Before the

Federal Communications Commission

Washington, D.C. 20554

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| In the Matter of:                | * | CS Docket No. 99-250         |
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| Amendment of Eligibility         | ) | RM-9257                      |
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REPORT AND ORDER

**Adopted: May 16, 2002** **Released: May 21, 2002**

By the Commission:

# INTRODUCTION

1.  In this Report and Order, we amend Part 78 of the Commission's rules
    to expand the class of entities eligible for licenses in the Cable
    Television Relay Service ("CARS") to include all multichannel video
    programming distributors ("MVPDs").[^1] This amendment will permit
    all MVPDs to use frequencies in the 12.70 to 13.20 GHz band ("12 GHz
    CARS band") to support the delivery of video programming for their
    systems. Currently, franchised cable systems and wireless cable
    systems are eligible for CARS licenses, but private cable operators
    ("PCOs") and other currently Non-eligible MVPDs ("NMVPDs") are not.
    This action will enhance opportunities for additional competition to
    incumbent cable operators by making NMVPDs eligible to use all CARS
    frequencies, including frequencies in the 12 GHz CARS band. It will
    also increase the number of frequencies available to NMVPDs for
    video programming distribution in the 18 GHz band (17.70 to 18.58
    GHz), in addition to those on which they may currently operate under
    Part 101 of the Commission's rules. Thus, all MVPDs will have the
    opportunity to use CARS frequencies to provide video services in a
    balanced competitive environment in which all MVPDs share microwave
    spectrum.

# BACKGROUND

2.  In July 1999, the Commission released a *Notice of Proposed
    Rulemaking* ("*NPRM"*) in this proceeding, which sought comment on
    whether to amend the Commission's rules to allow PCOs and other
    MVPDs to use frequencies in the 12 GHz CARS band for the delivery of
    video programming.[^2] Initially, the proposal to expand CARS
    eligibility to include only PCOs was submitted by OpTel, Inc.
    ("OpTel") in a Petition for Rulemaking ("Petition").[^3] On our own
    motion, we broadened the NPRM to include consideration of the
    expanded use of the 12 GHz CARS band by other NMVPDs. As we stated
    in the NPRM, one of the Commission\'s most important goals is to
    promote and facilitate competition in the video programming
    distribution market.[^4] We therefore sought comment on whether
    other types of MVPDs could use the CARS band to compete more
    effectively with cable systems and the other MVPDs that are
    currently eligible to use the CARS band. The NPRM also sought
    comment on the possible drawbacks of expanding CARS eligibility,
    particularly with respect to the impact on incumbent cable
    operators' usage of CARS links to provide service within their
    franchise areas. The NPRM also noted that this proceeding is
    interrelated with other ongoing proceedings, such as the 18 GHz
    Redesignation Proceeding,[^5] and that decisions to be made in those
    proceedings might affect the proposed usage of the 12 GHz CARS band
    by PCOs and MVPDs.

3.  OpTel is a PCO providing video and other services to residential
    users primarily in multiple dwelling units ("MDUs"). In its
    Petition, OpTel stated that it operates, through subsidiaries,
    private cable telecommunications systems and franchised cable
    systems that provide service to over 314,000 homes in nine
    cities.[^6] In the Petition, OpTel requested that PCOs be eligible
    to use frequencies on the same basis as eligible MVPDs such as
    franchised cable systems in the 12 GHz CARS band. OpTel also asked
    to be eligible to operate on frequencies in the 13.20 GHz to 13.25
    band GHz used by Broadcast Auxiliary Stations (\"BAS\").[^7] The 12
    GHz CARS band and the segment from 13.20-13.25 GHz are also shared
    with the Fixed Satellite Service (\"FSS\") for earth-to-space
    communications.[^8]

4.  Franchised cable systems and other eligible services use the 12 GHz
    and 18 GHz CARS bands for microwave relays pursuant to Part 78 of
    the Commission's Rules.[^9] Part 78 governs the licensing and
    operations of fixed or mobile CARS stations.[^10] CARS is
    principally a video transmission service used for intermediate links
    in a distribution network. Section 78.11 authorizes CARS stations to
    relay signals for and supply program material to cable television
    systems and other eligible entities using point-to-point and
    point-to-multipoint transmissions.[^11] These relay stations enable
    cable systems and other CARS licensees to transmit television
    broadcast and low power television and related audio signals, AM and
    FM broadcast stations, ITFS signals, and cablecasting from one point
    (*e.g*., on one side of a river or mountain) to another point
    (*e.g*., the other side of the river or mountain) or many points
    (\"multipoint\") via microwave. In this way, for example, they allow
    a cable system to link a community divided by a geographic barrier
    without building additional headends or laying costly cable or
    optical fiber in urbanized areas. Section 78.13 of the Commission\'s
    rules specifies that a license for a CARS station can only be issued
    to owners and operators of cable television systems and qualified
    cable network-entities, licensees and conditional licensees of
    channels in the MDS or MMDS, and certain ITFS operators.[^12] A
    primary, original, and continuing use of the 12 GHz CARS band is to
    deliver signals over long distances between reception points and
    communities. CARS is not used to provide service or relay signals
    directly to subscribers. The 12 GHz CARS band is also used for FM,
    as well as, AM links ("AML").

5.  Television broadcasters use BAS pursuant to Part 74, Subpart F.[^13]
    BAS uses the spectrum from 12.70 -- 13.25 GHz for both fixed and
    short-range mobile transmissions. In electronic news gathering
    ("ENG") operations, for example, these frequencies, together with 2
    GHz (1990 to 2110 MHz) and 7 GHz (6875 to 7125 MHz) frequencies, may
    be used to transmit a signal from the scene of an event to a nearby
    vehicle, where the signal is relayed to the TV station. [^14]

6.  OpTel and other PCOs provide service that is similar to, and
    competitive with, that provided by franchised cable systems. PCOs,
    however, do not use hard-wired crossings of public rights-of-way
    and, therefore, are not considered cable systems under the statutory
    definition.[^15] Typically, microwave facilities of PCOs, such as
    OpTel, use a hub-and-spoke architecture. In its simplest form, some
    cable headends are located at a hub, and microwave spokes are used
    to deliver video and telecommunications services to MDUs. For the
    microwave links to distribute video programming, OpTel and other
    PCOs currently transmit under authorizations in the Private
    Operational Fixed Point-to-Point Microwave Service ("OFS")[^16] in
    the band from 18.142 GHz to 18.580 GHz, which is part of the 18 GHz
    band shared by CARS and other services. PCOs are also eligible to
    use some frequencies in the band from 21.20 GHz to 23.60 GHz ("23
    GHz band"). In its petition, OpTel sought to use the 12 GHz CARS
    band as an efficient means for hub-to-hub communications.[^17] OpTel
    also stated that interconnecting hubs would eliminate or
    substantially reduce the need for duplicative headend and switching
    facilities, thus reducing costs and enabling PCOs to compete more
    effectively with franchised cable systems.[^18] We note that
    amending Part 78 to make PCOs eligible for 12 GHz CARS licenses
    would also make them eligible for CARS licenses in the 18 GHz band,
    as are other current CARS licenses.[^19] In addition, OpTel also
    requested use of the BAS frequency band segment from 13.20 to 13.25
    GHz for delivery of video programming.

7.  The NPRM sought comment on issues raised by OpTel\'s petition,
    including the technical criteria necessary to ensure that use of the
    12 GHz CARS band by PCOs or other MVPDs would not interfere with
    existing users or unduly constrain future growth of incumbent CARS
    users.[^20] The NPRM sought comment on the need of NMVPDs for access
    to the 12 GHz CARS band.[^21] The NPRM did not propose any changes
    in the technical and operational characteristics of CARS, which is a
    point-to-point and point-to-multipoint service used to relay signals
    within the system and not to the ultimate end users or subscribers.
    Rather, it sought comment on whether PCOs and other MVPDs can
    operate successfully in the 12 GHz CARS band under the existing
    technical and operational requirements.[^22] The NPRM also sought
    comment on the appropriate eligibility criteria for PCOs or other
    MVPDs who wish to obtain a CARS license and whether, after becoming
    a CARS licensee, PCO systems or other MVPDs should be designated as
    co-primary users with incumbent cable system operators or as
    secondary users.[^23]

# DISCUSSION

## Expanding Eligibility for CARS Licenses to All MVPDs

8.  Current NMVPDs supported the proposal to expand eligibility for CARS
    licenses to all MVPDs. For example, RCN, EchoStar, SkyBridge, and
    KaStar are generally supportive.[^24] Incumbent users of CARS were
    less concerned with expanded eligibility *per se* than with the
    effect of the proposed expansion on their own operations.[^25] NCTA
    expresses generalized concern that in acting on OpTel's Petition,
    the Commission do nothing that impedes the ability of cable systems
    to employ the 12 GHz CARS band "to perform the critical role that it
    has been playing in cable transmission systems for many years."[^26]
    The majority of commentary, as discussed more fully below, is
    directed to the questions of need, cost justification and technical
    criteria.

9.  The NPRM also asked whether we should distinguish between PCOs and
    other NMVPDs in our consideration of expanding eligibility for use
    of the CARS frequencies.[^27] We received no comments on this
    question. We conclude that there is no reason to make this
    distinction and, therefore, will treat all NMVPDs, including, but
    not limited to, PCOs, equally in terms of CARS eligibility.

10. Previously, the Commission extended CARS eligibility to MDS, MMDS,
    and ITFS entities in the *Wireless Cable Order,* reasoning that the
    "use of the microwave spectrum should be governed by the type of use
    rather than the type of licensee." [^28] NMVPDs arguably have the
    same use for the spectrum as those currently using it.[^29] In the
    case of wireless cable operators, the Commission concluded that
    "because cable and wireless cable have similar needs for CARS," the
    Commission's rules should not favor one set of providers over
    another.[^30] The reasoning of the *Wireless Cable Order* suggests
    that all MVPDs, whatever their primary means of program distribution
    or system architecture and regardless of whether they hold a local
    franchise, should be eligible to hold CARS licenses upon a
    demonstrated need for such spectrum and absent a finding of adverse
    consequences to currently eligible users of CARS.

11. We consider in the following sections whether PCOs and other NMVPDs
    have demonstrated a need for access to the CARS frequencies, and the
    BAS band, and whether access to the CARS and BAS frequencies would
    create an adverse impact on the current users of the bands in
    question. For the reasons discussed in detail below, we conclude
    that PCOs and other NMVPDs should generally be eligible for CARS
    licenses, and we do not anticipate undesirable effects on current
    CARS licensees.

### Need for access to 12 GHz CARS frequencies by NMVPDs

12. The NPRM sought comment on assertions that the signal propagation
    characteristics (for example, the distance over which the signal
    remains strong) of the 18 GHz band make it unsuitable for widely
    distributed systems and limits growth within the PCO industry. The
    NPRM also sought to examine assertions that, absent access to the 12
    GHz band, PCO's costs to provide service over a large area would be
    substantially greater.[^31] We sought comment on estimates of
    effective range and the assertion that PCOs need additional range.
    We also requested comment on the impact to CARS operations,
    including franchised cable systems that are currently CARS licensees
    or may need access to CARS in the future if PCO entities are allowed
    access to the 12.75-13.25 GHz band. We asked whether cable systems\'
    transition to fiber optics would obviate their need for CARS
    stations, thus lessening any potential negative impact and making
    more spectrum available to other applicants, such as PCOs and other
    MVPDs.[^32]

13. OpTel contends generally that PCOs need access to compete
    effectively with incumbent franchised cable systems. According to
    OpTel, the 12 GHz band provides superior spectrum for video
    delivery, particularly as compared to other bands of spectrum above
    21.2 GHz that private microwave licensees may use for that purpose.
    OpTel claims that those bands have neither the technical
    characteristics nor the bandwidth required to provide a video
    service that is comparable to---and competitive with---franchised
    cable service.[^33] Moreover, OpTel states that the useful range of
    a 12 GHz path is substantially greater than that of an 18 GHz path
    and therefore can substantially increase the range of a station.
    OpTel believes this difference is significant in a market in which
    the efficiency of distribution is a large factor in the cost of
    operating a system.[^34] OpTel also asserts that certain ongoing
    rulemaking proceedings threaten to limit use of the 18 GHz band by
    PCOs to distribute video programming to their customers, thus
    necessitating access to the 12 GHz CARS band to assure their
    continued existence and growth.[^35] In its Request dated November
    6, 2001, OpTel adds that allowing all MVPDs access to 12 GHz will
    spur competition by allowing them the capability to offer more
    programming and a wider variety of services and to serve more
    customers in different types of markets than is possible using 18
    GHz frequencies.[^36]

14. We examine below the effective range of communication in the 12 GHz
    CARS band compared to the 18 GHz band and the associated cost
    differences. We also examine whether the needs of the NMVPDS can be
    met by their current allocations in the 18 GHz and 23 GHz bands.
    Finally, we must take into consideration the potential displacement
    of NMVPDs from the 18 GHz band because of recent Commission
    decisions, including the 18 GHz Redesignation Proceeding mentioned
    above. Our analysis demonstrates that there is a need for access to
    the 12 GHz CARS frequencies by NMVPDs. We then balance this need
    against adverse impacts to existing users of the spectrum.

#### Range differences and cost differences

15. The NPRM requested comment on the estimates of effective range
    presented in the Petition.[^37] The data submitted in comments
    supports the assertion that the effective range for communications
    at 12 GHz is significantly greater than at 18 GHz. We note at the
    outset that the discussion centers on AM links ("AML") because of
    the greater number of channels and overall bandwidth involved. FM
    links require a larger bandwidth than AMLs, thus limiting the number
    of channels for video distribution and requiring more equipment to
    deliver the same number of channels as AMLs. FM links, however, can
    have longer path lengths and are generally more reliable. Comsearch
    and RCN assert that rain fade is the determining factor for
    effective communications range.[^38] According to one model,[^39] in
    areas of moderate rainfall, 18 GHz channels can achieve a 99.99%
    availability[^40] with a 20 dB margin over a distance of 4.8 km
    (3.0 mi.) and 12 GHz channels can achieve the same result over a
    distance of 11.8 km (7.3 mi.). For areas that experience heavier
    rainfall, the distances for 18 GHz and 12 GHz are approximately 2.3
    km (1.4 mi.) and 4.4 km (2.7 mi.), respectively. For areas that have
    significantly less rainfall, the effective distance for 18 GHz is
    11.3 km (7.0 mi.), and the effective distance for 12 GHz is limited
    by factors other than rain fade, especially multipath fading.[^41]
    This is consistent with OpTel's assertion that the effective range
    at 18 GHz is less than 8 miles and at 12 GHz is 12 miles or
    greater.[^42] It is also generally consistent with the assessment of
    RCN that the effective range at 18 GHz is 2 to 3 miles, and the
    effective range at 12 GHz is 8 to 10 miles.[^43] There is no
    evidence in the record that contradicts these estimates. Assuming
    this information is accurate, the effective link length at 12 GHz is
    more than twice that at 18 GHz and typical values would be 3 to 7
    miles for 18 GHz and 7 miles and longer for 12 GHz.

16. The NPRM asked whether there are significant differences in cost,
    supported by data, between use of 12 GHz spectrum and the 18 GHz and
    23 GHz spectrum that PCOs already are eligible to use. The only cost
    data offered in comments, supplied by RCN, indicates that the cost
    of equipment used for 18 GHz is less than that used for 12 GHz.[^44]
    RCN asserts that the net difference in cost between constructing a
    typical 12 GHz path and an 18 GHz path is directly related to the
    effective length for each.[^45] The cost of a path of given length
    is attributed largely to the number of repeaters necessary to
    achieve that length. RCN argues that the signal will degrade beyond
    an acceptable level if there are more than two repeaters (3 links)
    in the path.[^46] Each path, therefore, has a maximum distance
    beyond which systems cannot be connected by microwave thus
    necessitating that those systems have their own headend.[^47]

17. Using the typical link lengths discussed above as an example, and
    based upon the data supplied by RCN, it appears that for paths
    greater than 14 miles and less than 22 miles there are significantly
    higher costs when using 18 GHz rather than 12 GHz. It also appears
    that, for paths less than 6 miles, costs are lower for 18 GHz than
    for 12 GHz. The only figures we have are supplied by RCN, which
    indicate that a 12 GHz link costs \$95,000 and an 18 GHz link costs
    \$54,000[^48] and that a headend costs in excess of \$1.5
    million.[^49] Using the range figures quoted above for an area of
    moderate rainfall and RCN's suggested costs, the following estimates
    result.

+---------------+------------+------------+---------------------------+
| **[Distance   | **[18      | **[12      | **[Cost                   |
| (Miles)]{     | GHz]{.un   | GHz]{.un   | Di                        |
| .underline}** | derline}** | derline}** | fferential]{.underline}** |
|               |            |            |                           |
|               |            |            | **18 GHz vs. 12 GHz**     |
+---------------+------------+------------+---------------------------+
| **3**         | 1 link     | 1 link     | \- \$41,000               |
|               |            |            |                           |
|               | (\$54,000) | (\$95,000) |                           |
+---------------+------------+------------+---------------------------+
| **6**         | 2 links    | 1 link     | +\$13,000                 |
|               |            |            |                           |
|               | (          | (\$95,000) |                           |
|               | \$108,000) |            |                           |
+---------------+------------+------------+---------------------------+
| **7**         | 3 links    | 1 link     | +\$67,000                 |
|               |            |            |                           |
|               | (          | (\$95,000) |                           |
|               | \$162,000) |            |                           |
+---------------+------------+------------+---------------------------+
| **9**         | 3 links    | 2 links    | -\$28,000                 |
|               |            |            |                           |
|               | (          | (          |                           |
|               | \$162,000) | \$190,000) |                           |
+---------------+------------+------------+---------------------------+
| **14**        | New        | 2 links    | +\$1.31 million           |
|               | headend    |            |                           |
|               |            | (          |                           |
|               | (\$1.5     | \$190,000) |                           |
|               | million)   |            |                           |
+---------------+------------+------------+---------------------------+
| **22**        | New        | 3 links    | +\$1.215 million          |
|               | headend    |            |                           |
|               |            | (          |                           |
|               | (\$1.5     | \$285,000) |                           |
|               | million)   |            |                           |
+---------------+------------+------------+---------------------------+
| **\> 22**     | New        | New        | 0                         |
|               | headend    | headend    |                           |
|               |            |            |                           |
|               | (\$1.5     | (\$1.5     |                           |
|               | million)   | million)   |                           |
+---------------+------------+------------+---------------------------+

Thus, on the record presented, we conclude that for some intermediate
path lengths (between 6 and 9 miles in our example) and longer paths (14
to 22 miles in our example) costs are significantly less for operation
in the 12 GHz band than in the 18 GHz band.

#### 23 GHz

18. NMVPDs are also eligible for OFS licenses to use the 23 GHz band.
    Consequently, the NPRM also asked for a cost analysis and usage
    comparison between the 12 GHz and 23 GHz bands.[^50] The record
    shows, without contradiction, that the 23 GHz band is unsuitable for
    the needs of NMVPDs.[^51] Comsearch states that the band is used by
    PCO's for FM-Video and digital transmission, but there are no
    instances of AML (AM Video) transmission.[^52] It is also suggested
    that it would be difficult to find 500 MHz of clean spectrum,
    containing no potentially interfering signals or noise, in the 23
    GHz band in most major markets.[^53] Further, AML equipment for 23
    GHz is apparently not available.[^54] The 23 GHz band would also be
    subject to greater path length limitations than 18 GHz.[^55]
    Therefore, we agree that the use of the 23 GHz band is limited for
    the transmission of a multitude of video channels, in the range
    of 50. We continue to believe, however, that this band can continue
    to be viable for transmission of a limited number of video channels
    and for transmission of data.

#### Constraints on terrestrial use of 18 GHz band

19. OpTel alleged in its Petition that contemporaneous changes in
    Commission rules and pending actions governing use of the 18 GHz
    band created additional needs to expand CARS eligibility for use by
    NMVPDs.[^56] The NPRM asked whether an anticipated increase of
    constraints on terrestrial use of the 18 GHz band warrants making
    the 12 GHz CARS band available to NMVPDs. Subsequently, on June 22,
    2000, the Commission released the *18 GHz Redesignation Order*.[^57]
    In that Order, the Commission terminated co-primary status for most
    users in the band from 17.70 to 19.70 GHz. The band was segmented
    between terrestrial fixed services ("FS") and Geostationary ("GSO")
    and Non-Geostationary Satellite Services ("NGSO"). The FS users,
    including PCOs and other NMVPDS, were given primary status on the
    600 MHz at 17.70 to 18.30 GHz.[^58] They were also given co-primary
    status at 18.30 to 18.58 GHz and at 19.30 to 19.70 GHz.[^59] Thus,
    FS users have access to 880 MHz of contiguous spectrum from 17.70 to
    18.58 GHz. The *18 GHz Redesignation Order* also declined to allow
    new secondary operations on a non-interference basis anywhere in the
    17.70 to 19.70 GHz band.[^60] FS operations, therefore, have lost
    access to 18.58 to 19.30 GHz. The Commission rejected its original
    proposal to designate 18.30 to 18.55 GHz for use by GSO/FSS on a
    primary basis because that would jeopardize many FS, CARS, and PCO
    operations in that band.[^61] In doing so, the Commission asserted
    that this "affords PCOs the ability to maintain and upgrade their
    existing systems to compete effectively against franchised cable
    systems."[^62] The *18 GHz Redesignation Order* did not, therefore,
    change the amount of spectrum available to PCOs in the 18 GHz band.
    Section 101.603 continues to allow use of 18.142 to 18.580 GHz, in
    the 18 GHz band, as the final RF link in the chain of transmission
    of programming material to cable systems, MDS, or master antenna
    systems.[^63]

20. Hughes Electronics Corporation ("Hughes"),[^64] the Fixed Wireless
    Communication Coalition ("FWCC"),[^65] and Winstar Communications,
    Inc., ("Winstar")[^66] filed petitions for reconsideration of the
    *18 GHz* *Redesignation Order*. The Commission addressed many of the
    issues raised in these petitions in the *First Order on
    Reconsideration*, released on November 1, 2001.[^67] It deferred
    resolution, however, of the issues that impinge directly upon this
    proceeding---issues raised by Hughes on the 18 GHz band plan and
    blanket licensing.[^68] The unresolved issues are, specifically,
    designation of the 18.30 to 18.58 GHz sub-band as primary solely for
    GSO/FSS rather than co-primary with FS operations such as PCOs and
    CARS, and Hughes's allegation that the Commission did not address
    its proposal to move PCO and CARS operations altogether from 18 GHz
    to 12 GHz or 23 GHz.[^69] We cannot conclude at this time, however,
    that NMVPDs have a need for 12 GHz CARS spectrum solely based upon
    their displacement from the 18 GHz band. Rather, our decision here
    rests upon our findings and conclusion that NMVPDs need 12 GHz CARS
    spectrum based on their demonstrated need for longer path lengths
    and the cost savings obtained by using 12 GHz for these purposes.

### The 13.20 GHz to 13.25 GHz band

21. The NPRM also sought comment on request of PCOs to use the frequency
    band segment from 13.20 to 13.25 GHz for delivery of video
    programming. OpTel argues that this would allow it to provide more
    video channels, up to 82, making it more competitive with cable
    systems.[^70] The NPRM pointed out that 13.20 to 13.25 GHz is not
    designated for CARS use but rather for BAS, including on-site mobile
    transmissions for ENG. The NPRM sought comment on any existing or
    future impact sharing with CARS might have on BAS, especially as it
    relates to the required digital transition for broadcasters.

22. Broadcasters oppose allowing use of the 13.20 to 13.25 GHz band by
    PCOs.[^71] The band is deemed necessary for transmission of
    contribution quality video[^72] by TV pickup operations in ENG.[^73]
    NAB and SBE argue that this quality of video is necessary for High
    Definition Television ("HDTV") broadcast.[^74] Coverage of events at
    remote venues in digital format is a significant impetus for the
    penetration of digital television into the consumer market.[^75]
    Further, the necessary bandwidth for transmission of contribution
    quality video is 25 MHz and such channels are available to ENG TV
    pickup operations only in the 13.20 to 13.25 GHz and 13.15 to 13.20
    GHz bands in the top 100 markets.[^76]

23. Currently, BAS users have access to the 2, 7, 12, and 18 GHz bands,
    in part shared with CARS, for ENG and other uses. The Commission's
    records also indicate that the vast majority of BAS ENG service is
    performed at 2 and 7 GHz. Nevertheless, during this time of digital
    transition for broadcasters, we agree that ENG TV pickup operations
    are likely to need the 13.20 to 13.25 GHz sub-band and should remain
    primary to these users in that sub-band. We are cognizant, however,
    that this 50 MHz of spectrum is also a natural extension of the 500
    MHz of spectrum from 12.70 to 13.20 GHz allocated to CARS. We are
    aware that, under the current competitive environment, systems
    offering several hundred video channels are increasingly available
    and that cable systems with 550 MHz capacity are common. OpTel
    persuasively argues that use of the frequencies from 13.20 to
    13.25 GHz would provide it with more channels in the 12 GHz CARS
    band to be more competitive with cable systems. We, however, must
    balance spectrum demands by MVPDs against protection of the
    broadcast ENG TV pickup service and consider the goal of efficient
    spectrum usage.

24. We will allow CARS users, including the NMVPDs made eligible by this
    Order, to use the sub-band from 13.20 to 13.25 GHz as secondary
    users; that is, CARS stations must accept interference from and not
    cause interference to existing and future BAS users. Further, any
    applicant for a CARS license seeking use of the 13.20 to 13.25 GHz
    sub-band will be required to demonstrate that sufficient spectrum is
    not available to it in the 12.70 to 13.20 GHz band. Secondary status
    notwithstanding, we do not anticipate that CARS users in the 13.20
    to 13.25 GHz sub-band will experience loss of service due to
    preemption by a new primary user as there are solutions, both
    technical and non-technical, that will enable sharing of the
    frequencies. This action should afford adequate protection for BAS
    ENG while providing more efficient use of spectrum.

### Impact on competition in the video distribution market

25. The NPRM asked whether the proposed expansion of CARS eligibility
    would adversely affect competition in the video distribution market.
    This question included a request for comment on whether to give PCOs
    equal access to CARS frequencies notwithstanding that the franchised
    cable systems currently eligible for CARS have service and other
    requirements to which PCOs and other NMVPDs are not subject. For
    example, cable systems must obtain a franchise,[^77] which may have
    a requirement to serve all residents in the franchise area, and are
    subject to a franchise fee.[^78] They are also subject to regulation
    regarding leased access;[^79] must carry;[^80] program access;[^81]
    public, educational, and government channels;[^82] rate
    regulation;[^83] channel occupancy limits;[^84] sports
    blackout;[^85] network nonduplication;[^86] and syndicated
    exclusivity.[^87] Eligible MVPDs such as MDS and MMDS operators,
    like PCOs and other NMVPDs are not subject to these requirements.

26. RCN argues that access to CARS frequencies will make market
    penetration easier for non-cable MVPDs.[^88] Laying fiber optic
    cable can be costly and time consuming. RCN asserts that, by using
    CARS initially, NMVPDs can establish a customer base sufficient to
    support installation of a fiber optic network.[^89] In opposition,
    Time Warner argues that all MVPDs are not equal and that cable
    operators have franchise requirements and other regulatory burdens,
    such as must carry, which are not imposed upon the NMVPDS.[^90] Time
    Warner asserts that, for true parity to exist, PCOs should, at a
    minimum have the " 'if carry one, must carry all' obligation with
    respect to local television broadcast stations."[^91]

27. It is undeniable that NMVPDs have fewer regulatory burdens than
    franchised cable systems. It is less clear why the differences in
    franchise obligations or carriage requirements have any relevance to
    limiting CARS eligibility. For example, MDS and MMDS providers
    currently have access to CARS frequencies and they are subject to
    lesser or different regulatory requirements than franchised cable
    operators.[^92] The Commission has previously decided that these
    differences in regulatory burdens should not limit CARS
    eligibility.[^93] The regulatory disparities between cable systems
    and other MVPDs exist for historical and legitimate reasons of
    public policy and are irrelevant to the issue of whether NMVPDs
    should be excluded from using CARS frequencies. We conclude,
    therefore, that denying NMVPDs access to CARS frequencies based on
    differences in regulatory treatment would create an arbitrary
    distinction among MVPDs that would unnecessarily impede market entry
    for competitors and unnecessarily restrict their flexibility to
    provide services in an efficient and economical fashion.

### Adverse impact on the ability of cable systems to serve their community

28. The NPRM asked whether expanding CARS eligibility to NMVPDs would
    create an adverse impact on incumbent CARS licensees. In particular,
    the NPRM asked whether expanding eligibility in the 12 GHz CARS band
    would create spectrum congestion harmful to incumbent CARS
    licensees. The NPRM speculated that, though all MVPDs would be
    equally eligible to use CARS frequencies, the ability of a cable
    system to serve its community might be adversely affected because at
    some point in the future CARS frequencies necessary for franchised
    cable use might be occupied by an NMVPD.[^94] The NPRM also asked
    whether the transition to fiber optics by cable systems would
    mitigate any negative impact of expanding eligibility for CARS
    licenses.[^95]

29. The record provides no specific data on franchised cable systems'
    future needs for CARS links. RCN contends that congestion on the 12
    GHz CARS band should not be a problem in densely populated areas in
    the future as cable systems consolidate headends and shift to fiber
    optic cable, thus reducing their demand for microwave links.[^96]
    NCTA's comments tend to support this conclusion. NCTA indicates that
    the cable industry's transition to fiber optics will diminish their
    need to use CARS frequencies. NCTA, however, provides no timeframe
    for this transition, nor do they conclude that it will necessarily
    eliminate congestion concerns.[^97]

30. Sprint argues that adding new users to the 12 GHz CARS band will
    increase the likelihood of congestion.[^98] Time Warner insists
    there is potential for interference from additional users and that
    those users should prove that interference would not occur.[^99]
    NCTA states that it may be possible to accommodate NMVPDs, but it
    also asserts that there should be a burden on the NMVPDs to show
    that no problems would occur. The record, however, contains no
    information to show that frequency coordination cannot be used to
    accommodate additional CARS facilities in all but the most congested
    areas. RCN asserts that congestion may be more of a problem at 18
    GHz than at 12 GHz.[^100] Further, RCN argues that congestion and
    difficulties in frequency coordination are typically problems for
    newcomers, which predominantly will be the NMVPDs.[^101] The record
    does not show that the use of these frequencies cannot be engineered
    to accommodate NMVPDs; to the contrary, the record suggests that
    they can use the frequencies with proper coordination.[^102]
    Therefore, we conclude that frequency coordination will address all
    potential interference problems and that there is no present danger
    of congestion due to limited use of the band as needed by NMVPDs.

### Summary

31. In summary, we conclude that it is appropriate to make NMVPDs
    eligible for CARS licenses based on a demonstrated need for the
    spectrum by NMVPDs, the eligibility of other similarly situated
    MVPDs for the same licenses, and the lack of demonstrable adverse
    impacts on existing users of the spectrum. We note that our
    decisions regarding the 12 GHz CARS band in this docket are
    independent of the issues pending in the *18 GHz Redesignation
    Proceeding* and are not intended to prejudge or otherwise alter the
    issues pending on reconsideration. Allocation of the frequencies
    from 18.30 to 18.58 GHz to the GSO/FSS is the remaining issue in the
    *18 GHz Redesignation* proceeding. Any relocation of PCOs would
    entail an evaluation of costs to the PCOs and reimbursement for
    those costs. These issues would be best addressed in the *18 GHz
    Redesignation* *Proceeding*.

## Conditions and Restrictions on NMVPDs

32. The NPRM sought comment on whether we should impose special
    technical criteria to insure that NMVPDs would not interfere with
    existing users or unduly constrain growth of incumbent cable
    services. The NPRM also asked whether special eligibility criteria
    should be developed for NMVPDs, as well as whether conditions or
    restrictions other than those proposed should be imposed on the use
    of the 12 GHz CARS band by NMVPDs.

### Technical Criteria

33. Time Warner Cable proposes, as a prerequisite to the grant of a CARS
    license for operation in the 12 GHz CARS band, that applicants
    demonstrate a need to transmit more than 10 miles, as 18 GHz
    frequencies should be adequate for shorter distance links.[^103] RCN
    asserts that this would be nothing more than an unnecessary
    administrative burden.[^104] We agree that such an additional
    requirement, applicable only to NMVPDs, would be purely
    discriminatory as others who are similarly situated, such as
    wireless cable systems, need not make such a showing. CARS stations
    must operate with reduced power if their path length is less than
    the minimum path lengths currently prescribed in Section 78.108 of
    the Commission's Rules.[^105] The existing minimum path length
    restrictions are rigorously applied. Because all CARS stations must
    use less power for shorter paths and because 18 GHz equipment costs
    less, NMVPDs would have a strong economic incentive to use 18 GHz
    rather than 12 GHz for shorter paths. Thus, we do not believe
    additional regulatory restrictions or requirements are necessary in
    this regard.

34. NCTA recommends that NMVPDs be limited to hub-to-hub operations on
    12 GHz CARS because it believes 18 GHz is adequate for hub-and-spoke
    operation.[^106] OpTel counters that to limit NMVPDs to hub-to-hub
    operation would lock all NMVPDs into one system architecture and
    that the Commission should not dictate system design.[^107] OpTel
    notes that although its use of the band may involve such
    transmissions, that is simply a function of OpTel's particular
    system architecture, and that architecture should not be arbitrarily
    imposed on all other competitors desiring use of the CARS spectrum.
    Moreover, OpTel itself may need to use 12 GHz paths to reach private
    communities or more remote MDUs that are not serviceable with an 18
    GHz path. Again, we see no justification to discriminate among
    non-cable system MVPDs in terms of use restrictions, and decline to
    impose system architecture on users. We, therefore, conclude that
    NMVPDs should not be limited to hub-to-hub operations in the CARS
    band.

### Eligibility criteria

35. The NPRM asked whether CARS eligibility should be conditioned on
    service to a specified minimum number of subscribers to avoid having
    a NMVPD with a small number of subscribers occupying capacity that
    might be needed by a cable system with a large number of
    subscribers.[^108] The record offers no recommendation for a minimum
    number of subscribers that should be required as a prerequisite for
    CARS license eligibility. Only one commenter, Sprint, supports the
    minimum subscriber requirement "to prevent a PCO with a small number
    of subscribers from monopolizing a CARS station that could otherwise
    be licensed to a cable system serving a significantly larger
    subscriber base.[^109] RCN argues, however, that requiring a minimum
    number of subscribers prior to granting a CARS license would impede
    market penetration where the CARS license is necessary for the
    initial operation of the system.[^110] We are sensitive to the
    concern that a NMVPD should ultimately have a sufficient subscriber
    base for efficient use of 12 GHz CARS frequencies. On this record,
    however, we can set no minimum subscriber number. We believe that
    the economics of building CARS links will militate against using
    them for smaller operations.

36. NCTA and Sprint express concern that spectrum will be hoarded[^111].
    Eligibility criteria are not needed to avoid this problem because
    warehousing of spectrum is prohibited by operation of Section
    78.27(b) of the Commission's Rules, which provides that the CARS
    license is forfeited if the licensee does not notify the Commission
    within one year of the grant of the license that the station has
    commenced operation.[^112]

### Relative status

37. The Commission requested comment on whether NMVPDs should be
    designated as co-primary or secondary users.[^113] Some commenters
    have proposed that the NMVPDs be allowed to use the 12 GHz CARS band
    only on a secondary basis.[^114] The more persuasive argument,
    however, is that secondary status would in effect preclude access to
    this spectrum. OpTel and RCN argue that secondary status would deter
    investment in CARS equipment by NMVPDs. They also contend that
    secondary status would give other MVPDs the opportunity to
    intentionally disrupt NMVPDs' 12 GHz CARS operation by obtaining
    conflicting licenses or designing their own systems so that they
    would receive interference from existing or proposed NMVPD
    systems.[^115] Therefore, we conclude that, in order that NMVPDs may
    fairly benefit from use of the CARS bands and be true competitors,
    they should be designated co-primary users.

## Additional Changes to CARS

### Voice and data

38. The principle use of CARS is for relaying video programming as a
    component of a larger system, for example, a microwave link in a
    cable system connecting headends where the system is predominantly
    comprised of cable or hybrid fiber optic and cable connecting the
    headends to subscribers.[^116] The NPRM noted that it is
    appropriate, for example, for a CARS station to carry 60 channels of
    video programming and two channels with non-video ancillary
    services.[^117] The NPRM did not propose changing the primary use of
    CARS from video programming, but sought comment on whether and to
    what extent CARS could be used to carry voice or data on a secondary
    or tertiary basis, subject to existing technical restraints.[^118]
    Some commenters propose unlimited carriage of voice and data.[^119]
    Sprint, for example, proposes to use CARS to back-haul voice and
    data traffic from MMDS base stations instead of using fiber optic
    cable.[^120] Sprint states that this use would allow for more rapid
    deployment of high-speed advanced technological services.[^121] Some
    commenters disagreed with the limitation described in the
    NPRM.[^122] Others criticized the limited provision for data
    transmission as inadequate, and argued that failure to allow
    unrestricted use of CARS for voice and data would frustrate the
    objectives of the *MDS/ITFS Flexible Use Order* and stunt the growth
    of the MDS industry.[^123] In contrast, RCN argues that one 6 MHz
    channel used for voice or data would be sufficient.[^124]

39. Relaying video programming as part of a larger system that
    communicates by other means or spectrum is the principle use for
    CARS.[^125] We did not propose in the NPRM to change the fundamental
    character of the service. Rather, the NPRM sought comment solely on
    expansion of the types of users eligible for CARS within the
    existing parameters.[^126] Transmission of video requires large
    segments of contiguous bandwidth. Transmission of data requires
    relatively small channels and can be accommodated through other
    currently available spectrum services, which video cannot.
    Consequently, the presence of a few data channels in a path needed
    by an MVPD for video transmission may prevent the MVPD from using
    that path. Thus, the data channels would effectively occupy much
    more spectrum than needed. We believe the CARS band is best suited
    for use primarily for the transmission of video. Moreover, the
    record we rely on here for determining that expanded eligibility
    will not create unworkable congestion is based upon the assumption
    that CARS will continue to be used predominantly for video
    transmission. It is beyond the scope of this proceeding to determine
    the impact on current and future users of changing the dominant use
    of this spectrum. The *MDS/ITFS Flexible Use Order* was intended to
    allow MDS and ITFS licensees to "provide a wide array of new,
    enhanced services including new digital and two-way communications
    services."[^127] It was adopted, however, in the context of existing
    CARS permissible use limitations and availability of spectrum in
    other services. The *MDS/ITFS Flexible Use Order* did not discuss
    revisions to the CARS limitations on use. We will continue to allow
    carriage of voice and data in the same manner as currently
    permitted.[^128]

### Channel realignment and assignment

40. The NPRM also asked for comment on the realignment and reassignment
    of channel frequencies to provide for more efficient use of channels
    by facilitating continuous channel transmissions. Specifically, the
    NPRM sought comments on: 1) designating the unassigned guard band
    (12.9465-12.9525 GHz) as channel C43, and the unassigned second
    guard band (13.0057-13.0125) as channel D43; and 2) allowing CARS
    operators to slightly shift the frequencies of channels C04-C10,
    channels D04-D10, channels E04-E10, and channels F04-F10 to produce
    6 - 6 MHz video channels for each channel group (i.e., C group, D
    group, E group, and F group). Currently, applicants must seek
    waivers for a change in the frequency assignments for such minor
    frequency shifts and to use the guard band. The NPRM additionally
    sought comment on whether other changes in frequency assignments are
    necessary to provide for seamless and efficient use of the CARS
    frequency spectrum.

41. The comments support this proposed channel realignment and
    reassignment plan.[^129] Sprint also suggests, in conjunction with
    its proposal to permit unlimited non-video usage, that the rules
    allow CARS licensees to combine or subdivide channels without regard
    to the frequency assignment plan in Section 78.18 of the rules as
    long as the spectral emission requirements are met.[^130] As noted
    below in paragraph 44, the scope of this proceeding is limited and
    we intend to address flexible use issues separately. On the basis of
    the record before us, however, we find efficiency advantages to the
    new channelization plan proposed in the NPRM and will adopt it.

### Reallocation to satellite downlinks

42. The NPRM sought comment on expanding eligibility for CARS licenses
    to entities such as PCOs, open video service ("OVS") operators and
    others who provide video as their dominant service, such as the
    Direct Broadcast Satellite service ("DBS").[^131] In its comments,
    EchoStar Communications Corporation ("EchoStar") supported the
    proposed extension of eligibility to NMVPDs, but requested also that
    the Commission take it one step further. As the 12 GHz CARS band is
    adjacent to the 12.20 to 12.70 GHz DBS band, EchoStar states that
    the spectrum is of particular interest to it, if it were reallocated
    to satellite downlinks.[^132] EchoStar proposes that we allow
    ubiquitous satellite service in the 12 GHz CARS band. Further,
    inasmuch as it is very difficult for ubiquitous satellite and
    terrestrial services to coexist in the same spectrum without some
    form of coordination, EchoStar argues that the Commission should
    award exclusive licenses and auction the spectrum.[^133] EchoStar
    proposes that to make this possible, the Commission could segment
    the 12 GHz CARS band between satellite and terrestrial users.[^134]
    EchoStar also urges that this band be allocated for use by other
    point-to-multipoint systems, such as Northpoint Technology, Ltd.
    ("Northpoint"), which at the time, was being considered for
    allocation in the DBS band and has now been allocated there.[^135]
    SkyBridge and OpTel strongly oppose reallocation of the 12 GHz CARS
    band for ubiquitous satellite use because the result would be to
    preclude current terrestrial uses of the band.[^136] EchoStar's
    proposal is entirely beyond the scope of this proceeding. Our
    decision in this Order is based upon established needs for the 12
    GHz CARS band and our purpose is to extend the benefits of existing
    terrestrial uses of the spectrum to all classes of MVPDs. We can
    neither evaluate the merits of EchoStar's proposal nor develop a
    regime to implement it based upon the record before us.

43. We note that on December 3, 2001, DIRECTV, Inc., and EchoStar ("DBS
    Operators") filed a Petition requesting that the Commission
    "consider housing Northpoint's proposed service in the Cable
    Television Relay Service ("CARS") band," and consolidate pending
    proceedings relating to the 12.20 to 12.70 GHz DBS band and the
    immediately adjacent 12.70 to 13.20 GHz CARS band, including the
    instant proceeding, with the Multichannel Video Distribution and
    Data Service ("MVDDS") proceeding.[^137] The DBS Operators seek a
    declaration that alternate spectrum, in the CARS and MMDS bands, is
    suitable for the proposed MVDDS. They assert that such a
    reallocation would offer a constructive alternative to the current
    proposal to put MVDDS in the DBS band.[^138] Without expressing an
    opinion on the merits of the DBS Operators' Petition, we reiterate
    that the current proceeding is limited to addressing the narrow
    question of NMVPD eligibility to operate a CARS station under the
    current technical parameters of this service. Our cost/benefit
    determination to expand eligibility is necessarily limited to the
    record before us. As stated previously and as clearly noted in the
    NPRM, the issues related to spectrum allocation for MVDDS are
    entirely beyond the scope of this proceeding.[^139]

44. Notwithstanding that EchoStar's proposal for DBS use of the 12 GHz
    CARS band and the DBS Operators' proposal for MVDDS are beyond the
    scope of this proceeding, they raise valid issues regarding the
    applicability of flexible use policies to the 12 GHz band, which we
    intend to address in a separate proceeding. Allocating the 12 GHz
    spectrum for flexible use requires analysis that such use would be
    in the public interest, would not deter investment in communications
    services and technologies, and would not result in harmful
    interference among users.[^140] Such analysis cannot be done on the
    existing record and would require further notice and comment.

### Auctions

45. The NPRM asked whether the proposed eligibility changes would create
    a licensing scheme in which there would be mutually exclusive
    applications that should be resolved by auction.[^141] The
    Commission has stated that, "\[i\]n the majority of cases, efficient
    spectrum markets will lead to use of spectrum for the highest value
    end use. Flexible allocations may result in more efficient spectrum
    markets."[^142] The Commission has also recognized that where there
    are competing applicants "\[t\]he assignment of spectrum through
    competitive bidding has facilitated more efficient and rapid
    licensing of spectrum to those who value it most."[^143] There is
    unanimity among the commenters who discuss the issue that the
    broadening the class of entities eligible for CARS licenses, in
    itself, will not create mutually exclusive applications.[^144] As we
    have stated previously, this proceeding is limited to the narrow
    question of NMVPD eligibility to operate a CARS station under the
    current technical parameters of that service. We intend to consider
    flexible use for this frequency allocation in a separate proceeding,
    and at that time we will consider whether a new licensing scheme
    involving a greater potential for mutually exclusive applications
    would be in the public interest. Pending changes in any future
    proceeding, we will continue to use the existing frequency
    coordination system in the application process because we do not
    have a record at this time to support changing the process. As these
    frequencies are currently allocated, CARS stations are used to relay
    communications in support of other communications systems and not to
    service end users directly. Given this fact, and given the
    coordination process prior to the filing of applications, mutual
    exclusivity among filed applications has not generally been an
    issue.

46. Comsearch suggests that the frequency coordination used for
    applications filed under Part 101 of the Commission's Rules is more
    comprehensive and should be used rather the frequency coordination
    procedures currently used for CARS applications.[^145] We agree. In
    addition, to make frequency coordination procedures consistent for
    all users of these frequencies, we will conform CARS frequency
    coordination procedures to those of Part 101.

# ADMINISTRATIVE MATTERS

47. *Final Regulatory Flexibility Analysis*. As required by the
    Regulatory Flexibility Act ("RFA"),[^146] an Initial Regulatory
    Flexibility Analysis ("IRFA") was incorporated in the *Notice.* The
    Commission sought written public comments of the possible
    significant economic impact of the proposed policies and rules on
    small entities in the *Notice*, including comments on the IRFA.
    Pursuant to the RFA,[^147] a Final Regulatory Flexibility Analysis
    is contained in Appendix C.

48. *Paperwork Reduction Act*. This Report and Order contains new or
    modified information collection requirements subject to the
    Paperwork Reduction Act of 1995 ("PRA\"), Public Law 104-13. It will
    be submitted to the Office of Management and Budget ("OMB") for
    review under Section 3507(d) of the PRA. OMB, the general public,
    and other Federal agencies are invited to comment on the new or
    modified information collection requirements contained in this
    proceeding. Public and agency comments are due 60 days after the
    date of publication in the Federal Register.

# ORDERING CLAUSES

49. Accordingly, IT IS ORDERED that, pursuant to authority found in
    Sections 4(i)-(j) of the Communications Act of 1934, as amended, 47
    U.S.C. §§ 154(i)-(j), 303(c), (f), and (r), and 309(j), the
    Commission's rules ARE AMENDED as set forth in Appendix B.

50. IT IS FURTHER ORDERED that the amendments to Sections 78.18 and
    78.36 of the Commission's Rules, 47 C.F.R. §§ 78.18 & 78.36, as set
    forth in Appendix B WILL BECOME EFFECTIVE 30 days after publication
    in the Federal Register. The action contained herein has been
    analyzed with respect to the Paperwork Reduction Act of 1995, Public
    Law 104-13, and found to impose new or modified information
    collection requirements on the public. Implementation of these new
    or modified information collection requirements will be subject to
    approval by the Office of Management and Budget (OMB) as prescribed
    by the Paperwork Reduction Act; consequently, amendments to Section
    78.13 of the Commission's Rules, 47 C.F.R. §§ 78.13, as set forth in
    Appendix B WILL BECOME EFFECTIVE upon announcement in the Federal
    Register of OMB approval of the new or modified information
    collecting requirements.

51. IT IS FURTHER ORDERED that the Consumer and Governmental Affairs
    Bureau, Reference Information Center, SHALL SEND a copy of this
    Report and Order, including the Final Regulatory Flexibility
    Analysis, to the Chief Counsel for Advocacy of the Small Business
    Administration.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

APPENDIX A

## Petitioner

OpTel, Inc. ("OpTel")

## Commenters

AML Wireless Systems, Inc. ("AML")

Comsearch, Inc. ("Comsearch")

EchoStar Satellite Corporation ("EchoStar")

KaStar Satellite Communications Corp., KaStarcom. World Satellite, LLC,
and @ Contact, LLC ("KaStar")

National Association of Broadcasters ("NAB")

National Cable Television Association ("NCTA")

OpTel, Inc. ("OpTel")

RCN Telecom Services, Inc. ("RCN")

Skybridge LLC ("Skybridge")

Society of Broadcast Engineers ("SBE")

Sprint Corporation ("Sprint")

Time Warner Cable ("TWC")

Walt Disney Company, ABC, Inc. ("ABC")

Wireless Communications Association International, Inc. (WCA")

## Reply Commenters

National Cable Television Association ("NCTA")

OpTel, Inc. ("OpTel")

RCN Telecom Services, Inc. ("RCN")

SkyBridge L.L.C. ("Skybridge")

Time Warner Cable ("TWC")

APPENDIX B

Part 78 of Title 47 of the Code of Federal Regulations is amended as
follows:

Part 78 -- Cable Television Relay Service

1.  The authority for Part 78 continues to read as follows:

AUTHORITY: Secs. 2, 3, 4, 301, 303, 307, 308, 309, 48 Stat., as amended,
1064, 1065, 1066, 1081, 1082, 1083, 1084, 1085; 47 U.S.C. 152, 153, 154,
301, 303, 307, 308, 309.

2.  In Section 78.13, add paragraph (f) to read as follows:

**§ 78.13 Eligibility for license.**

**\* \* \* \* \***

\(f\) To private cable operators and other multichannel video
programming distributors not specifically identified above.

3.  In Section 78.18, revise paragraph (a)(2) and add paragraph (m) to
    read as follows:

**§ 78.18 Frequency Assignments.**

\(a\) \* \* \*

\(2\) \* \* \*

+-------------------------------+------------------+------------------+
| Group C Channels              |                  |                  |
+-------------------------------+------------------+------------------+
| Designation                   | Channel          | Alternate        |
|                               | Boundaries (GHz) | Channel          |
|                               |                  | Boundaries (GHz) |
|                               | \[C Channels\]   |                  |
|                               |                  | \[Ca Channels\]  |
+-------------------------------+------------------+------------------+
| C01^1^                        | 12.7005 --       | 12.7005 --       |
|                               | 12.7065          | 12.7065          |
+-------------------------------+------------------+------------------+
| C02^1^                        | 12.7065 --       | 12.7065 --       |
|                               | 12.7125          | 12.7125          |
+-------------------------------+------------------+------------------+
| C03^1^                        | 12.7125 --       | 12.7125 --       |
|                               | 12.7185          | 12.7185          |
+-------------------------------+------------------+------------------+
| C04^1^                        | ^2^12.7185 --    | 12.7185 --       |
|                               | 12.7225          | 12.7245          |
+-------------------------------+------------------+------------------+
| C05^1^                        | 12.7225 -        | 12.7225 -        |
|                               | 12.7285          | 12.7305          |
+-------------------------------+------------------+------------------+
| C06^1^                        | 12.7285 --       | 12.7285 --       |
|                               | 12.7345          | 12.7365          |
+-------------------------------+------------------+------------------+
| C07^1^                        | 12.7345 --       | 12.7345 --       |
|                               | 12.7405          | 12.7425          |
+-------------------------------+------------------+------------------+
| C08^1^                        | 12.7405 --       | 12.7405 --       |
|                               | 12.7465          | 12.7485          |
+-------------------------------+------------------+------------------+
| C09^1^                        | 12.7465 --       | 12.7465 --       |
|                               | 12.7525          | 12.7545          |
+-------------------------------+------------------+------------------+
| C10^1^                        | ^2^12.7525 -- 12 |                  |
|                               | 7545             |                  |
+-------------------------------+------------------+------------------+
| C11^1^                        | 12.7545 --       | 12.7545 --       |
|                               | 12.7605          | 12.7605          |
+-------------------------------+------------------+------------------+
| C12^1^                        | 12.7605 --       | 12.7605 --       |
|                               | 12.7665          | 12.7665          |
+-------------------------------+------------------+------------------+
| C13^1^                        | 12.7665 --       | 12.7665 --       |
|                               | 12.7725          | 12.7725          |
+-------------------------------+------------------+------------------+
| C14^1^                        | 12.7725 --       | 12.7725 --       |
|                               | 12.7785          | 12.7785          |
+-------------------------------+------------------+------------------+
| C15^1^                        | 12.7785 --       | 12.7785 --       |
|                               | 12.7845          | 12.7845          |
+-------------------------------+------------------+------------------+
| C16^1^                        | 12.7845 --       | 12.7845 --       |
|                               | 12.7905          | 12.7905          |
+-------------------------------+------------------+------------------+
| C17^1^                        | 12.7905 --       | 12.7905 --       |
|                               | 12.7965          | 12.7965          |
+-------------------------------+------------------+------------------+
| C18^1^                        | 12.7965 --       | 12.7965 -        |
|                               | 12.8025          | -12.8025         |
+-------------------------------+------------------+------------------+
| C19^1^                        | 12.8025 --       | 12.8025 --       |
|                               | 12.8085          | 12.8085          |
+-------------------------------+------------------+------------------+
| C20^1^                        | 12.8085 --       | 12.8085 --       |
|                               | 12.8145          | 12.8145          |
+-------------------------------+------------------+------------------+
| C21^1^                        | 12.8145 --       | 12.8145 --       |
|                               | 12.8205          | 12.8205          |
+-------------------------------+------------------+------------------+
| C22^1^                        | 12.8205 --       | 12.8205 --       |
|                               | 12.8265          | 12.8265          |
+-------------------------------+------------------+------------------+
| C23^1^                        | 12.8265 --       | 12.8265 --       |
|                               | 12.8325          | 12.8325          |
+-------------------------------+------------------+------------------+
| C24^1^                        | 12.8325 --       | 12.8325 --       |
|                               | 12.8385          | 12.8385          |
+-------------------------------+------------------+------------------+
| C25^1^                        | 12.8385 --       | 12.8385 --       |
|                               | 12.8445          | 12.8445          |
+-------------------------------+------------------+------------------+
| C26^1^                        | 12.8445 --       | 12.8445 --       |
|                               | 12.8505          | 12.8505          |
+-------------------------------+------------------+------------------+
| C27^1^                        | 12.8505 --       | 12.8505 --       |
|                               | 12.8565          | 12.8565          |
+-------------------------------+------------------+------------------+
| C28^1^                        | 12.8565 --       | 12.8565 --       |
|                               | 12.8625          | 12.8625          |
+-------------------------------+------------------+------------------+
| C29^1^                        | 12.8625 --       | 12.8625 --       |
|                               | 12.8685          | 12.8685          |
+-------------------------------+------------------+------------------+
| C30^1^                        | 12.8685 --       | 12.8685 --       |
|                               | 12.8745          | 12.8745          |
+-------------------------------+------------------+------------------+
| C31^1^                        | 12.8745 --       | 12.8745 --       |
|                               | 12.8805          | 12.8805          |
+-------------------------------+------------------+------------------+
| C32^1^                        | 12.8805 --       | 12.8805 --       |
|                               | 12.8865          | 12.8865          |
+-------------------------------+------------------+------------------+
| C33^1^                        | 12.8865 --       | 12.8865 --       |
|                               | 12.8925          | 12.8925          |
+-------------------------------+------------------+------------------+
| C34^1^                        | 12.8925 --       | 12.8925 --       |
|                               | 12.8985          | 12.8985          |
+-------------------------------+------------------+------------------+
| C35^1^                        | 12.8985 --       | 12.8985 --       |
|                               | 12.9045          | 12.9045          |
+-------------------------------+------------------+------------------+
| C36^1^                        | 12.9045 --       | 12.9045 --       |
|                               | 12.9105          | 12.9105          |
+-------------------------------+------------------+------------------+
| C37^1^                        | 12.9105 --       | 12.9105 --       |
|                               | 12.9165          | 12.9165          |
+-------------------------------+------------------+------------------+
| C38^1^                        | 12.9165 --       | 12.9165 --       |
|                               | 12.9225          | 12.9225          |
+-------------------------------+------------------+------------------+
| C39^1^                        | 12.9225 --       | 12.9225 --       |
|                               | 12.9285          | 12.9285          |
+-------------------------------+------------------+------------------+
| C40^1^                        | 12.9285 --       | 12.9285 --       |
|                               | 12.9345          | 12.9345          |
+-------------------------------+------------------+------------------+
| C41^1^                        | 12.9345 --       | 12.9345 --       |
|                               | 12.9405          | 12.9405          |
+-------------------------------+------------------+------------------+
| C42^1^                        | 12.9405 --       | 12.9405 --       |
|                               | 12.9465          | 12.9465          |
+-------------------------------+------------------+------------------+
| C43^1^                        | 12.9465 --       | 12.9465 --       |
|                               | 12.9525          | 12.9525          |
+-------------------------------+------------------+------------------+
| ^1^ See footnote 1 following  |                  |                  |
| GROUP A CHANNELS.             |                  |                  |
|                               |                  |                  |
| ^2^ For transmission of pilot |                  |                  |
| subcarriers or other          |                  |                  |
| authorized narrow band        |                  |                  |
| signals.                      |                  |                  |
+-------------------------------+------------------+------------------+

+-------------------------------+------------------+------------------+
| Group D Channels              |                  |                  |
+-------------------------------+------------------+------------------+
| Designation                   | Channel          | Alternate        |
|                               | Boundaries (GHz) | Channel          |
|                               |                  | Boundaries (GHz) |
|                               | \[D Channels\]   |                  |
|                               |                  | \[Da Channels\]  |
+-------------------------------+------------------+------------------+
| D01^1^                        | 12.7597 --       | 12.7597 --       |
|                               | 12.7657          | 12.7657          |
+-------------------------------+------------------+------------------+
| D02^1^                        | 12.7657 --       | 12.7657 --       |
|                               | 12.7717          | 12.7717          |
+-------------------------------+------------------+------------------+
| D03^1^                        | 12.7717 --       | 12.7717 --       |
|                               | 12.7777          | 12.7777          |
+-------------------------------+------------------+------------------+
| D04^1^                        | ^2^12.7777 --    | 12.7777 --       |
|                               | 12.7817          | 12.7837          |
+-------------------------------+------------------+------------------+
| D05^1^                        | 12.7817 -        | 12.7837 -        |
|                               | 12.7877          | 12.7897          |
+-------------------------------+------------------+------------------+
| D06^1^                        | 12.7877 --       | 12.7897 --       |
|                               | 12.7937          | 12.7957          |
+-------------------------------+------------------+------------------+
| D07^1^                        | 12.7937 --       | 12.7957 --       |
|                               | 12.7997          | 12.8017          |
+-------------------------------+------------------+------------------+
| D08^1^                        | 12.7997 --       | 12.8017 --       |
|                               | 12.8057          | 12.8077          |
+-------------------------------+------------------+------------------+
| D09^1^                        | 12.8057 --       | 12.8077 --       |
|                               | 12.8117          | 12.8137          |
+-------------------------------+------------------+------------------+
| D10^1^                        | ^2^12.8117 -- 12 |                  |
|                               | 8137             |                  |
+-------------------------------+------------------+------------------+
| D11^1^                        | 12.8137 --       | 12.8137 --       |
|                               | 12.8197          | 12.8197          |
+-------------------------------+------------------+------------------+
| D12^1^                        | 12.8197 --       | 12.8197 --       |
|                               | 12.8257          | 12.8257          |
+-------------------------------+------------------+------------------+
| D13^1^                        | 12.8257 --       | 12.8257 --       |
|                               | 12.8317          | 12.8317          |
+-------------------------------+------------------+------------------+
| D14^1^                        | 12.8317 --       | 12.8317 --       |
|                               | 12.8377          | 12.8377          |
+-------------------------------+------------------+------------------+
| D15^1^                        | 12.8377 --       | 12.8377 --       |
|                               | 12.8437          | 12.8437          |
+-------------------------------+------------------+------------------+
| D16^1^                        | 12.8437 --       | 12.8437 --       |
|                               | 12.8497          | 12.8497          |
+-------------------------------+------------------+------------------+
| D17^1^                        | 12.8497 --       | 12.8497 --       |
|                               | 12.8557          | 12.8557          |
+-------------------------------+------------------+------------------+
| D18^1^                        | 12.8557 --       | 12.8557 --       |
|                               | 12.8617          | 12.8617          |
+-------------------------------+------------------+------------------+
| D19^1^                        | 12.8617 --       | 12.8617 --       |
|                               | 12.8677          | 12.8677          |
+-------------------------------+------------------+------------------+
| D20^1^                        | 12.8677 --       | 12.8677 --       |
|                               | 12.8737          | 12.8737          |
+-------------------------------+------------------+------------------+
| D21^1^                        | 12.8737 --       | 12.8737 --       |
|                               | 12.8797          | 12.8797          |
+-------------------------------+------------------+------------------+
| D22^1^                        | 12.8797--        | 12.8797--        |
|                               | 12.8857          | 12.8857          |
+-------------------------------+------------------+------------------+
| D23^1^                        | 12.8857 --       | 12.8857 --       |
|                               | 12.8917          | 12.8917          |
+-------------------------------+------------------+------------------+
| D24^1^                        | 12.8917 --       | 12.8917 --       |
|                               | 12.8977          | 12.8977          |
+-------------------------------+------------------+------------------+
| D25^1^                        | 12.8977 --       | 12.8977 --       |
|                               | 12.9037          | 12.9037          |
+-------------------------------+------------------+------------------+
| D26^1^                        | 12.9037 --       | 12.9037 --       |
|                               | 12.9097          | 12.9097          |
+-------------------------------+------------------+------------------+
| D27^1^                        | 12.9097 --       | 12.9097 --       |
|                               | 12.9157          | 12.9157          |
+-------------------------------+------------------+------------------+
| D28^1^                        | 12.9157 --       | 12.9157 --       |
|                               | 12.9217          | 12.9217          |
+-------------------------------+------------------+------------------+
| D29^1^                        | 12.9217 --       | 12.9217 --       |
|                               | 12.9277          | 12.9277          |
+-------------------------------+------------------+------------------+
| D30^1^                        | 12.9277 --       | 12.9277 --       |
|                               | 12.9337          | 12.9337          |
+-------------------------------+------------------+------------------+
| D31^1^                        | 12.9337 --       | 12.9337 --       |
|                               | 12.9397          | 12.9397          |
+-------------------------------+------------------+------------------+
| D32^1^                        | 12.9397 --       | 12.9397 --       |
|                               | 12.9457          | 12.9457          |
+-------------------------------+------------------+------------------+
| D33^1^                        | 12.9457 --       | 12.9457 --       |
|                               | 12.9517          | 12.9517          |
+-------------------------------+------------------+------------------+
| D34^1^                        | 12.9517 --       | 12.9517 --       |
|                               | 12.9577          | 12.9577          |
+-------------------------------+------------------+------------------+
| D35^1^                        | 12.9577 --       | 12.9577 --       |
|                               | 12.9637          | 12.9637          |
+-------------------------------+------------------+------------------+
| D36^1^                        | 12.9637 --       | 12.9637 --       |
|                               | 12.9697          | 12.9697          |
+-------------------------------+------------------+------------------+
| D37^1^                        | 12.9697 --       | 12.9697 --       |
|                               | 12.9757          | 12.9757          |
+-------------------------------+------------------+------------------+
| D38^1^                        | 12.9757 --       | 12.9757 --       |
|                               | 12.9817          | 12.9817          |
+-------------------------------+------------------+------------------+
| D39^1^                        | 12.9817 --       | 12.9817 --       |
|                               | 12.9877          | 12.9877          |
+-------------------------------+------------------+------------------+
| D40^1^                        | 12.9877 --       | 12.9877 --       |
|                               | 12.9937          | 12.9937          |
+-------------------------------+------------------+------------------+
| D41^1^                        | 12.9937 --       | 12.9937 --       |
|                               | 12.9997          | 12.9997          |
+-------------------------------+------------------+------------------+
| D42^1^                        | 12.9997 --       | 12.9997 --       |
|                               | 13.0057          | 13.0057          |
+-------------------------------+------------------+------------------+
| D43^1^                        | 13.0057 --       | 13.0057 --       |
|                               | 13.0117          | 13.0117          |
+-------------------------------+------------------+------------------+
| ^1^ See footnote 1 following  |                  |                  |
| GROUP A CHANNELS.             |                  |                  |
|                               |                  |                  |
| ^2^ For transmission of pilot |                  |                  |
| subcarriers or other          |                  |                  |
| authorized narrow band        |                  |                  |
| signals.                      |                  |                  |
+-------------------------------+------------------+------------------+

+-------------------------------+------------------+------------------+
| Group E Channels              |                  |                  |
+-------------------------------+------------------+------------------+
| Designation                   | Channel          | Alternate        |
|                               | Boundaries (GHz) | Channel          |
|                               |                  | Boundaries (GHz) |
|                               | \[E Channels\]   |                  |
|                               |                  | \[Ea Channels\]  |
+-------------------------------+------------------+------------------+
| E01^1^                        | 12.9525 --       | 12.9525 --       |
|                               | 12.9585          | 12.9585          |
+-------------------------------+------------------+------------------+
| E02^1^                        | 12.9585 --       | 12.9585 --       |
|                               | 12.9645          | 12.9645          |
+-------------------------------+------------------+------------------+
| E03^1^                        | 12.9645 --       | 12.9645 --       |
|                               | 12.9705          | 12.9705          |
+-------------------------------+------------------+------------------+
| E04^1^                        | ^2^12.9705 --    | 12.9705 --       |
|                               | 12.9745          | 12.9765          |
+-------------------------------+------------------+------------------+
| E05^1^                        | 12.9745 -        | 12.9765 -        |
|                               | 12.9805          | 12.9825          |
+-------------------------------+------------------+------------------+
| E06^1^                        | 12.9805 --       | 12.9825 --       |
|                               | 12.9865          | 12.9885          |
+-------------------------------+------------------+------------------+
| E07^1^                        | 12.9865 --       | 12.9885 --       |
|                               | 12.9925          | 12.9945          |
+-------------------------------+------------------+------------------+
| E08^1^                        | 12.9925 --       | 12.9945 --       |
|                               | 12.9985          | 13.0005          |
+-------------------------------+------------------+------------------+
| E09^1^                        | 12.9985 --       | 13.0005 --       |
|                               | 13.0045          | 13.0065          |
+-------------------------------+------------------+------------------+
| E10^1^                        | ^2^13.0045 -- 13 |                  |
|                               | 0065             |                  |
+-------------------------------+------------------+------------------+
| E11^1^                        | 13.0065 --       | 13.0065 --       |
|                               | 13.0125          | 13.0125          |
+-------------------------------+------------------+------------------+
| E12^1^                        | 13.0125 --       | 13.0125 --       |
|                               | 13.0185          | 13.0185          |
+-------------------------------+------------------+------------------+
| E13^1^                        | 13.0185 --       | 13.0185 --       |
|                               | 13.0245          | 13.0245          |
+-------------------------------+------------------+------------------+
| E14^1^                        | 13.0245 --       | 13.0245 --       |
|                               | 13.0305          | 13.0305          |
+-------------------------------+------------------+------------------+
| E15^1^                        | 13.0305 --       | 13.0305 --       |
|                               | 13.0365          | 13.0365          |
+-------------------------------+------------------+------------------+
| E16^1^                        | 13.0365 --       | 13.0365 --       |
|                               | 13.0425          | 13.0425          |
+-------------------------------+------------------+------------------+
| E17^1^                        | 13.0425 --       | 13.0425 --       |
|                               | 13.0485          | 13.0485          |
+-------------------------------+------------------+------------------+
| E18^1^                        | 13.0485 --       | 13.0485 --       |
|                               | 13.0545          | 13.0545          |
+-------------------------------+------------------+------------------+
| E19^1^                        | 13.0545 --       | 13.0545 --       |
|                               | 13.0605          | 13.0605          |
+-------------------------------+------------------+------------------+
| E20^1^                        | 13.0605 --       | 13.0605 --       |
|                               | 13.0665          | 13.0665          |
+-------------------------------+------------------+------------------+
| E21^1^                        | 13.0665 --       | 13.0665 --       |
|                               | 13.0725          | 13.0725          |
+-------------------------------+------------------+------------------+
| E22^1^                        | 13.0725--        | 13.0725--        |
|                               | 13.0785          | 13.0785          |
+-------------------------------+------------------+------------------+
| E23^1^                        | 13.0785 --       | 13.0785 --       |
|                               | 13.0845          | 13.0845          |
+-------------------------------+------------------+------------------+
| E24^1^                        | 13.0845 --       | 13.0845 --       |
|                               | 13.0905          | 13.0905          |
+-------------------------------+------------------+------------------+
| E25^1^                        | 13.0905 --       | 13.0905 --       |
|                               | 13.0965          | 13.0965          |
+-------------------------------+------------------+------------------+
| E26^1^                        | 13.0965 --       | 13.0965 --       |
|                               | 13.1025          | 13.1025          |
+-------------------------------+------------------+------------------+
| E27^1^                        | 13.1025 --       | 13.1025 --       |
|                               | 13.1085          | 13.1085          |
+-------------------------------+------------------+------------------+
| E28^1^                        | 13.1085 --       | 13.1085 --       |
|                               | 13.1145          | 13.1145          |
+-------------------------------+------------------+------------------+
| E29^1^                        | 13.1145 --       | 13.1145 --       |
|                               | 13.1205          | 13.1205          |
+-------------------------------+------------------+------------------+
| E30^1^                        | 13.1205 --       | 13.1205 --       |
|                               | 13.1265          | 13.1265          |
+-------------------------------+------------------+------------------+
| E31^1^                        | 13.1265 --       | 13.1265 --       |
|                               | 13.1325          | 13.1325          |
+-------------------------------+------------------+------------------+
| E32^1^                        | 13.1325 --       | 13.1325 --       |
|                               | 13.1385          | 13.1385          |
+-------------------------------+------------------+------------------+
| E33^1^                        | 13.1385 --       | 13.1385 --       |
|                               | 13.1445          | 13.1445          |
+-------------------------------+------------------+------------------+
| E34^1^                        | ^3^13.1445 --    | ^3^13.1445 --    |
|                               | 13.1505          | 13.1505          |
+-------------------------------+------------------+------------------+
| E35^1^                        | ^3^13.1505 --    | ^3^13.1505 --    |
|                               | 13.1565          | 13.1565          |
+-------------------------------+------------------+------------------+
| E36^1^                        | ^3^13.1565 --    | ^3^13.1565 --    |
|                               | 13.1625          | 13.1625          |
+-------------------------------+------------------+------------------+
| E37^1^                        | ^3^13.1625 --    | ^3^13.1625 --    |
|                               | 13.1685          | 13.1685          |
+-------------------------------+------------------+------------------+
| E38^1^                        | ^3^13.1685 --    | ^3^13.1685 --    |
|                               | 13.1745          | 13.1745          |
+-------------------------------+------------------+------------------+
| E39^1^                        | ^3^13.1745 --    | ^3^13.1745 --    |
|                               | 13.1805          | 13.1805          |
+-------------------------------+------------------+------------------+
| E40^1^                        | ^3^13.1805 --    | ^3^13.1805 --    |
|                               | 13.1865          | 13.1865          |
+-------------------------------+------------------+------------------+
| E41^1^                        | ^3^13.1865 --    | ^3^13.1865 --    |
|                               | 13.1925          | 13.1925          |
+-------------------------------+------------------+------------------+
| E42^1^                        | ^3^13.1925 --    | ^3^13.1925 --    |
|                               | 13.1985          | 13.1985          |
+-------------------------------+------------------+------------------+
| ^1^ See footnote 1 following  |                  |                  |
| GROUP A CHANNELS.             |                  |                  |
|                               |                  |                  |
| ^2^ For transmission of pilot |                  |                  |
| subcarriers or other          |                  |                  |
| authorized narrow band        |                  |                  |
| signals.                      |                  |                  |
|                               |                  |                  |
| ^3^ See paragraph (l) of this |                  |                  |
| Section.                      |                  |                  |
+-------------------------------+------------------+------------------+

+-------------------------------+------------------+------------------+
| Group F Channels              |                  |                  |
+-------------------------------+------------------+------------------+
| Designation                   | Channel          | Alternate        |
|                               | Boundaries (GHz) | Channel          |
|                               |                  | Boundaries (GHz) |
|                               | \[F Channels\]   |                  |
|                               |                  | \[Fa Channels\]  |
+-------------------------------+------------------+------------------+
| F01^1^                        | 13.0125 --       | 13.0125 --       |
|                               | 13.0185          | 13.0185          |
+-------------------------------+------------------+------------------+
| F02^1^                        | 13.0185 --       | 13.0185 --       |
|                               | 13.0245          | 13.0245          |
+-------------------------------+------------------+------------------+
| F03^1^                        | 13.0245 --       | 13.0245 --       |
|                               | 13.0305          | 13.0305          |
+-------------------------------+------------------+------------------+
| F04^1^                        | ^2^13.0305 --    | 13.0305 --       |
|                               | 13.0345          | 13.0365          |
+-------------------------------+------------------+------------------+
| F05^1^                        | 13.0345 --       | 13.0365 --       |
|                               | 13.0405          | 13.0425          |
+-------------------------------+------------------+------------------+
| F06^1^                        | 13.0405 --       | 13.0425 --       |
|                               | 13.0465          | 13.0485          |
+-------------------------------+------------------+------------------+
| F07^1^                        | 13.0465 --       | 13.0485 --       |
|                               | 13.0525          | 13.0545          |
+-------------------------------+------------------+------------------+
| F08^1^                        | 13.0525 --       | 13.0545 --       |
|                               | 13.0585          | 13.0605          |
+-------------------------------+------------------+------------------+
| F09^1^                        | 13.0585 --       | 13.0605 --       |
|                               | 13.0645          | 13.0665          |
+-------------------------------+------------------+------------------+
| F10^1^                        | ^2^13.0645 --    |                  |
|                               | 13.0665          |                  |
+-------------------------------+------------------+------------------+
| F11^1^                        | 13.0665 --       | 13.0665 --       |
|                               | 13.0725          | 13.0725          |
+-------------------------------+------------------+------------------+
| F12^1^                        | 13.0725--        | 13.0725--        |
|                               | 13.0785          | 13.0785          |
+-------------------------------+------------------+------------------+
| F13^1^                        | 13.0785 --       | 13.0785 --       |
|                               | 13.0845          | 13.0845          |
+-------------------------------+------------------+------------------+
| F14^1^                        | 13.0845 --       | 13.0845 --       |
|                               | 13.0905          | 13.0905          |
+-------------------------------+------------------+------------------+
| F15^1^                        | 13.0905 --       | 13.0905 --       |
|                               | 13.0965          | 13.0965          |
+-------------------------------+------------------+------------------+
| F16^1^                        | 13.0965 --       | 13.0965 --       |
|                               | 13.1025          | 13.1025          |
+-------------------------------+------------------+------------------+
| F17^1^                        | 13.1025 --       | 13.1025 --       |
|                               | 13.1085          | 13.1085          |
+-------------------------------+------------------+------------------+
| F18^1^                        | 13.1085 --       | 13.1085 --       |
|                               | 13.1145          | 13.1145          |
+-------------------------------+------------------+------------------+
| F19^1^                        | 13.1145 --       | 13.1145 --       |
|                               | 13.1205          | 13.1205          |
+-------------------------------+------------------+------------------+
| F20^1^                        | 13.1205 --       | 13.1205 --       |
|                               | 13.1265          | 13.1265          |
+-------------------------------+------------------+------------------+
| F21^1^                        | 13.1265 --       | 13.1265 --       |
|                               | 13.1325          | 13.1325          |
+-------------------------------+------------------+------------------+
| F22^1^                        | 13.1325 --       | 13.1325 --       |
|                               | 13.1385          | 13.1385          |
+-------------------------------+------------------+------------------+
| F23^1^                        | 13.1385 --       | 13.1385 --       |
|                               | 13.1445          | 13.1445          |
+-------------------------------+------------------+------------------+
| F24^1^                        | ^3^13.1445 --    | ^3^13.1445 --    |
|                               | 13.1505          | 13.1505          |
+-------------------------------+------------------+------------------+
| F25^1^                        | ^3^13.1505 --    | ^3^13.1505 --    |
|                               | 13.1565          | 13.1565          |
+-------------------------------+------------------+------------------+
| F26^1^                        | ^3^13.1565 --    | ^3^13.1565 --    |
|                               | 13.1625          | 13.1625          |
+-------------------------------+------------------+------------------+
| F27^1^                        | ^3^13.1625 --    | ^3^13.1625 --    |
|                               | 13.1685          | 13.1685          |
+-------------------------------+------------------+------------------+
| F28^1^                        | ^3^13.1685 --    | ^3^13.1685 --    |
|                               | 13.1745          | 13.1745          |
+-------------------------------+------------------+------------------+
| F29^1^                        | ^3^13.1745 --    | ^3^13.1745 --    |
|                               | 13.1805          | 13.1805          |
+-------------------------------+------------------+------------------+
| F30^1^                        | ^3^13.1805 --    | ^3^13.1805 --    |
|                               | 13.1865          | 13.1865          |
+-------------------------------+------------------+------------------+
| F31^1^                        | ^3^13.1865 --    | ^3^13.1865 --    |
|                               | 13.1925          | 13.1925          |
+-------------------------------+------------------+------------------+
| F32^1^                        | ^3^13.1925 --    | ^3^13.1925 --    |
|                               | 13.1985          | 13.1985          |
+-------------------------------+------------------+------------------+
| ^1^ See footnote 1 following  |                  |                  |
| GROUP A CHANNELS.             |                  |                  |
|                               |                  |                  |
| ^2^ For transmission of pilot |                  |                  |
| subcarriers or other          |                  |                  |
| authorized narrow band        |                  |                  |
| signals.                      |                  |                  |
|                               |                  |                  |
| ^3^ See paragraph (l) of this |                  |                  |
| Section.                      |                  |                  |
+-------------------------------+------------------+------------------+

\* \* \* \* \*

\(m\) CARS stations may be authorized use of the band from 13.20 to
13.25 GHz on a secondary basis to Television Broadcast Auxiliary
Stations. Any CARS application seeking authorization for use of the
13.20 to 13.25 GHz band must demonstrate that sufficient spectrum is not
available in the 12.70 to 13.20 GHz band.

4.  Revise Section 78.36 to read as follows:

**§ 78.36 Frequency coordination.**

Coordination of fixed and mobile assignments will be in accordance with
the procedure established in § 101.103(d) of this chapter.

APPENDIX C

FINAL REGULATORY FLEXIBILITY ANALYSIS

1.  As required by the Regulatory Flexibility Act ("RFA"),[^148] an
    Initial Regulatory Flexibility Analysis ("IRFA") was incorporated in
    the Notice of Proposed Rulemaking ("Notice") in CS Docket No.
    99-250, FCC 99-166. The Commission sought written public comment on
    the proposals in the Notice, including comment on the IRFA.[^149]
    This Final Regulatory Flexibility Analysis ("FRFA") conforms to the
    RFA.[^150]

## Need for, and Objectives of, this Report and Order.

52. The Commission undertook this proceeding in response to a petition
    for rulemaking filed by OpTel, Inc. The Notice sought comment on
    OpTel's request that we expand the definition of entities eligible
    to use the 12 GHz Cable Television Relay Service ("CARS") frequency
    band to include private cable operators ("PCOs"). CARS is a
    microwave radio service used predominantly by cable systems to
    provide video links between portions of their systems. PCOs provide
    a video service similar to cable systems, for example, to apartment
    buildings, but PCOs do not use public rights-of-way. By its own
    motion, the Commission expanded the Notice to include other
    multichannel video programming distributors ("MVPDs"). MVPDs are
    anyone who provides multiple channels of video programming to
    subscribers. This Report and Order adopts rules which will increase
    competition to incumbent, franchised cable operators, particularly
    with regard to video programming service to multi-dwelling units, by
    expanding eligibility to use the CARS band to PCOs and other MVPDs,
    such as direct broadcast satellite ("DBS") and open video systems
    ("OVS"). This Report and Order promotes competition in multichannel
    video programming distribution by allowing new services to compete
    with existing services by giving those new services access to the
    same technologies as existing services while balancing the interests
    of incumbent distributors by not hampering their use of those
    technologies.

## Summary of Significant Issues Raised by Public Comments in Response to IRFA.

53. We received one comment in direct response to the IRFA. The Society
    of Broadcast Engineers ("SBE") states that the Commission analysis
    in the IRFA of the impact on small entities did not include the
    needs for production spectrum of television broadcasters and Local
    Television Transmission Service ("LTTS").[^151] Although the IRFA
    did not specifically mention broadcasters or LTTS providers, the
    Commission did request comment concerning the impact on small
    businesses, small organizations, and small business concerns.[^152]
    In addition, the Notice requested comment on "the compatibility of
    shared use of the spectrum between fixed PCOs and mobile \[broadcast
    auxiliary stations\]" and on "any existing or future impact this
    sharing may have with BAS, especially as it relates to the required
    digital transition for broadcasters."[^153] SBE and others discussed
    this specific issue in their comments. Briefly, SBE opposes use of
    the spectrum from 13.20 GHz to 13.25 GHz by PCOs as proposed by the
    PCOs. The Order addresses and pays all due deference to the concerns
    and issues raised. The PCOs are allocated the spectrum only as
    secondary users of the spectrum from 13.20 GHz to 13.25 GHz, which
    means they cannot cause interference to television broadcasters or
    LTTS providers.

## Description and Estimate of the Number of Small Entities to Which the Rules Will Apply.

54. The RFA directs the Commission to provide a description of and,
    where feasible, an estimate of the number of small entities that
    will be affected by the rules adopted herein.[^154] The RFA defines
    the term "small entity" as having the same meaning as the terms
    "small business," "small organization," and "small governmental
    jurisdiction" under Section 3 of the Small Business Act.[^155] Under
    the Small Business Act, a small business concern is one which: (1)
    is independently owned and operated; (2) is not dominant in its
    field of operation; and (3) satisfies any additional criteria
    established by the Small Business Administration ("SBA").[^156] A
    small organization is generally "any "not-for-profit enterprise
    which is independently owned and operated and is not dominant in its
    field."[^157] Nationwide, as of 1992, there were approximately
    275,801 small organizations.[^158] "Small government
    jurisdiction"[^159] generally means "governments of cities,
    counties, towns, townships, villages, school districts, or special
    districts, with a population of less than 50,000."[^160] As of 1992,
    there were approximately 85,006 governmental entities in the United
    States.[^161] This number includes 38,978 counties, cities, and
    towns: of these, 37,566, or 96%, have populations of fewer than
    50,000.[^162] The Census Bureau estimates that this ratio is
    approximately accurate for all governmental entities. Thus, of the
    85,006 governmental entities, we estimate that 81,600 (96%) are
    small entities. Below, we further describe and estimate the number
    of small entity licensees and regulatees that may be affected by
    these rules.

55. The rules we adopt as a result of the Report and Order will add PCOs
    and other MVPDs to those entities eligible to use the 12 GHz CARS
    frequency band. The 12 GHz CARS frequency band, 12.70 GHz -- 13.25
    GHz, is currently used by franchised cable, licensees and
    conditional licensees of channels in the Multipoint Distribution
    Service ("MDS"), Multichannel, Multipoint Distribution Service
    ("MMDS"), and Instructional Television Fixed Services
    ("ITFS").[^163] The 12 GHz CARS spectrum, 12 GHz -- 12.35 GHz, is
    also used by television broadcasters for both fixed and short-range
    mobile transmissions by Broadcast Auxiliary Stations ("BAS").[^164]

56. *Small MVPDs*. SBA has developed a definition of small entities for
    cable and other pay television services, which includes such
    companies generating \$11 million or less in annual receipts.[^165]
    This definition includes cable system operators, closed circuit
    television services, direct broadcast satellite services, multipoint
    distribution systems, satellite master antenna systems, and
    subscription television services. According to the Census Bureau,
    there were 1,423 such cable and other pay television services
    generating less than \$11 million in revenue.[^166] We address below
    services individually to provide a more precise estimate of small
    entities.

57. The Commission has developed, with SBA's approval, its own
    definition of a small cable system operator for the purposes of rate
    regulation. Under the Commission's rules, a "small cable company" is
    one serving fewer than 400,000 subscribers nationwide.[^167] Based
    on our most recent information, we estimate that there were 1439
    cable operators that qualified as small cable companies at the end
    of 1995.[^168] Since then, some of those companies may have grown to
    serve over 400,000 subscribers, and others may have been involved in
    transactions that caused them to be combined with other cable
    operators. The Commission's rules define a "small system," for the
    purposes of rate regulation, as a cable system with 15,000 or fewer
    subscribers.[^169] The Commission does not request nor does the
    Commission collect information concerning cable systems serving
    15,000 or fewer subscribers and thus is unable to estimate, at this
    time, the number of small cable systems nationwide.

58. The Communications Act also contains a definition of a small cable
    system operator, which is "a cable operator that, directly of
    through an affiliate, serves in the aggregate fewer than 1% of all
    subscribers in the United States and is not affiliated with any
    entity or entities whose gross annual revenues in the aggregate
    exceed \$250,000,000."[^170] The Commission has determined that
    there are 61,700,000 subscribers in the United States. Therefore, a
    cable operator serving fewer than 617,000 subscribers shall be
    deemed a small operator, if its annual revenues, when combined with
    the total annual revenues of all of its affiliates, do not exceed
    \$250 million in the aggregate.[^171] Based on available data, we
    find that the number of cable operators serving 617,000 subscribers
    or less totals approximately 1450.[^172] Although it seems certain
    that some of these cable system operators are affiliated with
    entities whose gross annual revenues exceed \$250,000,000, we are
    unable at this time to estimate with greater precision the number of
    cable system operators that would qualify as small cable operators
    under definition in the Communications Act. It should be further
    noted that recent industry estimates project that there will be a
    total of 64,000,000 subscribers and we have based our fee revenue
    estimates on that figure.

59. *Private Cable Operators/Satellite Master Antenna Systems*. Based on
    our most recent information, we estimate that there are 3400 private
    cable operators serving multiple dwelling units that qualify as
    small cable companies.[^173] Some of those companies may have grown
    to serve from 800,000 to 1.6 million subscribers,[^174] and others
    may have been involved in transactions that caused them to be
    combined with other cable operators. Consequently, we estimate that
    there are fewer than 3,400 small entity private cable system
    operators that may be affected by the decisions and rules we are
    adopting.

60. *Open Video System* (*"OVS"*). The Commission has certified eleven
    OVS operators. Of these eleven, only two are providing service.
    Affiliates of residential Communications Network, Inc. ("RCN")
    received approval to operate OVS systems in New York City, Boston,
    Washington, D.C., and other areas. RCN has sufficient revenues to
    assure us that they do not qualify as small business entities.
    Little financial information is available for the other entities
    authorized to provide OVS service that are not yet operational.
    Given that other entities have been authorized to provide OVS
    service but have not yet begun to generate revenues, we conclude
    that at least some of the OVS operators qualify as small entities.

61. *Multichannel, Multipoint Distribution Service* ("*MMDS*"). The
    Commission refined the definition of "small entity" for the auction
    of MMDS as an entity that, together with its affiliates, has average
    gross revenues that are not more than \$40 million for the
    proceeding three calendar years.[^175] This definition of a small
    entity, in the context of the Commission's decision concerning MMDS
    auctions, has been approved by the SBA.[^176]

62. The Commission completed its MMDS auction in March 1996 for
    authorization in 493 basic trading areas ("BTAs"). Of the 67 winning
    bidders, 61 qualified as small entities. Five winners indicated that
    they were minority-owned and four winners indicated that they were
    women-owned businesses. MMDS is an especially competitive service,
    with approximately 1573 previously authorized and proposed MMDS
    facilities. Information available to us indicates that no MMDS
    facility generates revenue in excess of \$11 million annually. We
    conclude that there are approximately 1634 small MMDS providers as
    defined by the SBA and the Commission's auction rules.

## Description of Projected Reporting, Record Keeping and other Compliance Requirements.

63. This Report and Order makes an additional class that will be
    eligible for CARS licenses. As such, they will be subject to the
    reporting, record keeping, and other compliance requirements of
    CARS. These newly eligible entities will be required to file an
    application, FCC Form 327, to obtain a license and to modify or
    renew that license. They will also be required to maintain certain
    station records related to maintenance of the technical parameters
    of the station, as specified in Section 78.69 of the Commission's
    Rules.[^177]

## Steps Taken to Minimize the Impact on Small Entities, and Significant Alternatives Considered.

64. The RFA requires an agency to describe any significant alternatives
    that it has considered in developing its approach, which may include
    the following four alternatives (among others): "(1) the
    establishment of differing compliance or reporting requirements or
    timetables that take into account the resources available to small
    entities; (2) the clarification, consolidation, or simplification of
    compliance and reporting requirements under the rule for such small
    entities; (3) the use of performance rather than design standards;
    and (4) an exemption from coverage of the rule, or any part thereof,
    for such small entities."[^178]

65. This Report and Order creates opportunities for small entities, such
    as PCOs and other MVPDs, to compete with incumbent providers of
    video programming in the 12 GHz CARS frequency band. The
    Commission's decision will allow new entrants, many of whom are
    deemed to be small entities, to have access to the 12 GHz CARS
    frequency band on an equal basis with franchised cable operators and
    other users.

66. No significant alternatives were considered other than to examine
    whether the options currently available to the entities currently
    not eligible for CARS licenses are adequate for their needs. These
    options are use of 18 GHz frequencies or 23 GHz frequencies under
    Part 101 of the Commission's Rules.[^179] In the Order, the
    Commission has decided that because the 12 GHz CARS band provides
    greater range at a reduced cost, that the petitioning PCOs should be
    given the relief requested. On its own motion, the Commission
    extended the eligibility to use the 12 GHz CARS band to all MVPDs.
    Further, the Commission made these entities eligible to use all CARS
    frequencies, rather than just the 12 GHz band. This will eliminate a
    significant barrier to entry into the MVPD market for small entities
    and will lessen the cost of expansion for others. Small entities,
    from a regulatory standpoint, will now be on a par with wireless
    cable operators and, in this sense, with cable systems.[^180]

67. **[Report to Congress.]{.underline}** We will send a copy of this
    Report and Order, including this FRFA, in a report to Congress
    pursuant to the Congressional Review Act of 1996, 5 U.S.C.
    § 801(a)(1)(A). A copy of this report and Order and FRFA (or summary
    thereof) will also be published in the Federal Register, pursuant to
    5 U.S.C. § 604(b), and will be sent to the Chief Counsel for
    Advocacy of the Small Business Administration.

[^1]: "Multichannel video programming distributor" means a person such
    as, but not limited to, a cable operator, a multichannel multipoint
    distribution service, a direct broadcast satellite service, or a
    television receive-only satellite program distributor, who makes
    available for purchase, by subscribers or customers, multiple
    channels of video programming." 47 U.S.C. § 522(13).

[^2]: *Amendment of Eligibility Requirements in Part 78 Regarding 12 GHz
    Cable Television Relay Service,* 14 FCC Rcd 11967 (1999) ("NPRM").
    Fourteen parties filed comments and five parties filed reply
    comments. A list of parties filing comments and reply comments is
    attached as Appendix A.

[^3]: Petition for Rulemaking (filed April 1, 1998) ("Petition").

[^4]: *NPRM*, 14 FCC Rcd at 11969.

[^5]: IB Docket No. 98-172.

[^6]: *NPRM*, 14 FCC Rcd at 11970-71. In a November 6, 2001, submission
    in this docket styled as a "Request for Action," OpTel states that
    it filed for Chapter 11 bankruptcy protection in October 1999.
    ("OpTel November 6 Request"). OpTel notes that it is now ready to
    exit Chapter 11, and, when it does so, it plans to focus exlusively
    on providing video and Internet access services primarily in the MDU
    marketplace in direct competition with incumbent cable operators.
    OpTel November 6 Request at 2.

[^7]: 47 C.F.R. §§ 74.600 -- 74.690*.*

[^8]: *Id*. §§ 2.106, 78.106 & 101.101.

[^9]: *Id*. §§ 78.1 -- 78.115*.*

[^10]: A CARS station is a "fixed or mobile station used for the
    transmission of television and related audio signals, signals of
    standard and FM broadcast stations, signals of instructional
    television fixed stations, and cablecasting from the point of
    reception to a terminal point from which the signals are distributed
    to the public." *Id*. § 78.5(a).

[^11]: *Id.* §§ 78.11(a),(c), & (d).

[^12]: *Id*. § 78.13.

[^13]: *Id*. §§ 74.600-74.690*.*

[^14]: *Id*. § 74.602(a).

[^15]: 47 U.S.C. § 522(7).

[^16]: 47 C.F.R. §§ 101.101-151 & 101.601-3.

[^17]: Petition at 2. OpTel also filed a separate petition requesting a
    waiver of Section 101.603 in order to allow OpTel to transmit video
    programming in the 10.70 GHz - 11.70 GHz band ("11 GHz band"). The
    Commission denied OpTel\'s waiver request. *See* *Petition for
    Waiver of Section 101.603 of the Commission\'s Rules*, 14 FCC Rcd
    3762 (1999). OpTel noted that its waiver request involved different
    frequencies (11 GHz band) and issues different from those raised in
    this proceeding.

[^18]: Petition at 3. *See also* RCN Comments at 4, 14.

[^19]: 47 C.F.R. § 78.18(a)(4). Thus, a PCO could choose between
    applying for an OFS license to use 18.142-18.580 GHz for data and
    voice, as well as video, or applying for a CARS license to use 17.70
    to 18.580 GHZ, which must be used principally for video..

[^20]: *NPRM*, 14 FCC Rcd at 11975.

[^21]: *Id.* at 11974.

[^22]: *Id*. at 11979.

[^23]: *Id.* at 11974.

[^24]: *See* EchoStar Comments at 1-2; SkyBridge Comments at 1-3; KaStar
    Commentss at 5; RCN Comments at 2-7.

[^25]: *See, e.g.,* Sprint Comments at 2-5: SBE Comments at 1-4
    (addressing proposed use of 13.20 to 13.25 GHz); Walt Disney Co.
    Comments at 1-3 (concurring with SBE Comments).

[^26]: NCTA Comments at 2. NCTA also argued that it would reserve
    judgement on this question until it could assess the record produced
    in this proceeding. In its Reply Comments, NCTA challenged the
    sufficiency of the evidence produced on specific issues such as cost
    savings and whether the NMVPDs should be granted equal status in
    obtaining access to 12 GHz frequencies. NCTA Reply Comments at 2-8.
    *See also* Time Warner Comments at 2-17, raising questions of
    competitive parity, lack of evidence of cost savings, and the need
    to grant only secondary status, if any to NMVPDs. We address these
    specific challenges below.

[^27]: *See* NPRM, 14 FCC Rcd 11967, 11969 (1999).

[^28]: *Amendment of Parts 21, 43, 74, 78 and 94 of the Commission's
    Rules Governing Use of the Frequencies in the 2.1 and 2.5 GHz Band
    Affecting: Private Operational-Fixed Microwave Service, Multipoint
    Distribution Service, Instructional Television Fixed Service, and
    Cable Television Relay Service*, 5 FCC Rcd 6410, 6423 (1990)
    (quoting Spectrum Utilization Policy for Fixed and Mobile Services
    in the 947 MHz-40 GHz Band, 48 Fed. Reg. 6730, ¶ 31 (1983))
    ("*Wireless Cable Order*").

[^29]: *NPRM*, 14 FCC Rcd at 11967.

[^30]: *Wireless Cable Order,* 5 FCC Rcd at 6423.

[^31]: Petition at 2.

[^32]: *NPRM*, 14 FCC Rcd at 11974 -- 75.

[^33]: OpTel Comments at 2-3, (citing 47 C.F.R. § 101.603).

[^34]: *Id.* at 3.

[^35]: *Id.* at 3-4.

[^36]: OpTel November 6 Request at 3.

[^37]: *NPRM*, 14 FCC Rcd at 11975.

[^38]: RCN Comments at 6; Comsearch Comments at 3.

[^39]: Comsearch Comments at 3-5 (citing Robert K Crane, *Prediction of
    Attenuation by Rain*, 28 IEEE Transactions on Communications (1980).

[^40]: 99.99% availability is the performance factor used in the model.
    It is not an established value for CARS and no such performance
    factor has been set.

[^41]: Comsearch Comments at 3.

[^42]: OpTel Comments at 3.

[^43]: RCN Comments at 6.

[^44]: RCN Reply Comments at n.21.

[^45]: *See* RCN Comments at 8; RCN Reply Comments at 5-6.

[^46]: RCN Comments at 7.

[^47]: *Id.* at 8.

[^48]: *See* RCN Reply Comments at 5. RCN provides the total cost for a
    three link path as \$163,000, which gives an average per link cost
    of approximately \$54,000. RCN states that 18 GHz equipment is
    cheaper and that a big part of the cost for additional links is site
    rental of \$2,000 to \$4,000. RCN Comments at 6 and note 21. This
    indicates that the cost for the first link is probably closer to
    \$52,000 and for subsequent links \$55,000 to \$56,000. For
    simplicity, we use the average value as the cost of equipment
    appears to be the predominant part of the cost.

[^49]: RCN Comments at 8.

[^50]: *NPRM*, 14 FCC Rcd at 11973.

[^51]: RCN Comments at n.2.

[^52]: Comsearch Comments at 2.

[^53]: *Id*.

[^54]: *Id*. at 3.

[^55]: *Id*.

[^56]: *NPRM*, 14 FCC Rcd at 11975 -- 76 (1999); Petition at 5.

[^57]: *Redesignation of the 17.7-19.7 GHz Frequency Band, Blanket
    Licensing of Satellite Earth Stations in the 17.7-20.2 GHz and
    27.5-30.0 GHz Frequency Bands, and the Allocation of Additional
    Spectrum in the 17.3-17.8 GHz and 24.75-25.25 GHz Frequency Bands
    for Broadcast Satellite Service Use*, 15 FCC Rcd 13430 (2000) ("*18
    GHz Redesignation Order*").

[^58]: FS users cannot use the frequencies from 17.7 to 18.142 GHz for
    the final rf link in the transmission chain of programming material
    to cable systems, MDS, or master antenna systems. 47 C.F.R. §
    101.603(b)(3).

[^59]: *18 GHz Redesignation Order*, 15 FCC Rcd at 13443.

[^60]: *Id.* at 13444.

[^61]: *Id.* at 13446.

[^62]: *Id*. at 13447 -- 48.

[^63]: 47 C.F.R. § 101.603(b)(3).

[^64]: Hughes Electronic Corporation, Petition for Partial
    Reconsideration (filed Oct. 6, 2000).

[^65]: Fixed Wireless Comunication Coalition, Petition for
    Reconsideration (filed Oct. 10, 2000).

[^66]: Winstar Communications, Inc., Petition for Clarification and
    Reconsideration (filed Oct. 10, 2000).

[^67]: *Redesignation of the 17.7-19.7 GHz Frequency Band, Blanket
    Licensing of Satellite Earth Stations in the 17.7-20.2 GHz and
    27.5-30.0 GHz Frequency Bands, and the Allocation of Additional
    Spectrum in the 17.3-17.8 GHz and 24.75-25.25 GHz Frequency Bands
    for Broadcast Satellite Service Use,* 16 FCC Rcd 19808 (2001).

[^68]: *Id*. at 19816.

[^69]: *Id*. If we ultimately decide that PCOs are no longer co-primary
    operations in the sub-band from 18.30 to 18.58 GHz, the spectrum
    available to PCOs for video distribution as OFS licensees in the 18
    GHz band would be reduced by 64 percent. We note, however, that by
    making PCOs eligible to hold CARS licenses, they will have access to
    the full 18 GHz CARS spectrum from 17.70 to 18.58 GHz, as currently
    allocated, or 17.70 to 18.3 GHz under the Hughes relocation
    proposal. PCOs and other NMVPDs will now have access to 880 MHz, or
    at least 600 MHz depending on the decision on reconsideration, in
    the 18 GHz spectrum rather than the 438 MHz they currently use. Any
    use of 18 GHz below 18.142 GHz for video distribution by PCOs and
    other NMVPDs, however, may entail replacement of existing equipment
    or acquisition of additional equipment The cost or compensation for
    any relocation will be addressed in the reconsideration of the *18
    GHz Redesignation Order* should we decide to reallocate the sub-band
    from 18.30 to 18.58 GHz. We do not know whether equipment currently
    used by PCOs can be readily or inexpensively modified for operation
    elsewhere in the 18 GHz band.

[^70]: *NPRM*, 14 FCC Rcd at 11972.

[^71]: NAB Comments at 1; Walt Disney Co. Comments at 1; SBE Comments at
    2.

[^72]: "Contribution Quality" is higher quality video than that
    transmitted to viewers. It is edited, repackaged and other wise
    processed for inclusion in the ultimate video output of a station.
    NAB Comments at n.9.

[^73]: NAB Comments at 5 -- 6.

[^74]: NAB Comments at 5, SBE Comments at 3.

[^75]: Walt Disney Co. Comments at 2.

[^76]: NAB Comments at 6.

[^77]: 47 U.S.C. § 541(b)(1).

[^78]: *Id*. § 542.

[^79]: *Id*. § 532.

[^80]: *Id*. §§ 534 -- 35.

[^81]: *Id*. § 536.

[^82]: *Id*. §531.

[^83]: *Id*. § 543.

[^84]: *Id*. § 533(f)(1)(B); 47 C.F.R. § 76.504(a).

[^85]: 47 C.F.R. § 76.67.

[^86]: *Id*. § 76.92.

[^87]: *Id*. § 76.151.

[^88]: RCN Comments at 9.

[^89]: *Id*.

[^90]: Time Warner Cable Comments at 7-10.

[^91]: *Id.* at 10 (referring to requirements Congress was considering
    for satellite carriers at the time the comments were filed and which
    Congress later imposed.).

[^92]: *See* 47 C.F.R. §§21.900-21.961.

[^93]: *Wireless Cable Order*, 5 FCC Rcd at 6423.

[^94]: *NPRM*, 14 FCC Rcd at 11974.

[^95]: *Id.* at 11975.

[^96]: *See* RCN Comments at 9.

[^97]: *See* NCTA Comments at 2.

[^98]: Sprint Comments at 3.

[^99]: Time Warner Cable Comments at 9.

[^100]: RCN Comments at 11. We note that, if PCO eligibility for 18 GHz
    is revised, reduced or eliminated, it could cause congestion in the
    12 GHz band that would have to be addressed in that context.

[^101]: *See* *id.* at 11 -- 12.

[^102]: Comsearch Comments at 8; NCTA Comments at 3, 5.

[^103]: Time Warner Cable Comments at 17. *See also* Sprint Comments at
    5 (showing of need to transmit over 10 miles would not be necessary
    if NMVPDs were given secondary status).

[^104]: RCN Comments at 16.

[^105]: 47 C.F.R. § 78.108. Operation at reduced power is required for
    paths shorter than the minimum length.

[^106]: NCTA Comments at 5.

[^107]: OpTel Reply Comments at 6.

[^108]: *NPRM*, 14 FCC Rcd at 11979.

[^109]: Sprint Comments at 6.

[^110]: RCN Comments at 15.

[^111]: NCTA Comments at 4; NCTA Reply Comments at 7, Sprint Comments at
    4.

[^112]: 47 C.F.R. § 78.27(b).

[^113]: The Commission has explained that \"a secondary service is
    allowed to use the band as long as its operations do not cause
    interference to any primary designated operations. If a secondary
    service operation causes interference to a primary service, the
    secondary service provider must cease operation \[and\] a service
    designated as primary is the only service given priority status to
    operate in a frequency band. A service designated as co-primary must
    share operations with other services designated as co-primary in the
    frequency band on a co-equal basis.\" *See* *Redesignation of the
    17.7-19.7 GHz Frequency Band, Blanket Licensing of Satellite Earth
    Stations in the 17.7-20.2 GHz and 27.5-30.0 GHz Frequency Bands, and
    the Allocation of Additional Spectrum in the 17.3-17.8 GHz and
    24.75-25.25 GHz Frequency Bands for Broadcast Satellite Service
    Use*, 13 FCC Rcd 19923 at n.4 (1998) (\"*Redesignation NPRM*\"). In
    addition, secondary users must accept interference from primary
    users.

[^114]: NCTA Comments at 5; Sprint Comments at 4; Time Warner Cable
    Comments at 19; Wireless Communications Association, International
    Comments at 1.

[^115]: *See* OpTel Comments at 8; RCN Comments at15.

[^116]: 47 C.F.R. § 78.11(b).

[^117]: *NPRM*, 14 FCC Rcd at n.73.

[^118]: *Id*. at 11979..

[^119]: Sprint Comments at 6 -- 8; OpTel Comments at 9; Wireless
    Communications Association, International Comments at 6.

[^120]: Sprint Comments at 7 -- 8.

[^121]: *Id*.

[^122]: Wireless Communications Association, International Comments at
    6.

[^123]: *Amendment of Parts 21 and 74 to Enable Multipoint Distribution
    Service and Instructional Television Fixed Service Licensees to
    Engage in Fixed Two-Way Transmissions*, 13 FCC Rcd 19112 (1998)
    ("*MDS/ITFS Flexible Use Order*").

[^124]: RCN Comments at 16.

[^125]: 47 C.F.R. § 78.11(b).

[^126]: *NPRM*, 14 FCC Rcd at 11979.

[^127]: *MDS/ITFS Flexible Use Order*, 13 FCC Rcd at 19113.

[^128]: The Commission\'s rules require that a CARS station\'s principal
    use is the transmission of television broadcast material or
    cablecasting. 47 CFR § 78.11(b).

[^129]: Comsearch Comments at 6­7; Sprint Comments at 6­7.

[^130]: Sprint Comments at 7.

[^131]: *NPRM*,14 FCC Rcd at 11973 -- 74.

[^132]: EchoStar Comments at 2.

[^133]: *Id.* at 3.

[^134]: *Id*.

[^135]: *See* *Amendment Of Parts 2 And 25 Of The Commission\'s Rules To
    Permit Operation Of NGSO FSS Systems Co-Frequency With GSO And
    Terrestrial Systems In The Ku-Band Frequency Range; Amendment of the
    Commission's Rules to Authorize Subsidiary Terrestrial Use of the
    12.2-12.7 GHz Band by Direct Broadcast Satellite Licensees and Their
    Affiliates; and Applications of Broadwave USA, PDC Broadband
    Corporation, and Satellite Receivers, Ltd. To Provide a Fixed
    Service in the 12.2-12.7 GHz Band*, 16 FCC Rcd 4096 (2000) ("*MVDDS
    Order")*.

[^136]: SkyBridge Reply Comments at 3-4; OpTel Reply Comments at note
    15.

[^137]: Petition for Consolidation of Rulemaking Proceedings and for a
    Declaratory Ruling That Alternative Spectrum Is Suitable for the
    Proposed "Multichannel Video Distribution Data Service," ET Docket
    No. 98-206, CS Docket No. 99-250, ET Docket No. 00-258 (filed
    December 3, 2001).

[^138]: *Id.* at 5 -- 8.

[^139]: *NPRM*, 14 FCC Rcd at 11978.

[^140]: 47 U.S.C. § 303(y)(2).

[^141]: *NPRM*, 14 FCC Rcd at 11978-79.

[^142]: *Principles for Reallocation of Spectrum to Encourage the
    Development of Telecommunication Technologies for the New
    Millenium*, 14 FCC Rcd 19868, 19870 (1999) \[*Spectrum Policy
    Statement*\].

[^143]: *Principles for Promoting the Efficient Use of Spectrum By
    Encouraging the Development of Secondary Markets*, FCC 00-401, para.
    10; 22 Communications Reg. (P&F) 791, 2000 WL 1760080 (F.C.C.)
    (2000) (*Secondary Markets Policy Statement*).

[^144]: Comsearch Comments at 8; Sprint Comments at 5; Time Warner Cable
    Comments at 19; OpTel Comments 9; RCN Comments at12; SBE Comments at
    5; Wireless Communications Association, International Comments at 1.
    EchoStar would have us auction the spectrum, but only after
    reallocating it for satellite use. EchoStar Comments at 3.

[^145]: Comsearch Reply Comments at 2. *See also* Comments of SkyBridge
    at 2 ("So long as such links are subject to the standard
    coordination procedures used to coordinate terrestrial facilities
    and satellite earth stations . . . .").

[^146]: *See* 5 U.S.C. § 603.

[^147]: *See* *id.* § 604.

[^148]: *See* 5 U.S.C. § 603. The RFA, *see* 5 U.S.C. § 601 -- 612, has
    been amended by the Small Business Regulatory Enforcement Fairness
    Act of 1996 (SBREFA), Pub. L. No. 104-121, Title II, 110 Stat. 857
    (1996).

[^149]: NPRM, 14 FCC Rcd 11967, 11979 (1999).

[^150]: *See* 5 U.S.C. § 604.

[^151]: SBE Comments at 5.

[^152]: NPRM, 14 FCC Rcd at 11980.

[^153]: NPRM, 14 FCC Rcd at 11971.

[^154]: 5 U.S.C. § 604(a)(3).

[^155]: *Id*. § 601(3)(incorporating by reference the definition of
    "small business concern" in 15 U.S.C. § 632.) Pursuant to the RFA,
    the statutory definition of a small business applies, "unless an
    agency, after consultation with the Office of Advocacy of the SBA
    and after opportunity for public comment, establishes one or more
    definitions of such term which are appropriate to the activities of
    the agency and publishes such definition(s) in the Federal Register.

[^156]: 15 U.S.C. § 632.

[^157]: 5 U.S.C. § 601(4).

[^158]: 1992 Economic Census, U.S. Bureau of the Census, Table 6
    (special tabulation of data under contract to Office of Advocacy of
    the U.S. Small Business Administration).

[^159]: 47 C.F.R. § 1.1162.

[^160]: 5 U.S.C. § 601(5).

[^161]: U.S. Dept. of Commerce, Bureau of the Census, "1992 Census of
    Governments."

[^162]: *Id*.

[^163]: 47 C.F.R. §78.13.

[^164]: *See* *id*. §§ 74.600 -- 690.

[^165]: 13 C.F.R. § 121.201

[^166]: Economics and Statistics Administration, Bureau of Census, U.S.
    Department of Commerce, 1992 CENSUS OF TRANSPORTATION,
    COMMUNICATIONS AND UTILITIES, ESTABLISHMENT AND FIRM SIZE, Series
    UC92-S-1, Firm Size 1-123 (1995) ("1992 Census"). *See Memorandum
    Opinion and Order and Notice of Proposed Rule Making*,
    Implementation of Sections of the Cable Telecommunications Consumer
    Protection and Competition Act of 1992, Rate Regulation and Cable
    Pricing Flexibility, MM Docket No. 92-266 and CS Docket No. 96-157,
    11 FCC Rcd 9517, 9531 (1996).

[^167]: 47 C.F.R. § 76.901(e). The Commission developed this definition
    based on its determination that a small cable system operator is one
    with annual revenues of \$100 million or less. *See Sixth* *Report
    and Order and Eleventh Order on Reconsideration*, MM Docket No.
    92-266 and 93-215, 10 FCC Rcd 7393 (1995).

[^168]: Paul Kagan Associates, Inc., *Cable TV Investor*, Feb. 29, 1996
    (based on figures for Dec. 30, 1995).

[^169]: 47 C.F.R. § 76.901(c).

[^170]: 47 U.S.C. § 543(m)(2).

[^171]: 47 C.F.R. § 76.1403(b).

[^172]: Paul Kagan Associates, Inc., Feb.29, 1996 (based on figures for
    Dec. 30, 1995).

[^173]: *Annual Assessment of the Status of Competition in Markets for
    the Delivery of Video Programming, Fourth Annual Report*, 13 FCC Rcd
    1034, 1087 (1998).

[^174]: *Annual Assessment of the Status of Competition in Markets for
    the Delivery of Video programming, Fifth Annual Report*, 13 FCC Rcd
    24284, 24301 (1998).

[^175]: 47 U.S.C. § 21.961(b)(1).

[^176]: *In The Matter of Amendment of Parts 21 and 74 of the
    Commission's Rules With regard to Filing Procedures in the
    Multipoint Distribution Service and in the Instructional Television
    Fixed Service and Implementation of Section 309(j) of the
    Communications Act -- Competitive Bidding*, MM Docket No. 94-31 and
    PP Docket No. 93-253, 10 FCC Rcd 9589 (1995).

[^177]: 47 C.F.R. § 78.69.

[^178]: 5 U.S.C. § 603(c)(1) -- (c)(4).

[^179]: *Id.* §§ 101.601 -- 603.

[^180]: Cable systems have franchising requirements and other
    responsibilities to which they alone are subject. For example, cable
    systems must obtain a franchise, 47 U.S.C. § 541(b)(1), which may
    have a requirement to serve all residents in the franchise area, and
    are subject to a franchise fee. *Id.* § 542. They are also subject
    to regulation regarding leased access; *Id*. § 542; must carry;
    *Id*. §§ 534 -- 5; program access; *Id*. § 536; public, educational,
    and government channels; *Id*. § 531; rate regulation; *Id*. § 543;
    channel occupancy limits; *Id*. 533(f)(1)(B); sports blackout; 47
    C.F.R. § 76.67; network nonduplication; *Id*. § 76.92; and
    syndicated exclusivity, *Id*. § 76.151.