III. California's Innovative Number Conservation Measures Have Made More Numbers Available to All Carriers
The FCC has exclusive jurisdiction over numbering in the United States. Only by the FCC's delegation of authority can states implement number conservation policies. Recognizing the substantial social and economic burdens associated with constant area code changes, in April 1999 the Commission petitioned the FCC for the delegated authority to implement specific telephone number conservation measures in California in order to slow down unnecessary area code proliferation. The FCC granted the Commission's request in September 1999.12
In 2000, working with the North American Numbering Plan Administration (NANPA),13 the Commission immediately took steps to implement its delegated authority to conserve telephone numbers. Beginning in March 2000, the Commission adopted various number reporting and conservation measures which collectively have significantly slowed the pace of area code splits in California.
The number conservation measures that the Commission has adopted, including requirements for carriers to return unused codes, to use numbers sequentially and to implement thousand-block number pooling for local number portability-capable carriers, all insured that the unused numbers in the 310 area code identified in the TD Report are allocated as efficiently as possible
In exercising its delegated authority from the FCC, the Commission found that industry claims of impending telephone number exhaustion were based merely upon carriers' forecasts of future telephone number usage within each area code, not on their respective historical or actual use of telephone numbers. In essence, marketing predictions, not actual number use, formed the basis of each carrier's forecast number requirements - and the national numbering policy. Now California considers new area codes based on actual need or new numbers, not on carriers' unaudited forecast demand.
Second, under California's delegated authority, new telephone numbers are allocated to carriers more efficiently. By far the most effective number conservation tool is number pooling. Number pooling allows telephone companies to receive numbers in smaller blocks than the traditional 10,000 numbers, enabling multiple providers to share a 10,000-number block and therefore use this limited resource much more efficiently. Since launching the state's first number pool in the 310 area code in March 2000, every area code in California today has implemented number pooling, overseen by a neutral third-party Pooling Administrator. Through distribution of numbers in smaller blocks of 1,000, we can better match the numbering needs of telephone companies without stranding the remaining numbers in the 10,000-number block.
The technology that enables the network to support the assignment of smaller blocks is referred to as Local Number Portability, or LNP. LNP was originally mandated in 1996 by the FCC as a means to enable customers to retain their telephone numbers when they switch telephone service to another local telephone company. This same technology is utilized for number pooling. The FCC required all wireline14 carriers to become LNP-capable by the end of 1998 in the top 100 Metropolitan Statistical Areas (MSAs) in the country.15 Without LNP, a customer is inhibited from changing carriers because he or she must change telephone numbers.16
Though LNP technology has existed for several years and the wireline carriers became LNP-capable by the end of 1998, the FCC granted cellular and PCS companies three separate extensions of time, until November 2003, to become LNP-capable.17 The FCC further gave paging companies a permanent exemption from the LNP requirement. Until November 2002, only wireline carriers could participate in number pooling, and those carriers at that time received telephone numbers solely through the number pool; wireless carriers received numbers in 10,000-number blocks through a Commission-administered monthly rationing system, or "lottery," and through emergency requests to the Commission. Currently, both wireline and wireless carriers in California now receive numbers through the state's number pools. Only paging companies, which are still exempt from LNP requirements, receive numbers through the monthly lottery.
California also requires companies to more efficiently manage the numbers they already have had assigned to them but which are not yet assigned to customers. These rules include requiring companies to return any 10,000-number or 1,000-number block that the telephone company has held for more than six months without using it; requiring telephone companies to show they will be out of telephone numbers within six months before a carrier's request for additional numbers can be granted; and requiring telephone companies to show they have used at least 75% of the numbers they hold before they can request additional numbers (known as the "fill rate requirement"). Companies must assign numbers in thousand-block sequence (called "sequential numbering"), moving to the next thousand-block only after using 100% of their numbers. Indeed, since the Commission extended the 100% use requirement in all California area codes, the demand for 10,000-number blocks has declined. Only two NXX codes have been opened since the start of wireless pooling in November 2002 with one of those codes having been returned.
Fourth, as an additional measure to extend the life of the 310 area code, the Commission filed a petition with the FCC on September 5, 2002,18 seeking a waiver from the FCC's "contamination" (or number use) threshold requirement. Specifically, the Commission requested that the FCC grant California the authority to increase the existing 10% "contamination" rate. Under FCC rules, carriers must donate to each area code's common number pool all thousand-blocks of telephone numbers that contain less than 10% "contaminated," or used, numbers. An increased level of allowable contamination or usage rates for poolable thousand-number blocks (from current 10% to 25%) increases the number of thousand-blocks that are available to all carriers through each area code's number pool. By increasing the number of available thousand-blocks to the pool, the life of the 310 area code is extended by maximizing the amount of telephone numbers that are available to all carriers.
The FCC acted upon this Petition by its order 03-196 adopted August 5, 2003 and released August 11, 2003. While the FCC declined to grant a statewide waiver of the 10% contamination rate, it did find good cause to justify raising the contamination level in the 310 and 909 area codes. The Commission directed carriers to comply with the new contamination rate in the 310 and 909 area codes by ruling dated August 21, 2003. In its June 2004 report to the FCC on the effectiveness of this contamination waiver, the Commission determined that this increased threshold in conjunction with inventory guidelines would extend the life of area codes in California across the board - and in particular would extend the life of the 310 area code by 21 months.
Likewise, wireless LNP after years of delay, was finally implemented by the FCC Order 96-286 in the top 100 MSAs on November 24, 2003. Using LNP technology allows consumers to "port" or carry with them their existing phone numbers when they switch telephone providers. This new option imposes fewer burdens on consumers and helps to minimize the demand by carriers to assign new telephone numbers.
Moreover, wireless carriers which may have lower resources in certain rate centers have the flexibility to meet their customer needs by serving them from any rate center in their 310 service area. Some wireless carriers already do this using just a handful of rate centers. As a result, wireless carriers have the ability to more efficiently access resources in rate centers where there is a wealth of telephone numbers available.
The effect of these conservation measures is that a continual return of telephone numbers by carriers to the 310 number pool has resulted in the return of 413 blocks of one-thousand numbers since August 2003. In October 2003, the Commission voted not to split the 310 area code in order to take time to monitor and determine the impact of newly implemented conservation measures. Even with continual carrier assignments over the past year, the 310 pool now contains 146 one-thousand number blocks more than it did when the Commission voted not to split the 310 area code ten months ago as well as one additional NXX code which has been returned to the lottery code reserves. Thus, the 310 area code contains more telephone numbers in 2004 than it did in 2003 in both its number pool, to be shared among all carriers that need numbers, and in its reserve of unused NXX code numbers - to be available if demand surges in any particular 310 location.
12 In the Matter of California Public Utilities Commission Petition for Delegation of Additional Authority Pertaining to Area Code Relief and NXX Code Conservation Measures, Order, CC Docket No. 96-98, FCC 99-248 (FCC Order). As a condition of that delegated authority, the FCC requires this Commission to take steps to provide additional telephone numbers through an area code split or overlay if telephone numbers are in imminent danger of exhaust.
