Super-fast fibre: an enabler of business innovation. Clive Selley CEO BT Technology, Service & Operations & BT Group CIO

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1 Super-fast fibre: an enabler of business innovation Clive Selley CEO BT Technology, Service & Operations & BT Group CIO

2 In 2008 BT made a bold bet on fibre On 15 July 2008 BT surprised the world with a bold plan to roll out fibre broadband to 10 million UK households. BT subsequently upped its commitment to 2.5bn, to cover two-thirds of the UK with fibre. Additional funding from government and local authorities has helped unlock further investment from us to reach less economic areas, taking the total BT commitment to over 3bn. 2

3 We ve rolled out our fibre network in record time More than 20 million homes passed with fibre in 5 years. >2/3 of the UK now has access to BT s superfast broadband. With the help of BDUK, the UK will reach around 90% coverage by the end of Superfast Extension Programme and other opportunities will increase this further. and we re currently extending fibre s reach by 70,000 premises a week. 3

4 and it s paid off. Britain s internet economy is booming and we re riding high in the league tables Individuals purchasing online 1 G8 download speeds 1 Index of internet strength and activity 2 Japan UK Germany Russia UK USA Germany Enterprises purchasing online 2 France USA Canada Italy France Spain Italy Mbps Source: Eurostat, July Notes: (1) % of population using the internet to order goods & services in the last 3 months. (2) % of SMEs using any computer network for purchases (2012 data) 1 Ookla Net Index, April The value is the rolling mean throughput in Mbps over the past 30 days where the mean distance between the client and the server is <300 miles 2 Boston Consulting Group e-intensity Index, December Index is a yardstick of internet strength and activity across nations 4

5 Fibre is at the heart of BT s evolution too BT is now an established TV broadcaster. Fibre is instrumental to providing our customers with great TV content. Over one million TV customers. More than 140 channels including HD channels. Interactive services like YouView. It is driving usage: median fibre customer usage is 3 times that of copper based broadband per month. Our new fibre network underpins our inside-out strategy for mobility. BTWi-Fi network of over 5m hotspots. And in future, we will add our 4G spectrum, combining wi-fi and 4G in a single router. BT One Phone launch consumer mobile services to follow later in the year. 5

6 Fibre is underpinning economic growth, allowing businesses across the UK to evolve some case studies from Cornwall Trading on a Global Scale An internet services company in Bodmin, Cornwall, England creates cloud services for the Apple Mac. 75% of its market is in the USA. Reaching niche markets A horticulture company in Chacewater, Cornwall, specialising in climbing and conservatory plants, uses the internet to reach out to a globally distributed niche market. Small companies can compete with large ones A small company specialising in phone systems for the leisure industry operates on a national scale to compete successfully with very large companies. 6

7 and helping us to grow a thriving tech sector The UK s leading position in fibre access is helping to support our thriving UK technology sector. BT s Infinity Lab programme brings new businesses together with BT s fibre products. Encouraging the growth of brand new services and applications running over fibre, driving take-up and helping to boost the economy. We ve run three competitions so far as part of the Infinity Lab programme, focused around finding, and supporting, cutting edge applications that can make an impact on: Consumers The B2B market Helping to create a more connected society, in conjunction with our Better Future programme We ll be running more competitions in coming months looking for the next generation of companies who have bright ideas. 7

8 Core traffic (Gbit/s) Demand for bandwidth is growing Key future demand drivers Current view of near-term core capacity trend Over the Top content Video on Demand 4k/8k content delivery Cloud-based applications Rich media webpages Concurrent application use Customer expectations of speed *Source: Domestic Demand for Bandwidth Broadband Stakeholder Group,

9 So we mustn t stand still innovation is essential to keep the UK on top Driving faster speeds FTTC Vectoring; FTTRN VDSL closer to the customer; FTTDP G.Fast; FTTP. Extending reach We are innovating to extend benefits of faster access to the final c. 10% of coverage. Copper rearrangement Broadband regenerators for ADSL Microwave wireless to the cabinet VDSL amplifiers Fibre to the remote node (mini DSLAMs) Boosting the Core Real-time 2.2Tbps connection over managed Flexgrid infrastructure. 33.5GHz spacing giving spectral efficiency of more than 49% Test run between Adastral Park and BT Tower, partnered with Huawei. 100G Superchannel 400GHz 2.2T (11 x 200G 16-QAM) 100G 9

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