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Media Bureau Granted Petition Filed By Comcast Cable Communications

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Released: May 1, 2013

Federal Communications Commission

DA 13-960

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

Comcast Cable Communications, LLC
)
MB Docket No. 12-103, CSR 8620-E
)
Petition for Determination of Effective
)
Competition in Five California Communities
)

MEMORANDUM OPINION AND ORDER

Adopted: April 29, 2013

Released: May 1, 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
“Communities.” Petitioner alleges that its cable system serving the Communities is 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 is therefore exempt from
cable rate regulation in the Communities because of the competing service provided by two direct
broadcast satellite (“DBS”) providers (DIRECTV, Inc. (“DIRECTV”), and DISH Network (“DISH”))
and, in three Communities, AT&T.3 The petition is unopposed.
2.
In the absence of a demonstration to the contrary, cable systems are presumed not to be
subject to effective competition,4 as that term is defined by Section 623(l) of the Communications Act and
Section 76.905 of the Commission’s rules.5 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.6 For the reasons set forth below, we grant the petition based on our
finding that Petitioner is subject to effective competition in the Communities listed on Attachment A.

II.

DISCUSSION

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


1 See 47 U.S.C. § 543(l)(1)(B).
2 47 C.F.R. § 76.905(b)(2).
3 The three Communities are American Canyon (CA1339), Napa (CA0407), and Sonoma (CA0325).
4 47 C.F.R. § 76.906.
5 See 47 U.S.C. § 543(l)(1); 47 C.F.R. § 76.905(b).
6 See 47 C.F.R. §§ 76.906-.907(b).

Federal Communications Commission

DA 13-960

households in the franchise area.7 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.8 It is undisputed that the 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.9 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.10 We further find that Petitioner has provided
sufficient evidence to support its assertion that potential customers in the Communities are reasonably
aware that they may purchase the service of these MVPD providers.11 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,12 and is supported in this petition
with copies of channel lineups for both DIRECTV and DISH.13 Also undisputed is Petitioner’s assertion
that both DIRECTV and DISH offer service to at least “50 percent” of the households in the Communities
because of their national satellite footprint.14 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, exceeds 15 percent of the households in a franchise
area. Petitioner asserts that it is the largest MVPD in the Communities.15 Petitioner sought to determine
the competing provider penetration in the Communities in part 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 Communities on a zip code plus four basis.16
Petitioner obtained AT&T subscriber numbers directly from that company.17 AT&T requested that its
subscriber numbers be kept confidential.18 We will accede to that request in this proceeding by
combining subscribership figures for AT&T and DBS providers. In providing the aggregate number of


7 47 U.S.C. § 543(l)(1)(B); 47 C.F.R. § 76.905(b)(2).
8 47 U.S.C. § 543(l)(1)(B)(i); 47 C.F.R. § 76.905(b)(2)(i).
9 See Petition at 3.
10 Mediacom Illinois LLC, 21 FCC Rcd 1175, 1176, ¶ 3 (2006).
11 47 C.F.R. § 76.905(e)(2).
12 See 47 C.F.R. § 76.905(g); see also Petition at 5.
13 See Petition at Ex. 2.
14 See Petition at 3.
15 See id. at 8; id., Declaration of Warren Fitting, Petitioner’s Director of Rate Regulation, at ¶ 3 (April 3, 2012).
16 Petition at 6-8. A zip code plus four analysis allocates DBS subscribers to a franchise area using zip code plus
four information that generally reflects franchise area boundaries in a more accurate fashion than standard five digit
zip code information.
17 See Petition at Ex. 5.
18 See Petition at 6 n.24; id. at Ex. 5.
2

Federal Communications Commission

DA 13-960

competing provider subscribers, we are thereby safeguarding AT&T’s request for confidentiality.19
6.
Based upon the aggregate subscriber penetration levels that were calculated using Census
2010 household data,20 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 Communities. Therefore, the second prong of the
competing provider test is satisfied for each of the 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 Communities listed on
Attachment A.

III.

ORDERING CLAUSES

7.
Accordingly,

IT IS ORDERED

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

IS GRANTED

.
8.

IT IS FURTHER ORDERED

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

IS REVOKED

.
9.
This action is taken pursuant to delegated authority pursuant to Section 0.283 of the
Commission’s rules.21
FEDERAL COMMUNICATIONS COMMISSION
Steven A. Broeckaert
Senior Deputy Chief, Policy Division, Media Bureau


19 We reserve the right to exercise our discretion to require more disclosure in future decisions. AT&T requested
confidentiality for the American Canyon, Napa, and Sonoma franchise areas. The competing provider subscriber
totals in Calistoga and St. Helena rely solely on DBS data.
20 Petition at Ex. 8.
21 47 C.F.R. § 0.283.
3

Federal Communications Commission

DA 13-960

ATTACHMENT A

MB Docket No. 12-103, CSR 8620-E

COMMUNITIES SERVED BY SUBSIDIARIES AND AFFILIATES OF

COMCAST CABLE COMMUNICATIONS, LLC

2010 Census

Estimated Competing

Communities

CUIDs

CPR*

Households

Provider Subscribers

American Canyon
CA1339
37.65
5,657
2130
Calistoga
CA0305
37.00
2,019
747
Napa
CA0407
34.26
28,166
9650
Sonoma
CA0325
20.71
4,955
1026
St. Helena
CA0319
25.70
2,401
617

*CPR = Percent of competitive penetration rate.
4

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