[Federal Register Volume 85, Number 74 (Thursday, April 16, 2020)]
[Proposed Rules]
[Pages 21131-21139]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-07822]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 76
[MB Docket Nos. 20-70, 17-105, 11-131; FCC 20-39; FRS 16644]
Modernization of Media Regulation Initiative; Program Carriage
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: In this document, the Commission seeks comment on whether to
adopt changes to our rules governing the resolution of program carriage
disputes between video programming vendors and multichannel video
programming distributors (MVPDs) to ensure an expeditious dispute
resolution process. Specifically, we propose to modify one of the time
limit requirements for filing program carriage complaints in order to
make it consistent with the time limits for other types of complaints.
For consistency, we also propose to revise the parallel time limit
requirements for filing program access, open video system (OVS), and
good-faith retransmission consent complaints. We also propose to revise
the effective date and review procedures of initial decisions issued by
an administrative law judge (ALJ) in program carriage proceedings so
they comport with the Commission's generally applicable procedures for
review of ALJ initial decisions. We propose to extend this change to
program access and OVS proceedings as well.
DATES: Comments due on or before May 18, 2020; reply comments due on or
before June 1, 2020.
ADDRESSES: You may submit comments, identified by MB Docket Nos. 20-70,
17-105, 11-131, by any of the following methods:
[ssquf] Federal Communications Commission's website: http://apps.fcc.gov/ecfs/. Follow the instructions for submitting comments.
[ssquf] People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by email: [email protected] or phone: 202-418-
0530 or TTY: 202-418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: For additional information on this
proceeding, contact John Cobb, [email protected] of the Policy
Division, Media Bureau, (202) 418-2120.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Further Notice of Proposed Rulemaking and Notice of Proposed Rulemaking
(FNPRM), MB Docket Nos. 20-70, 17-105, 11-131; FCC 20-39, adopted on
March 31, 2020 and released on April 1, 2020. The full text of this
document is available for public inspection and copying during regular
business hours in the FCC Reference Center, Federal Communications
Commission, 445 12th Street SW, CY-A257, Washington, DC, 20554. The
full text of this document will also be available via ECFS (http://www.fcc.gov/cgb/ecfs/). (Documents will be available electronically in
ASCII, Word, and/or Adobe Acrobat.) The complete text may be purchased
from the Commission's copy contractor, 445 12th Street SW, Room CY-
B402, Washington, DC 20554. To request these documents in accessible
formats (computer diskettes, large print, audio recording, and
Braille), send an email to [email protected] or call the Commission's
Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice),
(202) 418-0432 (TTY).
Synopsis
This Further Notice of Proposed Rulemaking and Notice of Proposed
Rulemaking (FNPRM) proposes changes to the Commission's rules governing
the resolution of program carriage disputes between video programming
vendors and multichannel video programming distributors (MVPDs).
Specifically, we propose to modify one of the time limit requirements
for filing program carriage complaints in order to make it
[[Page 21132]]
consistent with the time limits for other types of complaints. For
consistency, we also propose to revise the parallel time limit
requirements for filing program access, open video system (OVS), and
good-faith retransmission consent complaints. We also propose to revise
the effective date and review procedures of initial decisions issued by
an administrative law judge (ALJ) in program carriage proceedings so
they comport with the Commission's generally applicable procedures for
review of ALJ initial decisions. We propose to extend this change to
program access and OVS proceedings as well. We believe that these
changes will help ensure an expeditious program access, program
carriage, retransmission consent, and OVS complaint process and provide
additional clarity to both potential complainants and defendants, as
well as adjudicators, consistent with the Communications Act of 1934,
as amended (the Act). With this proceeding, we continue our efforts to
modernize our media regulations.
Background. Congress passed the Cable Television Consumer
Protection and Competition Act of 1992 (1992 Cable Act) to, among other
goals, ``ensure that cable television operators do not have undue
market power vis-[agrave]-vis video programmers and consumers.''
Congress was concerned that the local market power then held by cable
operators along with increasing vertical integration in the industry
would hinder diversity and competition in the video programming market.
To address these concerns, Congress instructed the Commission in
section 616 of the Act to adopt regulations governing program carriage
agreements between MVPDs and video programming vendors. Specifically,
section 616 directed the Commission to prohibit several anti-
competitive practices, and to adopt procedures for expedited review of
program carriage complaints. In this FNPRM, we propose changes to two
of these procedural provisions: First, the statute of limitations, and
second, the rule governing the effective date of program carriage
decisions.
For a program carriage complaint to be considered timely, a
complainant must satisfy one of the three prongs of the statute of
limitations set forth in Sec. 76.1302(h) of the Commission's rules.
The first prong provides that a complaint is timely if it is filed
within one year of the date that the defendant MVPD enters into a
program carriage contract that a party alleges to violate the program
carriage rules. The second prong provides that a complaint is timely if
it is filed within one year of the date that the defendant MVPD
presents a carriage offer that a party alleges violates the program
carriage rules. The third prong of the statute of limitations for
program carriage complaints provides that a complaint ``must be filed
within one year of the date on which . . . [a] party has notified [an
MVPD] that it intends to file a complaint with the Commission based on
violations of one or more of the rules contained in this section.'' As
originally adopted in the 1993 Program Carriage Order, this third prong
included additional limiting language. In particular, it provided that
a complaint would be timely if it was filed within one year of the date
on which ``the complainant has notified [an MVPD] that it intends to
file a complaint with the Commission based on a request for carriage or
to negotiate for carriage of its programming on defendant's
distribution system that has been denied or unacknowledged, allegedly
in violation of one or more of the rules contained in this subpart.''
In the 1994 Program Carriage Order, however, the Commission removed
this limiting language without providing a rationale for this specific
modification. Subsequently, in 1999, while discussing an amendment made
to the second prong of the statutes of limitations for program access,
program carriage, and OVS complaints, the Commission suggested that the
third prong of these statutes of limitations is triggered when a
``defendant unreasonably refuses to negotiate with [the] complainant.''
We note that these three statutes of limitations were functionally
identical when originally adopted by the Commission. But while the 1994
amendment to Sec. 76.1302 removed any reference to a denial or non-
acknowledgement of a request to negotiate from the text of the
provision, the third prong of the other statutes of limitation was not
similarly modified. And although the Commission suggested in 1999 that
the third prong of the program carriage statute of limitations should
be interpreted consistent with the statutes of limitation for program
access and OVS complaints, in a series of decisions beginning in 2008,
the Media Bureau and Commission applied the third prong in a manner
consistent with the language of the rule.
Most recently, in the 2011 Program Carriage NPRM, the Commission
expressed concern that the third prong of the statute of limitations
could be read to mean that a complaint is timely if filed within one
year of when the complainant notified the defendant MVPD of its
intention to file, regardless of when the actual act alleged to have
violated the rules occurred. The Commission recognized that an
interpretation of the program carriage statute of limitations that
allows filing within one year of notice of intent to file, regardless
of when the allegedly unlawful conduct occurred, ``undermines the
fundamental purpose of a statute of limitations.'' Thus, the Commission
proposed to revise the rule in the 2011 Program Carriage NPRM by
replacing the three-pronged statute of limitations with a single
provision providing ``that a complaint must be filed within one year of
the act that allegedly violated the program carriage rules.''
The program carriage procedural rules also provide that the Chief
of the Media Bureau may refer a carriage dispute case to an ALJ after
determining that the complainant has established a prima facie
violation of Sec. 76.1301. Section 76.1302(j) then specifies that a
decision issued by an ALJ on the merits shall become effective upon
release, except in limited circumstances. If review of an ALJ decision
is sought, the rules require that the decision remain in effect pending
review, unlike the generally applicable procedures of Sec. 1.276(d),
that automatically stay an ALJ's initial decision pending review. We
note that while Congress instructed the Commission to adopt procedures
for expedited review of program carriage complaints, there is no
specific statutory requirement mandating that ALJ initial decisions
take immediate effect, nor that they remain in effect pending review.
These rules governing when an ALJ's initial decision in a program
carriage matter takes effect and whether it remains in effect pending
review have caused confusion for both parties and adjudicators, and
ultimately can create inconsistent outcomes pending appeal. In this
FNPRM, we propose rule changes to eliminate this confusion.
The procedural rules for program access complaints and OVS
complaints contain parallel provisions requiring that orders take
immediate effect and remain in effect pending review. Section 628 of
the 1992 Cable Act instructed the Commission to adopt procedures for
the expedited review of program access complaints. Accordingly, in the
1993 Program Access Order, the Commission adopted regulations providing
for the expedited review of program access complaints, including a
provision that ALJ initial decisions would take effect upon release.
The Commission subsequently adopted nearly identical procedures for the
filing of OVS complaints pursuant to section 653 of the Act, including
the rule providing that ALJ initial decisions would take
[[Page 21133]]
immediate effect. In 1999, the Commission consolidated review
procedures from the program carriage, program access, and OVS rules
into a newly created section, which provides that review of an initial
decision on the merits by an ALJ in any part 76 proceeding will be
handled in accordance with the Commission's general procedures, except
that orders issued pursuant to the program carriage, program access,
and OVS rules will remain in effect pending review.
In May 2017, the Commission launched a proceeding to review its
media regulations to eliminate or modify regulations that are outdated,
unnecessary, or unduly burdensome. Commenters in that proceeding
suggested that the program carriage rules should be reviewed and
updated as part of this initiative.
Discussion. This FNPRM seeks comment on two different proposals to
amend the part 76 procedural rules. First, we propose to revise the
program carriage statute of limitations provision in Sec. 76.1302(h)
to modify subsection (3) of that provision. As explained below, this
proposal differs from the proposal in the 2011 Program Carriage NPRM to
revise this same provision. Second, we propose to amend Sec. Sec.
76.10(c)(2), 76.1003(h)(1), 76.1302(j)(1), and 76.1513(h)(1) to provide
that review of all initial decisions issued by an ALJ pursuant to the
program access, program carriage, and OVS complaint rules will be
handled in accordance with the Commission's generally applicable
procedures for review of ALJ initial decisions. We believe that
amending these provisions as proposed will make the Commission's
procedures more consistent and encourage the timely resolution of
program carriage disputes.
Program Carriage Statute of Limitations. The third prong of the
program carriage statute of limitations provides that a complaint is
timely as long as it is filed within one year of the complainant
notifying the defendant of its intent to file a complaint with the
Commission, regardless of when the actual act alleged to have violated
the rules occurred. As discussed above, the Commission has previously
expressed concern that this undermines ``the fundamental purpose of a
statute of limitations `to protect a potential defendant against stale
and vexatious claims by ending the possibility of litigation after a
reasonable period of time has elapsed.' '' We propose to revise the
third prong of the program carriage statute of limitations to clarify
that it applies only in circumstances where there is not an existing
program carriage contract or contract offer and a defendant MVPD has
denied or failed to acknowledge either a request for program carriage
or a request to negotiate for program carriage. The revised rule will
provide that, ``in instances where there is no existing contract or an
offer for carriage,'' program carriage complaints relying on the third
triggering event must be filed within one year of the date on which
``[an MVPD] has denied or failed to acknowledge a request by a video
programming vendor for carriage or to negotiate for carriage of that
video programming vendor's programming on defendant's distribution
system, allegedly in violation of one or more of the [program carriage
rules].'' With this proposed revision, we intend to ensure that parties
file program carriage complaints on a timely basis and provide
certainty to both MVPDs and prospective complainants. We seek comment
on the potential effects of this proposal on the program carriage
complaint process and the parties involved.
We tentatively find persuasive comments responding to the 2011
Program Carriage NPRM suggesting that the Commission should
reincorporate limiting language that would make clear that the third
prong applies only in instances where an MVPD denies or fails to
acknowledge either a request for carriage or a request to negotiate for
carriage, similar to the language of the rule as originally adopted in
1993, rather than adopt the single statute of limitations provision
proposed in that item. We tentatively agree with commenters that this
revision would provide clarity as to when an MVPD's alleged violation
occurred and eliminate the possibility of an open-ended interpretation
of the program carriage statute of limitations, a concern raised by the
Commission itself and by multiple commenters in the 2011 proceeding.
Commenters in the 2011 proceeding argued that the proposal to replace
the three-pronged statute of limitations with a single provision would
not alleviate the problems caused by the current statute of
limitations, as it would ``effectively eliminate any time limitation by
allowing complaints to be filed within one year of any `alleged
violation' of the rules without any limitation on what `alleged
violations' program carriage claims may be based on.'' We seek comment
on this analysis. Would the revision proposed herein better fulfill the
general aim of a statute of limitations by protecting potential MVPD
defendants against ``stale and vexatious'' claims? Relatedly, would it
provide greater certainty for potential complainants regarding when
their claims expire? How should we determine when a potential defendant
has failed to acknowledge a request? Should we specify a set number of
days (e.g., 30 or 60) after the initial request for program carriage is
made by which the MVPD must acknowledge the request or else the statute
of limitations begins to run? If we specify a time period, should that
time period instead run from the date that the initial request is
received by the MVPD? What evidence should the Commission rely on in
determining when that request is made or received? What are other ways
that we could determine whether an MVPD has failed to acknowledge a
request? Are there other objective means by which we can make this
determination or is it inherently fact specific and thus better
determined on a case-by-case basis? How, if at all, would making the
changes discussed above affect the ability of MVPDs to file program
carriage complaints? What would the effect of this revision be on the
expeditious resolution of program carriage complaints by Commission
staff or an ALJ, an explicit goal of section 616? We encourage
commenters to provide specific examples where possible of how this
proposed revision, if adopted, would affect the resolution of program
carriage complaints.
We note that the statutes of limitations for program access, OVS,
and good-faith retransmission consent complaints contain a similar
triggering event that runs from the moment that a potential complainant
notifies a defendant that it intends to file a complaint based on a
denial or failure to acknowledge a request. For consistency, we propose
to revise those provisions so that the triggering event for each would
be the denial or failure to acknowledge a request, rather than notice
of intent to file a complaint on that basis. We seek comment on this
proposal. We propose to determine when a potential defendant has failed
to acknowledge a request with regard to program access, OVS, and good-
faith retransmission consent complaints in the same way we would make
this determination in the context of program carriage complaints. Or
are there reasons why these determinations should differ in the context
of these different types of substantive disputes?
We note that the Commission or Bureau has previously entertained
several program carriage complaints which involved a contract that
provided a defendant MVPD with the discretion to re-tier a complainant
programmer or to carry the complainant programmer on additional
systems. In those
[[Page 21134]]
proceedings, the complainant programmer had alleged that the defendant
MVPD exercised its discretion in a way that violated the program
carriage statute and rules. The Commission or Bureau found that such
complaints were timely filed under the third prong of the program
carriage statute of limitations. Would similar complaints be timely
filed under any of the three prongs of the program carriage statute of
limitations if we were to adopt the rule revisions proposed herein? If
not, how would complainant programmers be impacted? We propose to add
language to the third prong to clarify that it applies only in
circumstances where there is not an existing program carriage contract
or contract offer. Having agreed to a contractual provision that
provides an MVPD with the discretion to take future carriage actions
unilaterally, what basis, if any, would there be for allowing such
programmer to file a program carriage complaint when an MVPD exercises
that discretion?
We recognize that determining when an MVPD has denied or failed to
acknowledge a request for carriage or a request to negotiate for
carriage may require a fact-specific analysis and that parties may view
circumstances giving rise to the dispute differently. To the extent
necessary, we expect that the adjudicator will be able to resolve such
issues on a case-by-case basis. Relatedly, we tentatively disagree with
suggestions from comments to the 2011 Program Carriage NPRM that
complainants would manufacture triggering events, resulting in a
statute of limitations that lacks any clarity for defendant MVPDs. We
tentatively conclude that Pprt 76's general pleading requirements,
which prohibit the filing of false or frivolous claims and provide for
sanctions against parties doing so, would sufficiently dissuade parties
from filing vexatious claims in the program carriage context. We seek
comment on this tentative conclusion.
Some commenters responding to the 2011 Program Carriage NPRM argued
that the statute of limitations should not begin to run until
discriminatory conduct that is alleged to violate the program carriage
rules has become apparent to video programming vendors. Video
programming vendors suggested that they are at an information
disadvantage because they do not have access to all of the terms
offered by MVPDs to comparably situated vendors making it difficult to
determine whether they have a meritorious claim of discrimination. We
seek additional comment on this argument. For discriminatory conduct to
violate the program carriage rules, it must be ``on the basis of
affiliation or non-affiliation of'' programmers and it must
``unreasonably restrain the ability of an unaffiliated video
programming vendor to compete fairly.'' If an MVPD makes an offer or
the parties enter into a contract that discriminates ``on the basis of
affiliation or non-affiliation of'' programmers and to an extent that
it unreasonably restrains the ability of an unaffiliated video
programming vendor to compete fairly, then the video programming vendor
has one year from the date on which that offer was made or that
contract was executed to file a complaint with the Commission. Does
this preclude video programming vendors from being eligible to file
meritorious program carriage complaints because of their alleged
information disadvantage? Other commenters alleged that MVPDs ``have
historically strung out negotiations with unaffiliated programmers,
permitting them to discriminate against unaffiliated vendors without
ever having to issue a formal denial.'' We seek comment on this
argument. Are there alternative proposals that would address these
issues, while still foreclosing stale and vexatious claims?
Review of Initial ALJ Decisions. The differences between the part 1
and part 76 review procedures for ALJ initial decisions have caused
confusion for both adjudicators and parties in program carriage
proceedings. The part 76 review procedures for ALJ initial decisions
contain two major differences from the part 1 procedures. First, ALJ
decisions following the part 1 procedures do not take effect for at
least 50 days following release, while part 76 provides that they take
immediate effect. Second, part 1 provides that ALJ decisions are stayed
automatically upon the filing of exceptions, while part 76 provides
that ALJ decisions will remain in effect pending review. To address
this confusion, we propose to amend the program access, program
carriage, and OVS procedural rules so that review of initial decisions
issued by an ALJ is handled in accordance with the Commission's
generally applicable procedures in part 1 of our rules for review of
ALJ initial decisions. In practice, this will mean that decisions on
the merits issued by an ALJ in program access, program carriage, and
OVS proceedings will not take effect before 50 days after issuance and
decisions will be automatically stayed upon the filing of exceptions by
an aggrieved party.
We tentatively conclude that this revision would reduce the
potential for confusion by making the part 76 procedures consistent
with the Commission's generally applicable procedures in part 1 of our
rules for review of ALJ initial decisions. We seek comment on this
proposal. Are there valid reasons for requiring that ALJ initial
decisions in program access, program carriage, and OVS proceedings take
effect upon release, but delaying the effectiveness of ALJ initial
decisions in other contexts? Further, what are the reasons, if any, for
allowing ALJ initial decisions in program access, program carriage, and
OVS proceedings to remain in effect while the parties seek review?
Would there be any potential negative effects for consumers from making
this change? Are there any potential negative effects for complainants?
Would there be any harms to complainants from staying the effect of ALJ
initial decisions during review that could not be alleviated by
extending the effect of the remedial order commensurate with the length
of the stay? Would any potential costs to complainants resulting from
our proposed rule revisions outweigh the benefits? Commenters are
encouraged to provide specific examples where possible. What, if any,
other technical rule revisions would reduce confusion in the
application of these ALJ review procedures and aid in the efficient
resolution of program access, program carriage, and OVS complaints by
ALJs?
We also propose a simple technical edit in the respective program
access, program carriage, and OVS provisions to make clear that
decisions under those rules may be issued by the Commission, Commission
staff, or an ALJ. This revision does not reflect a substantive change
to the rules and would merely increase the clarity of the program
access, program carriage and OVS rules. Are there any additional
proposals related to the effective date of program access, program
carriage, and OVS complaint decisions issued by ALJs that we should
consider as a part of this proceeding?
Other Program Carriage Proposals. The 2011 Program Carriage NPRM
sought comment on a number of additional issues related to the
Commission's program carriage rules, including: Revising the discovery
procedures; permitting the award of damages; adopting a best ``final
offer'' dispute resolution model; heightening the evidentiary showing
to obtain a mandatory carriage remedy; explicitly prohibiting
retaliation for filing a complaint; adopting a good-faith negotiation
rule; clarifying what constitutes discrimination; and codifying the
burden of proof requirements for discrimination cases.
[[Page 21135]]
Given the significant amount of time that has passed since the 2011
Program Carriage NPRM and the vast changes in the media marketplace in
the intervening years, we seek comment on whether those proposals are
necessary to ensure an efficient program carriage marketplace.
Initial Regulatory Flexibility Act Analysis. As required by the
Regulatory Flexibility Act of 1980, as amended (RFA), the Commission
has prepared an Initial Regulatory Flexibility Analysis (IRFA) relating
to this NPRM. The IRFA is set forth below.
Paperwork Reduction Act. This NPRM may result in new or revised
information collection requirements subject to the Paperwork Reduction
Act of 1995, Public Law 104-13 (44 U.S.C. 3501 through 3520). If the
Commission adopts any new or revised information collection
requirement, the Commission will publish a notice in the Federal
Register inviting the public to comment on the requirement, as required
by the Paperwork Reduction Act of 1995, Public Law 104-13 (44 U.S.C.
3501-3520). In addition, pursuant to the Small Business Paperwork
Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), the
Commission seeks specific comment on how it might ``further reduce the
information collection burden for small business concerns with fewer
than 25 employees.''
Ex Parte Rules--Permit-But-Disclose. This proceeding shall be
treated as a ``permit-but-disclose'' proceeding in accordance with the
Commission's ex parte rules. Ex parte presentations are permissible if
disclosed in accordance with Commission rules, except during the
Sunshine Agenda period when presentations, ex parte or otherwise, are
generally prohibited. Persons making ex parte presentations must file a
copy of any written presentation or a memorandum summarizing any oral
presentation within two business days after the presentation (unless a
different deadline applicable to the Sunshine period applies). Persons
making oral ex parte presentations are reminded that memoranda
summarizing the presentation must (1) list all persons attending or
otherwise participating in the meeting at which the ex parte
presentation was made, and (2) summarize all data presented and
arguments made during the presentation. Memoranda must contain a
summary of the substance of the ex parte presentation and not merely a
listing of the subjects discussed. More than a one or two sentence
description of the views and arguments presented is generally required.
If the presentation consisted in whole or in part of the presentation
of data or arguments already reflected in the presenter's written
comments, memoranda or other filings in the proceeding, the presenter
may provide citations to such data or arguments in his or her prior
comments, memoranda, or other filings (specifying the relevant page
and/or paragraph numbers where such data or arguments can be found) in
lieu of summarizing them in the memorandum. Documents shown or given to
Commission staff during ex parte meetings are deemed to be written ex
parte presentations and must be filed consistent with Sec. 1.1206(b)
of the rules. In proceedings governed by Sec. 1.49(f) of the rules or
for which the Commission has made available a method of electronic
filing, written ex parte presentations and memoranda summarizing oral
ex parte presentations, and all attachments thereto, must be filed
through the electronic comment filing system available for that
proceeding, and must be filed in their native format (e.g., .doc, .xml,
.ppt, searchable .pdf). Participants in this proceeding should
familiarize themselves with the Commission's ex parte rules.
Filing Requirements--Comments and Replies. Pursuant to Sec. Sec.
1.415 and 1.419 of the Commission's rules, 47 CFR 1.415, 1.419,
interested parties may file comments and reply comments on or before
the dates indicated on the first page of this document. Comments may be
filed using the Commission's Electronic Comment Filing System (ECFS).
See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR
24121 (1998).
Electronic Filers: Comments may be filed electronically
using the internet by accessing the ECFS: http://fjallfoss.fcc.gov/ecfs2/.
Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing.
Filings can be sent by commercial overnight courier, or by first-
class or overnight U.S. Postal Service mail. All filings must be
addressed to the Commission's Secretary, Office of the Secretary,
Federal Communications Commission.
Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to 9050 Junction Drive,
Annapolis Junction, MD 20701.
U.S. Postal Service first-class, Express, and Priority
mail must be addressed to 445 12th Street SW, Washington, DC 20554.
Effective March 19, 2020, and until further notice, the Commission
no longer accepts any hand or messenger delivered filings. This is a
temporary measure taken to help protect the health and safety of
individuals, and to mitigate the transmission of COVID-19. See FCC
Announces Closure of FCC Headquarters Open Window and Change in Hand-
Delivery Policy, Public Notice, DA 20-304 (Mar. 19, 2020) available
https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy.
During the time the Commission's building is closed to the general
public and until further notice, if more than one docket or rulemaking
number appears in the caption of a proceeding, paper filers need not
submit two additional copies for each additional docket or rulemaking
number; an original and one copy are sufficient.
People with Disabilities. To request materials in accessible
formats for people with disabilities (Braille, large print, electronic
files, audio format), send an email to [email protected] or call the FCC's
Consumer and Governmental Affairs Bureau at (202) 418-0530 (voice),
(202) 418-0432 (TTY).
Availability of Documents. Comments and reply comments will be
publicly available online via ECFS. These documents will also be
available for public inspection during regular business hours in the
FCC Reference Information Center, which is located in Room CY-A257 at
FCC Headquarters, 445 12th Street SW, Washington, DC 20554. The
Reference Information Center is open to the public Monday through
Thursday from 8:00 a.m. to 4:30 p.m. and Friday from 8:00 a.m. to 11:30
a.m.
Initial Regulatory Flexibility Analysis. As required by the
Regulatory Flexibility Act of 1980, as amended (RFA), the Commission
has prepared this present Initial Regulatory Flexibility Analysis
(IRFA) concerning the possible significant economic impact on small
entities by the policies and rules proposed in the Further Notice of
Proposed Rulemaking and Notice of Proposed Rulemaking (FNPRM). Written
public comments are requested on this IRFA. Comments must be identified
as responses to the IRFA and must be filed by the deadlines for
comments provided on the first page of the FNPRM. The Commission will
send a copy of the FNPRM, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration (SBA). In addition, the
FNPRM and IRFA (or summaries thereof) will be published in the Federal
Register.
Need for, and Objectives of, the Proposed Rules. Congress passed
the Cable Television Consumer Protection
[[Page 21136]]
and Competition Act of 1992 (1992 Cable Act) to, among other goals,
``ensure that cable television operators do not have undue market power
vis-[agrave]-vis video programmers and consumers.'' Congress was
concerned that the local market power held by cable operators along
with increased vertical integration in the industry would hinder
diversity and competition in the video programming market. To address
these concerns, Congress instructed the Commission in section 616 of
the 1992 Cable Act to adopt regulations governing program carriage
agreements between MVPDs and video programming vendors. Section 616
directed the Commission to adopt procedures for expedited review for
complaints filed pursuant to section 616 and provide for penalties and
remedies for violations of the same.
This FNPRM seeks comment on two different proposals to amend the
part 76 procedural rules. First, we propose to revise the program
carriage statute of limitations provision in Sec. 76.1302(h) to revise
subsection (3) to clarify that it applies only in circumstances where
there is not an existing program carriage contract or contract offer
and a defendant MVPD has denied or failed to acknowledge either a
request for program carriage or a request to negotiate for program
carriage. For consistency, we propose to revise the parallel program
access, OVS, and good-faith retransmission consent rules, so that the
triggering event for each would be the denial or failure to acknowledge
a request, rather than notice of intent to file a complaint on that
basis, as we propose to do with the program carriage rules here.
Second, we propose to amend Sec. Sec. 76.10(c)(2), 76.1003(h)(1),
76.1302(j)(1), and 76.1513(h)(1) to provide that all initial decisions
issued by an administrative law judge (ALJ) pursuant to the program
access, program carriage, and OVS rules will not take effect before 50
days after issuance and decisions will be automatically stayed upon the
filing of exceptions by an aggrieved party in accordance with the
Commission's generally applicable procedures for review of ALJ
decisions. We believe that amending these provisions as proposed will
better ensure that program access, program carriage, OVS, and good-
faith retransmission consent complaints are addressed expeditiously by
providing additional clarity to both potential complainants and
defendants, consistent with Congress's intent in the Act, and will
apply existing Commission procedures uniformly.
Legal Basis. The proposed action is authorized pursuant to 1, 4(i),
4(j), 616, 628, and 653 of the Communications Act of 1934, as amended,
47 U.S.C. 151, 154(i), 154(j), 536, 548, and 573.
Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply. The RFA directs agencies to provide a
description of, and where feasible, an estimate of the number of small
entities that may be affected by the proposed rules, if adopted. The
RFA generally defines the term ``small entity'' as having the same
meaning as the terms ``small business,'' ``small organization,'' and
``small governmental jurisdiction.'' In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act. A small business concern is one which:
(1) Is independently owned and operated; (2) is not dominant in its
field of operation; and (3) satisfies any additional criteria
established by the SBA. Below, we provide a description of such small
entities, as well as an estimate of the number of such small entities,
where feasible.
Cable Companies and Systems (Rate Regulation Standard). The
Commission has developed its own small business size standards, for the
purpose of cable rate regulation. Under the Commission's rules, a
``small cable company'' is one serving 400,000 or fewer subscribers,
nationwide. Industry data indicate that, of 4,200 cable operators
nationwide, all but 9 are small under this size standard. In addition,
under the Commission's rules, a ``small system'' is a cable system
serving 15,000 or fewer subscribers. Industry data indicate that, of
4,200 systems nationwide, 3,900 have fewer than 15,000 subscribers,
based on the same records. Thus, under this second size standard, the
Commission believes that most cable systems are small.
Cable System Operators (Telecommunications Act Standard). The Act
also contains a size standard for small cable system operators, which
is ``a cable operator that, directly or through an affiliate, serves in
the aggregate fewer than 1 percent of all subscribers in the United
States and is not affiliated with any entity or entities whose gross
annual revenues in the aggregate exceed $250,000,000.'' There are
approximately 49,011,210 cable subscribers in the United States today.
Accordingly, an operator serving fewer than 490,112 subscribers shall
be deemed a small operator, if its annual revenues, when combined with
the total revenues of all its affiliates, do not exceed $250 million in
the aggregate. Based on the available data, we find that all but five
independent cable operators are affiliated with entities whose gross
annual revenues exceed $250 million. Although it seems certain that
some of these cable system operators are affiliated with entities whose
gross annual revenues exceed $250 million, we note that the Commission
neither requests nor collects information on whether cable system
operators are affiliated with entities whose gross annual revenues
exceed $250 million, and therefore we are unable to estimate more
accurately the number of cable system operators that would qualify as
small under the definition in the Communications Act.
Direct Broadcast Satellite (DBS) Service. DBS service is a
nationally distributed subscription service that delivers video and
audio programming via satellite to a small parabolic dish antenna at
the subscriber's location. DBS is now included in SBA's economic census
category ``Wired Telecommunications Carriers.'' The Wired
Telecommunications Carriers industry comprises establishments primarily
engaged in operating and/or providing access to transmission facilities
and infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired telecommunications
networks. Transmission facilities may be based on a single technology
or combination of technologies. Establishments in this industry use the
wired telecommunications network facilities that they operate to
provide a variety of services, such as wired telephony services,
including VoIP services, wired (cable) audio and video programming
distribution; and wired broadband internet services. By exception,
establishments providing satellite television distribution services
using facilities and infrastructure that they operate are included in
this industry. The SBA determines that a wireline business is small if
it has fewer than 1,500 employees. Economic census data for 2012
indicate that 3,117 wireline companies were operational during that
year. Of that number, 3,083 operated with fewer than 1,000 employees.
Based on that data, we conclude that the majority of wireline firms are
small under the applicable standard. Currently, however, only two
entities provide DBS service, which requires a great deal of capital
for operation: DIRECTV (owned by AT&T) and DISH Network. DIRECTV and
DISH Network each report annual revenues that are in excess of the
threshold for a small business. Accordingly, we conclude that, in
general, DBS service is provided only by large firms.
Motion Picture and Video Production. The Census Bureau defines this
category as follows: ``This industry comprises
[[Page 21137]]
establishments primarily engaged in producing, or producing and
distributing motion pictures, videos, television programs, or
television commercials.'' We notes that firms in this category may be
engaged in various industries, including cable programming. Specific
figures are not available regarding how many of these firms produce
and/or distribute programming for cable television. The SBA has
developed a small business size standard for this category, which is:
All such firms having $35,000,000 or less in annual revenue. To gauge
small business prevalence in the Motion Picture and Video Production
industries, the Commission relies on data currently available from the
U.S. Census Bureau for the year 2012. Census Bureau data for 2012 show
that there were 8,203 firms in this category that operated for the
entire year. Of these, 8075 firms had annual receipts of $24,999,999 or
less, and 61 firms had annual receipts exceeding $50,000,000. 67 firms
had annual receipts between $25,000,000 and $49,000,000. Thus, under
this category and associated small business size standard, the majority
of firms can be considered small.
Motion Picture and Video Distribution. The Census Bureau defines
this category as follows: ``This industry comprises establishments
primarily engaged in acquiring distribution rights and distributing
film and video productions to motion picture theaters, television
networks and stations, and exhibitors.'' We note that firms in this
category may be engaged in various industries, including cable
programming. Specific figures are not available regarding how many of
these firms produce and/or distribute programming for cable television.
The SBA has developed a small business size standard for this category
which is: All such firms having $34,500,000 million or less in annual
revenue. To gauge small business prevalence in the Motion Picture and
Video Distribution industries, the Commission relies on data currently
available from the U.S. Census Bureau for the year 2012. Census Bureau
data for 2012 show that there were 307 firms in this category that
operated for the entire year. Of these, 294 firms had annual receipts
of $24,999,999 or less, and 8 firms had annual receipts exceeding
$50,000,000. 5 firms had annual receipts between $25,000,000 and
$49,000,000. Thus, under this category and associated small business
size standard, the majority of firms can be considered small.
Television Broadcasting. This Economic Census category ``comprises
establishments primarily engaged in broadcasting images together with
sound.'' These establishments operate television broadcast studios and
facilities for the programming and transmission of programs to the
public. These establishments also produce or transmit visual
programming to affiliated broadcast television stations, which in turn
broadcast the programs to the public on a predetermined schedule.
Programming may originate in their own studio, from an affiliated
network, or from external sources. The SBA has created the following
small business size standard for such businesses: Those having $41.5
million or less in annual receipts. The 2012 Economic Census reports
that 751 firms in this category operated in that year. Of this number,
656 had annual receipts of less than $25 million, 25 had annual
receipts ranging from $25 million to $49,999,999, and 70 had annual
receipts of $50 million or more. Based on this data we therefore
estimate that the majority of commercial television broadcasters are
small entities under the applicable SBA size standard.
Additionally, the Commission has estimated the number of licensed
commercial television stations to be 1,374. Of this total, 1,282
stations (or 94.2%) had revenues of $41.5 million or less in 2018,
according to Commission staff review of the BIA Kelsey Inc. Media
Access Pro Television Database (BIA) on April 15, 2019, and therefore
these licensees qualify as small entities under the SBA definition. In
addition, the Commission estimates the number of licensed noncommercial
educational (NCE) television stations to be 388. The Commission does
not compile and does not have access to information on the revenue of
NCE stations that would permit it to determine how many such stations
would qualify as small entities.
We note, however, that in assessing whether a business concern
qualifies as ``small'' under the above definition, business (control)
affiliations must be included. Our estimate, therefore, likely
overstates the number of small entities that might be affected by our
action, because the revenue figure on which it is based does not
include or aggregate revenues from affiliated companies. In addition,
another element of the definition of ``small business'' requires that
an entity not be dominant in its field of operation. We are unable at
this time to define or quantify the criteria that would establish
whether a specific television broadcast station is dominant in its
field of operation. Accordingly, the estimate of small businesses to
which rules may apply does not exclude any television station from the
definition of a small business on this basis and is therefore possibly
over-inclusive.
There are also 387 Class A stations. Given the nature of these
services, the Commission presumes that all of these stations qualify as
small entities under the applicable SBA size standard. In addition,
there are 1,892 LPTV stations and 3,621 TV translator stations. Given
the nature of these services as secondary and in some cases purely a
``fill-in'' service, we will presume that all of these entities qualify
as small entities under the above SBA small business size standard.
Description of Projected Reporting, Recordkeeping, and Other
Compliance Requirements. As discussed above, this FNPRM proposes two
revisions to the part 76 procedural rules. The first revision concerns
the statute of limitations provision contained in Sec. 76.1302(h) and
would insert limiting language to clarify that it applies only in
circumstances where there is not an existing program carriage contract
or contract offer and a defendant MVPD has denied or failed to
acknowledge either a request for program carriage or a request to
negotiate for program carriage. For consistency, we propose to revise
the parallel program access, OVS, and good-faith retransmission consent
rules, so that the triggering event for each would be the denial or
failure to acknowledge a request, rather than notice of intent to file
a complaint on that basis, as we propose to do with the program
carriage rules here. The second would amend Sec. 76.1302(j)(1) to
provide that initial decisions by an administrative law judge are
automatically stayed upon the filing of exceptions by an aggrieved
party, rather than only in the event of an order mandating carriage of
a video programming vendor's content that requires a defendant MVPD to
delete existing programming from its system to accommodate carriage.
For consistency, we propose to extend this change to parallel
provisions in program access, Sec. 76.1003(h)(1), and OVS, Sec.
76.1513(h)(1), proceedings as well. These revisions should result in a
more streamlined and clear part 76 complaint process, which would
ultimately reduce the burden on entities potentially involved in part
76 complaints.
Steps Taken to Minimize Significant Economic Impact on Small
Entities and Significant Alternatives Considered. The RFA requires an
agency to describe any significant alternatives that it has considered
in reaching its proposed approach, which may include the following four
alternatives (among others): (1) The establishment of differing
compliance or reporting
[[Page 21138]]
requirements or timetables that take into account the resources
available to small entities; (2) the clarification, consolidation, or
simplification of compliance or reporting requirements under the rule
for small entities; (3) the use of performance, rather than design,
standard; and (4) an exemption from coverage of the rule, or any part
thereof, for small entities.
Through this FNPRM, the Commission seeks to minimize the burdens
associated with the resolution of program carriage, program access,
OVS, and good-faith retransmission consent complaints, by clarifying
that the third triggering for all four types of complaints is the
denial or failure to acknowledged a request and providing for automatic
stays of initial decisions by an ALJ pending review for program
carriage, program access, and OVS complaints. It is our hope that these
revisions will aid in the expeditious resolution of program access,
program carriage, OVS, good-faith retransmission consent complaints
consistent with the Act. These changes would reduce the costs
associated with litigating program access, program carriage, OVS, good-
faith retransmission consent complaints before the Commission by
eliminating any confusion surrounding the statute of limitations in all
four contexts and eliminating the need to seek a stay of an initial
decision issued by an ALJ pending review for program carriage, program
access, and OVS complaints. The Commission invites comment on
alternative proposals that we should consider that would better
minimize any adverse impact on small businesses, while still furthering
the goal of reducing the costs associated with the efficient resolution
of part 76 complaints.
Federal Rules that May Duplicate, Overlap or Conflict With the
Proposed Rule. None.
It is ordered that, pursuant to the authority found in sections 1,
4(i), 4(j), 303(r), 616, 628, and 653 of the Communications Act of
1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 303(r), 536, 548, and
573, this Further Notice of Proposed Rulemaking in MB Docket No. 11-131
and Notice of Proposed Rulemaking in MB Docket No. 20-70 is adopted. It
is further ordered that the Commission's Consumer and Governmental
Affairs Bureau, Reference Information Center, shall send a copy of this
Further Notice of Proposed Rulemaking in MB Docket No. 11-131 and
Notice of Proposed Rulemaking in MB Docket No. 20-70, including the
Initial Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
List of Subjects in 47 CFR Part 76
Administrative practice and procedure, Cable Television.
Federal Communications Commission.
Cecilia Sigmund,
Federal Register Liaison Officer, Office of the Secretary.
Proposed Rules
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR part 76 as follows:
PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE
0
1. The authority citation for part 76 continues to read as follows:
Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303,
303a, 307, 308, 309, 312, 315, 317, 325, 338, 339, 340, 341, 503,
521, 522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548,
549, 552, 554, 556, 558, 560, 561, 571, 572, 573.
0
2. Amend Sec. 76.10 by revising paragraph (c)(2) to read as follows:
Sec. 76.10 Review.
* * * * *
(c) * * *
(2) Any party to a part 76 proceeding aggrieved by any decision on
the merits by an administrative law judge may file an appeal of the
decision directly with the Commission, in accordance with Sec. Sec.
1.276(a) and 1.277(a) through (c) of this chapter.
0
3. Amend Sec. 76.65 by revising paragraph (e)(3) to read as follows:
Sec. 76.65 Good faith and exclusive retransmission consent
complaints.
* * * * *
(e) * * *
(3) The television broadcast station or multichannel video
programming distributor has denied, unreasonably delayed, or failed to
acknowledge a request to negotiate retransmission consent in violation
of one or more of the rules contained in this subpart.
* * * * *
0
4. Amend Sec. 76.1003 by revising paragraphs (g)(3) and (h)(1) to read
as follows:
Sec. 76.1003 Program access proceedings.
* * * * *
(g) * * *
(3) A cable operator, or a satellite cable programming vendor or a
satellite broadcast programming vendor has denied or failed to
acknowledge a request to purchase or negotiate to purchase satellite
cable programming, satellite broadcast programming, or terrestrial
cable programming, or has made a request to amend an existing contract
pertaining to such programming pursuant to Sec. 76.1002(f), allegedly
in violation of one or more of the rules contained in this subpart.
(h) Remedies for violations-- (1) Remedies authorized. Upon
completion of such adjudicatory proceeding, the Commission, Commission
staff, or Administrative Law Judge shall order appropriate remedies,
including, if necessary, the imposition of damages, and/or the
establishment of prices, terms, and conditions for the sale of
programming to the aggrieved multichannel video programming
distributor. Such order shall set forth a timetable for compliance.
Such order issued by the Commission or Commission staff shall be
effective upon release. See 47 CFR 1.102(b); 1.103. The effective date
of such order issued by the Administrative Law Judge is set forth in 47
CFR 1.276(d).
* * * * *
0
5. Amend Sec. 76.1302 by revising paragraphs (h)(1) and (3) and (j)(1)
to read as follows:
Sec. 76.1302 Carriage agreement proceedings.
* * * * *
(h) * * *
(1) The multichannel video programming distributor enters into a
contract with a video programming vendor that a party alleges to
violate one or more of the rules contained in this section; or
* * * * *
(3) In instances where there is no existing contract or an offer
for carriage, the multichannel video programming distributor has denied
or failed to acknowledge a request by a video programming vendor for
carriage or to negotiate for carriage of that video programming
vendor's programming on defendant's distribution system, allegedly in
violation of one or more of the rules contained in this section.
* * * * *
(j) Remedies for violations--(1) Remedies authorized. Upon
completion of such adjudicatory proceeding, the Commission, Commission
staff, or Administrative Law Judge shall order appropriate remedies,
including, if necessary, mandatory carriage of a video programming
vendor's programming on defendant's video distribution system, or the
establishment of prices, terms, and conditions for the carriage of a
video programming vendor's programming. Such order shall set forth a
timetable for compliance. The effective date of such order issued by
the Administrative Law Judge is set forth in 47 CFR 1.276(d). Such
order
[[Page 21139]]
issued by the Commission or Commission staff shall become effective
upon release, see 47 CFR 1.102(b), 1.103, unless any order of mandatory
carriage issued by the staff would require the defendant multichannel
video programming distributor to delete existing programming from its
system to accommodate carriage of a video programming vendor's
programming. In such instances, if the defendant seeks review of the
staff decision, the order for carriage of a video programming vendor's
programming will not become effective unless and until the decision of
the staff is upheld by the Commission. If the Commission upholds the
remedy ordered by the staff or administrative law judge in its
entirety, the defendant MVPD will be required to carry the video
programming vendor's programming for an additional period equal to the
time elapsed between the staff or administrative law judge decision and
the Commission's ruling, on the terms and conditions approved by the
Commission.
* * * * *
0
6. Amend Sec. 76.1513 by revising paragraphs (g)(3) and (h)(1) to read
as follows:
Sec. 76.1513 Open video dispute resolution.
* * * * *
(g) * * *
(3) An open video system operator has denied or failed to
acknowledge a request for such operator to carry the complainant's
programming on its open video system, allegedly in violation of one or
more of the rules contained in this part.
(h) Remedies for violations--(1) Remedies authorized. Upon
completion of such adjudicatory proceeding, the Commission, Commission
staff, or Administrative Law Judge shall order appropriate remedies,
including, if necessary, the requiring carriage, awarding damages to
any person denied carriage, or any combination of such sanctions. Such
order shall set forth a timetable for compliance. Such order issued by
the Commission or Commission staff shall be effective upon release. See
47 CFR 1.102(b); 1.103. The effective date of such order issued by the
Administrative Law Judge is set forth in 47 CFR 1.276(d).
* * * * *
[FR Doc. 2020-07822 Filed 4-15-20; 8:45 am]
BILLING CODE 6712-01-P