‘‘(2) DEFINITION.—The term ‘cable program-
ming vendor’ means a person engaged in the produc-
tion, creation, or wholesale distribution for sale of 
video programming which is primarily intended for 
the direct receipt by cable operators for their re-
transmission to cable subscribers. 
‘‘(o) GROSS REVENUES.—As used in this section: 
‘‘(1) IN GENERAL.—Subject to paragraphs (2) 
and (3), the term ‘gross revenues’ means all consid-
eration of any kind or nature, including cash, cred-
its, property, and in-kind contributions (services or 
goods) received by the cable operator from the provi-
sion of cable service within the franchise area. 
‘‘(2) INCLUDED ITEMS.—Subject to paragraph 
(3), the term ‘gross revenues’ shall include the fol-
lowing: 
‘‘(A) all charges and fees paid by sub-
scribers for the provision of cable service, in-
cluding fees attributable to cable service when 
sold individually or as part of a package or bun-
dle, or functionally integrated, with services 
other than cable service; 
‘‘(B) any franchise fee imposed on the 
cable operator that is passed on to subscribers; 
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‘‘(C) compensation received by the cable 
operator for promotion or exhibition of any 
products or services over the cable service, such 
as on ‘home shopping’ or similar programming; 
‘‘(D) revenue received by the cable oper-
ator as compensation for carriage of video pro-
gramming or other programming service on 
that operator’s cable service; 
‘‘(E) all revenue derived from the cable op-
erator’s cable service pursuant to compensation 
arrangements for advertising; and 
‘‘(F) any advertising commissions paid to 
an affiliated third party for cable services ad-
vertising. 
‘‘(3) EXCLUDED ITEMS.—The term ‘gross reve-
nues’ shall not include the following: 
‘‘(A) any revenue not actually received, 
even if billed, such as bad debt net of any re-
coveries of bad debt; 
‘‘(B) refunds, rebates, credits, or discounts 
to subscribers or a municipality to the extent 
not already offset by subparagraph (A) and to 
the extent such refund, rebate, credit, or dis-
count is attributable to the cable service; 
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‘‘(C) subject to paragraph (4), any reve-
nues received by the cable operator or its affili-
ates from the provision of services or capabili-
ties other than cable service, including tele-
communications services, Internet access serv-
ices, and services, capabilities, and applications 
that may be sold as part of a package or bun-
dle, or functionally integrated, with cable serv-
ice; 
‘‘(D) any revenues received by the cable 
operator or its affiliates for the provision of di-
rectory or Internet advertising, including yellow 
pages, white pages, banner advertisement, and 
electronic publishing; 
‘‘(E) any amounts attributable to the pro-
vision of cable service to customers at no 
charge, including the provision of such service 
to public institutions without charge; 
‘‘(F) any tax, fee, or assessment of general 
applicability imposed on the customer or the 
transaction by a Federal, State, or local govern-
ment or any other governmental entity, col-
lected by the provider, and required to be remit-
ted to the taxing entity, including sales and use 
taxes and utility user taxes; 
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‘‘(G) any forgone revenue from the provi-
sion of cable service at no charge to any person, 
except that any forgone revenue exchanged for 
trades, barters, services, or other items of value 
shall be included in gross revenue; 
‘‘(H) sales of capital assets or surplus 
equipment; 
‘‘(I) reimbursement by programmers of 
marketing costs actually incurred by the cable 
operator for the introduction of new program-
ming; and 
‘‘(J) the sale of cable services for resale to 
the extent the purchaser certifies in writing 
that it will resell the service and pay a franchise 
fee with respect thereto. 
‘‘(4) FUNCTIONALLY INTEGRATED SERVICES.— 
In the case of a cable service that is bundled or inte-
grated functionally with other services, capabilities, 
or applications, the portion of the cable operator’s 
revenue attributable to such other services, capabili-
ties, or applications shall be included in gross rev-
enue unless the cable operator can reasonably iden-
tify the division or exclusion of such revenue from 
its books and records that are kept in the regular 
course of business. 
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