Federal Register: PROPOSED RULES Carriage of Digital Television Broadcast Signals; Implementation of the Satellite Home Viewer Improvement Act of 1999: [47 CFR Part 76]

FEDERAL COMMUNICATIONS COMMISSION

Federal Communications Commission

CFR Citation: 47 CFR Part 76

Docket ID: [CS Docket No. 00-96; FCC 08-86]

NOTICE: PROPOSED RULES

ACTION: Carriage of Digital Television Broadcast Signals; Implementation of the Satellite Home Viewer Improvement Act of 1999:

DOCUMENT ACTION: Proposed rule.

SUBJECT CATEGORY: Carriage of Digital Television Broadcast Signals; Implementation of the Satellite Home Viewer Improvement Act of 1999: Local Broadcast Signal Carriage Issues and Retransmission Consent Issues

DATES: Comments for this proceeding are due on or before June 4, 2008; reply comments are due on or before June 19, 2008.

DOCUMENT SUMMARY: This document seeks comment on the application of the statutory requirement for nondiscriminatory treatment in carriage of standard definition (``SD'') and high definition (``HD'') signals. Satellite
[[Page 24516]]
carriers should be required to carry the signals of all local broadcast stations in HD and SD if they carry the signals of any local station in the same market in both HD and SD so that subscribers without HD capable equipment will be able to view all stations. That is, the Commission seeks comment on whether the Communications Act would prohibit satellite carriers from carrying some broadcast stations in both HD and SD but not others.

SUMMARY: Local Broadcast Signal Carriage Issues and Retransmission Consent Issues,

SUPPLEMENTAL INFORMATION

This is a summary of the Commission's Second Further Notice of Proposed Rulemaking in CS Docket No. 0096, FCC 08 86, adopted March 19, 2008, and released March 27, 2008. 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., CYA257, Washington, DC 20554. These documents will also be available via ECFS (http:// www.fcc.gov/cgb/ecfs/). (Documents will be available electronically in ASCII, Word 97, and/or Adobe Acrobat.) The complete text may be purchased from the Commission's copy contractor, 445 12th Street, SW., Room CYB402, Washington, DC 20554. To request this document in accessible formats (computer diskettes, large print, audio recording, and Braille), send an email to fcc504@fcc.gov or call the Commission's Consumer and Governmental Affairs Bureau at (202) 4180530 (voice), (202) 4180432 (TTY).
Summary of the Notice of Proposed Rulemaking

I. Second Further Notice of Proposed Rulemaking

1. We seek comment on the scope of satellite carriers' carriage obligations under Section 338 of the Act as the HD carriage requirement becomes effective. In those markets, satellite carriers will be carrying the HD signals from all stations broadcasting in HD. But many subscribers in those markets may not have HDcapable settop boxes on all sets connected to the DBS system. In such markets, carriage of only an HD signal would mean that those subscribers without HDcapable equipment would not be able to view the programming.

2. In such circumstances, satellite carriers may wish to provide separate SD broadcast feeds in addition to the mandated HD feeds. We seek comment on whether satellite carriers should be required to carry the signals of all local broadcast stations in HD and SD if they carry the signals of any local station in the same market in both HD and SD. That is, we seek comment on whether the Act would prohibit satellite carriers from carrying some broadcast stations in both HD and SD but not otherse.g., under the carryone, carryall provisions of section 338(a) of the Act or the nondiscrimination provisions of section 338(d) of the Act.

3. We also seek comment on the applicability of section 338(g)(2) of the Act, added in 2004, which provides that ``[i]f the carrier retransmits signals in the digital television service, the carrier shall retransmit such digital signals in such market by means of a single reception antenna and associated equipment.'' In local markets where a satellite carrier carries the signal of at least one local broadcaster in both HD and SD format, we seek comment on whether this provision requires that the operator do so for all broadcast stations in that market.

4. Finally, we seek comment on the petition for rulemaking filed by Rancho Palos Verdes (``RPV Petition''), which asks the Commission to adopt rules for satellite carriers that would be similar to the ``viewability'' provisions governing cable operators. The statutory bases for the cable viewability rules do not appear to have express DBS equivalents. We seek comment on whether satellite carriers nonetheless have an obligation, under sections 338(a), (d), (g), or any other provision, to provide all subscribers in a localintolocal market with the ability to view all stations carried pursuant to carryone, carry all requirements. As a policy matter, should the Commission impose such a requirement in the interests of regulatory parity and for the benefit of consumers?

5. Requiring similar treatment among broadcast stations could help ensure that consumers in localintolocal markets continue to receive all of their local broadcast signals, regardless of their subscription package. On the other hand, we seek comment on the impact of such a requirement on satellite carriers' ability to add localintolocal markets or to meet the HD implementation schedule set forth in the Order (Adopted: 3/19/08, Released: 3/27/08). We seek comment on these and any other legal, factual, or policy issues raised by the above discussion.
II. Procedural Matters

A. Initial Regulatory Flexibility Analysis

6. As required by the Regulatory Flexibility Act of 1980 (``RFA''), the Commission has prepared an Initial Regulatory Flexibility Analysis (``IRFA'') relating to this Second Further Notice of Proposed Rulemaking. The IRFA is set forth in Appendix B.

7. As required by the Regulatory Flexibility Act of 1980, as amended (``RFA''), the Commission has prepared this Initial Regulatory Flexibility Analysis (``IRFA'') of the possible economic impact on a substantial number of small entities by the policies and rules proposed in this Second Further Notice of Proposed Rulemaking (``Second Further NPRM''). 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 on the Second Further NPRM as indicated on the first page of the Order. The Commission will send a copy of the Second Further NPRM, including this IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (``SBA''). In addition, the Second Further NPRM and IRFA (or summaries thereof) will be published in the Federal Register.

1. Need for, and Objectives of, the Proposals

8. This Second Further NPRM seeks comment on the scope of satellite carriers' carriage obligations under
[[Page 24517]]
section 338 of the Act as the HD carriage requirement becomes effective. It asks whether satellite carriers should be required to carry the signals of all local broadcast stations in HD and SD if they carry the signals of any local station in the same market in both HD and SD. It also asks whether satellite carriers have an obligation, under sections 338(a), (d), (g), or any other provision, to provide all subscribers in a localintolocal market with the ability to view all stations carried pursuant to carryone, carry all requirements. It seeks comment on whether, as a policy matter, the Commission should impose such a requirement, and on the impact of such a requirement on satellite carriers' ability to add localintolocal markets or to meet the HD implementation schedule set forth in the Order. Finally, it seeks comment on any other legal, factual or policy issues raised by the discussion in the Further Notice itself.

2. Legal Basis

9. The authority for the action proposed in this rulemaking is contained in sections 4(i), 4(j), 303(r), 325, 336, 338, 614, and 615 of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 303(r), 325, 336, 338, 534, and 535.
3. Description and Estimate of the Number of Small Entities To Which the Proposals Will Apply

10. The RFA directs the Commission to provide a description of and, where feasible, an estimate of the number of small entities that will be affected by the rules adopted herein. The RFA defines the term ``small entity'' as having the same meaning as the terms ``small business,'' ``small organization,'' and ``small business concern'' under Section 3 of the Small Business Act. 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 Small Business Administration (SBA). The rules adopted herein will directly affect small television broadcast stations and small satellite carriers. A description of these small entities, as well as an estimate of the number of such small entities, is provided below.

11. Television Broadcasting. The SBA defines a television broadcasting station as a small business if such station has no more than $13.0 million in annual receipts. Business concerns included in this industry are those ``primarily engaged in broadcasting images together with sound.'' The Commission has estimated the number of licensed commercial television stations to be 1,376. According to Commission staff review of the BIA Publications, Inc. Master Access Television Analyzer Database (BIA) on March 30, 2007, about 986 of an estimated 1,374 commercial television stations (or approximately 72 percent) have revenues of $13.0 million or less and thus qualify as small entities under the SBA definition. 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. The Commission has estimated the number of licensed noncommercial educational (NCE) television stations to be 380. The Commission does not compile and otherwise does not have access to information on the revenue of NCE stations that would permit it to determine how many such stations would qualify as small entities.

12. In addition, an element of the definition of ``small business'' is that the entity not be dominant in its field of operation. We are unable at this time to define or quantify the criteria that would establish whether a specific television station is dominant in its field of operation. Accordingly, the estimate of small businesses to which rules may apply do not exclude any television station from the definition of a small business on this basis and are therefore over inclusive to that extent. Also as noted, an additional element of the definition of ``small business'' is that the entity must be independently owned and operated. We note that it is difficult at times to assess these criteria in the context of media entities and our estimates of small businesses to which they apply may be overinclusive to this extent.

13. Satellite Carriers. The term ``satellite carrier'' includes entities providing services as described in 17 U.S.C. 119(d)(6) using the facilities of a satellite or satellite service licensed under Part 25 of the Commission's rules to operate in Direct Broadcast Satellite (``DBS'') or FixedSatellite Service (``FSS'') frequencies. As a general practice, not mandated by any regulation, DBS licensees usually own and operate their own satellite facilities as well as package the programming they offer to their subscribers. In contrast, satellite carriers using FSS facilities often lease capacity from another entity that is licensed to operate the satellite used to provide service to subscribers. These entities package their own programming and may or may not be Commission licensees themselves. In addition, a third situation may include an entity using a nonU.S. licensed satellite to provide programming to subscribers in the United States pursuant to a blanket earth station license. Since 2007, the SBA has recognized satellite television distribution services within the broad economic census category of Wired Telecommunications Carriers. The SBA has developed a small business size standard for this category, which is: All such firms having 1,500 or fewer employees. The most current Census Bureau data, however, are from the last economic census of 2002, and we will use those figures to gauge the prevalence of small businesses in this category. Those size standards are for the two census categories of ``Satellite Telecommunications'' and ``Other Telecommunications.'' Under both prior categories, such a business was considered small if it had $13.5 million or less in average annual receipts.

14. Direct Broadcast Satellite (DBS) Service. DBS service is a nationally distributed subscription service that delivers video and audio programming via satellite to a small parabolic ``dish'' antenna at the subscriber's location. Because DBS provides subscription services, DBS falls within the SBArecognized definition of Wired Telecommunications Carriers. However, as discussed above, we rely on the previous size standard, Cable and Other Subscription Programming, which provides that a small entity is one with $13.5 million or less in annual receipts. Currently, only two operatorsDirecTV and EchoStar Communications Corporation (``EchoStar'')hold licenses to provide DBS service, which requires a great investment of capital for operation. Both currently offer subscription services and report annual revenues that are in excess of the threshold for a small business. Because DBS service requires significant capital, we believe it is unlikely that a small entity as defined by the SBA would have the financial wherewithal to become a DBS licensee. Nevertheless, given the absence of specific data on this point, we acknowledge the possibility that there are entrants in this field that may not yet have generated $13.5 million in annual receipts, and therefore may be categorized as a small business, if independently owned and operated.

15. FixedSatellite Service (``FSS''). The FSS is a radiocommunication service between earth stations at a
[[Page 24518]]
specified fixed point or between any fixed point within specified areas and one or more satellites. The FSS, which utilizes many earth stations that communicate with one or more space stations, may be used to provide subscription video service. Therefore, to the extent FSS frequencies are used to provide subscription services, FSS falls within the SBArecognized definition of Wired Telecommunications Carriers. However, as discussed above, we rely on the previous size standard, Cable and Other Subscription Programming, which provides that a small entity is one with $13.5 million or less in annual receipts. Although a number of entities are licensed in the FSS, not all such licensees use FSS frequencies to provide subscription services. Both of the DBS licensees (EchoStar and DirecTV) have indicated interest in using FSS frequencies to broadcast signals to subscribers. It is possible that other entities could similarly use FSS frequencies, although we are not aware of any entities that might do so.
4. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements for Small Entities

16. The Second Further NPRM seeks comment on rules that would primarily impose requirements on satellite carriers, and as discussed above few if any satellite carriers qualify as small entities. Small satellite carriers currently have obligations with respect to carriage of local commercial and noncommercial broadcast stations. The obligations would be increased by the rules contemplated in the Further Notice of Proposed Rulemaking (Further NPRM), but would not change in kind. As with existing statutory and regulatory requirements, small satellite carriers will need engineering and legal services to comply with the proposed rules, but if the proposed rules are implemented we do not anticipate that this need will be any different for small carriers than for large carriers. Small broadcast stations would be affected by the proposed rules, although likely in a positive way, and could be affected by other proposals raised in response to the Further NPRM. Also, initially, broadcasters may need additional legal services. 5. Steps Taken To Minimize Significant Economic Impact on Small Entities, and Significant Alternatives Considered

17. 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 requirements or timetables that take into account the resources available to small entities; (2) the clarification, consolidation, or simplification of compliance or reporting requirements under the rule for small entities; (3) the use of performance, rather than design, standards; and (4) an exemption from coverage of the rule, or any part thereof, for small entities. We seek comment on the applicability of any of these alternatives to affected small entities.

18. The requirements proposed in the Second Further NPRM would in most cases create minimal economic impact on small entities, and in some cases could provide positive economic impact. Station licensees and other parties are encouraged to submit comment on the proposals' impact on small television stations. Every effort will be made to minimize the impact of any adopted proposals on small satellite carriers. Finally, we are mindful of the potential concerns of small entities and will, therefore, continue to carefully scrutinize our policy determinations going forward. We invite small entities to submit comment on how the Commission could further minimize potential burdens on small entities if the proposals provided in the Second Further NPRM, or those submitted into the record, are ultimately adopted. 6. Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rules

19. None.

B. Initial Paperwork Reduction Act Analysis

20. This Second Further Notice of Proposed Rulemaking has been analyzed with respect to the PRA and does not contain proposed information collection requirements. In addition, therefore, it does not contain any new or modified ``information collection burden for small business concerns with fewer than 25 employees,'' pursuant to the Small Business Paperwork Relief Act of 2002.

C. Ex Parte Rules

21. PermitButDisclose. This proceeding will be treated as a ``permitbutdisclose'' proceeding subject to the ``permitbut disclose'' requirements under section 1.1206(b) of the Commission's Rules. Ex parte presentations are permissible if disclosed in accordance with Commission Rules, except during the Sunshine Agenda period when presentations, ex parte or otherwise, are generally prohibited. Persons making oral ex parte presentations are reminded that a memorandum summarizing a presentation must contain a summary of the substance of the presentation and not merely a listing of the subjects discussed. More than a one or twosentence description of the views and arguments presented is generally required. Additional rules pertaining to oral and written presentations are set forth in section 1.1206(b).

D. Filing Requirements

22. Comments and Replies. Pursuant to sections 1.415 and 1.419 of the Commission's Rules, interested parties may file comments on or before June 4, 2008, and reply comments on or before June 19, 2008, using: (1) The Commission's Electronic Comment Filing System (``ECFS''), (2) the Federal Government's eRulemaking Portal, or (3) by filing paper copies.

Electronic Filers: Comments may be filed electronically using the Internet by accessing the ECFS: http://www.fcc.gov/cgb/ecfs/ or the Federal eRulemaking Portal: http://www.regulations.gov. Filers should follow the instructions provided on the Web site for submitting comments.

For ECFS filers, if multiple docket or rulemaking numbers appear in the caption of this proceeding, filers must transmit one electronic copy of the comments for each docket or rulemaking number referenced in the caption. In completing the transmittal screen, filers should include their full name, U.S. Postal Service mailing address, and the applicable docket or rulemaking number. Parties may also submit an electronic comment by Internet email. To get filing instructions, filers should send an email to ecfs@fcc.gov, and include the following words in the body of the message, ``get form.'' A sample form and directions will be sent in response.

Paper Filers: Parties who choose to file by paper must file an original and four copies of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, filers must submit two additional copies for each additional docket or rulemaking number.

Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by firstclass or overnight U.S. Postal Service mail (although we continue to experience delays in receiving U.S. Postal Service mail). All filings must be addressed to the Commission's Secretary, Office of the Secretary, Federal Communications Commission.

The Commission's contractor will receive handdelivered or messengerdelivered paper filings for the
[[Page 24519]]
Commission's Secretary at 236 Massachusetts Avenue, NE., Suite 110, Washington, DC 20002. The filing hours at this location are 8 a.m. to 7 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building.

Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.

U.S. Postal Service firstclass, Express, and Priority mail must be addressed to 445 12th Street, SW., Washington, DC 20554.

23. Availability of Documents. Comments, reply comments, and ex parte submissions will be available for public inspection during regular business hours in the FCC Reference Center, Federal Communications Commission, 445 12th Street, SW., CYA257, Washington, DC 20554. These documents will also be available via ECFS. Documents will be available electronically in ASCII, Word 97, and/or Adobe Acrobat.

24. Accessibility Information. To request information in accessible formats (computer diskettes, large print, audio recording, and Braille), send an email to fcc504@fcc.gov or call the FCC's Consumer and Governmental Affairs Bureau at (202) 4180530 (voice), (202) 418 0432 (TTY). This document can also be downloaded in Word and Portable Document Format (PDF) at: http://www.fcc.gov. E. Additional Information

25. For more information on this Second Further Notice of Proposed Rule Making, please contact Lyle Elder, Lyle.Elder@fcc.gov, or Eloise Gore, Eloise.Gore@fcc.gov, of the Media Bureau, Policy Division, (202) 4182120.

26. It is further ordered that the Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Second Further Notice of Proposed Rule Making, including the Final and Initial Regulatory Flexibility Analyses, to the Chief Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 76

Cable television, Digital television, Multichannel video programming distributors, Reporting and recordkeeping requirements. Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. E89747 Filed 5208; 8:45 am]
BILLING CODE 671201P

FOR FURTHER INFORMATION CONTACT For more information on this proceeding, please contact Lyle Elder, Lyle.Elder@fcc.gov, or Eloise Gore, Eloise.Gore@fcc.gov, of the Media Bureau, Policy Division, (202) 4182120.