Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SUNDAY, April 23, 1995                   TAG: 9504210089
SECTION: BUSINESS                    PAGE: F5   EDITION: METRO 
SOURCE: DAVID FOSTER ASSOCIATED PRESS
DATELINE: OLYMPIA, WASH.                                 LENGTH: Medium

NEW AREA CODES CREATE `BLACK HOLES' OF MISSED CALLS - AND LOST PROFITS

Boubel has fallen victim to a technological screw-up that soon may reach out and touch millions of Americans, including thousands in Western Virginia. He has been assigned a new area code that a lot of people cannot dial because it doesn't have 1 or 0 as its middle digit.

``Almost every one of my sales is preceded by a phone call,'' says Boubel, who designs computer software for the paper industry. ``When the phone doesn't ring and the fax doesn't ring, I'm out of business.''

By year's end, millions of phone customers in at least 11 states will have new area codes that millions of other callers won't be able to reach unless they make costly changes to their own phone systems.

The new area codes - the first that don't have 1 or 0 as the middle digit - are being implemented to meet the nation's exploding demand for phone numbers created by fax machines, cellular phones, pagers and modems.

Trouble is, many businesses and government offices have switchboards - called private branch exchanges, or PBXs - that aren't programmed to recognize such area codes.

The new codes have already been implemented in five states: 360 in western Washington, 334 in southern Alabama, 520 in Arizona, 970 in Colorado, and 281 in Houston.

The complaints are loudest in Washington and Alabama, the first states affected. They got new area codes Jan. 15, and their phase-in period, during which callers can use the old or new codes, ends next month - May 13 in Alabama, May 21 in Washington.

Businesses dependent on calls from out of state are dreading the deadlines.

``We're being thrown to the wolves,'' says Ben Hargett, president of DeVan Inspection Co., which inspects cargo in Mobile, Ala. So many customers can't reach his new 334 number that Hargett says he may have to move his business to a ``more stable area code.''

Last week in Olympia, a hearing called by state utility regulators was packed with phone customers angry about the 360 code, which covers all of western Washington outside the Seattle-Tacoma area.

PBXs were the root of most problems, but there were other complaints - long-distance carriers that hadn't reprogrammed their equipment, pay phones that didn't recognize the 360 area code.

There was also testimony about callers outside the United States not getting through to 360. Telecommunications experts, who predicted the PBX problem and know how to fix it, are at a loss to explain the trouble with international calls.

``We think the impact on the economy in western Washington is going to be horrendous,'' says Clint Morgan, an attorney for businesses suing the regional phone company, U S WEST. ``We're going to have our own little Cuba here where nobody can get a hold of us.''

The lawsuit claims U S WEST didn't do enough to tell its own customers or callers outside the region about the PBX problem. It seeks unspecified damages for lost business and an extension of the phase-in period.

U S WEST says it can't extend its deadline because western Washington's 206 area code is almost out of numbers.

``We're as frustrated as they are,'' says U S WEST spokesman George Chappell. The company repeatedly told customers in its 14-state region of the pending change, but it lacks authority to notify callers outside the region, he says.

Besides, Chappell and other industry insiders say, getting word out to managers of the nation's estimated 400,000 PBXs may not make much difference at this point.

AT&T Global Business Communications Systems, a leading PBX manufacturer, says it has been alerting its customers since 1992 to prepare for the new area codes. But only half have upgraded their systems, says AT&T spokeswoman Patricia Sieh.

A PBX can serve anywhere from 20 to 25,000 phones. Upgrading small or medium systems to handle the new area codes typically costs $850 to $6,000, and a few customers with older PBXs may have to spend up to $15,000, Sieh says. Replacing a big PBX with a whole new system can run $100,000.

``This is not a surprise for any of our customers,'' Sieh says. ``If they've decided not to upgrade, that's a conscious decision.''

For some PBX owners a bit of geographic snobbery is involved: Who wants to call western Washington or southern Alabama, anyway?

But that attitude will backfire, predicts Ken Branson, spokesman for Bellcore, the Livingston, N.J., company that administers North America's area codes.

``There will be bigger and bigger telephonic black holes to which they can't dial,'' he says. ``At some point they may want to call Los Angeles or Chicago or Miami. We're assigning 13 or 14 of these new area codes this year, and we'll be assigning more next year. We see no end to the trend.''