61016 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

ENVIRONMENTAL PROTECTION

AGENCY

40 CFR Part 52

[VA–5029a; FRL–5921–4]

Approval and Promulgation of Air

Quality Implementation Plans; Virginia;

Approval of VOC RACT Determinations

for Individual Sources; Correction

AGENCY: Environmental Protection

Agency (EPA).

ACTION: Direct final rule; corrections.

SUMMARY: This document corrects the

preamble to a direct final rule published

in the Federal Register of October 14,

1997 regarding the approval of

Reasonably Available Control

Technology (RACT) for six major

sources of volatile organic compounds

(VOC) located in Virginia. The

document contains an incorrect annual

emission rate and a typographical error.

DATES: Effective November 28, 1997.

FOR FURTHER INFORMATION CONTACT:

Kimberly Peck, (215) 566–2165.

SUPPLEMENTARY INFORMATION: In direct

final rule FRL–5904–3, beginning on

page 53243 in the Federal Register issue

of October 14, 1997, make the following

corrections, in the Preamble section. On

page 53243 in the middle column,

change the second full paragraph to the

following:

‘‘The uncontrolled stack VOC

emissions from the Bermuda Hundred

Facility are estimated to be 93.4 tons per

year.’’

On page 53243 in the middle column,

change the third full paragraph to the

following:

‘‘RACT as prescribed in the Consent

Agreement, Registration Number 50722,

dated March 26, 1997 is determined to

be no controls as Virginia determined

that add-on controls were not

economically feasible or cost-effective.’’

Dated: November 3, 1997.

Thomas C. Voltaggio,

Acting Regional Administrator, Region III.

[FR Doc. 97–30020 Filed 11–13–97; 8:45 am]

BILLING CODE 6560–50–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 76

[CS Docket No. 95–184; MM Docket No. 92–

260; FCC 97–376]

Inside Wiring

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: The Commission has adopted

a Report and Order and Second Further

Notice of Proposed Rulemaking which

addresses rules and policies concerning

cable inside wiring. The Second Further

Notice of Proposed Rulemaking segment

of this decision may be found elsewhere

in this issue of the Federal Register. The

Report and Order (‘‘Order’’) segment

amends the Commission’s regulations

relating to the disposition of cable home

wiring and establishes regulations for

the disposition of home run wiring and

related issues including the sharing of

molding, the demarcation point for

multiple dwelling unit buildings

(‘‘MDUs’’), loop-through cable wiring

configurations, customer access to cable

home wiring before termination of

service, and signal leakage. This action

was necessary because competition is

currently being deterred by disputes

over control and use of the wires

necessary to reach each unit in an MDU.

The intended effect of this action is to

expand opportunities for new entrants

seeking to compete in distributing video

programming and to broaden

consumers’ ability to install and

maintain their own wiring.

DATES: Amendments in §§ 76.613,

76.802 and 76.804 contain information

collection requirements, and will not

become effective until approved by the

Office of Management and Budget

(‘‘OMB’’). Amendments in §§ 76.5,

76.620, 76.800, 76.805 and 76.806

become effective December 15, 1997.

However, compliance with amendments

in §§ 76.5, 76.620, 76.800, 76.805 and

76.806 will not be required until OMB

approval of the information collection

requirements in §§ 76.613, 76.802 and

76.804. When approval is received, the

Commission will publish a document

announcing the effective date of the

amendments in §§ 76.613, 76.802 and

76.804, and the date of compliance for

the amendments in §§ 76.5, 76.620,

76.800, 76.805 and 76.806.

Written comments by the public on

the modified information collections are

due on or before January 13, 1998.

ADDRESSES: A copy of any comments on

the information collections contained

herein should be submitted to Judy

Boley, Federal Communications

Commission, Room 234, 1919 M Street,

NW, Washington, DC 20554, or via the

Internet to jboley@fcc.gov.

FOR FURTHER INFORMATION CONTACT: Rick

Chessen, Cable Services Bureau, (202)

418–7200. For additional information

concerning the information collections

contained herein, contact Judy Boley at

202–418–0214, or via the Internet at

jboley@fcc.gov.

Paperwork Reduction Act

The Order contains modified

information collection requirements.

The Federal Communications

Commission, as part of its continuing

effort to reduce paperwork burdens,

invites the general public and other

Federal agencies to take this

opportunity to comment on the

following information collection, as

required by the Paperwork Reduction

Act of 1995, Public Law 104–13.

Comments should address: (a) whether

the proposed collection of information

is necessary for the proper performance

of the functions of the Commission,

including whether the information shall

have practical utility; (b) the accuracy of

the Commission’s burden estimates; (c)

ways to enhance the quality, utility, and

clarity of the information collected; and

(d) ways to minimize the burden of the

collection of information on the

respondents, including the use of

automated collection techniques or

other forms of information technology.

OMB Approval Number: 3060–0692.

Title: Cable Inside Wiring Provisions.

Type of Review: Revision of a

currently approved collection.

Respondents: Individuals; Businesses

or other for-profit entities.

Number of Respondents: 30,500

(20,500 MVPDs and 10,000 MDU

owners).

Estimated Time Per Response: 5

minutes to 30 minutes.

Total Annual Burden to Respondents:

46,114 hours, calculated as follows:

This collection (3060–0692) accounts

for all information collection

requirements that may come into play

during the disposition of cable home

wiring in single dwelling units, as well

as the disposition of home run wiring

and cable home wiring in multiple

dwelling units. All multichannel video

programming distributors (‘‘MVPDs’’),

both cable and non-cable alike, will be

subject to the disposition rules in

MDUs. Pursuant to the Paperwork

Reduction Act, when modifying only

portions of an information collection,

agencies are still obligated to put forth

the entire collection for public

comment.

This information collection also now

accounts for information collection

stated in 47 CFR 76.613, where MVPDs

causing harmful signal interference may

be required by the Commission’s

District Director and/or Resident Agent

to prepare and submit a report regarding

the cause(s) of the interference,

corrective measures planned or taken,

and the efficacy of the remedial

measures. Through the course of this

rulemaking proceeding, the Commission
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61017

has identified this information

collection requirement as not having

previously been reported to OMB for

approval. We estimate that no more than

10 interference reports will be

submitted annually to the Commission’s

District Director and/or Resident Agent,

each having an average burden of 2

hours to prepare. (10 reports × 2 hours

= 20 hours).

47 CFR 76.620 applies the

Commission’s signal leakage rules to all

non-cable MVPDs. Our rules require

that each cable system perform an

independent signal leakage test

annually, therefore, non-cable MVPDs

will now be subject to the same

requirement. We recognize, however,

that immediate compliance with these

requirements may present hardships to

existing non-cable MVPDs not

previously subject to such rules. We

will allow a five-year transition period

from the effective date of these rules to

afford non-cable MVPDs time to comply

with our signal leakage rules other than

§ 76.613. The transition period will

apply only to systems of those non-cable

MVPDs that have been substantially

built as of January 1, 1998. Considering

non-cable MVPD systems that will be

built after January 1, 1998, we estimate

that 500 new entities will be subject to

signal leakage filing requirements, with

an estimated burden of 20 hours per

entity. (500 systems × 20 hours = 10,000

hours). 47 CFR 76.802, Disposition of

Cable Home Wiring, gives individual

video service subscribers in single unit

dwellings and MDUs the opportunity to

purchase their cable home wiring at

replacement cost upon voluntary

termination of service. In calculating

hour burdens for notifying individual

subscribers of their purchase rights, we

make the following assumptions: There

are approximately 20,000 MVPDs

serving approximately 72 million

subscribers in the United States. The

average rate of churn (subscriber

termination) for all MVPDs is estimated

to be 1% per month, or 12% per year.

MVPDs own the home wiring in 50% of

the occurrences of voluntary subscriber

termination and subscribers or property

owners already have gained ownership

of the wiring in the other 50% of

occurrences (e.g., where the MVPD has

charged the subscriber for the wiring

upon installation, has treated the wiring

as belonging to the subscriber for tax

purposes, or where state and/or local

law treats cable home wiring as a

fixture). Where MVPDs own the wiring,

we estimate that they intend to actually

remove the wiring 5% of the time, thus

initiating the disclosure requirement.

We believe in most cases that MVPDs

will choose to abandon the home wiring

because the cost and effort required to

remove the wiring generally outweigh

its value. The burden to disclose the

information at the time of termination

will vary depending on the manner of

disclosure, e.g., by telephone, customer

visit or registered mail. Virtually all

voluntary service terminations are done

by telephone. The estimated average

time consumed in the process of the

MVPD’s disclosure and subscriber’s

election is 5 minutes (.083 hours).

Estimated annual number of

occurrences is 72,000,000 × 12% × 50%

× 5% = 216,000. (216,000 × .083 hours

= 17,928 hours).

In addition, 47 CFR 76.802 states that

if a subscriber in an MDU declines to

purchase the wiring, the MDU owner or

alternative provider (where permitted

by the MDU owner) may purchase the

home wiring where reasonable advance

notice has been provided to the

incumbent. According to the Statistical

Abstracts of the United States, 1995 at

733 Table No. 1224, over 28 million

people resided in MDUs with three or

more units in 1993. We therefore

estimate that there are currently 30

million MDU residents and that MDUs

house an average of 50 residents, and so

we estimate that there are

approximately 600,000 MDUs in the

United States. We estimate that 2,000

MDU owners will provide advance

notice to the incumbent that the MDU

owner or alternative provider (where

permitted by the MDU owner) will

purchase the home wiring where a

terminating individual subscriber

declines. The estimated average time for

MDU owners to provide such notice is

estimated to be 15 minutes (.25 hours).

The estimated average time consumed

in the process of the MVPD’s

subsequent disclosure and the MDU

owner or alternative provider’s election

is 5 minutes (.083 hours). Estimated

annual time consumed is 2,000

notifications × .333 hours = 666 hours.

47 CFR 76.802 also states that, to inform

subscribers of per-foot replacement

costs, MVPDs may develop replacement

cost schedules based on readily

available information; if the MVPD

chooses to develop such schedules, it

must place them in a public file

available for public inspection during

regular business hours. We estimate that

50% of MVPDs will develop such cost

schedules to place in their public files.

Virtually all individual subscribers

terminate service via telephone, and few

subscribers are anticipated to review

cost schedules on public file. The

annual recordkeeping burden for these

cost schedules is estimated to be 0.5

hours per MVPD. (20,000 MVPDs × 50%

× 0.5 hours = 5,000 hours).

47 CFR 76.804 Disposition of Home

Run Wiring. We estimate the burden for

notification and election requirements

for building-by-building and unit-byunit disposition of home run wiring as

described below. Note that these

requirements apply only when an

MVPD owns the home run wiring in an

MDU and does not (or will not at the

conclusion of the notice period) have a

legally enforceable right to remain on

the premises against the wishes of the

entity that owns or controls the common

areas of the MDU or have a legally

enforceable right to maintain any

particular home run wire dedicated to a

particular unit on the premises against

the MDU owner’s wishes. We use the

term ‘‘MDU owner’’ to include whatever

entity owns or controls the common

areas of an apartment building,

condominium or cooperative. For

building-by-building disposition of

home run wiring, the MDU owner gives

the incumbent service provider a

minimum of 90 days’ written notice that

its access to the entire building will be

terminated. The incumbent then has 30

days to elect what it will do with the

home run wiring. Where parties

negotiate a price for the wiring and are

unable to agree on a price, the

incumbent service provider must elect

among abandonment, removal of the

wiring, or arbitration for a price

determination. Also, regarding cable

home wiring, when the MDU owner

notifies the incumbent service provider

that its access to the building will be

terminated, the incumbent provider

must, within 30 days of the initial

notice and in accordance with our home

wiring rules, (1) offer to sell to the MDU

owner any home wiring within the

individual dwelling units which the

incumbent provider owns and intends

to remove, and (2) provide the MDU

owner with the total per-foot

replacement cost of such home wiring.

The MDU owner must then notify the

incumbent provider as to whether the

MDU owner or an alternative provider

intends to purchase the home wiring not

later than 30 days before the

incumbent’s access to the building will

be terminated.

For unit-by-unit disposition of home

run wiring, an MDU owner must

provide at least 60 days’ written notice

to the incumbent MVPD that it intends

to permit multiple MVPDs to compete

for the right to use the individual home

run wires dedicated to each unit. The

incumbent service provider then has 30

days to provide the MDU owner with a

written election as to whether, for all of

the incumbent’s home run wires
61018 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

dedicated to individual subscribers who

may later choose the alternative

provider’s service, it will remove the

wiring, abandon the wiring, or sell the

wiring to the MDU owner. In other

words, the incumbent service provider

will be required to make a single

election for how it will handle the

disposition of individual home run

wires whenever a subscriber wishes to

switch service providers; that election

will then be implemented each time an

individual subscriber switches service

providers. Where parties negotiate a

price for the wiring and are unable to

agree on a price, the incumbent service

provider must elect among

abandonment, removal of the wiring, or

arbitration for a price determination.

The MDU owner also must provide

reasonable advance notice to the

incumbent provider that it will

purchase, or that it will allow an

alternative provider to purchase, the

cable home wiring when a terminating

individual subscriber declines. If the

alternative provider is permitted to

purchase the wiring, it will be required

to make a similar election during the

initial 30-day notice period for each

subscriber who switches back from the

alternative provider to the incumbent

MVPD.

According to the Statistical Abstracts

of the United States, 1995 at 733 Table

No. 1224, over 28 million people

resided in MDUs with three or more

units in 1993. We therefore estimate that

there are currently 30 million MDU

residents and that MDUs house an

average of 50 residents, and so we

estimate that there are approximately

600,000 MDUs in the United States. In

many instances, incumbent service

providers may no longer own the home

run wiring or may continue to have a

legally enforceable right to remain on

the premises. Also, MDU owners may

forego the notice and election processes

for various other reasons, e.g., they have

no interest in purchasing the home run

or cable home wiring. We estimate that

there will be approximately 12,500

notices and 12,500 elections made on an

annual basis. The number of notices

accounts for the occasions when the

MDU owner simultaneously notifies the

incumbent provider that: (1) It is

invoking the home run wiring

disposition procedures, and (2) whether

the MDU owner or alternative provider

intends to purchase the cable home

wiring. It also accounts for those

occasions when the MDU owner makes

a separate notification regarding the

purchase of cable home wiring. The

number of elections accounts for

instances when the incumbent elects to

sell the wiring but the parties are unable

to agree on a price, therefore

necessitating a second election. We

assume all notifications and elections

(except when an individual subscriber

is terminating service) will be in writing

and take an average burden of 30

minutes (0.5 hours) to prepare. (25,000

notifications and elections × 0.5 hours =

12,500 hours).

Total Annual Cost to Respondents:

$37,510, estimated as follows: Under the

annual operation and maintenance costs

category, we estimate that stationery

and postage costs for interference

reports submitted to the Commission

pursuant to § 76.613 to be $1 per report.

(10 reports × $1 = $10). We estimate

stationery and postage costs for signal

leakage filings to be $1 per filing. (500

filings × $1 = $500). We estimate that

50% of the 20,000 MVPDs will annually

develop cost schedules. We estimate

recordkeeping expenses for these

schedules to be $1 per MVPD. (20,000

× 50% × $1 = $10,000). We estimate

stationery and postage costs for the

various disposition notifications and

elections to be $1 per occurrence.

(27,000 notifications and elections × $1

= $27,000). There are no estimated

capital and start-up costs.

Needs and Uses: The various

notification and election requirements

in this collection (3060–0692) are set

forth in order to promote competition

and consumer choice by minimizing

any potential disruption in service to a

subscriber switching video providers.

SUPPLEMENTARY INFORMATION: The

following is a synopsis of the

Commission’s Report and Order in CS

Docket No. 95–184 and MM Docket No.

92–260, FCC No. 97–376, adopted

October 9, 1997 and released October

17, 1997. The full text of this decision

is available for inspection and copying

during normal business hours in the

FCC Reference Center (Room 239), 1919

M Street, NW, Washington, DC 20554,

and may be purchased from the

Commission’s copy contractor,

International Transcription Services,

Inc. (202) 857–3800 (phone), (202) 857–

3805 (fax), 1231 20th Street, NW,

Washington, DC 20036.

Synopsis

I. Introduction

The Order addresses the issues raised

in the Notice of Proposed Rulemaking in

CS Docket No. 95–184, 61 FR 3657

(February 1, 1996) (‘‘Inside Wiring

Notice’’), the Order On Reconsideration

and Further Notice of Proposed

Rulemaking in MM Docket No. 92–260,

61 FR 6131 (February 16, 1996) and 61

FR 6210 (February 16, 1996) (‘‘Cable

Home Wiring Further Notice’’), and the

Further Notice of Proposed Rulemaking

in CS Docket No. 95–184 and MM

Docket No. 92–260, 62 FR 46453

(September 3, 1997) (‘‘Inside Wiring

Further Notice’’) regarding potential

changes in our telephone and cable

inside wiring rules in light of the

evolving telecommunications

marketplace.

II. Disposition of Home Run Wiring

1. We believe that one of the primary

competitive problems in MDUs is the

difficulty for some service providers to

obtain access to the property for the

purpose of running additional home run

wires to subscribers’ units. Home run

wiring is defined as the wiring from the

point at which it becomes dedicated to

an individual unit in an MDU to the

cable demarcation point. The record

indicates that MDU property owners

often object to the installation of

multiple home run wires in the

hallways of their properties, for reasons

including aesthetics, space limitations,

the avoidance of disruption and

inconvenience, and the potential for

property damage. Incumbents often

refuse to sell the home run wiring to the

new provider or to cooperate in any

transition. The result, regardless of the

cable operators’ motives, is to chill the

competitive environment.

2. In the Order, we establish

procedures for building-by-building

disposition of the home run wiring

(where the MDU owner decides to

convert the entire building to a new

video service provider) and for unit-byunit disposition of the home run wiring

(where an MDU owner is willing to

permit two or more video service

providers to compete for subscribers on

a unit-by-unit basis) where the MDU

owner wants the alternative provider to

be able to use the existing home run

wiring. We believe that our procedural

mechanisms will not create or destroy

any property rights, but will promote

competition and consumer choice by

bringing order and certainty to the

disposition of the MDU home run

wiring upon termination of service. We

clarify that riser cable is not covered by

the following procedures.

A. Building-by-Building Procedures

3. We adopt the following procedures

for building-by-building disposition of

home run wiring. Where the incumbent

service provider owns the home run

wiring in an MDU and does not (or will

not at the conclusion of the notice

period) have a legally enforceable right

to remain on the premises, and the MDU

owner wants to be able to use the

existing home run wiring for service
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61019

from another provider, the MDU owner

may give the incumbent service

provider a minimum of 90 days’ written

notice that the provider’s access to the

entire building will be terminated. By

adopting this procedural mechanism,

we do not intend to affect any

contractual rights the parties may have

to terminate service in a different

manner. We believe that it is reasonable

to require, and thus our rules will

require, that MDU owners that wish to

avail themselves of these procedures

notify the incumbent providers of

termination of service for the entire

building in writing. The incumbent

provider will have 30 days to notify the

MDU owner in writing of its election to

do one of the following for all the home

run wiring inside the MDU: (1) to

remove the wiring and restore the MDU

consistent with state law within 30 days

of the end of the 90-day notice period

or within 30 days of actual service

termination, whichever occurs first; (2)

to abandon and not disable the wiring

at the end of the 90-day notice period;

or (3) to sell the wiring to the MDU

owner. If the MDU owner refuses to

purchase the home run wiring, the MDU

owner may permit the alternative video

service provider to purchase it. If the

incumbent provider elects to remove or

abandon the wiring, and it intends to

terminate service before the end of the

90-day notice period, the incumbent

provider will be required to notify the

MDU owner at the time of this election

of the date on which it intends to

terminate service.

4. If the incumbent elects to abandon

the wiring, its ownership will be

determined as a matter of state law.

Passive devices such as splitters, as in

the cable home wiring context, will be

considered part of the home run wiring

for this purpose. While the operator may

remove its amplifiers or other active

devices used in the wiring, it may do so

only if an equivalent replacement can

easily be reattached. Our decision in

this proceeding assumes adherence to

standards of good faith that are

necessary elements of an orderly

transition. In addition, we will require

the party removing any active elements

to comply with the notice requirements

and other rules regarding the removal of

home run wiring. Although we will not

require that incumbents must transfer or

relinquish all rights in molding or

conduit when they sell, remove or

abandon their wiring, we will prohibit

incumbent providers from using any

ownership interests they may have in

property located on or near the home

run wiring, such as molding or conduit,

to prevent, impede or in any way

interfere with the ability of an

alternative MVPD to use the home run

wiring.

5. Where the incumbent provider

elects to sell the home run wiring, we

will allow the parties to negotiate the

price of the wiring. We believe that

market forces will provide adequate

incentives for the parties to reach a

reasonable price, particularly in these

circumstances where the incumbent has

no legally enforceable right to remain on

the premises. The parties will have 30

days from the date of the incumbent’s

election to negotiate a price for the

home run wiring. The parties may also

negotiate to purchase additional wiring

(e.g., riser cables) at their option. As

stated above, our procedures do not

apply to riser cable in that the

incumbent provider is not required to

sell, remove or abandon its riser cable,

but it does have the option of doing so

if all parties agree. If the parties are

unable to agree on a price, the

incumbent will then be required to

elect: (1) to abandon without disabling

the wiring; (2) to remove the wiring and

restore the MDU consistent with state

law; or (3) to submit the price

determination to binding arbitration by

an independent expert. If the incumbent

fails to comply with any of the

deadlines established herein, it will be

deemed to have elected to abandon its

home run wiring at the end of the 90-

day notice period. If the incumbent

service provider elects to abandon its

wiring at this point, the abandonment

will become effective at the end of the

90-day notice period or upon service

termination, whichever occurs first.

Similarly, if the incumbent elects at this

point to remove its wiring and restore

the building consistent with state law, it

will have to do so within 30 days of the

end of the 90-day notice period or

within 30 days of actual service

termination, whichever occurs first.

6. At this time we decline to establish

a penalty for an incumbent provider that

fails to remove wiring after electing to

do so, or, for that matter, for any other

party that violates our cable inside

wiring rules. We expect all parties

participating in the procedures for the

disposition of home run wiring to

cooperate and act in full compliance

with our rules and the policies

underlying them. Similarly, at this time

we will not require the incumbent to

post a performance bond prior to

removal. There is not sufficient

evidence to conclude that a significant

problem will exist, or that MDU owners

are unable to protect their interests

pursuant to contract or state law.

7. If the incumbent chooses to

abandon or remove its wiring, it must

notify the MDU owner at the time of this

election if and when it intends to

terminate service before the end of the

90-day notice period. In addition to this

and other notice requirements, we will

adopt a general rule requiring the

parties to cooperate to avoid service

disruption to subscribers to the extent

possible. One of our overriding goals in

this proceeding is to ensure as seamless

a transition as possible. Our rules are

premised on the good faith cooperation

of all parties to protect against such

disruption. We expect service providers

to cooperate and to make all necessary

efforts to minimize any service

disruption when a transition is

undertaken. We believe that the current

notification requirements, in

conjunction with a general rule

requiring a seamless transition, are

sufficient to protect subscribers from

lengthy service disruptions when

switching providers. We therefore will

not require incumbents to continue

service until the new provider is

connected.

8. If the parties are unable to agree on

a price and the incumbent elects to

submit to binding arbitration, the parties

will have seven days to agree on an

independent expert or to each designate

an expert who will pick a third expert

within an additional seven days. The

independent expert chosen will be

required to assess a reasonable price for

the home run wiring by the end of the

90-day notice period. If the incumbent

elects to submit the matter to binding

arbitration and the MDU owner (or, in

some cases, the alternative provider)

refuses to participate, the incumbent

will have no further obligations under

our home run wiring disposition

procedures.

B. Unit-by-Unit Procedures

9. We adopt the following procedures

for unit-by-unit disposition of home run

wiring. Where the incumbent video

service provider owns the home run

wiring in an MDU and does not (or will

not at the conclusion of the notice

period) have a legally enforceable right

to maintain its home run wiring on the

premises, the MDU owner may permit

multiple service providers to compete

head-to-head in the building for the

right to use the individual home run

wires dedicated to each unit. Where an

MDU owner wishes to permit such

head-to-head competition, the MDU

owner must provide at least 60 days’

written notice to the incumbent

provider of the owner’s intention to

invoke the following procedure. The

incumbent service provider will then

have 30 days to provide the MDU owner

with a written election as to whether,
61020 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

for all of the incumbent’s home run

wires dedicated to individual

subscribers who may later choose the

alternative provider’s service, it will: (1)

remove the wiring and restore the MDU

consistent with state law; (2) abandon

the wiring without disabling it (as in the

building-by-building situation, if the

incumbent elects to abandon the wiring,

its ownership will be determined by

state law, and passive devices will be

considered part of the home run wiring);

or (3) sell the wiring to the MDU owner

(as in the building-by-building situation,

the MDU owner may permit the

alternative provider to purchase the

home run wiring if the MDU owner

refuses to purchase it). In other words,

the incumbent service provider will be

required to make a single election for

how it will handle the disposition of

individual home run wires whenever a

subscriber wishes to switch video

service providers; that election will then

be implemented each time an individual

subscriber switches service providers.

As in the context of building-bybuilding dispositions of home run

wiring, incumbent providers will be

prohibited from using any ownership

interests they may have in property on

or near the home run wiring, such as

molding or conduit, to prevent, impede,

or in any way interfere with the ability

of an alternative MVPD to use the home

run wiring. If the MDU owner permits

the alternative service provider to

purchase the home run wiring, the

alternative service provider will be

required to make a similar election

within this same 30-day period for any

home run wiring that the alternative

provider subsequently owns (i.e., after

the alternative provider has purchased

the wiring from the current incumbent

provider) and that is solely dedicated to

a subscriber who switches back from the

alternative provider to the incumbent.

10. We continue to believe that it

would streamline and expedite the

process of changing service providers if

alternative service providers and MDU

owners were permitted to act as

subscribers’ agents in providing notice

of a subscriber’s desire to change

services. However, consistent with our

intention not to ‘‘create or destroy any

property rights’’ by these procedures,

we will not create any new right of

MDU owners and alternative providers

to act on behalf of subscribers in

terminating service. Nor will we restrict

the rights of such MDU owners and

alternative providers under state law.

We therefore decline at this time to

adopt specific procedures to guard

against unauthorized changes in service,

i.e., ‘‘slamming.’’ (‘‘Slamming’’ is the

unauthorized change of a consumer’s

chosen long distance service. We use

the term more generically here to mean

an unauthorized change in any

communications service.)

11. As with the proposed building-bybuilding procedures, we will permit the

parties to negotiate for the sale of the

home run wiring. If one or both of the

video service providers elects to

negotiate for the sale of the home run

wiring it may own, the parties will have

30 days from the date of such election

to reach an agreement. During this 30-

day negotiation period, the incumbent,

the MDU owner and/or the new

provider may also work out

arrangements for an up-front lump sum

payment in lieu of a unit-by-unit

payment. An up-front lump sum

payment would permit either service

provider to use the home run wiring to

provide service to a subscriber without

the administrative burden of paying

separately for each home run wire every

time a subscriber changes providers.

12. If the parties cannot agree on a

price, the provider that has elected to

sell the wiring will be required to elect:

(1) to abandon without disabling the

wiring; (2) to remove the wiring and

restore the MDU consistent with state

law; or (3) to submit the price

determination to binding arbitration by

an independent expert. Again, if the

MDU owner (or, in some cases, the

alternative provider) refuses to submit

the issue to arbitration, the incumbent’s

obligations under our procedures will

cease. If the incumbent fails to comply

with any of the deadlines established

herein, the home run wiring will be

considered abandoned and the

incumbent may not prevent the

alternative provider from using the

home run wiring immediately to

provide service.

13. If the incumbent elects to submit

to binding arbitration, the parties will

have seven days to agree on an

independent expert or each designate an

expert who will pick a third expert

within an additional seven days. The

independent expert chosen would be

required to assess the price for the

wiring within 14 days. We realize that

the expert’s price determination may

not be issued for up to 28 days after the

60-day notice period has expired. If

subscribers wish to switch service

providers during this period, the

procedures set forth below should be

followed, subject to the price

established by the arbitrator. If the MDU

owner (or, in some cases, the alternative

provider) refuses to participate, the

incumbent’s obligations under the

Commission’s home run wiring

procedures will cease.

14. After completion of this initial

process, a provider’s election will be

carried out if and when the provider is

notified either orally or in writing that

a subscriber wishes to terminate service

and that an alternative service provider

intends to use the existing home run

wire to provide service to that particular

subscriber. At that point, a provider that

has elected to remove its home run

wiring will have seven days to do so

and to restore the building consistent

with state law. If the subscriber has

requested service termination more than

seven days in the future, the seven-day

removal period will begin on the date of

actual service termination (and, in any

event, shall end no later than seven days

after the requested date of termination).

15. If the current service provider has

elected to abandon or sell the wiring,

the abandonment or sale will become

effective upon actual service

termination or upon the requested date

of termination, whichever occurs first. If

the incumbent provider intends to

terminate service prior to the end of the

seven-day period, the incumbent will be

required to inform the subscriber or the

subscriber’s agent (whichever is

notifying the incumbent that the

subscriber wishes to terminate service)

at the time of the request for service

termination of the date on which service

will be terminated. In addition, the

incumbent provider must disconnect

the home run wiring from its lockbox

and leave it accessible for the new

provider within 24 hours of actual

service termination.

16. We base the above procedures on

the assumption that the alternative

service provider will have an incentive

to ensure that the incumbent is notified

that the alternative service provider

intends to use the existing home run

wire to provide service. If, however, the

subscriber’s service is simply

terminated without any indication that

a competing service provider wishes to

use the home run wiring, the incumbent

service provider will not be required to

carry out its election to sell, remove or

abandon the home run wiring. This

might occur, for instance, where an

MDU tenant is moving out of the

building. In such cases, we do not

believe that it would be appropriate to

require the incumbent to sell, remove or

abandon the home run wiring when it

might have every reasonable expectation

that the next tenant will request its

service. However, the incumbent

provider will be required to carry out its

election with regard to the home run

wiring if and when it receives notice

from a subsequent tenant (either directly

or through an alternative provider) that
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61021

the tenant wishes to use the home run

wiring to receive a competing service.

17. Where the incumbent receives a

request for service termination but does

not receive notice that an alternative

provider wishes to use the home run

wiring, the incumbent will still be

required to follow the procedures set

forth in our cable home wiring rules—

e.g., to offer to sell to the subscriber any

cable home wiring that the incumbent

provider otherwise intends to remove.

The required notice in the unit-by-unit

context may be effected in two stages

(i.e., the subscriber may call to

terminate service and the alternative

provider may separately notify the

incumbent that it wishes to use the

home run wiring). In order for the home

run wiring and the home wiring to be

disposed of in a coordinated manner,

we believe that our cable home wiring

rules must apply upon any termination

of service. In addition, we believe that

subscribers should have the right to

purchase their home wiring to protect

themselves from unnecessary disruption

associated with removal of home wiring,

regardless of whether they intend to

subscribe to an alternative service.

C. Ownership of Home Run Wiring

18. In both the building-by-building

and unit-by-unit approaches, the MDU

owner will have the initial option to

negotiate for ownership and control of

the home run wiring because the

property owner is responsible for the

common areas of a building, including

safety and security concerns,

compliance with building and electrical

codes, maintaining the aesthetics of the

building and balancing the concerns of

all of the residents. Moreover, vesting

ownership of the home run wiring in

the MDU owner, as opposed to the

alternative service provider, will reduce

future transaction costs since the above

procedures will not need to be repeated

if service is subsequently switched

again. Nevertheless, we recognize that

some MDU owners may not want to

own the home run wiring in their

buildings; in such cases, the MDU

owner may permit the alternative

service provider to purchase the wiring.

19. We will not require video service

providers to transfer ownership of cable

inside wiring to MDU owners upon

installation. At this time, we believe this

issue is best left to marketplace

negotiations between the service

provider and the MDU owner. Some

MDU owners may choose to bargain for

ownership of the inside wiring, while

others may prefer to let the service

provider maintain ownership. We are

not convinced that MDU owners have

insufficient bargaining power in this

situation to protect their interests. Even

under the home run disposition

procedures adopted above, we recognize

that some MDU owners may not wish to

exercise ownership over the inside

wiring. We believe that MDU owners

should have the same option at the time

of installation.

20. We do believe, however, that all

parties involved would benefit from

additional certainty regarding

ownership of the home run wiring upon

termination of a service contract. For

any contracts between MVPDs and MDU

owners entered into after the effective

date of our rules, we will require the

MVPD to include a provision describing

the disposition of the home run wiring

upon the contract’s termination. We

believe that such a rule will provide

certainty to the parties and permit them

to address the disposition of home run

wiring in light of their circumstances.

Where the parties’ contract clearly and

expressly addresses the disposition of

the home run wiring, our procedures

will not apply. We also reiterate that the

parties may rely upon any existing

contractual rights upon termination, in

addition to the procedures we are

adopting.

D. Application of Procedural

Framework

21. As noted above, the procedural

mechanisms we are adopting will apply

only where the incumbent provider no

longer has an enforceable legal right to

maintain its home run wiring on the

premises against the will of the MDU

owner. These procedures will not apply

where the incumbent provider has a

contractual, statutory or common law

right to maintain its home run wiring on

the property. We also reiterate that we

are not preempting any rights the

incumbent provider may have under

state law. In the building-by-building

context, the procedures will not apply

where the incumbent provider has a

legally enforceable right to maintain its

home run wiring on the premises, even

against the MDU owner’s wishes, and to

prevent any third party from using the

wiring. In the unit-by-unit context, the

procedures will not apply where the

incumbent provider has a legally

enforceable right to keep a particular

home run wire dedicated to a particular

unit (not including the wiring on the

subscriber’s side of the demarcation

point) on the premises, even against the

property owner’s wishes.

22. We will adopt a presumption that

the building-by-building and unit-byunit procedural mechanisms will apply

unless and until the incumbent obtains

a court ruling or an injunction enjoining

its displacement during the 45-day

period following the initial notice. The

incumbent will still be required to make

its election to sell, remove or abandon

the wiring by the end of the initial 30-

day period in the absence of such a

ruling or injunction. In light of this rule,

we decline to shorten the initial election

period. We also decline to stay our

procedures until all judicial procedures

are terminated, including all appeals.

We have not received evidence

sufficient to persuade us that state

courts will not respond expeditiously.

Significantly, the record indicates state

courts’ ability to protect incumbents’

rights. The record continues to support

our judgment that an incumbent’s

failure to obtain a state court injunction

justifies a presumption that the

incumbent no longer has an enforceable

legal right to remain on the premises.

We do not believe that this presumption

interferes with the incumbent’s state

law rights. A court applying state law

will continue to be the ultimate arbiter

of whether the incumbent has a legally

enforceable right to remain on the

premises, and possesses the ability to

take any necessary and appropriate

steps to make the parties whole under

state law. Our presumption simply

means that if the incumbent cannot

obtain an injunction to maintain its

home run wiring on the premises, it is

appropriate to permit the MDU owner to

invoke our procedures pending any

further litigation.

23. We will adopt one exception to

our presumption that our procedures

will apply in the absence of a state court

ruling or injunction obtained within 45

days of the initial notice. We will not

require an incumbent provider to obtain

such a ruling or injunction where a

state’s highest court has found that,

under its state mandatory access statute,

the incumbent always has an

enforceable right to maintain its home

run wiring on the premises. We believe

that to require the incumbent to initiate

court proceedings in this situation is

wasteful and unnecessary. In such

cases, we believe that the burden should

shift to the new provider to obtain a

judicial determination to the contrary.

24. We decline, however, to provide

that our procedures do not apply in

states that have enacted mandatory

access statutes. Several parties take

issue with our statement that where the

incumbent provider’s mandatory right

of access is dependent upon a

subscriber’s request for service, the

provider may no longer have a legally

enforceable right to maintain that

subscriber’s home run wiring on the

premises against the MDU owner’s

wishes once the subscriber no longer

requests service. We clarify that we did
61022 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

not intend to and do not now express

any opinion on the merits of this issue.

The enforceability of a state mandatory

access statute is an issue for the state

courts to decide under their particular

statutes. We are unwilling to conclude

that state mandatory access statutes

always grant incumbents the right to

maintain their home run wiring in an

MDU over the MDU owner’s objection.

Similarly, we express no opinion on

whether state mandatory access statutes

permit an incumbent MVPD to block

moldings or conduits with unused

wiring. Contrary to the arguments of

some cable operators, this is not an

issue of the right to install wiring.

Rather, the issue is whether the

incumbent has a legally enforceable

right to maintain its home run wiring on

the premises over the objection of the

MDU owner. Accordingly, our

procedures will apply in mandatory

access states to the extent state law does

not permit the incumbent to maintain

its home run wiring (in the case of a

building-by-building disposition) or a

particular home run wire to a particular

subscriber (in the case of a unit-by-unit

disposition) against the will of the MDU

owner.

25. The above procedural mechanisms

will apply regardless of the identity of

the incumbent video service provider

involved. While initially this incumbent

would commonly be a cable operator, it

could also be a SMATV provider, an

MMDS provider, a DBS provider or

others. We believe that this will ensure

competitive parity among MVPDs and

ensure that MDU owners are able to

benefit from these procedures regardless

of the MVPD that initially wired their

buildings.

III. Sharing of Molding

26. We will permit an alternative

MVPD to install its wiring within an

incumbent’s existing molding, even over

the incumbent provider’s objection,

where the MDU owner agrees that there

is adequate space in the molding and

the MDU owner gives its affirmative

consent. We believe that such a rule will

promote head-to-head competition

among MVPDs by overcoming the

resistance of MDU owners to the

installation of redundant molding. At

this time we will not require the sharing

of space within conduits. However, we

will not apply this rule where the

incumbent has an exclusive contractual

right to occupy the molding. Since we

do not believe that the incumbent

ordinarily will have a property interest

in the vacant air space inside the

hallway molding, we will not require

the alternative MVPD to compensate the

incumbent for the placement of its

wires. The alternative provider will,

however, be required to pay any and all

installation costs, including the costs of

restoring the property to its prior

condition and the costs of any damage

to the incumbent’s wiring or other

property.

27. Under the rule we will adopt,

where the MDU owner does not agree

that there is adequate space in the

molding for the additional wiring, and

the MDU owner is willing to permit the

installation of larger molding that could

contain both the incumbent’s and the

alternative MVPD’s wiring, the MDU

owner (with or without the assistance of

the incumbent and/or the alternative

provider) shall be permitted to remove

the existing molding (and return the

molding to the incumbent, if

appropriate) and replace it with the

larger molding at the alternative

MVPD’s expense. Again, the alternative

MVPD would be required to pay any

and all installation costs, including the

costs of restoring the property to its

prior condition and the costs of any

damage to the incumbent’s wiring or

other property. This rule will not apply

if the incumbent has contracted for the

right to maintain its molding on the

MDU owner’s property without

alteration by the MDU owner. Absent

such a contractual provision, we believe

that the incumbent has no right to

prevent the MDU owner from altering

the molding in its hallways and other

areas of its property.

IV. Disposition of Cable Home Wiring

28. The procedural framework

discussed above addresses the

disposition of MDU home run wiring.

Here, we set forth specific rules on how

to address certain issues regarding the

disposition of MDU cable home wiring

that were not addressed in our prior

home wiring order. Cable home wiring

is defined as the internal wiring

contained within the premises of a

subscriber which begins at the

demarcation point, not including any

active elements such as amplifiers,

converter or decoder boxes, or remote

control units. As in the context of home

run wiring, our MDU home wiring rules

will apply regardless of the identity of

the incumbent video service provider

involved. While initially this incumbent

will commonly be a cable operator, it

could also be a SMATV provider, an

MMDS provider, a DBS provider or

others. We therefore will apply all of

our cable home wiring rules for

multiple-unit installations to all

MVPDs. We also believe that it may be

beneficial to apply our cable home

wiring rules for single-unit installations

to all MVPDs. We seek comment on this

issue in the Second Further Notice of

Proposed Rulemaking, which is

summarized elsewhere in the Federal

Register.

A. Disposition of Home Wiring When

Service is Terminated for an Entire

MDU

29. We conclude that, if the MDU

owner has the legal right, either by law

or by contract, to terminate the

subscriber’s cable service, the owner

terminating service for the entire

building is effectively voluntarily

terminating service on the subscriber’s

behalf, and our home wiring rules

would be triggered. We conclude that

providing the cable operator a single

point of contact (i.e., the MDU owner)

will further the statutory purposes of

minimizing disruption and facilitating

the transfer of service to a competing

video service provider. Because we

believe that it would be impractical and

inefficient for the incumbent provider to

deal with each individual subscriber

regarding the disposition of his or her

cable home wiring when the entire

MDU is switching providers, we will

deem the MDU owner to be acting as the

terminating ‘‘subscriber’’ for purposes of

the disposition of the cable home wiring

within the individual dwelling unit

where the cable home wiring is not

already owned by a resident. We clarify,

however, that we are not changing our

definition of subscriber to include MDU

owners. We believe that, when as a

matter of law or contract, the MDU

owner has the right to terminate service,

the MDU owner is effectively

terminating service on behalf of the

subscriber. Similarly, with regard to

exclusive bulk service contracts, we

conclude that it is logical for the

landlord to be deemed the subscriber,

and thus for the landlord to have the

right to purchase the home wiring as

provided in our general rules.

30. For those MDU owners proceeding

under our home run wiring disposition

procedures, we will adopt the following

framework in order to ensure the

orderly disposition of the home wiring.

When an incumbent provider is notified

under our home run wiring disposition

procedures that the incumbent

provider’s access to the entire building

will be terminated and that the MDU

owner seeks to use the home run wiring

for another service, the incumbent

provider must, within 30 days: (1) offer

to sell to the MDU owner any home

wiring within the individual dwelling

units which the incumbent provider

owns and intends to remove; and (2)

provide the MDU owner with the total

per-foot replacement cost of such home

wiring.
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61023

31. As with the home run wiring, if

an MDU owner declines to purchase the

cable home wiring not already owned

by a resident, the MDU owner may

permit the alternative service provider

to purchase the wiring upon service

termination under our rules. We will

require that the MDU owner decide

whether it or the alternative provider

will purchase the cable home wiring

and so notify the incumbent provider no

later than 30 days before the termination

of access to the building will become

effective. If the MDU owner and the

alternative service provider decline to

purchase the home wiring, the

incumbent provider will not be

permitted to remove the home wiring

until the date of actual service

termination, i.e., likely 90 days after the

building owner notified the incumbent

that its access to the entire building will

be terminated. We will modify our

current home wiring rules to allow the

incumbent provider 30 days after

service termination, rather than the

current seven days, to remove all of the

cable home wiring for the entire

building if the MDU owner has

terminated service for the entire

building and has declined to purchase

the home wiring. We believe this is

appropriate given the amount of home

wiring that may need to be removed

from an entire building. Under these

circumstances, if the incumbent

provider fails to remove the home

wiring within 30 days of actual service

termination, it cannot make any

subsequent attempt to remove the

wiring or restrict its use.

B. Disposition of Home Wiring When

Service Is Terminated by an Individual

Subscriber

32. We will continue to apply our

rules permitting individual terminating

subscribers (or their agents) to purchase

the cable home wiring up to a point at

or about 12 inches outside their

individual units. We continue to believe

that this is consistent with the purposes

of section 624(i) to promote consumer

choice and competition by permitting

subscribers to avoid the disruption of

having their home wiring removed upon

voluntary termination and to

subsequently utilize that wiring for an

alternative service. If the subscriber

declines to purchase its home wiring,

we believe that the premises owner

should be permitted to purchase the

cable home wiring within the

individual’s premises based on the perfoot replacement cost. This approach

will preserve the current subscriber’s

rights, and still allow the premises

owner to act on behalf of future tenants,

thus promoting competition and

consumer choice. As with the home run

wiring in an MDU, if the premises

owner declines to purchase the cable

home wiring, the owner may permit the

alternative service provider to purchase

it.

33. Where an individual MDU

resident terminates service, the MDU

owner must provide reasonable advance

notice to the incumbent provider if it

wishes to purchase the home wiring (or

that the alternative provider will

purchase it) if and when an individual

subscriber declines. The MDU owner

will be required to inform the

incumbent provider one time for the

entire building. If the MDU owner fails

to provide the incumbent with such

notice, the incumbent will be under no

obligation to sell the home wiring to the

MDU owner or the alternative provider

when an individual subscriber

terminates and declines to purchase the

wiring. Where an MDU owner does not

or cannot invoke our unit-by-unit home

run wiring disposition procedures (e.g.,

if it elects to have two-wire competition

to each unit), we will require the MDU

owner to provide the incumbent

provider reasonable advance notice if

the MDU owner or the alternative

provider intends to purchase the home

wiring if and when a subscriber

declines.

34. In addition, where an individual

subscriber is terminating service, we

will change the time in which an

incumbent provider must remove the

home wiring or make no further effort

to use it or restrict its use in single unit

installations from seven business days

to seven calendar days after the

individual subscriber terminates

service. We believe that this minor

change is sufficient time for removal of

a single subscriber’s cable home wiring,

and will avoid customer confusion by

having the time permitted for the

provider to remove the home wiring

within the individual unit run

concurrently with the time permitted for

the provider to remove, sell or abandon

the home run wiring under our

procedural framework.

C. Effect of Subscriber Vacating the

Premises on the Application of Cable

Home Wiring Rules

35. We conclude that our cable home

wiring rules should apply even when

the subscriber terminates cable service,

elects not to purchase the wiring and

vacates the premises within the sevenday time period the operator has to

remove the home wiring. A cable

operator that owns the wiring and

intends to remove it must offer to sell

the cable home wiring to the subscriber

upon voluntary termination, and if the

subscriber declines, the operator must

remove the wiring within seven days or

make no further effort to remove it or

restrict its use. We expressly state that

the cable operator must be given

reasonable access to the individual

premises during the removal period. We

believe that the foregoing policy will

promote the objectives of section 624(i)

by minimizing disruption and

facilitating subsequent subscribers’

ability to use their home wiring to

connect to the video service provider of

their choice.

36. The disposition of the cable home

wiring under these circumstances will

not affect our rules for the unit-by-unit

disposition of the MDU home run

wiring. As described above, our rules

regarding the disposition of the home

run wiring are not triggered where a

subscriber terminates service and

vacates the premises unless and until a

new or subsequent subscriber (or his or

her agent) notifies the incumbent

service provider that the subscriber

wishes to receive service from an

alternative service provider lawfully

serving the premises.

V. MDU Demarcation Point

37. We believe that it is not necessary

to establish a common cable and

telephone demarcation point at this

time. At least as far as inside wiring is

concerned, telephony generally appears

to continue to be delivered over twisted

pair wiring and multichannel video

programming generally appears to be

delivered over coaxial cable. Based on

the record in this proceeding, it appears

that cable operators and other entities

planning to offer telephone service

generally will do so by connecting to the

existing telephone inside wiring

network. The record before us indicates

that this distinction is likely to continue

for at least the near future. If and when

circumstances change, we will revisit

this issue with the goal of creating a

single set of inside wiring rules. We

note that, as a practical matter, the

telephone demarcation point in new

single family home installations may be

located at a point outside of where the

wiring enters the home, near the cable

demarcation point. Similarly, the points

at which the telephone and cable inside

wiring become devoted to individual

multiple dwelling units may be at

similar locations (e.g., in garden-style

apartment buildings, such points may

both be located in the basement of the

individual buildings). While such

examples may create a de facto

convergence in many cases, so long as

the cable and telephone inside wiring

networks remain distinct, we do not
61024 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

believe that the Commission need

require such a result.

38. At this time, we will not modify

the cable demarcation point in MDUs.

We will, however, adopt our tentative

conclusion that where the cable

demarcation point is ‘‘physically

inaccessible’’ to an alternative MVPD,

the demarcation point should be moved

to the point at which it first becomes

physically accessible. We clarify that

this movement should be the closest

point at which the wiring becomes

physically accessible that does not

require access to the subscriber’s unit.

Moving the demarcation point into the

unit in such situations would add

significantly to the disruption and

inconvenience of switching service

providers, contrary to the intent of

section 624(i).

39. In addition, we will adopt a

definition of ‘‘physically inaccessible’’

which asks whether accessing the

demarcation point (1) would require

significant modification or damage of

preexisting structural elements, and (2)

would add significantly to the physical

difficulty and/or cost of accessing the

subscriber’s home wiring. For example,

wiring embedded in brick, metal

conduit or cinder blocks would likely be

‘‘physically inaccessible’’ under this

definition; wiring simply enclosed

within hallway molding would not.

VI. Loop-Through Cable Wiring

Configurations

40. In a loop-through cable wiring

system, a single cable is used to provide

service to either a portion of or an entire

MDU. Every subscriber on the loop is

therefore limited to receiving video

services from the same provider. If the

cable is broken or removed, signals to

all succeeding units are interrupted.

Previously, we excluded MDU loopthrough wiring from the cable home

wiring rules because we believed that

applying our rules to loop-through

wiring would give the initial subscriber

control over cable service for all

subscribers in the loop. Because loopthrough configurations are excluded

from the home wiring rules, cable

operators are not currently required to

offer to sell the wire to subscribers upon

termination of service, and no

subscriber on the loop has the right to

purchase that portion of the loopthrough cable wiring located inside his

or her dwelling unit. The ownership of

loop-through wiring therefore currently

depends on the circumstances (e.g., who

installed the wire, whether the wire has

been sold and state fixture law) and is

not affected by our rules.

41. As with other cable inside wiring

configurations in MDUs, a wiring loop

may include both wiring inside the

individual dwelling unit and wiring in

common areas which extends outside

the individual dwelling unit to the riser

or feeder cable. We now believe that, for

purposes of our cable inside wiring

rules, all loop-through wiring should

not be treated the same. We therefore

conclude that, when the property owner

or the entity that owns or controls the

common areas elects to switch to a new

service provider, our cable home wiring

rules will apply to that portion of the

loop-through wiring that is inside the

individual dwelling unit (up to the

demarcation point(s) discussed below).

For example, when an MDU owner

wishes to terminate service for a

building with loop-through wiring and

invokes our building-by-building

procedures for disposition of the home

run wiring, those procedures will

govern the disposition of the wiring that

is dedicated to each loop other than the

cable home wiring within each unit.

Consistent with our building-bybuilding procedures, the MDU owner

will be permitted to purchase the loopthrough home wiring pursuant to our

cable home wiring rules. In addition,

where the MDU owner terminates

service for the entire loop but does not

or cannot invoke our procedures for the

disposition of home run wiring, the

MDU owner will nevertheless have

certain rights to the home wiring within

the individual dwelling units.

42. Where a building is comprised of

rental units, the building owner will

have the right to elect to switch service

providers and the right to purchase the

loop-through home wiring. In buildings

in which persons have a direct or

indirect ownership interest in

individual units (as with condominiums

and cooperatives), the election of

whether to switch service providers will

be determined under the rules of the

association or entity that owns and

controls the building’s common areas,

in a manner similar to other decisions

made by the entity with respect to the

common areas. If the MDU owner elects

to switch to a new service provider but

does not wish to purchase the loopthrough home wiring, the new service

provider may elect to purchase the

wiring.

43. Allowing the MDU owner to

purchase loop-through home wiring

under these circumstances will allow

that party to control the wiring. We

believe that, at least in competitive

markets, the MDU owner has a

significant incentive to represent the

subscribers’ interests. In addition, the

management structures of condominium

or cooperative buildings are designed to

reflect their residents’ interests.

Allowing the MDU owner to control

loop-through home wiring gives the

subscriber an opportunity for increased

choice and enhanced service, and

furthers section 624(i)’s statutory

purpose of facilitating the transfer to an

alternate service provider with minimal

disruption to the subscriber. We

previously excluded loop-through

wiring from our cable home wiring rules

because we did not believe it was

appropriate to give the initial individual

subscriber in the loop control over the

cable service of all remaining

subscribers on the loop. Under the

procedures we adopt today, that

situation cannot occur.

44. We clarify that our rules will

provide the MDU owner, not the

alternative provider, with the first

opportunity to purchase the loopthrough wiring. Once the MDU owner

owns and controls the wiring, the cable

operator will be on equal footing under

our rules with other video service

providers with regard to subsequently

providing service to the tenants. Only if

the MDU owner declines to purchase

the wiring will the alternative provider

have the opportunity to purchase the

loop-through wiring.

45. We will set the demarcation

points, i.e., the points between which

the MDU owner may purchase the loopthrough home wiring under our cable

home wiring rules, at or about 12 inches

outside the point at which the loop

enters or exits the first and last

individual dwelling units on the loop,

or as close as practicable where 12

inches outside is physically

inaccessible. In some cases, the loop

may begin and end outside of the same

unit, and thus the demarcation points

shall be 12 inches outside the point at

which the loop enters and exits that one

unit, or as close as practicable where 12

inches outside is physically

inaccessible. We believe that this is

consistent with section 624(i), i.e., the

loop-through home wiring is within the

customer’s premises, and with the cable

demarcation point for non-loop-through

configurations. We note that one of our

prior concerns was that establishing a

separate demarcation point for each

subscriber on the loop was not feasible.

Under the rules set forth herein,

however, one entity will be purchasing

the entire home wiring loop, making it

unnecessary to set a demarcation point

for each subscriber’s unit.

46. We will apply the same rules with

respect to compensation and technical

standards that we apply to non-loopthrough wiring systems as well. In other

words, the loop-through wiring on the

subscriber’s side of the demarcation

point may be purchased by the MDU
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61025

owner at the replacement cost as

defined in § 76.802(a). The loop-through

wiring outside the demarcation points

up to the point at which the loop

connects with the riser or feeder cable

may be addressed pursuant to the

procedures set forth above with regard

to the disposition of home run wiring.

47. Despite the competitive

drawbacks of loop-through wiring, we

do not believe it necessary for the

Commission to prohibit future

installations of loop-through wiring

configurations. We believe that such a

prohibition would unduly restrict the

configuration options available to

building owners and service providers.

We have found no evidence in the

record that cable operators have

installed loop-through wiring in order to

evade our rules since they were

implemented in 1993. Also, the

application of our home wiring rules to

loop-through systems where the MDU

owner seeks to switch service providers

should reduce any incentive cable

operators may have to install loopthrough configurations for anticompetitive reasons.

VII. Video Service Provider Access to

Private Property

A. Federal Mandatory Access

Requirements

48. While we believe that

nondiscriminatory access for video and

telephony service providers enhances

competition, we will not adopt a federal

mandatory access requirement at this

time. We note that telecommunications

carriers’ access to telephone companies’

facilities and rights-of-way under the

1996 Act are currently under

reconsideration in First Report and

Order in CC Docket No. 96–98 and CC

Docket No. 95–185 (‘‘Interconnection

Order’’). We do not believe that the

record in this proceeding provides a

sufficient basis for us to address these

issues. We will defer decisions on these

issues to that proceeding. Similarly, we

do not decide herein whether under

section 207 of the 1996 Act viewers

living in rental properties, and those

who need access to common property,

have the right to receive certain video

programming services over the property

owner’s objections. This issue will be

addressed in IB Docket No. 95–59

(Preemption of Local Zoning Regulation

of Satellite Earth Stations) and CS

Docket No. 96–83 (Implementation of

section 207 of the Telecommunications

Act, Restrictions on Over-the-Air

Devices: Television Broadcast Service

and Multichannel Multipoint

Distribution Service).

49. In addition, commenters in this

proceeding urged the Commission to

construe section 621(a)(2) to prohibit a

property owner from denying a

franchised cable operator access to an

easement on the property when the

owner has already granted or is

obligated to grant an easement to other

utilities, whether public or private.

Section 621(a)(2) provides that ‘‘[a]ny

franchise shall be construed to authorize

the construction of a cable system over

public rights-of-way, and through

easements, which is within the area to

be served by the cable system and

which have been dedicated for

compatible uses * * *.’’ Numerous

court decisions have interpreted the

statutory language and legislative

history of section 621(a)(2), several

finding that this section does not

provide cable operators access to purely

private easements granted to utilities.

We decline to address those rulings

here, but will continue to examine these

issues as we seek to ensure parity of

access among all telecommunications

and video services providers. Similarly,

we decline at this time to adopt a

mandatory access rule under section

706 of the 1996 Act, but may revisit this

issue as we consider issues of service

provider access in the broader

competitive context.

50. We believe that whether an

incumbent provider may use its existing

easements or rights-of-way to provide

new or additional services generally

depends on state law interpretations of

the terms of the easements or rights-ofway. While we decline at this time to

decide as a general matter whether such

easements and rights-of-way permit the

provision of additional services, we

believe that we do have the authority in

certain instances to review restrictions

imposed upon such use.

B. State Cable Mandatory Access

Requirements

51. According to the record in this

proceeding, some form of mandatory

access law may exist in approximately

18 jurisdictions, including Connecticut,

Delaware, the District of Columbia,

Florida, Illinois, Iowa, Kansas, Maine,

Massachusetts, Minnesota, Nevada, New

Jersey, New York, Ohio, Pennsylvania,

Rhode Island, West Virginia and

Wisconsin. The record also indicates

that there may be local ordinances that

provide similar access rights. We

believe that the record in this

proceeding does not support the

preemption of state mandatory access

laws at this time. While commenters

opposing state mandatory access laws

argue that these laws act as a barrier to

entry, the record also indicates that

property owners deny access for reasons

unrelated to the state laws, including

property damage, aesthetic

considerations and space limitations.

We believe that our rules regarding the

building-by-building and unit-by-unit

disposition of home run wiring adopted

herein will lower many of these barriers

to entry and may alleviate some of the

advantages incumbent providers may

have with respect to providing service

to particular buildings.

52. We remain concerned, however,

about disparate regulation of MVPDs

that unfairly skews competition in the

multichannel video programming

marketplace. Despite our decision not to

preempt state and local mandatory

access laws at this time, we encourage

these jurisdictions to evaluate present

laws and circumstances to determine

whether a nondiscriminatory and

competitively neutral environment

exists. We believe that establishing

competitive parity under these statutes

will promote competition among

MVPDs and will expand consumer

choice.

C. Exclusive Service Contracts

53. We recognize that there are

significant competitive issues regarding

exclusive contracts. We are concerned

that long-term exclusive contracts may

raise anti-competitive concerns because

they ‘‘lock up’’ properties, preventing

consumers from receiving the benefits of

a newly competitive market. However,

we also note that alternative providers

cite the competitive benefits of

exclusive contracts as a means of

financing ‘‘specialized investments.’’

Without exclusive contracts to allow

recovery over time on the cost of new

installation, these parties assert that

they will be unable to compete with the

incumbent cable operator. We believe

that the record would benefit from

further comment on these issues. In the

Second Further Notice of Proposed

Rulemaking, summarized elsewhere in

the Federal Register, we seek comment

on various options, including: (1)

adopting a maximum ‘‘cap’’ on the

enforceability of all MVPDs’ exclusive

contracts; (2) limiting the ability of

MVPDs with market power from

entering into exclusive contracts; and

(3) adopting a ‘‘fresh look’’ period for

so-called ‘‘perpetual’’ exclusive

contracts.

VIII. Customer Access to Cable Home

Wiring Before Termination of Service

54. We will establish a rule allowing

customers to provide and install their

own cable home wiring within their

premises, and to connect additional

home wiring within their premises to
61026 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

the wiring installed and owned by the

cable operator prior to termination of

service. Under this rule, customers will

be able to select who will install their

home wiring (e.g., themselves, the cable

operator or a commercial contractor). In

addition, customers may connect

additional wiring, splitters or other

equipment to the cable operator’s

wiring, or redirect or reroute the home

wiring, so long as no electronic or

physical harm is caused to the cable

system and the physical integrity of the

cable operator’s wiring remains intact.

Subscribers will not be permitted to

physically cut, improperly terminate,

substantially alter or otherwise destroy

cable operator-owned inside wiring. To

protect cable operators’ systems from

signal leakage, electronic and physical

harm and other types of degradation, we

will permit cable operators to require

that any home wiring (including any

passive splitters, connectors and other

equipment used in the installation of

home wiring) meets reasonable

technical specifications, not to exceed

the technical specifications of such

equipment installed by the cable

operator. If, however, the subscriber’s

connection to, redirection of or

rerouting of the home wiring causes

electronic or physical harm to the cable

system, the cable operator may impose

additional technical specifications to

eliminate such harm. We believe that

subscriber access to home wiring is

necessary to enhance competition,

which will result in lower and more

reasonable rates for services such as the

installation of additional outlets.

Indeed, where competition is

introduced, consumers benefit from

lower prices, greater technological

innovation, and additional consumer

choice.

55. We do not believe that the rule we

are adopting will pose an undue risk of

signal leakage or harm to the cable

system. Many subscribers already own

and control their home wiring—e.g.,

where the cable operator charges for it

upon installation or where state law

deems home wiring to be a ‘‘fixture.’’

Indeed, as many cable interests have

pointed out in this proceeding, the

marketplace has established the F-type

connector as the de facto standard for

connecting coaxial cable to CPE. Such

connectors are readily available and, if

properly used, provide adequate signal

leakage protection. In addition, cable

operators can provide guidance to

subscribers who install their own

wiring. Also, as stated above, we will

permit cable operators to establish

reasonable technical specifications for

subscriber-installed home wiring

(including passive splitters, connectors

and other equipment used in the

installation of home wiring), not to

exceed the specifications of their own

wiring and equipment. Furthermore, we

will protect the cable system from

electronic and physical harm by

allowing the cable operator to impose

additional technical specifications

where such harm exists.

56. We will not modify our current

requirement that cable operators

monitor signal leakage and eliminate

harmful interference while they are

providing service, regardless of who

owns the home wiring. We also will

continue to require cable operators to

discontinue service to a subscriber

where signal leakage occurs, until the

problem is corrected. See 47 CFR

76.617. A cable operator will not be

held responsible for facilities over

which it no longer provides service. We

believe that the continuation of these

requirements will appropriately balance

the interests of subscribers with the

interests of those engaged in licensed

over-the-air communications and cable

operators in maintaining the security

and integrity of the cable systems.

57. Allowing subscribers to install

their own cable home wiring prior to

termination of service may raise

concerns regarding physical and

electronic harm to the cable system and

degradation of signal quality, including

interference with other customers’

service. To the extent a customer’s

installations or rearrangements of wiring

degrade the signal quality of or interfere

with other customers’ signals, or cause

electronic or physical harm to the cable

system, we will allow cable operators to

discontinue service to that subscriber, as

operators may do where a customer’s

wiring causes signal leakage, until the

degradation or interference is resolved.

We note, however, that cable operators

are not responsible for degradation of

signal quality to the subscriber where a

subscriber has added outlets or owns

and maintains his or her own wiring.

While we recognize that theft of cable

service is a legitimate concern, we do

not agree that our rules granting

customers pre-termination access to

cable home wiring will promote theft of

service. Some cable companies already

provide customer pre-termination

access to wiring, and there is no

evidence in the record that these

policies have resulted in increased theft

of service. In addition, cable operators

may take security measures, such as

scrambling of their signals, to deter theft

of service.

58. We will neither establish a

presumption of ownership of cable

home wiring nor deregulate home

wiring rates at this time. These issues

are beyond the scope of this proceeding.

We believe that our rules allowing

consumers to install, redirect and

reroute their cable home wiring

adequately promote the goals of

expanded competition and consumer

choice without the need to address

ownership issues. We also note our

obligation under section 623 to regulate

the rates of equipment used by

subscribers to receive the basic service

tier. See 47 U.S.C. § 543.

IX. Signal Leakage

59. The purpose of the Commission’s

signal leakage rules is to protect

licensed over-the-air communications,

including aeronautical, police, and fire

safety communications, from

interference caused by signal leakage.

Until now, the Commission rules

governing signal leakage have been

applied only to cable systems, which

often deliver signals over the same

frequency bands as many over-the-air

licensees. Specifically, § 76.605(a)(12)

establishes the maximum individual

signal leakage limits for all cable

operators using frequencies outside the

broadcast television bands, while

§§ 76.610–76.617 impose more stringent

operating and monitoring requirements

for cable systems operating in the bands

that are used by aircraft for

communications and navigation.

60. An increasing number of MVPDs

are competing with cable operators in

the provision of video programming and

other services. Because these MVPDs

often transmit signals over the same

public safety and navigation frequencies

as cable operators, they may be a source

of potentially harmful signal leakage.

The public safety concerns that underlie

application of our signal leakage

regulations to cable operators are

equally present with respect to other

MVPDs such as SMATV, MMDS and

open video system operators and others.

We will therefore modify our rules to

extend existing cable signal leakage

requirements to non-cable MVPDs. In

light of the potential harm to public

safety that may be caused by broadband

signal leakage interfering with

aeronautical, navigational and

communications radio systems, we will

not rely on labelling requirements,

installation instructions or cable

performance specifications.

61. Systems transmitting digitized

signals may operate in the restricted

aeronautical and public safety bands.

Our signal leakage rules provide that

systems operating in the restricted

bands are only subject to the testing and

monitoring requirements when they

operate above a threshold power level.
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61027

Systems using digital transmissions

normally operate below this power

threshold. Systems using digital

technology that operate below our

threshold power level therefore would

not generally be subject to the most

rigorous sections of our signal leakage

rules. For digital transmissions that may

operate above the power threshold, the

Commission shall continue to apply the

same requirements as those for analog

transmissions due to the potential harm

to public safety. MVPDs using digital

transmission will be subject to section

76.605(a)(12) which sets forth the

maximum signal leakage limits for

systems, regardless of the frequency

band or power level in use.

62. We will require that all MVPDs

comply with § 76.613 of our rules upon

the effective date of the Order. Section

76.613 protects licensed over-the-air

communications from harmful

interference and requires prompt action

to eliminate such interference. We

believe that immediate compliance with

§ 76.613 is necessary because, unlike

our other signal leakage rules that are

designed to minimize the risk of

interference by requiring that leakage be

detected and repaired, § 76.613 provides

that once harmful interference actually

occurs it must be promptly eliminated.

We recognize, however, that immediate

compliance with many of our other

signal leakage requirements may present

hardships to existing MVPDs not

previously subject to such rules. We

will allow for a five-year transition

period from the effective date of these

rules to afford non-cable MVPDs time to

comply with our signal leakage rules

other than § 76.613. The five-year

transition period will apply only to the

systems of those non-cable MVPDs that

have been substantially built as of

January 1, 1998. We will define

‘‘substantially built’’ as having 75% of

the distribution plant completed. The

signal leakage requirements under Part

15 of the Commission’s rules will

continue to apply during the transition

period.

63. Our rules require that each cable

system perform an independent signal

leakage test annually. 47 CFR 76.611.

Based on the current record, we will not

amend our rules to treat MDUs or

different geographic areas connected by

microwave link as separate systems for

testing purposes. We believe that for the

past six years our testing criteria have

provided effective standards for

monitoring and rectifying signal leakage

in 31,000 cable communities

nationwide. Cognizant of the changing

technologies that may be used by

MVPDs, we will continue to review

specific systems’ operations and designs

that may warrant adjustments to our

signal leakage testing criteria.

64. We will not establish any new

signal leakage testing procedures such

as tracking systems to identify the

source of signal leakage. We believe that

MVPDs are capable of devising and

selecting the most appropriate methods

for detecting signal leakage on their own

systems. We encourage MVPDs to work

together to develop methods that will

permit them to accurately identify the

source of any signal leakage.

65. While our signal leakage rules

generally require cable operators to

perform signal leakage monitoring and

testing, § 76.615 requires cable operators

to file specific information with the

Commission. In particular,

§ 76.615(b)(7) requires that cable

operators annually file with the

Commission the results of signal leakage

testing. The reporting requirements of

§ 76.615(b)(7) may impose undue

burdens on small MVPDs. In the Second

Further Notice of Proposed Rulemaking,

we seek comment on whether certain

MVPDs should be exempted from the

reporting requirements of § 76.615(b)(7).

Since § 76.615(b)(7) is one of the

provisions covered by the five-year

transition period, all non-cable MVPDs

will have five years to comply with the

filing requirements; the Second Further

Notice of Proposed Rulemaking seeks

comment on whether we should create

a permanent exemption for certain types

of MVPDs.

X. Signal Quality

66. By statute, the Commission is

charged with promulgating regulations

governing the quality of television

signals delivered to cable subscribers.

We believe that continued application

of the Commission’s signal quality

standards to cable operators is necessary

because, despite the recent entrance of

other service providers into the video

market, cable operators, in most areas of

the country, still exercise significant

market power. We do not believe at this

time that market forces alone will

ensure that cable subscribers receive the

quality picture they are entitled to

expect. With regard to non-cable

broadband service providers, we believe

that government regulation of signal

quality would be unnecessary and

unduly intrusive. These alternative

providers do not exercise market power

and virtually always compete with an

incumbent cable operator. Head-to-head

competition with a cable operator

should ensure that alternative MVPDs

deliver a good quality picture in order

to attract and retain customers. We

believe that, as cable operators become

subject to vigorous competition, market

forces will ensure that they, too, deliver

a good quality picture. As competition

develops and its effects become clearer,

we expect to leave the issue of signal

quality wholly to market forces.

XI. Means of Connection

67. Based on the record, we will not

adopt uniform technical standards for

jacks and connectors for broadband

service. The F-type connector has

emerged as the de facto broadband

connection standard within the cable

industry. We believe that, properly

used, the F-type connector is an

effective means of connecting coaxial

cable to customer premises equipment

while minimizing the potential for

signal leakage. Non-cable video service

providers also use the F-type connector

to connect their services via coaxial

cable to customer premises equipment.

Further government action in this area

is therefore unwarranted at this time. In

addition, in light of the fact that we are

extending our cable signal leakage rules

to all broadband service providers, we

believe that such providers will have

the incentive and obligation to ensure

that connections are properly made with

high quality materials, without the

Commission mandating a connection

standard.

XII. Dual Regulation

68. We do not believe that the record

before us provides sufficient

information to address the issue of

whether and how to harmonize the dual

systems of regulation governing cable

and telephone companies where

broadband or multiple services are

provided over a single wire or multiple

wires. Based on the current record, it

appears that service providers will

continue to use separate inside wiring to

provide cable and telephone service for

at least the near future. If and when

circumstances change, we will revisit

this issue with the goal of creating a

single set of inside wiring rules.

XIII. Regulation of Simple and Complex

and of Residential and Non-Residential

Wiring

69. We will not, at this time, establish

common definitions in the common

carrier and cable rules with regard to

simple versus complex wiring and

residential versus non-residential

wiring. See 47 CFR 68.213, 68.215. In

the telephone context, we believe that

our distinction between simple and

complex wiring has proven to be a

workable and effective way to promote

competition while ensuring network

protection. Similarly, in the cable

context, there may be substantial

differences between residential and
61028 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

commercial buildings which would

make it difficult to adopt uniform rules

for all kinds of property. We do not

believe that the current record provides

sufficient evidence to support the need

for a modification of our rules, nor does

it provide adequate guidance on the

direction any such modification should

take. We therefore will not modify our

rules at this time.

XIV. Customer Premises Equipment

70. The issue of whether we should

revise our rules regarding customer

premises equipment will be addressed

in a separate ongoing Commission

rulemaking proceeding arising under

new section 629 of the Communications

Act.

XV. Final Regulatory Flexibility Act

Analysis

71. As required by section 603 of the

Regulatory Flexibility Act, 5 U.S.C.

§ 603 (‘‘RFA’’), Initial Regulatory

Flexibility Analyses (‘‘IRFAs’’) were

incorporated in the Inside Wiring

Notice, the Cable Home Wiring Further

Notice, and the Inside Wiring Further

Notice. The Commission sought written

public comments on the proposals in

these notices, including comments on

the IRFAs. This Final Regulatory

Flexibility Analysis (‘‘FRFA’’) conforms

to the RFA, as amended by the Contract

with America Advancement Act of 1996

(‘‘CWAAA’’), Public Law 104–121, 110

Stat. 847 (1996). Title II of the CWAAA

is ‘‘The Small Business Regulatory

Enforcement Fairness Act of 1996’’

(SBREFA), codified at 5 U.S.C. § 601 et

seq.

Need for Action and Objectives of the

Rule

72.This Order adopts new procedural

mechanisms to provide order and

certainty regarding the disposition of

MDU home run wiring upon

termination of existing service. In

addition, this Order promotes

competition and consumer choice by

establishing rules for the disposition of

cable ‘‘loop through’’ wiring upon

termination of service. This Order also

permits consumers to provide or install

their own cable home wiring, or

redirect, reroute or connect additional

wiring to the cable operator’s home

wiring. These rules will promote

competition among MVPDs as well as

cable wiring services, which will result

in lower prices, greater technological

innovation, and additional consumer

choice. Finally, to protect public safety

and navigation frequencies, this Order

applies the cable signal leakage rules to

all broadband service providers that

pose a similar threat of interference with

licensed over-the-air communications.

Summary of Issues Raised by the Public

Comments in Response to the Initial

Regulatory Flexibility Analysis

73. In response to the IRFAs

contained in the Inside Wiring Notice

and the Cable Home Wiring Further

Notice, Building Owners, et al., filed

comments arguing that the proposed

rules would have a significant effect on

small residential and commercial

building operators and that the

Commission should exempt these

entities from any final rules. In response

to the IRFA contained in the Inside

Wiring Notice, CATA filed comments

and an ex parte submission requesting

that the Commission rescind the Inside

Wiring Notice and reissue it as a notice

of inquiry or reissue it with specific

proposed rules. CATA argues that the

Inside Wiring Notice failed to propose

specific rules, thereby preventing both

the Commission staff and small entities

from analyzing and commenting on the

effects of proposed rules on small

entities. RTE Group filed its comments

and reply comments as ‘‘a response by

a small business pursuant to section 603

of the Regulatory Flexibility Act.’’ The

issues raised by RTE Group are

addressed above. No comments were

filed in response to the IRFA contained

in the Inside Wiring Further Notice.

Description and Estimate of the Number

of Small Entities Impacted

74. 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

proposed rules. The RFA defines the

term ‘‘small entity’’ as having the same

meaning as the terms ‘‘small business,’’

‘‘small organization,’’ and ‘‘small

governmental jurisdiction,’’ and the

same meaning as the term ‘‘small

business concern’’ under section 3 of

the Small Business Act. Under the

Small Business Act, a ‘‘small business

concern’’ is one that: (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’’). The rules we

adopt in this Order will affect video

service providers and MDU owners.

75. Small MVPDs: SBA has developed

a definition of a small entity for cable

and other pay television services, which

includes all such companies generating

$11 million or less in annual receipts.

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 Bureau of the

Census, there were 1423 such cable and

other pay television services generating

less than $11 million in revenue that

were in operation for at least one year

at the end of 1992. 1992 Economic

Census Industry and Enterprise Receipts

Size Report, Table 2D, SIC 4841 (U.S.

Bureau of the Census data under

contract to the Office of Advocacy of the

U.S. Small Business Administration).

We will address each service

individually to provide a more succinct

estimate of small entities.

76. Cable Systems: The Commission

has developed its own definition of a

small cable company for the purposes of

rate regulation. Under the Commission’s

rules, a ‘‘small cable company,’’ is one

serving fewer than 400,000 subscribers

nationwide. 47 CFR 76.901(e). The

Commission developed this definition

based on its determinations that a small

cable system operator is one with

annual revenues of $100 million or less.

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. 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. Consequently, we estimate

that there are fewer than 1439 small

entity cable system operators that may

be affected by the decisions and rules

adopted in the Order.

77. The Communications Act also

contains a definition of a small cable

system operator, which is ‘‘a cable

operator that, directly or 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.’’ The Commission has

determined that there are 61,700,000

subscribers in the United States.

Therefore, we found that an 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. Based on available data,

we find that the number of cable

operators serving 617,000 subscribers or

less totals 1450. 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
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61029

would qualify as small cable operators

under the definition in the

Communications Act.

78. 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 annual revenues that are not more

than $40 million for the preceding three

calendar years. This definition of a

small entity in the context of the

Commission’s Report and Order

concerning MMDS auctions has been

approved by the SBA.

79. The Commission completed its

MMDS auction in March 1996 for

authorizations in 493 basic trading areas

(‘‘BTAs’’). Of 67 winning bidders, 61

qualified as small entities. Five bidders

indicated that they were minorityowned 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 believe that there

are approximately 1634 small MMDS

providers as defined by the SBA and the

Commission’s auction rules.

80. ITFS: There are presently 1,989

licensed educational ITFS stations and

97 licensed commercial ITFS stations.

Educational institutions are included in

the definition of a small business.

However, we do not collect annual

revenue data for ITFS licensees and are

unable to ascertain how many of the 97

commercial stations would be

categorized as small under the SBA

definition. Thus, we believe that at least

1,989 ITFS licensees are small

businesses.

81. DBS: There are presently nine

DBS licensees, some of which are not

currently in operation. The Commission

does not collect annual revenue data for

DBS and, therefore, is unable to

ascertain the number of small DBS

licensees that could be impacted by

these proposed rules. Although DBS

service requires a great investment of

capital for operation, we acknowledge

that there are several new entrants in

this field that may not yet have

generated $11 million in annual

receipts, and therefore may be

categorized as a small business, if

independently owned and operated.

82. HSD: The market for HSD service

is difficult to quantify. Indeed, the

service itself bears little resemblance to

other MVPDs. HSD owners have access

to more than 265 channels of

programming placed on C-band

satellites by programmers for receipt

and distribution by video service

providers, of which 115 channels are

scrambled and approximately 150 are

unscrambled. HSD owners can watch

unscrambled channels without paying a

subscription fee. To receive scrambled

channels, however, an HSD owner must

purchase an integrated receiver-decoder

from an equipment dealer and pay a

subscription fee to an HSD

programming packager. Thus, HSD

users include: (1) Viewers who

subscribe to a packaged programming

service, which affords them access to

most of the same programming provided

to subscribers of other video service

providers; (2) viewers who receive only

non-subscription programming; and (3)

viewers who receive satellite

programming services illegally without

subscribing. Because scrambled

packages of programming are most

specifically intended for retail

consumers, these are the services most

relevant to this discussion.

83. According to the most recently

available information, there are

approximately 30 program packagers

nationwide offering packages of

scrambled programming to retail

consumers. These program packagers

provide subscriptions to approximately

2,314,900 subscribers nationwide. This

is an average of about 77,163 subscribers

per program packager. This is

substantially smaller than the 400,000

subscribers used in the Commission’s

definition of a small MSO. Furthermore,

because this an average, it is likely that

some program packagers may be

substantially smaller.

84. OVS: The Commission has

certified nine OVS operators. Because

these services were introduced so

recently and only one operator is

currently offering programming to our

knowledge, little financial information

is available. Bell Atlantic (certified for

operation in Dover) and Metropolitan

Fiber Systems (‘‘MFS,’’ certified for

operation in Boston and New York)

have sufficient revenues to assure us

that they do not qualify as small

business entities. Two other operators,

Residential Communications Network

(‘‘RCN,’’ certified for operation in New

York) and RCN/BETG (certified for

operation in Boston), are MFS affiliates

and thus also fail to qualify as small

business concerns. However, Digital

Broadcasting Open Video Systems (a

general partnership certified for

operation in southern California), Urban

Communications Transport Corp. (a

corporation certified for operation in

New York and Westchester), and

Microwave Satellite Technologies, Inc.

(a corporation owned solely by Frank T.

Matarazzo and certified for operation in

New York) are either just beginning or

have not yet started operations.

Accordingly, we believe that three OVS

licensees may qualify as small business

concerns.

85. SMATVs: Industry sources

estimate that approximately 5200

SMATV operators were providing

service as of December 1995. Other

estimates indicate that SMATV

operators serve approximately 1.05

million residential subscribers as of

September 1996. The ten largest

SMATV operators together pass 815,740

units. If we assume that these SMATV

operators serve 50% of the units passed,

the ten largest SMATV operators serve

approximately 40% of the total number

of SMATV subscribers. Because these

operators are not rate regulated, they are

not required to file financial data with

the Commission. Furthermore, we are

not aware of any privately published

financial information regarding these

operators. Based on the estimated

number of operators and the estimated

number of units served by the largest

ten SMATVs, we believe that a

substantial number of SMATV operators

qualify as small entities.

86. LMDS: Unlike the above pay

television services, LMDS technology

and spectrum allocation will allow

licensees to provide wireless telephony,

data, and/or video services. An LMDS

provider is not limited in the number of

potential applications that will be

available for this service. Therefore, the

definition of a small LMDS entity may

be applicable to both cable and other

pay television (SIC 4841) and/or

radiotelephone communications

companies (SIC 4812). The SBA

definition for cable and other pay

services is defined above. A small

radiotelephone entity is one with 1500

employees or less. For the purposes of

this proceeding, we include only an

estimate of LMDS video service

providers. The vast majority of LMDS

entities providing video distribution

could be small businesses under the

SBA’s definition of cable and pay

television (SIC 4841). However, in the

LMDS Second Report and Order, we

defined a small LMDS provider as an

entity that, together with affiliates and

attributable investors, has average gross

revenues for the three preceding

calendar years of less than $40 million.

We have not yet received approval by

the SBA for this definition.

87. There is only one company,

CellularVision, that is currently

providing LMDS video services.

Although the Commission does not

collect data on annual receipts, we

assume that CellularVision is a small

business under both the SBA definition

and our proposed auction rules. We
61030 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

tentatively conclude that a majority of

the potential LMDS licensees will be

small entities, as that term is defined by

the SBA.

88. MDU Operators: The SBA has

developed definitions of small entities

for operators of nonresidential

buildings, apartment buildings and

dwellings other than apartment

buildings, which include all such

companies generating $5 million or less

in revenue annually. According to the

Census Bureau, there were 26,960

operators of nonresidential buildings

generating less than $5 million in

revenue that were in operation for at

least one year at the end of 1992. Also

according to the Census Bureau, there

were 39,903 operators of apartment

dwellings generating less than $5

million in revenue that were in

operation for at least one year at the end

of 1992. The Census Bureau provides no

separate data regarding operators of

dwellings other than apartment

buildings, and we are unable at this

time to estimate the number of such

operators that would qualify as small

entities.

Reporting, Recordkeeping, and Other

Compliance Requirements

89. Disposition of MDU Home Run

Wiring: The Order requires MVPDs to

comply with a set of procedural

timetables for the disposition of home

run wiring upon termination of service

when an MDU owner invokes the

Commission’s procedures. In addition,

it requires MVPDs to include in future

contracts with MDU owners a provision

addressing the disposition of home run

wiring upon the termination of the

contract. It also requires the parties to

cooperate to ensure as seamless a

transition as possible for subscribers.

90. Sharing of Molding: The Order

permits an MVPD to install home run

wiring in an existing molding if the

MDU owner determines that there is

sufficient space, if the incumbent

MVPD’s ability to provide service is not

impaired, and if the MDU owner gives

its affirmative consent. If the MDU

owner determines that there is not

sufficient space, and the MDU owner

will permit larger moldings, the MDU

owner may install larger moldings at the

alternative MVPD’s expense.

91. Disposition of Cable Home Wiring:

The Order requires MVPDs to

implement their election to remove or

abandon home wiring within seven days

of learning that the home wiring will

not be purchased.

92. Customer Access to Cable Home

Wiring before Termination of Service:

The Order requires cable operators to

permit subscribers to provide or install

their own cable home wiring, or

redirect, reroute or connect additional

wiring to the cable operator’s home

wiring, so long as no electronic or

physical harm is caused to the cable

system and the physical integrity of the

cable operator’s wiring remains intact.

The cable operator may choose to

impose requirements that any home

wiring meet reasonable technical

specifications, not to exceed the

technical specifications of such wiring

installed by the cable operator; however,

the cable operator may require

additional technical specifications to

eliminate electronic or physical harm.

93. Signal Leakage: The Order extends

the Commission’s cable signal leakage

rules to all broadband service providers

that pose a similar threat of interference

with frequencies used for over-the-air

communications. Section 76.615(b)(7) of

the cable signal leakage rules requires

cable operators to file annually with the

Commission the results of their signal

leakage tests conducted pursuant to

section 76.611.

Significant Alternatives and Steps

Taken To Minimize the Significant

Economic Impact on a Substantial

Number of Small Entities Consistent

With the Stated Objectives

This section analyzes the impact on

small entities of the regulations

adopted, amended, modified, or

clarified in this Order.

94. Disposition of MDU Home Run

Wiring: We considered several

alternatives for the disposition of MDU

home run wiring, including: (1) Creating

a single demarcation point for cable and

telephony providers; (2) moving the

cable demarcation point; and (3)

maintaining our current rules. The

record indicates that MDU owners often

object to the installation of multiple

home run wires for reasons including

aesthetics, space limitations, the

avoidance of disruption and

inconvenience, and the potential for

property damage. Small video service

providers often are new entrants that

will have to install new home run

wiring (if they cannot use the existing

wiring), while incumbent service

providers often are established entities

that may resist efforts by both new

entrants and MDU operators to arrange

for use of the existing wiring. By

bringing order and certainty to the

disposition of the home run wiring

upon termination of service, the rules

adopted herein advance the interests of

both small video service providers and

small MDU owners.

95. Transfer of Ownership of Home

Run Wiring in Future Installations: We

considered adopting a requirement that,

for future installations, MVPDs transfer

ownership of home run wiring to MDU

owners. We instead decided to require

MVPDs to include in future contracts

with MDU owners a provision

addressing the disposition of home run

wiring upon termination of the contract.

This requirement will provide all MDU

owners, including small MDU owners,

the flexibility to negotiate for ownership

of the home run wiring.

96. Sharing of Molding: We

considered not requiring the sharing of

molding even when empty space exists.

We concluded, however, that the ability

to share molding often may assist small

MVPDs, which frequently are new

entrants, to gain access to MDUs. We

considered Time Warner’s proposal to

allow affected MVPDs and the MDU

owner to determine whether the

molding contains adequate space. Our

rule, however, does not require the

concurrence of the affected MVPDs in

the determination of whether adequate

space exists.

97. Customer Access to Cable Home

Wiring before Termination of Service:

We believe that subscriber access to

home wiring will advance the interests

of small entities. As customers gain the

ability to select who will install and

maintain their home wiring, small

entities will be able to compete with the

incumbent cable operator to provide

such services.

98. Signal Leakage: This Order

extends the Commission’s cable signal

leakage rules to all broadband service

providers that pose a similar threat of

interference with frequencies used for

over-the-air communications. Although

this modification will impact small

broadband service providers, we are

exploring the possibility of exempting

certain categories of broadband service

providers from the reporting

requirements of the signal leakage rules.

Report to Congress

99. The Commission shall send a copy

of the Order, including this FRFA, in a

report to Congress pursuant to the Small

Business Regulatory Enforcement

Fairness Act of 1996, 5 U.S.C.

§ 801(a)(1)(A). A copy of the Order and

the FRFA will be sent to the Chief

Counsel for Advocacy of the Small

Business Administration.

XVI. Ordering Clauses

100. It is Ordered that, pursuant to

sections 1, 4(i), 201–205, 214–215, 220,

303, 623, 624 and 632 of the

Communications Act of 1934, as

amended, 47 U.S.C. §§ 151, 154(i), 201–

205, 214–215, 220, 303, 543, 544 and

552, the Commission’s rules are hereby

amended as set forth below.
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61031

101. It is further ordered that the

amendments in 47 CFR 76.613, 76.802

and 76.804 impose information

collection requirements, and will

therefore not become effective until

approved by the Office of Management

and Budget (‘‘OMB’’). The amendments

in 47 CFR 76.5, 76.620, 76.800, 76.805

and 76.806 will become effective 30

days following publication of this Order

in the Federal Register. However,

compliance with amendments in 47

CFR 76.5, 76.620, 76.800, 76.805 and

76.806 will not be required until OMB

approval of the information collection

requirements in 47 CFR 76.613, 76.802

and 76.804. The Commission will

publish a document at a later date

announcing the effective date of the

amendments in 47 CFR 76.613, 76.802

and 76.804, and the date of compliance

for the amendments in 47 CFR 76.5,

76.620, 76.800, 76.805 and 76.806.

102. It is further ordered that the

Commission shall send a copy of the

Order, including the Final Regulatory

Flexibility Analysis, to the Chief

Counsel for Advocacy of the Small

Business Administration.

List of Subjects in 47 CFR Part 76

Cable television.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

Part 76 of title 47 of the Code of

Federal Regulations is amended as

follows:

PART 76—CABLE TELEVISION

SERVICE

1. The authority citation for part 76

continues to read as follows:

Authority: 47 U.S.C. 151, 152, 153, 154,

301, 302, 303, 303a, 307, 308, 309, 312, 315,

317, 325, 503, 521, 522, 531, 532, 533, 534,

535, 536, 537, 543, 544, 544a, 545, 548, 552,

554, 556, 558, 560, 561, 571, 572, 573.

2. Section 76.5 is amended by revising

paragraph (mm)(2) and adding

paragraphs (mm)(3) and (mm)(4), to read

as follows:

§ 76.5 Definitions.

* * * * *

(mm) * * *

(2) For new and existing multiple

dwelling unit installations with nonloop-through wiring configurations, the

demarcation point shall be a point at (or

about) twelve inches outside of where

the cable wire enters the subscriber’s

dwelling unit, or, where the wire is

physically inaccessible at such point,

the closest practicable point thereto that

does not require access to the individual

subscriber’s dwelling unit.

(3) For new and existing multiple

dwelling unit installations with loopthrough wiring configurations, the

demarcation points shall be at (or about)

twelve inches outside of where the cable

wire enters or exits the first and last

individual dwelling units on the loop,

or, where the wire is physically

inaccessible at such point(s), the closest

practicable point thereto that does not

require access to an individual

subscriber’s dwelling unit.

(4) As used in this paragraph (mm)(3),

the term ‘‘physically inaccessible’’

describes a location that:

(i) Would require significant

modification of, or significant damage

to, preexisting structural elements, and

(ii) Would add significantly to the

physical difficulty and/or cost of

accessing the subscriber’s home wiring.

Note to paragraph (mm)(4): For example,

wiring embedded in brick, metal conduit or

cinder blocks with limited or without access

openings would likely be physically

inaccessible; wiring enclosed within hallway

molding would not.

* * * * *

3. Section 76.613 is amended by

revising the heading and by revising

paragraphs (b), (c), and (d) to read as

follows:

§ 76.613 Interference from a multichannel

video programming distributor (‘‘MVPD’’).

* * * * *

(b) An MVPD that causes harmful

interference shall promptly take

appropriate measures to eliminate the

harmful interference.

(c) If harmful interference to radio

communications involving the safety of

life and protection of property cannot be

promptly eliminated by the application

of suitable techniques, operation of the

offending MVPD or appropriate

elements thereof shall immediately be

suspended upon notification by the

District Director and/or Resident Agent

of the Commission’s local field office,

and shall not be resumed until the

interference has been eliminated to the

satisfaction of the District Director and/

or Resident Agent. When authorized by

the District Director and/or Resident

Agent, short test operations may be

made during the period of suspended

operation to check the efficacy of

remedial measures.

(d) The MVPD may be required by the

District Director and/or Resident Agent

to prepare and submit a report regarding

the cause(s) of the interference,

corrective measures planned or taken,

and the efficacy of the remedial

measures.

4. Section 76.620 is added to read as

follows:

§ 76.620 Non-cable multichannel video

programming distributors (‘‘MVPDs’’).

(a) Sections 76.605(a)(12), 76.610,

76.611, 76.612, 76.614, 76.615(b)(1–6),

76.616, and 76.617 shall apply to all

non-cable MVPDs. However, non-cable

MVPD systems that are substantially

built as of January 1, 1998 shall not be

subject to these sections until January 1,

2003. ‘‘Substantially built’’ shall be

defined as having 75 percent of the

distribution plant completed. As of

January 1, 2003, § 76.615(b)(7) shall

apply to all non-cable MVPDs.

(b) To comply with § 76.615(b)(2), a

non-cable MVPD shall submit its

Internal Revenue Service’s Employer

Identification (E.I.) number instead of an

FCC identifier.

5. Subpart M is amended by revising

the heading to read as follows:

Subpart M—Cable Inside Wiring

6. Section 76.800 is added to read as

follows:

§ 76.800 Definitions.

(a) MDU. A multiple dwelling unit

building (e.g., an apartment building,

condominium building or cooperative).

(b) MDU owner. The entity that owns

or controls the common areas of a

multiple dwelling unit building.

(c) MVPD. A multichannel video

programming distributor, as that term is

defined in Section 602(13) of the

Communications Act, 47 U.S.C. 522(13).

(d) Home run wiring. The wiring from

the demarcation point to the point at

which the MVPD’s wiring becomes

devoted to an individual subscriber or

individual loop.

7. Section 76.802 is amended by

revising paragraphs (a) and (g), and

adding paragraph (l) to read as follows:

§ 76.802 Disposition of cable home wiring.

(a)(1) Upon voluntary termination of

cable service by a subscriber in a single

unit installation, a cable operator shall

not remove the cable home wiring

unless it gives the subscriber the

opportunity to purchase the wiring at

the replacement cost, and the subscriber

declines. If the subscriber declines to

purchase the cable home wiring, the

cable system operator must then remove

the cable home wiring within seven

days of the subscriber’s decision, under

normal operating conditions, or make

no subsequent attempt to remove it or

to restrict its use.

(2) Upon voluntary termination of

cable service by an individual

subscriber in a multiple-unit

installation, a cable operator shall not be
61032 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

entitled to remove the cable home

wiring unless: it gives the subscriber the

opportunity to purchase the wiring at

the replacement cost; the subscriber

declines, and neither the MDU owner

nor an alternative MVPD, where

permitted by the MDU owner, has

provided reasonable advance notice to

the incumbent provider that it would

purchase the cable home wiring

pursuant to this section if and when a

subscriber declines. If the cable system

operator is entitled to remove the cable

home wiring, it must then remove the

wiring within seven days of the

subscriber’s decision, under normal

operating conditions, or make no

subsequent attempt to remove it or to

restrict its use.

(3) The cost of the cable home wiring

is to be based on the replacement cost

per foot of the wiring on the subscriber’s

side of the demarcation point multiplied

by the length in feet of such wiring, and

the replacement cost of any passive

splitters located on the subscriber’s side

of the demarcation point.

* * * * *

(g) If the cable operator adheres to the

procedures described in paragraph (b) of

this section, and the subscriber asks for

more time to make a decision regarding

whether to purchase the home wiring,

the seven (7) day period described in

paragraph (b) of this section will not

begin running until the subscriber

declines to purchase the wiring; in

addition, the subscriber may not use the

wiring to connect to an alternative

service provider until the subscriber

notifies the operator whether or not the

subscriber wishes to purchase the

wiring.

* * * * *

(l) The provisions of § 76.802, except

for § 76.802(a)(1), shall apply to all

MVPDs in the same manner that they

apply to cable operators.

8. Section 76.804 is added to read as

follows:

§ 76.804 Disposition of home run wiring.

(a) Building-by-building disposition of

home run wiring. (1) Where an MVPD

owns the home run wiring in an MDU

and does not (or will not at the

conclusion of the notice period) have a

legally enforceable right to remain on

the premises against the wishes of the

MDU owner, the MDU owner may give

the MVPD a minimum of 90 days’

written notice that its access to the

entire building will be terminated to

invoke the procedures in this section.

The MVPD will then have 30 days to

notify the MDU owner in writing of its

election for all the home run wiring

inside the MDU building: to remove the

wiring and restore the MDU building

consistent with state law within 30 days

of the end of the 90-day notice period

or within 30 days of actual service

termination, whichever occurs first; to

abandon and not disable the wiring at

the end of the 90-day notice period; or

to sell the wiring to the MDU building

owner. If the incumbent provider elects

to remove or abandon the wiring, and it

intends to terminate service before the

end of the 90-day notice period, the

incumbent provider shall notify the

MDU owner at the time of this election

of the date on which it intends to

terminate service. If the incumbent

provider elects to remove its wiring and

restore the building consistent with

state law, it must do so within 30 days

of the end of the 90-day notice period

or within 30 days of actual service

termination, which ever occurs first. For

purposes of abandonment, passive

devices, including splitters, shall be

considered part of the home run wiring.

The incumbent provider that has elected

to abandon its home run wiring may

remove its amplifiers or other active

devices used in the wiring if an

equivalent replacement can easily be

reattached. In addition, an incumbent

provider removing any active elements

shall comply with the notice

requirements and other rules regarding

the removal of home run wiring. If the

MDU owner declines to purchase the

home run wiring, the MDU owner may

permit an alternative provider that has

been authorized to provide service to

the MDU to negotiate to purchase the

wiring.

(2) If the incumbent provider elects to

sell the home run wiring under

paragraph (a)(1) of this section, the

incumbent and the MDU owner or

alternative provider shall have 30 days

from the date of election to negotiate a

price. If the parties are unable to agree

on a price within that 30-day time

period, the incumbent must elect: to

abandon without disabling the wiring;

to remove the wiring and restore the

MDU consistent with state law; or to

submit the price determination to

binding arbitration by an independent

expert. If the incumbent provider

chooses to abandon or remove its

wiring, it must notify the MDU owner

at the time of this election if and when

it intends to terminate service before the

end of the 90-day notice period. If the

incumbent service provider elects to

abandon its wiring at this point, the

abandonment shall become effective at

the end of the 90-day notice period or

upon service termination, whichever

occurs first. If the incumbent elects at

this point to remove its wiring and

restore the building consistent with

state law, it must do so within 30 days

of the end of the 90-day notice period

or within 30 days of actual service

termination, which ever occurs first.

(3) If the incumbent elects to submit

to binding arbitration, the parties shall

have seven days to agree on an

independent expert or to each designate

an expert who will pick a third expert

within an additional seven days. The

independent expert chosen will be

required to assess a reasonable price for

the home run wiring by the end of the

90-day notice period. If the incumbent

elects to submit the matter to binding

arbitration and the MDU owner (or the

alternative provider) refuses to

participate, the incumbent shall have no

further obligations under the

Commission’s home run wiring

disposition procedures. If the

incumbent fails to comply with any of

the deadlines established herein, it shall

be deemed to have elected to abandon

its home run wiring at the end of the 90-

day notice period.

(4) The MDU owner shall be

permitted to exercise the rights of

individual subscribers under this

subsection for purposes of the

disposition of the cable home wiring

under § 76.802. When an MDU owner

notifies an incumbent provider under

this section that the incumbent

provider’s access to the entire building

will be terminated and that the MDU

owner seeks to use the home run wiring

for another service, the incumbent

provider shall, in accordance with our

current home wiring rules: offer to sell

to the MDU owner any home wiring

within the individual dwelling units

that the incumbent provider owns and

intends to remove; and provide the

MDU owner with the total per-foot

replacement cost of such home wiring.

This information must be provided to

the MDU owner within 30 days of the

initial notice that the incumbent’s

access to the building will be

terminated. If the MDU owner declines

to purchase the cable home wiring, the

MDU owner may allow the alternative

provider to purchase the home wiring

upon service termination under the

terms and conditions of § 76.802. If the

MDU owner or the alternative provider

elects to purchase the home wiring

under these rules, it must so notify the

incumbent MVPD provider not later

than 30 days before the incumbent’s

termination of access to the building

will become effective. If the MDU owner

and the alternative provider fail to elect

to purchase the home wiring, the

incumbent provider must then remove

the cable home wiring, under normal

operating conditions, within 30 days of
Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations 61033

actual service termination, or make no

subsequent attempt to remove it or to

restrict its use.

(5) The parties shall cooperate to

avoid disruption in service to

subscribers to the extent possible.

(b) Unit-by-unit disposition of home

run wiring: (1) Where an MVPD owns

the home run wiring in an MDU and

does not (or will not at the conclusion

of the notice period) have a legally

enforceable right to maintain any

particular home run wire dedicated to a

particular unit on the premises against

the MDU owner’s wishes, the MDU

owner may permit multiple MVPDs to

compete for the right to use the

individual home run wires dedicated to

each unit in the MDU. The MDU owner

must provide at least 60 days’ written

notice to the incumbent MVPD of the

MDU owner’s intention to invoke this

procedure. The incumbent MVPD will

then have 30 days to provide a single

written election to the MDU owner as to

whether, for each and every one of its

home run wires dedicated to a

subscriber who chooses an alternative

provider’s service, the incumbent MVPD

will: remove the wiring and restore the

MDU building consistent with state law;

abandon the wiring without disabling it;

or sell the wiring to the MDU owner. If

the MDU owner refuses to purchase the

home run wiring, the MDU owner may

permit the alternative provider to

purchase it. If the alternative provider is

permitted to purchase the wiring, it will

be required to make a similar election

within this 30-day period for each home

run wire solely dedicated to a subscriber

who switches back from the alternative

provider to the incumbent MVPD.

(2) If the incumbent provider elects to

sell the home run wiring under

paragraph (b)(1), the incumbent and the

MDU owner or alternative provider

shall have 30 days from the date of

election to negotiate a price. During this

30-day negotiation period, the parties

may arrange for an up-front lump sum

payment in lieu of a unit-by-unit

payment. If the parties are unable to

agree on a price during this 30-day time

period, the incumbent must elect: to

abandon without disabling the wiring;

to remove the wiring and restore the

MDU consistent with state law; or to

submit the price determination to

binding arbitration by an independent

expert. If the incumbent elects to submit

to binding arbitration, the parties shall

have seven days to agree on an

independent expert or to each designate

an expert who will pick a third expert

within an additional seven days. The

independent expert chosen will be

required to assess a reasonable price for

the home run wiring within 14 days. If

subscribers wish to switch service

providers after the expiration of the 60-

day notice period but before the expert

issues its price determination, the

procedures set forth in paragraph (b)(3)

of this section shall be followed, subject

to the price established by the arbitrator.

If the incumbent elects to submit the

matter to binding arbitration and the

MDU owner (or the alternative provider)

refuses to participate, the incumbent

shall have no further obligations under

the Commission’s home run wiring

disposition procedures.

(3) When an MVPD that is currently

providing service to a subscriber is

notified either orally or in writing that

that subscriber wishes to terminate

service and that another service

provider intends to use the existing

home run wire to provide service to that

particular subscriber, a provider that has

elected to remove its home run wiring

pursuant to paragraph (b)(1) or (b)(2) of

this section will have seven days to

remove its home run wiring and restore

the building consistent with state law. If

the subscriber has requested service

termination more than seven days in the

future, the seven-day removal period

shall begin on the date of actual service

termination (and, in any event, shall

end no later than seven days after the

requested date of termination). If the

provider has elected to abandon or sell

the wiring pursuant to paragraph (b)(1)

or (b)(2) of this section, the

abandonment or sale will become

effective upon actual service

termination or upon the requested date

of termination, whichever occurs first.

For purposes of abandonment, passive

devices, including splitters, shall be

considered part of the home run wiring.

The incumbent provider may remove its

amplifiers or other active devices used

in the wiring if an equivalent

replacement can easily be reattached. In

addition, an incumbent provider

removing any active elements shall

comply with the notice requirements

and other rules regarding the removal of

home run wiring. If the incumbent

provider intends to terminate service

prior to the end of the seven-day period,

the incumbent shall inform the party

requesting service termination, at the

time of such request, of the date on

which service will be terminated. The

incumbent provider shall make the

home run wiring accessible to the

alternative provider within twenty-four

(24) hours of actual service termination.

(4) If the incumbent provider fails to

comply with any of the deadlines

established herein, the home run wiring

shall be considered abandoned, and the

incumbent may not prevent the

alternative provider from using the

home run wiring immediately to

provide service. The alternative

provider or the MDU owner may act as

the subscriber’s agent in providing

notice of a subscriber’s desire to change

services, consistent with state law. If a

subscriber’s service is terminated

without notification that another service

provider intends to use the existing

home run wiring to provide service to

that particular subscriber, the

incumbent provider will not be required

to carry out its election to sell, remove

or abandon the home run wiring; the

incumbent provider will be required to

carry out its election, however, if and

when it receives notice that a subscriber

wishes to use the home run wiring to

receive an alternative service. Section

76.802 of the Commission’s rules

regarding the disposition of cable home

wiring will apply where a subscriber’s

service is terminated without notifying

the incumbent provider that the

subscriber wishes to use the home run

wiring to receive an alternative service.

(5) The parties shall cooperate to

avoid disruption in service to

subscribers to the extent possible.

(6) Section 76.802 of the

Commission’s rules regarding the

disposition of cable home wiring will

continue to apply to the wiring on the

subscriber’s side of the cable

demarcation point.

(c) The procedures set forth in

paragraphs (a) and (b) of this section

shall apply unless and until the

incumbent provider obtains a court

ruling or an injunction within forty-five

(45) days following the initial notice

enjoining its displacement.

(d) After the effective date of this rule,

MVPDs shall include a provision in all

service contracts entered into with MDU

owners setting forth the disposition of

any home run wiring in the MDU upon

the termination of the contract.

(e) Incumbents are prohibited from

using any ownership interest they may

have in property located on or near the

home run wiring, such as molding or

conduit, to prevent, impede, or in any

way interfere with, the ability of an

alternative MVPD to use the home run

wiring pursuant to this section.

(f) Section 76.804 shall apply to all

MVPDs.

9. Section 76.805 is added to read as

follows:

§ 76.805 Access to molding.

(a) An MVPD shall be permitted to

install one or more home run wires

within the existing molding of an MDU

where the MDU owner finds that there

is sufficient space to permit the

installation of the additional wiring

without interfering with the ability of an
61034 Federal Register / Vol. 62, No. 220 / Friday, November 14, 1997 / Rules and Regulations

existing MVPD to provide service, and

gives its affirmative consent to such

installation. This paragraph shall not

apply where the incumbent provider

has an exclusive contractual right to

occupy the molding.

(b) If an MDU owner finds that there

is insufficient space in existing molding

to permit the installation of the new

wiring without interfering with the

ability of an existing MVPD to provide

service, but gives its affirmative consent

to the installation of larger molding and

additional wiring, the MDU owner (with

or without the assistance of the

incumbent and/or the alternative

provider) shall be permitted to remove

the existing molding, return such

molding to the incumbent, if

appropriate, and install additional

wiring and larger molding in order to

contain the additional wiring. This

paragraph shall not apply where the

incumbent provider possesses a

contractual right to maintain its molding

on the premises without alteration by

the MDU owner.

(c) The alternative provider shall be

required to pay any and all installation

costs associated with the

implementation of paragraphs (a) or (b)

of this section, including the costs of

restoring the MDU owner’s property to

its original condition, and the costs of

repairing any damage to the incumbent

provider’s wiring or other property.

10. Section 76.806 is added to read as

follows:

§ 76.806 Pre-termination access to cable

home wiring.

(a) Prior to termination of service, a

customer may: install or provide for the

installation of their own cable home

wiring; or connect additional home

wiring, splitters or other equipment

within their premises to the wiring

owned by the cable operator, so long as

no electronic or physical harm is caused

to the cable system and the physical

integrity of the cable operator’s wiring

remains intact.

(b) Cable operators may require that

home wiring (including passive

splitters, connectors and other

equipment used in the installation of

home wiring) meets reasonable

technical specifications, not to exceed

the technical specifications of such

equipment installed by the cable

operator; provided however, that if

electronic or physical harm is caused to

the cable system, the cable operator may

impose additional technical

specifications to eliminate such harm.

To the extent a customer’s installations

or rearrangements of wiring degrade the

signal quality of or interfere with other

customers’ signals, or cause electronic

or physical harm to the cable system,

the cable operator may discontinue

service to that subscriber until the

degradation or interference is resolved.

(c) Customers shall not physically cut,

substantially alter, improperly terminate

or otherwise destroy cable operatorowned home wiring.

[FR Doc. 97–29514 Filed 11–13–97; 8:45 am]

BILLING CODE 6712–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 76

[MM Docket No. 92–258; FCC 97–156]

Cable Television Consumer Protection

and Competition Act of 1992

AGENCY: Federal Communications

Commission.

ACTION: Final rule; announcement of

effective date.

SUMMARY: The Commission’s

amendments to 47 CFR Sections 76.701

and 76.702, which contained

information collection requirements,

became effective on October 29, 1997.

These amendments, which were

published in the Federal Register on

May 23, 1997, relate to implementation

of the cable television leased access and

public, educational, and governmental

access indecency provisions of the 1992

Cable Act.

EFFECTIVE DATE: The amendments to 47

CFR Sections 76.701 and 76.702,

published at 62 FR 28371, became

effective on October 29, 1997.

FOR FURTHER INFORMATION CONTACT:

Meryl S. Icove, Cable Services Bureau,

(202) 418–7200.

SUPPLEMENTARY INFORMATION:

1. On May 7, 1997, the Commission

released an order revising its indecency

rules for leased access and public,

educational and governmental access

channels, a summary of which was

published in the Federal Register. See

62 FR 28371, May 23, 1997. Because

they imposed new or modified

information collection requirements, 47

CFR Sections 76.701 and 76.702 could

not become effective until approved by

the Office of Management and Budget

(‘‘OMB’’). OMB approved these rule

changes on October 29, 1997.

2. The Federal Register summary

stated that the Commission would

publish a document confirming the

effective date and notifying parties that

these rules have become effective. The

amendments to 47 CFR Sections 76.701

and 76.702 became effective on October

29, 1997.

List of Subjects in 47 CFR Part 76

Administrative practice and

procedure, Cable television, Reporting

and recordkeeping requirements.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

[FR Doc. 97–29986 Filed 11–13–97; 8:45 am]

BILLING CODE 6712–01–P