JON Exchange Today s network KCom Openreach Virgin

JON Exchange

Today’s network KCom Openreach Virgin Media

Tomorrow’s patchwork – Today! Angus Glens Manchester Cardenden Alston Fibrecity Dundee Hull WWHC County Durham KCom Fibrespeed Baltic Quarter Digital Region Openreach Virgin Media Derby Lace Market Birmingham Cornwall Bristol 2012 Fibrecity Bournemouth Corby Quintain Bradnet Ashford East Nottingham

The “Big 6” ISP’s have more than 90% of the UK market Scale Matters!

The Big ISP’s. . . Already have ar ound a fifth of a ny available ma r ket Any source single thin From a cos t & g els com e ad ple ds xity

This works! … for them at least

This doesn’t! … for them or anyone

This could! … for everyone!

This could! Joint Open Network Exchange … for everyone!

JON Exchange • • 1 market-place Manchester Oxford Road Gateshead Gti 1 set of interface specifications 1 set of tradable assets Fibre. Speed No controlling interests Open Marketplace • Meeting place for – Middle-mile services – Peering & transit – Backbone connectivity. BMEX – Managed platforms Durham. Net NYnet Digital Region

Two key words i. D u i. Q l Fungib Liquid Fungible adj (finance) goodsin cash or (law) of fluid: or commodities; freely easily convertible to cash; exchangeable for or replaceable by "liquid (or fluid) nature or kind in the another of like assets" satisfaction of an obligation. le

Past attempts • Failed to identify tradable fungible assets – Bandwidth is not fungible • Tried to create secondary markets without a primary spot market – Future bandwidth trading needed a primary spot market

An Open Market Passive • Duct A metre of sub-duct • Dark & Liquid Fungible Fibre. A metre of unlit fibre • Standards adopted from COTS & NICC • Maintenance & evolution by market members in • Wavelength A specific lambda line with standards bodies Active • Layer 2 An ALA VLAN

ALA: A break from the past Content Delivery Networks Games on Demand New Media. Public Services Remote Internet ISP Email Web Voice IP Access Local Network Provider – BT, Fibrecity, Eurofiber, Onestream. . BT Line Access Customer

Wholesale Model Service Provider • • • The Market Network Provider The Market will log transaction Pro-forma market “contracts” information • For buy price mechanisms Offer &Ofcom • For the Ombudsmen Settlement system leading to a market set “spot price” Seeking interface Standardto create an open & fair telecoms marketplace

Thoughts on a secondary market Capacity Supply-side Planning = Future Demand-side Option Forward dated contracts to buy network services • NHS tele-care patients, LEA school children, housing associations, communities • Network builders could take the contracts as anchor tenants and collateral

Summary - Why this can work • Fungible assets – Not based on bandwidth – Metre of duct, metre of dark fibre, a wavelength, a VLAN – Each asset is sufficiently homogenous to compare, and different enough to generate market choices • Liquidity – European scale – Transition conditions until experience & scale are sufficient – Market operation will lead to a fluid, fair market

Summary - Next Steps • Trading Platform – Interface system – Trading & settlement • Technical/Operational Standards – NICC & BSG/COTS – INCA • European Governance structure Aiming for operation in Q 4 this year

Thank you! Adrian Wooster awooster@jon-exchange. net www. jon-exchange. net