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Optical/IP

BT Stares Down 21CN 'Complexity'

SAN JOSE, Calif. -- Spring VON -- BT Group plc (NYSE: BT; London: BTA) is already feeling deadline pressure from its ambitious plan to go all-IP and unplug from the PSTN in 2011.

BT's Silicon Valley-based VP of technology and innovation, Jean-Marc Frangos, who spoke here yesterday, says his company is already facing a mountain of technical complexity on the way to completing 21CN.

"The technical challenge is immense; we have eight strategic suppliers working toward a common goal," Frangos said, adding that orchestrating the roles and interaction of all those vendors is a tall order in itself.

Then there's the technology itself. "Often we are putting versions of the software into the network that are future releases and haven’t been tested."

Frangos said the only way to make the 21CN initiative pay off is by shutting down the operator's old TDM/PSTN networks and moving all customers over to the all-IP platform. "You can really get the savings out of these systems if you make a bold move." (See BT Flogs Its NGN Smarts.)

BT has committed to spending "$18- to $19-billion" over ten years, Frangos said. "When we get it in place -- when we get to 'cruising speed' as I call it -- we will be saving £1 billion, or $2 billion per annum."

Frangos also pointed out that BT is building an IP Multimedia Subsystem (IMS)-based network in which new services can be built quickly with "reusable assets and APIs."

"Our product managers used to have to make new services from scratch or go out to the vendor community every time for things like authentication and DRM. We are giving them a set of building blocks that can be used over and over." This aspect of the network, BT believes, will create big-time cost savings in the future.

BT began moving customers from the PSTN to the 21CN network only last November, starting a challenging five-year plan to migrate 20 million lines to the single all-IP infrastructure it is rolling out across the U.K.

Frangos says less than 20 percent of BT voice calls travel over the PSTN today. He hopes that number will trend down to zero in the next four years. (See BT Switches on 21CN and BT: 21CN Slips, IPTV Nears.)

Several panelists and audience members here brought up Deutsche Telekom AG (NYSE: DT)'s recent decision to unplug its T-One dualmode phone service. During the Q&A, the moderator asked Frangos if BT might do the same thing if short-term profits flag during the move over to 21CN. (See DT Cancels FMC Service.)

Frangos replied that BT might alter its course slightly, but would never turn back. "We have multiple models being used in the 21CN network, and of course there are a number of performance metrics that have to be hit, but none of those models are about stopping completely and returning to the TDM world." (See BT Rethinks 21CN Core Strategy.)

Heavy Reading analyst Patrick Donegan says there's no comparison between BT's 21CN and Deutsche Telekom's T-One. He says the main reason for T-One's failure was the poor quality of the Foxconn Electronics Inc. handsets that were used for the service. (See DT Plans Strategy Revamp and DT Outlines Strategy.)

Donegan says he has seen no indication that BT would slow down or reverse its move toward the all-IP 21CN platform.

— Mark Sullivan, Reporter, Light Reading

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