I think at one point it was a value-added service, and you had to pay extra on your phone bill to enable it, but once it was enabled you could turn it on or off at will.
When I was a teenager (in the 1990s), our house had three phone lines. One was for voice calls, and it had call waiting turned on permanently. Another was for modems (first BBSes, then dial-up Internet), and had call waiting turned off permanently. A third was paid for by my Dad's employer, he used it for work calls, work faxes, and call up his work's modem bank to send/receive email, I don't know what he did with call waiting settings.
My Dad ordered three phone lines, but only had two pairs running in to the house. So they ran another cable, which I think had 12 pairs in it, but only three were ever connected. My Dad was smiling about how future-proof they made it. Nowadays, only one of those pairs is still active, and I expect within the next 1-2 years that pair will be turned off too. Analog POTS phone system being phased out in favour of VoIP (the Internet comes into the house over coax, not copper pair.)
As was Caller ID, Three Way Calling, Busy Number Redial, etc.
It's amazing how much incumbent telcos nickled and dimed little features like this. I think it was a couple bucks a month to have that feature.