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CHICAGO--When BT set out to determine its network strategy for the 21st century, the dominant British carrier was looking at bleak times. Competition was up, revenues were way down and the company realized its traditional telecom network was not prepared to handle converged voice, data and video services, said Paul Reynolds, chief executive of BT Wholesale.

Reynolds, who will deliver Tuesday’s keynote speech at the IEC Executive Forum @ Supercomm, said the company had to choose between “managing for cash or investing for growth.”

“It was risky to think about investing more at that time, but the risks for doing nothing were too awful to contemplate,” he said. “Our board took a strategic decision to drive for an all-IP network.”

After considerable research, BT developed its 21st Century plan and then proceeded to make some very un-telco-like decisions on its implementation, Reynolds said. First, the company realized it couldn’t make the switch to an all IP-network through the usual evolutionary process.

“We realized that this isn’t something you can do incrementally,” he said. “The business case is based partly on adding new services and partly on reducing costs. As long as you are operating even part of the old network, you are not getting the cost savings, and the longer you do that, the worse the business case gets.”

Second, BT turned its usual planning process on its ear.

“Instead of thinking through how long it would take to design, engineer, deploy, and debug – which would probably take 15 years – we decided to look at how much time have we got before the competition kills us, or before we run out of cash,” said Reynolds. “We knew we couldn’t afford to go slowly, so we decided to really challenge ourselves on how we do it.”

That challenge led to “many nights, weekends and cancelled vacations” developing vendor requirements and looking at proposals from 300 vendors before announcing the first vendor partners April 28. That announcement sent ripples through the telecom industry, as many viewed BT’s 21st Century network as the blueprint for the industry’s future.

“The vendor community has had to break from their normal practices as well,” said Reynolds. BT put technical requirements and operational practicality--product availability, manufacturing capability and field support--ahead of price in its vendor selection, which “is a big change for us,” he added.

“We know this is a reference sale, and we had vendors falling all over themselves,” he said. “We knew we had to break from normal conventions and view whole life cost, and build everything as much as possible on open standards, where we had access to source code and could expect plug and play compatibility.”

The new network will be vastly simpler than the current infrastructure, as BT collapses its separate voice, frame relay, ATM and other separate networks.

BT begins implementation of the new network this year, moving one-third of a million customers onto the new platform.

“We’re building out the core metro nodes first, and then at the edge, we’ll build out to the customers we are cutting over first,” Reynolds said.