I&P: Contracts Clinic 24/02/06 1 Minutes Table Derivation & Application of Overflow The focus of the...

1I&P: Contracts Clinic 24/02/06

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


Context

Ofcom determination:

• NCC Technology Neutral Charging

BT intends to move to 21CN:• DLE Closure

Maintaining LES Rate:

• BT solution is Virtual DLE interconnect


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.


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 DLE’s traffic can’t 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


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 E1’s 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)


Some people get more minutes than others from an E1

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Hourly Traffic Peak Average

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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


Minutes Table Objective:

Minutes per day

255 132 320E1 TC4 Erlangs Day Evening Weekend

1 19.8 5,049 2,614 6,336 2 45.1 11,501 5,953 14,432 3 70.8 18,054 9,346 22,656 4 96.4 24,582 12,725 30,848 5 122.2 31,161 16,130 39,104 6 148.1 37,766 19,549 47,392 7 174.0 44,370 22,968 55,680 8 200.0 51,000 26,400 64,000 9 226.1 57,656 29,845 72,352

10 252.1 64,286 33,277 80,672 11 278.2 70,941 36,722 89,024 12 304.3 77,597 40,168 97,376 13 330.5 84,278 43,626 105,760 14 356.6 90,933 47,071 114,112 15 382.8 97,614 50,530 122,496 16 409.0 104,295 53,988 130,880 17 435.1 110,951 57,433 139,232 18 461.3 117,632 60,892 147,616 19 487.5 124,313 64,350 156,000

Average Mins per day per peak hr erlang:

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

Minutes per erlang per day reflects CP specific traffic profile

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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

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Issue 81

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

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15% overflow

+15% capped

Fully in TC4• Blue scenario – traffic fits in TC4

• 15% growth gives purple mins @ LES + red at ST


There are benefits of this approach:Monthly tables smooth daily and weekly variations

Traffic spikes will generate less ST rate calls


Call Termination Call Termination Local Exchange Single Tandem Call Termination ST / LES DifferenceDay Evening Weekend Day Evening Weekend Daytime Evening Weekend

01/04/2006 0.2466 0.1129 0.0889 0.3537 0.1619 0.1275 0.1071 0.0490 0.0386

CARRIER PRICE LIST Section B1 Part 1.02 Telephony - Operator Services (BT to OLO) Issue Date:Issue:

1.2.3 BT Originated Calls to Operator Number Translation ServicesFor terms and conditions applicable to these charges see the relevant Schedules listed.

Rates Effective from 1 April 2006

NTS CLI ppmST / LES Difference

Service CB Sched Discounts Daytime Evening Weekend Daytime Evening Weekend Daytime Evening WeekendOperator Free Phone z 311 none 0.4733 0.2167 0.1706 0.5804 0.2657 0.2092 0.1071 0.0490 0.0386 Operator International Incoming Free Phonez 307 none 0.4733 0.2167 0.1706 0.5804 0.2657 0.2092 0.1071 0.0490 0.0386 Operator LCFA Long ll 312 lcfa -2.2254 -0.5074 -0.4998 -2.1183 -0.4584 -0.4612 0.1071 0.0490 0.0386 Operator International Incoming LCFAll 307 lcfa -2.2254 -0.5074 -0.4998 -2.1183 -0.4584 -0.4612 0.1071 0.0490 0.0386 Operator LCFA Short ls 312 lcfa -5.1362 -2.0486 -2.1443 -5.0291 -1.9996 -2.1057 0.1071 0.0490 0.0386 Operator Schools 0820 Long sil 368 lcfa 0.0000 -0.4427 -0.4998 0.0000 -0.3937 -0.4612 0.0000 0.0490 0.0386 Operator Schools 0820 Short sis 368 lcfa 0.0000 -2.0486 -2.1443 0.0000 -1.9996 -2.1057 0.0000 0.0490 0.0386 Operator National nat 315 ncfa -5.9297 -3.1401 -1.0292 -5.8226 -3.0911 -0.9906 0.1071 0.0490 0.0386 Operator International Incoming Nationalnat 307 ncfa -5.9297 -3.1401 -1.0292 -5.8226 -3.0911 -0.9906 0.1071 0.0490 0.0386 0808 90 & 99 FRIACO & Hybrid z 393 none 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0.0000 0844 09 P-A-Y-G g4 391/4 int -1.1775 -0.6751 -0.6839 -1.0704 -0.6261 -0.6452 0.1071 0.0490 0.0386 0844 04 SurfTime g5 391/4 int 0.0000 0.0000 0.0000 0.1071 0.0490 0.0386 0.1071 0.0490 0.0386 1p Operator 0844 NTS Calls g8 411 int -0.6055 -0.7931 -0.8313 -0.4984 -0.7441 -0.7927 0.1071 0.0490 0.0386

other/none -0.6163 -0.8028 -0.8408 -0.5093 -0.7537 -0.8022 0.1071 0.0490 0.0386 2p Operator 0844 NTS Calls g9 411 int -1.3154 -1.5716 -1.6027 -1.2083 -1.5226 -1.5641 0.1071 0.0490 0.0386



other/none -2.9412 -3.2379 -3.2759 -2.8342 -3.1888 -3.2373 0.1071 0.0490 0.0386 5p Operator 0844/0871 NTS Callsg6 41X int -3.8159 -4.0757 -4.0808 -3.7088 -4.0267 -4.0422 0.1071 0.0490 0.0386





other/none -7.1862 -7.4781 -7.5307 -7.0792 -7.4290 -7.4921 0.1071 0.0490 0.0386 Operator 0844/0871 NTS Calls g16 41X int -1.2601 -0.7184 -0.7783 -1.1530 -0.6694 -0.7397 0.1071 0.0490 0.0386





other/none -3.6504 -1.9266 -1.5304 -3.5434 -1.8775 -1.4918 0.1071 0.0490 0.0386 Operator 0844/0871 NTS Calls g22 41X int -0.0395 -0.3094 -0.3703 0.0676 -0.2604 -0.3317 0.1071 0.0490 0.0386

other/none -0.0451 -0.3147 -0.3756 0.0619 -0.2656 -0.3370 0.1071 0.0490 0.0386 10p Operator 0871 NTS Calls g7 410 int -7.9494 -8.2351 -8.3018 -7.8423 -8.1861 -8.2632 0.1071 0.0490 0.0386

other/none -8.0269 -8.3124 -8.3791 -7.9199 -8.2633 -8.3405 0.1071 0.0490 0.0386 1p Operator IP Network Calls i3 39X none -0.4560 -0.7272 -0.7873 -0.3490 -0.6781 -0.7487 0.1071 0.0490 0.0386

1.2.3.1 BT Originated Calls to Operator Number Translation Services (Standard Calls)Direct Handover Direct HandoverLocal Exchange Single Tandem

• 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

Excess Charge


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 doesn’t 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)


Application of Minutes Table(conceptual model subject to solution design)


Overflow: CP Originated Calls

CP NGSNGSDLE

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)


Calls sent via alternative NGS

• Rated according to options at alternative NGS

Overflow Minutes either ST rated or virtual excess but never both


Overflow: BT Originated Calls

CP NGSNGSDLE

Segregated Routing Option:

Calls sent via DLE route segment (identified by Route ID in routing plan)


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)


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


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


Objectives for CP minutes tableNon discriminatory methodology

Must accommodate route variabilityTEST 1:

Must show same circuits required for same minutes overall

TEST 2:

Extra E1s required =< Number of contractions


Common Methodology

1. Select sample routes

2. 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

3. Calculate VICs required for each route

4. Apply Tests


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 CP’s taking consolidated traffic only

Recognises that this traffic may have a different profile

Generated from tandem route sample


Representative Routes?

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Sum of UnderProvided RouteCount

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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)

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I&P: Contracts Clinic 24/02/06 1 Minutes Table Derivation & Application of Overflow The focus of the...

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