Convergence - changing the way we live and work

Chris BruceGeneral Manager Wireless Broadband

A true multi media experience which will transform the way we communicate

Voice and Data

A fusion which allows customers to

enjoy the best of both worlds

Fixed and Mobile

Enabling businesses to deliver the most appropriate information or communication when and where required

Comms and IT

Reinventing home entertainment

Media & entertainment

Convergence sits at the heart of this change

UK Customer Likelyhood to Use Online FAQ's as First Line Support

0

10

20

30

40

50

60

Q2 2003 Q4 2004

%

Changing consumer behaviours

Growing preference to take services online:

Transacting Self ServiceOnline Buyers in The UK (as a % of Internet users)

50

52

54

56

58

60

62

64

2003 2004

%

Source: eMarketer, June 2005 Source: Forrester, Best Practises, June 2005

Changing customer behaviourGrowing preference to use mobile services:

Percentage of mobile revenue generated by voice and data

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

90.0%

100.0%

2004 2005 2006 2007 2008 2009Data / Content Voice

Global Mobile Subscribers

0

500,000,000

1,000,000,000

1,500,000,000

2,000,000,000

2,500,000,000

3,000,000,000

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

Western Europe ARPU Forecasts

0

5

10

15

20

25

30

35

40

2004 2005 2006 2007 2008 2009 2010

(US

$)

Sources: Ovum Sept 2005 & Analysis 2005

• Broadband access is becoming the norm for residential Internet users with well over 50% of Internet homes in leading markets now having broadband

• 274 million homes will have broadband by 2008, up from 100 million end 03

• UK Broadband penetration has accelerated from 2% to 26% in 3 years

• In April, BT connected our 5 millionth DSL connection – a year ahead of target,

…...now over 5.6 million.

• A new broadband connection every 10 seconds

• Currently 99.7% of UK households can

receive ADSL broadband, rising to 99.9% by end 2005• There will be 20million users of public Wi-Fi services across

Europe by 2006 (source: Gartner)

• 71% of European Enterprises plan to have wireless networks by 2007 (source: Datamonitor)

Broadband market is gaining real momentum

Global Broadband Household Forecast

100

142

183219

247275

0

50

100

150

200

250

300

Mill

ion

Sub

scrib

ers

2003

2004

2005

2006

2007

2008

BT Openzone is growing(Y/Y growth)

Voucher Sales – 443%Sessions – 348%Minutes Used – 431%

Our home life will never be the same againNew devices and services using broadband

Personal content

Home monitoring

Gaming

PC

EntertainmentHome hub

Voice servicesBT Fusion

… and our working lives

Security andmonitoring

Office hub

Voice services

Productivity Tools e.g. Exchange online

Outsourced IT & Virtual IT Manager

VoIP & Video Conferencing

Wireless Networking

Connected anywhere A wireless world - through convergence

BluetoothBluetoothWi-FiWi-Fi

PublicPublicWi-FiWi-Fi

Private/GuestWi-Fi

Seamless, ubiquitous, easy to use & secure

Public Wi-Fi

Connected anywhere - BT Building the future

Over 7800hotspots in the UK

Over 30,000 hotspots globally

Enterprise wireless LAN & guest Wi-Fi

Mobile Express Professional: Connected Anywhere!

At Home:• Broadband• Switched

On-the-Road:• 3G/GPRS/GSM• CDMA• AirH’/PHS

In the Office:• Ethernet• Wi-Fi• Broadband

At a Venue:• Wi-Fi• Broadband• Switched

Remote Office:• Broadband• Wi-Fi• Switched

In the Air:• Wi-Fi• Broadband

In the Hotel:• Ethernet• Wi-Fi• Switched