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Delivering BT’s 21st century network
Welcome
Presentations byPaul ReynoldsCEO, BT Wholesale
Matt BrossChief Technology Officer,BT Group
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Delivering BT’s 21st century network
Paul ReynoldsCEOBT Wholesale
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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 1995. These statements include, without limitation, those concerning: transformation of BT's networks and cost base; benefits to customers of the 21CN programme; anticipated capital spend on 21CN transformation and expected cash savings; timescales for delivery of 21CN; and delivery of instantly available broadband dialtone
• 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; and the anticipated benefits and advantages of new technologies, products and services, including broadband, not being realised. BT undertakes no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise
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Delivering BT’s 21st century network
Paul ReynoldsCEOBT Wholesale
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BT’s strategy is on track
Traditional focus
New wave focus
21CNtransformation
Long-term partnershipwith our customers
– Improved service– Aggressive & creative
marketing– Price innovation– Reduce costs
– Broadband– Mobility– ICT– Global Solutions
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A world where everyone has access to modern communications
0
20
40
60
80
100
April 200026%
July 200266%
November 200380%
May 200490%
Summer 200599.6%
Cov
erag
e %
Note:Percentage of homes and businesses connected to a broadband enabled exchange
Broadband availability in the UK
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OECD report
Source: OECD May 2004
DSL Availability in G7
2001 2002 2003 2004 2005
UK
Canada
France
Germany
Italy
Japan
USA
60
69
66
70
67.5
73.5
50
64
70
71
80
70
80
68
85
75.4
79
85
80
90
75
95
-
90
90
-
90
-
99
-
95
-
-
-
-
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This is good … but it’s not enough
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The changing landscape
• Convergence is gaining momentum
• Convergence needs an underlying infrastructureto deliver and support it
• Customers want more choice, flexibility and control
• Simplicity is key
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21CN - three key points
Speed to market
Customerexperience and empowerment
Costtransformation
• We will empower the customer with control, choice and flexibility like never before and offer them communications from anywhere to any device
• We’ll make exciting new services available for customers faster than has been possible before
• We’re reducing our costs – we’ll make growing cash cost savings which are expected to amount to £1 billion per annum by 2008/9
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21CN – what it means for BT
• Moving from narrowband to broadband
• Moving from selling capacity to selling capability
• Moving from a product focus to customer focus
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21CN - the radical strategy
• Broadband everywhere…
• Replacing the PSTN
• PSTN transformation trial
• A world first for a telecoms company
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Broadband dialtone
• By 2009, broadband dialtone will be instantly available to most BT customers in the UK
• Customers can switch lines to broadband use themselves
• No physical work is required at the exchange
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21CN – it’s big
•If that sounds big …it’s because it is
• Bigger annual investment than is spent on UK’s motorways and trunk roads
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21CN - aligning our investments
MSANProject
Bluephone
Flexible Bandwidth
BTRich Media
BT Communicator
Wholesale Web Call Connect
PSTN/Voice trial
Fibre trialConverged core
EDCService creation
Today Future
21CN - network architecture
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First mover advantages
• Supplier product alignment
• Technology start-up funding
• Shared learning and risk management
• Low costs
• Best in class whole life costs
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21CN - a new partnership approach
• With all our customers
• With the global vendor community in IT and traditional telecoms
• This is unique in our industry
• Focus on whole life costs
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IP
ATM
PSTN
DSL
KStream
PSTN DPCN
PDH
Fibre
Copper
DWSS
ASDH
EndUser
~5knodes
~2knodes
~400nodes
~100nodes
~15nodes
MSH -SDH
~1knodes
Mesh -SDH
Inter-node transmission provided by
SDH/PDH platforms
CWSS
21CN - our current network
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IP-MPLS-WDM
DSL
Fibre &Copper
Copper
Agg Box
EndUser
~5knodes
~100nodes
Class 5 Call Server
Content
WWW
ISP
21CN - our simplified networkPSTN Migration Converged Core
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21CN - quality
• 21CN services delivered at the same or better quality as we do today
• 21CN will raise the quality threshold traditionally associated with IP to PSTN standards and better
• We are designing this level of quality into 21CN
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21CN - systems
• Concurrent systems transformation
• Designed to enhance the customer experience
• Empowering the customer with greater control
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21CN - common capability building blocks
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21CN - key milestones
2004
2005
2006
2007
2008
Broadband available to 99.6%Strategic vendors announcedBroadband growth on MSAN/combo cardsFirst new service launches based on re-usable capabilities
Mass PSTN migration begins17 new product launches/enhancements based on re-usable capabilitiesNew operations & service management capability in place
Broadband dialtoneavailable tomost customers
Large scale non PSTN service migration begins
2009
Mass PSTN migration reaches more than 50% of customers
PSTN transformation trialDeep fibre trialConverged networkService creationExperience development centre
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Key messages
• We’re making broadband available everywhere
• But convergence is creating new opportunities and new customer expectations
• 21CN is a radical transformation for BT
• Narrowband to broadband; capacity to capabilities; product to customer focus
• Announcing important trials on PSTN and fibre today
• Timetable for large scale roll-out outlined
• You’ll hear much more over time
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Implementing BT’s21st century network
Matt BrossChief Technology OfficerBT Group
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21CN – activities 2004
PSTN trial
Servicecreation
Experience development centre
Converged network
Deep fibre trial
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PSTN trial
What and where?• Seamless bypass of core PSTN
network links between three major network nodes (Cambridge, Woolwich London and Faraday London )
• Voice calls between enabled nodes diverted to IP/MPLS network
• End to end calls between enabled customers carried exclusively over IP
• Installation of new MSAN equipment at 18 exchanges in London, Kent and East Anglia
• Equipment includes softswitch, MSANs, media servers and media gateway cards
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PSTN trial
When?
• Next generation voice services to first 1,000 customers ‘live’by end January 2005
• Further 3,000 customers ‘live’ by June 2005
• Major roll-out to all regions begins 2006
• Broadband dialtone to most customers by 2009
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PSTN trial
Why?• Allows us to monitor transition and robustness pre
large scale migration of all PSTN services to 21CN from 2006
• Helps test quality of services is as good as, or better than, PSTN
• First steps towards 21CN
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Deep fibre trial
What and where?• Trials of deep fibre in access
network – to the cabinet and to the premises
• Designed to test the investment, operational, technology and business case
• Providing telephone and broadband via fibre to 1,500 homes
• Trials in Suffolk, Milton Keynes and London
Fibre
Copper
PCP
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Deep fibre trialWhen?• First trialists will have fibre lines
installed and working by October 2004
• Trials to run until September 2005
Exchanges
• Kesgrave exchange, Martlesham Heath
• Bradwell Abbey exchange, Milton Keynes
• Albert Dock exchange, London Docklands
Why?
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Converged network
• Reducing complexity of our infrastructure
• Eliminating 100,000 network components and significant cost
• Establishing a single platform that is multi-service and future proof on IP
• Optimised for reliability and performance
• Closely aligned to PSTN transformation
• Phased roll-out begins this year
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Service creation framework
• Applying the development approach from IT software industry to telecoms
• Creating series of reusable, common capabilities
• First 9 components created 2004/5
• 17 new products or enhancements based on these components to be launched 2005/6
• Increase automation and accelerate time to market for new services
• Help contribute to cost reduction
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Experience development centre
• An environment where operations, portfolio, systems and networks are brought together
• Prototype new services, platforms and processes
• Increase speed to market
• Drives the delivery of the end to end customer experience
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21CN - key points
• 21CN is the enabling infrastructure for growth at BT and for its customers
• The most ambitious business transformation programme in communications worldwide
• Represents a major investment by BT
• Will put UK at the forefront of communications innovation
• We are delivering now
• Large scale vendor engagement starts today
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&Q AQuestions can only be takenfrom the BT Auditorium
Delivering BT’s 21st century network
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Delivering BT’s 21st century network
Thank you