British Telecom expands U.S.-based MPLS net

If your company has major European operations, British Telecom has you in its sights.

Two years after abandoning its Concert joint venture with AT&T, BT is going it alone with a focused effort to build its IP services business among U.S. multinational corporations.

BT is the subject of the fourth installation of an ongoing series about the reach, focus and stability of today’s top-tier, global ISPs.

Network executives needing Internet access in many locations around the world have six main ISPs to consider: AT&T, BT, Equant, Infonet, MCI and Sprint. In previous newsletters, we profiled AT&T, Equant and Infonet (see the newsletter archive at https://www.nwfusion.com/newsletters/isp/index.html).

After years of turmoil, BT’s IP business has stabilized. BT first teamed with MCI on IP services, then pursued opportunities alone, then teamed with AT&T and is now alone again. BT Americas officials say the confusion is behind them now, and that they are moving ahead with a build-out of a leading edge, global IP network.

In the U.S., BT runs two separate networks: one for frame-relay traffic and the other for IP traffic. The U.S. frame-relay network has eight nodes and accounts for 20% of BT’s traffic.

BT’s IP network in the U.S. has 15 nodes that use Multi-protocol Label Switching (MPLS), an emerging technology that provides different classes of service for network applications such as voice, data and video. Approximately 80% of BT’s U.S. network traffic is IP.

“In the U.S., our MPLS network is more expansive than our frame network,” says Kevin Moss, director of product operations for BT Americas.

BT added seven MPLS nodes in 2003 and plans to add eight more in 2004 for a total of 23 MPLS nodes, all located in major U.S. cities.

BT says its MPLS network has the advantage of being a stand-alone network that doesn’t ride over an older frame-relay or asynchronous transfer mode network. “We see that as a differentiator, especially with voice and multimedia traffic where performance is more critical,” Moss says.

Nonetheless, BT also supports many companies that run hybrid frame/IP networks.

“Some of our customers are comfortable with the frame/ATM hub-and-spoke networks and want to stay with them,” Moss says. “Customers at the other extreme…want their traffic on the MPLS network. Then we have a group of customers in the middle of that transition that want IP-enabled frame or MPLS private virtual circuits.”

BT’s MPLS network is one of the most extensive in the U.K. and Europe, extending into 70 countries with access from more than 1,000 points of presence. By March 2004, BT will offer MPLS services in another 15 countries.

Indeed, Frost & Sullivan recognized BT last year for the integrated IP services it provides to multinational corporations. Frost & Sullivan analyst Niamh Spillane said in a statement that BT’s “extensive points of presence coverage and reach, combined with consistent improvements in service-level agreements and pricing methodologies, have further enhanced the company’s reputation as a leading customer-oriented IP VPN solutions provider.”

BT’s MPLS network serves about 1,200 customers globally, including Honeywell, Visa, National Car Rental and Volvo. The company’s global MPLS network is growing at the rate of 1,000 customer-sold ports per month.

BT officials say their MPLS-based offerings are a good fit for global companies in dynamic industries. That’s because MPLS makes it easier to change networks by adding or deleting locations to accommodate mergers and acquisitions.

“MPLS lends itself to [organizations with] a rapid rate of change,” Moss says. “You don’t have to build private virtual circuits. It’s easier to add locations, and the communications are any-to-any…You can make changes without all the expense. MPLS gives you more flexibility at a similar or lower cost” than older technologies like frame relay and ATM.

Next Newsletter: BT expands application services.