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In the Matter of AMENDMENT OF PART 74, SUBPART K, OF THE COMMISSION'S RULES AND REGULATIONS RELATIVE TO COMMUNITY ANTENNA TELEVISION SYSTEMS; AND INQUIRY INTO THE DEVELOPMENT OF COMMUNICATIONS TECHNOLOGY AND SERVICES TO FORMULATE REGULATORY POLICY AND RULEMAKING AND/OR LEGISLATIVE PROPOSALS; AMENDMENT OF SECTION 74.1107 OF THE COMMISSION'S RULES AND REGULATIONS TO AVOID FILING OF REPETITIOUS REQUESTS; AMENDMENT OF SECTION 74.1031(c) AND 74.1105 (a) AND (b) OF THE COMMISSION'S RULES AND REGULATIONS AS THEY RELATE TO ADDITION OF NEW TELEVISION SIGNALS; AMENDMENT OF PART 74, SUBPART K, OF THE COMMISSION'S RULES AND REGULATIONS RELATIVE TO FEDERAL-STATE OR LOCAL RELATIONSHIPS IN THE COMMUNITY ANTENNA TELEVISION SYSTEM FIELD; AND/OR FORMULATION OF LEGISLATIVE PROPOSALS IN THIS RESPECT; AMENDMENT OF SUBPART K OF PART 74 OF THE COMMISSION'S RULES AND REGULATIONS WITH RESPECT TO TECHNICAL STANDARDS FOR COMMUNITY ANTENNA TELEVISION SYSTEMS

Part 2 of 2 

36 F.C.C.2d 143

Dockets Nos. 18397; 18397-A Docket No. 18373;

Docket No. 18416; Docket No. 18892; Docket No. 18894

February 3, 1972 Released

Adopted February 2, 1972 


 

JUDGES: BY THE COMMISSION: COMMISSIONERS BURCH, CHAIRMAN; BARTLEY, REID, AND WILEY CONCURRING AND ISSUING STATEMENTS; COMMISSIONER ROBERT E. LEE DISSENTING AND ISSUING A STATEMENT; COMMISSIONER JOHNSON CONCURRING IN PART AND DISSENTING IN PART AND ISSUING A STATEMENT; COMMISSIONER H. REX LEE ABSENT.

OPINION:

CABLE TELEVISION REPORT AND ORDER

SUPPLEMENTARY OPINION OF COMMISSIONER NICHOLAS JOHNSON

CONCURBY: BURCH; BARTLEY; JOHNSON (IN PART); REID; WILEY

CONCUR:

CONCURRING STATEMENT OF CHAIRMAN BURCH

Prologue

Since the day I joined the Federal Communications Commission, on October 31, 1969, one of the most complex, controversial and significant issues we have had to face has been the shaping of a regulatory program for cable television.  In this we have been fortunate.  Only rarely does a governmental body have the opportunity to take part in an act of genuine creation -- in this instance, to turn a corner in communications technology that holds the promise at least of a whole new era of service to the American people.  I believe the Commission's response has been in keeping with its opportunity: months of painstaking study, measured deliberation, culminating in regulatory craftsmanship of a high order.  We have grounds for pride in a signal accomplishment.

During this same period of time, I and the other Commissioners have been exposed to an incessant barrage of vilification, willful misrepresentation, and left-handed slander issuing from our colleague, Commissioner Johnson.  I have chosen in this Concurring Statement to respond in some detail to his latest polemic, not because it is particularly better or worse than the run of his performances n1 but because of the unusual importance of the subject matter.  And more, because he is essentially a performer, he is good copy.  This means that his attempt to distort an act of creation into a public obscenity may end up becoming the story of the Commission's cable program.  I find this insupportable and, charged as I am with leadership of this Commission (but speaking here for myself only), I am not about to let it go unchallenged. 

n1 For samples of Commissioner Johnson in typical form, see Rolling Stone, April 1, 1971; Penthouse, February 1972; and Keynote Address, 3rd Annual Conference, International Association of Political Consultants, London, December 14, 1970.

There is another consideration that outweighs any reluctance I might feel about entering the lists.  The end product of the regulatory craft is inherently unglamorous.  It is all but incomprehensible to the layman.  And because it generally melds a mixed bag of competing, conflicting options, a set of rules is at best a pale copy of the good, the true, and the beautiful.  Responsible policymakers recognize the imperfections of their craft.  They operate reluctantly but resignedly within the bounds of the possible.

Not so Commissioner Johnson.  In the manner of demagogues, he elevates gross simplification to the level of a moral imperative.  For him all differences are by definition dishonest.  Accommodation and compromise equal "sellouts".  Any desire to preserve what we have -- warts and all -- can only be motivated by "greed".  Commissioner Johnson's world is peopled wholly by white hats and black hats, and every role is type-cast in advance.  I almost envy him the simplicity of his perspective.  But I cannot wallow with him in the luxury of his irresponsibility.

And that, I am forced to conclude, is the explanation.  Commissioner Johnson is preeminently an "irresponsible" in a policymaking milieu where complexities are the order of the day and simplistic answers no longer suffice.  He practices the "scorched earth" technique -- and, from his viewpoint, why not?  Exploitable issues are what interest him, not practical results.  He trafficks in bombast, not the undramatic reality of incremental progress.  Today his target of opportunity is cable television -- and if public comprehension of this emerging but largely untested technology is the necessary sacrifice, so much the worse for public comprehension.  There is, as I suggest, a certain grandeur about his simplistic approach to a policy area so crowded with imponderables.  But, for a Commissioner with undeniable capabilities and even charismatic powers, what a vast waste!

The Commission's Cable Program

Commissioner Johnson launches his critique of the Cable Television Report and Order (adopted February 2, 1972) from an irony, and it's downhill thereafter.  The irony, of course, is that he has the sheer brass to accuse the Commission majority of locking the door on cable's entry into the major television markets when it was they -- three of whom cast their first key cable votes in the proceeding just concluded -- who acted to institute a modest thaw and he -- as recently as December 1968 -- who helped perpetuate a virtual freeze.  That was the clear effect of past Commission decisions in which he participated, and (at p. 16 of his Opinion) he admits as much.  n2

n2 Commissioner Johnson is confused even about what it was he was voting for.  He seems to have the 1966 Second Report (in which he did not participate) mixed up with the 1968 Notice (in which he did).  Under the rules in effect from 1966 until March 31, 1972, a cable system may not import a distant signal into a top 100 market without first going through a lengthy hearing (Section 74.1107(a)).  Contrary to Commissioner Johnson's impression, this hearing process is automatic, not dependent on a broadcaster's objection.  The definitive such hearing was the 1968 Midwest Television, Inc. case (13 FCC 2d 478) in which Commissioner Johnson cast the crucial fourth vote to maintain the "freeze" of the Second Report.

Like most newly-saved sinners, however, Commissioner Johnson would now more to the opposite extreme.  His self-styled "market place" model contemplates unlimited distant signal importation -- which, in his projection, would mean about 8-to-15 broadcast signals in the major markets -- with little regard to impact on local television service.  Commissioner Johnson would, to be sure, throw two bones to local broadcasters.  He proposes but never really explains "simultaneous non-duplication" protection for programming being shown on local signals (which would mean just about nothing so far as non-network syndicated material is concerned) n3 and special relief where a local station can demonstrate that cable competition is forcing it to the wall. 

n3 It is interesting to note that this is a wholly new proposal.  Never before, to my recollection, has Commissioner Johnson offered this idea for his colleagues' benefit.

But to say "the sky's the limit" and then try later to apply the brakes is a prescription for regulatory disaster.  Even in the context of the Commission's market-tailored "adequate service" formula, we must of course be prepared to apply the brakes -- and we explicitly reserve the authority to do so where a showing is made that such relief is warranted.  But surely it is sound policy to act conservatively from the outset, so that "special cases" rarely arise.  And that, as Commissioner Johnson knows perfectly well, is precisely what the Commission has done.  With regard to carriage rules, the fundamental rationale of the Cable Television Report and Order is to fix the number of signals (local and distant) at the minimum necessary to assure adequate service and get cable moving, while still tying its ultimate development (and success) to the provision of the services that are unique to cable technology -- access channels, cablecast originations, and leased channel services.

Again, there is particular irony in Commissioner Johnson's concentration on distant signal importation and his only passing reference (at pp. 8 and 9) to cable's non-broadcast services.  Throughout the recent proceeding, he was an eloquent advocate for cable's unique capabilities -- well beyond simply moving broadcast signals around -- so much so, in fact, as to threaten cable's viability by loading on the burdens of "free" services.  But now Commissioner Johnson is working the other side of the street, the better to chastise his colleagues for giving cable so few additional signals as to lock it out of the major television markets.  Whatever else one can say about him, Commissioner Johnson is flexible.

But he is very nearly silent on the issue that has long been at the core of the controversy over cable's future -- and that is cable's standing outside the competitive market for television programming.  Commissioner Johnson acknowledges (p. 6) that copyright owners "should be compensated for the use of their product by cable systems" but argues that regulations to implement their ownership rights "need not take the form of exclusivity." Rather, they "could simply require the automatic payment of fees to copyright holders."

The question is, what regulations?  Not this Commission's, to be sure, because we have no power to legislate copyright payments (and Commissioner Johnson agrees on this point).  Regulation by the Congress then? But for reasons that I'll turn to in due course, and as Commissioner Johnson knows perfectly well, Congress has been unable to pass cable copyright legislation -- and even assuming such legislation were passed, it clearly would take the form of exclusivity protection, not simply compulsory licenses, in the major television markets.  The House bill did so (H.R. 2512, 90th Cong.) and so did S. 543 (91st Cong.) and S. 644 (92nd Cong.).  There simply is no realistic prospect for the kind of Congressional regulation that Commissioner Johnson banks  on -- and he knows it.

In that case, how about the courts?  But, to the courts, the issue is not one of fashioning an appropriate regulatory approach.  The Supreme Court in Fortnightly (392 U.S. at 401-402) made it clear that only Congress can do that.  The Court's job was to say whether signal carriage by cable is or is not a "performance" within the meaning of the 1909 Copyright Law, and it held that carriage of off-the-air signals (Grade B contour and just beyond), is not.  The still open question -- in CBS v. TelePromptTer, S.D.N.Y. -- is whether cable carriage of distant signals via microwave comes within the 1909 Law.  A difficult question indeed.  But my point here is that Commissioner Johnson's "market place" model rests foursquare on the contingency that cable, not CBS, will win the TelePrompTer case.  If cable should lose, the model collapses.  Even if cable wins, he will not have satisfied his own objective -- which is that copyright owners be fairly compensated for the use of their product.

Commissioner Johnson is simply trying to slide past one of the gut issues of the cable controversy: that cable remains an uneasy outsider with respect to the programming market.   And only when it is brought within that market, when its right to the use of its basic product is secure and regularized, only then will its future be unclouded.  It is this issue that the Federal Communications Commission can neither resolve nor avoid.  For this among many reasons, our August 5 Letter of Intent to the Congress was not and is not sufficient unto itself as a way to end the freeze and get cable moving.

The Consensus Agreement

The ultimate answer must finally be found in legislation, as the Supreme Court made clear in Fortnightly.  But the obstacle to legislation has long been the ability of any or all the contending industries -- cable, broadcasting, copyright -- to block any particular legislative approach with which they might take issue.  Congressional leaders have repeatedly called on the industries to reach some fair and reasonable accommodation.  n4 The Commission has also urged them to compromise their differences and pave the way for legislation, most recently in the August 5 Letter.  All these efforts have been unavailing. 

n4 See, for example, my recent exchange of letters with Senator McClellan, published as Appendix E to the Cable Television Report and Order.

After we outlined our regulatory program in the August 5 Letter, it seemed to me that the time was right for another try.  Broadcasters were understandably nervous that this program would go into effect and the TelPrompTer case might go against them; cable was equally concerned about the outcome of litigation and the need to put itself on a solid base; and copyright owners were anxious to protect their major source of revenue in the top television markets.  Then, too, the Office of Telecommunications Policy had a cable study under way, and all the principals were pressing their viewpoints in that forum.  I joined OTP, therefore, in an effort to secure a consensus among the industries that would lead to resolution of the cable/copyright issue, de-escalate the level of violence, and thus greatly serve the public interest.  There was no great secret about any of these developments.  They were widely reported in the trade press.  I would only point out, from my perspective as Chairman of the Commission, the practical difficulties of inviting a seven-member Commission to sit around the bargaining table or to take part in conference calls with the various parties.

It is patent nonsense for Commissioner Johnson to assert that the consensus agreement thus hammered out resulted from the efforts of the "powerful broadcast industry" to force a "sweetheart deal" down this Commission's throat.  In fact, if I were to assess the varying degrees with which the principals have decided to accept the agreement -- and all of them have some reservations -- I would put the copyright owners first, cable second, and broadcasters a very distant third.  Surely Commissioner Johnson has read Dr. Frank Stanton's letter of January 4, 1972, and Mr. C. Wrede Petersmeyer's of January 17th -- both of which excoriate the Commission's regulatory program and the consensus agreement about equally.  They both know that, with this agreement, there has been substantial progress toward the peace table (and toward legislation that will put cable on a sound footing).  Both know that there is now the promise at least of an end to the warfare.  Their motives are perfectly understandable.  They fear the unknown.  It seems to me that Commissioner Johnson's motives are equally understandable but much less commendable -- that the threat of "peace breaking out" robs him of an issue.  Significantly, Commissioner Johnson ignores the public interest considerations that are stated in the Cable Television Report and Order (pars. 61-67, and particularly 65) as the basis for our decision to implement the agreement.  Because they do not fit into his scenario of an all-powerful broadcaster-White House "conspiracy", they simply do not exist for him.

I have already stated that my own motives were to find the basis for a consensus that would be reasonable, fair, and consistent with the public interest.  I believe the November agreement meets the test.  Using the August 5 Letter as a benchmark, there were two modifications in our earlier plan and one major addition -- and I want to examine each in turn.

First, there was a change in the "viewing standard" (the test for defining a nearby-market signal as in effect a local signal) from a one percent audience share to a two percent, with respect to independent stations.  I cannot believe that Commissioner Johnson or anyone else seriously believes this change undercuts our August 5 proposal.  It affects only 11 core cities and 16 signals, and cable's future in the major markets clearly does not turn on such (to use the Commission's own phrase in the Report and Order) "variations on a theme".  Commissioner Johnson uses the example of Baltimore signals in Washington, D.C.  But the fact is, there is no variation at all as to the signals that may be carried in the Baltimore-Washington markets, whether the viewing standard is set at one or two percent.  n5

n5 There would be great variation if cable systems were permitted to carry all signals that could be picked up with an antenna, as Commissioner Johnson suggests (p. 13).  But this is a far cry from "rabbit ears" viewability.  He unsuccessfully tried out this approach back in May or June.

With respect to leapfrogging (the carriage rules that in general favor closer rather than more distant stations), the August 5 Letter imposed one set of restrictions and the consensus agreement another -- both of them reasonable, and both of them a mixture of pluses and minuses from the viewpoint of broadcasters and cable systems.  It is important to note that when a distant signal must be blacked out because of exclusivity protection, we have imposed no restriction on point of origin for substitute programming.  And this catches Commissioner Johnson in a flat contradiction.  He argues, on the one hand, that there will be extensive blackouts (p. 12) and, on the other, he alleges that the leapfrogging requirements are now much more onerous for cable (p. 14).  He is right about the first, and dead wrong about the second.

The addition to our August 5 proposal, and the core of the consensus agreement, is the exclusivity protection that will be afforded to non-network programming -- protection for local broadcasters against distant stations and, more fundamentally, for the owner's rights to control the use of his product.  This does represent a change from August 5, where we recognized the issue but promised merely to study it further.  And, in my view, it represents a marked improvement.  In the first place, exclusivity should be dealt with by the Commission, not left to Congress, because it is a complex area of regulation that will require revision and refinement as we accumulate experience with the effect of our rules.  Moreover, it is important -- both to cable and to broadcasting -- to protect the copyright owner's continued ability to produce programming; and his right to sell "exclusives" in the major television markets is a key consideration in this respect.  But after one terse reference to the owner's rights (p. 6), Commissioner Johnson simply drops that component of the public interest equation.

He grudgingly admits that, in the context of the consensus agreement as incorporated in the Commission's exclusivity rules, "cable will be able to make a very modest start in some of the smallest markets" (p. 11).  This is a distortion of the grossest sort.  Under our rules, there will now be some chance for cable growth in markets 1-100 for the first time.  n6 This will be true even in the top 50 markets where exclusivity is greatest.  Eleven of these markets have no independent television service at all.  Three imported signals will represent a substantial boost; and, even with run-of-contract protection, there is a good deal of programming available beyond what the three network affiliates have purchased.  And there are another 17 of the top 50 markets with only one independent station: here, too, our rules should give cable an opening. 

n6 In markets 51-100, contrary to Commissioner Johnson's assertion, there will be at most one-year protection for off-network series; the two years to which he refers applies to feature films.  And because many of these series will already have been shown in a particular market, there will be no blackout at all.

He notes (p. 15) that there is no exclusivity afforded in smaller markets and says these were "given" to cable by broadcasters and copyright owners.  But in the below top 100 markets -- far from being "given" to cable -- cable systems are limited to a 3-1 carriage formula.

Commissioner Johnson is quite right that cable will have no easy time of it in the very largest of the top markets where there is already a great deal of television service.  That is true under the rules just adopted.  And it was true under the terms of the August 5 proposal.  In markets like New York and Los Angeles, for example, we have always recognized that a few additional television signals may not be enough to sell cable -- that its ability to get started in such markets will be largely dependent on the new, non-broadcast services that are unique to cable, and on its ability to serve select audiences.  But what I do not comprehend is how Commissioner Johnson can equate the opening to cable of over two-thirds of the top 100 markets with "a very modest start in some of the smallest markets".  He is wrong.  He must know it.  And he must know, too, that he is distorting reality -- complex as it may be -- just to grab a few flashy headlines.  n7

n7 The extent of his success is plain.  The New York Times of February 4, 1972, for example, ran its cable story under the two-column head, "New Rules on Cable TV Limit Growith in Cities".  (Interestingly, The Washington Post -- same day, same rules -- headlined its story, "FCC Opens the Door to Let Cable TV Into Major Cities".) A further measure of Commissioner Johnson's success in distorting the cable story is the Times editorial of February 14, 1972: "... and Cable TV".

Finally, Commissioner Johnson sends up a barrage of procedural objections in his attempt to shoot down the consensus agreement.  The principal one -- that it was dictated by "fat cat" broadcast interests -- is, as I've noted, the purest of fiction.  He also asserts (p. 9) that it was forced on the cable industry "who felt threatened by the political power of the broadcasters -- once joined by Chairman Burch and the President".  I never presume to speak for the President, but for myself this assertion is sheer fabrication.  I made it clear to the participants in the negotiations that, absent any agreement, I would propose to go forward on the basis of the August 5 Letter.  But I made it equally clear that, in my view, the agreement would marked serve the public interest and their interest because (to say it again) it dealt with the gut issues of exclusivity and copyright, and would facilitate legislation.  I don't for a moment doubt that all the parties would have preferred to win all their points and that they did give way on some.  Which, after all, is the nature of consensus.  But I have no doubt either about their judgment, on balance, that the agreement did serve their interests.  That is why they entered into it.

Commissioner Johnson argues further (pp. 22-24) that we have unconstitutionally delegated our powers to industry and that I, in particular, then rammed external fiat down the Commissioners' throats.  Wrong again.  Nothing was forced on the Commissioners and -- as a full participant in several weeks of deliberation of every nuance of the consensus agreement -- Commissioner Johnson knows it.  He also knows that he lost.  We debated the details of the agreement. We debated the necessity of implementing it in its entirety. We debated its probable impact on the passage of cable/copyright legislation, and the critical importance of such legislation to cable's assured future.  We went over every square inch of the ground -- and then went over it again.  And, in the end, we voted: a majority of the Commissioners explicitly decided that the public interest would be served by the Commission's implementation of the agreement.  No conspiracy.  No arm-twisting.  No secret deals.  Just an open debate and an open vote -- and, as I've noted, Commissioner Johnson lost.

As one last shot, Commissioner Johnson asserts (pp. 20-21) that we have trampled on the rights of the public to full participation in our processes.  But on all the matters addressed in the consensus agreement -- exclusivity, leapfrogging, overlapping market signals -- the Commission gave full notice of the "subject matter and issues", as required by the Administrative Procedures Act, and full opportunity for public comment.  For several years running, we have been inundated with comments, studies, analyses, and projections of probable impact.

But none of these comments gave us a detailed blueprint of cable regulations.  That the Commission had to craft for itself, out of the public input and its own experience.  The August 5 Letter outlined such a reasonable blueprint.  And Commissioner Johnson does not argue that we should have put those proposals out for public comment -- far from it (pp. 27-28).  I agree.  But so too did we have full public comment when we had to consider the details of the November consensus agreement.  We had no sudden need for additional comment on such matters as leapfrogging or the viewing standard or even exclusivity.  Most important, the fundamental judgment to be made -- whether implementation of the agreement would contribute to a resolution  of the underlying controversy -- was a quasi-legislative policy determination.  And here comment would not have helped: this was a judgment for each Commissioner to make, in his own wisdom and conscience.

Epilogue

Perhaps one the premier orators and students of the English language to serve in the United States Senate was Henry Fountain Ashurst of Arizona.  I often reread some of his published speeches and am ever amazed at the timeliness of his thoughts and ideas.  Let me bring this statement to a close with a paraphrase of a speech given by Senator Ashurst on the floor of the Senate on June 15, 1935:

It is not for me to pass judgment on Commissioner Johnson.  He has as much right to pas judgment upon me as I have to appraise him.  An attitude of censoriousness is the one attitude this Commission never tolerates and never forgives any of its members, but I will venture the suggestion that if Commissioner Johnson should look into his mirror objectively, as he doubtless will some day, he will distinctly perceive a man frequently disrespectful of the rights and feelings of others, exalting himself with an unwarranted sense of superiority over those less gifted and less fortunate  than himself; a man too often taking undue advantage of his position here; a man of reckless abandon in speech and relentless in his forays upon those two disagree with him.


CONCURRING STATEMENT OF COMMISSIONER ROBERT T. BARTLEY

The largest broadcast stations and representatives of the copyright owners have again succeeded in preventing the development of cable in most of the largest markets, thus depriving receiving set owners of the opportunity to subscribe, if they wish, to enjoy clearer reception and additional services.

I am mystified by the willingness of the representatives of the copyright owners to retard the development of an alternative market for their product; however, as the Commission has so often said, copyright protection is a matter for Congress.

It is clear, however, that until there is copyright legislation applicable to cable, the opponents of cable can continue to prevent its growth.

While I view the action here, in large measure, as another freeze in many markets, there is enough thaw around the edges to prove cable's worth in some new markets and demolish the bugaboo that cable will destroy over-the-air, advertiser-supported television.

I place particular reliance upon the Commission's declaration in Paragraph 66 of the Report and Order that it retains regulatory flexibility to shape cable's evolution.  Legislation which must follow will only limit the number of distant signals to which compulsory copyright licenses apply.  n1 In all other respects, the Commission retains full freedom and, indeed, the responsibility to act as future developments warrant. 

n1 Those specified in Sections 76.59, 76.61 and 76.63 of the Rules.

Accordingly, I concur.


SUPPLEMENTARY OPINION OF COMMISSIONER NICHOLAS JOHNSON

“I never gave the Republicans hell.  I just told the truth and they thought it was hell.”

President Harry S. Truman

There has been a controversy in Washington, D.C., recently regarding yet another bridge across the Potomac River, the "Three Sisters Bridge" -- so named because of the three small islands in the river where it would cross.

Those who build highways thought it necessary to their scheme of things.  Those who seek mass rapid transit systems -- joined by environmentalists -- opposed the bridge.

The National Capital Planning Commission originally included the bridge in its comprehensive transportation plan. It then deleted it.  Six months later Representative Natcher, Chairman of the Subcommittee of the District of Columbia of the House Appropriations Committee, "suggested" that if the bridge were not built he would see to it that money for the construction of the planned subway system was denied.  The Commission then revived the bridge plan.

The process for revival required that Secretary of Transportation John Volpe approve the building of the bridge.  He did so, and the building commenced.  Disappointed protesters appealed, arguing among other things that it was inappropriate for the Secretary to take into consideration Congressional pressure.  On April 6, 1970, the United States Court of Appeals for the District of Columbia Circuit remanded the decision to the trial court for an evidentiary hearing to determine whether the Secretary had complied with the pertinent provisions of law in reviving the bridge.  D.C. Federation of Civic Associations v. Volpe, 434 F. 2d 436 (D.C. Cir. 1970). After hearing, the case again came before the Court of Appeals.  In a landmark decision, the Court reversed the decision of the Secretary.  D.C. Federation of Civic Associations v. Volpe.     F. 2d     D.C. Cir.,  October 12, 1970).

Because of the remarkable parallel between the issue in that case and the one before us I would like to quote at greater length than usual from Judge Bazelon's opinion.

The author of this opinion is convinced that the impact of this pressure [the threat by Representative Natcher to withhold funds needed to complete the subway] is sufficient, standing alone, to invalidate the Secretary's action.  Even if the Secretary had taken every formal step required by every applicable statutory provision, reversal would be required, in my opinion, because extraneous pressure intruded into the calculus of considerations on which the Secretary's decision was based.

* * *

While Judge Fahy is not entirely convinced that the District Court ultimately found as a fact that the extraneous pressure had influenced the Secretary's decision -- a point which is for me clear -- he has authorized me to note his concurrence in my discussion of the controlling principle of law: namely, that the decision would be invalid if based in whole or in part on the pressures emanating from Representative Natcher.  Judge Fahy agrees, and we therefore hold, that on remand the Secretary must make new determinations based strictly on the merits and completely without regard to any considerations not made relevant by Congress in the applicable statutes.

* * *

[The] underlying problem cannot be illuminated by a simplistic effort to force the Secretary's action into a purely judicial or purely legislative mold.  His decision was not "judicial" in that he was not required to base it solely on a formal record established at a public hearing.  At the same time, it was not purely "legislative" since Congress had already established the boundaries within which his discretion could operate.  But even though his action fell between these two conceptual extremes, it is still governed by principles that we had thought elementary and beyond dispute.  If, in the course of reaching his decision, Secretary Volpe took into account "considerations that Congress could not have intended to make relevant," his action proceeded from an erroneous premise and his decision cannot stand.  The error would be more flagrant, of course, if the Secretary had based his decision solely on the pressures generated by Representative Natcher.  But it should be clear that his action would not be immunized merely because he also considered some relevant factors.

* * *

We do not hold, in other words, that the bridge can never be built.  Nor do we know or mean to suggest that the information now available to the Secretary is necessarily insufficient to justify construction of the bridge.  We hold only that the Secretary must reach his decision strictly on the merits and in the manner prescribed by statute, without reference to irrelevant or extraneous considerations.

For the purposes of the foregoing discussion, we have assumed that pressures exerted by Congressional advocates of the bridge are irrelevant to the merits of the questions presented to Secretary Volpe.  It does not seem possible to make even a colorable argument of relevance except with regard to   138; but it might be argued that the potential loss of the subway was the type of "unique problem" and cost of "extraordinary magnitude" that the Secretary could properly consider in deciding, pursuant to   138; that there were not prudent alternatives to the use of parkland for the bridge.  The Secretary plainly understood that the price of abandoning, modifying, or even delaying construction of the bridge was the loss of appropriations for the District's subway.  He undoubtedly viewed the prospect of that loss with understandable alarm, and may have concluded that the destruction of parkland was inescapable and appropriate in the face of Representative Natcher's clear and enforceable threat.  We cannot agree, however, that a determination grounded on that reasoning, would satisfy the requirements of 138.

* * *

The "unusual situation" posited here is entirely the product of the action of a small group of men with strongly-held views on the desirability of the bridge, who, it may be assumed, are acting with the interests of the public at heart.  They may well be correct in concluding that a new bridge is needed and that no alternative location is available.  But no matter how sound their reasoning nor how lofty their motives, they cannot usurp the function vested by Act of Congress in the Secretary of Transportation.

* * *

To avoid any misconceptions about the nature of our holding, we emphasize that we have not found -- nor, for that matter, have we sought -- any suggestion of impropriety or illegality in the actions of Representative Natcher and others who strongly advocate the bridge.  They are surely entitled to their own views on the need for the Three Sisters Bridge, and we indicate no opinion on their authority to exert pressure on Secretary Volpe.  Nor do we mean to suggest that Secretary Volpe acted in bad faith or in deliverate disregard of his statutory responsibilities.  He was placed, through the action of others, in an extremely treacherous position.  Our holding is designed, if not to extricte him from that position, at least to enhance his ability to obey the statutory command notwithstanding the difficult position in which he was placed.  D.C. Federation of Civil Associations v. Volpe,     F. 2d     (D.C. Cir., October 12, 1971) (slip opinion at 24-31) (footnotes omitted) (emphasis supplied).

After all the rhetoric, euphemisms, and ad hominum arguments are stripped away from Chairman Burch's outburst, the most significant issue dividing us is symbolized by this case.

We disagree on some of the specific details of the August 5th and February 4th policy statements.  Those disagreements have been fairly thoroughly canvassed in our opinions of February 9th and 16th.  We were, after all, shoulder-to-shoulder on the August 5th policy statement, and I have had nothing but praise for the Chairman's leadership in bringing us through some innovative hearings to that position.  To the extent we differ as to the likelihood of the extent and location of the cable "freeze" brought about by our new rules I can only hope that history will prove him to be right and me wrong.  To the extent we differ as to my sincerity and effectiveness in making long-range substantive contributions to communications policy in the United States (including cable television policy), once again we will have to await the future judgment of those that follow us.  It would be impossible, as well as inappropriate, for me to prepare today the catalog of change effected during an exciting first six years of my seven year term. 

No, the differences between us that matter -- differences that I would have hoped could be addressed without personal rancor -- involve the propriety of the fact, and the process, of our yielding to what can only be described as industry (and potential Congressional) pressure.

It is factual, not "dishonest," "irresponsible," or an "oversimplification," to assert that the FCC had formulated a near-unanimous statement of what the public interest called for in cable television policy on August 5, 1971.It is a fact that Chairman Burch and I voted together -- without separate statements -- on that policy.  It is a fact that it was sent to the United States Senate and House of Representatives with the representation that it was to become national cable policy.

It is a fact that closed meetings were subsequently held under the auspices of the White House, and that Chairman Burch participated in those meetings with a representative of the President of the United States.  It is a fact that the other Commissioners did not participate in those meetings, and that they were not simultaneously briefed as to their existence or substance.  It is a fact that the industry representatives involved represented what can fairly be called "big business." It is a fact that no representatives of the public were present -- nor, for that matter, representatives of small market television station operators.

It is a fact that the Commissioners were subsequently presented with a "fait accompli" -- they could accept the new policy in its entirety or not at all.  It is a fact that they accepted it because of representations that, otherwise, industry, White House and Congressional pressures would halt our August 5th policy.

I believe such a procedure was wrong, inappropriate, despicable -- call it what you will.  I believe it was politically unnecessary, for reasons I spelled out in my February 9th statement.  I believe it may also have been illegal.

None of this has anything to do with my personal feelings about Dean Burch or President Nixon.  Nor does it have to do with my unwillingness to compromise -- the August 5th statement represented a considerable accommodation to the practical politics of broadcasters' power.  It has to do with the outer reaches of propriety in administrative procedure.

Whether or not our procedures may also be found to have actually violated the law remains to be seen.  The Three Sisters Bridge case seems close to this one -- almost directly applicable if one substitutes "Commission" for "Secretary," and "cable compromise" for "bridge." Whatever the law may prove to be, however, my principal disagreement is with the impropriety and the appearance.  In an age when cynicism is rampant about the federal government in general and the FCC in particular, I believe we have an obligation to give the public cause for more confidence rather than less.


CONCURRING STATEMENT OF COMMISSIONER CHARLOTTE T. REID

I concur in the action taken today by the Commission. 

The enactment of these new Cable Television Rules will, hopefully, provide for the further development of cable television systems.

While I do not find myself in complete accord with each and every item set forth in the new Rules, the fact that these rules reflect the consensus agreement reached by the principal parties (cable television system owners, broadcasters and copyright owners) are far better than no rules at all.  It, therefore, seems clearly in the public interest to give implementation to the compromise agreement and for that reason, I concur with the results of the Commission's action.

We must be fully aware however, that there may be problems in some areas.  A particular concern to me, is the impact which these rules may have on broadcasters located in the smaller markets.  It is for this reason that we have provided that the Rules do not become effective until March 31, 1972.  Should there be difficulties, persons affected thereby may bring these to the Commission's attention in their Petitions for Reconsideration.

I wish to reiterate that I feel that the action taken by the Commission is definitely a step in the right direction, and that it conforms to the basic intent of the August 5 letter.  Our action should now provide Congress with a foundation for the enactment of copyright legislation in further implementation of the compromise agreement.


CONCURRING STATEMENT OF COMMISSIONER RICHARD E. WILEY

The cable television program which this Commission has wrought is the attempted settlement, after years of experience and recent months of intensive study and analysis, of one of the most complex and difficult problems ever presented to any administrative body, I is, in its very essence, a compromise: between diverse industry groups, between competing technologies, between a plethora of different viewpoints and, in the final analysis, between various Commission members on myriad points of substance and form.  As such, it is -- indisputably -- not a perfect document.  It is not even the document which, left to our druthers, each of us perhaps would have written.  But so it is with any compromise -- something which, in its four corners, fully satisfies no one.

Edmund Burke has said: "All government -- indeed... every prudent act -- is founded on compromise." Ultimately, I have been persuaded that the adoption of this compromise package for the further development of cable television in this country is, administratively, a prudent act.  The choice realistically confronting the Commission, after all, was this particular program -- or none at all.  And faced with this choice, I have selected the former with certain personal reservations of which I would like briefly to take note.

Throughout our deliberations on this program, my profound concern has been that, in permitting cable television with its great promise of potentially new and significant services to the public to develop, we not in the process destroy or unduly impair the service which over-the-air television has long provided to American citizens.  My apprehension in this regard has focused particularly on smaller broadcasters whose service to rural and sparsely populated areas of our country generally has been, in my opinion, very much in the public interest.  And, sad to say, it is sometimes smaller entities whose voices are less heard and heeded when a compromise is attained. In this connection, while by no means everything which some small broadcasters urged was required, I am heartened by the provisions of the Report and Order which indicate that the Commission will continue to scrutinize carefully the impact of cable television penetration on such public service broadcast operations and will, where necessary to insure that local service will not disappear or be unduly dissipated, extend special relief or adjust its program accordingly.  I take these provisions very seriously and intend to hold the Commission to its word in this regard.

Similarly, I have been concerned that the Commission, to date, has devoted far too scant attention and analysis to the question of cable's impact on existing radio service to the public.  For this reason, I strongly favor the further inquiry which the FCC has decided to conduct in this important area and am satisfied that the interim provisions of the Commission's Notice of Proposed Rule Making will effectively preserve the status quo while we make an expeditious but intensive examination of this entire subject.

Finally, while a majority of the Commission felt that permitting addition comment on our cable television rules was not required, I am mollified by its action in delaying the effective date of the rules beyond the 30 days ordinarily required so that we may consider petitions for reconsideration prior to the rules becoming operative.

I would like to close by affirming, for the record, the fact that I, as a Commissioner, was given every opportunity during our prolonged deliberations to express my own personal viewpoint on the very complicated issues involved in this entire matter.  In my opinion, the same was true of each of my colleagues.  If our procedures in bringing this cable package to fruition were in any way out of the ordinary, I believe it is also fair to say that the problem with which we were grappling was eminently out of the ordinary.  Fundamentally, the decision which each member of the Commission had to address was whether or not the compromises involved resulted in a program which, in the final analysis, serves the public interest.

I have made that decision.  I concur.


DISSENTBY: WELLS; LEE; JOHNSON (IN PART)

DISSENT:

DISSENTING STATEMENT OF COMMISSIONER ROBERT WELLS

I would have preferred to concur in the action of the majority in the adoption of this document for we all have the same goals.  Our objective is to provide for the further development of cable television systems, done in such a manner that we do not disrupt or diminish the service now being brought to the public by the broadcasting industry.  Since we all wanted to achieve this goal, most of our differences are matters of degree.

However a segment of the action taken by the majority represents another example of over regulation at the Federal level.  It was done without local franchising authorities having an adequate opportunity to demonstrate their ability or inability in this complex field.

We do not have before us a case of federal funding where some federal controls are inevitable.  We have preempted jurisdiction where for various reasons the basic requirements for these systems vary from one franchise area to another.  Rather gratuitously the majority has assumed that all expertise in this matter is at the Federal Communications Commission.  It is true that the Commission has held many hours of hearings and discussions on cable television and should be more informed than most local franchising authorities in many aspects.  This does not mean that the Commission has acquired the necessary skills required to deal with local problems which reasonably can be expected to arise in such a complex field.  The rationale for assuming our expertise in local situations, which is thought to be so great so as to preclude even giving local authorities any control over what is needed in the way of local access channels, escapes me.

While I would favor a nationwide interconnected cable television network, at this time I oppose allowing signals to be imported from any distance as is proposed in the document before us.  The possibility of adverse impact by such signals upon existing broadcast services is of grave concern.  I would have been more cautious now, hoping that experience would permit us to come to the point where all restrictions might be abolished.

Stating my objections briefly, I believe we could have given cable systems less in distant signal importation and still stimulated its growth.  On the other hand, I would not have the Commission burdening cable operators with what could prove to be excessive capital outlays because of our proposals for non-broadcast channel capacity.  I am sure that in some cases our channel capacity requirements will prove to be quite reasonable.  The local franchising authorities are in the best position to make that determination and I would leave the matter of access channels entirely to them.  Neither would I make any reference to franchise fees or subscriber rates for these again should be left to the judgment of the local authority, and the Commission should not preempt this jurisdiction.

Although I realize any distinction between markets by size is purely arbitrary, I would have preferred a figure other than markets 1-50.  For the purpose of this subject, the placing of Wilkes-Barre, Pennsylvania in the same category as New York City is not logical when one considers the question of the ability of the Wilkes-Barre market to withstand the impact of additional distant signal competition.  Again, I realize any figure is open to argument, but I do feel we could have arrived at a better division.

I also see the Commission's action as one which will result in a substantial number of requests for waivers from the cable television systems in the many different areas covered by these proposals. Such requests would, in my judgment, have been far fewer in number if local issues had remained for the local authorities' determination, and decisions could be handled far more expeditiously.

On a matter as complex as this one, I could write a lengthy document.  I do not choose to belabor all the details.  Although I agree with the motives, I disagree with many of the principles involved in our federal-state relationship and have stated some of these objections.  Most of my other differences are matters of degree.  In the final analysis, I disagree with such a substantial amount of this document that I have no alternative but to dissent.


DISSENTING STATEMENT OF COMMISSIONER ROBERT E. LEE

There is no disagreement that today's action is of profound importance.  For those who support that action, the Commission has started this nation down a road leading to vastly expanded television service for the American public.  They see a future in which virtually every home in the country has a choice of 80 or more channels of television service.  All this and more, they hope, will be accomplished with little or no adverse effect on the public's existing free broadcast service.

For those who disagree with today's action, who quarrel not with the glittering promise of cable but rather the means selected today to achieve that goal, the implications of today's action are equally profound.  The otherwise vast potential for development of UHF televisions, a potential the public has created through the investment of literally millions of dollars in all-channel receivers, is sharply curtailed.  That money, which the Congress at this Commission's urging required the public to spend, has in essence been wasted.  Both the quality and the quantity of local television broadcast service will be sharply reduced in future years from what it otherwise would be.  Whether cable TV can supply services of its own (program originations) to make up for this deficiency is conjectural.  More importantly, that is a moot question insofar as those who will not have cable TV are concerned.  They include the many, perhaps millions, who cannot afford it and those living in sparsely settled areas where we have no reason to believe that non-subsidized cable will ever develop.

Much of the importance of today's action lies in the change in basic regulatory policy which it reflects.  The Commission began regulating cable TV carriage of broadcast signals in 1965 because of a concern that otherwise cable operations would lead to an impairment of broadcast service.  The Commission's jurisdiction to regulate CATV was sustained by the Supreme Court precisely because we deemed such regulation to be essential, given our responsibility for the development of broadcast service.  United States v. Southwestern Cable Co., 392 U.S. 157 (1968). Then the issue was, what is needed in the way of regulation to insure that the public does not suffer a loss in existing or potential broadcast service?

Now the issue is, what must cable be given in the way of opportunities to use broadcast signals in order to grow and prosper, and how much can be given to cable operators without unduly or unnecessarily impairing broadcast service to the public.  Framing the issue in this new fashion stems from quite dubious premises.  Despite the best of intentions and adoption of various regulatory requirements to insure that future cable systems do more than merely retransmit broadcast signals, there remains a very serious question as to whether the path taken by the majority today will lead to the goal that it wishes to reach.

It is most unfortunate that action as important as today's is marred by a serious procedural flaw: The absence of an adequate opportunity for comment from the public on the new rules.  The new rules adopted today bear little resemblance to the initial Commission proposals of December 1968 and July 1970 which initiated the proceedings from which this decision stems.  The public has never been invited to comment on these new provisions and despite a massive record of written and oral comments much of what is done today can only be described as guesswork.  We have, for example, adopted elaborate new rules on program exclusivity requirements in some markets.  While there have been references in passing to expanded program exclusivity in Commission notices and certain parties have urged this approach, the vast record is barren of any support for the requirement adopted today that special new program contracts or portions of contracts be prepared by television stations and placed in the public file, or the various requirements as to what such contracts must provide in order for the station to be entitled to exclusivity.

The Report and Order argues that in view of the "consensus agreement" developed through the Office of Telecommunications Policy (OTP) with the cooperation of Chairman Burch, further comment from the public is unnecessary: The compromise must  be taken in its entirety or rejected and on that issue the broad consensus among the industries makes it unlikely that further comment would be helpful. This is not persuasive.  Many within and without the affected industries do not accept the compromise and they should be heard.  Further, the new rules clearly do not incorporate the consensus agreement in its entirety and parties to the compromise might very well have helpful views on whether the new rules reflect their understanding of the compromise.  They too should be heard.

Questions of basic policy and procedure aside, there are a great many troublesome specifics in today's action, which are set out in more detail below. Why, for example, is it necessary or wise to permit unlimited importation of distant signals and unlimited "leapfrogging" among CATV systems located more than 35 miles from a television station and at the same time exempt these CATV systems from the very requirements -- extra channel capacity, access channels, and the rest -- which are cited as a reason for allowing greater signal importation?  Why encourage CATV systems to drop the local news and public affairs programs of distant stations, thereby discouraging those stations from originating that type of programming, when we regard it as the touchstone of local television service?  Regretfully, the Report and Order, although lengthy, merely describes these troublesome provisions of the new rules without offering any rational basis for their adoption.

The Profound Change in the Communications Policy

The majority today authorizes widespread distant signal importation not out of any belief that this in and of itself will be of benefit to the public but rather in the hope that this will stimulate cable development which in turn will result in the development of other cable services -- access channels, special non-program services and so forth -- which all of us wish to see come into being. Thus Paragraph 90 states:

The rationale for permitting at least two additional signals in all major markets is simply this: It appears that two signals not available in the community is the minimum amount of new service needed to attract large amounts of investment capital for the construction of new systems and to open the way for the development of cable's potential.

And in Paragraph 147 in explaining why the access channel and related requirements have been imposed on certain CATVs:

We focus here on the top 100 markets because we have selected these markets as the recipients of certain benefits in order to stimulate cable growth.

Those "certain benefits" are the use of distant signals in situations where distant signals will not provide the public with any new diversity of programming, and certainly will not provide any additional locally oriented service. 

Regretfully the Report and Order does not demonstrate why "certain benefits" are needed.  To be sure, we have heard again and again the claim that without distant signals cable operators are unwilling to gamble on the public's buying other cable services in sufficient quantity yesterday, and may even be true today, it by no means follows that it will always be true or will be true tomorrow.  Potential new services will be perfected; less fearful cable operators may come on the scene.  Once a few showed the way, others would undoubtedly follow. n1 Indeed, it might very well be that fostering continued cable TV reliance on distant signals as the primary basis for attracting subscribers will impede rather than enhance the development of other cable services.

The decision to sponsor cable through the authorization to carry distant signals is in its own right a profound change in communications policy.  It is also a profound change because it alters prior fundamental Commission policy.  In particular we have had since 1962 a clear mandate from the Congress to foster the development of UHF television.  The public has been required to purchase more costly receivers containing all-channel tuners.  Ironically, while we have just recently strengthened this requirement through new regulations designed to achieve parity of tuning in receivers in interstate commerce after 1974, today we adopt rules which reduce the possibility of new UHF stations coming on the air and of existing stations being able to make a go of it. 

n1 From time to time leaders in the CATV industry have urged, contrary to the underlying philosophy of today's action, that the cable industry can develop without widespread use of distant signals.  For example, an editorial in the May 1971 issue of TV Communications says:

"What if cable doesn't get distant signals?  Does this mean the industry is washed up -- that its chances of expanding into most of the nation's television homes are lost?

"I don't think so.  I think there are alternatives.

"And one alternative is for the cable industry to develop its own programming."

"We've been crying all these years for distant programming.  But what people will watch is not necessarily distant programming, but more programming and more diverse and perhaps better programming.  A CATV co-op could produce or obtain programming at least as good as the country's most successful independents.  And unlike the independents, none of it would be programming which has a local interest only in their markets.

Because I, too, am most anxious to see cable develop its promised new services, I joined in the July 1970 Second Further Notice of Proposed Rule Making and in the August 5, 1971, letter of intent in the hopes that both of these actions would elicit information which would indicate whether or not we could sponsor cable with distant signals without compromising our policy on UHF.  The Report and Order approaches this question by briefly mentioning certain expert studies on the likely impact of distant signals on local broadcast service and concluding there is no certainty that there will be an intolerable adverse impact.  With all due deference, I believe this is an erroneous approach.  Since it is cable that seeks the benefit of distant signals it should be up to cable to demonstrate in a convincing fashion that this will not lead to injury to broadcast service.  No such showing has been made.  The cable industry did not see fit to sponsor any expert study on the matter of impact on broadcast service.  The study chiefly relied upon by the Report and Order to indicate there would be little risk of injury is the Rand Study of Dr. Rolla Edward Park.  That study suggests that importation of distant signals in markets 51 to 100 would produce an average revenue loss of 23% for local stations; in markets 101 to 150, an average loss of 30%; and in markets 151 to 200, an average loss of 56%.  Overall, based on 1968 data, the same study suggests that the number of stations operating in the red would increase from 23% to 57%.  n2

n2 R. Park, "Potential Impact of Cable Growth on Television Broadcasting", October, 1970, pp. 5 and 73.The study urges that up to half of overall revenue losses due to losses in local viewing would be recaptured by the revenue benefit of increased viewer exposure as a distant signal.  But the study also notes, correctly, that this benefit would be confined to stations in the larger (e.g., top 25) markets.  Thus this point is unimportant insofar as stations outside the top 50 markets are concerned.

It is true, as the Report and Order notes, that the Rand Study assumed importation of four distant signals, while the Report and Order generally will authorize importation of only two distant signals.  But even the National Cable Television Association in its February 1971 Reply Comments argues that two or even one distant signal would produce much more than 50% or 25% respectively of the audience loss that would occur with four distant signals.  Additionally, the Rand Study assumes that a limitation of four distant signals would apply throughout the entire area of the television market.  The limitation to two distant signals in the new rules applies only within the 35-mile zones of television markets.  However, particularly where smaller television markets are concerned, a very substantial portion of the market is located beyond the 35-mile zone where unlimited number of distant signals can be imported.

Because it concludes that there is no definitive answer on the question of impact, the Report and Order can only express a hope that there will be no adverse impact and a promise to keep a watchful eye and to attempt to take remedial steps if injury does occur.

While no doubt motivated by the best of intentions, this promise of future remedial action is of very little solace to those who are concerned with the quality and quantity of free broadcast service.  Repeatedly the Commission has stated that it will not and cannot roll back cable operations once lawfully authorized and in operation.  Indeed, even in today's decision the Commission takes the extraordinary step of "grandfathering" both for purposes of the number of signals that can be carried and for purposes on an exemption from the new exclusivity requirements not only all lawfully operating CATVs but also in some cases CATVs which have taken absolutely no step toward construction or operation but have simply filed a letter with the Commission listing the signals they desire to carry pursuant to old Section 74.1105.  See Report and Order, footnote 58.  Relief after the fact of injury which stopped short of a rollback (such as a restriction on further expansion) would do nothing to relieve the injury that had already occurred.  The only other possibility is special relief before CATV importation commences.  This is technically available, but Paragraphs 91 and 112-113 as a practical matter all but preclude this remedy.

Procedural Flaw

I strongly believe that in a matter of this fundamental importance it behooves the Commission to go out of its way to insure that all parties have an adequate opportunity to be heard on all the pertinent issues and sub-issues.  Many of the matters dealt with in this Report and Order in one or two sentences or even a footnote could by themselves be the subject of a separate rule making procedure and normally would be.  For example, among many other things, the majority today significantly expands the material which must be contained in a station's public file and imposes logging requirements on certain CATV systems; both are treated as details relating to implementation of the new exclusivity rules.  Usually each of these items would be the subject of separate rule making proceedings.  Here, however, the public has had no notice of our intention to adopt these requirements, although the logging matter came up in connection with the reporting requirements not long ago in the Third Report and Order in this docket.  Are these requirements sound? Are they necessary to implement program exclusivity rules? Are there some more effective and less onerous ways of implementing those rules and assuring that parties live by them?  These are questions on which interested parties ought to be heard -- not merely out of fairness to them, but to insure that we have adopted the best possible means for insuring compliance with the rules.

It is argued that prior passing references to program exclusivity in our  Notices plus comments urging such rules are, from a strictly legal standpoint, legally adequate notice within the meaning of the Administrative Procedure Act and that in any event a decision on this matter is long overdue.  Whatever may be the legal requirements under the APA, I deeply regret that the Commission has not seen fit to exercise its sound discretion to obtain further comments.  By establishing reasonably short deadlines such as 30 days for comments and 20 days for reply comments there would only be a short additional delay that could very well pay handsome dividends by giving us an opportunity to correct mistakes that will be very difficult to correct at a later date.

The opportunity to file petitions for reconsideration does not negate the need for further comments any more than it negates the need for comments initially in any rule making proceeding.  The presumption is always against the granting of a petition for reconsideration, particularly when there is an effective date for the rules barely seven weeks away, and there are many aspects of the new rules as to which no presumption one way or the other is justifiable on the present record.  While we have heard informally since the August 5th letter from some interested parties on the various issues before us, this is not an adequate or fair opportunity for all interested persons to express their views, particularly when vital elements of the new rules have not previously been made available to the public.

The "Consensus Agreement"

The Report and Order states that adoption of the suggestions contained in the OTP compromise or consensus agreement does not justify further comment because the only issue is whether to adopt those suggestions in their entirety and on that issue, in view of the broad consensus on the compromise, further comment seems unnecessary.  With all due respect, this merely clouds the issue.  The public and substantial numbers of interested parties did not participate in the compromise and several of these elements, CBS, Corinthian Broadcasting Company, the Rocky Mountain Broadcasters Association and others, have already voiced informally and in writing objections to it.  Public broadcasters have not been heard.  The rules that purport to implement the compromise exclude ETV stations from any right to exclusivity on syndicated programs.  This surely was not required by the compromise,  which does not specifically mention ETV, and it is a point in which ETV representatives should be given a chance to express their views.

On the cable side, we have heard only from NCTA.  It reportedly represents somewhat less than half the existing CATV systems, with most non-members being operators of smaller systems.  See CATV magazine, p. 11, January 10, 1972.

On the copyright-exclusivity issues, the group of copyright owners that approved the compromise does not represent BMI, ASCAP and several others that have important interests in this area.

All of these groups and certainly disinterested members of the public should be heard.  But the only way they will all know they can be heard is for the Commission to invite comments.

Furthermore, the parties that did accept the compromise should be given an adequate opportunity to express their views both on whether or not the new rules reflect their understanding of the compromise and on the desirability of other new aspects of the rules (e.g., the procedures on program exclusivity) which have been adopted in light of the compromise.  While the Report and Order states that the compromise is being and must be adopted in its entirety,  the fact is that there is at least one clear divergence in the rules from the compromise and several other areas where the intent of the compromise has not been followed.  The compromise specifically called for a rule on CATV carriage of radio stations; instead of adopting such a rule, this is being made the subject of a separate rule making proceeding.  That may very well be the best approach, but it is also a clear divergence from the agreement.  n3 As for divergence from the intent of the compromise, as the Report and Order notes, the intent of the parties apparently was that one or two distant stations as the case may be had to be carried full time without substitution of programs from other distant stations except when the exclusivity rules created gaps in the schedule of the regularly carried distant station.  The new rules, however, deviate most substantially from this in two important respects.  Further, the new rules reflect several important changes from the August 5th letter of intent.  In some cases these are said at all.  In every case the denial of an opportunity for further comment deeply troubles me as a most unwise exercise of agency discretion.

n3 Another clear divergence which is very difficult to justify appears to be in the area of grandfathering.  The compromise calls for grandfather rights for existing systems.  The rules, as noted above, go much further by also giving grandfather status to yet unborn CATVs that technically can claim an authorization to carry certain signals not available under the new rules.

Personally, while an arms-length settlement of differences is quite appealing as a general matter, many aspects of the "consensus agreement" as detailed below are quite troublesome.  These are outlined below.  Since many parties and the public do not accept the compromise or were not invited to join in it, and since the parties that did accept it did so most reluctantly on a take-it-or-leave-it basis, the lack of an opportunity for further comment is most regrettable, unfair and perhaps in violation of the legal requirements of the Administrative Procedure Act.

Troublesome Particulars of the New Rules

The new rules are troublesome and deeply concern me in a number of particulars.  For purposes of brevity, only the most troublesome features will be described briefly.

A.  SIGNAL CARRIAGE RULES FOR THE SMALLEST TELEVISION MARKET

The new rules give short shrift to the quite persuasive showings on behalf of broadcasters in the very smallest markets, including but not limited to the Rocky Mountain area, that their service to the public is about to be seriously impaired.  We have persuasive evidence that in the smallest television markets a very large proportion, and indeed in some cases more than one half, of all local revenues are attributable to communities outside the 35-miles zones.  Yet the new rules permit completely unlimited distant signal importation in such communities.

While stations in the larger markets on the whole gain additional exclusivity rights, as compared with the prior rules, stations in the smallest markets end up with less exclusivity.  The cutback from same day non-duplication protection to simultaneous non-duplication protection is likely to hurt not only stations in the Mountain Time zone which are forced to delay network programs, but also many other stations in the smallest markets.  For a variety of reasons these stations often cannot broadcast network programs simultaneously with the network feed.

For the smallest markets the Report and Order simply (1) promises to grant special relief if compelling showings are made and (2) requires carriage and very limited non-duplication beyond the Grade B contour in a few cases.  For the reasons stated above, the opportunity to seek special relief does not appear to be promising.  This is particularly so for a station in a very small market that typically would be unable to afford the expenses associated with a costly administrative proceeding.  Requiring carriage of the non-Grade B signals of these smaller market stations where those signals are "significantly viewed," and creating a right to non-duplication as to new systems in these areas, hardly answers the problem.  In most cases where the new mandatory carriage rule would be applicable the CATV systems are probably already carrying the signal.  If they are not already carrying the signal because of reception difficulties, the Report and Order invites a cable request for waiver of the new mandatory carriage rule.  Since in many cases systems in these outlying areas will often already have been built, the new quite limited right to non-duplication will have very limited practical benefit.

A special problem relating to both the smallest and medium (51 to 100) sized markets involves CATV systems located within the zones of both a larger and a smaller market.  The new rules in every case of this type allow the CATV to follow the more permissive rule on the number of distant signals.  This deprives the smaller market station of the protection which it was to receive under the 3+1 or 3+2 rule applicable to its market.  To redress this at least partially it would seem appropriate in such cases to give the smaller market the greater exclusivity rights applicable in the larger market.  After all, why should the cable operator have it both ways?  The Report and Order, however, declines to do this, saying the problem arises very rarely.  But a quick review of the 1972 CATV Atlas indicates there are at least 10 smaller markets where this will be a serious matter because the smaller market's zone is substantially overlapped by the zone of a larger market.

Under the new rules the same number of distant signals will be imported into the New York City market, ranked number 1 and having some 5 million television homes, as will be imported into the Columbia, South Carolina market, ranked number 100 and having roughly 125,000 TV homes.  The New York City stations receive full "run-of-contract" program exclusivity for their syndicated programs.  The Columbia stations receive very limited program exclusivity.  Surely a Columbia station and every other station in the 51 to 100 group has just as compelling a case to make for exclusivity protection as a New York City station or any other station in the 1 to 50 group.

The August 5th letter singled out 12 markets for special treatment limiting the number of distant signals that otherwise would be imported.  These markets were selected either because they would have received so many overlapping signals under the viewing test or because they were markets in the 51 to 100 group that had a local UHF independent station that would be especially vulnerable to injury from imported signals.  The Report and Order rejects this element of the August 5th proposals, stating that there is no need to single out these markets for special treatment since under the consensus agreement these markets have gained additional program exclusivity rights. This is most difficult to understand since (1) the new exclusivity rights are inapplicable insofar as signals carried under the viewing test are concerned and (2) in markets 51 to 100 the new exclusivity is extremely limited and so will be of very limited benefit to the highly vulnerable UHF independents.  Moreover, we have had no indication that the compromise was in any way intended or understood by the parties accepting it to eliminate the special relief contemplated by the August 5th letter in these particular markets.

C.  SOURCE AND MANNER OF CARRYING DISTANT SIGNALS

The August 5th letter would have required that at least one of the two imported signals in markets 1 to 100 be a UHF independent.  That requirement has been omitted, presumably because of the compromise, with the result that in at least some markets it is highly probable that both of the imported signals will be VHF independents.  This means that, to the extent distant signal carriage is of benefit to the distant station, the struggling UHF stations having the greatest need for that benefit are being deprived of it.

We proposed "leapfrogging" requirements in December 1968 because of concern that cable systems would concentrate on the big city "glamour" stations in the very largest and most distant markets.  This would lessen the probability of imported programming being attuned to the local needs and interests and raise issues of concentration of control.  While the Commission has adopted a much more permissive leapfrogging requirement than was originally proposed, it has also eliminated any leapfrogging requirement for CATV systems beyond the 35-mile zones.  Thus, Los Angeles stations could be carried in Westerley, Rhode Island (some 36 miles from Providence) and every other community across the country that is also beyond the 35-mile zone and New York City stations can be carried in Provo, Utah (36 plus miles from Salt Lake), long View, Washington, and numbers of other communities.  The lack of programming attuned to local interests and the problem of concentration of control are no less serious in such communities than they are within the 35-mile zones.

Regarding the manner of distant signal carriage, the new rules permit substitution of other distant signals when, due to the program exclusivity requirements, the programs of the regularly carried distant signals have to be deleted.  Although this was contemplated by the compromise, the new rules go beyond what was contemplated in the compromise [at least as the compromise is described in paragraph 62 (iii) of the Report and Order].  Local news and local public affairs programs broadcast by the distant station may be omitted even though their deletion is not required by the exclusivity rules, and entertainment programs substituted from other distant signals.  Thus if Channel 5, Washington, is carried as a distant signal in Richmond, Channel 5's 10 o'clock news program may be deleted by the CATV system and an entertainment program from New York or even Los Angeles could be substituted.

This is most undesirable on several accounts.  It discourages Channel 5 from broadcasting local news and public affairs programs, indeed it penalizes Channel 5 for doing this, at least to the extent the station benefits from being carried as a distant signal.  It eliminates programming that may be of interest to local cable subscribers even though it is from a distant signal.  The Channel 5 news program, for example, does deal with Virginia and area affairs.  Indeed, the possibility that the nearest distant signal may have programming of interest to local subscribers is one of the very purposes of the leapfrogging rule.  Finally, the opportunity to delete local news and substitute entertainment programs may turn out to be extremely troublesome to cable system operators who may find themselves caught in the middle between subscribers who want the news and subscribers who want something else.

The rules also provide that a program f any length may be substituted and carried to completion even though it spills over into programs on a regularly carried  signal that need not nor should be deleted.  Continuing with the example above, if Channel 5 broadcasts a half-hour program which must be deleted in Richmond under the exclusivity requirements the CATV is free to bring in anything from a two-hour motion picture from New York to a three-hour sports event from Los Angeles.  Since cable systems are free to pick from any station in the country in order to find substitute programming, it would not seem unduly burdensome to require them to pick programming that conforms in running time to the programming that has to be deleted.

D.  THE OVERLAPPING SIGNAL PROBLEM

As any fair reading of the August 5th letter will indicate, the proposal for this problem was that the basic structure of the December 1968 proposals would be adopted, subject only to a modification based on the substantial viewing test principle and changes extending that structure to major market -- smaller market overlap situations.  That basic structure was that in communities within the 35-mile zones, Grade B signals from other markets would be treated as distant signals, unless the community was also within the 35-mile zones of the second market.  This basic structure had no application where non-Grade B signals were concerned. The new rules, however, incorporate several novel and troublesome features some of which embody substantial deviations from the August 5th proposals.

First, the viewing test now applies to non-Grade B signals even though these had always been regarded previously as distant signals.  Second, the countrywide viewing figures are made conclusive as to all communities within a county whenever they show that the viewing test is met (but they are not in the converse situation). Third, broadcasters, but not CATV operators, are precluded from introducing special data or surveys contradicting the American Research Bureau data relied on by the Commission.  Fourth, the procedures and criteria for special showings are spelled out in some detail.

The result of the first three of these changes is that there may very well be cases in which a signal is not significantly viewed within the meaning of the rules in a particular community and indeed does not provide a predicted signal to that community but parties wishing to demonstrate this are precluded from doing so.  Parties wishing to add signals in the converse situation, however, will be free to submit special surveys after March 31, 1973.  Paragraph 85 of the Report and Order argues that this "you-can-but-he-can't" approach is sound because otherwise broadcasters would delay CATV development by attempting special showings "in virtually every case." I believe that the Commission could find satisfactory means of dealing with such a problem, if it were to occur, short of creating an unfortunate appearance of being one-sided on this matter.  Whether or not the criteria for special surveys are meaningful is a subject which, again most regrettably, the Commission has not seen fit to solicit comments.

The compromise has led to a change in the viewing test raising the audience share figure for independent stations from 1% to 2%.  While there is support in the record for the adoption of some viewing test, there is very little if any support for the precise figures adopted.  Is 2% "substantial?" On its face it would not seem to be.  This again is an issue upon which further comment would have been most helpful.

E.  THE SYNDICATED PROGRAM EXCLUSIVITY RULES

In addition to the troublesome discrimination against medium sized stations noted above, there are several troublesome features to these rules.  Why, for example, are there elaborate requirements spelling out what the station's program contract must include on the subject of exclusive rights?  Was this what the parties intended?  And further, why must contract provisions routinely be made available for public inspection?  What evidence is there that without this requirement broadcast licensees will abuse the privilege accorded them and attempt to deceive CATV system operators on this subject?  In any event, must the notification procedures be as cumbersome as they appear to be in the rules?  Again, these are questions on which further comments might have shed light.

F.  THE ACCESS CHANNEL AND FEDERAL-STATE RELATIONSHIP RULES

As the Report and Order quite candidly points out, in this area the Commission is plowing very new ground.  There are repeated concessions that these rules may not work or will otherwise have to be changed once some experience is gained.  I share this concern.  It may turn out, for example, that these rules are too harsh on CATV, at least at this stage of its development.  The proposals set forth in December 1968 out of which these new rules derive were similarly of a very general nature.  Because this is such a new area and because it is conceded that the Commission is unsure of what it is doing, further comment certainly would have been appropriate.

Moreover, by clearly requiring substantial investment in a new business unrelated to the traditional operation of CATV, these new rules are of dubious legality in light of Midwest Video v. FCC, 441 F.2d 1322 (8th Cir. 1971), cert. granted, No. 71-506.  Earlier, operation of rules requiring program origination was suspended pending the outcome of Midwest Video in the Supreme Court.  The same procedure would certainly have been in order here.

CONCLUSION

I recommend that the Commission reconsider its decision of today and take such appropriate action to remedy the problems that I have outlined in my statement.  Such remedial action will permit all segments of the communications industry to work and prosper together as they serve the public -- rural and urban America.


OPINION OF COMMISSIONER NICHOLAS JOHNSON, CONCURRING IN PART AND DISSENTING IN PART

FOREWORD

On Thursday, February 3, 1972, I issued a preliminary opinion in this matter.  The text of that opinion follows:

The much-heralded new dawn for cable turns out to be a cold and smog-filled day.

The White House interference in the process makes a mockery of the FCC's independence and role as an arm of Congress.

The Commission's about-face accommodation of the desires of the largest broadcasters, cable companies and copyright interests -- after long hearings and the declaration of its August 5th policy as in the "public interest" -- makes a shambles of the spirit of the Administrative Procedure Act. This failing is so severe that even issuing this document as a proposed rulemaking for public comment would not cure it.

For FCC Chairman Burch to engage in secret bargaining sessions designed to bind his fellow Commissioners to policies in which they have had no participation is an affront to a multi-man Commission.

The hurried issuance of today's document means that few of the full opinions of the six Commissioners will be available, and the only people to get copies of the document for a matter of days will be a few favored Congressmen, lobbyists, trade magazines and press.  The use of the Federal Register will take a week, and may also preclude publication of separate statements.

The substance is little better than the procedure.  It is not true, as the majority states, that the compromise "does not disturb the basic structure of our August 5 plan." Unlike the August 5th rules, at least 40% of the American people, those who live in the largest cities, will now not get cable.  This serves no one's interests -- save the most powerful broadcasters and program owners who now get their way.  The multi-million-dollar big city corporate owners, whose "National Association of Broadcasters" exacted the added protectionism for them, don't need it.  Small broadcasters may -- but don't get it.  If cable is to grow, it must be in the big cities -- where it's precluded.  If the potential need and demand for leased channels, public access channels, and minority programming are to be served it must be in the big cities.  It won't be.

The limitations on what even small-town cable can carry are ridiculous.  With all its capacity to bring the American people dozens of signals from thousands of miles, the FCC rules won't even let cable systems carry some signals that its subscribers can pick up off the air with rabbit ears!  There are severe limitations on the cities from which signals can be imported.  An elaborate, almost unintelligible section (inserted by the richest program owners after the August 5th policy excluded it) prohibits the showing of the programs most desired by the public.  The FCC agrees, moreover, to tie its hands and never make future changes in part of this arrangement.

A fuller opinion will follow.

Now, two working days later, the fuller opinion promised has been prepared, and follows.

INTRODUCTION

In future years, when students of law or government wish to study the decision making process at its worst, when they look for examples of industry domination of government, when they look for Presidential interference in the operation of an agency responsible to Congress, they will look to the FCC handling of the never-ending saga of cable television as a classic case study.  It is unfortunate, if not fatal, that the decision must be described in these terms, for of the national communications policy questions before us, none is more important to the country's future than cable television.

The Commission has promulgated rules for cable television which are designed to introduce, in a conservative fashion, the benefits of cable to some of the people of this country.   To the extent they will, to some extent, achieve that purpose, I concur with the majority.  Because they are substantially different from the rules I would have preferred to adopt, and because the Commission arrived at those rules through a process I find wholly inconsistent with the spirit of the Administrative Procedure Act, the concept of independent regulatory agencies, and possibly the due process clause of the Fifth Amendment, I am compelled to dissent in part, as well.

I.  Cable Development: a Model

Unencumbered by political and vested economic pressures, cable television would develop like any new technology -- in the market place.  Systems would be built in markets in which consumer demand made building profitable.  These systems would import distant signals to the extent of market demand.  One could expect that after providing all markets with affiliates of the three national commercial networks, local independents and public broadcasting stations, perhaps two to five independent stations from various parts of the country, regional networks or some additional out of market non-commercial stations, cable systems would have little incentive to import more signals.  Indeed, a system would probably be commercially more attractive if it provided additional channels with non-broadcast ("cablecasting") services rather than additional channels of commercial television.  In any event, the market -- the cost of importing additional signals compared with the additional income they would provide the cable entrepreneur -- would seek its own level.  And, I would guess, that level would be somewhere between eight to fifteen signals, depending upon the region of the country involved.

I would impose limited regulations on this basic marketplace system.  I would require all systems in the larger cities to have a minimum capacity of 40 channels, half of which would be dedicated to other than over-the-air broadcast services.  Of the one half of the channels reserved for purposes other than over-the-air broadcast signals, at least one would be dedicated to state and local government use, one would be dedicated to educational use, one would be dedicated to the public use (all on a first come-first serve basis, free of charge), and the others would be leased to all comers at fixed rates.  Systems would be required to expand channel capacity in accordance with demand, in the manner set out in the August 5 letter and these rules.

Because a national cable network could develop under this system, some protection would have to be afforded the public as well as the systems from anti-competitive agreements between microwave systems and "overzealous" independents.  To this end microwave systems could be required to offer all independent signals along their routes to cable systems, to prevent the aggressive independent from using anticompetitive methods to achieve the network result.

The over-the-air broadcast system as we know it is an important element of our society and is entitled to some protection.  No one wants massive numbers of over-the-air stations suddenly to go bankrupt and leave the air because of cable.  Cable is currently almost wholly dependent upon over-the-air stations for its programming; there are many homeowners who can't or won't have cable; and the continued competition and choice for the viewer between cable and over-the-air signals is his only ultimate protection against cable abuses.  The question is only how much protectionism is warranted and necessary at a time when no station has yet gone off the air because of cable.  I would provide, for starters, only that no cable system could simultaneously duplicate a local station's program with that of an imported station.  Then, if a local station could demonstrate that (1) it is deteriorating substantially (i.e., a steady decline of gross revenue), and (2) that such deterioration is a result of the existence of cable television in its market, special relief could then be made available.  If the problem became widespread, new general protection could be fashioned at that time.

I would regulate to prevent further concentration of control of the mass media.  Our rules prevent cross ownership of broadcast stations and cable systems in the same market, and common ownership of national networks and cable systems.  I would also consider rules prohibiting any single company from owning more than one cable system in the top 50 markets, and any single system from reaching more than one percent of the country's television households.  I would consider prohibiting cross-ownership of newspapers and cable television in the same market.

As a matter of principle, I believe copyright holders should be compensated for the use of their products by cable systems.  But regulations implementing that right need not take the form of exclusivity (prohibiting a cable system from carrying the program at all), as they do in these rules.  Regulations could simply require the automatic payment of fees to the copyright holders, through a mechanism similar to that used by ASCAP for song writers.  However, I am not convinced that the FCC is the appropriate forum in which such decisions should be made -- any more than the FCC should attempt to legislate minimum wage legislation for cable systems, or zoning restrictions.  As I discuss more fully later in this opinion, the CBS v. Tele-Prompter suit may clarify the copyright situation beyond the Fortnightly set of facts.  Fortnightly Corporation  v. United Artists, 392 U.S. 390 (1968). In any event, I would expect either the courts or Congress to adjust the interests of the competing parties -- not the FCC -- as the Commission indicated it believed on August 5.

Finally, I would support regulations limiting subscriber charges, lease prices for leased channels, and rates charged by utilities for the use of their poles.

The model I have outlined ought to have the support of most people of independent mind -- "free entrepreneurs"   and "regulators" alike.  It serves the "public interest" and is wholly consistent with the profit motive.  The problem, of course, is that it does not have the support of the most powerful broadcasters -- a group whose political influence is unrivaled in our time.

The rules we adopt today vary from this model; in some cases they are quite similar, while in others they are based on a wholly different philosophical premise.  But a persistent current, running throughout the rules, is an absence of adequate rationale, satisfactory justifications for departures from this model.

II.  August 5, 1971 and Its Aftermath

On August 5, 1971, the Commission, in a 6 to 1 decision, transmitted to Congress a "letter of intent," outlining its proposed rules for cable television.  These rules were the result of exhaustive public hearings at which all positions were aired.  The result reached was a far cry from the free enterprise model described above; it was itself a compromise, intended to adjust and protect various economic interests, and to accommodate "political realities." But it was a compromise we agreed was feasible, and one under which cable could at least get started.

Subsequent to   our adoption of the August 5 letter, apparently not satisfied with the concessions made to each of them, broadcasters and copyright owners, with the support and encouragement of the White House and Chairman Burch (and the participation of cable interests), carved up the cable pie in a manner more to their liking.  In its rules the Commission puts its stamp of approval on the results of these closed door sessions by implementing the precise terms of the industry's agreement.

The new rules graphically demonstrate what economic protectionism can do to a sound regulatory scheme.  In our August 5 letter of intent, we recognized that the big city markets, more than the others, needed both the additional entertainment programming and the non-broadcast benefits of cable television.  Thus, while we held back cable development in the big cities in some respects (for example, only three independents' signals were permitted), we provided sufficient benefits to stimulate its beginning.  The regulatory scheme permitted cable systems in the top 50 markets to distribute, as a minimum, three network stations and three independent stations.  Systems in the second 50 markets were permitted three network   and two independent stations.  Those systems in markets below the top 100 were permitted three network affiliates and one independent station.  And systems in cities without any television stations were permitted an unlimited number of independents.  (All systems could also carry non-commercial and foreign language television stations, and radio signals.)

We never felt that cable's future was tied to distant broadcast signals; if that were all that was involved, it is doubtful that we would have spent one-tenth the effort we have expended.  With this scheme, we hoped that systems in the larger markets, where diversity of interests most required the non-broadcast advantages of cable -- such as access, leased channels for community groups, and educational channels -- would have sufficient attractiveness to subscribers so as to provide the economic base necessary for the development of these services.

Markets 51 to 100 were given fewer distant signals on the theory that the over-the-air stations there had less in the way of both revenue and audience to support much imported competition.  Systems in the smallest cities, those located more than 35 miles from any television station, were   to be permitted unlimited distant signals on the theory that, barring any rationale for station protectionism, there was no reason not to revert to the model of unlimited signal importation.

This was the state of affairs on August 5, 1971.  Thereafter, the vested economic interests -- broadcasters (who felt threatened by this new technological competitor), copyright holders (who were afraid cable systems would diminish the value of their products), and the cable industry (who felt threatened by the political power of the broadcasters -- once joined by Chairman Burch and the President -- to stop our August 5 policy entirely in Congress) -- met with the representatives of the White House and with FCC Chairman Burch and finally agreed to the compromise that the majority refers to as the "consensus agreement."

The compromise carved up the action among the three industries, at the expense of the viewing public, by making three changes in the policy we announced on August 5.  Despite the majority's assurances that its "incorporation into our new rules for cable does not disturb the basic structure of our August 5 plan," the compromise was, of course, designed to disturb the basic structure   and succeeded in doing so.

III.  Policy and Protectionism

The compromise and the rules promulgated by the Commission are a far cry from the free enterprise model of cable television.  They are a patchwork of protectionism, designed to foster the interests of vested economic institutions at the expense of the public.  Admittedly, under these rules cable will be able to make a very modest start in some of the smallest markets.  It will not, however, grow with the speed and the impact it would have under less restrictive rules.  The major failings of the compromise and the rules, as I see them, involve the exclusivity protection, the viewing standard, and leapfrogging.

Exclusivity protection.  The rules provide for "run of the contract exclusivity" to stations in the top 50 markets, and two year exclusivity to stations in markets 51-100.  That is, a program supplier can sell, and a station can buy, an "exclusive" right to a given program, and gain thereby the legally enforceable right to keep any other station in the market from showing it.  Now, says the FCC, the station can use that "exclusivity" to keep a cable system from importing that program from an out-of-market station   as well.  In other words, if a station in one of these markets has a contractual right to show David Frost or The Pawnbroker, no cable system in that market can import it from another city.  Thus, although top 100 market systems are "permitted" to import distant signals, these signals will have to be blacked out whenever they carry programs covered under exclusive contracts.  One of the principal services offered by cable -- not just different programming, but alternative schedules for the same programming -- is hereby simply wiped out.  Further, programs or films subject to local "exclusivity" may not be imported by cable even though the local station may not show them for years.

Translated into concrete examples, based on current programming and currently existing contractual arrangements, a cable system in Charlotte, North Carolina, the forty-second market, would have to black out over 16 hours a day of programming from WTCG-TV, Atlanta, Georgia, if it chose to import that station.  A system in Fort Wayne, Indiana, the eighty-second ranking market, would have to black out WGN-TV, Chicago, should it choose to import it, for over eight hours daily.  Obviously, we can expect to   find a rush to exclusive contracts in the future to permit local stations to take advantage of this FCC-sanctioned anti-competitive device.

Viewing standard.  Television signals can often be picked up off the air from 60 to 100 miles distance in proper terrain with a good antenna.  The advantage of cable is that it can bring subscribers more signals than they can get off the air.  That's because the cable system has a taller, more powerful receiving antenna than most homeowners, and because it can relay signals by microwave over long distances (the same way the networks relay their signals from New York around the country to affiliates).  Even with a little "rabbit ears" antenna, however, I can, for example, pick up Baltimore signals on my home receiver in Washington.  One would assume, therefore, that cable systems would be permitted by the FCC to provide their subscribers at least what the subscribers can already pick up off the air.  Right?  Wrong.  The rules contain a unique concept known as the "viewing standard." Cable systems in all cities with television stations are required to carry all stations licensed to cities within a 35 mile circle around them.  That's no problem;   most cable systems would want to do that anyway.

The problem comes in defining what additional signals the cable may carry as, in effect, "local signals" -- that is, signals that will not count as "distant" imported signals.  I would define that as "viewable" signals, whether technically defined as "predicted Grade B," actual Grade B, or most pragmatically, what the cable operator can, in fact, pick up with his antenna.  In my case, for example, those Baltimore signals would be considered "viewable," even though, in fact, one would generally watch the Washington signals whenever the same network program is being shown by both.  (By contrast, the same network's news may be shown at different times in Washington and Baltimore, and being able to watch both cities' signals thereby increases the number of networks' news shows that may be watched.) This is decidedly not the FCC/industry "viewing standard." Its standard is not whether the station can be watched, but whether it is, in fact, watched.  Such an inquiry is, of course, directed solely at protection of the local station's market revenues, not to the technological capabilities of cable.  The details of "share" and "net weekly   circulation" are speeled out in the majority's document and are not necessary to our discussion.  It's sufficient to note that the August 5 policy was that any station actually viewed by 1% of the local homes could be carried and that the "compromise" raises that to 2% -- and thereby cuts in about half the number of stations that may be carried.  (For example, none of those Baltimore signals I can now watch could be carried by a Washington cable system.)

Leapfrogging.  The rules provide for the importation of a limited number of distant signals.  However, although technologically capable of bringing in distant signals from anywhere in the country, if a cable system wants to bring in a signal from a city in one of the top 25 markets -- obviously, the most desirable stations -- it must reach out only to the closest two top 25 cities.  Only when forced to black out one or both of those signals can a system go nationwide for programming.  That is, it may not "leapfrog" closer stations in order to reach out for more distant (and desirable) stations.

The net result of this compromise -- exclusivity, viewing standard, and leapfrogging -- is to reverse the priorities we established in August.  The exclusivity provisions in the top 50 markets were designed to protect the copyright holders, who derive over 80% of their profits from sales to stations in the top 50 markets.  Under these provisions, virtually all attractive programming will be unavailable to cable systems during terms of contracts that theoretically can exist forever.  (The Commission promises to study the question of the length of exclusive contracts, but bare promises are a far cry from operating rules.  And even if the Commission were to someday limit contracts, say, to five years, a term of this length will in many cases make the program a highly unattractive.) This resulting lack of available programming will doom cable in the top 50 markets.  It will literally have nothing to sell.

The exclusivity provisions in markets 51 to 100 are designed to protect broadcasters.  The copyright holders don't really care about these markets, as they earn less than 20% of their revenues there.  The broadcasters, vicariously protected in the top 50 markets by the interests of the copyright holders, managed to negotiate two-year exclusivity in the remaining markets.  Thus, cable systems will not be able to show popular   programs until two years after they are available to broadcasters.  Granted, cable may still begin, but its attractiveness will be limited.

There is no exclusivity in the small markets and nonmarket areas.  These were the cities "given" to the cable industry by broadcasters and copyright holders.

The compromise agreement not only makes little sense from a sound regulatory point of view, it's not even very sensible selfish protectionism.  While, on the one hand, our August 5 plan expressly provided benefits to the big city systems by permitting them to import some signals, the compromise burdens these systems by imposing prohibitive exclusivity, viewing standard, and leapfrogging requirements.

There may be some truth to the argument that television stations in small markets can be injured economically through audience fragmentation when even one additional competitive station comes to town via cable.  But it should be clear that stations in the major markets, already competing with large numbers of other television stations and other entertainment and news outlets, are less likely to be injured by an additional station or two.  Yet it is in these major markets where the regulations   inhibit cable, and the smaller ones where cable is free to develop.  This result can only be explained in terms of the sheer political power that the history of the compromise represents.

IV.  History and Failings of the "Consensus Agreement"

It is impossible to have a full understanding of the significance of the Commission's adoption of the consensus without first fully exploring the background of both the consensus and the rules.

In 1968, we imposed what amounted to a freeze on cable television development in the major cities -- even though never denominated as such.  We adopted procedures that we said would enhance the growth of cable, can which I believed would actually work.  Under these procedures, no cable system in a top 100 market would be permitted to import distant signals unless it received retransmission consent from that station.  This never worked.

The battle lines reformed around the issue of distant signals.  Most broadcasters were perfectly happy to permit passive cable systems -- systems which only transmitted local signals. Some broadcasters and copyright holders argued that even these passive systems should be required to pay copyright fees for local programs   that showed on their systems.  The Supreme Court rejected this argument in Fortnightly Corporation v. United Artists, 392 U.S. 390 (1968).

This did not, however, necessarily settle the question of a system's authority to carry distant signals without paying copyright.  Fortnightly was read narrowly by the FCC and limited to its facts: that is, no copyright fee would be required for the showing on cable systems of local stations, but the question of distant signals remained unsettled.

The parties refused to budge.  Broadcasters and copyright holders threatened to block any cable rules that permitted the importation of distant signals until copyright legislation was adopted -- by exerting their impressive political influence in Congress, forcing Congressional hearings.  Cable owners refused to support copyright legislation until the cable rules were adopted.  The Senate Copyright Subcommittee refused to pass a copyright revision until the question of cable was settled, and it refused to enact a separate copyright law for cable.  The process ground to a halt.

Finally, the Commission, after months of thorough study, acting precisely as one would hope a quasi-legislative body should   act, promulgated its August 5 letter.  For one of the few times in my tenure as an FCC Commissioner, I was able to join with a near-unanimous majority on a major issue of communications policy.

Unfortunately, our historic example was not to be.  Three months later, the industries had used their White House leverage to fashion their own cable policy, and the consensus agreement was born.

The implications of the Commission's decision to adopt the compromise are as serious a threat to the democratic system of government as any we have witnessed in almost 200 years of our history.  While the majority goes to great lengths to describe how our accepting the compromise was really in the public interest because it facilitated the promulgation of these rules and the passage of copyright legislation, it utterly fails to take into consideration the threat to the public interest posed by setting the precedent of deferring to big business whenever it possesses the power to impede the development of a regulatory scheme (or legislation or an executive decision).  We, as a society, profess to abhor political blackmail, and struggle to insulate our decision making process from the influence of   those who would sacrifice the common good for greedy self interest.  Yet here we find a Commission, made up of public citizens appointed by a President, agreeing that this method of decision making is in the public interest.  I am not naive enough to think that this process has not been repeated hundreds of times prior to this occasion by this and other agencies: but I am shocked when, rather than try to hide the reality, we applaud it as an appropriate method of doing the people's business.

This procedure is rendered even more abhorrent when one sees it in the perspective of the industry power over regulatory agencies that already exists.  Industries have often written the legislation under which the agencies act.  They may have veto power over the Commissioners appointed.  Their knowledge of the working of the agency is enhanced by their hiring away the ablest of its employees.  (Most former FCC Commissioners are now working, in one way or another, for one of the industries they were formerly responsible for regulating.) The potential of such future employment (at much higher pay) has been characterized by Ralph Nader as "the deferred bribe." The "regulated" industry influences   the agency's appropriations, even its forms and inquiries (though OMB "industry advisory committees").  The industry has the money to contract for any study, hire any consultant, and file whatever legal briefs and other documentation may be necessary to influence the decision "on the merits." It can send representatives to walk the halls of the agency, and provide luncheons for Commissioners and employees.  It fights at every turn (generally with agency backing) any participation by public interest law firms in matters before the agency.  Now, on top of all this, what the FCC seems to be saying is that if, notwithstanding this stacked deck, the industry still loses, we will then let it win because it's so politically powerful it can get its way anyway.  The whole sordid story doesn't auger well for those who are urging the disaffected to "work for change within the system."

The value we have trampled on comes to us from at least three different sources: the Administrative Procedure Act (APA), the philosophical concept of independent Congressional agencies, and the due process clause of the fifth amendment. The APA was designed to establish an orderly procedure by which administrative   agencies can collect information necessary for them to make intelligent decisions.  It provides an opportunity for all interested parties to comment on a proposal (in this case, cable television regulation), reply comments from those who wish to dispute what others have said, and public hearings in the event the agency feels they are desirable.  After this process, the agency is free to consult or use any source it wishes.  Thus, although adoption of the consensus agreement may not be prohibited by the APA, such an action is clearly inconsistent with the spirit of an Act which attempts to set out an orderly public procedure by which decisions of this nature are made.  The FCC often issues proposed rule makings which are little more than superficial rewrites of the requests of one special interest or another. That is not the point.  In this instance we went out of our way to canvas the full range of public and industry opinion before issuing our August 5 policy.  For Chairman Burch subsequently to go into secret sessions with industry spokesmen, and accept their rewrite of the rules, and then force the industry version down the throats of his fellow Commissioners, Congress and public   alike makes an unnecessarily cruel hoax of what started out as a fairly commendable undertaking.

Perhaps more serious is the fact that one major party to the compromise (described by some as the "glue" that holds the compromise together) was the Director of the President's Office of Telecommunications Policy.  His participation, indeed the very existence of his Office, looms large as a threat to the independence of the FCC as an agency responsible only to Congress.  This alternative voice tends to turn the Commission into a partisan body, by causing it to react on political rather than sound policy grounds; further, it tends to increase the rivalry between the President and Congress, a rivalry which is healthy only when it results in constructive dialogue as opposed to destructive bickering.  And, no less serious, it legitimizes the Administration's carrot/stick approach to broadcasters, serving as it does as an ambiguous, fear-inducing institutional outlet for the President's attacks and rewards to the media.

Finally, the history of this proceeding, beginning as it did with an honest and good-faith effort to develop the best possible cable television rules, and ending with complete   and utter deference to the demands of the most powerful elements of the industry, may have left us with a legacy that cannot withstand Constitutional scrutiny.  In 1934, and again in 1935, the Supreme Court had occasion to address a markedly similar question in the context of New Deal legislation.  Under laws subsequently struck down by the Court, industry committees were given the authority to promulgate binding regulations on their entire industry.  In striking this legislation on several grounds (some of which are not applicable here, and in any event have been reversed by later Court decisions), the Supreme Court said:

But would it be seriously contended that Congress could delegate its legislative authority to trade or industrial associations or groups so as to empower them to enact the laws they deem to be wise and beneficent for the rehabilitation and expansion of their trade or industries?  Could trade or industrial associations or groups be constituted legislative bodies for that purpose because such associations or groups are familiar with the problems of their enterprises?  And, could an effort of that sort be made valid by such a preface of generalities as to permissible   aims as we find in section 1 of title I?  The answer is obvious.  Such a delegation of legislative power is unknown to our law and is utterly inconsistent with the constitutional prerogatives and duties of Congress.  Schechter Corp. v. United States, 295 U.S. 495, 537 (1934).

In a later case the Court made a similar declaration:

The power conferred upon the majority [of the industry to establish binding wage and hour laws] is, in effect, the power to regulate the affairs of an unwilling minority.  This is legislative delegation in its most obnoxious form; for it is not even delegation to an official or an official body, presumptively disinterested, but to private persons whose interests may be and often are adverse to the interests of others in the same business.  The record shows that the conditions of competition differ among the various localities...  The difference between producing coal and regulating its production is, of course, fundamental.  The former is a private activity; the later is necessarily a governmental function, since, in the very nature of things, one person may not be entrusted with the power to regulate the business of another, especially a competitor...   The delegation is so clearly arbitrary, and so clearly a denial of rights safeguarded by the due process clause of the Fifth Amendment...  Carter v. Carter Coal Co., 298 U.S. 238,311 (1935).

No one would contend that these cases are "on all fours" with the case before us.  In the NRA cases the Court was concerned with a direct, statutory delegation of decision making and regulatory power by Congress to an industry; here the "delegation" resulted from the FFC's capitulation to the sheer power of the industry, and does not involve continuing regulatory responsibility.  Further, these cases have been overruled on many other grounds, and it is difficult to say with certainty that this aspect of the cases is as vital today as it was in 1935, even though they have never been overruled on these grounds.  But the fact remains that the Supreme Court has addressed the underlying issues present here and has found the procedures wanting. 

The very existence of this compromise, and the fact that as a practical matter the Commission was obliged to either accept it in its entirety or not at all (with the necessary result of eliminating the prospects of any cable for months or years), made   the act of putting out the rules based on this compromise as a Further Notice of Proposed Rule Making for public comment an exercise in futility.  I tried to offer modest revisions of some of the compromise provisions to make them a wee bit more palatable; Chairman Burch would not budge.  It was fait accompli or nothing.

It would have been hypocrisy in the extreme to solicit comments suggesting changes we were not free to make.  The only question that we as Commissioners, had to decide, was whether we were willing to sacrifice a fundamental value of a democratic society -- the independence of government officials from the influence of big business -- in exchange for some cable television.  The majority concluded that it was in the public interest to do so.  I could not.  No amount of comment could expand our ability to resolve this fundamental jurisprudential question, and asking for public comment would have been nothing more than a cheap attempt to camouflage what, in my view, is a fatal flaw in our procedure.

V.  Conclusion: the Politics of Cable

In view of the fact that the FCC has, in effect, abandoned its role as the formulator of policy and the interpreter of law for that   of the political pundit, perhaps I am obliged to engage in a little political comment myself.

The wisdom and validity of the FCC's acceptance of industry rules in place of its own turns on one issue -- accepting the majority's interpretation.  Put most bluntly, had we held firm to the August 5 policy, could we have brought it off? The majority thinks not; I think we could have done it.

I say "accepting the majority's interpretation" because it is, itself, a questionable assumption.  The majority is saying, in effect, that a regulatory commission must consider not just the legitimate interests of all parties but also their political power.  Its responsibility, says the FCC, goes beyond simply finding and promulgating the policy most "in the public interest." It must also consider the power of any of the powers before it to use political influence with the White House or Congress to render its policy ineffective.

The contrary position, of course is that a regulatory commission should simply declare the policy as it sees it and let the chips fall where they may in terms of subsequent actions by Congress, White House, or courts.  (One might observe, for example, that the FCC has   seemingly given little consideration in recent months to the likelihood that its decisions might be overturned by the courts.)

Since the latter position seems to have few adherents, I will simply offer it without stating a personal preference, and proceed to taking on the majority on its own ground.  What were the politics of the August 5 policy?

Chairman Burch at one point declared to a House Committee that we could have a cable policy by the end of May 1971.  Hearings on Federal Communications Commission Activities (1971) before the Subcommittee on Communications and Power of the House Committee on Interstate and Foreign Commerce, 92nd Cong., 1st Sess., ser. 92-8 at 20 (1971).  (This was later changed to August 5, December 31, March 1, 1972, and finally the date selected, March 31 -- which ultimately may have to be extended for petitions for reconsideration.) That declaration prompted an immediate reaction from broadcasters, pressuring their Senators to hold up the policy one way or another.  The Senators, in turn, communicated their constitutent problems to Senator Pastore, Chairman of the Subcommittee on Communications of the Senate Commerce Committee.  Hearings on Community   Antenna Television Problems before the Subcommittee on Communications of the Senate Committee on Commerce, 92nd Cong., 1st Sess., ser. 92-12 at 1-2 (1971).  Senator Pastore, for whatever reasons, called the FCC before his Subcommittee in June 1971.

At that time Chairman Burch outlined the substance of what became the August 5 policy.  Senator Pastore indicated his desire to know the details of the policy before it was released.  Senate Hearings at 107.  Commissioner Bartley and I complained on the record that this was contributing to the delay sought by the broadcasters.  Senate Hearings at 72 and 107.  Chairman Burch's testimony seemed to Commissioner Bartley and me to be an adequate preview of the policy for Congress.  Indeed, I argued within the Commission at the time that even that testimony may have been going too far.  (My own view is that Congress established the FCC to formulate communications policy, and that, in general, it ought to leave it alone to do its job, subject to two exceptions: general "oversight" hearings to review what the agency has done after the fact, and subject matter legislative hearings that necessarily preempt the FCC's authority to act on the issue   under review.  This was neither.  This is a view which Senator Hart supported during the Hearing.  Senate Hearings at 57-58.)

Even accepting for sake of argument that the FCC is obliged to comply with every Congressman's every wish, it seemed to me that our participation in the hearing had achieved that purpose.  Chairman Burch further promised that the Committee could get an advance look at the final policy (which I also felt to be unnecessary), and that the policy would be out before Congress adjourned (August 5, which I felt to be later than necessary).  In no event do I think Senator Pastore's requests (for the hearing, and for the advance look at the policy) required that the August 5 policy be issued in anything other than final form.

And so it was that I, once again, protested the additional delay when Chairman Burch indicated to his fellow Commissioners that the August 5 policy was not going to be issued as final rule making, but as some kind of an unprecedented "letter" to the Chairmen of the Senate and House Communications Subcommittees.  In any event, at that time we were promising the policy would be finally issued by December 31, 1971.

The question is, what would   have happened had we issued that August 5 policy as final rule making sometime between August 5 and December 31?  Bear in mind that those who voted for it on August 5 felt morally obliged to stick with it, notwithstanding the fact that each of us had some misgivings about various parts of the document.  Bear in mind also that Commissioner Robert Wells, the only Commissioner not to vote for the policy, had left; Commissioner Wiley, who took his place, and Commissioner Reid, who replaced Commissioner Houser, might well have voted for the August 5 policy (based upon their votes and opinions today).

We had discussed the policy in open hearings with both sides of Congress.  We had given them the document in advance, in effect, with the August 5 letter.  No Senator of Congressman could have made any reasonable argument that he was caught unaware, or that more time was necessary to evaluate the matter.  (Indeed, Senator Pastore was on record as hoping the policy would not change: "I hope we don't end up with one resolution and then have to chase another idea, because that has happened time and time again." Senate Hearings at 37.)

Most significantly, Chairman Burch would have been going   forward with a unanimous (or, at worst, nearly unanimous) Commission -- something he clearly doesn't have for his current industry policy.  He and I, and the others, would be declaring to Congress, the industry, and the public, with a single harmonious voice, that we were in agreement on a policy that was, indeed, in the public interest.

No dissatisfied industry spokesmen could have argued to us, or to Congress, that they had not had an adequate opportunity to be heard -- fully and fairly.  Our 1971 hearings were widely known to have been among the best in the agency's history.

As for national Presidential politics, our rules make absolutely no sense at all given the current state of our economy.  The installation of cable systems in our largest cities would require capital expenditures in the millions of dollars.  Thousands of people would be put to work building the facility, laying the cable and making the connections to the subscribing homes.  In short, cable could provide a shot in the arm for our ailing economy where it is needed most -- our cities.  If our sole purpose for taking this action is to protect broadcasters and copyright holders, it would be far more beneficial   to all concerned simply to subsidize them directly, perhaps from the taxes paid by cable systems, than to deprive the people of our major cities of both the economic growth and the technological development that cable could bring.  Politics involves more than campaign contributions from the wealthy, and media exposure by broadcasters.  It also involves the ability to marshal evidence of having done something for the people.  How can the FCC's decision possibly be squared with the President's recent State of the Union message?

We also will help meet our goal of full employment in peacetime with a set of major initiatives to stimulate more imaginative use of America's great capacity for technological advance, and to direct it toward improving the quality of life for every American.

In reaching the moon, we demonstrated what miracles American technology is capable of achieving.  Now the time has come to move more deliberately toward making full use of that technology here on earth, in harnessing the wonders of science to the service of man.  118 Cong. Rec. H 146-47 (daily ed. January 20, 1972). 

The only miracle with cable technology is that it still exists at all.

No one, of course, can know what is going to happen to any policy in Washington.  One often suspects that "D.C." stands for the Delay Capital of the world.  Broadcasters and copyright owners (and possibly even some cable operators) would have attempted to stop the policy.  So what's new?They are trying to stop today's so-called "consensus" policy, too -- giving further proof to the fact that there just ain't no such thing as a consensus between all the economic interests that are involved in this policy (as distinguished from those segments of industry represented at the closed White House meetings with Chairman Burch).  What we're engaged in is predictions, game theory.  So that's why I put all the chess men on the board.  And when I look at them, and consider all the plays I've watched (and participated in) during the past 10 years in this town, what I think would have happened is that -- after a few abortive phone calls and letters from the Hill, a threatened White House "task force," and some faulty court suits -- the August 5 policy would have become the law of the land.

And that, at least, is a good deal more than the likelihood of a lived-happily-ever-after ending for the policy we're   throwing up on the table today.


APPENDIX:

APPENDIX A

Chapter 1 of Title 47 of the Code of Federal Regulations is amended as follows:

A.  PART 1 -- PRACTICE AND PROCEDURE

1.  In   1.1116, the headnote and paragraphs (a) and (c) are revised to read as follows:

   1.1116 Scheduel of fees for Cable Television and Cable Television Relay Services.

(a) Applications and petitions filed in the Cable Television and Cable Television Relay Services shall be accompanied by the fees prescribed below:

Applications in the Cable Television Relay (CAR) Service:

 

For a construction permit

$50

For a license or renewal

15

For a modification of construction permit or license

15

Applications for certificates of compliance, pursuant to   76.11

35

 

NOTE. -- If multiple applications for certificate of compliance are filed by cable television systems having a common headend and identical ownership but serving or proposing to serve more than one community, the full $35 fee will be required only for one of the communities; $10 will be required for each of the other communities.

 

Petitions for special relief, pursuant to   76.7

25

(c) Fees are not required in the following instances: (1) Petition for special relief filed pursuant to   76.7 by a noncommercial educational broadcast station.

 

B.  PART 15 -- RADIO FREQUENCY DEVICES

 

   15.4 [Amended.]

 

1.  In   15.4, paragraph (e) is deleted.

    15.161-15.165 [Deleted.]

 

2.  Subpart D of Part 15 (   15.161-15.165) is deleted.

 

C.  PART 21 -- DOMESTIC PUBLIC RADIO SERVICES (OTHER THAN MARITIME MOBILE)

 

1.  In   21.713, the headnote and text are revised to read as follows:

   21.713 Applications for authorizations involving relay of television signals to cable television systems.

An application in this service for authorization to establish new facilities or to modify existing facilities to be used to relay television signals to cable television systems shall contain a statement by the applicant that, to the best of his knowledge, each cable television system to be served has, on or before the filing date of the application, filed any necessary application for certificate of compliance, pursuant to   76.11 and 76.13 of this chapter. Such statement by the applicant shall identify the application for certificate of compliance by the name of the cable television system for which the certificate is sought, the community and area served or to be served, the date on which the application was filed, and the file number (if available).

 

D.  PART 74 -- EXPERIMENTAL, AUXILIARY, AND SPECIAL BROADCAST, AND OTHER PROGRAM DISTRIBUTIONAL SERVICES

 

       74.1001-74.1083 [Deleted.]

1.  Subpart J of Part 74 (   74.1001-74.1083) is deleted.

    74.1101-74.1131 [Deleted.]

2.  Subpart K of Part 74 (   74.1101-74.1131) is deleted.

 

E.  PART 76 -- CABLE TELEVISION SERVICE

 

Is added to read as follows:

 

PART 76 CABLE TELEVISION SERVICE

 

CONTENTS

Subpart A -- General

 

   76.1

Purpose.

   76.3

Other pertinent rules.

   76.5

Definitions.

   76.7

Special Relief.

 

Subpart B -- Applications and Certificates of Compliance

   76.11

Certificate of compliance required.

   76.13

Filing of applications.

   76.15

Public notice.

   76.17

Objections to applications; related matters.

 

Subpart C -- Federal-State/Local Regulatory Relationships

   76.31

Franchise standards.

 

Subpart D -- Carriage of Television Broadcast Signals

   76.51

Major television markets.

   76.53

Reference points.

   76.54

Significantly viewed signals; method to be followed

 

for special showings.

   76.55

Manner of carriage.

   76.57

Provisions for systems operating in communities

 

located outside of all

 

major and smaller television markets.

   76.59

Provisions for smaller television markets.

   76.61

Provisions for first fifty major television markets.

   76.63

Provisions for second fifty major television markets.

   76.65

Grandfathering provisions.

Subpart E -- [Reserved]

Subpart F -- Program Exclusivity

   76.91

Stations entitled to network program exclusivity.

   76.93

Extent of protection.

   76.95

Exceptions.

   76.97

Waiver petitions.

   76.151

Syndicated program exclusivity; extent of protection.

   76.153

Persons entitled to exclusivity.

   76.155

Notification.

   76.157

Exclusivity contracts.

   76.159

Grandfathering.

 

Subpart G -- Cablecasting

   76.201

Origination cablecasting in conjunction with carriage of

 

broadcast

 

signals.

   76.205

Origination cablecasts by candidates for public office.

   76.209

Fairness doctrine; personal attacks; political editorials.

   76.213

Lotteries.

   76.215

Obscenity.

   76.217

Advertising.

   76.221

Sponsorship identification.

   76.225

Per-program or per-channel charges for

 

reception of cablecasts.

   76.251

Minimum channel capacity; access channels.

 

Subpart H -- General Operating Requirements

   76.301

Copies of rules.

   76.305

Logging and record-keeping requirements.

 

Subpart I -- Forms and Reports

   76.401

Annual report of cable television systems.

   76.405

Cable television annual financial report.

   76.406

Computation of cable television annual fee.

 

Subpart J -- Diversification of Control

   76.501

Cross-ownership.

 

Subpart K -- Technical Standards

   76.601

Performance tests.

   76.605

Technical standards.

   76.609

Measurements.

   76.613

Interference from a cable television system.

   76.617

Responsibility for receiver-generated

 

interference.

 

SUBPART A -- GENERAL

   76.1 Purpose.

The rules and regulations set forth in this part provide for the certification of cable television systems and for their operation in conformity with standards for carriage of television broadcast signals, program exclusivity, cablecasting, access channels, and related matters.

   76.3 Other pertinent rules.

Other pertinent provisions of the Commission's rules and regulations relating to the Cable Television Service are included in the following parts of this chapter:

Part 0 -- Commission Organization.

Part 1 -- Practice and Procedure.

Part 21 -- Domestic Public Radio Services (Other Than Maritime Mobile).

Part 63 -- Extension of Lines and Discontinuance of Service by Carriers.

Part 78 -- Cable Television Relay Service.

Part 91 -- Industrial Radio Services.

   76.5 Definitions.

(a) Cable television system (or CATV system).  Any facility that, in whole or in part, receives directly, or indirectly over the air, and amplifies or otherwise modifies the signals transmitting programs broadcast by one or more television or radio stations and distributes such signals by wire or cable to subscribing members of the public who pay for such service, but such term shall not include (1) any such facility that serves fewer than 50 subscribers, or (2) any such facility that serves only the residents of one or more apartment dwellings under common ownership, control, or management, and commercial establishments located on the premises of such an apartment house. 

NOTE. -- In general, each separate and distinct community or municipal entity (including single, discrete, unincorporated areas) served by cable television facilities constitutes a separate cable television system, even if there is a single headend and identical ownership of facilities extending into several communities.  See, e.g., Telerama, Inc., 3 FCC 2d 585 (1966); Mission Cable TV, Inc., 4 FCC 2d 236 (1966).

(b) Television station; television broadcast station.  Any television broadcast station operating on a channel regularly assigned to its community by   73.606 of this chapter, and any television broadcast station licensed by a foreign government: Provided, however, That a television broadcast station licensed by a foreign government shall not be entitled to assert a claim to carriage or program exclusivity, pursuant to Subpart D or F of this part,  but may otherwise be carried if consistent with the rules.

(c) Television translator station.  A television broadcast translator station as defined in   74.701 of this chapter.

(d) Principal community contour.  The signal contour that a television station is required to place over its entire principal community by   73.685(a) of this chapter.

(e) Grade A and Grade B contours.  The field intensity contours defined in   73.683(a) of this chapter.

(f) Specified zone of a television broadcast station.  The area extending 35 air miles from the reference point in the community to which that station is licensed or authorized by the Commission.  A list of reference points is contained in   76.53.  A television broadcast station that is authorized but not operating has a specified zone that terminates eighteen (18) months after the initial grant of its construction permit.

(g) Major television market.  The specified zone of a commercial television station licensed to a community listed in   76.51, or a combination of such specified zones where more than one community is listed.

(h) Designated community in a major television market.  A community listed in   76.51.

(i) Smaller television market.  The specified zone of a commercial television station licensed toi a community that is not listed in   76.51.

(j) Substantially duplicated.  Regularly duplicated by the network programming of one or more stations in a week during the hours of 6 to 11 p.m., local time, for a total of 14 or more hours.

(k) Significantly viewed.  Viewed in other than cable television households as follows: (1) for a full or partial network station -- a share of viewing hours of at least 3 percent (total week hours), and a net weekly circulation of at least 25 percent; and (2) for an independent station -- a share of viewing hours of at least 2 percent (total week hours), and a net weekly circulation of at least 5 percent.  See   76.54.

NOTE. -- As used in this paragraph, "share of viewing hours" means the total hours that non-cable television households viewed the subject station during the week, expressed as a percentage of the total hours these households viewed all stations during the period, and "net weekly circulation" means the number of non-cable television households that viewed the station for 5 minutes or more during the entire week, expressed as a percentage of the total non-cable television households in the survey area.

(1) Full network station.  A commercial television broadcast station that generally carries in weekly prime time hours 85 percent of the hours of programming offered by one of the three major national television networks with which it has a primary affiliation (i.e., right of first refusal or first call).

(m) Partial network station.  A commercial television broadcast station that generally carries in prime time more than 10 hours of programming per week offered by the three major national television networks, but less than the amount specified in paragraph (1) above.

(n) Independent station.  A commercial television broadcast station that generally carries in prime time not more than 10 hours of programming per week offered by the three major national television networks.

(o) Network programming.  The programming supplied by a national or regional television network, commercial or noncommercial.

(p) Syndicated program.  Any program sold, licensed, distributed, or offered to television station licensees in more than one market within the United States for non-interconnected (i.e., non-network) television broadcast exhibition, but not including live presentations.

(q) Series.  A group of two or more works which are centered around, and dominated by the same individual, or which have the same, or substantially the same, cast of principal characters or a continuous theme or plot.

(r) Off-network series.  A series whose episodes have had a national network television exhibition in the United States or a regional network exhibition in the relevant market.

(s) First-run series.  A series whose episodes have had no national network television exhibition in the United States and no regional network exhibition in the relevant market.

(t) First-run, non-series programs.  Programs, other than series, that have had no national network television exhibition in the United States and no regional network exhibition in the relevant market.

(u) Prime time.  The five-hour period from 6 to 11 p.m., local time, except that in the Central Time Zone the relevant period shall be between the hours of 5 and 10 p.m., and in the Mountain Time Zone each station shall elect whether the period shall be 6 to 11 p.m. or 5 to 10 p.m.

NOTE. -- Unless the Commission is notified to the contrary, a station in the Mountain Time Zone  shall be presumed to have elected the 6 to 11 p.m. period.

(v) Cablecasting.  Programming (exclusive of broadcast signals) carried on a cable television system.  See paragraphs (aa), (bb), and (cc) (Class II, III and IV cable television channels) of this section.

(w) Origination cablecasting.  Programming (exclusive of broadcast signals) carried on a cable television system over one or more channels and subject to the exclusive control of the cable operator.

(x) Access cablecasting.  Services provided by a cable television system on its public, educational, local government, or leased channels.

(y) Legally qualified candidate.  Any person who has publicly announced that he is a candidate for nomination by a convention of a political party or for nomination or election in a primary, special, or general election, municipal, county, State, or National, and who meets the qualifications prescribed by the applicable laws to hold the office for which he is a candidate, so that he may be voted for by the electorate directly or by means of delegates or electors, and who:

(1) Has qualified for a place on the ballot, or

(2) Is eligible under the applicable law to be voted for by sticker,  by writing his name on the ballot, or other method, and (i) has been duly nominated by a political party which is commonly known and regarded as such, or (ii) makes a substantial showing that he is a bona fide candidate for nomination or office.

(z) Class I cable television channel.  A signaling path provided by a cable television system to relay to subscriber terminals television broadcast programs that are received off-the-air or are obtained by microwave or by direct connection to a television broadcast station.

(aa) Class II cable television channel.  A signaling path provided by a cable television system to deliver to subscriber terminals television signals that are intended for reception by a television broadcast receiver without the use of an auxiliary decoding device and which signals are not involved in a broadcast transmission path.

(bb) Class III cable television channel.  A signaling path provided by a cable television system to deliver to subscriber terminals signals that are intended for reception by equipment other than a television broadcast receiver or by a television broadcast receiver only when used with auxiliary decoding equipment.

(cc) Class IV cable television channel.  A signaling path provided by a cable television system to transmit signals of any type from a subscriber terminal to another point in the cable television system.

(dd) Channel frequency response.  The relationship within a cable television channel between amplitude and frequency of a constant-amplitude input signal as measured at a subscriber terminal.

(ee) Subscriber terminal.  The cable television system terminal to which a subscriber's equipment is connected.  Separate terminals may be provided for delivery of signals of various classes.

(ff) System noise.  That combination of undesired and fluctuating disturbances within a cable television channel that degrades the transmission of the desired signal and that is due to modulation processes or thermal or other noiseproducing effects, but does not include hum and other undesired signals of discrete frequency.System noise is specified in terms of its rms voltage or its mean power level as measured in the 4 MHz bandwidth between 1.25 and 5.25 MHz above the lower channel boundary of a cable television channel.

(gg) Terminal isolation.  The attenuation, at any subscriber terminal, between that terminal and any other subscriber terminal in the cable television system.

(hh) Visual signal level.  The rms voltage produced by the visual signal during the transmission of synchronizing pulses.

   76.7 Special relief.

(a) Upon petition by a cable television system, an applicant, permittee, or licensee of a television broadcast, translator, or microwave relay station, or by any other interested person, the Commission may waive any provision of the rules relating to cable television systems, impose additional or different requirements, or issue a ruling on a complaint or disputed question.

(b) The petition may be submitted informally, by letter, but shall be accompanied by an affidavit of service on any cable television system, station licensee, permittee, applicant, or other interested person who may be directly affected if the relief requested in the petition should be granted.

(c) (1) The petition shall state the relief requested and may contain alternative requests.  It shall state fully and precisely all pertinent facts and considerations relied on the demonstrate the need for the relief requested and to support a determination that a grant of such relief would serve the public interest.  Factual allegations shall be supported by affidavit of a person or persons with actual knowledge of the facts, and exhibits shall be verified by the person who prepares them.

(2) A petition for a ruling on a complaint or disputed question shall set forth all steps taken by the parties to resolve the problem, except where the only relief sought is a clarification or interpretation of the rules.

(d) Interested persons may submit comments or opposition to the petition within thirty (30) days after it has been filed.  For good cause shown in the petition, the Commission may, by letter or telegram to known interested persons, specify a shorter time for such submissions.  Comments or oppositions shall be served on petitioner and on all persons listed in petitioner's affidavit of service, and shall contain a detailed full showing, supported by affidavit, of any facts or considerations relied on.

(e) The petitioner may file a reply to the comments or oppositions within twenty (20) days after their submission, which shall be served on all persons who have filed pleadings and shall also contain a detailed full showing, supported by affidavit, of any additional facts or considerations relied on.  For good cause shown, the Commission may specify a shorter time for the filing of reply comments.

(f) The Commission, after consideration of the pleadings, may determine whether the public interest would be served by the grant, in whole or in part, or denial of the request, or may issue a ruling on the complaint or dispute. The Commission may specify other procedures, such as oral argument, evidentiary hearing, or further written submissions directed to particular aspects, as it deems appropriate. In the event that an evidentiary hearing is required, the Commission will determine, on the basis of the pleadings and such other procedures as it may specify, whether temporary relief should be afforded any party pending the hearing and the nature of any such temporary relief.

(g) Where a petition for waiver of the provisions of   76.57(a), 76.59(a), 76.61(a), or 76.63(a), is filed within fifteen (15) days after a request for carriage, a cable television system need not carry the signal of the requesting station pending the Commission's ruling on the petition or on the question of temporary relief pending further proceedings.

SUBPART B -- APPLICATIONS AND CERTIFICATES OF COMPLIANCE

   76.11 Certificate of compliance required.

(a) No cable television system shall commence operations or add a television broadcast signal to existing operations unless it receives a certificate of compliance from the Commission.

(b) No cable television system lawfully carrying television broadcast signals in a community prior to March 31, 1972, shall continue carriage of such signals beyond the end of its current franchise period, or March 31, 1977, whichever occurs first, unless it receives a certificate of compliance.

(c) A cable television system to which paragraph (b) applies may continue to carry television broadcast signals after expiration of the period specified therein, if an application for certificate is filed at least thirty (30) days prior to the date on which a certificate would otherwise be required and the Commission has not acted on the application.

   76.13 Filing of applications.

No standard form is prescribed in connection with the filing of an application for a certificate of compliance; however, three (3) copies of the following information must be provided:

(a) For a cable television system not operational prior to March 31, 1972 (other than systems that were authorized to carry one or more television signals prior to March 31, 1972, but did not commence such carriage prior to that date), an application for certificate of compliance shall include:

(1) The name and mailing address of the operator of the proposed system, community and area to be served, television signals to be carried (other than those permitted to be carried pursuant to   76.61(b)(2)(ii) or   76.63(a) (as it related to   76.61(b)(2)(ii)), proposed date on which cable operations will commence, and, if applicable, a statement that microwave radio facilities are to be used to relay one or more signals;

(2) A copy of FCC Form 325 "Annual Report of Cable Television Systems," supplying all applicable information;

(3) A copy of the franchise, license, permit, or certificate granted to construct and operate a cable television system;

(4) A statement that explains how the proposed system's franchise and its plans for availability and administration of access channels and other nonbroadcast cable services are consistent with the provisions of   76.31 and 76.251;

(5) A statement that explains, in terms of the provisions of Subpart D of this part, how  carriage of the proposed television signals is consistent with those provisions, including any special showings as to whether a signal is significantly viewed (see   76.54(b));

(6) An affidavit of service of the information described in (a)(1) above on the licensee or permittee of any television broadcast station within whose predicted Grade B contour or 35-mile zone the system will operate, the licensee or permittee of any 100-watt or higher power television translator station licensed to the community of the system, the franchising authority, the superintendent of schools in the community of the system, and any local or state educations television authorities;

(7) A statement that the filing fee prescribed in   1.1116 is attached.

(b) For a cable television system that was authorized to carry one or more television signals prior to March 31, 1972, but did not commence such carriage prior to that date, an application for certificate of compliance shall include:

(1) The name and mailing address of the system, community and area served or to be served, television signals authorized to be carried but not carried prior to March 31, 1972, and, if applicable, a statement that microwave relay facilities are to be used to relay one or more signals;

(2) A list of all television signals already being carried;

(3) A statement that explains how the system's plans for availability and administration of access channels and other nonbroadcast cable services are consistent with the provisions of   76.251.

NOTE. -- The provisions of this subparagraph are applicable only to systems located in a community that is wholly or partially within a major television market.

(4) An affidavit of service of the information described in (b)(1) above on the parties named in paragraph (a)(6) of this section;

(5) A statement that the filing fee prescribed in   1.1116 is attached.

(c) For a cable television system proposing to add a television signal to existing oiperations, an application for certificate of compliance shall include:

(1) The name and mailing address of the system, community and area served, television signals to be added (other than those permitted to be carried pursuant to   76.61(b)(2)(ii) or   76.63(a) (as it relates to   76.61(b)(2)(ii), and, if applicable, a statement that microwave relay facilities are to be used to relay one or more signals;

(2) A list of  all television signals already being carried;

(3) A statement that explains, in terms of the provisions of Subpart D of this part, how carriage of the proposed television signals is consistent with those provisions, including any special showings on the question whether a signal is significantly viewed (see   76.54(b));

(4) A statement that explains how the system's plans for availability and administration of access channels and other nonbroadcast cable services are consistent with the provisions of   76.251;

NOTE. -- The provisions of this subparagraph are applicable only to systems operating in a community located in whole or in part within a major television market.

(5) An affidavit of service of the information described in (c)(1) above on the parties named in paragraph (a)(6) of this section;

(6) A statement that the filing fee prescribed in   1.1116 is attached.

(d) For a cable television system seeking certification of existing operations in accordance with   76.11(b), an application for certificate of compliance shall include:

(1) The name and mailing address of the system, community and area served, television signals being carried (other than those permitted to  be carried pursuant to   76.61(b)(2)(ii) or   76.63(a) (as it relates to   76.61(b)(2)(ii)), date on which operations commenced, and date on which its current franchise expires;

(2) A statement that explains how the franchise under which the system will operate upon Commission certification is consistent with the franchise standards specified in   76.31;

(3) An affidavit of service of the information described in (d)(1) above on the parties named in paragraph (a)(6) of this section;

(4) A statement that the filing fee prescribed by   1.1116 is attached.

NOTE. -- As used in   76.13, the term "predicted Grade B contour" means the field intensity contour defined in   73.683(a) of this chapter, the location of which is determined exclusively by means of the calculations prescribed in   73.684 of this chapter.

   76.15 Public Notice.

The Commission will give public notice of the filing of applications for certificates of compliance.  A certificate will not be issued sooner than thirty (30) days from the date of public notice.

   76.17 Objections to applications; related matters.

A petition challenging the service proposed in an application for certificate of compliance shall be filed within thirty (30) days of the public notice described in   76.15.  The procedures specified in   76.7 shall be applicable to such petitions and to oppositions and replies.  Controversies concerning carriage (Subpart D) and program exclusivity (   76.91) will be acted on in connection with the certificating process if raised within thirty (30) days of the public notice; any other objection will be treated as a petition for special relief filed pursuant to   76.7.

SUBPART C -- FEDERAL-STATE/LOCAL REGULATORY RELATIONSHIPS

   76.31 Franchise standards.

(a) In order to obtain a certificate of compliance, a proposed or existing cable television system shall have a franchise or other appropriate authorization that contains recitations and provisions consistent with the following requirements:

(1) The franchisee's legal, character, financial, technical, and other qualifications, and the adequacy and feasibility of its construction arrangements, have been approved by the franchising authority as part of a full public proceeding affording due process;

(2) The franchisee shall accomplish significant construction within one (1) year after receiving Commission certification, and shall thereafter equitably and reasonably extend exnergized trunk cable to a substantial percentage of its franchise area each year, such percentage to be determined by the franchising authority;

(3) The initial franchise period and any renewal franchise period shall be of reasonable duration;

(4) The franchising authority has specified or approved the initial rates which the franchisee charges subscribers for installation of equipment and regular subscriber services.  No changes in rates charged to subscribers shall be made except as authorized by the franchising authority after an appropriate public proceeding affording due process;

(5) The franchise shall specify procedures for the investigation and resolution of all complaints regarding the quality of service, equipment malfunctions, and similar matters, and shall require that the franchisee maintain a local business office or agent for these purposes;

(6) Any modifications of the provisions of this section resulting from amendment by the Commission shall be incorporated into the franchise within one (1) year of adoption of the modification, or at the time of franchise renewal, whichever occurs first. Provided, however, That,  in an application for certificate of compliance, consistency with these requirements shall not be expected of a cable television system that was in operation prior to March 31, 1972, until the end of its current franchise period, or March 31, 1977, whichever occurs first.

(b) The franchise fee shall be reasonable (e.g., in the range of 3-5 percent of the franchisee's gross subscriber revenues per year from cable television operations in the community (including all forms of consideration, such as initial lump sum payments)).  If the franchise fee exceeds three percent of such revenues, the cable television system shall not receive Commission certification until the reasonableness of the fee is approved by the Commission on showings, by the franchisee, that it will not interfere with the effectuation of federal regulatory goals in the field of cable television, and, by the franchising authority, that it is appropriate in light of the planned local regulatory program.  The provisions of this paragraph shall not be effective with respect to a cable television system that was in operation prior to March 31, 1972 until the end of its current franchise period, or March 31, 1977, whichever occurs first.

SUBPART D -- CARRIAGE OF TELEVISION BROADCAST SIGNALS

   76.51 Major television markets.

For purposes of the cable television rules, the following is a list of the major television markets and their designated communities:

(a) First fifty major television markets:

(1) New York, N.Y.-Linden-Paterson, N.J.

(2) Los Angeles-San Bernardino-Corona-Fontana, Cal.

(3) Chicago, Ill.

(4) Philadelphia, Pa.-Burlington, N.J.

(5) Detroit, Mich.

(6) Boston-Cambridge-Worcester, Mass.

(7) San Francisco-Oakland-San Jose, Cal.

(8) Cleveland-Lorain-Akron, Ohio

(9) Washingtn, D.C.

(10) Pittsburgh, Pa.

(11) St. Louis, Mo.

(12) Dallas-Fort Worth, Tex.

(13) Minneapolis-St. Paul, Minn.

(14) Baltimore, Md.

(15) Houston, Tex.

(16) Indianapolis-Bloomington, Ind.

(17) Cincinnati, Ohio-Newport, Ky.

(18) Atlanta, Ga.

(19) Hartford-New Haven-New Britain-Waterbury, Conn.

(20) Seattle-Tacoma, Wash.

(21) Miami, Fla.

(22) Kansas City, Mo.

(23) Milwaukee, Wis.

(24) Buffalo, N.Y.

(25) Sacramento-Stockton-Modesto, Cal.

(26) Memphis, Tenn.

(27) Columbus, Ohio

(28) Tampa-St. Petersburg, Fla.

(29) Portland, Ore.

(30) Nashville, Tenn.

(31) New Orleans, La.

(32) Denver, Colo.

(33) Providence, R.I.-New Bedford, Mass.

(34) Albany-Schenectady-Troy, N.Y.

(35) Syracuse, N.Y.

(36) Charleston-Huntington, W. Va.

(37) Kalamazoo-Grand Rapids-Muskegon-Battle Creek, Mich.

(38) Louisville, Ky.

(39) Oklahoma City, Oklahoma

(40) Birmingham, Ala.

(41) Dayton-Kettering, Ohio

(42) Charlotte, N.C.

(43) Phoenix-Mesa, Ariz.

(44) Norfolk-Newport News-Portsmouth-Hampton, Va.

(45) San Antonio, Tex.

(46) Greenville-Spartanburg-Anderson, S.C.-Asheville, N.C.

(47) Greensboro-High Point-Winston-Salem, N.C.

(48) Salt Lake City, Utah

(49) Wilkes Barre-Scranton, Pa.

(50) Little Rock, Ark.

(b) Second fifty major television markets:

(51) San Diego, Cal.

(52) Toledo, Ohio

(53) Omaha, Neb.

(54) Tulsa, Okla.

(55) Orlando-Daytona Beach, Fla.

(56) Rochester, N.Y.

(57) Harrisburg-Lebanon-Lancaster-York, Pa.

(58) Texarkana, Tex.-Shreveport, La.

(59) Mobile, Ala.-Pensacola, Fla.

(60) Davenport, Iowa-Rock Island-Moline, Ill.

(61) Flint-Bay City-Saginaw, Mich.

(62) Green Bay, Wis.

(63) Richmond-Petersburg, Va.

(64) Springfield-Decatur-Champaign-Jacksonville, Ill.

(65) Cedar Rapids-Waterloo, Iowa

(66) Des Moines-Ames,  Iowa

(67) Wichita-Hutchinson, Kan.

(68) Jacksonville, Fla.

(69) Cape Girardeau, Mo-Paducah, Ky.-Harrisburg, Ill.

(70) Roanoke-Lynchburg, Va.

(71) Knoxville, Tenn.

(72) Fresno, Cal.

(73) Raleigh-Durham, N.C.

(74) Johnstown-Altoona, Pa.

(75) Portland-Poland Spring, Me.

(76) Spokane, Wash.

(77) Jackson, Miss.

(78) Chattanooga, Tenn.

(79) Youngstown, Ohio

(80) South Bend-Elkhart, Ind.

(81) Albuquerque, N. Mex.

(82) Fort Wayne-Roanoke, Ind.

(83) Peoria, Ill.

(84) Greenville-Washington-New Bern, N.C.

(85) Sioux Falls-Mitchell, S.D.

(86) Evansville, Ind.

(87) Baton Rouge, La.

(88) Beaumont-Port Arthur, Texas

(89) Duluth-Superior, Minn.

(90) Wheeling, W. Va.-Steubenville, Ohio

(91) Lincoln-Hastings-Kearney, Neb.

(92) Lansing-Onondaga, Mich.

(93) Madison, Wis.

(94) Columbus, Ga.

(95) Amarillo, Tex.

(96) Huntsville-Decatur, Ala.

(97) Rockford-Freeport, Ill.

(98) Fargo-Grand Forks-Valley City, N.D.

(99) Monroe, La.-El Dorado, Ark.

(100) Columbia, S.C.

   76.53 Reference points.

To determine the boundaries of the major and smaller television markets (defined in   76.5), the following list of reference points for communities having licensed television broadcast stations and/or outstanding construction permits shall be used.  Where a community's reference point is not given, the geographic coordinates of the main post office in the community shall be used. 

 

Latitude

Longitude

State and

 

community

Degrees

Minutes

Seconds

Degrees

Minutes

Seconds

Alabama:

 

Anniston

33

39

49

87

49

47

Birmingham

33

31

01

86

48

36

Decatur

34

36

35

86

58

45

Demopolis

32

30

56

87

50

07

Dothan

31

13

27

85

23

35

Dozier

31

29

30

86

21

59

Florence

34

48

05

87

40

31

Huntsville

34

44

18

86

35

19

Louisville

31

47

00

85

33

09

Mobile

30

41

36

88

02

33

Montgomery

32

22

33

86

18

31

Mount Cheaha State Park

32

29

06

85

48

30

Selma

24

24

26

87

01

15

Tuscaloosa

33

12

05

87

33

44

Alaska:

 

Anchorage

61

13

09

149

53

29

College

64

51

22

147

48

38

Fairbanks

64

50

35

147

41

31

Juneau

58

18

06

134

25

09

Sitka

57

02

58

135

20

12

Arizona:

 

flagstaff

35

11

54

111

39

02

Mesa

33

24

54

111

49

41

Nogales

31

20

14

110

56

12

Phoenix

33

27

12

112

04

28

Tucson

32

13

15

110

58

08

Yuma

32

43

16

114

37

01

Arkansas:

 

El Dorado

33

12

39

92

39

40

Fayetteville

36

03

41

94

09

38

Fort Smith

35

23

10

94

25

36

Joesboro

35

50

14

90

42

11

Little Rock

34

44

42

92

16

37

California:

 

Bakersfield

35

22

31

119

01

16

Chico

39

44

07

121

49

57

Concord

37

58

46

122

01

51

Corona

33

52

35

117

33

56

El Centro

32

47

25

115

32

45

Eureka

40

48

08

124

09

46

Fontana

34

05

45

117

26

29

Fresno

36

44

12

119

47

11

Guasti

34

03

48

117

35

10

Hanford

36

19

51

119

38

48

Los Angeles

34

03

15

118

14

28

Modesto

37

38

26

120

59

44

Monterey

36

35

44

121

53

39

Oakland

37

48

03

122

15

54

Palm Springs

33

49

22

116

32

46

Redding

40

34

57

122

23

34

Sacramento

38

34

57

121

29

41

Salinas

36

40

24

121

39

25

San Bernadino

34

06

30

117

17

28

San Diego

32

42

53

117

09

21

San Francisco

37

46

39

122

24

40

San Jose

37

20

16

121

53

24

San Luis Obispo

35

16

49

120

39

34

San Mateo

37

34

08

122

19

16

Santa Barbara

34

25

18

119

41

55

Santa Maria

34

57

02

120

26

10

Stockton

37

57

30

121

17

16

Tulare

36

12

31

119

20

35

Ventura

34

16

47

119

17

22

Visalia

36

19

46

119

17

30

Colorado:

 

Colorado Springs

38

50

07

104

49

16

Denver

39

44

58

104

59

22

Durango

37

16

29

107

52

25

Grand Junction

39

04

06

108

33

54

Montrose

38

28

44

107

52

31

Pueblo

38

16

17

104

36

33

Sterling

40

37

29

103

12

25

Connecticut:

 

Bridgeport

41

10

49

73

11

22

Hartford

41

46

12

72

40

49

New Britain

41

40

02

72

47

08

New Haven

41

18

25

72

55

30

Norwich

41

31

36

72

04

31

Waterbury

41

33

13

73

02

31

Delaware: Wilmington

30

44

46

75

32

51

District of Columbia: Washington

38

53

51

77

00

33

Florida:

 

Clearwater

27

57

56

82

47

51

Daytona Beach

29

12

44

81

01

10

Fort Lauderdale

26

07

11

80

08

34

Fort Myers

26

38

42

81

52

06

Fort Pierce

27

26

48

80

19

38

Gainesville

29

38

56

82

19

19

Jacksonville

30

19

44

81

39

42

Largo

27

54

54

82

47

32

Leesburg

28

48

43

81

52

30

Melbourne

28

04

41

80

36

29

Miami

25

46

37

80

11

32

Ocala

29

11

34

82

08

14

Orlando

28

32

42

81

22

38

Panama City

30

09

24

85

39

46

Pensacola

30

24

51

87

12

56

St. Petersburg

27

46

18

82

38

19

Sarasota

27

20

05

82

32

20

Tallahassee

30

26

30

84

16

56

Tampa

27

56

58

82

27

25

West Palm Beach

26

42

36

80

03

07

Georgia:

 

Albany

31

34

36

84

09

22

Athens

33

57

34

83

22

39

Atlanta

33

45

10

84

23

37

Augusta

33

28

20

81

58

00

Chatsworth

34

46

08

84

46

10

Cochran

32

23

18

83

21

18

Columbus

32

28

07

84

59

24

Dawson

31

46

33

84

26

20

Macon

32

50

12

83

37

36

Pelham

31

07

42

84

09

02

Savannah

32

04

42

81

05

37

Thomasville

30

50

25

83

58

59

Waycross

31

12

19

82

21

47

Wrens

33

12

21

82

23

23

Guam: Agana

13

28

23

144

45

00

Hawaii:

 

Hilo

19

43

42

155

05

30

Honolulu

21

18

36

157

51

48

Wailuku

20

53

21

156

30

27

Idaho:

 

Boise

43

37

07

116

11

58

Idaho Falls

43

29

39

112

02

28

Lewiston

46

25

05

117

01

10

Moscow

46

43

58

116

59

54

Pocatello

42

51

38

112

27

01

Twin Falls

42

33

25

114

28

21

Illinois:

 

Aurora

41

45

22

88

18

56

Bloomington

40

28

58

88

59

32

Carbondale

37

43

38

89

13

00

Champaign

40

07

05

88

14

48

Chicago

41

52

28

87

38

22

Decatur

39

50

37

88

57

11

Elgin

42

02

14

88

16

53

Freeport

42

17

57

89

37

07

Harrisburg

37

44

20

88

32

25

Jacksonville

39

44

03

90

13

44

Joliet

41

31

37

88

04

52

La Salle

41

19

49

89

05

44

Moline

41

30

31

90

30

49

Mount Vernon

38

18

29

88

54

26

Olney

38

43

47

88

05

00

Peoria

40

41

42

89

35

33

Quincy

39

55

59

91

24

12

Rockford

42

16

07

89

05

48

Rock Island

41

30

40

90

34

24

Springfield

39

47

58

89

38

51

Urbana

40

06

41

88

13

13

Indiana:

 

Bloomington

39

09

56

86

31

52

Elkhart

41

40

56

85

58

15

Evansville

37

58

20

87

34

21

Fort Wayne

41

04

21

85

08

26

Gary

41

35

59

87

20

07

Hammond

41

35

35

13

87

27

43

 

Indiana -- Continued

 

Indianapolis

39

46

07

86

09

46

Lafayette

40

25

11

86

53

39

Marion

40

33

17

85

39

49

Muncie

40

11

28

85

23

16

Richmond

39

49

49

86

53

26

Roanoke

40

57

50

85

22

30

St. John

41

27

00

87

28

13

South Bend

41

40

33

86

15

01

Terre Haute

39

28

03

87

24

26

Vincennes

38

40

52

87

31

12

Iowa:

 

Ames

42

01

36

93

36

44

Cedar Rapids

41

58

48

91

39

48

Davenport

41

31

24

90

34

21

des Moines

41

35

14

93

37

00

Dubuque

42

29

55

90

40

08

Fort Dodge

42

30

12

94

11

05

Iowa City

41

39

37

91

31

52

Mason City

43

09

15

93

12

00

Sioux City

42

29

46

96

24

30

Waterloo

42

29

40

92

20

20

Kansas:

 

Ensign

37

38

48

100

14

00

Garden City

37

57

54

100

52

20

Goodland

39

20

53

101

42

35

Great Bend

38

22

04

98

45

58

Hays

38

52

16

99

19

57

Hutchinson

38

03

11

97

55

20

Pittsburg

37

24

50

97

42

11

Salina

38

50

36

97

36

46

Topeka

39

03

16

95

40

23

Wichita

37

41

30

97

20

16

Kentucky:

 

Ashland

38

28

36

82

38

23

Bowling Green

36

59

41

86

26

33

Covington

39

05

00

84

30

29

Elizabethatown

38

41

38

85

51

35

Hazard

37

14

54

87

11

31

Lexington

38

02

50

84

29

46

Louisiville

38

14

47

85

45

49

Madisonville

37

19

45

87

29

54

Morehead

38

10

53

83

26

08

Murray

36

36

35

88

18

39

Newport

39

05

28

84

29

20

Owensboro

37

46

27

87

06

46

Owneton

38

32

11

84

50

16

Paducah

37

05

13

88

35

56

Pikesville

37

28

49

82

31

09

Somerset

37

05

35

84

36

17

Louisiana:

 

Alexandria

31

18

33

92

26

47

Baton Rouge

30

26

58

91

11

00

Houma

29

35

34

90

43

09

Lafayette

30

13

24

92

01

06

Lake Charles

30

13

45

93

12

52

Monroe

32

30

02

92

06

55

New Orleans

29

56

53

90

04

10

Shreveport

32

30

46

93

44

58

West Monroe

32

30

51

92

08

13

Maine:

 

Augusta

44

18

53

69

46

29

Bangor

44

48

13

68

46

18

Calais

45

11

04

67

16

43

Orono

44

53

15

68

40

12

Poland Spring

44

01

42

70

21

40

Portland

43

39

33

70

15

19

Presque Isle

46

40

57

68

00

52

Maryland:

 

Baltimore

39

17

26

76

36

45

Cumberland

39

39

01

78

45

45

Hagerstown

39

38

39

77

43

15

Salisbury

38

21

56

75

35

56

Massachusetts:

 

Adams

42

37

30

73

07

05

Boston

42

21

24

71

03

25

Cambridge

42

21

58

71

06

24

Greenfield

42

35

15

72

35

54

New Bedford

41

38

13

70

55

41

Springfield

42

06

21

72

35

32

Worcester

42

15

37

71

48

17

Michigan:

 

Allen Park

42

15

12

83

12

57

Battle Creek

42

18

58

85

10

48

Bay City

43

36

04

83

53

15

Cadillac

44

15

10

85

23

52

Cheboygan

45

38

38

84

28

38

Detroit

42

19

48

83

02

57

Escanaba

45

44

45

87

03

18

Flint

43

00

50

83

41

33

Grand Rapids

42

58

03

85

40

13

Jackson

42

14

43

84

24

22

Kalamazoo

42

17

29

85

35

14

Lansing

42

44

01

84

33

15

Marquette

46

32

37

87

23

43

Mount Pleasant

43

16

12

84

46

31

Muskegon

43

14

17

86

15

02

Onondaga

42

26

41

84

33

43

Saginaw

43

25

52

83

56

05

Sault Ste. Marie

46

29

58

84

20

37

Traverse City

44

45

47

85

37

25

University Center

43

33

31

83

59

09

Minnesota:

 

Alexandria

45

53

06

95

22

39

Appleton

45

12

00

96

01

02

Austin

43

39

57

92

58

20

Duluth

46

46

56

92

06

24

Hibbing

47

25

43

92

56

21

Mankato

44

09

49

94

00

09

Minneapolis

44

58

57

93

15

43

Rochester

44

01

21

92

28

03

St. Cloud

45

33

35

94

09

38

St. Paul

44

56

50

93

05

11

Walker

47

05

57

94

35

12

Mississippi:

 

Biloxi

30

23

43

88

53

08

Bude

31

27

46

90

50

34

Columbus

33

29

40

88

25

33

Greenwood

33

31

05

90

10

55

Gulfport

30

22

04

89

05

36

Jackson

32

17

56

90

11

06

Laurel

31

41

40

89

07

48

Meridian

32

21

57

88

42

02

Oxford

34

22

00

89

31

07

State College

33

27

18

88

47

13

Tupelo

34

15

26

88

42

30

Missouri:

 

Cape Girardeau

37

18

29

89

31

29

Columbia

38

57

03

92

19

46

Hannibal

39

42

24

91

22

45

Jefferson City

38

34

40

92

10

24

Joplin

37

05

26

94

30

50

Kansas City

39

04

56

94

35

20

Kirksville

40

11

37

92

34

58

Poplar Bluff

36

45

20

90

23

38

St. Joseph

39

45

57

94

51

02

St. Joseph

39

45

57

94

51

02

St. Louis

38

37

45

90

12

22

Sedalia

38

42

08

93

13

26

Springfield

37

13

03

93

17

32

Montana:

 

Anaconda

46

07

40

112

57

12

Billings

45

47

00

108

30

04

Butte

46

01

06

112

32

11

Glendive

47

06

42

104

43

02

Great Falls

47

29

33

111

18

23

Helena

46

35

33

112

02

24

Kalispell

48

11

45

114

18

44

Miles City

46

24

34

105

50

30

Missoula

46

52

23

113

59

29

Nebraska:

 

Albion

41

41

23

97

59

53

Alliance

42

06

04

102

52

08

Bassett

42

35

00

99

32

10

Grand Island

40

55

33

98

20

23

Hastings

40

35

21

98

23

20

Hayes Center

40

30

36

101

01

18

Hay Springs

42

41

03

102

41

22

Kearney

40

41

58

99

04

53

Lexington

40

46

30

99

44

41

Lincoln

40

48

59

96

42

15

McCook

40

12

02

100

37

32

Merriman

42

55

07

101

42

02

Norfolk

42

01

56

97

24

42

North Platte

41

08

14

100

45

43

Omaha

41

15

42

95

56

14

Scottsbluff

41

51

40

103

39

00

Superior

40

01

12

98

04

00

Nevada:

 

Elko

40

50

00

115

45

41

Henderson

36

02

00

114

58

57

Las Vegas

36

10

20

115

08

37

Reno

39

31

27

119

48

40

New Hampshire:

 

Berlin

44

28

20

71

10

43

Durham

43

08

02

70

55

35

Hanover

43

42

03

72

17

24

Keene

42

56

02

72

16

44

Lebanon

43

38

34

72

15

12

Littleton

44

18

22

71

46

13

Manchester

42

59

28

71

27

41

New Jersey:

 

Atlantic City

39

21

32

74

25

53

Burlington

40

04

21

74

51

47

Camden

39

56

45

75

07

20

Glen Ridge

40

48

16

74

12

14

Linden

40

37

57

74

15

22

Newark

40

44

14

74

10

19

New Brunswick

40

29

38

74

26

49

Paterson

40

54

51

74

09

51

Trenton

40

13

16

74

45

28

Vineland

39

29

13

75

01

17

Wildwood

38

59

18

74

48

43

New Mexico:

 

Albuquerque

35

05

01

106

39

05

Carlsbad

32

25

09

104

13

47

Clovis

34

24

11

103

12

08

Portales

34

10

58

103

20

10

Roswell

33

23

47

104

31

26

New York:

 

Albany

42

39

01

73

45

01

Binghamton

42

06

03

75

54

47

Buffalo

42

52

52

78

52

21

Carthage

43

58

50

75

36

26

Elmira

42

05

26

76

48

22

Garden City

40

43

26

73

38

03

Ithaca

42

26

33

76

29

42

Jamestown

42

05

45

79