Evergreen Broadcasting Corp.; ) CSR-3897-A WJAC, Incorporated; and Gateway ) Communications, Inc

Federal Communications Commission DA 96-792

Before the Federal Communications Commission Washington, D.C. 20554

In re: ) ) Evergreen Broadcasting Corp.; ) CSR-3897-A WJAC, Incorporated; and Gateway ) Communications, Inc. ) ) For Modification of the ADIs of ) Stations WWCP-TV, WJAC-TV, and ) WTAJ-TV )

MEMORANDUM OPINION AND ORDER

Adopted: May 20, 1996 Released: May 28, 1996

By the Deputy Chief, Cable Services Bureau:

INTRODUCTION

1. Evergreen Broadcasting Corp. ["WWCP-TV"], licensee of television broadcast station WWCP-TV (Fox, Channel 8), Johnstown, Pennsylvania; WJAC, Incorporated ["WJAC- TV"], licensee of station WJAC-TV (NBC, Channel 6), Johnstown, Pennsylvania; and Gateway Communications, Inc. ["WTAJ-TV], licensee of station WTAJ-TV (CBS, Channel 10), Altoona, Pennsylvania [collectively, "Petitioners"], have jointly filed the captioned petition seeking to include 62 communities in Indiana County, Pennsylvania within the Johnstown-Altoona, Pennsylvania "area of dominant influence" for purposes of the cable television mandatory broadcast signal carnage rules. The petition is opposed by The Hearst Corporation ["WTAE- TV"], licensee of station WTAE-TV (ABC, Channel 4), Pittsburgh, Pennsylvania, and by WPXI, Inc. ["WPXI"], licensee of station WPXI (NBC, Channel 11), Pittsburgh, Pennsylvania. Petitioners have replied.1

BACKGROUND

2. Pursuant to §614 of the Communications Act and implementing rules adopted by the Commission in its Report and Order in MM Docket 92-259,2 commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the

1 Two of the affected municipalities, Armagh Borough and East Wheatfield Township, have also submitted comments in support of the petition.

1 8 FCC Red 2965, 2976-2977 (1993). 19184 Federal Communications Commission DA 96-792 station©s market. A station©s market for this purpose is its "area of dominant influence" or ADI as defined by the Arbitron audience research organization.3 An ADI is a geographic market designation that defines each television market exclusive of others, based on measured viewing patterns. Essentially, each county in the United States is allocated to a market based on which home-market stations receive a preponderance of total viewing hours in the county. For purposes of this calculation, both over-the-air and cable television viewing are included.4

3. Under the Act, however, the Commission is also directed to consider changes in ADI areas. Section 614(h)(l)(C) provides that the Commission may:

with respect to a particular television broadcast station, include additional communities within its television market or exclude communities from such station©s television market to better effectuate the purposes of this section.

In considering such requests, the Act provides that:

the Commission shall afford particular attention to the value of localism by taking into account such factors as

(I) whether the station, or other stations located in the same area, have been historically carried on the cable system or systems within such community;

(II) whether the television station provides coverage or other local service to such community;

(HI) whether any other television station that is eligible to be carried by a cable system in such community in fulfillment of the requirements of this section provides news coverage of issues of concern to such community or provides carriage or coverage of sporting and other events of interest to the community; and

1 Section 76.55(e) of the Commission©s Rules provides that the ADIs to be used for purposes of the initial implementation of the mandatory carriage rules are those published in Arbitron©s 1991-1992 Television Market Guide.

4 Because of the topography involved, certain counties are divided into more than one sampling unit Also, in certain circumstances, a station may have its home county assigned to an ADI even though it receives less than a preponderance of the audience in mat county. For a more complete description of how counties are allocated, see Arbitron©s Description of Methodology.

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(TV) evidence of viewing patterns in cable and noncable households within the areas served by the cable system or systems in such community.5

4. The legislative history of this provision indicates that:

where the presumption in favor of ADI carriage would result in cable subscribers losing access to local stations because they are outside the ADI in which a local cable system operates, the FCC may make an adjustment to include or exclude particular communities from a television station©s market consistent with Congress© objective to ensure that television stations be carried in the areas which they serve and which form their economic market.

[This subsection] establishes certain criteria which the Commission shall consider in acting on requests to modify the geographic area in which stations have signal carriage rights. These factors are not intended to be exclusive, but may be used to demonstrate that a community is part of a particular station©s market.6

5. The Commission provided guidance in its Report and Order in MM Docket 92- 259, supra, to aid decision making in these matters, as follows:

For example, the historical carriage of the station could be illustrated by the submission of documents listing the cable system©s channel line-up (e.g., rate cards) for a period of years. To show that the station provides coverage or other local service to the cable community (factor 2), parties may demonstrate that the station places at least a Grade B coverage contour over the cable community or is located close to the community in terms of mileage. Coverage of news or other programming of interest to the community could be demonstrated by program logs or other descriptions of local program offerings. The final factor concerns viewing patterns in the cable community in cable and noncable homes. Audience data clearly provide appropriate evidence about this factor. In this regard, we note that surveys such as those used to demonstrate significantly viewed status could be useful. However, since this factor requires us to evaluate viewing on a community basis for cable and noncable homes, and significantly viewed surveys typically measure viewing only in noncable households, such

3 Communications Act of 1934, as amended, §614(h)(l)(C)(ii), 47 U.S.C. §534(h)(l)(CXii).

6 H.R. Rep. No. 628, 102d Cong., 2d Sess. 97 (1992).

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surveys may need to be supplemented with additional data concerning viewing in cable homes.7

6. In adopting rules to implement this provision, the Commission indicated that changes requested should be considered on a community-by-community basis rather than on a county-by-county basis and that they should be treated as specific to particular stations rather than applicable in common to all stations in the market.8 The rules further provide, in accordance with the requirements of the Act, that a station not be deleted from carriage during the pendency of an market area change request.9

7. Adding communities to a station©s market area generally entitles that station to insist on cable carriage in those communities. However, this right is subject to several conditions: 1) a cable system operator is generally required to devote no more than one-third of its activated channel capacity to compliance with the mandatory signal carnage obligations, 2) the station is responsible for delivering a good quality signal to the principal headend of the system, 3) indemnification may be required for any increase in copyright liability resulting from carriage, and 4) the system operator is not required to carry the signal of any station whose signal substantially duplicates the signal of any other local signal carried or the signals of more than one local station affiliated with a particular broadcast network. If, pursuant to these requirements, a system operator elects to carry the signal of only a single affiliate of a broadcast network, it is obliged to carry the affiliate from within the market whose city of license is closest to the principal headend of the cable system.10 Accordingly, based on the specific circumstances involved, the addition of communities to a station©s market area may guarantee it cable carriage and specific channel position rights; simply provide the system operator with an expanded list of must-carry signals from which to choose, i.e., when it has used up its channel capacity mandated for broadcast signals carriage, or determined which of duplicating network affiliated stations are entitled to carriage priority.

MARKET FACTS AND ARGUMENTS OF THE PARTIES

8. The communities in question are located within Indiana County, Pennsylvania, which is part of the Pittsburgh, Pennsylvania ADI, which is adjacent to Petitioners© Johnstown- Altoona, Pennsylvania ADI, immediately to its west. Indiana, Pennsylvania, the County Seat of

7 8 FCC Red at 2977 (emphasis in original).

© 8 FCC Red at 2977 n.139. Viewership data cited herein is county data, rather than community-specific data. However, absent evidence that such data is not fairly reflective of viewing in the actual communities in question, we accept such data as probative in cases of this type.

10 8 FCC Red at 2981.

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Indiana County, located approximately in the county©s center, is about 22 miles northwest of Johnstown, about 40 miles west of Altoona, and about 48 miles east of Pittsburgh.

9. Petitioners state that most cable systems in the communities in question have carried the stations© signals: those of WJAC-TV and WTAJ-TV since the inception of cable service in the 1950s, and that of WWCP-TV since the station went on the air in 1986. Petitioners note that WWCP-TV and WJAC-TV cover most of Indiana County with Grade A contours, and encompass all the communities with Grade B contours, while WTAJ-TV©s Grade B contour covers most of the communities, save for the westernmost. Petitioners claim that they provide extensive coverage of news, sports, weather, emergencies, and other events of interest to the communities. WWCP-TV makes general reference to over 300 stories in 1992, and particularly notes events in the town of Indiana and sports events at Indiana University of Pennsylvania ["IUP"]. WJAC-TV also notes its carriage of HJP-produced public service announcements. Petitioners state that they provide Community Bulletin Boards and Calendars, as well as internship programs for IUP students and other educational programs. Petitioners argue that stations licensed to the Pittsburgh ADI do not provide significant service to the communities in question. This is, petitioners maintain, reflected in local viewing patterns, which demonstrate that WWCP-TV, WJAC-TV, and WTAJ-TV achieve higher viewing ratings than do the stations© Pittsburgh counterparts.11 Petitioners also claim that a consumer research study performed for WJAC-TV shows that 56.7% of Indiana County residents visited malls in the Johnstown-Altoona market, and only 19.1% visited Pittsburgh malls. In addition, 34% of high school graduates from the Johnstown-Altoona metropolitan area enrolled in IUP, which measures 10.7% of its full-time enrollment from the metropolitan area, and "many residents of Indiana County commute to work in the Johnstown-Altoona ADI and vice versa," state Petitioners.

10. In opposition, WTAE-TV argues that, contrary to Petitioners© assertions, it in fact does provide significant service and events coverage to the communities in question. Petitioners, on the other hand, WTAE-TV states, make no distinctions among the communities in question, but merely make general claims about service to Indiana County as a whole. This, contends WTAE-TV, is insufficient to meet the standards of the 1992 Cable Act to warrant special relief. Most of the population centers of Indiana County, WTAE-TV contends, are in the western portion of the County, nearest Pittsburgh, and identify more with that city and ADI. Indeed,

" Citing February 1993 Nielsen data for Indiana County, Petitioners claim that WJAC-TV©s noon news program received a 48% share, while Pittsburgh affiliates combined received a 13% share. Petitioners state that Monday through Friday, 6:00-6:30 pm, WJAC-TV and WTAJ-TV received a combined share of 41%, while WPXI and Station KDKA-TV (CBS, Channel 2), Pittsburgh, Pennsylvania received a combined 21% share. For the 11:00 pm news program slot, Petitioners state that WJAC-TV and WTAJ-TV received a combined 33% share, while WPXI and KDKA-TV received a combined 24% share. Petitioners also state that their combined Monday through Friday prime time shares exceed those of their Pittsburgh competitors (the specific ratings for each station are: WWCP-TV = 7%, Station WPGH-TV (Fox, Channel 53), Pittsburgh, Pennsylvania = 4%; WJAC-TV = 17%, WPXI = 4%; WTAJ-TV = 9%, KDKA-TV = 15%). Petitioners argue, too, that WWCP-TV©s children©s programming is more highly rated than that of WPGH-TV (6% from 7:00 am to 9:00 am as compared with 0%, and 12% from 3:00 to 5:00 pm as compared with 3%.

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WTAE-TV argues, Petitioners concede that WATM-TV (ABC, Channel 23), Altoona, Pennsylvania, is viewed less in Indiana County than is WTAE-TV.

11. WPXI argues in opposition that Indiana County as a whole is nearly equidistant between Pittsburgh and Altoona, and that Petitioners fail to submit WTAJ-TV©s consumer research survey for examination and analysis. Nor, asserts WPXI, do petitioners sufficiently document their other claims. In fact, notes WPXI, information provided by IUP "indicat[esj that approximately 27.5% of lUP©s full-time students come from the Pittsburgh MSA, compared to approximately 10% from the Johnstown and Altoona MS As." The identification of Indiana County with the Pittsburgh area is further underscored, states WPXI, by newspaper circulation figures, which reveal that Pittsburgh daily newspapers have a 4.6% daily circulation in Indiana County. Coupled with the 1.6% daily circulation of the Greensburg newspaper (a city within the Pittsburgh ADI), these figures are together more than twice the circulation of the Johnstown newspaper (2.7%). Sunday circulation, states WPXI, is even more divergent: 19.2% for Pittsburgh newspapers, 12.9% for Greensburg, and only 2.4% for Johnstown.

12. Turning to the factors specified in the 1992 Cable Act, WPXI states that Petitioners merely assert a general history of carriage in Indiana County without providing any corroborating data, and even concede lack of carriage on certain systems. No specific instances of programming to and for the communities in question are submitted by Petitioners, WPXI contends, but rather just WWCP-TV©s general claims of programming of interest to Indiana County. WJAC-TV and WTAJ-TV, WPXI notes, provide no such information. Petitioners fail, states WPXI, to demonstrate that Pittsburgh ADI stations do not serve the communities in question. Moreover, argues WPXI, Petitioners© selected viewing data fail to account for the two ADIs1 ABC affiliates, WATM-TV and WTAE-TV. WPXI contends that 1993 Nielsen data for both ADIs in their entirety demonstrate that Pittsburgh market stations achieve higher ratings than do Johnstown-Altoona market stations.

13. In reply, Petitioners submit lists of those cable systems serving the communities in question that carry WWCP-TV, WJAC-TV, and WTAJ-TV. In addition, WJAC-TV submits a voluminous list of those stories it aired between August 1, 1992 and July 31, 1993 concerning the communities in question. WWCP-TV states that it archives its news stories by county, not by community, and thus cannot produce a community-specific analysis of its news and events coverage. Nevertheless, notes WWCP-TV, it covered 300 stories affecting Indiana County in 1992, and these stories "originated throughout Indiana County." WTAJ-TV states that it has covered stories concerning IUP and the community of Indiana, as well as other events in the communities in question. Petitioners again contend that the Pittsburgh ADI stations fail to demonstrate that they serve the communities in question to any great extent, and that this is in fact reflected in Nielsen audience data.12 Moreover, state Petitioners, questions regarding

12 Citing 1993 Nielsen data, Petitioners state that WJAC-TV©s sign-on to sign-off share in Indiana County was 26%, while that of WPXI was 8%. WJAC-TV©s 6:00 pm and 11:00 pm news programs received 37% and 30% shares, respectively, while WPXI during those same time periods received 7% and 11% shares, respectively. WWCP-TV©s

19189 Federal Communications Commission DA 96-792

WATM-TV©s service are irrelevant to the instant case, in which WATM-TV is not a party. Nor, contend Petitioners, are circulation figures for newspapers relevant to the question of the local service actually provided by Petitioners to the communities in question.

ANALYSIS AND DECISION

14. Petitioners generally argue, addressing the third statutory criterion, that Pittsburgh ADI licensees do not serve the communities in question as well as Petitioners do, and that audience viewership data reflects this. Opponents contend that they in fact do serve the communities in question better than do Petitioners, and that this is particularly true for WTAE- TV, the Pittsburgh ABC affiliate. In general, we do not believe that Congress intended this third criterion to operate as a bar to a station©s ADI claim whenever other stations could also be shown to serve the communities at issue. Rather, we believe that this criterion was intended to enhance a station©s claim where it could be shown that other stations do not serve the communities at issue. Under such circumstances, a denial of carriage rights to the claiming station could deprive cable viewers of any broadcast signals that might provide programming geared to their communities. In this case, as Pittsburgh ADI stations clearly do serve the communities in question to varying extents, this enhancement factor would not appear to be applicable. Moreover, the fact that the Johnstown-Altoona ABC affiliate, WATM-TV, appears to barely serve the communities in question - its Grade B contour encompasses only the extreme easternmost portion of Indiana County, and Arbitron records no measurable viewing of the station in Indiana County -- is not relevant to the petition before us. WATM-TV has taken no part in this petition, which only affects WWCP-TV, WJAC-TV, and WTAJ-TV.

WWCP-TV

15. With regard to the first statutory factor, WWCP-TV has submitted evidence demonstrating its historic carriage on all but one of the cable systems serving the communities in question. Turning to the fourth factor, that of area viewing patterns, Arbitron audience data for Indiana County reveal that in noncable households, WWCP-TV is clearly the Fox affiliate of choice. The station receives a total share of 12 and a net weekly circulation of 78, as compared with unmeasurable data for WPGH-TV©s total share and net weekly circulation. In cable homes, WWCP-TV receives a total share of 5 and a net weekly circulation of 57. Though this is less than WPGH-TV©s ratings in cable homes (a total share of 6 and a net weekly circulation of 67), WWCP-TV still receives a significant audience share in cable homes, in which WPGH-TV©s viewing is boosted by cable carriage. Petitioners© submitted Nielsen data support this analysis. See footnotes 11 and 12, supra.

sign-on to sign-off share was 4%, state Petitioners, while WPGH-TV©s was 2%. WWCP-TV©s prime time share (which include its 10:00-11:00 pm news program) was 7%, while WPGH-TV©s share was 4%. Petitioners note that WTAJ-TV also received "significant ratings," its sign-on to sign-off share being 6% (compared with KDKA-TV©s 10%), and its prime time share being 7% (compared with KDKA-TV©s 13%).

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16. For the second statutory factor provision of coverage or other local service to the communities - WWCP-TV states that it encompasses all the communities in question with either a Grade A or a Grade B contour. We have previously stated that this is acceptable demonstrative evidence for this factor.13 However, WPXI states that WWCP-TV has provided only claims of service generically to Indiana County. In response, WWCP-TV reiterates its claim of service to Indiana County as a whole. Though the station claims that its programming originates throughout Indiana County, WWCP-TV states that it does not maintain a community- specific story archive. In fact, the only specific community WWCP-TV provides evidence of programming for is the town of Indiana. With regard to the second factor, WWCP-TV clearly only provides evidence of programming to the community of Indiana.

17. Clearly, WWCP-TV satisfies the fourth statutory factor hi all of the communities in question, and the first factor in all but one. With respect to the fourth factor, we recognize that this determination is based on county-wide data, rather than community-specific data. Absent evidence that such data are not fairly reflective of viewing hi the actual communities in question, we shall accept such data as probative, although not conclusive, in cases of this type.14 In the present case, WTAE-TV©s claim that Indiana County©s population centers are clustered in the county©s western portion is not borne out by examination of maps of the area.15 The viewership data clearly demonstrate WWCP-TV©s substantial viewership, in both noncable and cable homes. As noted in paragraph 14, supra, WWCP-TV does not receive any enhancement under the third factor. Nevertheless, as noted in paragraph 8, supra, WWCP-TV©s city of license, Johnstown, is twice as close to the center of Indiana County as is Pittsburgh. Accordingly, in view of the totality of the circumstances before us, we shall grant WWCP-TV©s request with respect to all of the communities in question.

13 See MM Docket 92-259, 8 FCC Red at 2977. See also paragraph 5, supra.

14 See footnote 9, supra.

" See, e.g., Rand McNally Commercial Atlas & Marketing Guide (125th ed. 1994).

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WJAC-TV

18. With regard to the first statutory factor, WJAC-TV has submitted evidence demonstrating its historic carriage in the communities in question. Turning to the fourth factor, Arbitron audience data for Indiana County reveal that in noncable households, WJAC-TV is clearly the NBC affiliate of choice. The station receives a total share of 38 and a net weekly circulation of 98, as compared with WPXTs total share of 4 and net weekly circulation of 40. In fact, WJAC-TV©s are the highest viewership ratings for a station in noncable homes in Indiana County recorded by Arbitron. In cable homes, WJAC-TV receives a total share of 13 and a net weekly circulation of 71, as compared with WPXTs total share of 15 and net weekly circulation of 71. WPGH-TV from Pittsburgh receives little viewership in the area, see paragraph 16, supra. This analysis is generally supported by Petitioners© submitted Nielsen data. See footnotes 11 and 12, supra.

19. For the second statutory factor, WJAC-TV states that it encompasses all of the communities in question with either a Grade A or a Grade B contour. In response to WPXTs opposition that no community-specific data is provided, WJAC-TV submits program logs demonstrating programming specific to 21 of the communities in question,16 as well as to Indiana County as a whole.

20. As does WWCP-TV, WJAC-TV satisfies the fourth factor in all of the communities in question, and also satisfies the first factor as well. As noted in paragraph 14, supra, WJAC-TV does not receive any enhancement under the third factor. With regard to the second factor, WJAC-TV provides clear evidence of specific local programming service to 21 of the communities in question, and encompasses all of the communities with either a Grade A or a Grade B contour. We also note that WJAC-TV©s city of license, Johnstown, is twice as close to the center of Indiana County as is Pittsburgh. Accordingly, in view of the foregoing, we shall grant WJAC-TV©s request for market modification as well.

WTAJ-TV

21. With regard to the first statutory factor, WTAJ-TV has submitted evidence demonstrating its historic carriage in most of the communities in question. Turning to the fourth factor, Arbitron audience data for Indiana County reveal that in noncable households, WTAJ-TV receives a total share of 5 and a net weekly circulation of 32, as compared with KDKA-TV©s total share of 10 and net weekly circulation of 70. In cable homes, WTAJ-TV receives a total share of 2 and a net weekly circulation of 57, as compared with KDKA-TV©s total share of 6 and net weekly circulation of 67. KDKA-TV©s audience share is clearly superior in viewing off-air to WTAJ-TV in Indiana County. Petitioners© own submitted Nielsen data also indicate that KDKA-

" These communities are Armagh, Aultman, Black Lick, Blairsville, Brush Valley, Cherry Tree, Clymer, Creekside, Dixonville, East Wheatfield Township, Ernest, Glen Campbell, Homer City, Indiana, Marion Center, Rayne Township, Rossiter, Saltsburg, Seward, West Wheatfield Township, and White Township.

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22. For the second statutory factor, WTAJ-TV merely states that its Grade B contour covers most but not all of the communities in Indiana County.17 Even following WPXTs opposing rebuttal of lack of specific programming information, WTAJ-TV fails to provide additional evidence of programming specific to the communities in question.

23. WTAJ-TV satisfies the first statutory factor in most of the communities in question. However, with respect to the second factor, despite stating that its Grade B contour encompasses most of the communities in question, WTAJ-TV provides no specific evidence in response to WPXTs contention that WTAJ-TV fails to program to the communities. With regard to the fourth factor, though WTAJ-TV is viewed in all of the communities, it is less widely viewed than is the Pittsburgh ADI CBS affiliate, unlike the situation with WWCP-TV and WJAC-TV. This is also demonstrated by Petitioners© submitted Nielsen audience data. As noted in paragraph 14, supra, WTAJ-TV does not receive any enhancement under the third factor. Moreover, as noted in paragraph 8, supra, Indiana County is approximately equidistant between Pittsburgh and Altoona, WTAJ-TV©s city of license. This is in contrast to the much closer proximity between Indiana County and Johnstown, the city of license of WWCP-TV and WJAC- TV. The totality of the circumstances as presented to us, therefore, shows that WTAJ-TV is not strongly viewed in the communities in question, several of which lie beyond or at the edge of the station©s Grade B contour, and which, geographically, have no compelling connection with WTAJ-TV. Accordingly, we find that Petitioners have not sufficiently made a case for grant of relief with respect to WTAJ-TV.

24. Accordingly, for purposes of determining mandatory signal carriage obligations, we shall consider the Indiana County, Pennsylvania communities in question to be part of the Johnstown-Altoona, Pennsylvania ADI with respect to both WWCP-TV and WJAC-TV, as well as within the Pittsburgh, Pennsylvania ADI. These determinations are subject to all generally applicable limitations on signal carriage rights, including copyright liability, signal quality, channel capacity, and program duplication. See paragraph 7, supra.

ORDER

25. In view of the foregoing, we find that grant of the instant petition is in the public interest only to the extent indicated at paragraph 24, supra.

26. Accordingly, IT IS ORDERED, pursuant to §614 of the Communications Act of 1934, as amended (47 U.S.C. §534), and §76.59 of the Commission©s Rules (47 C.F.R. §76.59), That the captioned petition for special relief filed June 1,1993 by Evergreen Broadcasting Corp.;

" The 7 communities that lie beyond WTAJ-TV©s Grade B contour are Clarksburg, Clune, Iselin, Mclntyre, Saltsburg, West Lebanon, and Young Township.

19193 Federal Communications Commission DA 96-792 by WJAC, Incorporated; and by Gateway Communications, Inc. IS GRANTED to the extent indicated at paragraph 24, supra, and in all other respects IS DENIED. This change shall be effective with the following schedule: WWCP-TV and WJAC-TV shall notify the affected cable systems in writing of the stations© carriage and channel position elections (§§76.56, 76.57, and 76.64(f) of the Commission©s Rules) within 30 days of the release date of this Memorandum Opinion and Order. The affected cable systems shall come into compliance with the applicable rules within 60 days of the above notice.

FEDERAL COMMUNICATIONS COMMISSION

William H. Johnson Deputy Chief, Cable Services Bureau

19194