minutes of off-net calls per month. TappS  NSC BILLBILLBILLBILLBILL Balance = 0

12. Confidential12 Value for Service Providers  Differentiation that retains valued customers and opens new SMB opportunities  Allows extension of existing resources with next-generation features  Subscription oriented, rather than relying on declining network access charges  Offloads significant provisioning tasks to the customer to widen operating margins  Enables creative marketing of feature bundles at low cost (and low risk)  Increases opportunities for penetration of other network-based business voice services

13. Confidential13 Value for Customers  Compelling alternative to buying and maintaining an IP PBX  Flexible, customizable feature bundles to better meet specific enterprise needs  Self-provisioning to enable customization monthly, daily… even hourly  Charging based on features actually used rather than monolithic service

14. Confidential14 Conclusion  There is a real market for hosted IP PBX “Centrex-type” features  Simply changing the device does not overcome the inherent limitations of Centrex Requires a service-centric approach that delivers features across networks  Flexibility and creating chargeable value are key issues

15. © Copyright 2003 Personeta Inc. Confidential Thank You www.personeta.com