61590 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

Dated: October 19, 2007. 

Russell L. Wright, Jr., 

Acting Regional Administrator, Region 4. 

[FR Doc. E7–21235 Filed 10–30–07; 8:45 am] 

BILLING CODE 6560–50–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 62 

[EPA–R09–OAR–2007–0916; FRL–8489–5] 

Approval and Promulgation of State 

Air Quality Plans for Designated 

Facilities and Pollutants; Control of 

Emissions From Existing Other Solid 

Waste Incinerator Units; Nevada 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: EPA is proposing to approve 

a negative declaration submitted by the 

Nevada Division of Environmental 

Protection. The negative declaration 

certifies that other solid waste 

incinerator units, which are subject to 

the requirements of sections 111(d) and 

129 of the Clean Air Act, do not exist 

within the agency’s air pollution control 

jurisdiction. 

DATES: Any comments on this proposal 

must arrive by November 30, 2007. 

ADDRESSES: Submit comments, 

identified by docket number EPA–R09–

OAR–2007–0916, by one of the 

following methods: 

1. Federal eRulemaking Portal: 

www.regulations.gov. Follow the on-line 

instructions. 

2. E-mail: steckel.andrew@epa.gov. 

3. Mail or deliver: Andrew Steckel 

(Air-4), U.S. Environmental Protection 

Agency Region IX, 75 Hawthorne Street, 

San Francisco, CA 94105–3901. 

Instructions: All comments will be 

included in the public docket without 

change and may be made available 

online at www.regulations.gov, 

including any personal information 

provided, unless the comment includes 

Confidential Business Information (CBI) 

or other information whose disclosure is 

restricted by statute. Information that 

you consider CBI or otherwise protected 

should be clearly identified as such and 

should not be submitted through 

www.regulations.gov or e-mail. 

www.regulations.gov is an ‘‘anonymous 

access’’ system, and EPA will not know 

your identity or contact information 

unless you provide it in the body of 

your comment. If you send e-mail 

directly to EPA, your e-mail address 

will be automatically captured and 

included as part of the public comment. 

If EPA cannot read your comment due 

to technical difficulties and cannot 

contact you for clarification, EPA may 

not be able to consider your comment. 

Docket: The index to the docket for 

this action is available electronically at 

www.regulations.gov and in hard copy 

at EPA Region IX, 75 Hawthorne Street, 

San Francisco, California. While all 

documents in the docket are listed in 

the index, some information may be 

publicly available only at the hard copy 

location (e.g., copyrighted material), and 

some may not be publicly available in 

either location (e.g., CBI). To inspect the 

hard copy materials, please schedule an 

appointment during normal business 

hours with the contact listed in the FOR

FURTHER INFORMATION CONTACT section. 

FOR FURTHER INFORMATION CONTACT: Mae 

Wang, EPA Region IX, (415) 947–4124, 

wang.mae@epa.gov. 

SUPPLEMENTARY INFORMATION: This 

proposal addresses a Clean Air Act 

section 111(d)/129 negative declaration 

submitted by the Nevada Division of 

Environmental Protection certifying that 

other solid waste incinerator units do 

not exist within its air pollution control 

jurisdiction. This negative declaration 

was submitted on December 19, 2006. 

For further information, please see the 

information provided in the direct final 

action, with the same title, that is 

located in the ‘‘Rules and Regulations’’

section of this Federal Register 

publication. If no adverse comments are 

received in response to this action, no 

further activity will be contemplated. If 

adverse comments are received, then 

EPA will publish a timely withdrawal of 

the direct final rule and address the 

comments in subsequent action based 

on this proposed rule. Please note that 

if we receive adverse comment on an 

amendment, paragraph, or section of 

this rule and if that provision may be 

severed from the remainder of the rule, 

we may adopt as final those provisions 

of the rule that are not the subject of an 

adverse comment. EPA will not institute 

a second comment period. Any parties 

interested in commenting on this action 

should do so at this time. 

Dated: September 17, 2007. 

Wayne Nastri, 

Regional Administrator, Region IX. 

[FR Doc. E7–21448 Filed 10–30–07; 8:45 am] 

BILLING CODE 6560–50–P 

FEDERAL COMMUNICATIONS 

COMMISSION 

47 CFR Part 76 

[MB Docket No. 07–198; FCC 07–169] 

Review of the Commission’s Program 

Access Rules and Examination of 

Programming Tying Arrangements 

AGENCY: Federal Communications 

Commission. 

ACTION: Proposed rule. 

SUMMARY: In this document, the 

Commission seeks comment on 

revisions to the Commission’s program 

access and retransmission consent rules 

and whether it may be appropriate to 

preclude the practice of programmers to 

tie desired programming with undesired 

programming. In the NPRM, the 

Commission also seeks comment on 

whether to revise its procedures for 

resolving program access complaints. 

DATES: Comments for this proceeding 

are due on or before November 30, 2007; 

reply comments are due on or before 

December 17, 2007. Written comments 

on the Paperwork Reduction Act 

proposed information collection 

requirements must be submitted by the 

public, Office of Management and 

Budget (OMB), and other interested 

parties on or before December 31, 2007. 

ADDRESSES: You may submit comments, 

identified by MB Docket No. 07–198, by 

any of the following methods: 

• Federal eRulemaking Portal: http:// 

www.regulations.gov. Follow the 

instructions for submitting comments. 

• Federal Communications 

Commission’s Web site: http:// 

www.fcc.gov/cgb/ecfs/. Follow the 

instructions for submitting comments. 

• People with Disabilities: Contact the 

FCC to request reasonable 

accommodations (accessible format 

documents, sign language interpreters, 

CART, etc.) by e-mail: FCC504@fcc.gov 

or phone: 202–418–0530 or TTY: 202–

418–0432. 

For detailed instructions for 

submitting comments and additional 

information on the rulemaking process, 

see the SUPPLEMENTARY INFORMATION

section of this document. 

FOR FURTHER INFORMATION CONTACT: For 

additional information on this 

proceeding, contact Steven Broeckaert, 

Steven.Broeckaert@fcc.gov; David 

Konczal, David.Konczal@fcc.gov; or 

Katie Costello, Katie.Costello@fcc.gov; of 

the Media Bureau, Policy Division, (202) 

418–2120. For additional information 

concerning the Paperwork Reduction 

Act information collection requirements 

contained in this document, contact 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61591 

Cathy Williams at 202–418–2918, or via 

the Internet at PRA@fcc.gov. 

SUPPLEMENTARY INFORMATION: This is a 

summary of the Commission’s Notice of 

Proposed Rulemaking (NPRM), MB 

Docket No. 07–198, FCC 07–169, 

adopted on September 11, 2007, and 

released on October 1, 2007. The full 

text of this document is available for 

public inspection and copying during 

regular business hours in the FCC 

Reference Center, Federal 

Communications Commission, 445 12th 

Street, SW., CY–A257, Washington, DC 

20554. This document will also be 

available via ECFS (http://www.fcc.gov/ 

cgb/ecfs/). (Documents will be available 

electronically in ASCII, Word 97, and/ 

or Adobe Acrobat.) The complete text 

may be purchased from the 

Commission’s copy contractor, 445 12th 

Street, SW., Room CY–B402, 

Washington, DC 20554. To request this 

document in accessible formats 

(computer diskettes, large print, audio 

recording, and Braille), send an e-mail 

to fcc504@fcc.gov or call the 

Commission’s Consumer and 

Governmental Affairs Bureau at (202) 

418–0530 (voice), (202) 418–0432 

(TTY). 

In addition to filing comments with 

the Office of the Secretary, a copy of any 

comments on the Paperwork Reduction 

Act proposed information collection 

requirements contained herein should 

be submitted to Cathy Williams, Federal 

Communications Commission, 445 12th 

St., SW., Room 1–C823, Washington, DC 

20554, or via the Internet at 

PRA@fcc.gov; and also to Nicholas A. 

Fraser of the Office of Management and 

Budget (OMB), via Internet at 

Nicholas_A._Fraser@omb.eop.gov or via 

fax at (202) 395–5167. 

Initial Paperwork Reduction Act of 

1995 Analysis 

This document contains proposed 

information collection requirements. 

The Commission, as part of its 

continuing effort to reduce paperwork 

burdens, invites the general public and 

the Office of Management and Budget 

(OMB) to comment on the information 

collection requirements contained in 

this document, as required by the 

Paperwork Reduction Act of 1995, 

Public Law 104–13. Public and agency 

comments are due December 31, 2007. 

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. 

In addition, pursuant to the Small 

Business Paperwork Relief Act of 2002, 

Public Law 107–198, see 44 U.S.C. 

3506(c)(4), we seek specific comment on 

how we might ‘‘further reduce the 

information collection burden for small 

business concerns with fewer than 25 

employees.’’

To view a copy of this information 

collection request (ICR) submitted to 

OMB: (1) Go to the Web page http:// 

www.reginfo.gov/public/do/PRAMain, 

(2) look for the section of the Web page 

called ‘‘Currently Under Review,’’ (3) 

click on the downward-pointing arrow 

in the ‘‘Select Agency’’ box below the 

‘‘Currently Under Review’’ heading, (4) 

select ‘‘Federal Communications 

Commission’’ from the list of agencies 

presented in the ‘‘Select Agency’’ box, 

(5) click the ‘‘Submit’’ button to the 

right of the ‘‘Select Agency’’ box, (6) 

when the list of FCC ICRs currently 

under review appears, look for the title 

of this ICR (or its OMB control number, 

if there is one) and then click on the ICR 

Reference Number to view detailed 

information about this ICR. 

OMB Number: 3060–0888. 

Title: Section 76.7, Petition 

Procedures; § 76.9, Confidentiality Of 

Proprietary Information; § 76.61, 

Dispute Concerning Carriage; § 76.914, 

Revocation Of Certification; § 76.1003, 

Program Access Proceedings; § 76.1302, 

Carriage Agreement Proceedings; 

§ 76.1513, Open Video Dispute 

Resolution. 

Form Number: N/A. 

Type of Review: Revision of a 

currently approved collection. 

Respondents: Businesses or other forprofit entities. 

Number of Respondents: 600. 

Estimated Time per Response: 4 to 60 

hours. 

Frequency of Response: On occasion 

reporting requirement; Third party 

disclosure requirement. 

Total Annual Burden: 19,200 hours. 

Total Annual Costs: $240,000. 

Nature of Response: Required to 

obtain or retain benefits. 

Nature and Extent of Confidentiality: 

A party that wishes to have 

confidentiality for proprietary 

information with respect to a 

submission it is making to the 

Commission must file a petition 

pursuant to the pleading requirements 

in § 76.7 and use the method described 

in §§ 0.459 and 76.9 to demonstrate that 

confidentiality is warranted. 

Privacy Act Impact Assessment: 

None. 

Needs and Uses: On September 11, 

2007, the Commission adopted a Report 

and Order and a Notice of Proposed 

Rulemaking In the Matter of 

Implementation of the Cable Television 

Consumer Protection and Competition 

Act of 1992—Development of 

Competition and Diversity in Video 

Programming Distribution: Section 

628(c)(5) of the Communications Act: 

Sunset of Exclusive Contract 

Prohibition; Review of the Commission’s 

Program Access Rules and Examination 

of Programming Tying Arrangements, 

MB Docket Nos. 07–29, 07–198, FCC 

07–169. Section 628 of the 

Communications Act proscribes a cable 

operator, a satellite cable programming 

vendor in which a cable operator has an 

attributable interest, or a satellite 

broadcast programming vendor from 

engaging in unfair methods of 

competition and deceptive practices and 

directs the Commission to, among other 

things, prescribe regulations to provide 

for an expedited Commission review of 

any complaints made under this section. 

Section 76.1003 contains the 

Commission’s procedural rules for 

resolving these program access 

complaints. The new proposed rules to 

this information collection are 47 CFR 

76.1003(e)(1) and 47 CFR 76.1003(j). 

Therefore, the rules for this information 

collection are as follows: 

47 CFR 76.1003(e)(1) requires a cable 

operator, satellite cable programming 

vendor, or satellite broadcast 

programming vendor that expressly 

references and relies upon a document 

in asserting a defense to a program 

access complaint filed pursuant to 

§ 76.1003 or in responding to a material 

allegation in a program access 

complaint filed pursuant to § 76.1003, to 

include such document or documents as 

part of the answer. 

47 CFR 76.1003(j) states in addition to 

the general pleading and discovery rules 

contained in § 76.7 of this part, parties 

to a program access complaint may 

serve requests for discovery directly on 

opposing parties, and file a copy of the 

request with the Commission. The 

respondent shall have the opportunity 

to object to any request for documents 

that are not in its control or relevant to 

the dispute. Such request shall be heard, 

and determination made, by the 

Commission. Until the objection is ruled 

upon, the obligation to produce the 

disputed material is suspended. Any 

party who fails to timely provide 

discovery requested by the opposing 

party to which it has not raised an 

objection as described above, or who 

fails to respond to a Commission order 


rwilkins on PROD1PC63 with PROPOSALS-1
61592 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

for discovery material, may be deemed 

in default and an order may be entered 

in accordance with the allegations 

contained in the complaint, or the 

complaint may be dismissed with 

prejudice. This proposed rule would 

add a new universe of filers to this 

information collection and OMB 

approval is needed. 

47 CFR Section 76.7. Pleadings 

seeking to initiate FCC action must 

adhere to the requirements of § 76.6 

(general pleading requirements) and 

§ 76.7 (initiating pleading 

requirements). Section 76.7 is used for 

numerous types of petitions and special 

relief petitions, including general 

petitions seeking special relief, waivers, 

enforcement, show cause, forfeiture and 

declaratory ruling procedures. 

47 CFR 76.9. A party that wishes to 

have confidentiality for proprietary 

information with respect to a 

submission it is making to the FCC must 

file a petition pursuant to the pleading 

requirements in § 76.7 and use the 

method described in §§ 0.459 and 76.9 

to demonstrate that confidentiality is 

warranted. The petitions filed pursuant 

to this provision are contained in the 

existing information collection 

requirement and are not changed by the 

proposed rule changes. 

47 CFR 76.61. Section 76.61(a) 

permits a local commercial television 

station or qualified low power television 

station that is denied carriage or 

channel positioning or repositioning in 

accordance with the must-carry rules by 

a cable operator to file a complaint with 

the FCC in accordance with the 

procedures set forth in § 76.7. Section 

76.61(b) permits a qualified local 

noncommercial educational television 

station that believes a cable operator has 

failed to comply with the FCC’s signal 

carriage or channel positioning 

requirements (§§ 76.56 through 76.57) to 

file a complaint with the FCC in 

accordance with the procedures set 

forth in § 76.7. 

47 CFR 76.914. Section 76.914(c) 

permits a cable operator seeking 

revocation of a franchising authority’s 

certification to file a petition with the 

FCC in accordance with the procedures 

set forth in § 76.7. 

47 CFR 76.1003. Section 76.1003(a) 

permits any multichannel video 

programming distributor aggrieved by 

conduct that it believes constitutes a 

violation of the FCC’s competitive 

access to cable programming rules to 

commence an adjudicatory proceeding 

at the FCC to obtain enforcement of the 

rules through the filing of a complaint, 

which must be filed and responded to 

in accordance with the procedures 

specified in § 76.7, except to the extent 

such procedures are modified by 

§ 76.1003. 

47 CFR 76.1302. Section 76.1302(a) 

permits any video programming vendor 

or multichannel video programming 

distributor aggrieved by conduct that it 

believes constitutes a violation of the 

FCC’s regulation of carriage agreements 

to commence an adjudicatory 

proceeding at the FCC to obtain 

enforcement of the rules through the 

filing of a complaint, which must be 

filed and responded to in accordance 

with the procedures specified in § 76.7, 

except to the extent such procedures are 

modified by § 76.1302. 

47 CFR 76.1513. Section 76.1513(a) 

permits any party aggrieved by conduct 

that it believes constitutes a violation of 

the FCC’s regulations or in section 653 

of the Communications Act (47 U.S.C. 

573) to commence an adjudicatory 

proceeding at the Commission to obtain 

enforcement of the rules through the 

filing of a complaint, which must be 

filed and responded to in accordance 

with the procedures specified in § 76.7, 

except to the extent such procedures are 

modified by § 76.1513. 

Summary of Notice of Proposed 

Rulemaking 

I. Procedure for Shortening Term of 

Extension of Exclusive Contract 

Prohibition 

1. In light of the five-year extension of 

the exclusivity ban in § 76.1002(c)(6) 

adopted in the Report and Order in MB 

Docket No. 07–29 on September 11, 

2007 (72 FR 56645, October 4, 2007), the 

Commission seeks comment on whether 

it can establish a procedure that would 

shorten the term of the extension if, 

after two years (i.e., October 5, 2009) a 

cable operator can show competition 

from new entrant MVPDs has reached a 

certain penetration level in the DMA. 

We seek comment on what this 

penetration level should be. And, we 

seek comment on whether two years or 

some other time frame is the appropriate 

period of time. Finally, we ask parties 

to comment on whether a market-bymarket analysis is appropriate as both a 

legal and policy matter. 

II. Extending Program Access Rules to 

Terrestrially Delivered Cable-Affiliated 

Programming 

2. In comments on the Notice of 

Proposed Rulemaking in MB Docket No. 

07–29 (72 FR 9289, March 1, 2007), 

competitive MVPDs provided various 

examples of withholding of terrestrially 

delivered cable-affiliated programming. 

Moreover, in the Report and Order, we 

note the Commission’s previous 

findings that in two instances—

Philadelphia and San Diego—

withholding of terrestrially delivered 

cable-affiliated programming has had a 

material adverse impact on competition 

in the video distribution market. As 

discussed in the Report and Order, 

however, the Commission has 

previously concluded that terrestrially 

delivered programming is ‘‘outside of 

the direct coverage’’ of the exclusive 

contract prohibition in section 

628(c)(2)(D). In the Report and Order, 

we state our continued view that the 

plain language of the definitions of 

‘‘satellite cable programming’’ and 

‘‘satellite broadcast programming’’ as 

well as the legislative history of the 

1992 Cable Act place terrestrially 

delivered programming beyond the 

scope of section 628(c)(2)(D). 

Commenters, however, cite various 

other provisions of the Communications 

Act as providing the Commission with 

statutory authority to extend the 

program access rules, including an 

exclusive contract prohibition, to 

terrestrially delivered cable-affiliated 

programming, such as sections 4(i), 

201(b), 303(r), 601(6), 612(g), 616(a), 

628(b), and 706. 

3. As demonstrated by the examples 

of withholding of regional sports 

networks (RSNs) in San Diego and 

Philadelphia, we believe that 

withholding of terrestrially delivered 

cable-affiliated programming is a 

significant concern that can adversely 

impact competition in the video 

distribution market. To address this 

concern, we seek comment on whether 

it would be appropriate to extend our 

program access rules to all terrestrially 

delivered cable-affiliated programming 

pursuant to sections 4(i), 201(b), 303(r), 

601(6), 612(g), 616(a), 628(b), or 706, or 

any other provision under the 

Communications Act. See 47 U.S.C. 

154(i); 47 U.S.C. 201(b); 47 U.S.C. 

303(r); 47 U.S.C. 521(6); 47 U.S.C. 

532(g); 47 U.S.C. 536(a); 47 U.S.C. 

548(b); 47 U.S.C. 157 nt. In particular, 

we note our previous conclusion that 

the ability to offer a viable video service 

is ‘‘linked intrinsically’’ to broadband 

deployment. See Local Franchising 

Report and Order, 72 FR 13189, March 

21, 2007. We seek comment on whether 

the ability to offer terrestrially delivered 

cable-affiliated programming is needed 

to offer a viable video service and, 

accordingly, whether extending the 

program access rules, including the 

prohibition on exclusive contracts, to 

terrestrially delivered cable-affiliated 

programming would promote the goal of 

section 706 to facilitate broadband 

deployment. In addition, we note that 

the plain language of section 628(b), like 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61593 

section 628(c)(2)(D), specifies ‘‘satellite 

cable programming’’ and ‘‘satellite 

broadcast programming.’’ See 47 U.S.C. 

548(b); 548(c)(2)(D). We seek comment 

regarding whether we have the authority 

to extend our program access rules to all 

terrestrially delivered cable-affiliated 

programming by way of statutory 

provisions granting general authority to 

the Commission, in light of the specific 

authority in section 628 that limits their 

scope to satellite programming. 

4. We also seek comment on the 

extent to which cable operators are 

shifting delivery of affiliated 

programming from satellite delivery to 

terrestrial delivery and whether such 

action is intended to evade the program 

access rules. We note Verizon’s claim 

that Cablevision’s programming 

subsidiary, Rainbow, has made standard 

definition feeds of its RSNs available by 

satellite, but High Definition (HD) feeds 

available terrestrially, thereby avoiding 

the program access rules, including the 

exclusive contract prohibition, for HD 

feeds. We seek comment on whether the 

program access rules should apply to all 

feeds of the same programming, 

including both standard and HD feeds, 

regardless of whether one feed is 

delivered terrestrially. We also seek 

comment on whether shifting the HD 

feed of vertically integrated cable 

programming to terrestrial delivery is an 

unfair method of competition or an 

unfair or deceptive act in violation of 

section 628(b) of the Communications 

Act. 47 U.S.C. 548(b). The Commission 

has stated ‘‘there may be circumstances 

where moving programming from 

satellite to terrestrial delivery could be 

cognizable under section 628(b) as an 

unfair method of competition or 

deceptive practice if it precluded 

competitive MVPDs from providing 

satellite cable programming.’’

III. Expanding the Exclusive Contract 

Prohibition to Non-Cable-Affiliated 

Programming 

5. We also seek comment on whether 

to expand the exclusive contract 

prohibition to apply to non-cableaffiliated programming that is affiliated 

with a different MVPD, principally a 

DBS provider. As discussed above, to 

the extent that an MVPD meets the 

definition of a ‘‘cable operator’’ under 

the Communications Act, the exclusive 

contract prohibition in section 

628(c)(2)(D) already applies to its 

affiliated programming. Moreover, as 

noted above, section 628(j) of the 

Communications Act provides that any 

provision of section 628, including the 

exclusive contract prohibition in section 

628(c)(2)(D), that applies to a cable 

operator also applies to any common 

carrier or its affiliate that provides video 

programming. 47 U.S.C. 548(j). 

Programming affiliated with other 

MVPDs, such as DBS providers, is 

beyond the scope of the exclusive 

contract prohibition in section 

628(c)(2)(D). We seek comment on 

whether to extend the exclusive contract 

prohibition to non-cable-affiliated 

programming that is affiliated with a 

different MVPD, principally a DBS 

provider, pursuant to sections 4(i), 

201(b), 303(r), 601(6), 612(g), 616(a), 

628(b), or 706, or any other provision 

under the Communications Act. 

IV. Tying of Desired Programming With 

Undesired Programming 

6. Small and rural cable operators and 

other MVPDs have raised concerns 

regarding tying of MVPDs’ rights to 

carry broadcast stations with carriage of 

other owned or affiliated broadcast 

stations in the same or a distant market 

or one or more affiliated non-broadcast 

network. For example, in 2002, the 

American Cable Association (ACA), 

representing small cable operators, filed 

a Petition for Inquiry stating that 

broadcast networks and station groups 

engage in unfair retransmission tying 

arrangements. See American Cable 

Association’s Petition for Inquiry into 

Retransmission Consent Practices (filed 

October 1, 2002) (ACA 2002 Petition). 

ACA explains that tying harms small 

cable operators and their consumers by 

increasing the costs of basic cable and 

reducing program choices. Small and 

rural cable operators and other MVPDs, 

in addition to recent program access 

complainants, have also raised concerns 

regarding the practice of programmers to 

tie marquee programming, such as 

premium channels or regional sports 

programming, with unwanted, or less 

desirable, programming. For example, in 

their comments on the Notice of 

Proposed Rulemaking in MB Docket No. 

07–29, OPASTCO/ITAA, representing 

small and rural MVPDs, cites the 

practice of programmers to require 

carriage of less popular programming in 

specified (usually basic) tiers in return 

for the right to carry popular 

programming as an onerous and 

unreasonable condition that denies 

consumers choice and impedes entry 

into the MVPD market. 

7. When programming is available for 

purchase only through programmercontrolled packages that include both 

desired and undesired programming, 

MVPDs face two choices. First, the 

MVPD can refuse the tying arrangement, 

thereby potentially depriving itself of 

desired, and often economically vital, 

programming that subscribers demand 

and which may be essential to attracting 

and retaining subscribers. Second, the 

MVPD can agree to the tying 

arrangement, thereby incurring costs for 

programming that its subscribers do not 

demand and may not want, with such 

costs being passed on to subscribers in 

the form of higher rates, and also forcing 

the MVPD to allocate channel capacity 

for the unwanted programming in place 

of programming that its subscribers 

prefer. In either case, the MVPD and its 

subscribers are harmed by the refusal of 

the programmer to offer each of its 

programming services on a stand-alone 

basis. We note that the competitive 

harm and adverse impact on consumers 

would be the same regardless of 

whether the programmer is affiliated 

with a cable operator or a broadcaster or 

is affiliated with neither a cable operator 

nor a broadcaster, such as networks 

affiliated with a non-cable MVPD or a 

non-affiliated independent network. 

Moreover, we note that small cable 

operators and MVPDs are particularly 

vulnerable to such tying arrangements 

because they do not have leverage in 

negotiations for programming due to 

their smaller subscriber bases. As 

discussed in more detail below, we seek 

comment on these various types of tying 

arrangements. Given the problems 

associated with such tying 

arrangements, we seek comment on 

whether it may be appropriate for the 

Commission to preclude them. We also 

seek comment on the extent to which 

these disparities in bargaining power are 

the result of media consolidation, and, 

if so, what steps the Commission can 

and should take to redress the 

imbalance. 

8. Tying of Broadcast Programming. 

We seek comment on the tying of 

MVPDs’ rights to carry broadcast 

stations with carriage of other owned or 

affiliated broadcast stations in the same 

or a distant market or one or more 

affiliated non-broadcast networks. 

Section 325(b)(3)(C) of the 

Communications Act obligates 

broadcasters and multichannel video 

programming distributors to negotiate 

retransmission consent agreements in 

good faith. 47 U.S.C. 325(b)(3)(C). 

Specifically, the Commission must 

establish regulations that: 

Until January 1, 2010, prohibit a television 

broadcast station that provides 

retransmission consent from engaging in 

exclusive contracts for carriage or failing to 

negotiate in good faith, and it shall not be a 

failure to negotiate in good faith if the 

television broadcast station enters into 

retransmission consent agreements 

containing different terms and conditions, 

including price terms, with different 

multichannel video programming 

distributors if such different terms and 


rwilkins on PROD1PC63 with PROPOSALS-1
61594 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

conditions are based on competitive 

marketplace considerations. 47 U.S.C. 

325(b)(3)(C)(ii). 

Pursuant to the Satellite Home Viewer 

Extension and Reauthorization Act of 

2004 (SHVERA), Congress extended 47 

U.S.C. 325(b)(3)(C) until 2010 and 

amended that section to impose a 

reciprocal good faith retransmission 

consent bargaining obligation on 

MVPDs. The Commission adopted rules 

implementing section 207 of SHVERA. 

See Reciprocal Bargaining Order, 70 FR 

40216, July 13, 2005. 

9. In its Good Faith Order, the 

Commission adopted rules 

implementing the good faith negotiation 

provisions and the complaint 

procedures for alleged rule violations. 

See Good Faith Order, 68 FR 52127, 

September 2, 2003. The Good Faith 

Order adopted a two-part test for good 

faith. The first part of the test consists 

of a brief, objective list of negotiations 

standards. First, a broadcaster may not 

refuse to negotiate with an MVPD 

regarding retransmission consent. 

Second, a broadcaster must appoint a 

negotiating representative with 

authority to bargain on retransmission 

consent issues. Third, a broadcaster 

must agree to meet at reasonable times 

and locations and cannot act in a 

manner that would unduly delay the 

course of negotiations. Fourth, a 

broadcaster may not put forth a single, 

unilateral proposal. Fifth, a broadcaster, 

in responding to an offer proposed by an 

MVPD, must provide considered 

reasons for rejecting any aspects of the 

MVPD’s offer. Sixth, a broadcaster is 

prohibited from entering into an 

agreement with any party conditioned 

upon denying retransmission consent to 

any MVPD. Finally, a broadcaster must 

agree to execute a written 

retransmission consent agreement that 

sets forth the full agreement between the 

broadcaster and the MVPD. The second 

part of the good faith test is based on a 

totality of the circumstances standard. 

10. The Commission has held that 

‘‘[r]efusal by a Negotiating Entity to put 

forth more than a single, unilateral 

proposal’’ is a per se violation of a 

broadcast licensee’s good faith 

obligation. See 47 CFR 76.65(b)(1)(iv). 

The Commission has also indicated that 

such requirement is not limited to 

monetary considerations, but also 

applies to situations where a 

broadcaster is unyielding in its 

insistence upon carriage of a secondary 

programming service undesired by the 

cable operator as a condition of granting 

its retransmission consent: 

‘‘Take it or leave it’’ bargaining is not 

consistent with an affirmative obligation to 

negotiate in good faith. For example, a 

broadcaster might initially propose that, in 

exchange for carriage of its signal, an MVPD 

carry a cable channel owned by, or affiliated 

with, the broadcaster. The MVPD might reject 

such offer on the reasonable grounds that it 

has no vacant channel capacity and request 

to compensate the broadcaster in some other 

way. Good faith negotiation requires that the 

broadcaster at least consider some form of 

consideration other than carriage of affiliated 

programming. This standard does not, in any 

way, require a broadcaster to reduce the 

amount of consideration it desires for 

carriage of its signal. This standard only 

requires that the broadcaster be open to 

discussing more than one form of 

consideration in seeking compensation for 

retransmission of its signal by MVPDs. 

11. As discussed above, ACA in 2002 

filed a Petition for Inquiry regarding the 

Commission’s retransmission consent 

rules. See ACA 2002 Petition. This 

petition will be placed in the record of 

this proceeding. ACA’s Petition raises 

concerns about broadcasters’ alleged 

abuse of the retransmission consent 

process. ACA asserts that broadcast 

networks and station groups engage in 

unfair retransmission tying 

arrangements. ACA asserts that small 

cable operators have minimal bargaining 

power during negotiations and are 

targets for abuse because of their lack of 

resources to file complaints and engage 

in disputes. We note that its 

Retransmission Consent and Exclusivity 

Rules: Report to Congress Pursuant to 

Section 208 of the Satellite Home 

Viewer Extension and Reauthorization 

Act of 2004 (September 8, 2005) 

(available at http://www.fcc.gov/mb/ 

policy/shvera.html), the Commission 

addressed the tying issue. The 

Commission noted ‘‘cable operators’

widespread concern that retransmission 

consent negotiations frequently involve 

broadcasters tying carriage of their 

signals to numerous affiliated nonbroadcast programming networks.’’ The 

Report noted that ‘‘since the 

Commission’s decision to deny 

broadcasters the ability to assert dual 

and multicast must carry, broadcasters 

have begun using their retransmission 

consent negotiations to negotiate 

carriage of their digital signals, thus 

furthering the digital transition by 

increasing the number of households 

with access to digital signals. If 

broadcasters are limited in their ability 

to accept in-kind compensation, they 

should be granted full carriage rights for 

digital signals, including all free overthe-air digital multicast streams. Should 

Congress consider proposals 

circumscribing retransmission consent 

compensation, we encouraged review of 

related rules and policies to maintain 

proper balance.’’

12. We seek comment on the current 

status of carriage negotiations in today’s 

marketplace. We seek comment on 

whether broadcasters are tying carriage 

of their broadcast signals to carriage of 

other owned or affiliated broadcast 

stations in the same or a distant market 

or one or more affiliated non-broadcast 

networks and, if so, how retransmission 

consent negotiations are impacted. We 

ask if broadcast networks and station 

groups engage in retransmission consent 

tying arrangements that result in harm 

to small cable operators and their 

customers. We ask if the Commission’s 

good faith negotiation regulations 

provide enough protection for small 

cable operators and small broadcasters 

in the negotiation process, taking into 

account the administrative burdens and 

costs of engaging in a contested case 

before the Commission. We seek 

comment on whether and how the 

Commission’s good faith negotiation 

regulations should be modified to 

address these concerns. Also, we ask 

what the effect of any modifications 

would be on the economic 

underpinnings of broadcast-affiliated 

programmers. 

13. We also seek comment on whether 

the Commission has the jurisdiction to 

preclude tying arrangements by 

broadcasters, without modification of 

the retransmission consent regime by 

Congress. The legislative history of 

section 325 addresses the right of 

broadcasters to seek carriage of 

additional channels as part of 

retransmission consent transactions: 

‘‘Other broadcasters may not seek 

monetary compensation, but instead 

negotiate other issues with cable 

systems, such as joint marketing efforts, 

the opportunity to provide news inserts 

on cable channels, or the right to 

program an additional channel on a 

cable system. It is the Committee’s 

intention to establish a marketplace for 

the disposition of the rights to 

retransmit broadcast signals; it is not the 

Committee’s intention in this bill to 

dictate the outcome of the ensuing 

marketplace negotiations.’’ Congress 

appeared to contemplate carriage of 

broadcast-affiliated cable channels as 

part of legitimate retransmission 

consent negotiations. 

14. In addition, we seek comment 

regarding whether there are grounds for 

the Commission to depart from prior 

holdings that permitted broadcasters to 

negotiate the carriage of affiliated 

channels as part of retransmission 

consent negotiations. The Commission 

has stated that examples of bargaining 

proposals ‘‘presumptively * * * 

consistent with competitive marketplace 

considerations and the good faith 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61595 

negotiation requirement’’ include 

‘‘proposals for carriage conditioned on 

carriage of any other programming, such 

as a broadcaster’s digital signals, an 

affiliated cable programming service, or 

another broadcast station either in the 

same or a different market.’’ See 

Implementation of the Satellite Home 

Viewer Improvement Act of 1999, 65 FR 

15559, March 23, 2000. We held that 

such a proposal contains 

‘‘presumptively legitimate terms and 

conditions or forms of consideration’’

and found nothing to suggest that such 

a request is ‘‘impermissible’’ or anything 

‘‘other than a competitive marketplace 

consideration.’’ In 2001, the 

Commission considered but refused to 

adopt rules specifically prohibiting 

tying arrangements. See Carriage of 

Digital Television Broadcast Signals, 66 

FR 16533, March 26, 2001. The 

Commission concluded that such 

arrangements are permitted, but stated it 

would continue to monitor the situation 

with respect to potential 

anticompetitive conduct by 

broadcasters. We seek comment on 

whether market circumstances and 

industry practices have changed to 

warrant a different conclusion. 

15. Lastly, we ask whether 

Commission action to preclude tying 

arrangements is consistent with the First 

Amendment. On the one hand, it could 

be argued that restricting such 

arrangements infringes the right of 

broadcasters to express a message by 

packaging together certain content. On 

the other hand, we note that the 

Supreme Court has observed that ‘‘the 

programming offered on various 

channels’’ by video distributors consists 

of ‘‘individual, unrelated segments that 

happen to be transmitted together for 

individual selection by members of the 

audience.’’ Unlike newspapers and 

magazines, the Court suggested that 

these segments do not ‘‘contribute 

something to a common theme’’

expressed by the distributor to its 

subscribers. 

16. Tying of Satellite Cable 

Programming. Small and rural MVPDs 

as well as program access complainants 

have asserted that tying practices by 

satellite cable programmers constitute 

‘‘unfair methods of competition or 

unfair or deceptive acts or practices, the 

purpose or effect of which is to hinder 

significantly or to prevent any [MVPD] 

from providing satellite cable 

programming * * * to subscribers or 

consumers’’ in violation of section 

628(b) of the Communications Act. 47 

U.S.C. 548(b). At the time of the First 

Report and Order, 58 FR 27658, May 11, 

1993, the Commission declined to adopt 

specific rules under section 628(b) to 

address tying, while clearly reserving 

the right to do so if necessary: 

Neither the record of this proceeding nor 

the legislative history offer much insight into 

the types of practices that might constitute a 

violation of the statute with respect to the 

unspecified ‘‘unfair practices’’ prohibited by 

section 628(b) * * * The objectives of the 

provision, however, are clearly to provide a 

mechanism for addressing those types of 

conduct, primarily associated with horizontal 

and vertical concentration within the cable 

and satellite cable programming field, that 

inhibit the development of multichannel 

video distribution competition. 

* * * * * 

Thus, although the types of conduct more 

specifically referenced in the statute, i.e., 

exclusive contracting, undue influence 

among affiliates, and discriminatory sales 

practices, appear to be the primary areas of 

congressional concern, section 628(b) is a 

clear repository of Commission jurisdiction 

to adopt additional rules or to take additional 

actions to accomplish the statutory objectives 

should additional types of conduct emerge as 

barriers to competition and obstacles to 

broader distribution of satellite cable * * * 

programming. 

17. We seek comment on the current 

status of carriage negotiations in today’s 

marketplace. We seek comment on 

whether satellite cable programmers are 

tying carriage of their desirable channels 

to carriage of other less desirable owned 

or affiliated channels. We ask whether 

and how such tying arrangements affect 

small cable operators and their 

customers. We seek comment on 

whether ‘‘take-it-or-leave-it’’ tying 

arrangements (i.e., where the purchase 

of desired programming is conditioned 

on the purchase of undesired 

programming) without any alternative 

offer to provide the programming on a 

stand-alone basis are prevalent in the 

industry; and if so, whether such an 

arrangement is a violation of section 

628(b). As discussed above, in such 

situations, MVPDs are victims of an 

unfair method of competition that 

hinders significantly or prevents MVPDs 

from providing satellite cable 

programming to subscribers. 

18. We also seek comment on whether 

the Commission has the jurisdiction to 

preclude tying arrangements by satellite 

cable programmers under section 628(b) 

or any other statutory authority. We 

seek comment on whether section 

628(b) requires satellite cable 

programmers to offer each of their 

programming services on a stand-alone 

basis to all MVPDs at reasonable rates, 

terms, and conditions. Moreover, to the 

extent that we decide in this proceeding 

to extend the Commission’s program 

access rules to terrestrially delivered 

cable-affiliated programming networks, 

we seek comment on whether we 

should also require terrestrially 

delivered cable-affiliated programming 

networks to be offered on a stand-alone 

basis to all MVPDs at reasonable rates, 

terms, and conditions. Lastly, we ask 

whether Commission action to preclude 

tying arrangements by satellite cable 

programmers is consistent with the First 

Amendment. 

19. Tying of Other Programming. We 

also seek comment on whether we have 

the jurisdiction or authority to require 

networks that are affiliated with neither 

a cable operator nor a broadcaster, such 

as networks affiliated with a non-cable 

MVPD or a non-affiliated independent 

network, to be offered on a stand-alone 

basis to all MVPDs at reasonable rates, 

terms, and conditions. We seek 

comment on the extent to which such 

programming networks have engaged in 

unfair tying practices or other abusive 

practices that would require regulatory 

intervention. We seek comment on 

whether it would be appropriate to 

regulate these programming networks in 

such a manner pursuant to sections 4(i), 

201(b), 303(r), 601(6), 612(g), 616(a), and 

706, or any other provision under the 

Communications Act. 

V. Program Access Concerns Raised by 

Small and Rural MVPDs 

20. As discussed above, small and 

rural MVPDs raise additional issues in 

their comments regarding obstacles they 

face in trying to obtain access to 

programming. They ask the Commission 

to examine various conditions they 

describe as onerous and unreasonable, 

which they allege are imposed by 

programmers on small and rural MVPDs 

for access to content, including 

restrictions on the use of shared 

headends for receiving content. NTCA 

and OPASTCO/ITTA claim that use of 

a shared headend is an economical 

means for multiple rural MVPDs to 

provide video service in a high-cost 

area, but that programmers have 

expressed concern with the potential for 

the use of shared headends to result in 

unauthorized reception of programming. 

NTCA states that while shared headend 

providers are currently negotiating with 

content providers to resolve these 

issues, it is concerned that rural 

consumers served by shared headends 

may lose access to programming if these 

negotiations fail. In addition to the issue 

of shared headends, small and rural 

MVPDs ask the Commission to examine 

other conditions imposed by 

programmers, including (i) requiring 

MVPDs to enter into mandatory nondisclosure agreements with 

programmers, which prevents small and 

rural MVPDs from obtaining 

information about the market value of 


rwilkins on PROD1PC63 with PROPOSALS-1
61596 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

programming; (ii) requiring small and 

rural MVPDs to provide programmers 

with ‘‘hundreds of advertising slots’’; 

and (iii) mandating unwarranted 

security requirements that extend 

beyond the legitimate need to protect 

programming. OPASTCO/ITTA claim 

that all of these conditions impede the 

entry of small and rural telephone 

companies into the video distribution 

marketplace. We seek comment on the 

extent to which such practices are 

occurring in the marketplace and, if so, 

whether we should, and whether we 

have the authority to, take action to 

address these practices. 

VI. Modification of Program Access 

Complaint Procedures 

21. Remedies for Violations. We seek 

comment on whether to add an 

arbitration-type step as part of the 

Commission’s determination of an 

appropriate remedy for program access 

violations. We agree with commenters 

that commercial arbitration requires 

parties to put forth their best effort to 

resolve disputes or risk the arbitrator 

adopting the opposing parties’

proposals. In the Hughes Order, the 

Commission concluded that final offer 

arbitration has the attractive ‘‘ability to 

induce two sides to reach their own 

agreement, lest they risk the possibility 

that a relatively extreme offer of the 

other side may be selected by the 

arbitrator.’’ This type of pressure can 

encourage the parties to resolve their 

differences through settlement. We 

believe that a modified version of this 

method can encourage negotiation 

among the parties. Therefore, we seek 

comment on whether, when feasible, the 

Commission should request, as part of 

its evaluation of the appropriate remedy 

to impose for program access violations, 

that the parties each submit their best 

‘‘final offer’’ proposal for the rates, 

terms, or conditions under review. We 

seek comment on whether the 

Commission should have the discretion 

to adopt one of the parties’ proposals as 

the remedy for the program access 

complaint. 

22. Status of Existing Contract 

Pending Resolution of Program Access 

Complaint. While we declined to adopt 

mandatory arbitration in lieu of the 

Commission’s complaint process in the 

Report and Order, we issue this NPRM 

on the issue of a provision for 

complainants to request a stay of any 

action or proposed action that would 

change an existing program contract that 

is the subject of a program access 

complaint, pending the resolution of the 

program access complaint. Some 

competitive providers recommend a 

‘‘standstill’’ requirement for pre-existing 

carriage contracts during adjudication of 

program access disputes, to preserve the 

status quo until the program access 

complaint has been resolved. In a recent 

merger transaction, in adopting 

conditions for arbitration of program 

access disputes, the Commission 

required that an aggrieved MVPD have 

continued access to the programming in 

question under the terms and conditions 

of the expired contract, pending 

resolution of the dispute. Provision of 

the disputed programming during the 

pendency of arbitration was not 

required in the case of the first time 

requests for programming where no 

carriage agreement had previously 

existed between the parties. Verizon 

supports a five-month long standstill 

provision while complaints are being 

resolved. BSPA, RCN, and USTelecom 

support a standstill provision pending 

the resolution of the complaint, wherein 

carriage is continued and the parties are 

subject to the same price, terms, and 

conditions of the existing contract, with 

any new price arising out of resolution 

to be applied retroactively to the date of 

the complaint. BSPA asserts that 

vertically integrated programmers 

covered by the program access rules 

have incentives to use temporary 

foreclosure strategies during 

negotiations for programming and, 

therefore, standstill agreements should 

be made part of the program access 

complaint procedures. Other parties 

favoring a standstill provision include 

ACA, EchoStar, and SureWest. EchoStar 

asserts that there can be no doubt that 

the Commission has the authority to 

promulgate a standstill requirement as a 

lesser interim remedy where 

interruption of carriage threatens to 

cause irreparable injury to the public. 

23. NCTA opposes any ‘‘standstill’’

provision and states that there is no 

authority that allows the Commission to 

interfere in the right to contract in this 

way. Time Warner asserts that the 

standstill requirement would prohibit a 

network from de-authorizing carriage by 

an MVPD, but would allow the MVPD 

to drop the network, creating an unfair 

bargaining situation. Time Warner 

believes that any standstill requirement 

would increase the likelihood of 

program access complaints because the 

MVPD will have a strong incentive to 

file a complaint just to protect the status 

quo and decrease the chances that 

parties will resolve their disputes 

because the incentive of either party to 

negotiate could be reduced once the 

status quo is protected. Comcast and the 

Broadcast Networks also oppose any 

‘‘standstill’’ requirement. 

24. We agree that the threat of 

temporary foreclosure pending 

resolution of a complaint may impair 

settlement negotiations and may 

discourage parties from filing legitimate 

complaints. In the Adelphia Order, the 

Commission discussed circumstances 

wherein temporary foreclosure of 

programming service may be profitable 

even where permanent foreclosure is 

not. By temporarily foreclosing supply 

of the programming to an MVPD 

competitor or by threatening to engage 

in temporary foreclosure, the integrated 

firm may improve its bargaining 

position so as to be able to extract a 

higher price from the MVPD competitor 

than it could have negotiated if it were 

a non-integrated programming supplier. 

The Commission included, as a measure 

to alleviate such foreclosure strategies, a 

requirement that, upon receiving timely 

notice of an MVPD’s intent to arbitrate, 

program carriage be continued under 

the existing terms and conditions. We 

request comment on whether the 

issuance of temporary stay orders would 

encourage parties to resolve program 

access disputes and to make use of the 

Commission’s complaint procedures 

when needed. We request comment on 

whether complainants must formally 

request such relief from the Commission 

and must establish that they are likely 

to prevail on the merits of their 

complaint; will suffer irreparable harm 

absent a stay; that the balance of harms 

to the parties favors grant of a stay; and 

that the public interest favors grant of 

the stay. We request comment on 

whether, as part of a showing of 

irreparable harm, complainants may 

discuss the likelihood that subscribers 

would switch MVPDs to obtain the 

programming in dispute for a long 

enough period to make the strategy 

profitable to the respondent. We request 

comment on whether these stays should 

be routinely granted when the facts 

support their issuance and that they will 

help to encourage settlement 

negotiations. We request comment on 

the nature of the stay, that is, whether 

both the complainant and the 

respondent will be subject to the stay 

order, and required to fulfill their 

respective obligations under the terms 

and conditions of the carriage contract 

in issue, while the stay is in effect. We 

request comment on whether 

complainants will be permitted to drop 

the programming that is the subject of 

the program access dispute unless and 

until a request to dismiss the complaint 

with prejudice is granted by the 

Commission. We request comment on 

whether the length of the stay should be 

entirely discretionary. Finally, we 

request comment on whether the 

Commission should include, as part of 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61597 

its final order resolving the complaint or 

resolving damages, adjustments to its 

remedies that make the terms of the new 

agreement between the parties 

retroactive to the expiration date of the 

previous agreement. 

VII. Procedural Matters 

A. Ex Parte Rules 

25. Permit-But-Disclose. The NPRM in 

this proceeding will be treated as 

‘‘permit-but-disclose’’ subject to the 

‘‘permit-but-disclose’’ requirements 

under § 1.1206(b) of the Commission’s 

rules. Ex parte presentations are 

permissible if disclosed in accordance 

with Commission rules, except during 

the Sunshine Agenda period when 

presentations, ex parte or otherwise, are 

generally prohibited. Persons making 

oral ex parte presentations are reminded 

that a memorandum summarizing a 

presentation must contain a summary of 

the substance of the presentation and 

not merely a listing of the subjects 

discussed. More than a one- or twosentence description of the views and 

arguments presented is generally 

required. Additional rules pertaining to 

oral and written presentations are set 

forth in § 1.1206(b). 

B. Filing Requirements 

26. Comment Information. Pursuant 

to §§ 1.415 and 1.419 of the 

Commission’s rules, 47 CFR 1.415, 

1.419, interested parties may file 

comments and reply comments on or 

before the dates indicated on the first 

page of this document. Comments may 

be filed using: (1) The Commission’s 

Electronic Comment Filing System 

(ECFS), (2) the Federal Government’s 

eRulemaking Portal, or (3) by filing 

paper copies. See Electronic Filing of 

Documents in Rulemaking Proceedings, 

63 FR 24121, May 1, 1998. 

• Electronic Filers: Comments may be 

filed electronically using the Internet by 

accessing the ECFS: http://www.fcc.gov/ 

cgb/ecfs/ or the Federal eRulemaking 

Portal: http://www.regulations.gov. 

Filers should follow the instructions 

provided on the website for submitting 

comments. 

• For ECFS filers, if multiple docket 

or rulemaking numbers appear in the 

caption of this proceeding, filers must 

transmit one electronic copy of the 

comments for each docket or 

rulemaking number referenced in the 

caption. In completing the transmittal 

screen, filers should include their full 

name, U.S. Postal Service mailing 

address, and the applicable docket or 

rulemaking number. Parties may also 

submit an electronic comment by 

Internet e-mail. To get filing 

instructions, filers should send an email to ecfs@fcc.gov, and include the 

following words in the body of the 

message, ‘‘get form.’’ A sample form and 

directions will be sent in response. 

• Paper Filers: Parties who choose to 

file by paper must file an original and 

four copies of each filing. If more than 

one docket or rulemaking number 

appears in the caption of this 

proceeding, filers must submit two 

additional copies for each additional 

docket or rulemaking number. 

Filings can be sent by hand or 

messenger delivery, by commercial 

overnight courier, or by first-class or 

overnight U.S. Postal Service mail 

(although we continue to experience 

delays in receiving U.S. Postal Service 

mail). All filings must be addressed to 

the Commission’s Secretary, Office of 

the Secretary, Federal Communications 

Commission. 

• The Commission’s contractor will 

receive hand-delivered or messengerdelivered paper filings for the 

Commission’s Secretary at 236 

Massachusetts Avenue, NE., Suite 110, 

Washington, DC 20002. The filing hours 

at this location are 8 a.m. to 7 p.m. All 

hand deliveries must be held together 

with rubber bands or fasteners. Any 

envelopes must be disposed of before 

entering the building. 

• Commercial overnight mail (other 

than U.S. Postal Service Express Mail 

and Priority Mail) must be sent to 9300 

East Hampton Drive, Capitol Heights, 

MD 20743. 

• U.S. Postal Service first-class, 

Express, and Priority mail must be 

addressed to 445 12th Street, SW., 

Washington, DC 20554. 

People with Disabilities: To request 

materials in accessible formats for 

people with disabilities (braille, large 

print, electronic files, audio format), 

send an e-mail to fcc504@fcc.gov or call 

the Consumer & Governmental Affairs 

Bureau at 202–418–0530 (voice), 202–

418–0432 (tty). 

27. Availability of Documents. 

Comments, reply comments, and ex 

parte submissions will be available for 

public inspection during regular 

business hours in the FCC Reference 

Center, Federal Communications 

Commission, 445 12th Street, SW., CY–

A257, Washington, DC 20554. Persons 

with disabilities who need assistance in 

the FCC Reference Center may contact 

Bill Cline at (202) 418–0267 (voice), 

(202) 418–7365 (TTY), or 

bill.cline@fcc.gov. These documents also 

will be available from the Commission’s 

Electronic Comment Filing System. 

Documents are available electronically 

in ASCII, Word 97, and Adobe Acrobat. 

Copies of filings in this proceeding may 

be obtained from Best Copy and 

Printing, Inc., Portals II, 445 12th Street, 

SW., Room CY–B402, Washington, DC 

20554; they can also be reached by 

telephone, at (202) 488–5300 or (800) 

378–3160; by e-mail at 

fcc@bcpiweb.com; or via their Web site 

at http://www.bcpiweb.com. To request 

materials in accessible formats for 

people with disabilities (Braille, large 

print, electronic files, audio format), 

send an e-mail to fcc504@fcc.gov or call 

the Consumer and Governmental Affairs 

Bureau at (202) 418–0531 (voice), (202) 

418–7365 (TTY). 

C. Initial Paperwork Reduction Act of 

1995 Analysis 

28. The NPRM has been analyzed 

with respect to the Paperwork 

Reduction Act of 1995 (PRA), Public 

Law 104–13, and contains proposed 

information collection requirements. 

The Commission, as part of its 

continuing effort to reduce paperwork 

burdens, invites the general public and 

the Office of Management and Budget 

(OMB) to comment on the proposed 

information collection requirements 

contained in this NPRM, as required by 

the PRA. 

29. Written comments on the PRA 

proposed information collection 

requirements must be submitted by the 

public, the OMB, and other interested 

parties on or before December 31, 2007. 

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. 

In addition, pursuant to the Small 

Business Paperwork Relief Act of 2002, 

Public Law 107–198, see 44 U.S.C. 

3506(c)(4), we seek specific comment on 

how we might ‘‘further reduce the 

information collection burden for small 

business concerns with fewer than 25 

employees.’’ In addition to filing 

comments with the Office of the 

Secretary, a copy of any comments on 

the proposed information collection 

requirements contained herein should 

be submitted to Cathy Williams, Federal 

Communications Commission, 445 12th 

St., SW., Room 1–C823, Washington, DC 

20554, or via the Internet at 

PRA@fcc.gov; and also to Nicholas A. 

Fraser of the Office of Management and 

Budget (OMB), via Internet at 


rwilkins on PROD1PC63 with PROPOSALS-1
61598 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

Nicholas_A._Fraser@omb.eop.gov or via 

fax at (202) 395–5167. 

30. Further Information. For 

additional information concerning the 

PRA proposed information collection 

requirements contained in this NPRM, 

contact Cathy Williams at 202–418–

2918, or via the Internet at PRA@fcc.gov. 

D. Initial Regulatory Flexibility Analysis 

31. As required by the Regulatory 

Flexibility Act, the Commission has 

prepared an Initial Regulatory 

Flexibility Analysis (IRFA) of the 

possible significant economic impact on 

a substantial number of small entities of 

the proposals addressed in this NPRM. 

Written public comments are requested 

on the IRFA. These comments must be 

filed in accordance with the same filing 

deadlines for comments on the NPRM. 

Comments must be identified as 

responses to the IRFA. The Commission 

will send a copy of the NPRM, including 

this IRFA, to the Chief Counsel for 

Advocacy of the Small Business 

Administration (SBA). In addition, the 

NPRM and IRFA (or summaries thereof) 

will be published in the Federal 

Register. 

Need for, and Objectives of, the 

Proposed Rules 

32. Overview. The NPRM considers 

Commission action with respect to 

seven issues. First, the Commission is 

considering whether it can establish a 

procedure that would shorten the term 

of the five-year extension of the 

exclusive contract prohibition if, after 

two years (i.e., October 5, 2009) a cable 

operator can show competition from 

new entrant MVPDs has reached a 

certain penetration level in a Designated 

Market Area. Second, the Commission is 

contemplating the extension of its 

program access rules to terrestrially 

delivered cable-affiliated programmers 

in order to facilitate competition in the 

video distribution market. Third, the 

Commission is considering whether to 

expand the exclusive contract 

prohibition to apply to non-cableaffiliated programming that is affiliated 

with a different MVPD, principally a 

Direct Broadcast Satellite (DBS) 

provider. Fourth, the NPRM is 

contemplating whether it may be 

appropriate for the Commission to 

preclude the practice of programmers to 

require multichannel video 

programming distributors (MVPDs) to 

purchase and carry undesired 

programming in return for the ability to 

purchase and carry desired 

programming. The NPRM considers 

whether to instead require programmers 

to offer each of their programming 

services on a stand-alone basis to all 

MVPDs. Fifth, the NPRM contemplates 

action to address concerns raised by 

small and rural MVPDs regarding 

conditions imposed by programmers for 

access to content. The NPRM also 

contemplates revising the Commission’s 

program access complaint procedures in 

two respects. First, the NPRM is 

considering whether to establish a 

process whereby a program access 

complainant may seek a temporary stay 

of any proposed changes to its existing 

programming contract pending 

resolution of a complaint. Second, the 

NPRM contemplates revising the 

Commission’s program access complaint 

procedures by requiring parties to 

submit to the Commission, when 

requested, ‘‘final offer’’ proposals as part 

of the remedy phase of the complaint 

process. Each of these issues is 

discussed in further detail below. 

33. Procedure for Shortening Term of 

Extension of Exclusive Contract 

Prohibition. Section 628(c)(2)(D) of the 

Communications Act prohibits, in areas 

served by a cable operator, exclusive 

contracts for satellite cable 

programming or satellite broadcast 

programming between vertically 

integrated programming vendors and 

cable operators unless the Commission 

determines that such exclusivity is in 

the public interest. See 47 U.S.C. 

548(c)(2)(D). In MB Docket 07–29, the 

Commission decided to extend this 

prohibition for five years, until October 

5, 2012. In light of the five-year 

extension of the exclusivity ban, the 

NPRM considers whether it can 

establish a procedure that would 

shorten the term of the extension if, 

after two years (i.e., October 5, 2009), a 

cable operator can show competition 

from new entrant MVPDs has reached a 

certain penetration level in the DMA. 

The NPRM contemplates what this 

penetration level should be, whether 

two years or some other time frame is 

the appropriate period of time, and 

whether a market-by-market analysis is 

appropriate as both a legal and policy 

matter. 

34. Terrestrially Delivered CableAffiliated Programming. Congress 

enacted the program access provisions 

contained in section 628 of the 

Communications Act of 1934, as 

amended, as part of the Cable Television 

Consumer Protection and Competition 

Act of 1992 (1992 Act). The program 

access provisions are intended to 

increase competition and diversity in 

the multichannel video programming 

market, as well as to foster the 

development of competition to 

traditional cable systems, by prescribing 

regulations that govern the access by 

competing MVPDs to ‘‘satellite cable 

programming’’ and ‘‘satellite broadcast 

programming.’’ The term ‘‘satellite cable 

programming’’ means ‘‘video 

programming which is transmitted via 

satellite and which is primarily 

intended for direct receipt by cable 

operators for their retransmission to 

cable subscribers,’’ except that such 

term does not include satellite broadcast 

programming. 47 U.S.C. 548(i)(1); 47 

U.S.C. 605(d)(1); see also 47 CFR 

76.1000(h). The term ‘‘satellite 

broadcast programming’’ means 

‘‘broadcast video programming when 

such programming is retransmitted by 

satellite and the entity retransmitting 

such programming is not the 

broadcaster or an entity performing such 

retransmission on behalf of and with the 

specific consent of the broadcaster.’’ 47 

U.S.C. 548(i)(3); see also CFR 76.1000(f). 

The Commission has previously 

concluded that terrestrially delivered 

programming (i.e., programming 

transmitted or retransmitted by satellite 

for direct reception by cable operators) 

is not covered by the definitions of 

‘‘satellite cable programming’’ and 

‘‘satellite broadcast programming.’’ See 

2002 Extension Order, 67 FR 49247, July 

30, 2002. Thus, terrestrially delivered 

programming is not subject to the 

program access provisions. The 

Commission has previously found that 

cable operators have withheld 

terrestrially delivered cable-affiliated 

programming from competitive MVPDs 

and that this has resulted in a material 

adverse impact on competition in the 

video distribution market. See Adelphia 

Order, 21 FCC Rcd 8203. To remedy this 

concern, the NPRM considers whether 

to extend the program access provisions 

to all terrestrially delivered cableaffiliated programming pursuant to 

various provisions of the 

Communications Act, such as sections 

4(i), 201(b), 303(r), 601(6), 612(g), 

616(a), 628(b), and 706. The 

Commission also seeks information as to 

whether cable operators, again with 

anti-competitive results, are shifting 

delivery of affiliated programming from 

satellite delivery to terrestrial delivery 

and whether such action is intended to 

evade the program access rules. 

35. Expanding the Exclusive Contract 

Prohibition to Non-Cable-Affiliated 

Programming. The NPRM is considering 

whether to expand the exclusive 

contract prohibition to apply to noncable-affiliated programming that is 

affiliated with a different MVPD, 

principally a DBS provider. To the 

extent that an MVPD meets the 

definition of a ‘‘cable operator’’ under 

the Communications Act, the exclusive 

contract prohibition in section 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61599 

628(c)(2)(D) already applies to its 

affiliated programming. Moreover, 

section 628(j) of the Communications 

Act provides that any provision of 

section 628, including the exclusive 

contract prohibition in section 

628(c)(2)(D), that applies to a cable 

operator also applies to any common 

carrier or its affiliate that provides video 

programming. See 47 U.S.C. 548(j). 

Programming affiliated with other 

MVPDs, such as DBS providers, is 

beyond the scope of the exclusive 

contract prohibition in section 

628(c)(2)(D). The NPRM is considering 

whether to extend the exclusive contract 

prohibition to non-cable-affiliated 

programming that is affiliated with a 

different MVPD, principally a DBS 

provider, pursuant to sections 4(i), 

201(b), 303(r), 601(6), 612(g), 616(a), 

628(b), or 706, or any other provision 

under the Communications Act. 

36. Tying. Various MVPDs have raised 

concerns regarding the practice of some 

programmers to require MVPDs to 

purchase and carry undesired 

programming in return for the right to 

carry desired programming, referred to 

as ‘‘tying.’’ When presented with a tying 

arrangement, MVPDs face two choices. 

First, the MVPD can refuse the tying 

arrangement, thereby potentially 

depriving itself of desired, and often 

economically vital, programming that 

subscribers demand and which may be 

essential to attracting and retaining 

subscribers. Second, the MVPD can 

agree to the tying arrangement, thereby 

incurring costs for programming that its 

subscribers do not demand and may not 

want, with such costs being passed on 

to subscribers in the form of higher 

rates, and also forcing the MVPD to 

allocate channel capacity for the 

unwanted programming in place of 

programming that its subscribers prefer. 

In either case, the MVPD and its 

subscribers are harmed by the refusal of 

the programmer to offer each of its 

programming services on a stand-alone 

basis. The NPRM explains that small 

cable operators and MVPDs are 

particularly vulnerable to such tying 

arrangements because they do not have 

leverage in negotiations for 

programming due to their smaller 

subscriber bases. Given the problems 

associated with such tying 

arrangements, the NPRM is 

contemplating whether it may be 

appropriate for the Commission to 

preclude them and to instead require 

each programming service to be offered 

on a stand-alone basis to all MVPDs. 

The NPRM considers precluding the 

tying practices of broadcasters, satellite 

cable programmers, terrestrially 

delivered cable-affiliated programmers, 

and programmers that are affiliated with 

neither a cable operator nor a 

broadcaster, such as networks affiliated 

with a non-cable MVPD or a nonaffiliated independent programmer. 

37. Concerns Raised by Small and 

Rural MVPDs. Small and rural MVPDs 

have raised concerns regarding obstacles 

they face in trying to obtain access to 

programming which impede 

competition in the video distribution 

marketplace. These obstacles include (i) 

restrictions on the use of shared 

headends for receiving content; (ii) 

requiring small and rural MVPDs to 

enter into mandatory non-disclosure 

agreements with programmers; (iii) 

requiring small and rural MVPDs to 

provide programmers with advertising 

slots; and (iv) mandating unwarranted 

security requirements. The NPRM 

contemplates Commission action to 

address these practices. 

38. Modification of Program Access 

Complaint Procedures. The NPRM also 

contemplates revising the Commission’s 

program access complaint procedures in 

two respects. First, the NPRM 

contemplates adding an arbitration-type 

step as part of the Commission’s 

determination of an appropriate remedy 

for program access violations. The 

NPRM is considering whether, when 

feasible, the Commission should 

request, as part of its evaluation of the 

appropriate remedy to impose for 

program access violations, that the 

parties each submit their best ‘‘final 

offer’’ proposal for the rates, terms or 

conditions under review. The NPRM 

considers whether the Commission 

should have the discretion to adopt one 

of the parties’ proposals as the remedy 

for the program access complaint. 

Second, the NPRM is considering 

whether to allow complainants to 

request a stay of any action or proposed 

action that would change an existing 

program contract that is the subject of a 

program access complaint, pending the 

resolution of the program access 

complaint. In the NPRM, the 

Commission agrees that the threat of 

temporary foreclosure pending 

resolution of a complaint may impair 

settlement negotiations and may 

discourage parties from filing legitimate 

complaints. The NPRM thus 

contemplates whether the issuance of 

temporary stay orders would encourage 

parties to resolve program access 

disputes and to make use of the 

Commission’s complaint procedures 

when needed. The NPRM considers 

whether complainants should be 

required to formally request such relief 

from the Commission and establish that 

they are likely to prevail on the merits 

of their complaint; will suffer 

irreparable harm absent a stay; that the 

balance of harms to the parties favors 

grant of a stay; and that the public 

interest favors grant of the stay. The 

NPRM also considers whether, as part of 

a showing of irreparable harm, 

complainants may discuss the 

likelihood that subscribers would 

switch MVPDs to obtain the 

programming in dispute for a long 

enough period to make the strategy 

profitable to the respondent. The NPRM 

further contemplates whether these 

stays should be routinely granted when 

the facts support their issuance and that 

they will help to encourage settlement 

negotiations. The NPRM considers the 

nature of the stay, that is, whether both 

the complainant and the respondent 

will be subject to the stay order, and 

required to fulfill their respective 

obligations under the terms and 

conditions of the carriage contract in 

issue, while the stay is in effect. The 

NPRM also contemplates whether 

complainants will be permitted to drop 

the programming that is the subject of 

the program access dispute unless and 

until a request to dismiss the complaint 

with prejudice is granted by the 

Commission. The NPRM considers 

whether the length of the stay should be 

entirely discretionary. The NPRM also 

considers whether the Commission 

should include, as part of its final order 

resolving the complaint or resolving 

damages, adjustments to its remedies 

that make the terms of the new 

agreement between the parties 

retroactive to the expiration date of the 

previous agreement. 

39. In the NPRM, the Commission 

seeks comment on the foregoing issues. 

In particular, the NPRM invites 

comment on issues that may impact 

small entities, including MVPDs and 

programmers. 

Legal Basis 

40. The authority for the action 

proposed in the rulemaking is contained 

in section 4(i), 303, and 628 of the 

Communications Act of 1934, as 

amended, 47 U.S.C. 154(i), 303, and 

548. 

Description and Estimate of the Number 

of Small Entities to Which the Proposed 

Rules Will Apply 

41. The RFA directs agencies to 

provide a description of, and where 

feasible, an estimate of the number of 

small entities that may be affected by 

the proposed rules, if adopted. See 5 

U.S.C. 603(b)(3). The RFA generally 

defines the term ‘‘small entity’’ as 

having the same meaning as the terms 

‘‘small business,’’ ‘‘small organization,’’


rwilkins on PROD1PC63 with PROPOSALS-1
61600 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

and ‘‘small governmental jurisdiction.’’

See 5 U.S.C. 601(6). In addition, the 

term ‘‘small business’’ has the same 

meaning as the term ‘‘small business 

concern’’ under the Small Business Act. 

See 5 U.S.C. 601(3). A ‘‘small business 

concern’’ is one which: (1) Is 

independently owned and operated; (2) 

is not dominant in its field of operation; 

and (3) satisfies any additional criteria 

established by the Small Business 

Administration (SBA). See 15 U.S.C. 

632. 

42. Wired Telecommunications 

Carriers. The 2007 North American 

Industry Classification System (NAICS) 

defines ‘‘Wired Telecommunications 

Carriers’’ (2007 NAISC Code 517110) to 

include the following three 

classifications which were listed 

separately in the 2002 NAICS: Wired 

Telecommunications Carriers (2002 

NAICS Code 517110), Cable and Other 

Program Distribution (2002 NAISC Code 

517510), and Internet Service Providers 

(2002 NAISC Code 518111). The 2007 

NAISC defines this category as follows: 

‘‘This industry comprises 

establishments primarily engaged in 

operating and/or providing access to 

transmission facilities and infrastructure 

that they own and/or lease for the 

transmission of voice, data, text, sound, 

and video using wired 

telecommunications networks. 

Transmission facilities may be based on 

a single technology or a combination of 

technologies. Establishments in this 

industry use the wired 

telecommunications network facilities 

that they operate to provide a variety of 

services, such as wired telephony 

services, including VoIP services; wired 

(cable) audio and video programming 

distribution; and wired broadband 

Internet services. By exception, 

establishments providing satellite 

television distribution services using 

facilities and infrastructure that they 

operate are included in this industry.’’

The SBA has developed a small 

business size standard for Wired 

Telecommunications Carriers, which is 

all firms having 1,500 employees or less. 

According to Census Bureau data for 

2002, there were a total of 27,148 firms 

in the Wired Telecommunications 

Carriers category (2002 NAISC Code 

517110) that operated for the entire 

year; 6,021 firms in the Cable and Other 

Program Distribution category (2002 

NAISC Code 517510) that operated for 

the entire year; and 3,408 firms in the 

Internet Service Providers category 

(2002 NAISC Code 518111) that 

operated for the entire year. Of these 

totals, 25,374 of 27,148 firms in the 

Wired Telecommunications Carriers 

category (2002 NAISC Code 517110) had 

less than 100 employees; 5,496 of 6,021 

firms in the Cable and Other Program 

Distribution category (2002 NAISC Code 

517510) had less than 100 employees; 

and 3,303 of the 3,408 firms in the 

Internet Service Providers category 

(2002 NAISC Code 518111) had less 

than 100 employees. Thus, under this 

size standard, the majority of firms can 

be considered small. 

43. Cable and Other Program 

Distribution. The 2002 NAICS defines 

this category as follows: ‘‘This industry 

comprises establishments primarily 

engaged as third-party distribution 

systems for broadcast programming. The 

establishments of this industry deliver 

visual, aural, or textual programming 

received from cable networks, local 

television stations, or radio networks to 

consumers via cable or direct-to-home 

satellite systems on a subscription or fee 

basis. These establishments do not 

generally originate programming 

material.’’ This category includes, 

among others, cable operators, direct 

broadcast satellite (DBS) services, home 

satellite dish (HSD) services, satellite 

master antenna television (SMATV) 

systems, and open video systems (OVS). 

The SBA has developed a small 

business size standard for Cable and 

Other Program Distribution, which is all 

such firms having $13.5 million or less 

in annual receipts. According to Census 

Bureau data for 2002, there were a total 

of 1,191 firms in this category that 

operated for the entire year. Of this 

total, 1,087 firms had annual receipts of 

under $10 million, and 43 firms had 

receipts of $10 million or more but less 

than $25 million. Thus, under this size 

standard, the majority of firms can be 

considered small. 

44. Cable System Operators (Rate 

Regulation Standard). The Commission 

has also developed its own small 

business size standards for the purpose 

of cable rate regulation. Under the 

Commission’s rules, a ‘‘small cable 

company’’ is one serving 400,000 or 

fewer subscribers nationwide. As of 

2006, 7,916 cable operators qualify as 

small cable companies under this 

standard. In addition, under the 

Commission’s rules, a ‘‘small system’’ is 

a cable system serving 15,000 or fewer 

subscribers. Industry data indicate that 

6,139 systems have under 10,000 

subscribers, and an additional 379 

systems have 10,000–19,999 

subscribers. Thus, under this standard, 

most cable systems are small. 

45. Cable System Operators (Telecom 

Act Standard). The Communications 

Act of 1934, as amended, also contains 

a size standard for small cable system 

operators, which is ‘‘a cable operator 

that, directly or through an affiliate, 

serves in the aggregate fewer than 1 

percent 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.’’ There are approximately 

65.4 million cable subscribers in the 

United States today. Accordingly, an 

operator serving fewer than 654,000 

subscribers shall be deemed a small 

operator, if its annual revenues, when 

combined with the total annual 

revenues of all its affiliates, do not 

exceed $250 million in the aggregate. 

Based on available data, we find that the 

number of cable operators serving 

654,000 subscribers or less totals 

approximately 7,916. We note that the 

Commission neither requests nor 

collects information on whether cable 

system operators are affiliated with 

entities whose gross annual revenues 

exceed $250 million. Although it seems 

certain that some of these cable system 

operators are affiliated with entities 

whose gross annual revenues exceed 

$250,000,000, we are unable at this time 

to estimate with greater precision the 

number of cable system operators that 

would qualify as small cable operators 

under the definition in the 

Communications Act. 

46. Direct Broadcast Satellite (DBS) 

Service. DBS service is a nationally 

distributed subscription service that 

delivers video and audio programming 

via satellite to a small parabolic ‘‘dish’’

antenna at the subscriber’s location. 

Because DBS provides subscription 

services, DBS falls within the SBArecognized definition of Cable and 

Other Program Distribution. This 

definition provides that a small entity is 

one with $13.5 million or less in annual 

receipts. Currently, three operators 

provide DBS service, which requires a 

great investment of capital for operation: 

DIRECTV, EchoStar (marketed as the 

DISH Network), and Dominion Video 

Satellite, Inc. (Dominion) (marketed as 

Sky Angel). All three currently offer 

subscription services. Two of these 

three DBS operators, DIRECTV and 

EchoStar Communications Corporation 

(EchoStar), report annual revenues that 

are in excess of the threshold for a small 

business. The third DBS operator, 

Dominion’s Sky Angel service, serves 

fewer than one million subscribers and 

provides 20 family and religion-oriented 

channels. Dominion does not report its 

annual revenues. The Commission does 

not know of any source which provides 

this information and, thus, we have no 

way of confirming whether Dominion 

qualifies as a small business. Because 

DBS service requires significant capital, 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61601 

we believe it is unlikely that a small 

entity as defined by the SBA would 

have the financial wherewithal to 

become a DBS licensee. Nevertheless, 

given the absence of specific data on 

this point, we recognize the possibility 

that there are entrants in this field that 

may not yet have generated $13.5 

million in annual receipts, and therefore 

may be categorized as a small business, 

if independently owned and operated. 

47. Private Cable Operators (PCOs) 

also known as Satellite Master Antenna 

Television (SMATV) Systems. PCOs, 

also known as SMATV systems or 

private communication operators, are 

video distribution facilities that use 

closed transmission paths without using 

any public right-of-way. PCOs acquire 

video programming and distribute it via 

terrestrial wiring in urban and suburban 

multiple dwelling units such as 

apartments and condominiums, and 

commercial multiple tenant units such 

as hotels and office buildings. The SBA 

definition of small entities for Cable and 

Other Program Distribution Services 

includes PCOs and, thus, small entities 

are defined as all such companies 

generating $13.5 million or less in 

annual receipts. Currently, there are 

approximately 150 members in the 

Independent Multi-Family 

Communications Council (IMCC), the 

trade association that represents PCOs. 

Individual PCOs often serve 

approximately 3,000–4,000 subscribers, 

but the larger operations serve as many 

as 15,000–55,000 subscribers. In total, 

PCOs currently serve approximately one 

million 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 PCOs, we believe that a substantial 

number of PCOs may qualify as small 

entities. 

48. Home Satellite Dish (HSD) 

Service. Because HSD provides 

subscription services, HSD falls within 

the SBA-recognized definition of Cable 

and Other Program Distribution, which 

includes all such companies generating 

$13.5 million or less in revenue 

annually. HSD or the large dish segment 

of the satellite industry is the original 

satellite-to-home service offered to 

consumers, and involves the home 

reception of signals transmitted by 

satellites operating generally in the Cband frequency. Unlike DBS, which 

uses small dishes, HSD antennas are 

between four and eight feet in diameter 

and can receive a wide range of 

unscrambled (free) programming and 

scrambled programming purchased from 

program packagers that are licensed to 

facilitate subscribers’ receipt of video 

programming. There are approximately 

30 satellites operating in the C-band, 

which carry over 500 channels of 

programming combined; approximately 

350 channels are available free of 

charge, and 150 are scrambled and 

require a subscription. HSD is difficult 

to quantify in terms of annual revenue. 

HSD owners have access to program 

channels placed on C-band satellites by 

programmers for receipt and 

distribution by MVPDs. Commission 

data shows that, between June 2004 and 

June 2005, HSD subscribership fell from 

335,766 subscribers to 206,358 

subscribers, a decline of more than 38 

percent. The Commission has no 

information regarding the annual 

revenue of the four C-Band distributors. 

49. Broadband Radio Service and 

Educational Broadband Service. 

Broadband Radio Service comprises 

Multichannel Multipoint Distribution 

Service (MMDS) systems and 

Multipoint Distribution Service (MDS). 

MMDS systems, often referred to as 

‘‘wireless cable,’’ transmit video 

programming to subscribers using the 

microwave frequencies of MDS and 

Educational Broadband Service (EBS) 

(formerly known as Instructional 

Television Fixed Service (ITFS)). We 

estimate that the number of wireless 

cable subscribers is approximately 

100,000, as of March 2005. As 

previously noted, the SBA definition of 

small entities for Cable and Other 

Program Distribution, which includes 

such companies generating $13.5 

million in annual receipts, appears 

applicable to MDS and ITFS. 

50. The Commission has also defined 

small MDS (now BRS) entities in the 

context of Commission license auctions. 

For purposes of the 1996 MDS auction, 

the Commission defined a small 

business as an entity that had annual 

average gross revenues of less than $40 

million in the previous three calendar 

years. This definition of a small entity 

in the context of MDS auctions has been 

approved by the SBA. In the MDS 

auction, 67 bidders won 493 licenses. Of 

the 67 auction winners, 61 claimed 

status as a small business. At this time, 

the Commission estimates that of the 61 

small business MDS auction winners, 48 

remain small business licensees. In 

addition to the 48 small businesses that 

hold BTA authorizations, there are 

approximately 392 incumbent MDS 

licensees that have gross revenues that 

are not more than $40 million and are 

thus considered small entities. MDS 

licensees and wireless cable operators 

that did not receive their licenses as a 

result of the MDS auction fall under the 

SBA small business size standard for 

Cable and Other Program Distribution, 

which includes all such entities that do 

not generate revenue in excess of $13.5 

million annually. Information available 

to us indicates that there are 

approximately 850 of these licensees 

and operators that do not generate 

revenue in excess of $13.5 million 

annually. Therefore, we estimate that 

there are approximately 850 small entity 

MDS (or BRS) providers, as defined by 

the SBA and the Commission’s auction 

rules. 

51. Educational institutions are 

included in this analysis as small 

entities; however, the Commission has 

not created a specific small business 

size standard for ITFS (now EBS). We 

estimate that there are currently 2,032 

ITFS (or EBS) licensees, and all but 100 

of the licenses are held by educational 

institutions. Thus, we estimate that at 

least 1,932 ITFS licensees are small 

entities. 

52. Local Multipoint Distribution 

Service. Local Multipoint Distribution 

Service (LMDS) is a fixed broadband 

point-to-multipoint microwave service 

that provides for two-way video 

telecommunications. The SBA 

definition of small entities for Cable and 

Other Program Distribution, which 

includes such companies generating 

$13.5 million in annual receipts, 

appears applicable to LMDS. The 

Commission has also defined small 

LMDS entities in the context of 

Commission license auctions. In the 

1998 and 1999 LMDS auctions, the 

Commission defined a small business as 

an entity that had annual average gross 

revenues of less than $40 million in the 

previous three calendar years. 

Moreover, the Commission added an 

additional classification for a ‘‘very 

small business,’’ which was defined as 

an entity that had annual average gross 

revenues of less than $15 million in the 

previous three calendar years. These 

definitions of ‘‘small business’’ and 

‘‘very small business’’ in the context of 

the LMDS auctions have been approved 

by the SBA. In the first LMDS auction, 

104 bidders won 864 licenses. Of the 

104 auction winners, 93 claimed status 

as small or very small businesses. In the 

LMDS re-auction, 40 bidders won 161 

licenses. Based on this information, we 

believe that the number of small LMDS 

licenses will include the 93 winning 

bidders in the first auction and the 40 

winning bidders in the re-auction, for a 

total of 133 small entity LMDS 

providers as defined by the SBA and the 

Commission’s auction rules. 


rwilkins on PROD1PC63 with PROPOSALS-1
61602 Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 

53. Open Video Systems (OVS). The 

OVS framework provides opportunities 

for the distribution of video 

programming other than through cable 

systems. Because OVS operators provide 

subscription services, OVS falls within 

the SBA-recognized definition of Cable 

and Other Program Distribution 

Services, which provides that a small 

entity is one with $13.5 million or less 

in annual receipts. The Commission has 

approved approximately 120 OVS 

certifications with some OVS operators 

now providing service. Broadband 

service providers (BSPs) are currently 

the only significant holders of OVS 

certifications or local OVS franchises, 

even though OVS is one of four 

statutorily-recognized options for local 

exchange carriers (LECs) to offer video 

programming services. As of June 2005, 

BSPs served approximately 1.4 million 

subscribers, representing 1.49 percent of 

all MVPD households. Among BSPs, 

however, those operating under the OVS 

framework are in the minority. As of 

June 2005, RCN Corporation is the 

largest BSP and 14th largest MVPD, 

serving approximately 371,000 

subscribers. RCN received approval to 

operate OVS systems in New York City, 

Boston, Washington, DC and other 

areas. The Commission does not have 

financial information regarding the 

entities authorized to provide OVS, 

some of which may not yet be 

operational. We thus believe that at least 

some of the OVS operators may qualify 

as small entities. 

54. Cable and Other Subscription 

Programming. The Census Bureau 

defines this category as follows: ‘‘This 

industry comprises establishments 

primarily engaged in operating studios 

and facilities for the broadcasting of 

programs on a subscription or fee 

basis. * * * These establishments 

produce programming in their own 

facilities or acquire programming from 

external sources. The programming 

material is usually delivered to a third 

party, such as cable systems or directto-home satellite systems, for 

transmission to viewers.’’ The SBA has 

developed a small business size 

standard for firms within this category, 

which is all firms with $13.5 million or 

less in annual receipts. According to 

Census Bureau data for 2002, there were 

270 firms in this category that operated 

for the entire year. Of this total, 217 

firms had annual receipts of under $10 

million and 13 firms had annual 

receipts of $10 million to $24,999,999. 

Thus, under this category and 

associated small business size standard, 

the majority of firms can be considered 

small. 

55. Small Incumbent Local Exchange 

Carriers. We have included small 

incumbent local exchange carriers in 

this present RFA analysis. A ‘‘small 

business’’ under the RFA is one that, 

inter alia, meets the pertinent small 

business size standard (e.g., a telephone 

communications business having 1,500 

or fewer employees), and ‘‘is not 

dominant in its field of operation.’’ The 

SBA’s Office of Advocacy contends that, 

for RFA purposes, small incumbent 

local exchange carriers are not dominant 

in their field of operation because any 

such dominance is not ‘‘national’’ in 

scope. We have therefore included small 

incumbent local exchange carriers in 

this RFA, although we emphasize that 

this RFA action has no effect on 

Commission analyses and 

determinations in other, non-RFA 

contexts. 

56. Incumbent Local Exchange 

Carriers (LECs). Neither the Commission 

nor the SBA has developed a small 

business size standard specifically for 

incumbent local exchange services. The 

appropriate size standard under SBA 

rules is for the category Wired 

Telecommunications Carriers. Under 

that size standard, such a business is 

small if it has 1,500 or fewer employees. 

According to Commission data, 1,307 

carriers have reported that they are 

engaged in the provision of incumbent 

local exchange services. Of these 1,307 

carriers, an estimated 1,019 have 1,500 

or fewer employees, and 288 have more 

than 1,500 employees. Consequently, 

the Commission estimates that most 

providers of incumbent local exchange 

services are small businesses. 

57. Competitive Local Exchange 

Carriers, Competitive Access Providers 

(CAPs), ‘‘Shared-Tenant Service 

Providers,’’ and ‘‘Other Local Service 

Providers.’’ Neither the Commission nor 

the SBA has developed a small business 

size standard specifically for these 

service providers. The appropriate size 

standard under SBA rules is for the 

category Wired Telecommunications 

Carriers. Under that size standard, such 

a business is small if it has 1,500 or 

fewer employees. According to 

Commission data, 859 carriers have 

reported that they are engaged in the 

provision of either competitive access 

provider services or competitive local 

exchange carrier services. Of these 859 

carriers, an estimated 741 have 1,500 or 

fewer employees and 118 have more 

than 1,500 employees. In addition, 16 

carriers have reported that they are 

‘‘Shared-Tenant Service Providers,’’ and 

all 16 are estimated to have 1,500 or 

fewer employees. In addition, 44 

carriers have reported that they are 

‘‘Other Local Service Providers.’’ Of the 

44, an estimated 43 have 1,500 or fewer 

employees and one has more than 1,500 

employees. Consequently, the 

Commission estimates that most 

providers of competitive local exchange 

service, competitive access providers, 

‘‘Shared-Tenant Service Providers,’’ and 

‘‘Other Local Service Providers’’ are 

small entities. 

58. Electric Power Generation, 

Transmission and Distribution. The 

Census Bureau defines this category as 

follows: ‘‘This industry group comprises 

establishments primarily engaged in 

generating, transmitting, and/or 

distributing electric power. 

Establishments in this industry group 

may perform one or more of the 

following activities: (1) Operate 

generation facilities that produce 

electric energy; (2) operate transmission 

systems that convey the electricity from 

the generation facility to the distribution 

system; and (3) operate distribution 

systems that convey electric power 

received from the generation facility or 

the transmission system to the final 

consumer.’’ The SBA has developed a 

small business size standard for firms in 

this category: ‘‘A firm is small if, 

including its affiliates, it is primarily 

engaged in the generation, transmission, 

and/or distribution of electric energy for 

sale and its total electric output for the 

preceding fiscal year did not exceed 4 

million megawatt hours.’’ According to 

Census Bureau data for 2002, there were 

1,644 firms in this category that 

operated for the entire year. Census data 

do not track electric output and we have 

not determined how many of these firms 

fit the SBA size standard for small, with 

no more than 4 million megawatt hours 

of electric output. Consequently, we 

estimate that 1,644 or fewer firms may 

be considered small under the SBA 

small business size standard. 

59. Television Broadcasting. The SBA 

defines a television broadcast station as 

a small business if such station has no 

more than $13.0 million in annual 

receipts. Business concerns included in 

this industry are those ‘‘primarily 

engaged in broadcasting images together 

with sound.’’ The Commission has 

estimated the number of licensed 

commercial television stations to be 

1,376. According to Commission staff 

review of the BIA Financial Network, 

MAPro Television Database (BIA) on 

March 30, 2007, approximately 986 of 

an estimated 1,374 commercial 

television stations (or approximately 72 

percent) have revenues of $13.5 million 

or less. We note, however, that, in 

assessing whether a business concern 

qualifies as small under the above 

definition, business (control) affiliations 

must be included. Our estimate, 


rwilkins on PROD1PC63 with PROPOSALS-1
Federal Register / Vol. 72, No. 210 / Wednesday, October 31, 2007 / Proposed Rules 61603 

therefore, likely overstates the number 

of small entities that might be affected 

by our action, because the revenue 

figure on which it is based does not 

include or aggregate revenues from 

affiliated companies. The Commission 

has estimated the number of licensed 

NCE television stations to be 380. The 

Commission does not compile and 

otherwise does not have access to 

information on the revenue of NCE 

stations that would permit it to 

determine how many such stations 

would qualify as small entities. 

60. In addition, an element of the 

definition of ‘‘small business’’ is that the 

entity not be dominant in its field of 

operation. We are unable at this time to 

define or quantify the criteria that 

would establish whether a specific 

television station is dominant in its field 

of operation. Accordingly, the estimate 

of small businesses to which rules may 

apply do not exclude any television 

station from the definition of a small 

business on this basis and are therefore 

over-inclusive to that extent. Also, as 

noted, an additional element of the 

definition of ‘‘small business’’ is that the 

entity must be independently owned 

and operated. We note that it is difficult 

at times to assess these criteria in the 

context of media entities and our 

estimates of small businesses to which 

they apply may be over-inclusive to this 

extent. 

Description of Proposed Reporting, 

Recordkeeping and Other Compliance 

Requirements 

61. The rules ultimately adopted as a 

result of this NPRM may contain new or 

modified information collections. We 

anticipate that none of the changes 

would result in an increase to the 

reporting and recordkeeping 

requirements of small entities. We invite 

small entities to comment in response to 

the NPRM. 

Steps Taken to Minimize Significant 

Impact on Small Entities and Significant 

Alternatives Considered 

62. The RFA requires an agency to 

describe any significant alternatives that 

it has considered in proposing 

regulatory approaches, which may 

include the following four alternatives 

(among others): (1) The establishment of 

differing compliance or reporting 

requirements or timetables that take into 

account the resources available to small 

entities; (2) the clarification, 

consolidation, or simplification of 

compliance or reporting requirements 

under the rule for small entities; (3) the 

use of performance, rather than design, 

standards; and (4) an exemption from 

coverage of the rule, or any part thereof, 

for small entities. First, regarding the 

establishment of a procedure that would 

shorten the five-year term of the 

extension of the exclusive contract 

prohibition, the Commission may 

choose to establish such a procedure or, 

in the alternative, it may not choose to 

do so. Second, regarding the extension 

of the program access rules to 

terrestrially delivered cable-affiliated 

programmers, the Commission may 

choose to extend these rules to 

terrestrially delivered cable-affiliated 

programmers or, in the alternative, it 

may choose not to extend these rules to 

such programmers. Third, regarding 

expansion of the exclusive contract 

prohibition to apply to non-cableaffiliated programming that is affiliated 

with a different MVPD, principally a 

DBS provider, the Commission may 

choose to extend the exclusive contract 

prohibition to apply to such non-cableaffiliated programming or, in the 

alternative, it may choose not to extend 

the exclusive contract prohibition to 

such programming. Fourth, regarding 

the practice of programmers to engage in 

tying of desired with undesired 

programming, the Commission may 

choose to preclude all such tying 

arrangements or, in the alternative, it 

may choose not to preclude any such 

arrangements or, in the alternative, it 

may choose to preclude only certain 

tying arrangements. Fifth, with respect 

to concerns raised by small and rural 

MVPDs regarding conditions imposed 

by programmers for access to content, 

the Commission may choose to take 

action to address some or all of these 

concerns or, in the alternative, it may 

choose not to take action to address 

these concerns. Sixth, regarding the 

establishment of a process whereby a 

program access complainant may seek a 

temporary stay of any proposed changes 

to its existing programming contract 

pending resolution of the complaint, the 

Commission may establish such a 

process or, in the alternative, it may 

choose not to establish such a process. 

Seventh, regarding the requirement that 

parties submit to the Commission, when 

requested, ‘‘final offer’’ proposals as part 

of the remedy phase of the complaint 

process, the Commission may adopt 

such a requirement or, in the 

alternative, it may choose not to adopt 

such a requirement. We invite comment 

on the options the Commission is 

considering, or alternatives thereto as 

referenced above, and on any other 

alternatives commenters may wish to 

propose for the purpose of minimizing 

significant economic impact on smaller 

entities. 

Federal Rules Which Duplicate, 

Overlap, or Conflict With the 

Commission’s Proposals 

63. None. 

F. Additional Information 

64. For additional information on this 

proceeding, contact Steven Broeckaert, 

Steven.Broeckaert@fcc.gov; David 

Konczal, David.Konczal@fcc.gov; or 

Katie Costello, Katie.Costello@fcc.gov; of 

the Media Bureau, Policy Division, (202) 

418–2120. 

VIII. Ordering Clauses 

65. Accordingly, it is ordered, 

pursuant to the authority found in 

sections 4(i), 303(r), and 628 of the 

Communications Act of 1934, as 

amended, 47 U.S.C. 154(i), 303(r), and 

548, this Notice of Proposed 

Rulemaking Is Adopted. 

66. It is further ordered that the 

Commission’s Consumer and 

Governmental Affairs Bureau, Reference 

Information Center, shall send a copy of 

this Notice of Proposed Rulemaking, 

including the Initial Regulatory 

Flexibility Analysis, to the Chief 

Counsel for Advocacy of the Small 

Business Administration. 

Federal Communications Commission. 

Marlene H. Dortch, 

Secretary. 

[FR Doc. 07–5388 Filed 10–30–07; 8:45 am] 

BILLING CODE 6712–01–P 

DEPARTMENT OF DEFENSE 

GENERAL SERVICES 

ADMINISTRATION 

NATIONAL AERONAUTICS AND 

SPACE ADMINISTRATION 

48 CFR Parts 7, 8, 12, and 39 

[FAR Case 2005–014; Docket 2007-0001; 

Sequence 9] 

RIN 9000–AK83 

Federal Acquisition Regulation; FAR 

Case 2005–014, SmartBUY 

AGENCIES: Department of Defense (DoD), 

General Services Administration (GSA), 

and National Aeronautics and Space 

Administration (NASA). 

ACTION: Proposed rule. 

SUMMARY: The Civilian Agency 

Acquisition Council and the Defense 

Acquisition Regulations Council 

(Councils) are proposing to amend the 

Federal Acquisition Regulation (FAR) to 

implement the Governmentwide 

Enterprise Software Licensing Program, 


rwilkins on PROD1PC63 with PROPOSALS-1