STANDARD CONTRACT FORUM 29 JANUARY 2004: for information Copy of BT Service Level Commitment Discussion Paper dated 14 January 2004
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Introduction
Oftel’s review of the fixed narrowband wholesale exchange line, call origination, conveyance
and transit markets says that the BT reference offer must contain service level commitments.
BT’s response to the Oftel consultations expressed the view that such commitments should be
discussed and agreed with industry. BT has, therefore, produced this principles discussion
document to help facilitate such discussions. This document sets out the general principles,
which BT believes are applicable to a range of situations, and also outlines how they might be
applied in areas where BT and the Industry has previously discussed service level
commitments.
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General Principles.
The provision of service level commitments can be of benefit in helping ensure the efficient
operation of services which rely on co-operation between two interconnecting operators.
However, if not employed carefully they can result in complexity and unnecessary cost to
both parties. By concentrating on key factors which can be effectively measured BT believes
that a balance can be struck which encourages efficiency whilst minimising the overheads
associated with such schemes. The key principles which BT believes need to be considered in
each case are outlined below.
2.1 Simplicity – In providing or repairing a service, there will often be a number of
interactions between the two parties. A number of these, such as the acknowledgement of a
request, are integral parts of the process. However, the most important issues are those which
impact on the service. BT believes that any agreements should be based on service affecting
issues, rather than all parts of the implementation process between the two parties. This will
help avoid unnecessary administrative costs for both parties.
2.2 Limit Commitments to Activities Under the Control of Provider – It would not be
reasonable for commitments to be set against activities which are not fully under the control
of the provider offering the commitment where corresponding third party commitments are
not feasible. This applies to dependence on the requestor and other third parties, especially
those such as government bodies, where the provider cannot establish effective control of
timescales. Activities therefore need to measure from a point at which the requestor has met
all pre-requisites.
2.3 Measurement from Agreed Dates – In providing interconnect services, standard
provision timescales are normally agreed. However, the agreed date may be dependent on
factors such as abnormal demand, or the requestors own requirements. In such cases
performance should be measured against the agreed date rather than any normal maximum
timescale. If a requestor felt that the provider was unreasonably not offering completion
within normal timescales, they would have the option of raising this as a dispute.
2.4 Measurement – Any agreement needs to take into account the practicability of both
parties being able to measure the activity associated with the commitment. Any agreed
measure should take into account the need to minimise unnecessary costs and as far as
possible, seek to use measures which can be efficiently obtained from the parties existing
systems.
2.5 Reciprocity – As interconnection requires co-operation between both parties each party
is both customer and supplier to the other party. Therefore, the provision of any
commitment(s) should be established on a reciprocal basis.
2.6 Failure by Requesting party to meet commitments to provider – Within some
processes a provider will commit resource and expenditure based on the agreement of the
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requestor to meet specific obligations. e.g., being available to jointly test new services. As
well as the direct impact on the provider, such as the waste of resource, a significant level of
such failures can impact on the provider’s ability to meet other requests; from the same and
other requesters. In areas where service level commitments are necessary, commitments
should also be provided by requestors.
2.7 Commitment Payments – In general payments should normally be linked to the price
of the product and be incremental depending typically on the amount of delay in providing the
service.
2.8 Commencement of commitment payments – These will normally be linked to the
extent of which a target has not been met. These should not necessarily start at the point at
which a service level is not met as this may discourage improvements to performance. For
example, if there is a commitment to provide a service within a specified period, commitment
payments might start a short time after this is exceeded.
2.9
Force Majeure – If as a result of a Force Majeure Event either party is:
 prevented, hindered, or delayed in performing its obligations under any agreement, it
should continue performing those obligations under that agreement that are not
affected by the Force Majeure Event.
 prevented from providing a service under an agreement, the other party should be
released to the equivalent extent from its obligation to make payment for the service.
2.10 Two areas in which service level commitments may be applicable are those of Data
management Amendments and interconnect Links. Specific points in relation to these are
outlined below.
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Data Management Amendments (DMAs)
3.1
Any service level commitment should:
 set out the working level arrangements between BT and other Communications
Providers for notifying each other of the launch, amendment, or withdrawal of
network services;
 be bilateral (reciprocal) as appropriate between BT and each Communications
Provider;
 represent a statement of working practices to which both parties will aim to adhere;
 supplement information contained in the NCCSIA but not seek to vary the terms and
conditions of the NCCSIA;
 be consistent with the legal and regulatory framework within which both parties
operate.
3.2
Standard timescales for the implementation of DMAs are defined in Appendix C of
Annex A of the NCCSIA. Agreed completion dates between BT and another
Communications Providers may fall outside of these at the request of either party. Both
parties should aim to complete a DMA by the agreed requirement date rather than a
standard timescale.
3.3
Major projects (e.g. DQ118) may need to be treated as a special case which may require
the suspension of standard timescales. Such cases should be consulted with industry and
Ofcom.
3.4
In discussing any payments for failure to meet any commitments, the following should
be taken into account:
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STANDARD CONTRACT FORUM 29 JANUARY 2004: for information Copy of BT Service Level Commitment Discussion Paper dated 14 January 2004

Communications Providers do not generally charge each other for DMAs. Therefore,
commitment payments cannot be based on a percentage of the implementation
charge;
revenue is generated by the call traffic enabled by the implementation of a DMA. If
call traffic is never generated by the DMA e.g. because a number range has been
built but not brought into service, the Communications Provider has no opportunity
to directly recover the cost of implementing the DMA.

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Interconnect Links
4.1 Any service level commitment for the provisioning and repair of interconnecting links
should:
 be bilateral (reciprocal) as appropriate between BT and each Communications
Provider;
 represent a statement of working practices to which both parties will aim to adhere;
 supplement information contained in the NCCSIA but not seek to vary the terms and
conditions of the NCCSIA;
 be consistent with the legal and regulatory framework within which both parties
operate.
4.2
Service levels are defined in section 11 of Annex A including timescales for the
provision of capacity.
4.3 Some payments for failing to meet commitments are currently included in Annex A.
N.B These should be read in the context of the whole document (Annex A) and not in
isolation, but are listed below for information purposes):

for not placing Capacity Orders for a minimum of 80% of the aggregate Capacity
specified in the relevant ACOs for each Switch Connection;

the Supplier of Capacity in excess of the relevant limit may raise charges to cover
additional costs that it may incur arising directly from the provision of Capacity
outside the normal planning process;

If a Capacity Order is cancelled more than 10 Working Days after placement of the
Capacity Order, the cancelling Party shall pay a cancellation charge;

If the Party providing Capacity fails to commence testing of that Capacity by a date
25 Working Days after the relevant periods of time, then the Party providing such
Capacity shall pay on demand to the other Party liquidated damages for such delay.
4.4 In discussing any commitment payments for non-availability of interconnecting links
the following should be taken into consideration:

At present there is no contracted time to clear faults. (Timescales are quoted in the
O&M manual but this is not part of the contract);

Any form of payment system will require a process or method of proving that a fault
or problem is definitely attributable to a Communications Provider.
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