Delivering BT s 21st Century Network

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1 Expert s Forum Delivery BT s 21st century network Delivering BT s 21st Century Network By By Wei Matt Leping Beal The technology and economics that underpin the communications industry are changing and are changing the way customers will want to communicate. Convergence, long talked about, is now gaining traction and we believe it will continue to build momentum. BT plans to be one of the key engines that drives that change. Exploiting the opportunities that this converging landscape represents requires an underlying infrastructure that can support and deliver it efficiently. Building this enabling infrastructure is what BT s 21st century network (21CN) program is all about. It is aimed primarily at developing a truly customer-focused, efficient, network that will allow communications from any device to any device across an IP-based network. BT believes 21CN is the most ambitious and exciting business transformation program underway in the industry, anywhere in the world. It represents a major investment by BT that will put its customers at the forefront of innovation in communications worldwide. Under the leadership of Paul Reynolds, Chief Executive, BT Wholesale, 21CN is fundamentally reshaping BT s business. Overview T elecommunications is fundamental to today s society the ability to communicate is the lifeblood of modern society. Communications networks are a vital part of any economy. Continued innovation and investment are set to release the full potential of communications and improve the quality of peoples lives through better access to information, through economic growth and through simply being able to stay in-touch. BT believes that to be successful in the future it must move from narrowband to broadband; from selling capacity to selling capabilities and from a product focus to customer focus. And, in parallel, convergence is gaining momentum with the boundaries between voice, data and video, between computing and telecoms becoming increasingly blurred. BT is determined to be forward looking, both for the sake of its customers and its own market, financial and technological needs. 21CN is a fundamental and radical company-wide program to enable a new generation of richer and personal services that will transform peoples personal and business lives. For customers, the end result will be a complete experience one based on convenience and ease of use of all communications services including mobility, advanced voice, video and data services. Putting the Customer First Everything starts and ends with the customer. And there is so much that can be done to improve the customer experience. In the past, BT provided a series of separate products and services created by disparate technologies many of them excellent in their own right. But they haven t been integrated with each other, and they ve all had their own separate systems and service management. However, we can already see the shape and reality of a 1

2 Huawei Technologies joined-up and complete customer experience. It means families with integrated communications able to communicate via a range of devices such as the TV, stereo, set-top box, computers, screens and personal digital assistants (PDAs). It means people working in offices with integrated communications services that are smart, intuitive, scalable, and secure in which people can access whatever data they need, whenever they need it, over whatever device they choose. Customers want freedom to communicate and of how and when they want to communicate which means a simple, integrated, seamless communications experience. If this can be provided, then the industry will really start to grow again. It is the service that the customer experiences, not the technology that delivers it, that is important. An Integrated Approach BT needs a future-proof, flexible, intelligent network to enable the company to deliver communications services that will meet its customers requirements in the coming decades. BT has a very clear vision of where it wants to be and is now taking specific steps towards that goal. BT s transformation program has three key objectives (Figure 1): to revolutionize the customer experience; to improve the speed of market delivery of exciting new products and services; and to enhance cost efficiency. And BT is seeking to achieve these all at the same time. BT is taking an integrated approach to 21CN. It has been investing in some of the Speed to Market Figure 1 Cost Transformation Customer Experience and Empowerment 21CN-three key points 21CN building blocks in recent years to create the right business foundations. BT s commitment to making broadband ubiquitous, its mobility strategy and some of its tactical network investments are important enablers. BT will manage the seamless transformation into the converged world in parallel with the management of the traditional business it has today. The company will continue to maintain its legacy networks and services as it transitions. Transforming the Network BT s network today Today, BT s network (Figure 2) comprises some 16 discrete but related network BT will empower customers with control, choice and flexibility like never before and offer them communications from anywhere to any device. BT will make exciting new services available for customers faster than has been possible before. BT is reducing its costs it will make growing cash cost savings which are expected to amount to 1 billion per annum by 2008/9. platforms, each designed to support a service. This is a network that reflects numerous technology waves. As new technologies emerged, it was usually more straightforward to overlay network capability. It comprises tens of thousands of network elements, including switches, routers and concentrators. Maintaining this type of network, with the associated services,support and training it requires, is expensive and a significant source of BT s operating costs. BT s network of the future BT s 21CN program is transforming the many legacy networks into a simpler, but more powerful, multi-service network, which will be the platform for a full portfolio of new wave services, as well as continuing to support traditional services. BT s 21CN network is much simpler. There will be a radical reduction in the number of components, resulting in physically a much simpler, and therefore a more reliable, network. The 21CN network is multi-service. This means that a single network infrastructure will be able to support voice, data, Internet and video services. The new network will comprise very high-capacity routers connected together by an advanced optical network. BT will build, in the UK and throughout the markets it serves, an advanced broadband network based on intelligent systems, IP and multiprotocol label switching (MPLS). The shape 2

3 Expert s Forum Delivery BT s 21st century network Copper Fiber DSL PSTN KStream PDH Access PDH Access SDH Access SDH VC-12 PDH PSTN Leased Lines ATM SDH VC-4 IP BT is aiming high aiming to provide voice services over IP at the same or better than the high standards of quality and reliability people expect from its PSTN service today. And, BT believes that the quality of voice over IP will improve as wider-bandwidth devices better suited to reproducing voice frequencies are developed. 21CN - Concurrent Systems Transformation End- User ~5.5k ~2k Figure 2 ~1k or topology of the network will be fashioned by advances in fiber optic technology which leads to fewer switching nodes and, in general, longer links. The physical simplicity and the reduction in the number of operating facilities will have the added benefit of enhancing reliability. In essence, 21CN is a single platform (Figure 3) supporting multiple services rather than multiple platforms, each supporting single services based on IP technology in the core. In the traditional world, services voice, for example require their own discrete networks with discrete infrastructure, systems, management and services to support them. In an IP world, services are applications. For example, voice becomes one of many applications running on a common platform and the systems, services and management processes are shared. Multi-Service Access Copper Fiber and Copper Agg Box DSL ~300 21CN BT s current network ~100 21CN and quality ~15 In telecommunications, customer expectation of acceptable quality is practically absolute. In comparison, in the IT or IP world, there has, to date, been a less demanding expectation of what is an acceptable level of quality or reliability. BT fully realizes that 21CN needs to deliver communications services over an IP infrastructure at the same or better level of quality and reliability than telecoms customers have come to expect with PSTN. It is designing this quality and reliability in to the new network. Using IP technology in the network for BT s premium quality voice services is a gulf apart from the new budget voice-over-the- Internet services being launched almost daily by a wide range of providers. Converged Core Class 5 Call Server IP-MPLS-WDM WWW Simplifying the network platform alone is not enough. BT is also transforming the systems that manage both its network and business. BT s current network is managed by around 1500 different applications, each doing an important job in delivering the overall service to customers. This is another area of cost efficiency that is being addressed through 21CN. However, central to 21CN is improving the customer experience. One of the key objectives is to give the customer more direct control of their experience. This will be delivered by empowering customers to interact directly with the network via, for example, a simple browser interface, rather than always having to call BT to add, amend or change the scope of their service. Delivering this capability requires a new approach to the systems behind 21CN. In five years from now, it is believed that eight in every 10 customer interactions will be direct with the infrastructure, delivered without the need for service desk or manual intervention by BT. This will be good news for those who want to manage their communications services themselves. For others, BT will continue to provide the support they require. The Customer Experience End- User ~5.5k Figure 3 ~100 21CN BT s simplified network Content ISP For discussion purposes. No implementation assurances BT believes that 21CN will accelerate the speed with which it delivers new products and services to customers. This will be achieved by adopting product development principles refined in recent years in the IT industry in which applications draw on the underlying capabilities of the operating 3

4 Huawei Technologies system. Products can be developed more quickly by identifying and combining a series of common, reusable capabilities. BT has drawn up an initial set of 12 common capabilities (Figure 4) and more can be expected over the coming months and years. These are building blocks that can be combined in different ways to create new services, a little like chemical elements which combine to form different compounds. Reusing proven components in this way can save time, reduce costs and increase consistency for customers, as well as meaning that new services can be brought to customers faster than before. Examples of these capabilities are authentication the ability to identify a person or device based on a range of credentials such as a username, password or even biometric data such as fingerprints and eye retinas. Content repurposing means making content such as books, audio tapes or videos into digital content that can be used online and adapted to use with various end-user devices. Application driven QoS (quality of service) is the ability for the network to configure itself in real time according to the needs of the application the customer is using perhaps flexing band-width during the sending of a video for example. Steps to 21CN In June 2004, BT announced a five-year program to underpin the next generation of converged, multimedia communications services. Following a detailed technical and economic analysis of the options for 21CN deployment in 2004, 2005 is seeing the initial stages of implementation and live technical trials get underway, prior to investment and deployment decisions being taken. BT is moving towards the mass migration of PSTN traffic on to the 2005 new network from 2006 thereby enabling the gradual closure of the existing PSTN switches. By 2008, BT s aim is to have migrated more than 50 per cent of all PSTN traffic on to the new IP network. Ultimately, BT will retire its PSTN but no timescale for that has been set yet. The steps to 21CN (as illustrated in Figure 5) cover the growth of broadband availability, the transfer of traffic in stages to the multiservice IP network and the development of products based on the common capabilities. By 2009, most customers will have broadband dial-tone. This will give them control of their own services. They will be able to switch their line to broadband use themselves without requiring physical work at the exchange, whatever device they use to access the broadband network. This is an ambitious and exciting program with 21CN deployment expected to be substantially complete by the end of the decade. Existing network and systems investment is aligned to the 21CN program and contracts for key components of the converged multi-service IP network are expected to be announced in2005. Current Activity In this financial year to March 2005, BT has identified several closely interrelated work streams: Authentication Storage Directory and Profile Applications Environments Figure 4 Large-scale non PSTN service migration begins Presence and Location Customer Portal Application Driven QoS Digital Rights Management Secure Connections Home and Office Hub Content Repurposing Individual Customer Care 21CN common capability building blocks The transformation of BT s PSTN, described more fully below. A trial of access fiber to enable better understanding of the economics, the benefit and the investment required to put fiber into the access network, described more fully below. The implementation of a converged network that will support all types of services, where BT collapses its various networks into one converged, multiservice network and management system. The implementation of a new framework for the creation of services where common capabilities or building blocks are used to develop new products faster than ever before Mass PSTN migration begins 17 new product launches / enhancements based on reusable capabilities New operations and service management capablity in place 2009 Broadband dialtone available to most customers Mass PSTN migration reaches more than 50% of customers 2004 PSTN transformation trial Access fiber trial Converged network, Service creation Experience development centre Broadband available to 99.6% Strategic vendors announced Broadband growth on MSAN/combo cards First new service launches based on reusable capabilities For discussion purposes. No implementation assurances Figure 5 21CN common capability building blocks 4

5 Expert s Forum Delivery BT s 21st century network The creation of what BT calls an Experience Development Centre. This is where BT will put itself into the shoes of customers and satisfy itself that it is delivering as customers expect from the start. 21CN PSTN Trial As part of the 21CN strategy, BT is adopting IP as the common transport protocol at the service layer for the transportation of all products including voice. Prior to the large scale migration of voice and other PSTN-based services from 2006, BT is running a technology proving pilot (Figure 6), the first stage of which involved the seamless bypass of the core PSTN network between three major network nodes at Cambridge, Woolwich and Faraday in London. This has resulted in voice calls diverted to an IP/ MPLS network. Next, BT is installing multi-service access nodes (MSANs) at 18 exchanges in southeast London, Kent and East Anglia. The copper pairs from selected customer sites at those exchanges will be connected to MSANs effectively replacing the PSTN concentrator units for those customers. Their voice calls will be adapted into an IP packet flow in the MSAN, resulting in calls between selected customers being carried exclusively over IP. BT s 21CN program in a nutshell 21CN is designed to deliver a world class customer experience from end-to-end, from accessing and managing a range of services, to receiving the bill with those services delivered at the same or better quality than BT s customers receive today all enabled through innovation at BT. 21CN will drive a radical simplification of BT s operations, including delivering significantly lower costs and the capability to launch new services to market faster than possible today. It will empower the customer with control, choice and flexibility like never before. 21CN is a next-generation network infrastructure, but it is much more than that. It s about supporting the next generation of services and revenues for BT and BT s customers. 21CN is also about transforming BT s business and its cost base. BT needs to invest between 2 billion and 3 billion every year for the rest of this decade to deliver 21CN spend within the previously announced BT capital expenditure figures of about 3 billion per annum. Against this investment, 21CN will deliver 1 billion of cash savings to BT every year... and BT expect to achieve this level of cost reduction from the financial year 2008/9. BT will continue to maintain its legacy networks and services as it transitions. With the trial equipment at Woolwich and Cambridge commissioned, BT completed the network bypass in 2004 with hundreds of customers due to have service across this pilot network in Access Fiber Trial The 21CN fiber trial (Figure 7) is testing the technical and commercial issues involved in deploying fiber optic cable in the local access network. BT is providing access fiber to hundreds of businesses and greenfield residential premises. Going live in autumn 2004, this trial will provide telephone and broadband services over fiber for up to 750 homes and small business customers in Martlesham Heath, Milton Keynes and London s Docklands. At this stage BT does not envisage widespread deployment of fiber to residential 5

6 Huawei Technologies or small business premises in the near or medium term. While it is believed that the use of fiber can help deliver better operating costs, this must be balanced against the cost of installation and systems development. These trials will help to shape BT s thinking and help the company make strategic investment decisions in the future. 21CN is about deploying the best combination of technologies to give customers the services they want, at the optimum speed and price. No one technology will suit all requirements. Hence, in addition to evaluating if fiber could be utilized in BT s local loop, BT is also looking at how new wireless technologies such as WiMAX could best be utilized. This is not an either/or decision it is about how to deliver the best combination of next generation technologies in a way which is seamless to the customer. That s what 21CN is all about. 21CN BT s Approach 21CN is technically challenging but the human challenge is greater. It s about the way BT works with its people, the industry and its customers. The company is Next-generation voice services involving hundreds of customers live by end of January Major roll-out to all regions begins Broadband dialtone to most customers by Figure 6 PSTN Trial taking an inclusive and consultative approach to 21CN. A partnership approach BT is making every effort to ensure that interested parties are aware of the 21CN vision and the progress being made. During the design stage, BT has consulted widely with customers and with the world s leading telecoms and IT suppliers. BT is talking to customers established and new, to suppliers established and new, to investors, to consultants, to academics, and to the regulator and will continue to do so. BT will continue this partnership approach as it moves forward. This approach is allowing BT to choose the best possible technology platforms available worldwide. It has helped BT to minimize any implementation risk by selecting proven technology platforms for each element of the overall program, platforms that have been implemented successfully, and at scale, elsewhere in the world. The wholesale market BT recognizes that it is only by the industry working in the spirit of openness that the benefits of what 21CN can do will be maximized for UK plc. Through Consult21, BT is working with industry to promote a shared understanding of the 21CN vision and the progress being made, giving wholesale customers an opportunity to input and influence its development. Already discussions are underway on key 21CN themes such as access and interconnections, private circuits and data, broadband and future services like voice over IP and multimedia services. BT is always open to ideas and indeed will continue to listen to others as it plans, tests and implements this radical companywide program. Visit for BT Wholesale customer consultation progress including a calendar of events. Common standards BT champions the establishment of common, open standards that facilitate communication across networks, across devices and across boundaries to the benefit What? Trials of deep fiber in the access network to the cabinet and to the premises. Designed to test the investment, operational, technology and business case. When? First trialists fiber lines were installed and working in October Trials to run until September Where? Trials in Suffolk, Milton Keynes and Lodon. Figure 7 Access fiber trial of customers. BT believes that industry players who are investing billions of pounds in next-generation networks around the world should aim to make them interoperable and compatible. Regulatory environment Clearly, as a business in a heavily regulated industry, BT also needs to consider the regulatory environment into which it makes investments. The world we are moving towards will remain regulated, but the radically transformed nature of the industry will require a different regulatory frame of reference from that which has operated in telecommunications for over 20 years. BT believes that the general level of 6

7 Expert s Forum Delivery BT s 21st century network 21CN it s underway. In August, BT took delivery of a range of new technology to support the transformation of the network. Here we can see kit being hoisted into Woolwich exchange in London. However, this picture is symbolic of other activity. For example, also by this time equipment to underpin the voice migration pilot had also been delivered to BT s exchange at Cambridge and the network construction completed for the 21CN access fiber trial. BT Wholesale s Martin Healey and Steve Mitchell plan the PSTN to IP switch-over at BT s Cambridge network management centre. regulation in the UK today is excessive for today s competitive market. Relevant and appropriate regulation needs to be based on today and the future and not on history with fresh, innovative regulatory approaches introduced to benefit the customer, the industry and the economy. Regulators face a difficult challenge. What is required is a fair and consistent regulatory framework that recognizes and helps operators implement the necessary industry changes and facilitates the huge investment required as we move to the new converged world. The industry needs a regulatory regime that can keep pace with technology, ensure continuing investment and encourage innovation. BT is very pleased that, as a key element of its wide-ranging strategic review, Ofcom has recognized this and is considering it as it develops the shape of future regulation in the UK. BT is participating fully in that review. A Wise Investment BT believes that 21CN will significantly reduce operational costs, facilitate best-inclass costs for all its customers and itself and underpin revenue generation. Using stringent return-on-capital criteria and taking a pragmatic approach to any investment in the narrowband network, BT s 21CN program aims to deliver long-term structural cost reduction as the company progressively migrates onto a simpler, lowercost network architecture. BT s network transformation strategy will be developed and implemented from BT s previously announced CAPEX envelope of 3 billion per annum. From this year about two-thirds of the annual spend is directed to 21CN and other new and intermediate technologies, and this proportion is expected to increase. Against the investment, 21CN will deliver 1 billion of cash savings to BT every year and BT expects to achieve this level of cost reduction from the financial year 2008/9. Specifically, BT believes savings will come from: operating simpler, modern, reliable, hands-off networks with self-diagnostic and self-healing capabilities, which means that investment now should lead to significantly lower operational costs in the future; an increasing emphasis on commercially available operational and business systems solutions, which are set to improve efficiency by removing duplication and reducing complexity; taking every opportunity to iron out duplication of management systems and to recycle network components where improvements in customer experience and increased efficiency can result. However, the program is also positioning BT to offer a host of new services for customers. It aims to deliver future growth and new revenues through voice, Internet, mobility, multimedia and intelligent services. Summary To sum up the scope, scale and importance of 21CN in an analogy, consider transportation. Imagine a single, integrated transportation infrastructure that allows passengers to travel from anywhere to any destination regardless of whether they want to travel all or part of the journey by car, by train, on foot, by bus or aeroplane. And the trip will be faster and the experience considerably better and customers will have the power to make their own choices. BT s 21CN program is setting out to achieve this experience in communications and BT is doing it seamlessly so that there is minimal impact on the current services and operations that BT delivers to its customers today. It is an immense task. 21CN conceived in 2001 in its scale and breadth is possibly the biggest single initiative that BT has ever embarked on. It is a fundamental remaking of its business, not just the network. And BT expects to complete its 21CN transformation in a fraction of the timescale for digital migration in just five or six years from now. 21CN is the enabling infrastructure for growth for BT and its customers. BT believes it is the most ambitious and exciting business-transformation program underway anywhere in the world and it is designed to radically enhance the customer experience in the converged world. It represents a major investment by BT that will put its customers at the forefront of innovation in communications worldwide. And BT is delivering it now. 7

8 Huawei Technologies Matt Gorin, BT Wholesale modern apprentice, taking a closer look at the first MSAN installed as part of the 21CN voice trial at Bexleyheath exchange. Matt Beal BT Wholesale Matt Beal was appointed as BT Wholesale Director of 21CN Implementation and Strategy, in November Matt is responsible for implementing BT s 21CN vision and developing new standards for innovation, workflow and customer automation. Before joining BT, Matt was Chief Network Architect for WilTel Communications in Oklahoma. Joining in 2001, Matt was responsible for merging two disparate asynchronous transfer mode (ATM) networks as well as consolidating two IP networks into single media-optimized MPLS network. He implemented network lifecycle management processes to streamline operational activities. In this role, Matt created a solutions architecture effort that by mid-2001 had recovered 50 percent of the architecture group s costs with professional services revenue from customers. Matt joined WilTel from Nexbell Communications where he held the position of Chief Operating Officer. He implemented a 30-node voice-over-ip (VoIP) network, providing nationwide, local and long-distance access to wholesale customers. Matt also was responsible for securing financing from the venture community, leading to a merger with I-Link Communications where he became Vice President Marketing, creating a new product development process and rebranding the I-Link offering. Matt and his wife Laura a Ph.D. organic chemist are new residents in the UK and are keen to explore the sights, history and foods of the UK and Europe. 21CN Gathers Pace BT s 21CN journey continues to gather momentum. Here is a summary of the program s achievements since this article was first submitted. First customer calls carried on a dedicated IP link At the end of October 2004, BT diverted the first customer calls off the public switched telephone network (PSTN) on to a dedicated Internet protocol (IP) link. This was a historic occasion for BT the PSTN has served the company well for over a hundred years. Now, for the first time, it has public voice on a single IP network where voice calls are transmitted in data packets. A new IP link between the major network nodes at Cambridge and Woolwich in South East London, along with soft switches installed at these locations, enables telephone calls to bypass a major traffic route in BT s PSTN. This represents a key step towards the creation of BT s next-generation network. Call flows are now being gradually increased allowing BT to monitor and maximize this network s performance. First BT access fiber trialists connected BT has reached a milestone in its 21CN program with the first tranche of BT customers who are trialling fiber to the premises technology going live on the network. By the end of December 2004 around 100 BT people trialists were receiving services over access fiber connections. By March 2005 the plan is to provide telephone and broadband services over access fiber to about 750 customers in Martlesham Heath in Suffolk, Milton Keynes and London s Docklands. 21CN trials opened to industry BT Wholesale is extending participation in the 21CN technical trials to other operators. Over the next few months, BT Wholesale will be working through Consult21 to refine the scope and detailed parameters of opening the voice transformation trial to industry. BT Wholesale is currently developing proposals to test the delivery of an end-toend 21CN service from January Sometimes referred to as Pathfinder, this trial is being designed as a precursor to the mass migration of customers on to 21CN. Building on the experience of the current 21CN trials and the extension of the voice trial to industry (scheduled to start in summer 2005), Pathfinder will test the delivery of network operations, systems, processes and service management, including product and service migration to around customers. The first multi-service access node (MSAN) is commissioned In early December 2004, Bexleyheath telephone exchange in Kent was a hive of activity with engineers commissioning the first multi-service access node (MSAN) in the 21CN trial network. MSANs will be the access point into the 21CN network supporting voice, data and broadband. A further 17 MSANs are currently being installed at exchanges in south east London, Kent and East Anglia. Prior to the start of the mass customer migration, BT will be trialling the use of MSANs to carry voice and data services onto the 21CN trial platform, initially involving hundreds of BT people by the end of January In the summer 2005, BT will extend the 21CN nextgeneration voice trial participation to other operators. 8