Before the V

Federal Communications Commission DA 99-939

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

In the Matter of: ) ) SAH Acquisition Corporation II ) ) CSR-5357-M v. ) ) Horizon Cable TV, Inc. ) ) Request For Mandatory Carriage )

MEMORANDUM OPINION AND ORDER

Adopted: May 17, 1999 Released: May 19, 1999

By the Chief, Consumer Protection and Competition Division, Cable Services Bureau:

I. INTRODUCTION

1. SAH Acquisition Corporation II, a wholly owned subsidiary of Shop At Home, Inc. and licensee of commercial television station KCNS-TV, Sari Francisco, California ("KCNS"), has filed a request for mandatory carriage of its signal on the cable systems operated by Horizon Cable TV, Inc. ("Horizon") in the communities served by Horizon's headends in Inverness, Novato, and Stinson Beach, California (the "Communities"). Horizon did not file an opposition.

II. BACKGROUND

2. Pursuant to Section 614 of the Communications Act and implementing rules adopted by the Commission in Implementation ofthe Cable Television Consumer Protection and Competition Act of 1992, Report and Order ("Must Carry Order''), commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the station's market.1 A station's market for this purpose is its "area of dominant influence," or ADI, as defined by the Arbitron audience research

18 FCC Red 2965, 2976-2977 (1993).

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organization.2 An ADI is a geographic market designation that defines each television market exclusive of others, based on measured viewing patterns.

3. Under the Commission's must-carry rules, cable operators have the burden of showing that a commercial station that is located in the same television market is not entitled to carriage.3 One method of doing so is for a cable operator to establish that a subject television station's signal, which would otherwise be entitled to carriage, does not provide a good quality signal to a cable system's principal headend.4 Should a station fail to provide the requisite over-the-air signal quality to a· cable system's principal headend, it still may obtain carriage rights because under our rules a station may provide a cable operator with specialized equipment, at the station's expense, which will improve the station's signal to an acceptable quality at a cable system's principal headend.5

ID. ALLEGATIONS OF THE PARTIES

4. KCNS states that it is a qualified local commercial television station assigned to the San Francisco ADl.6 KCNS asserts that the Communities served by Horizon are also located in the San Francisco ADI.7 KCNS further states that, by letters dated October 5, 1999, it requested mandatory carriage on Horizon's cable systems serving the Communities and assured Horizon that it "will purchase the requisite equipment necessary to ensure delivery of a good quality signal. "8 KCNS maintains that Horizon failed to respond to the letters dated October 5, 1999 and, as a result, KCNS sent a second set

2Section 614(h)(l)(C) of the Communications Act, as amended by the Telecommunications Act of 1996, provides that a station's market shall be determined by the Commission by regulation or order using, where available, commercial publications which delineate television markets based on viewing patterns. See41 U.S.C. §534(h)(l)(C). Section 76.55(e) of the Commission's rules provides that the ADis to be used to implement the mandatory carriage rules are those published in Arbitron's 1991-1992 Television Market Guide. The Commission recently concluded that it was appropriate to switch market definitions from ADls to Nielsen Media Research's designated market areas ("DMAs") for must-carry/retransmission consent elections. However, the Commission continued use Arbitron's 1991- 1992 Television ADJ Market Guide market designations for the 1996 election period and postponed the switch to Nielsen's DMAs until the must-carry/retransmission consent election that is to take place on October I, 1999. The Commission also proposed further rulemaking, solicited additional information, and provided parties opportunity to further consider issues relating to the transition to market designations based on Nielsen's DMAs. See Definition ofMarkets for Purposes ofthe Cable Television Mandatory Television Broadcast Signal Carriage Rules, Report and Order and Further Notice of Proposed Rule Making, 11 FCC Red 620 l (1996) ("Market Modification Report and Order'~.

3Must Carry Order, 8 FCC Red at 2990.

447 C.F.R. §76.55(c)(3).

5Must Carry Order, 8 FCC Red at 2991.

6Petition at 3.

1ld. at 4.

8ld. at 2 and Exhibit 2.

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ofletters, dated November 11, 1999.9 KCNS has yet to receive a response to any of its ietters requesting mandatory carriage on Horizon's systems.

IV. DISCUSSION

5. We grant KCNS' carriage complaint against Horizon. Section 614(a) of the Communications Act states that each cable operator shall carry the signals of local commercial television stations. A local commercial television station is defined as any full power broadcast television station that is within the same television market as the cable system. 10 It is undisputed that KCNS and Horizon are loc.ated within the same ADI. A cable operator is required to carry the signals of a local commercial television station unless that station fails to deliver a good quality signal to the cable system's principal headend; the station's signal substantially duplicates the signal of another local commercial station which is carried on the system; or the cable operator (with a system of more than 12 usable activated channels) has already allocated up to one-third of the aggregate number of its usable activated channels to other local commercial stations. 11 The Commission's rules also require a local commercial station that believes that a cable operator has failed to meet its carriage obligations to complain in writing to the cable operator. 12 The cable operator must respond in writing to the television station's complaint within 30 days of receipt and must either commence carriage of the signal or explain its reasons for failing to so do. 13 If the Commission determines that a cable operator has failed to meet its must-carry obligations, it may order an operator to commence carriage of the station in question. The record indicates that Horizon failed to respond to KCNS' request for mandatory carriage within 30 days of receipt of such request. There is no evidence in the record to indicate that KCNS is not entitled to carriage on Horizon's cable systems served by its Inverness, Novato, and Stinson Beach headends. We therefore order Horizon to commence carriage of KCNS' signal on its cable systems serving the Communities.

V. ORDERING CLAUSES

6. Accordingly, IT IS ORDERED that, pursuant to Section 614 of the Communications Act of 1934, as amended, 47 U.S.C. § 534, and Section 76.61(a)(2) of the Commission's rules, 47 C.F.R. § 76.61(a)(2), the Petition for Special Relief [CSR-5357-M] filed by SAH Acquisition Corporation II against Horizon Cable TV, Inc. IS GRANTED. --

9Id. at 3.

1047 U.S.C. § 534(h)(l)(A).

llSee Implementation of the Cable Television Consumer Protection and Competition Act of 1992, Broadcast Signal Carriage Issues, Clarification Order, 8 FCC Red 4142 (1993).

1247 C.F.R. § 76.6l(a)(2).

13Id. If a refusal of carriage is based upon the station's distance from the cable system's principal headend, the operator's response must include the location of the cable system's headend. If a cable operator denies carriage on the basis of the failure of the station to deliver a good quality signal at the cable system's principal headend, the operator must provide a list of equipment used to make the measurements, the point of measurement, and a list of the reception and over-the-air signal processing equipment used. Id.

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7. IT IS FURTHER ORDERED that Horizon SHALL COMMENCE CARRIAGE of the signal KCNS-TV within sixty (60) days from the release date of this Order on its cable systems served by its Inverness, Novato, and Stinson Beach principal headends.

8. This action is taken pursuant to authority delegated by Section 0.321 of the Commission's rules, 47 C.F.R. § 0.321.

FEDERAL COMMUNICATIONS COMMISSION

Deborah E. Klein, Chief Consumer Protection and Competition Division Cable Services Bureau

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