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Starting with the creation of the North American Numbering Plan in 1947, new area codes were introduced by dividing an existing numbering plan area into multiple regions. One of these regions, usually the historically more established or developed place, retains the existing area code, requiring no numbering changes in that area. This makes available in that area the central office codes of the other parts of the old numbering plan area, thus enlarging the number pool. However, all subscribers in the newly assigned area are required to update telephone number references, such as on letter heads, business cards, and in directories. For example, the original area code for the entire state of Washington was 206; today 206 applies to only the city of Seattle and the immediate vicinity. This practice became known as a split plan.
In an overlay numbering plan, the change of the area code for numbers in parts of the existing numbering plan area is avoided by assigning additional area codes to the entire region of an existing code. The first use of this solution was in the borough of Manhattan in New York City, where area code 917 was added to the original 212.
In several cases, overlay plans were implemented on a special case basis to implement specialised dialing plans. In some areas, a party in one area code could dial an office prefix which was local, but in a different area code, with only 7 digits. If they were calling a distant office prefix in the same area code, they would either have to dial 1 and the number or 1+area code+number.
This practice was implemented on a large scale in Washington, D.C. and its suburbs in Maryland and Virginia. Until 1991, the entire region was a single local calling area, and it was possible for anyone living in the metro area to dial a number in D.C. or the Maryland and Virginia suburbs with only seven digits. This setup was possible because the entire Washington metropolitan area is a single local access and transport area (LATA). Every number in Maryland's area code 301 and northern Virginia's 703 was given a "hidden" phone number consisting of the same number in the D.C.'s area code 202, essentially making area code 202 an overlay for the entire region. This meant a Virginia number, such as 703-931-xxxx, could also have been dialed as 202-931-xxxx, while a Maryland number, such as 301-585-xxxx, could also be dialed as 202-585-xxxx. However, this meant that a central office code could only be duplicated in areas a safe distance from the metro area such as southwestern Virginia or the Eastern Shore of Maryland. By 1991 the use of 202 as a de facto overlay was discontinued due to growing demand for numbers, and callers in the area dialing an out-of-area-code number had to dial the full 10 digit number.
A similar scheme was employed in Canada's capital, Ottawa. It shares the same calling area as Hull, its twin city in Quebec, even though Ottawa was in area code 613 and Hull was in area code 819. Until 2006, it was possible to place a call between Ottawa and Hull with only seven digits. This continued even after Hull was merged into the larger city of Gatineau in 2002. This was implemented in a way that the same number could not be duplicated anywhere in eastern Ontario or western Quebec, even in areas a safe distance from the Ottawa area. However, Canada's inefficient number allocation system (see below) and the proliferation of cell phones brought 819 to the brink of exhaustion by the turn of the century. The only available numbers in 819 were numbers that could have theoretically been used in the former Hull, but could not be issued without breaking seven-digit dialing between Ottawa and Hull. The scheme was largely ended in 2006. The sole legacy of the old system is a "dual dialability" system for federal government numbers on both sides of the provincial border; all federal government offices on the Quebec side duplicated several exchanges worth of their counterparts on the Ontario side.
Urban sprawl accelerated the rate of expansion of metropolitan areas, and multiple split plans have caused the geographical area of a given area code in those regions to shrink, except in countries which assign shorter area codes and longer local numbers in areas with high population densities. The rapid growth in popularity of electronic devices (first pagers, then mobile phones), in addition to regular landline growth, increased demand for new phone numbers even more. Although landline growth has sharply dropped and even decreased, largely due to the elimination of residential landlines (in favor of personal mobile phones), it has been replaced by the even-worse problem of data-only devices (hotspots, modems, netbooks, and especially popular tablets), which still require a telephone number for use on cellular networks despite being unable to make or receive regular calls.
The rise in popularity of these mobile devices has added to the pressure against split plans, as an area-code change affecting the exchange in which a cellphone is based not only forces customers to reprogram their phones, but requires the wireless carrier to reassign the number of every device based in those areas. While phones with a SIM card have their own mobile device number updated automatically, there is still the inconvenience of users having to update their contact lists for local family or others that have had their numbers changed too.
Most overlay plans introduced the inconvenience of mandatory ten-digit dialing, in which the area code must always be included even when dialing local calls. Ten-digit dialing is not a technically necessary requirement — 917 was initially deployed without it — but a U.S. Federal Communications Commission (FCC) mandate instituted it at the demand of major telephone companies, to whom an overlay is considered a disadvantage to competitors. In Canada, ten-digit dialing is also a requirement of the Canadian Radio-television and Telecommunications Commission in overlay area codes.
Overlays initially were met with resistance, as they resulted in different area codes within the same geographic area. In many cases, such as 847 in northwestern Chicago and 212 in New York City, an overlay was an additional disruption to a community which had already been subject to one or multiple code splits, encountering pushback from state regulators or consumer groups. However, eventually overlay plans were used much more widely in some areas than others. For example, the northern third of Ohio is covered by two large overlay complexes, as is northern Georgia. Connecticut, Illinois, Oregon, New Jersey, Massachusetts, Maryland, Pennsylvania, Texas, and, more recently, California have also implemented many overlays. There have been no area code splits since 2007 with area code 575 splitting off 505 in New Mexico, and there are no splits currently proposed (but many overlays). Seven-digit dialing has been broken in most area codes serving major cities; among the few cities where seven-digit dialing is still possible are Detroit, El Paso, Jacksonville, FL, Louisville, Memphis, Milwaukee, Oklahoma City, Phoenix, San Antonio and Seattle. Even in those cities, seven-digit dialing may only be possible within the area code that serves the city itself, and not outlying areas with different area codes.
Telecommunications companies have increasingly favored overlays even in sparsely populated rural areas where ten-digit local numbers are unnecessary, as split plans force cellular providers to reprogram millions of client handsets to reflect changes in existing mobile numbers. Customers also incur costs to publish new letterhead and reprogram stored address book data on individual devices. They have become even more popular as the proliferation of cell phones has caused area codes to exhaust fairly quickly. This is especially the case in area codes that have been pushed back to the brink of exhaustion after being recently split, as carriers want to keep their customers from having to change their numbers for the second time in a decade or less.
Overlay plans also favor incumbent wireline carriers over new entrants, as the established firm will already have large allocations of numbers in the more desirable existing code while subscribers of new/growing competing carriers are relegated to unfamiliar, new codes.
The first example of an entire state previously only served by a single code being overlaid was in West Virginia, which had been served with area code 304 since the inception of the North American Numbering Plan. At first, state officials voted to split off northern West Virginia with area code 681, while leaving southern West Virginia in 304. However, lobbying by the telecommunications industry led the state to reverse the decision and turn 681 into an overlay. Idaho followed this precedent in 2017, overlaying area code 208 with 986.
Overlays gained popularity among Canadian telephone companies in the early 2000s, primarily as a workaround for the country's inefficient number allocation system. Every competing carrier is issued blocks of 10,000 numbers, the maximum for each corresponding three-digit prefix, in each rate center in which it offers new service and each local interconnection region in which it ports existing numbers. While most rate centers in Canada do not need nearly that many numbers to adequately service customers, a number cannot be reassigned elsewhere once assigned to a carrier and rate center. This resulted in a large amount of unallocated numbers. The proliferation of cell phones, fax machines, pagers and dial-up Internet connections, particularly in larger markets, exacerbated this. Partly due to these factors, the numbering plan areas corresponding to four of the five largest Canadian markets (416 in Toronto, 514 in Montreal, 604 in Vancouver, and 403 in Calgary) were split in the 1990s.
The number allocation problem manifested itself at the turn of the century in Canada's largest rate center, Metro Toronto. The area code for Metro Toronto, 416, was on the verge of exhaustion only five years after the suburbs split off as area code 905 in 1993. While American cities such as New York City, Chicago, and Los Angeles had been split between two area codes, this solution was quickly ruled out for Toronto because of the area's extremely dense population and the lack of a suitable boundary for a split. It was ultimately decided to overlay 416 with area code 647 in 2001, two years after Metro Toronto was merged into the "megacity" of Toronto. The successful implementation of 647 triggered the rapid adoption of overlays across Canada. By 2013, seven-digit dialing had been eliminated in every Canadian numbering plan area except in the country's three Arctic territories (area code 867), a large but sparsely populated area in northwestern Ontario (area code 807), New Brunswick (area code 506), and Newfoundland and Labrador (area code 709). Overlays are the preferred method of expansion in Canada today; no numbering plan areas have been split in the country since 1999.
Types of overlays
The North American Numbering Plan Administration recognizes different forms of overlays:
- Distributed overlay (or all-services overlay): an entire existing area gains another area code serving the entire area. Most overlays are of this kind.
- Single concentrated overlay: only the high-growth portion of an existing area gains a second area code.
- Multiple concentrated overlay: the entire existing area gains multiple additional area codes, each of which serves a different subsection of the original. There are no known examples of such being implemented in the NANPA.
- Multiple-area distributed overlay: two or more area codes gain a single new area code covering such an area. Examples include 872 in Chicago, Illinois (over 312 and 773) and 587 in Alberta (over 403 and 780).
- Boundary-extension overlay: a neighboring area code (either an overlay code or single primary area code) is expanded to serve the area as well. Examples include 321 over 407 in central Florida and 778 over 250 in British Columbia. In 1999 281 was the first to do so, unifying with 713 in Houston; later that year 972 unified with 214; followed by 323 unifying with 213 in L.A. in 2017.
- Service-specific overlay: the first overlay area code in the NANPA, 917, is the only example of this. It was originally established as an area code specifically for cell phones and pagers in New York City, but soon after, the FCC said area codes going forth could not be service-specific, but they allowed 917 to remain as such. However, 917 is being used for landlines in New York City on a limited basis.
Number pool management
The persistent unpopularity of new area code creation, whether by split or overlay plans, led to a change in the rules of number block allocation, in order to conserve the pool of available telephone numbers. This change, which allowed for the assignment of smaller number blocks, is commonly known as number pooling. This has noticeably slowed the need for area code growth. For example, the western half of Washington, including Seattle, narrowly avoided the need for an overlay in 2001. Area code 564, originally planned for introduction in October 2001, was canceled in August 2001 after state regulators determined that the use of number pooling had allowed existing numbers in western Washington to be used more efficiently.
Number pooling is not practiced in Canada. As previously mentioned, every competing carrier is issued blocks of 10,000 numbers for every rate center where it offers service, regardless of their actual subscriber count. Individual rate centers exist even in the smallest hamlets, and even tiny unincorporated villages receive multiple blocks of 10,000 numbers. Larger cities, particularly "megacities" created through amalgamations in the 1990s and early 2000s, have multiple rate centers which were not combined for years, if at all. For example, Mississauga, Canada's sixth-largest city, is split between five rate centers even though it has been a single municipality since 1974. Hamilton, the nation's 10th-largest city, is split between nine rate centers, while Ottawa is split between 11. Overlays became the preferred relief solution in Canada in part because it is not possible to reassign a number from a smaller rate center to a larger one, even when the smaller rate center has enough numbers to serve it. As mentioned above, by 2013 seven-digit dialling had been eliminated in all eight of Canada's original numbering plan areas.
- List of area code overlays
- Interexchange carrier
- Telephone exchange
- Telephone numbering plan
- Exhaust date