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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 ) ) TERRASTAR, INC. ) File No. 119-SAT-DR-96 ) Request for Declaratory Ruling to ) Clarify Section 25.104 of The Commission's) Rules Regarding Preemption of Local ) Zoning Restrictions of Satellite Earth ) Stations ) Adopted: July 2, 1997 Released: July 3, 1997 MEMORANDUM OPINION AND ORD ER By the Chief, International Bureau, INTRODUCTION 1. TerraStar Inc. (TerraStar) requests a declaratory ruling that its new satellite earth station design is covered by the Commission's rule limiting non-federal regulation of over-the-air reception devices (OTARD rule). By this order we deny TerraStar's request. We find that the OTARD rule and its underlying statutory authority is limited to specific types of antennas and does not encompass TerraStar's design. However, the issues presented by TerraStar's request are unique and involve advancements in satellite earth station technology. Accordingly, we will consider issuing a Notice of Proposed Rulemaking (NPRM), in the context of a future proceeding, requesting comment on whether similar protections to those available in the OTARD rule should be extended to antennas similar in design to TerraStar's. BACKGRO UND TerraStar Antenna 2. TerraStar is a manufacturer of C-band satellite earth stations designed for reception of Direct-To-Home (DTH) video programming. TerraStar asserts it has developed a new receive-only satellite earth station that allows consumers to receive C-band satellite signals using a small antenna system rather than the more typical large, single parabolic antenna. TerraStar's earth station uses three adjacent parabolic antennas positioned horizontally along a common support beam. Each dish is 0.53 meters (approximately 21 inches) in diameter with a total system length of 1.6 meters (approximately 5 feet). The earth station is a steerable system. Currently, the typical C-band antenna used for video reception is a single parabolic dish 2-3 meters (approximately 6-9 feet) in diameter. TerraStar intends to market its new antenna system in connection with a new C-band DTH multichannel video program distribution service, "StarVideo." 3. TerraStar asserts that its antenna design should be covered by our rules preempting certain local regulation of satellite earth stations and has requested a declaratory ruling to this effect. Two Commission rules address this issue: (1) 47 C.F.R.  25.104 (Section 25.104) titled, "Preemption of Local Zoning of earth stations" which covers all earth stations and applies to local governmental restrictions and (2) 47 C.F.R.  1.4000 (Section 1.4000) titled, "Restrictions impairing reception of television broadcast signals, direct broadcast satellite services or multichannel multipoint distribution services" (OTARD rule) which covers earth stations less than one meter in diameter and applies to both government and private restrictions. TerraStar requests a ruling that its antenna is covered by the later rule. 4. Section 25.104 was first adopted in 1986 in response to evidence that state and local governments were, in some instances, imposing unreasonably restrictive burdens on the installation of satellite earth station antennas. Subsequently, in the wake of consumer concerns and the U.S. Court of Appeals decision in Town of Deerfield v. FCC, the Commission concluded that its 1986 rule needed revision. As a result, the Commission issued a Notice of Proposed Rulemaking on May 15, 1995 (May 1995 NPRM), requesting comment on how the Commission could modify Section 25.104 to provide greater clarity for users, local governments and others. On February 1, 1996, subsequent to the May 1995 NPRM comment period but prior to the Commission issuing a final report and order in that proceeding, Congress passed the Telecommunications Act of 1996 (the 1996 Act). Section 207 of the 1996 Act addresses restrictions placed on DBS-type satellite earth stations. Section 207 states: Within 180 days after the date of enactment of this Act, the Commission shall, pursuant to section 303 of the Communications Act of 1934, promulgate regulations to prohibit restrictions that impair a viewer's ability to receive video programming services through devices designed for over-the-air reception of television broadcast signals, multichannel multipoint distribution service, or direct broadcast satellite services. While Section 25.104 applied to certain non-federal, governmental restrictions on earth stations, the language of Section 207 of the 1996 Act indicated that Congress intended the Commission to issue rules addressing, as well, non-governmental, private restrictions on DBS- type earth stations. 5. On March 11, 1996, one month following passage of the 1996 Act, the Commission issued a combined Report and Order and Further Notice of Proposed Rulemaking (March Order) revising Section 25.104 and implementing aspects of Section 207. The Commission tentatively concluded that this revised rule implemented Section 207 with respect to non-federal government restrictions but requested further comment on this conclusion. In addition, the FNPRM asked for comment on how to implement Congressional intent with respect to private restrictions such as deed covenants and homeowner association rules. 6. On August 6, 1996, after reviewing the comments solicited in the March Order and a similar NPRM regarding over-the-air antennas and multichannel multipoint distribution service (MMDS) antennas, the Commission elected to further revise its rules and adopted 47 C.F.R.  1.4000 (Section 1.4000) to apply to all antennas covered by Section 207. As currently written, Section 25.104 preempts any state or local zoning, land use, building or similar regulation which materially limits transmission or reception by satellite earth station antennas or imposes unreasonable costs on satellite earth stations larger than one meter in diameter. However, for antennas one meter or less in diameter, paragraph (f) of Section 25.104 refers to the newly created Section 1.4000, which addresses both non-federal governmental restrictions and private restrictions on earth stations designed to receive direct broadcast (DBS) or Direct-To-Home (DTH) satellite service. Section 1.4000 states in pertinent part: Any restriction . . . that impairs the installation, maintenance, or use of: (1) an antenna that is designed to receive direct broadcast satellite service, including direct-to-home satellite services, that is one meter or less in diameter or is located in Alaska; or (2) an antenna that is designed to receive video programming services via multipoint distribution services, including multichannel multipoint distribution services, instructional television fixed services, and local multipoint distribution services, and that is one meter or less in diameter or diagonal measurement; or (3) an antenna that is designed to receive television broadcast signals, is prohibited. . . . 7. In its original request, TerraStar sought a declaration that its new earth station lies within the meaning of the Commission's "one meter presumption rule." As explained above, on June 3, 1996, at the time of TerraStar's submission, the Commission's only rule limiting local regulation of earth stations was found in Section 25.104. At that time Section 25.104 stated, "Any state or local zoning, land-use, building, or similar regulation that affects the installation, maintenance, or use of: . . . a satellite earth station antenna that is one meter or less in diameter in any area, regardless of land use or zoning category shall be presumed unreasonable. . . ." 8. However, along with the August 6, 1996 modification of Section 25.104 and the adoption of Section 1.4000, the Commission also modified the presumption approach as it applies to antennas less than one meter. The current rules either prohibit or preempt certain restrictions that impair reception by DBS-type antennas one meter or less in diameter while allowing certain exceptions or reasonable regulations related to safety or historic preservation. TerraStar, noting this change in the rules, stated in a subsequent submission, "Inclusion of TerraStar's antenna system within the meaning of Sections 25.104(f) and Section 1.4000 of the Commission's [new] rules is consistent with the Commission's interpretation of its preemption authority under the Telecommunications Act of 1996." DISCUSS ION Section 1.4000(a)(1) 9. TerraStar asserts that, properly measured, its system falls within the OTARD rule and seeks a declaration to this effect. TerraStar states that the determination of how the OTARD rule is applied to this type of earth station could affect whether its earth station would be desirable for use in residential settings. TerraStar makes two arguments in support of its request. It states that each one-half meter parabolic antenna should be measured separately. Alternatively, TerraStar asserts that, if taken as a whole, the entire system is not parabolic and can not be measured according to diameter. It urges that the Commission use surface area as a more appropriate measure. A. Separate Measurement 10. The legislative history of the 1996 Act provides guidance on Congressional intent regarding the technology covered by Section 207. The House Report accompanying the 1996 Act states that the Direct Broadcast Satellite Service is a specific service limited to higher power DBS satellites and that the service does not include lower power C-band satellites, which require larger dishes in order for subscribers to receive signals. The Commission concluded that because Congress expressly excluded "larger" C-band satellite antennas, Congress's focus was on the size of the antenna. The Commission narrowly interpreted this language, specifically stating, "[W]e tentatively conclude[] Congress intended 'direct broadcast satellite service' to include not only services that are technically DBS, but also medium power Ku-Band DTH services, such as that offered by Primestar, because they use antennas one meter or less in diameter." 11. TerraStar asserts that each antenna in its earth station system should be measured separately and that the OTARD rule is not limited to the first antenna only. Thus, TerraStar argues that because each separate antenna measures approximately one half meter and our rule is not limited to the first antenna, each antenna in the system falls within the OTARD rule. Additionally, TerraStar supports its argument that the each antenna should be viewed separately through its technical submissions. The submissions indicate that a physical gap can be placed between the main central reflector and the two side reflectors without affecting performance. 12. We find that each antenna cannot be treated separately for the purposes of our OTARD rule. As presented visually and as described in its request, TerraStar's earth station is a integrated system comprised of three adjacent antennas affixed to a common support beam. In this configuration, the three antennas are physically mounted to form a single consolidated earth station. 13. TerraStar specifically states that "[e]ach dish antenna is part of the same antenna system . . . ." Additionally, TerraStar states that the antenna is a "[s]teerable system." The fact that the three antenna system is mounted on a common support beam linking the three antennas, and that the entire system is steerable, shows that the three antennas form a single earth station for the purposes of the OTARD rule. Therefore, because each antenna is part of a common system physically arranged as a single unit, the antennas form a single earth station which measures approximately .53 meters along the minor axis and approximately 1.6 meters along the major axis for the purposes of the OTARD rule. Under this approach, TerraStar's antenna design does not measure less than one meter in diameter and does not meet the OTARD rule definition. B. Use of Surface Area as Measurement 14. Alternatively, TerraStar argues that even taking its earth station system as a whole, using diameter as a measurement (as specified in the OTARD rule) is inappropriate because the earth station is not parabolic. TerraStar points out that its system is 1.6 meters in length but only 0.53 meters in height and that extrapolating an imaginary circle (diameter) around the two longest points is inappropriate. We find that TerraStar's argument actually supports our conclusion that TerraStar's antenna design does not fall within the meaning of the OTARD rule. 15. The text of Section 1.4000 (a)(1) specifically states that the rule applies to antennas, one meter or less in diameter. Additionally, the August Order discussing the rule and its statutory authority states that the OTARD rule applies to DBS-type services using antennas one meter or less in diameter. By definition, a diameter is a line passing through the center of a circle or sphere from one side to the other. In this case, TerraStar's earth station design is longer on one axis than the other. As a result, TerraStar's earth station configuration is not circular and thus can not be measured using diameter. Therefore, because the OTARD rule specifically uses the word "diameter," which applies to circular shapes, and because TerraStar's earth station is not circular, diameter is an inappropriate measurement. 16. TerraStar suggests that "[s]urface area, a measurement based upon diameter, is a more appropriate measure. . . ." Further, TerraStar asserts that because the total surface area of its three antenna earth station is less than the surface area of a traditional single parabolic antenna one meter in diameter, we should declare that its antenna falls within the OTARD rule. 17. While we agree that the combined area of TerraStar's earth station is less than the area of a one meter parabolic antenna, the OTARD rule is not based on the use of surface area as a method of determining antenna size. As described above, both the text of the rule and previous orders specifically state that DBS-type services using earth stations one meter or less in diameter fall within the OTARD rule. To find that TerraStar's antenna falls within the one meter preemption rule based upon surface area would entail use of a type of measurement (surface area) different from that in the rule. 18. The Commission has traditionally used the term diameter when evaluating and measuring antenna size. In adopting Sections 25.104 and 1.4000, the Commission did not contemplate using surface area as a form of antenna size measurement. Further, taken to its logical conclusion, using the surface area of a one meter antenna as a baseline measurement for DTH antennas could result in an antenna having the same surface area but shaped so that it is approximately four inches wide and twenty-five feet long. Preemption of restrictions on this type antenna using the OTARD rule would be inconsistent with Congress's intent that the rule apply to smaller DBS-type antennas. Expanding Section 1.4000 (a)(1) to include surface area as a measurement is more appropriately the subject of a rulemaking proceeding. Consequently, we find that TerraStar's antenna does not fall within Section 1.4000 because of its surface area. 19. It might be more appropriate to respond to Terrastar's petition by issuing a notice of proposed rulemaking. While the choice to proceed by general rule or ad hoc adjudication is one which primarily lies with the administrative agency, the function of formulating new standards of conduct should be performed, as much as possible, through quasi-legislative (rulemaking) functions. The rule-making procedure performs an important function in that it gives notice to an entire segment of society regarding the promulgation of general rules and allows affected persons to be heard. Public discussion through rulemaking allows agencies to be more responsive to the public needs. 20. Although TerraStar's antenna is not covered by the OTARD rule, the issues presented by TerraStar's request are unique and involve advancements in satellite earth station technology. Therefore, we will consider issuing a Notice of Proposed Rulemaking (NPRM) in a separate proceeding to request comment on whether similar protections to those found in the OTARD rule should be extended to the TerraStar antenna design. In such a NPRM we would solicit a more complete record by requesting comment on a variety of issues including alternative antenna measurement methods and the impact of advancements in antenna design on our preemption rules. Although, we decline here to declare that TerraStar's antenna falls within our current Section 1.4000 rule, this decision does not foreclose the possibility that similar rules may be adopted to include antenna designs such as TerraStar's, Section 25.104 21. Although the OTARD rule does not apply to TerraStar's antenna design, we note that Section 25.104, our rule governing local regulation of larger earth stations, does cover TerraStar's design. Under Section 25.104, non-federal, governmental restrictions which materially limit transmission or reception by satellite earth station antennas, or restrictions which impose more than minimal costs on users of such antennas, are preempted unless the promulgating authority can demonstrate that such regulation is reasonable. This Section applies to antennas larger than one meter. Additionally, we note that Section 25.104 applies to non-federal governmental regulation of satellite earth stations. However, the section does not apply to private, nongovernmental restrictions. CONCLUSION 22. Because TerraStar's earth station is a unified single system and because the system is linear in shape we will not declare that TerraStar's antenna lies within our OTARD rule. However, in light of the significant issues raised by TerraStar's request, we will consider instituting a Notice of Proposed Rulemaking in a forthcoming proceeding. ORDERING CLAUSES 23. Accordingly, pursuant to authority delegated by Sections 0.261 and 1.2 of the Commission's Rules, 47 C.F.R.  0.261 and 1.2, IT IS ORDERED that TerraStar, Inc.'s Request for Declaratory Ruling asking that its antenna design be covered by Section 1.4000, 47 C.F.R.  1.4000, IS DENIED. Peter F. Cowhey Chief, International Bureau