John P. Compitello Dennis M. Maloney President EVP - Chief Technology Officer Compitello Associates VI

1. The Effects of 9/11/01 on the Telecommunications Network Infrastructure Resiliency - Problems Encountered by the Financial Community, Lessons Learned and New Network Infrastructure Necessity John P. Compitello Dennis M. Maloney President EVP - Chief Technology Officer Compitello Associates VIPer Media, Inc.

2. Network Infrastructure Problems Encountered by Financial firms • 200,000 Access Lines Out (Verizon-West Street) • 100,000 PBX/Centrex Lines Out (Verizon-West Street) • 4.4 Million Data circuits Out (Verizon-West Street) • 10 Cell Sites Destroyed (Verizon) • Other Carriers lost Cell Sites and Major Operations in WTC Building Complex • Many Firms Lost Large Parts of Their Private Networks • Some Firms Lost Parts of Their Data Center Operations • Many Firms Did Not Have Adequate Back-up Infrastructure • Back-up Network Services Failed Along With Primary

3. Network Resiliency Lessons Learned • There’s No Such Thing as Too Much Back-up! • Test and Re-Test Network Back-up Capabilities • Ensure Truly Redundant Network Connectivity • Distribute Network Much More Than in the Past • By-pass Serving Central Office Bottle-necks • Personnel Deployment Revisited - More Distributed Approach

4. Financial Firms Personnel Deployment • Goldman Sachs -Building Large Complex in Jersey City • Marsh & McLellan - Moving to Hoboken, NJ • Morgan Stanley DW - Moving to Harrison, NY • American Express - Deploying at two sites in New Jersey • Deutsche Bank - Building Back-up operation in Jersey City • Instinet - Building Back-up Trading Center in Jersey City • Lehman Brothers - Growing space in Jersey City and opened new operations in Mid-town

5. Post 9/11/01 Network and Personnel Deployment is much more diversified than in the Past Requiring a New Diversified and Much More Secure De-Centralized Network Infrastructure Approach

6. Network Infrastructure • Current Network Infrastructure Design • Switched Voice • Data and Private Lines • Business Continuity Approaches and Drawbacks • Financial Industry Concerns and Drivers • Potential New Architecture • Transition Mechanisms and Issues

7. Tandem Office Class 5 SONET ADM SONET ADM PBX Current Infrastructure – Switched Voice The World • Key Design Principle – The Central Office • Multiple Customers served by CO in “Star” Access Network • Local Loop Access Facility evolving from copper to Async. Fiber to SONET • CO’s linked by Tandem Offices to provide inter-connectivity and access to world • Features and capabilities controlled by the Carrier Customer B Central Office Customer D Customer C Primary Back-up Customer Premises

8. Tandem Office Class 5 Class 5 SONET ADM Customer Back-up Site SONET ADM PBX Switched Voice – Continuity • Multiple Disaster Scenarios complicate Continuity Planning • Loop • Central Office • Premises • Potential drawbacks: • Loop fiber routing • Code Throw vs. Call Forwarding • Inadequate trunks • Jurisdiction and Carrier Coordination • Centralized Carrier Control • Remote Users? Customer Primary Site

9. SONET ADM Current Infrastructure – Data and PL’s To Interoffice Network • Same Loop Access Infrastructure used to provide switched voice access • Nested DCS Devices providing “Grooming” and Cross-connecting of Lower speed services within high speed pipes • Frame Relay and ATM switches to provide public switched data services • End-offices linked by high speed interoffice facilities on SONET Rings • Voice PL’s a key application in the Financial Industry Carrier Central Office Frame/ ATM Switch SONET ADM Customer Premises

10. Back-up Site SONET ADM SONET ADM Private Line Continuity Approaches • Same Loop Survivability Issues as Switched Voice • Full recovery capabilities requires duplication of private lines from primary location • Additional duplication at back-up site • Costly and complicated to maintain on an ongoing basis • Dependent on Carrier Reconfiguration Services Primary Location

11. Industry Drivers Toward a New Design • Distributed instead of Centralized • People • Network Assets and Data • Convergence – Voice, Data and Multimedia on a single network • Reduce Capital and Operating Expense • Create New Capabilities • Virtual Companies and Workgroups • Remote Access and Mobility • Points toward the “Rise of the Stupid Network” • David Isenberg (1997) • The “Stupid Network” is characterized by: • Smart Applications at the Edge of the Network • A Resilient Network Designed to just move bits

12. Potential New Architecture Redundant Hosted Applications and Gateways Gateway Application Servers PSTN • Converge all services on a secure IP network provided by multiple backbone carriers • Take advantage of inherent survivability of IP networks • Enabled by emergence and development of SIP, MPLS-VPN and QoS management protocols • Supports distributed applications and user community • Location is irrelevant to services available • Applications developed and maintained separate from network infrastructure Internet Multiple Carrier IP Backbone Network DSL Cable Modem Diverse and Redundant Loop Access Remote or Small Office User Primary Location

13. Transition Issues and Mechanisms • Loop Access facility diversity remains a primary design concern – will require close attention to cable routing of participant carriers • Two transitions will be required – first to a survivable optical loop access infrastructure • Conversion to IP required to attain full functionality • Timing of transition will be driven by existing agreements between customers and carriers • A critical mass of services identified by a consortium of users can drive the process • A flash cut will not be possible – mechanism for communicating between domains will be required