Opposition to Overlays Hangs Up Phone Companies

Telephone companies didn’t expect much of a fight when they pushed to introduce California’s first area code overlays in the San Fernando Valley and West Los Angeles.

An area code within an area code, overlays have been accepted in many cities as a less painful alternative to splitting area codes. New York City, Dallas, Houston, Denver and Atlanta all adopted overlays with only scattered protests, as did Maryland.

But the inconvenience of overlays--callers must dial 11 numbers instead of seven for local calls--has triggered a furor among customers in the 818 and 310 area codes. Businesses and homeowner groups--often at loggerheads--are united in their opposition.

The combination of residential, business and political outrage forced the California Public Utilities Commission to shelve a planned overlay in the 310 area code. The PUC has also put off a hearing scheduled for Thursday on a proposed overlay for the 818 area code so that a town hall meeting can be held on the issue that day in Van Nuys.

Pacific Bell and GTE Corp. say the overlays are needed to accommodate a surge in demand for additional phone lines for computer modems, fax machines, cellular phones and pagers.

But critics contend the so-called shortage was artificially created by phone companies competing for a greater share of a booming market. Critics want phone companies to open their books to prove claims of a number shortage and need for new area codes.

Telecommunications providers concede they have been caught off guard by the public outcry.

“We were surprised,” acknowledged Margaret Pascoe, director of regulatory numbering for Pacific Bell.

Perhaps they shouldn’t have been.

Some note Westside and Valley residents have a tradition of political activism when it comes to opposing anything they believe may diminish their quality of life--whether it’s a proposed development or dialing more digits.

“Most people in these areas are well-to-do,” said Joe Cerell, a veteran Los Angeles political consultant. “They have extra time on their hands to go to meetings, write letters and pick up the phone.”

Young and Old Unite in Fight

Sherry Bebitch Jeffe, a political analyst and a senior associate in the school of politics and economics at Claremont Graduate University, said the rebellion includes older residents and young professionals.

“These are people who are older, more educated, better off and more involved in their communities,” she said. “They come from a tradition of political activism, and they are being replaced by yuppies who use cellular phones and don’t like the inconvenience of dialing 11 digits.”

And overlay foes say they’ve only just begun to fight.

“Pac Bell and the PUC are going to have a rude awakening as to how active the business and residential communities are here in the Valley,” said Richard Close, longtime president of the Sherman Oaks Homeowners Assn.

Indeed, opposition to the Valley overlay plan has mounted since June 30, when an administrative law judge recommended the plan to the PUC over an alternative plan to divide the 818 area.

An overlay was supported by telecommunications companies, who say it will be less disruptive and divisive to their customers. Under an overlay, all new phone lines in the 818 area code would get the new--as yet undetermined--area code and customers with existing 818 numbers would keep them.

The overlay is being actively opposed by groups and individuals, including the United Chambers of Commerce of the San Fernando Valley, Encino Chamber of Commerce, City Atty. Jim Hahn, the Los Angeles City Council and the Los Angeles County Board of Supervisors.

The Valley Industry and Commerce Assn., a powerful organization that represents hundreds of Valley businesses, prefers an overlay to a split, but members dislike either option and want to explore other alternatives, association spokesman Scott Schmidt said.

The overlay battle is even being fought in cyberspace, where opponents have launched www.stopoverlay.com--complete with message boards and links to newspaper articles and state legislators’ Web sites. The Web page was started by overlay opponents on the Westside and has since expanded to cover the Valley fight.

Industry observers say they have never seen such a highly organized, broad-based brouhaha over an area code relief plan.

“I haven’t heard of that degree of protest on a grass-roots level,” said Jamie Mendelson, a telecommunications consultant for the Strategis Group, a Washington-based international market research company.

“In New York, there were protests when the overlay began, especially in Manhattan with people who had sentimental ties to their area code,” he said, “but nothing as far as legislation being introduced.”

Only Chicago comes close to Los Angeles’ opposition movement, Mendelson said. Consumers there have pressed the Illinois Commerce Commission to consider plans to stop overlays and force phone companies to pool unused numbers.

PUC Gets First Hint of Valley Opposition

California regulators got their first wake-up call from Valley consumers last month, when strong public opposition prompted the five-member PUC to defer action on the overlay proposal until after Thursday’s town hall meeting.

A similar meeting was convened by Assemblywoman Sheila Kuehl (D-Santa Monica) last month to discuss the 310 overlay, which is opposed by key homeowners’ associations and business groups on the Westside. Bowing to mounting protests, the PUC agreed to postpone the July 17 introduction of the 424 area code pending further review.

The Valley meeting was called by state Sen. Richard Alarcon (D-Sylmar), who said he wanted to give Valley phone users a chance to question state regulators about the plan.

Commissioner Carl Wood is expected to represent the panel at the Van Nuys public meeting, scheduled to begin at 6 p.m. at the State Building, 6150 Van Nuys Blvd.

In addition to Wood, Alarcon has invited representatives from area chambers of commerce, telephone companies and Assemblyman Wally Knox (D-Los Angeles).

Knox introduced the Consumer Area Code Relief Act to rescind the 310 overlay, ban future splits and overlays and create separate area codes for electronic devices requiring phone lines. The bill passed the Assembly and is now in the Senate Appropriations Committee.

The lawmaker took on the overlay issue after his Los Angeles district office was flooded with phone calls from constituents saying they kept getting the runaround from their phone companies when they demanded details on the area code relief plan.

“My staff alerted me that this was not a minor number of calls, but they were continuing and growing,” said Knox, whose district spans the southern Valley, West Hollywood and Westside. “It was an issue that deserved to be looked at.”

Knox acknowledges he was initially intimidated by the complex overlay issue.

“Phone companies said it was too complicated. We wouldn’t understand. There was nothing that could be done,” Knox said. “Frankly, I think that was everyone’s attitude. No one was doing anything.”

Still, Knox directed his staff members to learn everything they could about overlays and how to stop phone companies from instituting them.

“When we laid out all the information, our jaws just dropped,” he said. “There were things that could be done that had been laying around undone for years.”

FCC Requires the Additional Digits

Knox said his Westside constituents were particularly peeved about the confusion, frustration and expense involved in dialing 1 plus the area code and the number for local calls.

There is no technological reason why customers have to dial 11 digits, telecommunications representatives say.

Phone companies, they say, are merely abiding by a Federal Communications Commission regulation that requires the additional digits to ensure fair competition among phone companies.

Existing companies such as Pacific Bell already control most of the 7.9 million numbers in the 818 area code. Without 11-digit dialing, the FCC reasons, established phone companies would have a greater competitive advantage over newer companies that could only offer numbers with a different area code.

“The purpose of the 11-digit dialing rule is to level the playing field so that consumers, hopefully, will have a choice of local-service providers and more services at lower prices,” said Anna Gomez, chief of the FCC’s network services division.

The FCC, PUC and North American Numbering Plan Administration, the agency that doles out numbers to phone companies, are looking at several ways to better administer available numbers.

Currently, for instance, phone numbers are allocated to phone companies in lots of 10,000. Phone companies refuse to disclose how many of those numbers are in use, but critics contend many are not--creating a false shortage of numbers.

One of the proposed reforms is to reduce the amount of numbers allocated at a time to 1,000. Others include requiring telecommunications companies to return unused numbers and putting all pagers, cell phones, ATMs, modems and fax machines on a single area code.

Despite the public outcry, a coalition of telecommunications companies including Pacific Bell, GTE, MCI and Sprint is pushing for the area code changes, saying an overlay or split is necessary to accommodate the growing demand for additional phone lines.

“We are running out of available numbers that we can assign,” said Pascoe of Pacific Bell. “We are at 80% utilization in the 818 area code.”

Pac Bell and GTE, the two largest phone companies in Los Angeles, are pushing specifically for the overlay. That is the most efficient way to deal with the number crunch, Pascoe said, because it adds 7.9 million numbers to the pot. An area code can be overlaid three or four times, virtually assuring the area code will remain intact for years to come.

Also, she said, an overlay does not pit community against community in a squabble over the original area code.

“The telephone is a personal thing in everyone’s life: It’s in your office, your bedroom and even on your person,” Pascoe said. “Because of the ease of use and personal connection, people tend to forget how incredibly complicated telecommunication is.”

After Thursday’s town hall meeting, PUC members said they intend to weigh public comments before taking any action on the 818 overlay proposal.

The overlay issue will most likely be taken up again at the panel’s regular meeting Sept. 2, when the panel could approve an overlay, split or other alternative.

“I urge businesses and residents to get on top of this issue,” Alarcon said. “If they believe it will impact on their lives or livelihood negatively, they need to send a letter to the PUC posthaste, to let them know what their feelings are.”

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Overlay Headed Our Way?

The California Public Utilities Commission is considering implementing an area code overlay for the San Fernando Valley, tentatively set for August 2000. An area code within an area code, the overlay would allow existing phone users to keep the current 818 area code while all new phones in Valley homes and businesses would get a new area code. As an alternative, the PUC could divide the 818 area into two area codes. Pacific Bell and GTE Corp. say an area code overlay is needed to accommodate a surge in demand for additional phone lines. Critics say the number shortage was artificially created by phone companies to gain a competitive edge in a booming market.

POTENTIAL PROBLEMS FOR RESIDENTIAL AND COMMERCIAL USERS

An area code overlay would require callers in the 818 calling area to dial 11 digits even if those phones are in the same building or next door. Critics contend that 11-digit dialing would cause confusion, frustration and expense to residential and commercial callers.

Dialing: All callers are required to dial 1, plus the area code and the phone number to call residences and businesses within the 818 calling area. Elderly callers could have difficulty recalling and dialing 11 digits.

Security systems: Apartment and condominium complexes that use telephone lines to open security gates or doors must be reprogrammed. Tenants may not be able to buzz visitors in via the security system.

Modems and fax machines: Residents and small-business owners must reprogram electronic office equipment requiring telephone lines.

Cost of reprogramming: Businesses that rely heavily on telephones--periodical subscriptions solicitors, stock and bond brokers, pollsters--would bear the cost of reprogramming telephone dialing systems.

Additional phones: Expanding businesses adding new telephone, fax or modem lines after an overlay would have two area codes in the same building. Similarly, residents adding a second phone line would have two area codes serving the same house.

PENDING SPLITS AND OVERLAYS

*--*

Area Code Area Served Date 669 San Jose area 1/8/00 (overlays 408) 951 Riverside County 2/12/00 (1st phase of 909) 657 N. Orange County 10/7/00 (overlays 714) 935 E. San Diego County 6/10/00 (from 619, 3-way split) 341 East Bay (overlays 510) 7/15/00 764 San Mateo, Santa Clara 9/16/00 (overlays 650) 628 San Francisco 10/21/00 (overlays 415) 752 San Bernardino County 2/10/01 (overlays 909 2nd phase)

*--*

EXISTING OVERLAYS

Area code overlays have been rolled out with few protests in the following areas:

Atlanta

Chicago

Dallas

Denver

Houston

Maryland

New York

REASON FOR 11-DIGIT DIALING

There is no technological reason why customers have to dial 11 digits to reach a number in the same area code. The Federal Communications Commission, however, requires the additional digits to ensure fair competition among phone companies. If all callers have to dial 11 digits in the same calling area, officials said, then no one would have an unfair advantage of dialing fewer digits.

* Sources: Federal Communications Commission; California Public Utilities Commission; North American Numbering Plan Administration.

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To Be Heard

Residents and business owners have two opportunities to comment on a proposed area code overlay for the San Fernando Valley:

* Attend a town hall meeting at 6 p.m. Thursday at the State Building, 6150 Van Nuys Blvd., Van Nuys.

* Write the Public Utilities Commission at 505 Van Ness Ave., San Francisco 94102 or send an e-mail to Commissioner Henry Duque, lead commissioner on overlays and splits, at commissionerduque@cpuc.ca.gov.