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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** FCC 97-64 Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 In the Matter of ) ) TBA, INC., ) TBA OF CLEVELAND, INC., and ) TBA OF BRATENAHL VILLAGE INC., ) Complainants, ) ) v. ) File No. E-90-394 ) THE OHIO BELL ) TELEPHONE COMPANY, ) Defendant. ) MEMORANDUM OPINION AND ORDER Adopted: February 20, 1997 Released: March 4, 1997 By the Commission: I. INTRODUCTION 1. We have before us an Application for Review filed by TBA, Inc., TBA of Cleveland, Inc., and TBA of Bratenahl Village, Inc. (collectively "TBA"). TBA asks the Commission to review an order issued by the Common Carrier Bureau (the "Bureau"). In that order, the Bureau denied TBA's complaint against The Ohio Bell Telephone Company ("Ohio Bell"). In its complaint, TBA alleged, inter alia, that Ohio Bell had violated Section 214 of the Communications Act of 1934, as amended ("the Act"). More specifically, the issue was "whether Ohio Bell has violated its existing Section 214 grant of authority" in connection with the construction, operation and extension of lines of a broadband cable television transport system. For the reasons set forth below, we deny TBA's Application for Review. II. BACKGROUND 2. In 1986, Ohio Bell entered into an agreement with a franchised cable television operator, North Coast Cable Ltd. ("NCC"), to build a broadband transmission facility to provide cable television service in Cleveland, Ohio. The facility was built by Ohio Bell pursuant to Section 214 certification and was completed in October 1990. The system consists of several hubs interconnected by optical fiber and a coaxial cable distribution network. After commencing service and pursuant to a provision in the agreement, NCC purchased the coaxial cable portion of the distribution system from Ohio Bell. Although record title remained with Ohio Bell, all other incidents of ownership were conveyed to NCC. Currently, Ohio Bell provides NCC with the broadband transmission facilities in accordance with FCC Tariff No. 43. 3. In June 1990, NCC extended a line of the coaxial portion of the system into the Village of Bratenahl ("Bratenahl"), a suburb of Cleveland, by tapping into the transport system at a utility pole located within the city limits of Cleveland. Thereafter, NCC began competing with complainant TBA of Bratenahl Village, Inc., which had been providing cable television service in that community since 1983. 4. On August 17, 1990, TBA filed a complaint alleging that Ohio Bell violated Section 214 of the Act by exceeding its existing Section 214 certification when it engaged in signal transmission beyond the city limits of Cleveland. Ohio Bell denied the allegations and moved to dismiss the complaint. After consideration of the record before it, the Bureau concluded that TBA had failed to establish a Section 214 violation by Ohio Bell, and therefore, denied TBA's complaint. TBA subsequently filed an Application for Review of the Bureau Order. III. CONTENTIONS OF THE PARTIES 5. In its application for review, TBA asserts that the Bureau erred in its interpretation of Section 214 as it applied to the issues raised in TBA's complaint. TBA contends that the Bureau erroneously concluded that, because Ohio Bell was not "actively involved" in extending the line into Bratenahl, Ohio Bell did not exceed the scope of its Section 214 authority. According to TBA, the Bureau's statement that "a common carrier did not extend the line, and Ohio Bell's knowledge does not by itself make it a participant in the line extension" implies that the Bureau interpreted Section 214 to require a common carrier's active participation in extending a line in order to violate Section 214 of the Act. TBA contends that the Bureau Order adopts an impermissibly narrow construction of Section 214 that fails to consider how the word "undertake" broadens the operation and scope of the statute. TBA argues that the Bureau's narrow interpretation of Section 214 diminishes the importance of evidence showing that Ohio Bell may have had advance knowledge of NCC's plans to extend NCC's lines across a freeway from Cleveland to adjoining Bratenahl, and that such advance knowledge constitutes a violation of the statute. TBA asserts that, by "reading into Section 214 a requirement that a common carrier actively 'participate' in the line extension, the Commission provides common carriers an avenue by which to escape their 214 certification obligation." Such an interpretation, TBA contends, undermines the purpose of the statutory provision and allows telephone companies to conspire with cable television operators to facilitate the provision of cable service in violation of Section 214. 6. TBA also contends that the Bureau incorrectly interpreted Section 214, and instead should have concluded that Ohio Bell violated Section 214 by transmitting signals into Bratenahl. TBA argues that section 214 does not provide that common carriers shall not engage in service delivery, or signal origination. TBA argues that the statutory prohibitions concern transmissions, and that the Order impermissibly equates signal origination with signal transmission. TBA contends that "[b]y including signal origination as a requirement of Section 214, the Commission adopts and utilizes an unworkable definition of signal transmission, expands the scope of the statute and renders it meaningless." 7. Finally, TBA claims that the Bureau made an erroneous finding as to an important question of fact. Specifically, TBA contends that the statement contained in the Order that the signals and the entire cable service are exclusively controlled by North Coast Cable and not Ohio Bell is inaccurate and a factual misstatement. TBA contends that Ohio Bell should be held responsible for the transmission in question because the signal being delivered to the Village of Bratenahl is a signal that is transmitted through the Hub/Interconnect Network by way of Ohio Bell's Hub 3 in Cleveland. Thus, TBA contends that Ohio Bell is violating its Section 214 authority. 8. In opposition, Ohio Bell contends that it did not extend or construct lines beyond the limits of its authority under Section 214, nor did it engage in statutorily impermissible signal transmission. Ohio Bell argues that the Bureau accurately construed and interpreted the record, as well as Section 214, and properly held, on the basis of the record and the law, that TBA did not satisfy its burden of proving that Ohio Bell exceeded the authority of its Section 214 certification. IV. DISCUSSION 9. We have reviewed the record in this proceeding and find no reason to reverse the Bureau's decision. We conclude that the Bureau correctly found that TBA had not satisfied its burden of proving that Ohio Bell had exceeded the authority of its Section 214 certification. We also conclude that TBA offers no compelling evidence in its Application for Review that persuades us to alter the Bureau Order. 10. Section 214 requires that, No carrier shall undertake the construction of a new line or of an extension of any line, or shall acquire or operate any line, or extension thereof, or shall engage in transmission over or by means of such additional or extended line, unless and until there shall first have been obtained from the Commission a certificate that the present or future public convenience and necessity require or will require the construction, or operation, or construction and operation, of such addition or extended line . . . . In its Application for Review, TBA appears to suggest that the phrase "no carrier shall undertake the construction" means that no common carrier can have any involvement in any aspect of the construction or the provision of service, including having prior knowledge of a planned extension of a line it did not own or control. Under the facts of this case, we agree with the Bureau's decision. First, the Bureau Order properly relied on the parties' acknowledgement that NCC, a cable television operator, not Ohio Bell, extended the coaxial line in question into Bratenahl. 11. Second, we also find that the Bureau gave appropriate consideration to an Ohio Bell employee's deposition regarding that employee's alleged advance knowledge of NCC's plans to extend NCC's coaxial cable line. The Bureau Order acknowledged that Ohio Bell may have had prior knowledge that NCC intended to extend its coaxial cable line to Bratenahl. An Ohio Bell employee "gave North Coast public record information as to which department of state in Ohio one should go to to apply for a permit to interrupt traffic on a highway for the purpose of stringing cable across that highway." That the employee may have provided NCC public information does not, by itself, mean that Ohio Bell participated in NCC's line extension, nor does it demonstrate that Ohio Bell acted beyond the scope of its Section 214 authority. Therefore, we affirm the Bureau's finding that Ohio Bell did not undertake construction beyond its certificated authority. 12. We agree with the Bureau's rejection of TBA's argument that Ohio Bell has exceeded its existing Section 214 authorization by engaging in signal transmission into Bratenahl. TBA appears to argue that NCC's use of Ohio Bell's physical facilities, namely Ohio Bell Hub No. 3 in Cleveland, constitutes a transmission by Ohio Bell. We disagree. First, signal transmission cannot be properly analyzed unless the signal origination, control and destination are analyzed and understood. TBA is incorrect when it argues that such factors are irrelevant. Such information is needed to determine the exact nature of such transmissions. All parties to this dispute agree that no transmissions originate within Ohio Bell's Hub/Interconnect Network, including Hub No. 3. "Signals received or generated by North Coast Cable at its headend are transmitted through the hubbing sites of the Hub Interconnect Network located in Ohio Bell central offices . . . ." "At the hubbing sites optical or other signals are demodulated into RF signals and are connected to the coaxial Subscriber and/or Institutional Networks." Ohio Bell does not control the transmitted signals or the destination of the transmitted signals. Its hubs simply process incoming transmissions and pass those signals on to their unique destinations. Therefore, the Bureau correctly determined that it is North Coast Cable, not Ohio Bell, that transmits signals into Bratenahl. The signal originates with NCC at its facilities. NCC has total control over its signal through its coaxial cable network and through exclusive rights to use Ohio Bell's Hub Interconnect Network. Ultimately, only NCC determines the destination of each signal transmission. We find that Ohio Bell has not exceeded its existing Section 214 certification by engaging in transmission over its extended lines because it neither extended a line into Bratenahl nor engaged in signal transmission to that location. V. CONCLUSION 13. In this Order, we conclude that the Bureau properly denied TBA's complaint. We further conclude that TBA has provided no new persuasive arguments to establish a Section 214 violation by Ohio Bell. Therefore, we affirm the Bureau's decision and deny TBA's Application for Review. VI. ORDERING CLAUSE 14. Accordingly, IT IS ORDERED, pursuant to Sections 4(i), 4(j), 5(c)(5), and 208 of the Communications Act of 1934, as amended, 47 U.S.C.  154(i), 154(j), 155(c)(5), 208, and Section 1.115(g) of the Commission's rules, 47 C.F.R.  1.115(g), that the Application for Review filed by TBA, Inc., TBA of Cleveland, Inc., and TBA of Bratenahl Village, Inc. IS DENIED. FEDERAL COMMUNICATIONS COMMISSION William F. Caton Acting Secretary