In the largest project of its kind, British Telecom will spend ¿10 billion (about $19 billion) between now and 2011 replacing its entire public switched telephone network--which serves 22 million subscribers--with a network based on Internet protocol (IP). The company began its first trial of what it calls 21CN (for 21st-century network) with a single exchange in Cardiff, Wales, on November 28 of last year. Rollout is scheduled to begin in 2008.

Genius or madness? The sheer expense and scale of this project mean the stakes are high. Ralph Cochrane, director of corporate development in charge of 21CN, says it has been called both. "I think we're slowly proving we're not mad," he says. Companies such as Telecom Italia, which has an IP-based long-distance backbone, have accomplished some of what British Telecom hopes to do. "But no one else is ripping out their entire network and putting in a shiny new one based on IP," Cochrane claims.

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