[Federal Register: March 21, 2003 (Volume 68, Number 55)]
[Rules and Regulations]
[Page 13850-13855]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr21mr03-13]
-----------------------------------------------------------------------
FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 76
[CS Docket No. 95-184, MM 92-260; FCC 03-9]
RIN 4105
Telecommunications Services Inside Wiring Customer Premises
Equipment
AGENCY: Federal Communications Commission.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This document revises rules which the Commission adopted
relating to cable home run wiring. This document also resolves issues
raised by the Commission regarding exclusive and perpetual contracts
and related matters.
DATES: Effective May 20, 2003 except for Sec. Sec. 76.620, 76.802, and
76.804 which contain information collection requirements that have not
been approved by OMB. The Federal Communications Commission will
publish a document in the Federal Register announcing the effective
date for the modifications to these sections. Written comments by the
public on the new and/or modified information collection(s) are due May
20, 2003.
FOR FURTHER INFORMATION CONTACT: Cheryl Kornegay, Media Bureau at (202)
418-7200 or via Internet at ckornega@fcc.gov; or Wanda Hardy, Media
Bureau, (202) 418-2129. For additional information concerning the
information collections contained in this document, contact Les Smith
at (202) 418-0217, or via the Internet at lesmith@fcc.gov. In addition
to filing comments with the Office of the Secretary, a copy of any
comments on the information collection(s) contained herein should be
submitted to Les Smith, Federal Communications Commission, Room 1-A804,
445 12th Street, Washington, DC 20554 or via the Internet to
lesmith@fcc.gov.
SUPPLEMENTARY INFORMATION: This document is a summary of the
Commission's First Order on Reconsideration and Second Report and Order
(``Order'' and ``2nd R&O''); CS 95-184, MM 92-260, FCC 03-9, adopted
January 21, 2003 and released January 29, 2003. This document revises
rules which the Commission adopted in the Report and Order and Second
Further Notice of Proposed Rulemaking; 62 FR 61016, November 14, 1997,
(``R&O'' and ``2nd FNPRM''); concerning cable home run wiring. The
rules adopted by the Commission established specific procedural
mechanisms requiring the sale, removal or abandonment of home run
wiring in multiple dwelling unit buildings. This document addresses the
eight petitions for reconsideration and ten oppositions or responses to
the petitions for reconsideration received by the Commission in
response to the Report and Order. This document also resolves issues
raised by the Commission in the 2nd FNPRM relating to (1) exclusive and
perpetual contracts; (2) the application of cable home wiring and
subscriber termination rights to non-cable and cable MVPDs; (3) the
exemption of small MVPDs from the annual signal leakage requirements;
and (4) a proposal to establish a virtual demarcation point from which
alternative providers could share cable wiring. The full text of this
decision is available for inspection and copying during normal business
hours in the FCC Reference Information Center, Portals II, 445 12th
Street, SW., Room CY-A257, Washington, DC 20554, and may be purchased
from the Commission's copy contractor, Qualex International, Portals
II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554, telephone
(202) 863-2893, facsimile (202) 863-2898, or via e-mail
qualexint@aol.com or may be viewed via Internet at http://www.fcc.gov/
http://www.fcc.gov/
mb/.
Paperwork Reduction Act: This Order contains new or modified
information collection(s). The Commission, as part of its continuing
effort to reduce paperwork burdens, invites the general public to
comment on the information collection(s) contained in this Order and
required by the Paperwork Reduction Act of 1995, Pub. L. 104-13. Public
and agency comments are due May 20, 2003.
Synopsis of First Order on Reconsideration
Legal Authority of the Commission
1. Several petitioners questioned the Commission's authority to
regulate the disposition of cable home run wiring in the first
instance. We considered these arguments at length previously in the R&O
and concluded that the Commission has authority under section 4(i) and
303(r) of the Communications Act of 1934 (``Communications Act''), in
conjunction with the pervasive regulatory authority committed to the
Commission under Title VI, and particularly section 623, to establish
procedures for the disposition of MDU home run wiring upon termination
of service.
Application of Building-by-Building Disposition Procedures
2. The R&O adopted procedures for two categories of home run wiring
disposition: building-by-building and unit-by-unit. A multiple dwelling
unit (``MDU'') owner may invoke the building-by-building disposition
procedures when the incumbent multichannel video programming
distributors (``MVPD'') owns the home run wiring, but no longer has a
legally enforceable right to remain in the building and the MDU owner
wants to use that wiring for service from another provider. A MDU owner
may invoke the unit-by-unit disposition procedures when the incumbent
MVPD owns the
[[Page 13851]]
home run wiring, but no longer has a legally enforceable right to
maintain its home run wiring dedicated to a particular unit or units,
and the MDU owner wants to permit multiple service providers to compete
to serve individual units in the building and to use the existing
wiring.
3. At least one petitioner suggested that the Commission's home run
wiring disposition procedures should only apply where an MDU owner
agrees to allow unit-by-unit competition and not where the owner seeks
to contract with a new MVPD to serve the entire building. As we
concluded in the R&O, this proposal wrongly assumes that any MVPD that
serves the entire building has the ability to act like an entrenched
monopolist, without regard to the quality and quantity of the video
service provided. We observed in the R&O that MVPDs competing for the
right to serve the building will have to offer the mix of video
service, quality, quantity and price that will best help the MDU owner
compete in the marketplace.
Control of Home Run Wiring
4. Both the building-by-building and unit-by-unit home run wiring
disposition procedures allow the MDU owner, rather than individual
subscribers, the option to acquire the home run wiring of a departing
MVPD. In the R&O the Commission addressed comments from at least six
other parties contending that MDU owners do not act in the best
interest of residents and therefore should not have the authority to
choose among service providers. The Commission concluded in the R&O
that many MDU owners are tenant-based condominium associations and
cooperative boards that cannot be presumed to be non-representative of
their tenant's interests. The Commission also concluded that the
property owner should have the ability to control the wiring because
the property owner is responsible for the common areas of a building.
The Commission noted that property owners have safety and security
responsibilities, maintain compliance with building and electrical
codes, maintain the aesthetics of the building, and balance the
concerns of the residents. The Commission concludes in the Order that
considerations of fairness and efficiency persuade it to leave the
rules addressing control of home run wiring rules intact.
Removal of Wiring by Incumbent Providers
5. Several petitioners asked the Commission either to eliminate
entirely an incumbent operator's option to remove its home run wiring
or to qualify that option by requiring the incumbent to first offer to
sell the wiring to the MDU owner or an alternative MVPD at replacement
cost or salvage value. The Commission concludes in the R&O that the
record in this proceeding reveals almost no concrete examples of
incumbents removing their wiring rather than abandoning or selling it.
The Commission is not inclined to make a decision to qualify or
eliminate an incumbent's right to remove its property without a
compelling record of the need to do so. Also, because the record
contains no concrete examples of incumbent operators engaging in
pricing activities that the negotiation and arbitration process cannot
accommodate, the Commission declined to require an incumbent that
elects to sell its home run wiring to do so at replacement cost or
salvage value.
Arbitration/Independent Pricing Experts
6. A petitioner asked the Commission to require MDU owners to agree
to purchase the home run wiring at a price set through binding
arbitration as a precondition to entering into negotiations with the
incumbent regarding the sale price of the wiring. The record provides
no evidence that MDUs have not or would not bargain in good faith under
the current rules. We question whether a commitment by the parties to
engage in binding arbitration prior to the onset of negotiations will
improve the chances for successful negotiations. Instead such a
requirement could act as a disincentive for MDU owners to invoke the
inside wiring rules. We will not adopt the petitioner's proposal to
impose upon the MDU owner an obligation to purchase home run wiring
once an incumbent has elected to sell it.
MDU Owner Compensation
7. Several petitioners argue that MDU owner decisions are
improperly influenced by the level of consideration offered by an MVPD
to the MDU owner, rather than by which MVPD offers the widest array of
programming, most attractive prices, or best customer service. These
petitioners contend that the Commission's home run wiring disposition
rules should not apply in any situation where the owner has received
any form of excess. As we determined in the R&O, the petitioners have
not suggested definitions or guidelines as to what they consider
``excessive'' and have produced no evidence that such payments have
resulted in competitive harm. We are unable to conclude that such
payments are anti-competitive and warrant exclusion of MDU owners who
accept them from the protection of the inside wiring rules.
Notice Period and Transition Period for the Unit-by-Unit Disposition
Procedures
8. In the R&O the Commission recognized that MDU owners may permit
service providers to compete head-to-head in a building for the right
to use the individual home run wires dedicated to each unit in an MDU.
Our unit-by-unit disposition procedures apply when the incumbent
service provider does not have (or will not have at the conclusion of
the notice period) the right to maintain its home run wiring dedicated
to a particular unit in an MDU. If the MDU owner wishes to permit
alternative MVPDs to compete for the right to use the individual home
run wires dedicated to each unit, the MDU owner must give the incumbent
60 days written notice that it intends to invoke the home run wiring
procedures. The incumbent will then have, with respect to all of the
incumbent's home run wiring in the MDU, 30 days to elect to remove,
abandon or sell the wiring dedicated to individual subscribers who may
subsequently choose the alternative MVPD's service. Several petitioners
argued that the 60-day notice period is inordinately long. They suggest
that the notice period will discourage vigorous unit-by-unit
competition by allowing incumbents time to develop a competitive
counterattack in response to the arrival of an alternative MVPD, to
reprice or restructure their service offerings and to lock individual
subscribers into long-term service contracts.
9. On reconsideration, we are not convinced that a notice period
for unit-by-unit transitions of less than 60 days would allow enough
time to facilitate a smooth and timely transition when an alternative
provider enters a building. The procedures adopted in the R&O are
intended to provide all parties sufficient notice and certainty
regarding how existing home run wiring will be made available to the
alternative MVPD so that a change in service can be made efficiently.
While a 60 day notice period may provide an opportunity for the
incumbent to organize a competitive response to the alternative
provider's service offering, we have no reason to believe the incumbent
will necessarily have a market advantage over the alternative provider.
The incumbent has an existing relationship with its subscribers, but
that relationship may not be a positive one. Where subscribers are
eager to obtain the services of an alternative provider, due in part to
the failings of the incumbent, the existing relationship may hurt
rather than help
[[Page 13852]]
the incumbent. Where subscribers are more than satisfied with the
service provided by the incumbent, that existing relationship should
help the incumbent in its efforts to retain subscribers to retain
subscribers in the face of an alternative provider's competitive
efforts. Beyond the fact of an existing relationship, an alternative
provider possesses many of the same competitive tools available to the
incumbent, such as pricing and designing service offering attractively
and attempting to induce subscribers to enter into long term contracts.
We decline to shorten the notice period.
10. A petitioner suggests that in cases where the incumbent has
elected to sell or abandon its home run wire, our rules should be
modified to eliminate an existing ambiguity with respect to when the
incumbent provider will make the home run wiring accessible to the
alternative provider. The current rule provides that such access will
be provided to the alternative provider ``within 24 hours of actual
service termination.''
11. We agree that the requirement as it is presently written is
ambiguous. Accordingly, we will amend Sec. 76.804 of our rules to
provide that where the MDU owner or the alternative provider chooses to
purchase the home run wiring, the incumbent must provide access during
the 24-hour period prior to actual service termination to enable the
new provider to avoid a break in service.
Unauthorized Transfer of Customers
12. A petitioner urges the Commission to amend its home run wiring
rules to include an express prohibition against unauthorized customer
transfers. Another petitioner contends that such rule modifications are
not necessary because MVPD service does not present the same
opportunities for ``slamming'' or the unauthorized transfer of
customers, as telephone service transfers. The Commission is not aware
of any unauthorized transfer complaints filed within the more than four
years that the home run wiring disposition rules have been in effect.
Absent such complaints, we find no basis for modifying our rules.
Mandatory Access
13. Mandatory access laws generally provide franchised cable
operators with a legal right to install and maintain cable wiring in
MDU buildings, even over MDU owners' objections. Mandatory access
statutes were generally enacted to ensure that MDU tenants would have
cable programming service and to prevent MDU owners from denying access
based on aesthetic or other considerations.
14. We continue to believe that mandatory access laws may impede
competition in the MDU marketplace and that they tend to preclude
alternative (non-cable) MVPDs from executing MDU contracts. This is due
to the fact that most mandatory access laws give the franchised cable
operator a legal right to wire and remain in an MDU. The predictable
result is that competitive providers are less likely to take the
financial risk of entering, or to secure the necessary financial
backing to enter the MDU marketplace in a mandatory access state. While
we recognize the negative impact that mandatory access statues can
have, we cannot ignore the possibility that, but for the existence of
mandatory access statutes, some MDU owners would refuse to allow their
buildings to be wired for cable programming. Federal preemption of
mandatory access laws could, conceivably, leave some MDU tenants
without access to non-broadcast video programming altogether. We will
retain our conclusion in the R&O that we can not support federal
preemption of state mandatory access rules at this time.
Signal Leakage
15. In the R&O, the Commission adopted a rule extending the signal
leakage requirements to MVPD providers other than cable systems,
including telephone companies and other telecommunications service
providers that deliver video service. The Commission granted a five-
year exemption from these requirements, however, for non-cable MVPDS
that were ``substantially built'' as of January 1, 1998, in order to
allow those MVPDs sufficient time to bring themselves into compliance.
``Substantially built'' was defined as having 75% of the distribution
plant completed.
16. A petitioner suggested that we adopt a rule providing that a
wireless cable system is ``substantially built,'' for purposes of the
five year exemption form our signal leakage testing and reporting
requirements, when its headend/transmitter facilities are constructed
and operational. We reject this proposal. We note that the headend and
transmitter of a wireless cable plant do not constitute distribution
plant. The receiver and down-converter and associated cable strand,
amplifiers, etc., constitute distribution plant subject to signal
leakage. It is the deployment of such equipment that is relevant for
purposes of the exemption.
Sharing of Molding
17. In the R&O, the Commission adopted a rule permitting an
alternative MVPD to install its wiring within an incumbent cable
operator's existing molding, even over the incumbent's objection, where
the MDU owner agrees that there is adequate space in the molding and
the MDU owner gives its affirmative consent.
18. A petitioner argues that our rule effects an unconstitutional
taking of private property where an incumbent provider owns the molding
or has contracted with the MDU owner for the exclusive right to occupy
the moldings or conduits. The Commission's rule does not apply where
the incumbent has an exclusive contractual right to occupy the molding
or where the incumbent has contracted for the right to maintain its
molding on the MDU property without alteration by the MDU owner.
Accordingly, our rule does not interfere with the incumbent's property
rights and does not constitute a taking, and, therefore, no
compensation need be paid.
MDU Demarcation Point
19. Our rules prohibit an incumbent MVPD from interfering with a
competitor's access to existing MDU wiring at the demarcation point.
The demarcation point for MDU installations is defined as ``a point at
(or about) twelve inches outside of where the cable wire enters the
subscriber's dwelling unit, or where the wire is physically
inaccessible at such point, the closest practicable point thereto that
does not require access to the individual subscriber's dwelling unit. A
location is ``physically inaccessible'' when accessing the wire at that
point ``would require significant modification of, or significant
damage to, preexisting structural elements, and would add significantly
to the physical difficulty and/or cost of accessing the subscriber's
home wiring. The rule provides examples of wiring that is ``physically
inaccessible,'' such as ``wiring embedded in brick, metal conduit or
cinder blocks with limited or without access openings.''
20. In the R&O, the Commission considered and rejected various
proposals to relocate the demarcation point. Location of the
demarcation point is significant because, under our rules, the
demarcation point is the place where competing providers may access
existing home wiring in an MDU building. A demarcation point that
allows relatively unimpeded access to existing wire is likely to foster
[[Page 13853]]
competitive entry into the MDU marketplace.
21. We conclude that cable wiring behind sheet rock is ``physically
inaccessible'' as that term is used in 47 CFR 76.5(mm)(4) of the
Commission's rules. As stated, our rule defines ``physically
inaccessible'' as ``require[ing] significant modification of, or
significant damage to, preexisting structural elements.'' We believe
that the term ``structural elements'' encompasses sheet rock, otherwise
known as wallboard. The ``Note'' appended to Sec. 76.5(mm)(4), which
helps define ``inaccessibility,'' states that ``wiring embedded in
brick, metal conduit or under cinder blocks with limited or without
access openings would likely be physically inaccessible; wiring within
hallway molding would not.'' Sheet rock and other similar materials are
not identified specifically. In our view, sheet rock is more like
``brick or cinder block,'' materials also commonly used to form
ceilings and hallways, than molding, which is not.
22. The definition of ``physically inaccessible'' also requires
that accessing the wiring at that point would ``add significantly to
the physical difficulty and/or cost'' of connecting. While we
acknowledge that cutting a hole through and repairing sheet rock is
neither as physically difficult nor as costly as boring through brick,
metal or cinder block, we are satisfied that it adds significantly to
the physical difficulty and cost of wiring an MDU. For this reason we
conclude that wiring that is hidden behind the sheet rock in an MDU
wall or ceiling is ``physically inaccessible'' as the term is used in
the Commission's rule. We will amend the ``Note'' appended to Sec.
76.5(mm)(4) to include sheet rock.
Open Video System Providers
23. In the 1996 Act, Congress recognized the open video system
(OVS) as a means by which a local exchange carrier may provide cable
service to subscribers within its telephone service area. Although
subject to streamlined regulation as compared to their cable
counterparts, OVS operators have clearly defined obligations and
responsibilities, such as offering up to two-thirds of their channel
capacity to unaffiliated programmers on a non-discriminatory basis.
24. A petitioner argues that OVS operators should not be able to
avail themselves of the home run wiring rules because OVS operators
have no basis to claim a right to use pre-existing MDU home run wiring.
The petitioner submits that OVS operators are legally required to
construct end-to-end facilities all the way to end user MDU residents.
OVS operators, the petitioner concludes, have an obligation to
construct end-to-end facilities to the demarcation point of each
subscriber residence and MDU unit within its service area. Yet the
statute prohibits an OVS operator provider from consuming all capacity
with affiliated programming, and whether the OVS operator acquires
existing home run wiring in an MDU or installs the wiring itself is
irrelevant to the question of statutory compliance.
25. It is not clear how an OVS operator's obligation to carry
affiliated and nonaffiliated programming on a non-discriminatory basis
would interfere with the operator's eligibility to avail itself of the
home run wiring rules. The petitioner assumes an OVS provider will
consume all capacity with affiliated programming, and that, in some
way, a requirement that OVS operators must install new home wiring in
MDUs will prevent that from happening. Yet the statute prohibits an OVS
provider from consuming all capacity with affiliated programming, and
whether the OVS operator acquires existing home run wiring in an MDU or
installs the wiring itself is irrelevant to the question of statutory
compliance.
Synopsis of Second Report and Order
Background
1. In the R&O, the Commission amended its cable television inside
wiring rules for the purpose of facilitating competition in video
distribution markets. The new rules were intended to foster
opportunities for multichannel video programming distributors
(``MVPDs'') to provide service in multiple dwelling units (``MDU'') by
establishing procedures regarding how and under what circumstances the
existing cable home run wiring would be made available to alternative
service providers.
2. In the 2nd R&O; the Commission declined to restrict exclusive
contracts for the provision of video services in multiple dwelling unit
buildings (``MDU''). The Commission also declined to ban perpetual
contracts for the provision of video services in MDUs or subject such
contracts to a fresh look window. The Commission concluded that the
cable home wiring and cable home run wiring rules should apply to all
multichannel video programming distributors (``MVPDs'') in the same
manner that they currently apply to cable operators. The Commission
adopted a limited exemption for small non-cable MVPDs from its signal
leakage reporting requirements but declined to allow MDU owners to
require sharing of incumbent-owned cable wiring.
Exclusive and Perpetual MDU Contracts
3. Exclusive and perpetual contracts between MDU owners and MVPDs
grant incumbent MVPDs the legal right to remain on MDU properties and
thus limit application of the Commission's inside wiring rules.
Exclusive contracts generally refer to those contracts that specify
that, for a designated term, only a particular MVPD and no other
provider may provide video programming and related services to
residents of an MDU. Perpetual contracts generally refer to those
contracts that grant the incumbent provider the right to maintain its
wiring and provide service to the MDU for indefinite or very long
periods of time, or for the duration of the cable franchise term, and
any extensions thereof.
4. Commenters noted that most long-term exclusive and perpetual MDU
contracts were executed at a time when local competition for the
provision of multi-channel video programming was scarce or non-
existent. As the Commission has observed, recent advancements in video
and communications technology have contributed toward a more dynamic,
evolving marketplace with cable and new alternative providers competing
for MDU subscribers. It appears that some property owners who might now
prefer to choose other providers' services may be bound by exclusive or
perpetual contracts.
5. In the 2nd FNPRM, the Commission recognized that exclusive
contracts for video services in MDUs may have competitive consequences.
Exclusive contracts could bar alternative MVPDs access to, and thus
inhibit competition for MDUs. The Commission also noted arguments that
exclusive contracts enable alternative providers to recoup the
investment required to enter MDUs and thus to become or remain viable.
The Commission asked commenters to address whether it would be
appropriate to cap exclusive contracts to open up MDUs to potential
competition on a building-wide or unit-to-unit basis, and if so, what
would represent a reasonable cap.
6. Commenters identified with real estate interests, private cable
operators and some telecommunications entities tend to support
exclusive contracts for video programming services as enabling
alternative MVPDs to gain a foothold in the MDU market. These
commenters generally advocated long-term or no caps on exclusive
contracts. Other commenters were critical of exclusive
[[Page 13854]]
contracts and proposed, if they were to be permitted at all, very short
caps of three to five years.
7. We find that the record does not support a prohibition on
exclusive contracts for video services in MDUs, nor a time limit, in
the nature of a cap, for such contracts. The parties have identified
both pro-competitive and anti-competitive aspects of exclusive
contracts. We cannot state, based on the record that exclusive
contracts are predominantly anti-competitive. With respect to capping
such contracts, there appears to be little agreement over the length of
the term. Again, based on the record, we cannot discern the ``correct''
length. We note that competition in MDU market is improving, even with
the existence of exclusive contracts.
Perpetual Contracts
8. The 2nd FNPRM also sought comment regarding whether it would be
appropriate to restrict perpetual contracts between MDU owners and
MVPDs. Although several commenters question the Commission's authority
to act in this area, most commenters addressing the issue assert that
perpetual contracts effectively bar alternative and/or new MVPDs entry
into the MDU market and are inherently anti-competitive. Nonetheless,
the record does not demonstrate the existence of widespread perpetual
contracts nor support the need for government interference at this
time.
9. The majority of commenters that urged the Commission to restrict
perpetual MDU contracts offered only conclusory statements regarding
the prevalence of such contracts in the marketplace. One commenter
submitted the results of a survey in which it solicited responses from
a cross section of MDU owners on issues relating to perpetual
contracts. The survey suggests that only a small percentage of MDUs are
currently subject to perpetual contracts for video programming
services.
10. Given the results of the survey and the lack of other data
reflecting the prevalence of perpetual contracts, we cannot conclude
that such contracts represent a barrier to competition in the MDU
market. Accordingly, we do not find that the current record provides a
basis for restricting perpetual contracts.
Application of Cable Inside Wiring to All MVPDs
11. In the 2nd FNPRM, the Commission proposed to modify its rules
governing home wiring for single-unit installations and subscribers'
pre-termination rights, so that they would apply to non-cable MVPDs, in
addition to cable MVPDs. The Commission suggested that such
modifications ``would promote competitive parity and facilitate the
ability of a subscriber whose premises was initially wired by a non-
cable MVPD to change providers.'' The Commission opined that the
modifications would ``promote the same consumer benefits as in the
cable context: Increased competition and consumer choice, lower prices
and greater technological innovation. The Commission sought comment on
the proposal to extend its rules to all MVPDs and on its authority to
do so.
12. The trend in recent years has been increased competition in the
MVPD market. The Commission anticipates this trend to continue with
alternative MVPDs increasingly gaining market share, such that the
entity responsible for the initial installation in a home could be a
cable or a non-cable provider. We find it necessary to broaden our
rules to ensure that a subscriber's ability to terminate existing
service and accept alternative service is not contingent on whether the
wiring was installed by a cable, as opposed to a non-cable provider. We
further find that the proposed rule modifications will promote
regulatory parity and enhance competition among MVPDs. We will modify
our rules governing the disposition of home wiring and subscriber pre-
termination rights to apply uniformly to all MVPDs.
Exemption From Signal Leakage Reporting Requirements
13. In the R&O, we extended the application of our signal leakage
rules, which had applied only to traditional cable operators, to non-
cable MVPDs such as satellite master antenna service (``SMATV''), MMDS,
and open video system (``OVS'') operators. A transition period for
compliance was established for certain non-cable MVPDs. In particular,
all non-cable MVPDs were directed to comply with the reporting
requirement set forth in CFR 76.1804(g) by January 1, 2003. In the 2nd
FNPRM, we sought comment on whether we should exempt small MVPDs,
including small cable operators, from these requirements. Section
76.1804(g) of the Commission's rules requires cable operators to file
annually with the Commission certain information relating to their use
of the aeronautical radio frequency bands. We sought comments in an
effort to determine whether the annual reporting requirement may impose
undue burdens on small service providers, including small cable
operators.
14. Supporters of a reporting exemption for small MVPDs argue that
an exemption would be consistent with congressional directives to
reduce regulatory burdens on small MVPDs where feasible. They argue
that there is no evidence that a small MVPD exemption will result in
abuses of the signal leakage rules or otherwise prompt small MVPDs to
be less attentive to their signal leakage obligations. Opponents of an
exemption argue that the proposal does not relieve MVPDs of the
obligation to conduct tests and that the filing of signal leakage test
results is a simple task once the testing is complete. They state that
the signal leakage rules represent a Commission effort to protect life
and property, and, if reporting is helpful in the oversight of signal
leakage, then all MVPDs should report.
15. We will adopt a very limited exemption to the annual reporting
requirement of CFR 76.1804(g) of our rules. This exemption will apply
to non-cable MVPDs with less than 1000 subscribers or serving less than
1000 units. Such an exemption furthers congressional directives to
reduce the regulatory burden on small entities where feasible. We have
no reason to believe that such an exemption will affect enforcement of
the Commission's signal leakage rules. We are not exempting MVPDs
subject to existing reporting requirements. The annual reporting
requirement is scheduled to become effective for all non-cable MVPDs on
January 1, 2003. With this exemption, that requirement will not become
effective for the smallest non-cable MVPDs. Relief from the annual
reporting requirement will allow small non-cable MVPDs to focus on the
prevention of leaks by devoting their scarce resources primarily to
maintenance, leakage detection, and repair. The exempted systems will
continue to perform all signal leakage tests required by our rules and
must make the results of those tests available to Commission agents
upon request. We believe it is sensible to treat small cable and non-
cable MVPDs differently in this regard because of the different
environments in which each is likely to operate. Small cable systems
have wiring that connects individual residences, is strung on utility
poles, and is subject to all of the stresses associated with the
outside environment, including temperature fluctuations, wind loading,
rain and ice. Small non-cable MVPDs predominately serve MDUs and thus
have their wiring and associated electronics protected from exposure to
the weather and the risk of damage that could result in signal leakage.
16. Testing will remain an important part of our enforcement
program. It is
[[Page 13855]]
only the future obligation to report results by the smallest non-cable
MVPDs which are changing here. Our signal leakage monitoring and
enforcement program, conducted pursuant to CFR 76.613, which includes a
vigorous program of field inspections and the impositions of
forfeitures, remains unaffected. The Commission's field operations
staff conducts routine monitoring for signal leakage and, of course,
will continue to respond to aeronautical complaints to ensure the safe
operation of aeronautical frequencies.
Simultaneous Use of Cable Home Run Wiring
In the Second Further Notice, we solicited comments on whether we
should adopt a proposal from DirecTV to give MDU owners the right to
require that incumbent MVPDs allow competitors to share their home run
wiring. Most of the comments we received on this issue agree that there
are significant unresolved technical problems with the proposal,
notwithstanding its merits from a public policy perspective. Most of
the technical objections to the DirecTV proposal relate to the
possibility of interference when amplified signals are transmitted on a
single wire and the possible lack of bandwidth capacity in existing
cable plant. We are unable to resolve this issue based on the record
before us. Accordingly we decline to adopt DirecTV's line sharing
proposal at this time
Ordering Clauses
26. Pursuant to the authority granted in sections 1, 4(i), 201-205,
214-215, 220, 303, 623, 624 and 632 of the Communications Act of 1934,
as amended, 47 U.S.C. 151, 154(i), 201-205, 220, 303, 544 and 552, the
petitions for reconsideration filed in response to the R&O are granted
in part and denied in part, as provided herein.
27. Pursuant to the authority granted in sections 1, 4(i), 201-205,
214-215, 220, 303, 623, 624, and 632 of the Communications Act of 1934,
as amended, 47 U.S.C. 151, 154(i), 201-205, 214-215, 220, 303, 543, 544
and 552, the modifications to the Commission's rules are hereby
adopted. These modifications shall become effective May 20, 2003.
List of Subjects in 47 CFR Parts 76
Cable television.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
Rule Changes
For the reasons discussed in the preamble, the Federal
Communications Commission amends 47 CFR part 76 as follows:
PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE
1. The authority citation for part 76 continues to read as follows:
Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 303, 303a,
307, 308, 309, 312, 315, 317, 325, 338, 339, 503, 521, 522, 531,
532, 533, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549, 552,
554, 556, 558, 560, 561, 571, 572, 573.
2. Section 76.5 is amended by revising the note to paragraph
(mm)(4) to read as follows:
Sec. 76.5 Definitions.
* * * * *
(mm) * * *
(4) * * *
Note to Sec. 76.5 Paragraph (mm)(4): For example, wiring
embedded in brick, metal conduit, cinder blocks, or sheet rock with
limited or without access openings would likely be physically
inaccessible; wiring enclosed within hallway molding would not.
* * * * *
3. Section 76.620 is amended by revising paragraph (a) to read as
follows:
Sec. 76.620 Non-cable multichannel video programming distributors
(MVPDs).
(a) Sections 76.605(a)(12), 76.610, 76.611, 76.612, 76.614,
76.1804(a) through (f), 76.616, and 76.617 shall apply to all non-cable
MVPDs. However, non-cable MVPD systems that are substantially built as
of January 1, 1998 shall not be subject to these sections until January
1, 2003. ``Substantially built'' shall be defined as having 75 percent
of the distribution plant completed. As of January 1, 2003, Sec.
76.1804(g) shall apply to all non-cable MVPDs serving 1000 or more
subscribers or 1000 or more units.
* * * * *
4. Section 76.802 is amended by revising paragraph (l) to read as
follows:
Sec. 76.802 Disposition of cable home wiring.
* * * * *
(l) The provisions of Sec. 76.802 shall apply to all MVPDs in the
same manner that they apply to cable operators.
5. Section 76.804 is amended by revising paragraph (b)(3) to read
as follows:
Sec. 76.804 Disposition of home run wiring.
* * * * *
(b) * * *
(3) When an MVPD that is currently providing service to a
subscriber is notified either orally or in writing that that subscriber
wishes to terminate service and that another service provider intends
to use the existing home run wire to provide service to that particular
subscriber, a provider that has elected to remove its home run wiring
pursuant to paragraph (b)(1) or (b)(2) of this section will have seven
days to remove its home run wiring and restore the building consistent
with state law. If the subscriber has requested service termination
more than seven days in the future, the seven-day removal period shall
begin on the date of actual service termination (and, in any event,
shall end no later than seven days after the requested date of
termination). If the provider has elected to abandon or sell the wiring
pursuant to paragraph (b)(1) or (b)(2) of this section, the abandonment
or sale will become effective upon actual service termination or upon
the requested date of termination, whichever occurs first. For purposes
of abandonment, passive devices, including splitters, shall be
considered part of the home run wiring. The incumbent provider may
remove its amplifiers or other active devices used in the wiring if an
equivalent replacement can easily be reattached. In addition, an
incumbent provider removing any active elements shall comply with the
notice requirements and other rules regarding the removal of home run
wiring. If the incumbent provider intends to terminate service prior to
the end of the seven-day period, the incumbent shall inform the party
requesting service termination, at the time of such request, of the
date on which service will be terminated. The incumbent provider shall
make the home run wiring accessible to the alternative provider within
the 24-hour period prior to actual service termination.
* * * * *
6. Section 76.806 is amended by adding a paragraph (d) to read as
follows:
Section 76.806 Pre-termination access to cable home wiring.
* * * * *
(d) Section 76.806 shall apply to all MVPDs.
[FR Doc. 03-6782 Filed 3-20-03; 8:45 am]
BILLING CODE 6712-10-P