******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) PANHANDLE TELECASTING CO. CSR-4825-A) ) For Modification of the ADI of ) Station KFDA-TV ) MEMORANDUM OPINION AND ORDER Adopted: January 14, 1997 Released: January 22, 1997 By the Deputy Chief, Cable Services Bureau: INTRODUCTION 1. Panhandle Telecasting Co. ["KFDA-TV"], licensee of Station KFDA-TV (CBS, Channel 10), Amarillo, Texas, has filed the captioned petition which seeks to include the communities of Portales, New Mexico, and surrounding unincorporated areas of Roosevelt County, New Mexico in the "area of dominant influence" of Station KFDA-TV. The station's petition is unopposed. 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, a commercial television broadcast station is entitled to assert mandatory carriage rights on cable systems located within the 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. 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. 3. Under the Act, however, the Commission is also directed to consider changes in market areas. Section 614(h)(1)(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; (III) 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 (IV) evidence of viewing patterns in cable and noncable households within the areas served by the cable system or systems in such community. 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. 5. The Commission provided guidance in its Report and Order in MM Docket No. 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 surveys may need to be supplemented with additional data concerning viewing in cable homes. 6. In adopting rules to implement this provision, the Commission indicated that requested changes 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. 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 ADI change request. MARKET FACTS AND PETITIONER'S ARGUMENTS 7. Portales is the county seat of Roosevelt County, New Mexico, and contains nearly two thirds of the county's population. Roosevelt County is located adjacent to the southwestern corner of the Amarillo ADI, and at the eastern edge of the Albuquerque, New Mexico ADI. Portales is located approximately 108 miles from Amarillo. 8. KFDA-TV states that it has not always been assigned to the Albuquerque ADI, and that Arbitron has assigned the station at various times to the Amarillo, Texas and Lubbock, Texas ADIs. KFDA-TV notes, citing the Reconsideration of the Cable Television Report and Order, that as early as 1972 the station was significantly viewed in Roosevelt County, via KFDA-TV's then-owned satellite station in Clovis, New Mexico, a community just north of Roosevelt County. According to KFDA-TV, ownership of KFDA-TV and the satellite station separated in 1976, but the satellite station continued to rebroadcast significant amounts of KFDA-TV's programming until 1979. KFDA-TV states that its signal was carried on the cable system serving Portales and Roosevelt County during most of the 1970s, and that carriage resumed in 1993 pursuant to a retransmission consent agreement with Century New Mexico Cable TV Corp., the current system operator. KFDA- TV states that it provides extensive weather, news, and sports coverage to eastern New Mexico. KFDA-TV details the weather equipment and severe weather warning procedures it provides to Portales and eastern New Mexico. In addition, KFDA-TV submits both a list of 176 news items it has aired since September 1993 of relevance and interest to eastern New Mexico in general and to Portales and Roosevelt County in particular, and also a list of 236 sports reports of local Portales teams aired from late August 1993 to February 1996. KFDA-TV acknowledges that other stations provide coverage and local programming for Portales and Roosevelt County, but argues that this does not bar the station's claim to include these communities in the station's ADI, citing VSC Communications, Inc. To demonstrate area viewing patterns, KFDA-TV submits Nielsen audience data for Roosevelt County from 1994, 1995, and 1996. KFDA-TV notes that this data shows that the station achieved a total share of viewing in Roosevelt County in 1994 of 6 (a 10 share in noncable homes and a 3 share in cable homes); a total share in 1995 of 9 (a 14 share in noncable homes and a 6 share in cable homes); and a total share in 1996 of 10 (a 19 share in noncable homes and a 6 share in cable homes). In addition, KFDA-TV states that Nielsen's 1995 and 1996 studies have reassigned Roosevelt County from the Albuquerque DMA to the Amarillo DMA. KFDA-TV argues, citing the Report and Order and Further Notice of Proposed Rulemaking in CS Docket 95- 178 and KTEN Television Limited Partnership, that this supports KFDA-TV's request to include Portales and Roosevelt County within the station's ADI. ANALYSIS AND DECISION 9. We shall grant KFDA-TV's petition for market modification. The evidence the station submits, evaluated pursuant to the four statutory and other relevant factors, persuades us that Portales and Roosevelt County, New Mexico are properly considered part of the station's ADI. With regard to the first statutory factor, we note that KFDA-TV has demonstrated a history of carriage on the cable systems serving the communities in question. We note that this includes a significant period of carriage pursuant to retransmission consent, during a time in which KFDA-TV could not elect mandatory carriage. A pattern of carriage, in the absence of a carriage obligation, is a strong indication of interest in a signal and of the signal's market connection to the communities in question. Turning to the second statutory factor, we note that although KFDA-TV does not place a Grade B contour over Portales or Roosevelt County, the station has demonstrated through three years of program logs and a description of its weather features that the station does provide coverage and other local service to the communities. With regard to the third statutory factor -- whether other stations eligible to be carried serve the communities in question -- 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 KFDA-TV concedes that Albuquerque ADI stations do serve the communities in question to varying extents, this enhancement factor would not appear to be applicable. 10. Turning to the fourth factor, that of area viewing patterns, the Nielsen data which KFDA-TV submits indicates that the station has a share of viewing in Roosevelt County that demonstrates a clear and substantial nexus between Roosevelt County and the Amarillo ADI. In fact, KFDA-TV's most recent audience shares in Roosevelt County exceed those of all but one Albuquerque ADI commercial licensee reported by Nielsen. KFDA-TV achieves a 10 total share in Roosevelt County (a 19 share in noncable households and a 6 share in cable households), and a 73 total cume (67 in noncable households). In contrast, Station KBIM-TV (CBS, Channel 10), Roswell, New Mexico garners a 7 total share in Roosevelt County (an 8 share in noncable households and a 6 share in cable households), and a 69 total cume (43 in noncable households). Station KOB-TV (NBC, Channel 4), Albuquerque, New Mexico has less than a 0.5 total share (a 1 share in noncable households and less than a 0.5 share in cable households), and a 7 total cume (14 in noncable households). Station KOBR (NBC, Channel 8), Roswell, New Mexico achieves a 16 total share in Roosevelt County (a 7 share in noncable households and a 19 share in cable households), and a 64 total cume (47 in noncable households). While KOBR's total share in Roosevelt County is higher than that of KFDA- TV, KFDA-TV's off-air viewing exceeds that of KOBR, as does KFDA-TV's cume. 11. Finally, we note that Nielsen currently assigns Roosevelt County to the Amarillo, Texas DMA. We recognize that the 1991-92 Arbitron ADI designations remain the basis for 1996 carriage elections. Nevertheless, the Commission has invited parties to include information as to DMA assignments in market modification proceedings because it may provide additional information as to the scope of the markets involved. We believe, in view of the totality of the circumstances of the present case, that Nielsen's DMA market assignment of Roosevelt County, while it cannot by itself be determinative, is persuasive evidence that the communities in question have a sufficient nexus with KFDA-TV to be considered to be part of its market. ORDERING CLAUSES 12. Accordingly, IT IS ORDERED, pursuant to 614(h) 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 petition for special relief (CSR-4825-A) filed September 11, 1996 by Panhandle Telecasting Co. IS GRANTED. 13. This action is taken pursuant to authority delegated by 0.321 of the Commission's Rules. FEDERAL COMMUNICATIONS COMMISSION William H. Johnson Deputy Chief, Cable Services Bureau