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Comcast Cable Communications Effective Competition Petitions

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Released: December 17, 2013

Federal Communications Commission

DA 13-2401

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
MB Docket No. 12-111, CSR 8621-E
)
MB Docket No. 12-112, CSR 8622-E
Comcast Cable Communications, LLC
)
MB Docket No. 12-124, CSR 8627-E
)
MB Docket No. 12-125, CSR 8628-E
Petitions for Determination of Effective
)
MB Docket No. 12-127, CSR 8629-E
Competition in 39 California Communities
)
MB Docket No.12-128, CSR 8630-E

MEMORANDUM OPINION AND ORDER

Adopted: December 13, 2013

Released: December 17, 2013
By the Senior Deputy Chief, Policy Division, Media Bureau:

I.

INTRODUCTION AND BACKGROUND

1.
Comcast Cable Communications, LLC, on behalf of its subsidiaries and affiliates,
hereinafter referred to as “Petitioner,” has filed with the Commission a petition pursuant to Sections 76.7,
76.905(b)(2), and 76.907 of the Commission’s rules for a determination that Petitioner is subject to
effective competition in those communities listed on Attachment A and hereinafter referred to as the
“Attachment A Communities.” Petitioner alleges that its cable systems serving the Attachment A
Communities are subject to effective competition pursuant to Section 623(l)(1)(B) of the
Communications Act of 1934, as amended (“Communications Act”),1 and the Commission’s
implementing rules,2 and are therefore exempt from cable rate regulation in those Communities because
of the competing service provided by two direct broadcast satellite (“DBS”) providers, DIRECTV, Inc.
(“DIRECTV”), and DISH Network (“DISH”), and, in 29 Attachment A Communities, AT&T.3 (The
DBS providers and AT&T will be collectively referred to as the “Competing Providers.”) Petitioner
additionally claims to be exempt from cable rate regulation in the community listed on Attachment B and
hereinafter referred to as the “Attachment B Community,” pursuant to Section 623(l)(1)(A) of the
Communications Act4 and Section 76.905(b)(1) of the Commission’s rules,5 because the Petitioner serves
fewer than 30 percent of the households in the franchise area. The petitions are unopposed.
2.
In the absence of a demonstration to the contrary, cable systems are presumed not to be
subject to effective competition,6 as that term is defined by Section 623(l) of the Communications Act and
Section 76.905 of the Commission’s rules.7 The cable operator bears the burden of rebutting the
presumption that effective competition does not exist with evidence that effective competition is present
within the relevant franchise area.8 For the reasons set forth below, we grant the petitions based on our


1 See 47 U.S.C. § 543(l)(1)(B).
2 47 C.F.R. § 76.905(b)(2).
3 The Attachment A Communities in which AT&T is a competing provider are all the Communities in CSRs 8621-
E, 8627-E, and 8729-E; in CSR 8622-E, Cotati, Petaluma, Rohnert Park, Santa Rosa, Sebastopol, and Windsor; and,
in 8630-E, Del Ray Oaks, Marina, Monterey, Pacific Grove, Salinas, and Seaside.
4 See 47 U.S.C. § 543(l)(1)(A).
5 47 C.F.R. § 76.905(b)(1).
6 47 C.F.R. § 76.906.
7 See 47 U.S.C. § 543(l); 47 C.F.R. § 76.905.
8 See 47 C.F.R. §§ 76.906-.907(b).

Federal Communications Commission

DA 13-2401

finding that Petitioner is subject to effective competition in the Communities listed on Attachments A and
B.

II.

DISCUSSION

A.

The Competing Provider Test

3.
Section 623(l)(1)(B) of the Communications Act provides that a cable operator is subject
to effective competition if the franchise area is (a) served by at least two unaffiliated multi-channel video
programming distributors (“MVPDs”) each of which offers comparable video programming to at least 50
percent of the households in the franchise area; and (b) the number of households subscribing to
programming services offered by MVPDs other than the largest MVPD exceeds 15 percent of the
households in the franchise area.9 This test is referred to as the “competing provider” test.
4.
The first prong of this test has three elements: the franchise area must be “served by” at
least two unaffiliated MVPDs who offer “comparable programming” to at least “50 percent” of the
households in the franchise area.10 It is undisputed that the Attachment A Communities are “served by”
both DBS providers, DIRECTV and DISH, and that these two MVPD providers are unaffiliated with
Petitioner or with each other. A franchise area is considered “served by” an MVPD if that MVPD’s
service is both technically and actually available in the franchise area. DBS service is presumed to be
technically available due to its nationwide satellite footprint, and presumed to be actually available if
households in the franchise area are made reasonably aware of the service's availability.11 The
Commission has held that a party may use evidence of penetration rates in the franchise area (the second
prong of the competing provider test discussed below) coupled with the ubiquity of DBS services to show
that consumers are reasonably aware of the availability of DBS service.12 We further find that Petitioner
has provided sufficient evidence to support its assertion that potential customers in those Communities
are reasonably aware that they may purchase the service of these MVPD providers.13 The “comparable
programming” element is met if a competing MVPD provider offers at least 12 channels of video
programming, including at least one channel of nonbroadcast service programming,14 and is supported in
these petitions with copies of channel lineups for both DIRECTV and DISH.15 Also undisputed is
Petitioner’s assertion that both DIRECTV and DISH offer service to at least “50 percent” of the
households in the Attachment A Communities because of their national satellite footprint.16 Accordingly,
we find that the first prong of the competing provider test is satisfied.
5.
The second prong of the competing provider test requires that the number of households
subscribing to MVPDs, other than the largest MVPD, exceed 15 percent of the households in a franchise
area. Petitioner asserts that it is the largest MVPD in most of the Attachment A Communities;17 in four
other Attachment A Communities, Petitioner asserts that it uncertain which is the largest MVPD because


9 47 U.S.C. § 543(l)(1)(B); 47 C.F.R. § 76.905(b)(2).
10 47 U.S.C. § 543(l)(1)(B)(i); 47 C.F.R. § 76.905(b)(2)(i).
11 See, e.g., Petition in CSR 8621-E at 3.
12 Mediacom Illinois LLC, 21 FCC Rcd 1175, 1176, ¶ 3 (2006).
13 47 C.F.R. § 76.905(e)(2).
14 See 47 C.F.R. § 76.905(g); see also, e.g., Petition in CSR 8622-E at 5.
15 See, e.g., Petition in CSR 8627-E at Ex. 2.
16 See, e.g., Petition in CSR 8628-E at 3.
17 See, e.g., Petition in CSR 8629-E at 8.
2

Federal Communications Commission

DA 13-2401

both it and the Competing Providers have a household share of over 15 percent.18 The Commission has
recognized that, in that event, it is clear that MVPDs other than the largest one have a combined
household share in excess of 15 percent.19 Petitioner sought to determine the DBS provider penetration
there by purchasing a subscriber tracking report from the Satellite Broadcasting and Communications
Association that identified the number of subscribers attributable to the DBS providers within the
Attachment A Communities on a zip code plus four basis.20 Petitioner obtained AT&T subscriber
numbers directly from that company.21 AT&T requested that its subscriber numbers be kept
confidential.22 We will accede to that request in this proceeding by combining subscribership figures for
AT&T and the DBS providers. In providing the aggregate number of competing provider subscribers, we
are thereby safeguarding AT&T’s request for confidentiality.23
6.
Based upon the aggregate subscriber penetration levels that were calculated using Census
2010 household data,24 as reflected in Attachment A, we find that Petitioner has demonstrated that the
number of households subscribing to programming services offered by MVPDs, other than the largest
MVPD, exceeds 15 percent of the households in the Attachment A Communities. Therefore, the second
prong of the competing provider test is satisfied for each of the Attachment A Communities. Based on
the foregoing, we conclude that Petitioner has submitted sufficient evidence demonstrating that both
prongs of the competing provider test are satisfied and Petitioner is subject to effective competition in the
Attachment A Communities.

B.

The Low Penetration Test

7.
Section 623(l)(1)(A) of the Communications Act provides that a cable operator is subject
to effective competition if the Petitioner serves fewer than 30 percent of the households in the franchise
area. This test is referred to as the “low penetration” test.25 Petitioner alleges that it is subject to effective
competition under the low penetration effective competition test because it serves less that 30 percent of
the households in the Attachment B Community.
8.
Based upon the subscriber penetration level calculated by Petitioner, as reflected in
Attachment B, we find that Petitioner has demonstrated that the percentage of households subscribing to
its cable service is less than 30 percent of the households in the Attachment B Community. Therefore, the
low penetration test is satisfied as to the Attachment B Community.


18 Petition in CSR 8627-E at 8; Petition in CSR 8628-E at 7. The Communities in which Petitioner is unsure which
MVPD is the largest are, in CSR 8627-E, Galt; and, in CSR 8628-E, Corning, Gridley, and Orland.
19 If Petitioner is the largest MVPD, then MVPDs other than the largest one are the Competing Provider providers,
which have a combined share of over 15%. On the other hand, if one of the Competing Providers is the largest
MVPD, then Petitioner (which alone has over 15%) and the other Competing Providers combined have over 15%.
See, e.g., Comcast Cable Commc'ns, LLC, 26 FCC Rcd 10967, 10968-69, ¶ 5 (2011); Comcast Cable Commc'ns,
LLC
, 26 FCC Rcd 4901, 4903, ¶ 5 (2011); Time Warner Cable Inc., 25 FCC Rcd 14422, 14424, ¶ 6 (2010).
20 See, e.g., Petition in CSR 8630-E at 7-8.
21 See, e.g., Petition in CSR 8621-E at 6 n.24.
22 See, e.g., Petition in CSR 8622-E at Ex. 5.
23 We reserve the right to exercise our discretion to require more disclosure in future decisions.
24 See, e.g., Petition in CSR 8627-E at Ex. 8.
25 47 U.S.C. § 543(l)(1)(A).
3

Federal Communications Commission

DA 13-2401

III.

ORDERING CLAUSES

9.
Accordingly,

IT IS ORDERED

that the petitions for a determination of effective
competition filed in the captioned proceeding by Comcast Cable Communications, LLC, on behalf of its
subsidiaries and affiliates,

ARE GRANTED

.
10.

IT IS FURTHER ORDERED

that the certification to regulate basic cable service rates
granted to any of the Communities set forth on Attachments A and B

IS REVOKED

.
11.
This action is taken pursuant to delegated authority pursuant to Section 0.283 of the
Commission’s rules.26
FEDERAL COMMUNICATIONS COMMISSION
Steven A. Broeckaert
Senior Deputy Chief, Policy Division, Media Bureau


26 47 C.F.R. § 0.283.
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Federal Communications Commission

DA 13-2401

ATTACHMENT A

MB Docket No. 12-111, CSR 8621-E
MB Docket No. 12-112, CSR 8622-E
MB Docket No. 12-124, CSR 8627-E
MB Docket No. 12-125, CSR 8628-E
MB Docket No. 12-127, CSR 8629-E
MB Docket No. 12-128, CSR 8630-E

COMMUNITIES SERVED BY SUBSIDIARIES AND AFFILIATES OF

COMCAST CABLE COMMUNICATIONS, LLC


2010 Census

Estimated Competing

Communities

CUIDs CPR*

Households

Provider Subscribers

MB Docket No. 12-111, CSR 8621-E

Clayton
CA0061
29.08
4,006
1,165
Concord
CA0063
24.56
44,278
10,876
Danville
CA0288
41.67
15,420
6,425
Lafayette
CA0239
20.78
9,223
1,917
Martinez
CA0241
32.48
14,287
4,640
Moraga
CA0292
17.50
5,570
975
Pleasant Hill
CA0244
26.40
13,708
3,619

MB Docket No. 12-112, CSR 8622-E

Cloverdale
CA0110
33.06
3,182
1,052
Cotati
CA0306
26.60
2,978
792
Healdsburg
CA0111
22.02
4,378
964
Petaluma
CA0358
28.02
21,737
6,091
Rohnert Park
CA0318
29.19
15,808
4,614
Santa Rosa
CA0255
35.94
63,590
22,855
CA1612
Sebastopol
CA0324
22.86
3,276
749
Windsor
CA1513
36.34
8,970
3,260

MB Docket No. 12-124, CSR 8627-E

Citrus Heights
CA1551
31.95
32,686
10,442
Davis
CA1058
21.22
24,873
5,279
Folsom
CA1092
47.32
24,951
11,807
Galt
CA1087
48.66
7,262
3,534
Roseville
CA0163
29.99
45,059
13,512

MB Docket No. 12-125, CSR 8628-E

Chico
CA0234
25.90
34,805
9,015
Corning
CA0266
47.57
2,630
1,251
Gridley
CA0718
49.06
2,183
1,071
Orland
CA0269
53.12
2,515
1,336
Oroville
CA0196
29.70
5,646
1,677
Paradise
CA0512
26.90
11,893
3,199
5

Federal Communications Commission

DA 13-2401

2010 Census

Estimated Competing

Communities

CUIDs CPR*

Households

Provider Subscribers

MB Docket No. 12-127, CSR 8629-E

Benicia
CA0015
35.68
10,686
3,813
Fairfield
CA0459
30.95
34,484
10,673
Suisun City
CA0479
33.11
8,918
2,953
Vacaville
CA0349
37.98
31,092
11,809
Vallejo
CA0388
34.92
40,559
14,163

MB Docket No. 12-128, CSR 8630-E

Del Rey Oaks
CA0029
29.10
701
204
Marina
CA0033
36.67
6,845
2,510
Monterey
CA0174
22.25
12,184
2,711
Pacific Grove
CA0036
26.18
7,020
1,838
Salinas
CA0039
41.13
40,387
16,611
Sand City
CA1195
17.97
128
23
Seaside
CA0042
39.43
10,093
3,980

*CPR = Percent of competitive penetration rate.
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Federal Communications Commission

DA 13-2401

ATTACHMENT B

MB Docket No. 12-125, CSR 8628-E

COMMUNITY SERVED BY A SUBSIDIARY OR AFFILIATE OF

COMCAST CABLE COMMUNICATIONS, LLC

Franchise Area

Cable

Penetration

Community

CUID

Households

Subscribers

Percentage

Willows
CA0046
2,173
87
4.0
7

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