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Standard Contract Forum 20 February 2008 13.30 Customer Suite, BT Centre, London

. Standard Contract Forum 20 February 2008 13.30 Customer Suite, BT Centre, London. Standard Contract Forum 20 Feb 2008. AGENDA Introduction and Notes of Previous Meeting AIT Consult 21 Product Update 21 CN Contracting Review of New and Amended Schedules Any Other Business.

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Standard Contract Forum 20 February 2008 13.30 Customer Suite, BT Centre, London

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  1. . Standard Contract Forum 20 February 200813.30Customer Suite, BT Centre, London

  2. Standard Contract Forum 20 Feb 2008 • AGENDA • Introduction and Notes of Previous Meeting • AIT • Consult 21 • Product Update • 21 CN Contracting • Review of New and Amended Schedules • Any Other Business

  3. Revised Annex E (AIT) Summary of Revised Artificial Inflation of Traffic (AIT) Annex E to the BT Standard Interconnect Agreement (SIA) Presentation to the BT Standard Contract Forum Erica Cumming, Commercial Lawyer BTW 20 February 2008

  4. Revised Annex E (AIT) • What is AIT?: • AIT is “artificially inflated traffic” occurring on voice interconnect service. • Annex E of the BT Standard Interconnect Agreement (SIA) allows call monies to be withheld where call traffic is suspected of being generated artificially (incl. potentially fraudulently). • While the call traffic is being investigated Annex E permits the ONO to withhold money from the: • - terminating network operator (TNO); or • - (more commonly) transit operator (TO) - who then withholds it from the TNO. • BT is the TO in 70+% of AIT cases, but may also be the ONO or the TNO. • After investigation the parties decide whether the call traffic is AIT or not. If it is not then it is promptly paid to the TNO together with interest (under current and also proposed new provisions). If it is AIT it is retained permanently by the ONO and should be refunded to callers wherever possible. • 5

  5. Revised Annex E (AIT) • Need new AIT Annex E: • Ever since the 2002 General Contract Review there has been ongoing work on a re-evaluation of the concept of AIT. • Current definition of “AIT”: “A situation where the flow of Calls to any particular Revenue Share Service is as a result of any activity on or behalf of the party operating that Revenue Share Service disproportionate to the flow of Calls which would be expected from good faith commercial practice and usage of the network.” • New forms of telephone scams constantly emerging, e.g.: • Missed calls from 070 and mobile number ranges, including displaying fake caller line identification (CLI) for the purpose of tricking recipients to dial the missed number. • Micro short duration calls designed to falsely trigger Call payments • Tromboning or routing calls outside the UK to increase Call charges • These necessitate improved processes and a more relevant definition • 6

  6. Revised Annex E (AIT) • Revised with industry: • Revised Annex E was drafted in conjunction with industry (C&W, Virgin Media, Band-X, Vodafone, KCom, Thus and 3) who support need for new Annex E • Aims of new AIT Annex E: • Refresh the scope of AIT Annex E to better capture the fraudulent, misleading or unconscionable, types of call traffic and make the retention and investigations process simpler and clearer • greater clarity of the roles and responsibilities of the parties and increase onus on ONOs to provide better supporting information: • introduce tighter timeframes make the overall process more structured and expedient • develop standard forms • give clearer reasons and more detailed substantiations for retentions • allow BT as transit operator to retain independently in specific circumstances • provide a process where for transit the ONO and the TNO are in direct contact, however BT can only come out of the dispute process with the agreement of the TNO and the ONO. • Clarify treatment of ported and hosted numbers • Clarify dispute resolution options. • Introduce an end date if AIT Dispute is not progressed by the TNO • 7

  7. Revised Annex E (AIT) • New definition “AIT”: • Definition wider but 01 and 02 geographic calls excluded as call charges too low to attract AIT activity • Two limbs of definition: • 1st limb: Calls for benefit of a party connected to a telecommunication service as a result of activity by that party or on their behalf and • 2nd limb:Calling pattern disproportionate to pattern would expect from: - good faith usage; or - acceptable and reasonable commercial practice Not “good faith” / “acceptable and reasonable commercial practice” if: • customer is misled • breach PhonepayPlus Code (unless “minor” under PhonepayPlus Sanctions Guide) • activity intended to prevent billing system capturing necessary information • 8

  8. Revised Annex E (AIT) • AIT Retention & Investigation timeline: • day 11st day of the calendar month after the date of the call traffic • day 14 A1 Retention Notice issued to TNO, explains “reasonable suspicion” of AIT • day 26 AIT Call Data provided to TNO or else A1 Retention Notice withdrawn • day 34 TNO issues Rejection Notice if objects • day 49 Dispute Notice issued to TNO (if not then deemed Withdrawn Notice) • 5 days If Dispute Notice served then becomes AIT Dispute 5 days later & parties • later resolve using bilateral negotiation, ADR, mediation, expert determination or court – but up to parties to decide how to resolve. • After 10 months of an AIT Dispute being declared: • If the parties to an AIT Dispute have not:(a) agreed resolution in writing • (b) agreed to commence a form of binding dispute resolution; or • (c) initiated court proceedings- • then it is deemed to be AIT and monies may be retained. • This gives incentive to TNOs to investigate and resolve suspected cases of AIT whereas currently cases stay unresolved for many years • Flip side is that ONOs cannot misuse the Annex E process because would be a breach of their obligation to act in good faith

  9. Revised Annex E (AIT) • Initiating A1 Retention Notice: • Under the new Annex E provisions, in transit situations the A1 Retention Notice can be issued by: • ONO (as now) • or (in future additionally by): • BT (but only in exceptional cases where only BT is aware of the AIT because it has AIT Data which ONO does not have access to) • Information provided on A1 Retention Notice: • Reasons for holding a “reasonable suspicion” of AIT (with reference to the definition of AIT) • Estimated value of sums to be retained • Estimated total duration and/or number of relevant calls • Start and end dates when relevant calls were made • Full dialled telephone number(s) - unless exceptional circumstances, i.e. informal/formal regulatory alerts or investigations or calling patterns which suggest a party is attempting to disguise AIT activity across a block of numbers • 10

  10. Revised Annex E (AIT) • AIT Call Data: • Detailed written explanation of why the AIT Call Data indicates AIT • AIT Indicators: • Retained former ones and added new ones to reflect new types of AIT • More than RSS or PRS calls • AIT Disputes: • Current AIT Annex E provides for Arbitration, but problematic because AIT Disputes may involve three parties across two different SIA contracts with risk of two different Arbitration outcomes. Has not been popular or used • New AIT Annex E does not proscribe any particular form of dispute resolution – it is totally up to the relevant parties. e.g. revised Annex E has flexibility for ONO and TNO to go for mediation – quick, cheap and decisive and don’t need BT there • Standard of proof to permanently retain the AIT sums is a “strong and convincing suspicion” of AIT (whereas the initial retention only requires “reasonable suspicion”) • 11

  11. Revised Annex E (AIT) • Implementation: • Simultaneous adoption of new AIT Annex E for process to work. • Many CPs have been involved in drafting and support the new AIT Annex E, provided it applies to all CPs from same date. • Plan: • BT issue new AIT Annex E as part of the Reference Offer at end of February 2008 after briefing the whole industry on the new provisions, and issue a Supplementary Agreement to all CPs • Require signature to Supplemental Agreement by 1 April 2008. BT may refer to Ofcom as a dispute if any CPs do not sign in time and BT would look to Ofcom to deem that new AIT Annex E shall apply to all CPs • AIT Annex E will come into force when triggered by an industry-wide notification from BT • 12

  12. Revised Annex E (AIT) • QUESTIONS?

  13. Revised Annex E (AIT) • Walk through the Revised AIT Retention Process • Charles Walker, BTW Finance

  14. Revised Annex E (AIT) • Diagram 1 • ONO initiated non-transit retention (paragraph 5 Annex E) • Diagram 2 • ONO initiated transit retention (paragraph 6.2(a) Annex E) • Diagram 3 • TO initiated transit retention (paragraph 6.2(b) Annex E)

  15. Revised Annex E (AIT) • QUESTIONS?

  16. Standard Contract Forum Consult21 Update on 21CN 20th February 08

  17. 21CN Plan Status • BT is conducting a periodic review of the 21CN Plan, which has the benefit of reflecting on the experiences to date from Pathfinder and other testing activity. The review is focussing on three main areas: • Early realisation of benefits of the move to 21CN for CPs and their end users • Expansion of flexibility and choice for CPs of the 21CN plan • Improving the levels of certainty of delivery to the plan. • Whilst Broadband and Ethernet product deliveries are on track, the approach to Voice (and the new voice products) is the subject of ongoing discussion with CPs • WBC trials continue, to enable an end of April launch

  18. NGN CC / Interconnect Questions • When will NGN CC be needed to convey NGN traffic? • What volumes are needed at each Point of Service Interconnect (POSI) to make the service commercially viable? • What are the relevant thresholds - volume of minutes or number of end users? • Planning NGN CC connections under end user migration strategy? • Where is the NGN CC service required? • Is a national service required at launch (with inter-Metronode conveyance) or would a geographic roll-out better serve CP needs? • If there is no significant end user voice migration for a time: • How long before the commercially viable volumes are reached should CP service establishment inter-working tests be undertaken? • Should we work directly towards the implementation of Replacement Charging Mechanism (RCM) to avoid the complexity and cost of the Interim Charging Arrangements?

  19. Interconnect While the voice strategy is being determined, the Tranche approach to DLE interconnect route migration to VICs (virtual routes off the NGS switches) has been suspended. IN the meantime, route closures and growth are subject to “per occasion” bi-lateral discussions between BT and CPs. The Next Generation PSTN Interconnect (NGN Call Conveyance) product is due to launch in time for mass migration. BT and the potential triallist CPs are working on the testing programme (tests, location, timescales etc) to achieve this. The actual launch date is however subject to review, as the concept of Mass Migration is now affected by the elective approach to end user migration. The 1G Multi-Service Interconnect Links (MSIL) product, which is required to carry both broadband (WBC) and interconnect (NGN CC) services, has been launched.

  20. Broadband • The Wholesale Broadband Connect (WBC) product, delivering the faster broadband capability to end users on ADSL2+ access technology, is planned for launch at the end of April 2008, with the “Managed” version of this product, (WMBC) following immediately after. • WBC plan is to launch with 5% coverage (some 84 exchanges) and achieve 50% coverage by April 09. • BT brought forward CP involvement in WBC trialling, These Birmingham trials are now approaching the third phase of testing. • IPstream will stay on 20CN, as will Datastream. The withdrawal of these products will be subject to consultation.

  21. Pathfinder – Migration Pilot in South Wales The Bedlinog trial and end user feedback activity gleaned some very useful feedback. This trial ended on 14th December. The date for the full re-load of both Wick and Bedlinog onto 21CN will be determined subject to test performance and upgrade paths to ensure the customer experience is optimised The scope of Pathfinder is subject to review as a result of the proposed approach to end user voice migrations Phase 1: 75k end users Phase 2: subject to discussion within Consult21

  22. Consult21 Working Group Information

  23. Consult21 Working Group Information

  24. Consult21 Working Group Information Full details of all the working groups can be found at:- http://www.btwholesale.com/pages/static/Community/21_Century_Network_Community.html

  25. Standard Contract Forum 20 Feb 2008 Sean Hartley 20 February08

  26. Products Update • 0870 • 070 Pre Call Announcements • 03 Billing • 0844/0871 Internationally Originated.

  27. Standard Contract Forum 20 Feb 2008 • 21CN Contracting – successors to the SIA • Keith Mitchinson

  28. Standard Contract Forum 20 Feb 2008 • 21CN contracting – successors to the SIA • ETHERNET MSIL • Will replace ISI and CSI interconnects for NGN CC when that’s available • …supplemented by SVLANs on the NGN CC contract • ISH, IBH and APH versions notified 30 December; launched 30 January • Launched in format of “prototype SMP MSA” contract (Consult21 Contracts Group lead) with Ethernet MSIL Service Schedule (MSIL experts group lead) • Review ongoing of “BT prototype SMP MSA”, and discussions on further developing into a generic SMP MSA for WBC

  29. Standard Contract Forum 20 Feb 2008 • 21CN contracting – successors to the SIA • NGN CC • NGN CC experts group established, initially looking at • ◊ Planning and Operations • ◊ SVLAN draft schedule • ◊ Service Schedules prioritised by industry • Agreed to commence work though end-date unclear • Need for close liaison with Consult21 Contracts Group recognised • BT proposes that Consult21 Contracts Group considers contract format later – in light of SMP MSA developments, in good time for FOA2 notification/launch

  30. Standard Contract Forum 20 Feb 2008 Schedule Update Keith Mitchinson

  31. Standard Contract Forum 20 Feb 2008 SIA CONTRACT DOCUMENTATION DOCUMENTATION UPDATES: Emergency Service - Schedule 225 Carrier Pre-Selection - Schedule 143

  32. Standard Contract Forum 20 Feb 2008 • SIA CONTRACT DOCUMENTATION (Cont) • Monthly Billing Option • Annex D • Schedule 01 (ISI/IEC/IBC) • Schedule 130 (CSI) • - Schedule 131 (VIC)

  33. Standard Contract Forum 20 Feb 2008AOB • New Web Portal still at • www.btwholesale.com • BT para 28 address

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