Speak Up or Forever Dial Up

The UK’s BT , long criticized by ISPs for
alleged foot-dragging in provisioning ADSL to allow BTopenworld to outstrip competitors in signing up customers, has initiated a new
scheme intended to dramatically reduce the risk of upgrading exchanges for ADSL.

On July 1, BT Wholesale will launch a registration system that will give consumers and businesses the opportunity to log their
interest in ordering broadband service in their area through service providers. The service providers will then record the numbers
on a broadband registration database BT will maintain for the task.

BT said the registration database will record demand for every exchange in the country. The company said it will also publish
“thresholds” for the level of demand required to make the exchanges commercially viable. At the launch, BT will publish trigger
levels ranging from 200 to 500 user registrations for more than 300 of the 500 exchanges it has reviewed since April to establish
individual costs of ADSL deployment and operation.

The company said the remaining 200 or so exchanges that have been reviewed still need further work before a threshold is set. BT
will publish threshold levels for those exchanges and 400 additional exchanges in phases between July and September.

Incumbents in the U.S. have been reluctant to upgrade exchanges — many of which were first installed during the industrial age and
tend to be located far from target demographics — because the exchange must attract a certain number of subscribers before it
becomes profitable. BT, as the UK’s only incumbent, has had even less incentive than U.S. firms to take that gamble. But BT
Wholesale’s new scheme virtually eliminates risk by using its target audience to perform its market research.

“Businesses and consumers can register their interest with service providers who will record it on the broadband registration
database,” said Ben Verwaayen, chief executive officer of BT. “The demand and the target levels will be clearly visible to all and
will help individuals, communities, local authorities and service providers to have a direct impact on broadband rollout.”

BT said that when demand reaches the threshold for a particular exchange, Wholesale will inform service providers, which will then
have 42 days to convert registrations from the database into advance orders. When those confirmed orders meet the required level
(and other technical criteria are met) BT said the exchange will be included in its build program for ADSL deployment.

BT has already enabled 1,115 exchanges for ADSL, serving 66 percent of households in Britain. If all of the current 900 exchanges
under review are also enabled, BT will then serve more than 80 percent of Britain’s homes. In addition, the company said it is
investigating partnerships and alternative technologies — including wireless and satellite technologies — which will help it serve
areas outside the reach of its DSL with broadband services. The company said registrations from those areas will help it focus those

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