2014

BT Announces Network Transformation Timetable * Mass migration of customers from PSTN to IP based network to begin in

2006

* Majority of customers' PSTN services on IP network by 2008

* Trials of voice services on IP network and fibre to the premises

announced

* Increase in customer choice, control and service flexibility



    NEW YORK, June 9 /PRNewswire-FirstCall/ -- BT today set out the timetable
 for the transformation of its UK networks.  It announced a five year programme
 to underpin the next generation of converged, multimedia communications
 services.  Mass migration of customers onto the new network will begin in 2006
 with the majority due to be completed in 2008.
     BT's 21st century network (21CN) programme will create the enabling
 infrastructure for the growth of BT and the UK telecommunications industry.
 It is set to completely transform BT's networks, delivering increased customer
 choice and control.
     BT Wholesale chief executive Paul Reynolds said: "The 21CN programme will
 deliver our vision of a converged, multimedia world where our customers can
 access any communications service from any device, anywhere - and at broadband
 speed.
     "21CN will drive a radical simplification of BT's operations including
 significantly lower costs and the capability to launch new services to market
 faster than we can today.  It will empower all our customers, giving them
 control, choice and flexibility like never before."
     The major elements of BT Group's overall strategy including ICT, mobility,
 broadband, netcentricity and portfolio transformation are underpinned by the
 21CN initiative.
     Over the next five years 21CN will transform BT's business and its cost
 base, removing duplication across the current multiple service specific
 networks and creating a single multi-service network.  Total capital spend on
 the 21CN transformation will be within the previously announced BT capital
 expenditure envelope of 3 billion pounds Sterling per annum. From this year
 about two thirds of the annual spend is directed to 21CN and other new and
 intermediate technologies and this proportion is expected to increase.  That
 investment in future infrastructure will enable BT to deliver growing cash
 savings which are expected to amount to 1 billion pounds per annum by 2008/9.
     An early deliverable of this transformation is the first phase of the
 migration of services from the existing UK public switched telephone network
 (PSTN) to a multi-service internet protocol (IP) based network which will
 carry both voice and data services.*  As a precursor to large scale migration
 of voice and other PSTN based services from 2006, the first stage will involve
 the bypass of the core PSTN network link between two major network nodes at
 Cambridge and Woolwich.  An extension is planned later to Faraday exchange in
 London.
     An initial 1,000 customers served by local exchanges connected to
 Cambridge and Woolwich will trial end to end voice and data services over the
 core IP network link.
     Paul Reynolds said: "Today the 21CN vision starts to become reality.  This
 is among the most important and ambitious infrastructure transformation
 programmes in communications anywhere in the world and will put Britain at the
 forefront of communications innovation.
     "But 21CN is more than a next generation network.  It's about providing
 and supporting the next generation of services for all our customers; it's
 about supporting and generating revenues and profits for shareholders, and
 it's about supporting and delivering for the communications industry and the
 economy as a whole."
     In addition to making broadband available from exchanges serving 99.6 per
 cent of people by summer 2005, BT is aiming to have broadband dialtone
 available to most of its customers in the UK in five years time.  Customers
 will be in control of their own services and will immediately be able to
 switch the line to broadband use themselves without requiring physical work at
 the exchange, whatever device they use to access the broadband network.
     BT also today announced trials to test the technical and commercial issues
 associated with the possible deployment of fibre optic cable in the UK local
 access network.  These limited trials are looking particularly at the
 economics associated with providing services to new build and greenfield site
 developments.*
     BT is today formally launching the procurement process to select long term
 suppliers, which may not necessarily be those involved in the trials and early
 implementation stages.  Contracts for the main rollout phases will be awarded
 following a formal competitive tendering process which will be concluded by
 the end of 2004.
 
     Note to editors:
     * For details of the trial migration of voice services onto an IP based
 network and the fibre to the premises trial see BT news release NR0445 issued
 today June 9, 2004.
     Photographs of Paul Reynolds, BT Wholesale chief executive, and 21st
 Century Networks related images are available via BT's picture library hosted
 by Vismedia at http://www.vismedia.co.uk
     A live webcast of BT's press conference will be available at 10.30am
 British Summer Time June 9, 2004, at http://www.btplc.com/presentation.
 
  Inquiries about this news release should be made to the BT Group Newsroom on
 its 24-hour number: 020 7356 5369. From outside the UK dial + 44 20 7356 5369.
               All news releases can be accessed at our web site:
                          http://www.bt.com/newscentre
 
                  U.S. Contact:  Eileen Connolly, 908-410-1419
 
     Forward-looking statements - caution advised
     Certain statements in this press release 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: transformation of BT's networks and cost base; benefits to
 customers of the 21CN programme; anticipated capital spend on 21CN
 transformation and expected cash savings; timescales for delivery of 21CN; and
 delivery of instantly available broadband.
     Although BT 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 materially 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 and financial markets conditions in the
 markets served by BT; future regulatory actions and conditions in BT's
 operating areas; technological innovations; developments in the convergence of
 technologies; and the anticipated benefits and advantages of new technologies,
 products and services, including broadband, not being realised.  BT undertakes
 no obligation to update any forward-looking statements, whether as a result of
 new information, future events or otherwise.
 
     About BT
     BT Group plc is the listed holding company for an integrated group of
 businesses providing voice and data services in the UK and overseas,
 particularly in Europe, but also in the Americas and the Asia Pacific region.
 British Telecommunications plc, a wholly-owned subsidiary of BT Group plc,
 holds virtually all businesses and assets of the BT group.
     BT is one of Europe's leading providers of telecommunications services.
 Its principal activities include local, national and international
 telecommunications services, higher-value broadband and internet products and
 services, and IT solutions.  In the UK, BT serves over 20 million business and
 residential customers with more than 29 million exchange lines, as well as
 providing network services to other licensed operators.
     BT consists principally of three lines of business: BT Retail, serving
 businesses and residential customers and including BT Openworld, one of the
 UK's leading ISPs.
     BT Wholesale, providing network services and solutions within the UK,
 including ADSL, conveyance, transit, bulk delivery of private circuits, frame
 relay and ISDN connections.
     BT Global Services, BT's managed services and solutions provider, serving
 multi-site organisations worldwide.  Its core target market is the top 10,000
 global multi-site organisations with European operations.
     There are a number of other businesses within the BT group, including BT
 Exact, an internationally renowned centre of excellence in IT and networking
 technologies. It is also BT's technology and research and development
 business.
     In the year ended 31 March 2004, BT's turnover was 18,519 million pounds
 with profit before goodwill amortisation, exceptional items and taxation of
 2,016 million pounds.
 
     For more information, visit http://www.bt.com
 
 

SOURCE BT Group plc

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