Before the

Federal Communications Commission

Washington, D.C. 20554

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| In the Matter of                 | * | CSR 7086-E                   |
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| Comcast Cable Communications,    | ) |                              |
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| Petition for Determination of    |   |                              |
| Effective Competition in various | * |                              |
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MEMORANDUM OPINION AND ORDER

**Adopted: March 25, 2008 Released: March 26, 2008**

By the Associate Bureau Chief, Media Bureau:

# I. introduction and Background

1.  Comcast Cable Communications, LLC, hereinafter referred to as
    "Petitioner," has filed with the Commission a petition pursuant to
    Sections 76.7, 76.905(b)(2), 76.905(b)(1) and 76.907 of the
    Commission's rules for a determination that Petitioner is subject to
    effective competition in those communities listed on Attachment A
    and hereinafter referred to as "Communities." Petitioner alleges
    that its cable system serving the communities listed on Attachment B
    and hereinafter referred to as Group B Communities is subject to
    effective competition pursuant to Section 623(1) of the
    Communications Act of 1934, as amended ("Communications Act")[^1]
    and the Commission's implementing rules,[^2] and is therefore exempt
    from cable rate regulation in the Communities because of the
    competing service provided by two direct broadcast satellite ("DBS")
    providers, DirecTV, Inc. ("DirecTV") and Dish Network ("Dish").
    Petitioner additionally claims to be exempt from cable rate
    regulation in the communities listed on Attachment C and hereinafter
    referred to as Group C Communities because the Petitioner serves
    fewer than 30 percent of the households in the franchise area. The
    petition is unopposed.

2.  In the absence of a demonstration to the contrary, cable systems are
    presumed not to be subject to effective competition,[^3] as that
    term is defined by Section 623(l) of the Communications Act and
    Section 76.905 of the Commission's rules.[^4] The cable operator
    bears the burden of rebutting the presumption that effective
    competition does not exist with evidence that effective competition
    is present within the relevant franchise area.[^5] For the reasons
    set forth below, we grant the Petition based on our finding that
    Petitioner is subject to effective competition in the Communities
    listed on Attachment A.

# II. DISCUSSION

**A. The Competing Provider Test**

3.  Section 623(l)(1)(B) of the Communications Act provides that a cable
    operator is subject to effective competition if the franchise area
    is (a) served by at least two unaffiliated multi-channel video
    programming distributors ("MVPD") each of which offers comparable
    video programming to at least 50 percent of the households in the
    franchise area; and (b) the number of households subscribing to
    programming services offered by MVPDs other than the largest MVPD
    exceeds 15 percent of the households in the franchise area;[^6] this
    test is otherwise referred to as the "competing provider" test.

4.  The first prong of this test has three elements: the franchise area
    must be "served by" at least two unaffiliated MVPDs who offer
    "comparable programming" to at least "50 percent" of the households
    in the franchise area.[^7]

5.  Turning to the first prong of this test, it is undisputed that these
    Group B Communities are "served by" both DBS providers, DIRECTV and
    Dish, and that these two MVPD providers are unaffiliated with
    Petitioner or with each other. A franchise area is considered
    "served by" an MVPD if that MVPD's service is both technically and
    actually available in the franchise area. DBS service is presumed to
    be technically available due to its nationwide satellite footprint,
    and presumed to be actually available if households in the franchise
    area are made reasonably aware of the service\'s availability.[^8]
    The Commission has held that a party may use evidence of penetration
    rates in the franchise area (the second prong of the competing
    provider test discussed below) coupled with the ubiquity of DBS
    services to show that consumers are reasonably aware of the
    availability of DBS service.[^9] We further find that Petitioner has
    provided sufficient evidence of DBS advertising in local, regional,
    and national media that serve the Group B Communities to support
    their assertion that potential customers in the Group B Communities
    are reasonably aware that they may purchase the service of these
    MVPD providers.[^10] The "comparable programming" element is met if
    a competing MVPD provider offers at least 12 channels of video
    programming, including at least one channel of nonbroadcast service
    programming[^11] and is supported in this petition with copies of
    channel lineups for both DIRECTV and Dish.[^12] Also undisputed is
    Petitioner's assertion that both DIRECTV and Dish offer service to
    at least "50 percent" of the households in the Group B Communities
    because of their national satellite footprint.[^13] Accordingly, we
    find that the first prong of the competing provider test is
    satisfied.

6.  The second prong of the competing provider test requires that the
    number of households subscribing to MVPDs, other than the largest
    MVPD, exceed 15 percent of the households in a franchise area.
    Petitioner asserts that it is the largest MVPD in the Group B
    Communities.[^14] Petitioner sought to determine the competing
    provider penetration in the Group B Communities by purchasing a
    subscriber tracking report from the Satellite Broadcasting and
    Communications Association ("SBCA") that identified the number of
    subscribers attributable to the DBS providers within the Group B
    Communities on a zip code and zip code plus four basis where
    necessary.[^15]

7.  Based upon the aggregate DBS subscriber penetration levels that were
    calculated using Census 2000 household data,[^16] as reflected in
    Attachment B, we find that Petitioner has demonstrated that the
    number of households subscribing to programming services offered by
    MVPDs, other than the largest MVPD, exceeds 15 percent of the
    households in the Group B Communities. Therefore, the second prong
    of the competing provider test is satisfied for each of the Group B
    Communities.

8.  Based on the foregoing, we conclude that Petitioner has submitted
    sufficient evidence demonstrating that both prongs of the competing
    provider test are satisfied and Petitioner is subject to effective
    competition in the Group B Communities.

    **B. The Low Penetration Test**

9.  Section 623(l)(1)(A) of the Communications Act provides that a cable
    operator is subject to effective competition if the Petitioner
    serves fewer than 30 percent of the households in the franchise
    area; this test is otherwise referred to as the "low penetration"
    test.[^17] Petitioner alleges that it is subject to effective
    competition under the low penetration effective competition test
    because it serves less that 30 percent of the households in the
    franchise area.

10. Based upon the subscriber penetration level calculated by
    Petitioner, as reflected in Attachment C, we find that Petitioner
    has demonstrated the percentage of households subscribing to its
    cable service is less than 30 percent of the households in the Group
    C Communities. Therefore, the low penetration test is also satisfied
    as to the Group C Communities.

# III. ordering clauses 

11. Accordingly, **IT IS ORDERED** that the petition for a determination
    of effective competition filed in the captioned proceeding by
    Comcast Cable Communications, LLC **IS GRANTED**.

12. **IT IS FURTHER ORDERED** that the certification to regulate basic
    cable service rates granted to any of the Communities set forth on
    Attachment A **IS REVOKED**.

13. This action is taken pursuant to delegated authority pursuant to
    Section 0.283 of the Commission's rules.[^18]

    FEDERAL COMMUNICATIONS COMMISSION

Nancy Murphy

Associate Bureau Chief, Media Bureau

**ATTACHMENT A**

**CSR 7086-E**

**COMMUNITIES SERVED BY COMCAST CABLE COMMUNICATIONS, LLC**

## Communities CUID(S) 

##  

**Eustis FL0350**

**Fruitland Park FL0064**

**Howey-in-the-Hills FL0720**

**Lake County FL0239**

**FL0879**

**FL1090**

**Leesburg FL0065**

**Montverde FL1089**

**Mount Dora FL0351**

**Sumter County FL1200**

**Tavares FL0352**

**Umatilla FL0616**

**Lady Lake FL0819**

**Marion County FL1201**

**FL1245**

**FL0325**

**FL0554**

**Volusia County FL0265**

**ATTACHMENT B**

**CSR 7086-E**

**COMMUNITIES SERVED BY COMCAST CABLE COMMUNICATIONS, LLC**

**2000 Estimated**

**Census DBS**

## Communities CUID(S) CPR\* Household Subscribers 

##  

##  

**Eustis FL0350 30.04% 6,371 1,914**

**Fruitland Park FL0064 34.56% 1,192 412**

**Howey-in-the-Hills FL0720 78.44% 385 302**

**Lake County Fl0239 41.90% 49,699 20,823**

**FL0879**

**FL1090**

**Leesburg FL0065 26.35% 6,775 1,785**

**Montverde FL1089 66.66% 351 234**

**Mount Dora Fl0351 24.98% 4,123 1,030**

**Sumter County FL1200 48.54% 17,476 8,484**

**Tavares FL0352 29.84% 4,471 1,334**

**Umatilla FL0616 51.90% 867 450**

\*CPR = Percent of competitive DBS penetration rate.

**ATTACHMENT C**

**CSR 7086-E**

**COMMUNITIES SERVED BY COMCAST CABLE COMMUNICATIONS, LLC**

##  Franchise Area Cable Penetration 

## Communities CUID(S) Households Subscribers Percentage 

##  

##  

**Lady Lake FL0819 6,125 899 14.68%**

**Marion County FL1201 85,129 10,151 11.92%**

**FL1245**

**FL0325**

**FL0554**

**Volusia County FL0265 43,406 32 0.07%**

[^1]: *See* 47 U.S.C. § 543(a)(1).

[^2]: 47 C.F.R. § 76.905(b)(2) and 47 C.F.R. § 76.905(b)(1).

[^3]: 47 C.F.R. § 76.906.

[^4]: *See* 47 U.S.C. § 543(l) and 47 C.F.R. § 76.905.

[^5]: *See* 47 C.F.R. §§ 76.906 & 907.

[^6]: 47 U.S.C. § 543(1)(1)(B); *see* also 47 C.F.R. § 76.905(b)(2).

[^7]: 47 C.F.R. § 76.905(b)(2)(i).

[^8]: See Petition at 3.

[^9]: Mediacom Illinois LLC et al., Eleven Petitions for Determination
    of Effective Competition in Twenty-Two Local Franchise Areas in
    Illinois and Michigan*,* [21 FCC Rcd
    1175](http://commreg.pf.com/showSingleDoc.asp?iName=caseIndex&docID=DA-06-278A1&section=1)
    (2006)*.*

[^10]: 47 C.F.R. § 76.905(e)(2).

[^11]: *See* 47 C.F.R. § 76.905(g). *See also* Petition at 4.

[^12]: *See* Petition at 4 and Exhibit 3.

[^13]: *See* Petition at 3.

[^14]: *Id.* at 6. In three Communities (Howey-in-the-Hills, Monteverde,
    and Umatilla), both the Comcast penetration figure and the aggregate
    DBS penetration figure clearly exceed 15 percent. Comcast argues
    that it is subject to effective competition because in addition to
    DBS penetration exceeding 15 percent of the occupied households, the
    number of Comcast subscribers also exceed 15 percent and the
    Commission has recognized that in such cases the second prong of the
    competing provider test is satisfied.

[^15]: Petition at 6-7.

[^16]: Petition at 8.

[^17]: 47 U.S.C. § 543(l)(1)(A).

[^18]: 47 C.F.R. § 0.283.