1. Kingston Communications SMP obligations and their implications for “NTS calls originating in Hull” Huw Saunders Group Regulatory Affairs and Technology Development Director

2. The regulatory background - 1 “Old” EU framework came into force in 1998 Interconnect Directive allowed NRA to impose cost oriented “wholesale” interconnect prices on operators with SMP Kingston designated as having SMP in the “Hull” area

3. The regulatory background - 2 “New” EU framework came into force in 2003 Access and Interconnect Directive allows NRA to impose cost oriented “wholesale” interconnect prices on operators with SMP Kingston designated as having SMP in narrowband markets in the “Hull area”

4. The Kingston RIO/RONNA Reference Interconnect Offer in response to SMP obligations Prices published in KIPL/NNAPL based on Kingston costs Costs derived through application of Oftel approved DOCAS methodology Determination of 21/10/01

5. The issues - NTS DOCAS produces a different “C” for NTS formula For directly connected TNOs, this provides no problem - NTS Schedules in RIO/RONNA and prices in KIPL/NNAPL are based on this “C” Most traffic transits via BT - conflict with current SIA/CPL

6. The issues - PAC Kingston provides full PCO service in the “Hull area” Provides access from them to full range of “free to caller” services Oftel policy decision established that all PCO providers were entitled to PAC Again, directly connected TNOs present no problem - but transit SIA/CPL?

7. Options for implementation Kingston specific NTS prices in CPL, incorporating differentiated “C” and PAC retentions BT provide “transit only” product to TNOs who conclude separate originating contracts with Kingston ?