1. WBC Fibre to the Cabinet (FTTC) Overview Aug 2011 Author – Lee Martin 1 *Reflects current thinking: Subject to change

2. Legal and Confidentiality Statement This Presentation is supplied by BT for discussion purposes only and is confidential and should not be disclosed without British Telecommunications plc’s (BT’s) through the BT Wholesale FTTC Product line, permission (Please treat it accordingly and do not forward, republish or permit unauthorised access. Details within it may be subject to change for technical, commercial or operational reasons. 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: broadband products; implementation of BT’s 21st Century Network. Although BT strongly 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 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 conditions in the markets served by BT; future regulatory actions and conditions in BT’s operating areas, including competition from others; the anticipated benefits and advantages of new technologies, products and services, including broadband and other new wave initiatives, not being realised; and general financial market conditions affecting BT’s performance. BT undertakes no obligation to update any forward-looking statements whether as a result of new information, future events or otherwise. The information contained in this Presentation represents our current thinking about future product developments at the time of publication. Any developments and time scales contained within this Presentation are estimates for information purposes only and do not constitute any contractual or other obligation. In relation to any products/services referred to in this Presentation which are currently under development and/or trial, BT gives no undertaking or other commitment that the product/service will be made commercially available. BT reserves the right to make changes to the information in this Presentation at any time without further notice. In relation to product trials referred to in this Presentation, future availability and participation in any such trials with future BT products/ services are not guaranteed. © British Telecommunications plc, 2011. Any third party right are hereby acknowledged. All rights reserved. Registered office: 81 Newgate Street London EC1A 7AJ Registered in England no: 1800000 2

3. BT’s Investment in fibre access £2.5bn investment to roll-out fibre to two-thirds of UK premises by 2015* –No other company in the world is investing as much in fibre without either public sector support or a regulatory regime that allows the company to make far greater returns. Deploying at scale and pace –Over the course of the programme we’ll be installing c.30,000 cabinets, enabling over 1,000 exchanges, laying over 50,000km of fibre, supported by c.32,000 engineers –Building the equivalent of the fibre network in Singapore every quarter –More than twice the pace of Deutsche Telecom, AT&T, Verizon & Belgacom & more than three times the pace of peers in Japan and Korea –50 CPs currently selling the service, with customer take up accelerating –Training our engineers is a key priority. We’ve doubled the number of apprentices and last year trained nearly 1,500 additional engineers to do managed fibre installs. –today we’re making live approximately ~250 cabinets each week with over 5 million premises passed (Aug ‘11) –Likely that this time next year >6,500 households a week will be signing up 3 *Reflects current thinking: Subject to change

4. Fibre broadband case studies “I used to spend a lot of time just drumming my fingers. With FTTC, the queue of files just evaporates. I reckon I’m releasing 20 per cent more time every day for productive work. We’re convinced it’s second to none within the UK.” Sam Mably, Bluequest Media Marketing & design agency, North London Zen Internet customer, trialling up to 40Mbit/s service “Our first FTTP* trialist is getting a massive 90+Mbit/s download speed as well as 15Mbit/s upload. Certain limitations on copper such as the speed decreasing the further you are from the exchange are no longer an issue.” Dave Tomlinson, Plusnet About Herbie Hopkins, Milton Keynes, the first end user trialling up to 100Mbit/s fibre service Bluequest media enjoying faster broadband *product under development and trial 4 *Reflects current thinking: Subject to change

5. © British Telecommunications plc Wholesale Broadband Connect (WBC) Product Portfolio 5

6. © British Telecommunications plc 6 ‘Mixed economy’:  Fibre & copper options  Customer choice & flexibility Managed service:  Openreach provides access in the ‘last mile’  BT Wholesale provides a range of managed broadband services As much or as little as CPs want:  Component & managed service options  From BT Plusnet Partner to complete outsourcing Ease of use:  Standardised systems & processes  Streamlined service delivery  Common backhaul option… Enhancements, for example:  Real-time QoS, business services… Working in ‘partnership’ with others  To accelerate high-speed broadband rollout WHOLESALE BROADBAND CONNECT Offering a flexible, versatile rich portfolio *Reflects current thinking: Subject to change

7. Next Generation Broadband Mixed Economy * Product under development and trial * 7

8. * 8 Wholesale Broadband Connect (WBC) EoI Exchange Level Street Level GEA POH Node Core Node ADSL2+ ADSL1 (~1000) WBMC MSIL Aggregation Point (x 20) 20C BRAS 21C BRAS Backhaul CP Datacenter FTTC VDSL2 FTTC VDSL2 L2S DSLAM MSAN FTTP/ GPON FTTP/ GPON WBC MSIL *Reflects current thinking: Subject to change

9. WBC FTTC Product Up to 40Mb downstream & 2 & 10Mb upstream Home installation required Supports line rates from 5Mb to 40Mb SVLANS for Fibre Part of the WBC product family Latest Availability can be accessed via: http://www.btwholesale.com/pages/static/Community/Broadband_Community/21CN_Broadband_Availability.html http://www.btwholesale.com/pages/static/Community/Broadband_Community/21CN_Broadband_Availability.html 9 *Reflects current thinking: Subject to change

10. Access Portfolio PREMIUM CARE * 10 *Reflects current thinking: Subject to change

11. 11 Flexibility, Choice & Differentiation 16 MBPS (ELEVATED) 12 MBPS (STANDARD) 16 MBPS (ELEVATED) PREMIUM CARE *Reflects current thinking: Subject to change

12. 12 WBC FTTC

13. 13 WBC FTTC Rates & Throughput Matrix The actual rates that can be supported on any individual line will be influenced by two main factors. Either of these two factors may result in the End User experiencing a drop in the speed from what was originally achieved. 1.The distance of the copper connection from the End User’s premises to the Street Cabinet 2.The number of End Users signed-up and using the common cable which will determine cross-talk noise impact. *Reflects current thinking: Subject to change

14. 14 WBC FTTC Fault Threshold Rates (FTR) The FTR is the rate below which line rate (synchronisation faults) can be reported is set for both downstream and upstream rates (where applicable) when the WBC FTTC service is provided. The DLM profiles for WBC FTTC are controlled by Openreach and operate as a closed box (i.e. No manual configuration is permitted). The banded profiles currently offered by Openreach are as follows; Standard (the default setting): Aims to keep the line working with only a few errored seconds and retrains each day Stable: Offers a more assured level of stability, by providing increased error protection and allowing the line to work at a lower speed – a trade off against potential higher latency Speed: Allows for a higher line rate, by sacrificing stability. WBC FTTC Dynamic line Management (DLM) *Reflects current thinking: Subject to change

15. 15 Key CP Pre-order Responsibilities Before placing a WBC FTTC order the CP must: Inform the End User (EU) the details of connection. Ensure the EU is within the WBC FTTC Service availability area. Check that no incompatible services exist on the EU’s PSTN line. Check there is a valid contract for the use of a BT PSTN direct exchange line forming part of the BT Network over which the WBC service will be provided. Agree a proposed connection date with the End User (which is no earlier than the minimum standard lead-time). Advise the End User that the service is not universally available within the WBC FTTC Service availability area due to the physical characteristics of the EU’s telephone line. Before installing the WBC FTTC service, the CP must ensure the EU is aware; The VDSL modem will need to be directly connected to the SSFP on the main socket. Connection of the Service may cause fax machines and modems used on the PSTN line to operate at a reduced speed. Connection may affect security or burglar alarm systems that use the PSTN service. Sufficient mains power sockets must be available for any other mains powered equipment that may be associated with your service. That a BT Openreach engineer will visit their premises to “install” the service. *Reflects current thinking: Subject to change

16. 16 Installation of WBC FTTC During the installation of the WBC FTTC service, the Openreach engineer will install the following: Service Specific Front Plate (SSFP) The SSFP splits the delivery of telephony and DSL signals at the NTE5, delivering each service to a separate port on the socket to remove interference. Note: this is the Openreach physical network demarcation point within the EU’s premises 1.Active NTE (VDSL2 Modem) A VDSL2 modem will be supplied and connected to the data port of the service specific front plate. This allows BT to monitor and test the service provided. Note: ADSL filters are not required in the EU’s premises for WBC FTTC as the service is provided directly to the NTE5 (and data extension kit if provided), and not through to the telephony extensions. 2.Power Supply (for Active NTE) A single, low voltage power interface will be provided for use with the standard domestic UK supplied 240V (ac) and conform to the relevant standards. The power consumption is <9 W. Note: It is the CP ‟ s responsibility to make sure that there are enough mains socket outlets to provide a power supply for equipment, which may form part of your service at the EU’s premises. 3.Data Extension Kit (Home Wiring Solution) If the active NTE is to be sited more than approximately 1.5 metres from the NTE5, a data extension kit will be required (up to an additional maximum of 30m). Note: The data extension kit is a chargeable addition; CP ‟ s are advised to determine whether this kit is required for their End Users in advance of an order being placed. *Reflects current thinking: Subject to change

17. 17 The active Ethernet EU port on the Active NTE will support: 10/100Base-Tx with RJ-45 connectivity Auto-negotiation and MDI/MDIX auto-sensing. Data transfer at wire-speed for all packet sizes. Built-in layer-2 switch FTTC Installation Equipment (Illustration) *Reflects current thinking: Subject to change

18. 18 WBC FTTC Maintenance Classes Maintenance Class Operating HrsFix TimeEngineering visits Class 524 / 7 including UK Public and Bank holidays 40hrs8am – 6pm Monday to Saturday Excludes Regional Public and Bank Holidays Class 424 / 7 including UK Public and Bank holidays Response < 3hrs Fix < 20hrs 8am – 6pm Monday to Saturday Includes Regional Public and Bank Holidays) Out of hours where unrestricted access is available Class 1424 / 7 including UK Public and Bank holidays 7hrs8am – 6pm Monday to Saturday Includes Regional Public and Bank Holidays) Out of hours where unrestricted access is available Considerations Maintenance Category 14 SLAs will not be applicable in the Highlands and Islands of Scotland. You can report End User faults via the EcoPlus Portal or B2B All End Users must report any faults to you in the first instance. End Users should continue to report any PSTN related faults direct to their PSTN Service Provider *Reflects current thinking: Subject to change

19. 19 WBC FTTC Customer Service Plan The purpose of the Customer Service Plan (CSP) is to help you and your customer succeed with FTTC. The document provides a guide to BT Wholesale’s WBC FTTC End User Access order and fault management processes and contains useful contact information for Service and Support Teams to enhance your experience. The WBC FTTC Customer Service Plan can be found on the BT Wholesale Inspire site by following the link below; http://www.btwholesale-inspire.com/wp-content/plugins/download- monitor/download.php?id=5602 *Reflects current thinking: Subject to change

20. 20 Market

21. 21 PROPORTION OF BUNDLES PURCHASED (%) The Demand for Access Speed *Reflects current thinking: Subject to change

22. 22 A FASTER & RICHER EXPERIENCE  Network backup - much faster uploads and downloads  HD TV content and gaming - improving the customer experience  VoIP - many telephone lines via one connection  HD Video conferencing - professional quality without the need for expensive equipment or networks  HD security - video surveillance without the need for expensive set-up costs  Cloud services - network-based computing, enabling session mobility with zero-configuration  Desktop sharing – ‘see what I see’ experiences  Content opportunities - innovative & exciting …with the ability to run multiple applications simultaneously *Reflects current thinking: Subject to change

23. 23 Regional Opportunities

24. 24 Regional partnership bids - Cornwall & Isles of Scilly super-fast broadband programme Partnerships accelerate higher speed broadband rollout - this is one of the:  UK’S MOST AMBITIOUS DEPLOYMENTS  MOST BOLD RURAL DEPLOYMENTS GLOBALLY £132m* programme over 3-4 years:  £78.5m BT; £53.5m EU Announced 30 September 2010:  To global media attention  First end users about to be connected Key objectives:  For 80-90 per cent of Cornish businesses to have access to fibre broadband by 2014  Tens of thousands local businesses to benefit, creating 4k & protecting 2k jobs  Half local businesses to receive 100Mbit/s fibre broadband Delivered by Openreach, BT Wholesale & Cornwall Development Company Competition ready infrastructure  End user services offered by any ISP Substantial independent marketing programme The exact amount is dependent on demand for fibre from local businesses and could be lower than £132 million. The next generation broadband project is part financed by the European Union with up to £53.5 million from the European Regional Development Fund Convergence Programme, through the South West Regional Development Agency. *

25. 25 Reaching rural communities within our deployment plans Rural town on the outskirts of Cardiff 2470 homes and 335 businesses Broadband speeds of 6.5 Mbps and below As part of the commercial rollout BT is deploying fibre to 8 cabinets Enabling 1989 premises Rural town on the outskirts of Cardiff 2470 homes and 335 businesses Broadband speeds of 6.5 Mbps and below As part of the commercial rollout BT is deploying fibre to 8 cabinets Enabling 1989 premises Taffs Wells, Wales Rural town on the outskirts of Halifax 4500 homes and 435 businesses Broadband speeds of 4 Mbps and below As part of the commercial rollout BT is deploying fibre to 13 cabinets Enabling 3927 premises Rural town on the outskirts of Halifax 4500 homes and 435 businesses Broadband speeds of 4 Mbps and below As part of the commercial rollout BT is deploying fibre to 13 cabinets Enabling 3927 premises Calder Valley *Reflects current thinking: Subject to change

26. 26 Public Private Partnership - realising the shared vision to reach the ‘final third’ BT has pledged to invest £30m in the government’s Next Generation Broadband Project FTTC technology to a majority of businesses with other fixed line solutions being used where appropriate Will provide more than 1,000 cabinets across 166 exchanges Wholesale level solution to ensure all Service Providers can access services at the same T&Cs and cost. Increased competition will benefit end users White label marketing campaign delivered prior to the enablement of an area to generate awareness of next generation broadband BT has pledged to invest £30m in the government’s Next Generation Broadband Project FTTC technology to a majority of businesses with other fixed line solutions being used where appropriate Will provide more than 1,000 cabinets across 166 exchanges Wholesale level solution to ensure all Service Providers can access services at the same T&Cs and cost. Increased competition will benefit end users White label marketing campaign delivered prior to the enablement of an area to generate awareness of next generation broadband DETI objective: “increase the availability of next generation broadband speeds to 85% of businesses by 2011.” Northern Ireland Most ambitious rural broadband project in the world EU contribution of £53.5m is unlocking a BT investment of £78.5m. In addition to the £2.5bn we’ve already committed to the roll-out of fibre 25,000 businesses and 263,000 premises covered SFBB access to up to 90 per cent of local businesses and homes by 2014. An array of service providers offering competition and innovation A mixed economy infrastructure comprising FTTP*, FTTC, ADSL2+, wireless and satellite broadband Everyone to get improved speeds Most ambitious rural broadband project in the world EU contribution of £53.5m is unlocking a BT investment of £78.5m. In addition to the £2.5bn we’ve already committed to the roll-out of fibre 25,000 businesses and 263,000 premises covered SFBB access to up to 90 per cent of local businesses and homes by 2014. An array of service providers offering competition and innovation A mixed economy infrastructure comprising FTTP*, FTTC, ADSL2+, wireless and satellite broadband Everyone to get improved speeds Cornwall *under development and trial

27. 27 The Future

28. 28 BUSINESS BROADBAND’S COMING OF AGE We’re helping our customers’ business customers get the most out of broadband by: Increasing WBC copper & fibre footprints On-going Annex M – a WBC copper upstream booster service 5 August 2010 Offering a throughput guarantee of a minimum of 2Mbit/s downstream on the WBC Elevated service 2 September 2010 Improving business class maintenance options 16 September 2010 Increasing throughput April 2010 & 30 September 2010 A “custom” Option for Dynamic Line Management 1 November 2010 And introducing…… Real-Time QoS & WBC Fibre to the Premise (FTTP) In trial now Next generation broadband can be truly tailored to meet business needs