Minutes Table Derivation

1
Minutes Table Derivation Application of
Overflow

• The focus of the presentation is on principles
• How it works
• how we operate the calculation
• These principles have been derived using feedback
  received during the Minutes Table Consultation

2
Context

• Ofcom determination
• NCC Technology Neutral Charging
• BT intends to move to 21CN
• DLE Closure
• Maintaining LES Rate
• BT solution is Virtual DLE interconnect

3
VIC is Designed to

• Enable LES rate via NGS
• Retain current competitive relativities
• Offer no material advantage / disadvantage
• Enable new access to LES rate subject to the same
  conditions as before
• Protect existing CP investments
• Ensure CPs pay same amount for circuits and
  distance to carry the same minutes
• Ensure CPs continue to pay for local-tandem
  conveyance when insufficient local capacity
  procured.

4
VIC Challenges

• Technically impossible to route BT originating
  calls to separate physical circuits for each
  former DLE. So
• Both way Ingress traffic from different DLEs
  will be mixed on a single route.
• Individual DLEs traffic cant be constrained by
  peak minutes when its combined on a single route.
• So we need to control total minutes per DLE in
  order to approximate the economics of
  interconnect to individual DLEs

5
Commercial Logic for VIC

• CP chooses DLEs for LES rate (as today)
• CP procures DLE capacity in E1 units (as today)
• BT rates all calls on VIC routes at LES
• Existing conveyance bill reconciliation processes
  apply using EBC files
• BT compares total LES minutes to the number of
  virtual E1s procured for each VIC route.
• Excess charge applies to minutes in excess of the
  minutes capacity of the VIC route
• Minutes Capacity of VIC route set from minutes
  table (separate values for day / evening /
  weekend)
• Excess p.p.m. ST LES (for DLE VIC)

6
Some people get more minutes than others from an
E1

• Currently
• minutes constrained by peak capacity with
  physical circuits
• Flat traffic gives high minutes per peak erlang
• Peaky traffic give low minutes per peak erlang

7
Minutes Table Objective

• Same Capacity Same Traffic Profile Same
  Minutes
• VIC uses each CPs individual traffic profile to
  identify minutes per peak hour erlang
• Ratio of minutes to peak hour erlangs is a
  characteristic of the traffic stream

Minutes per erlang per day reflects CP specific
traffic profile

Route size (E1 Capacity) scaled to TC4 reflects
the relative efficiencies of larger routes
8
Issue 81

• Blue scenario traffic fits in TC4
• 15 growth gives purple mins _at_ LES red at ST

• When minutes table derived, CPs who overflow
  while still meeting obligation to fully provide
  will have
• A flatter traffic profile therefore more
  minutes in the minutes table
• If overall traffic increases then more circuits
  will be required
• Overflowing routes get more capacity and stop
  overflowing
• Non overflow routes keep same capacity and start
  overflowing.
• So CP not disadvantaged overall
• If overall traffic profiles change a review can
  be requested
• CPs would request if profile flattened, BT would
  request if profile went peaky

9
There are benefits of this approach

• Monthly tables smooth daily and weekly variations
• Traffic spikes will generate less ST rate calls

10
Excess Charge

• VIC calls are rated at LES rate
• Excess bill for overflow based on total minutes
• Excess minutes charged at difference between ST
  LES rate
• ST LES LT (defined by NCC)
• Difference is constant
• See Carrier Price List

11
Application of minutes table

• VIC route defined by Target DLE, NGS, (and Route
  ID if segregated route option)
• May optionally apply to specific direction /
  traffic types (e.g. CPS, NTS)
• Separate calculations for day / evening / weekend
• Minutes Table applies to all minutes assigned to
  the VIC route
• BT billed LES minutes as per standard conveyance
  bill
• CP billed NTS minutes - where CP bills NTS rate
  minus LES
• Minutes are based on routing plan not actual exit
  POC (for BT originated calls)
• Number of VIC E1s purchased taken from Circuit
  billing
• Minutes allowance looked up from mins table and
  pro-rated to number of weekdays / weekend days
  per month
• Incremental rate is constant so it doesnt matter
  which minutes are considered as overflowing E.g
  for daytime
• total minutes 120,000
• Allowance 106,029
• Excess 13,971
• Rate 0.1071 (from 1/4/2006)
• Excess charge 14.96 (ex VAT)

12
Application of Minutes Table(conceptual model
subject to solution design)
13
Overflow CP Originated Calls
NGS

• Segregated Routing Option
• Calls sent via DLE route segment (identified by
  Route ID)
• Rated at LES subject to minutes table excess
• Calls sent via Tandem route segment (identified
  by Route ID)
• Rated at ST excluded from minutes table excess
• Calls sent via alternative NGS
• Rated according to options at alternative NGS
• Consolidated Routing Option
• Calls sent via consolidated route segment
  (identified by NGS NNI)
• Rated at LES subject to minutes table excess
• Calls sent via alternative NGS
• Rated according to options at alternative NGS
• Overflow Minutes either ST rated or virtual
  excess but never both

14
Overflow BT Originated Calls
NGS

• Segregated Routing Option
• Calls sent via DLE route segment (identified by
  Route ID in routing plan)
• Rated at LES subject to minutes table excess
• Calls physically overflowing to Tandem route
  segment or alternate NGS
• Rated at LES in line with routing plan
• Included in VIC minutes table
• Consolidated Routing Option
• Calls sent via consolidated route segment
  (identified NGS/Route ID in routing plan)
• Rated at LES subject to minutes table excess
• Calls physically overflowing via alternative NGS
• Rated at LES in line with routing plan
• Included in VIC minutes table
• Routing Plan determines rate and the VIC so
  overflow never double charged

15
Minutes Table Derivation

• Too complicated to have table by route
• Too complicated to have tables by DLE
• Must not discriminate unduly between CPs
• No material disadvantage or advantage compared
  with current position
• Analysis indicates cannot have single table for
  all CPs

16
Objectives for CP minutes table

• Non discriminatory methodology
• Must accommodate route variability
• TEST 1
• Must show same circuits required for same minutes
  overall
• TEST 2
• Extra E1s required lt Number of contractions

17
Common Methodology

• Select sample routes
• Calculate Common Calculation
• Average profile for each CP
• Average not good enough
• Need to allow for variability between routes
  (Standard Deviation)
• Exclude low usage routes with unrepresentative
  profile
• Calculate VICs required for each route
• Apply Tests

18
How Many Minutes Table(s)?

• There will potentially be 3 tables per CP
• DLE table generated from fully provided routes
  only
• High Usage Route Table generated from
  qualifying routes
• Egress only
• Up 6XE1 in size
• In line with current SIA provisions
• Tandem Table
• Applies to those CPs taking consolidated traffic
  only
• Recognises that this traffic may have a different
  profile
• Generated from tandem route sample

19
Representative Routes?
20
Will we get it right in all cases first time?

• Probably not, and even if we do you may not have
  confidence in that
• Suggested way forward is
• Review post first tranche transfer
• Enshrined in the VIC schedule
• CP specific review (based on common principles
  and methodology)