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Time Warner Cable Seeks Ohio, Ky. Cable Rate Exemption

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Released: March 15, 2011

Federal Communications Commission

DA 11-491

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

CSR 8380-E
Time Warner Cable Inc.
)
CSR 8381-E
)
CSR 8388-E
Petitions for Determination of Effective
)
CSR 8389-E
Competition in Communities in Ohio and
)
Kentucky
)

MEMORANDUM OPINION AND ORDER

Adopted: March 14, 2011

Released: March 15, 2011

By the Senior Deputy Chief, Policy Division, Media Bureau:

I.

INTRODUCTION AND BACKGROUND

1.
Time Warner Cable, Inc., hereinafter referred to as "Petitioner," has filed with the
Commission four petitions 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 system serving the Attachment A 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"). Petitioner additionally claims
to be exempt from cable rate regulation in the Communities listed on Attachment B and hereinafter
referred to as Attachment B Communities, pursuant to Section 623(l)(1)(B) of the Communications Act
3and Section 76.905(b)(1) of the Commission's rules,4 because the Petitioner serves fewer than 30 percent
of the households in the franchise area.5 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 See 47 U.S.C. 543(l)(1)(A).
4 47 C.F.R. 76.905(b)(1).
5 Time Warner has requested that 9 communities in CSR 8388-E be withdrawn. Letter from Craig Gilley, Esq.,
Fleischman and Harding LLP, counsel for Time Warner, to Steven A. Broeckaert, Senior Deputy Chief, Policy
Division, Media Bureau (dated Jan. 31, 2011). There is no opposition to the request, and we grant it.
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 11-491

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 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 programming13 and is supported in
these petitions with copies of channel lineups for both DIRECTV and DISH.14 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.15 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 the Attachment A Communities.16 Petitioner sought
to determine the competing provider penetration in 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.17


9 47 U.S.C. 543(l)(1)(B); see also 47 C.F.R. 76.905(b)(2).
10 47 C.F.R. 76.905(b)(2)(i).
11 See, e.g., Petition in CSR 8380-E at 3-5.
12 Mediacom Illinois LLC, 21 FCC Rcd 1175, 1176, 3 (2006).
13 See 47 C.F.R. 76.905(g). See, e.g., Petition in CSR 8381-E at 5-6.
14 See, e.g., Petition in CSR 8388-E at 6-7.
15 See, e.g., Petition in CSR 8389-E at 7.
16 See, e.g., Petition in CSR 8380-E at 7.
17 See, e.g., Petition in CSR 8381-E at 7.
2

Federal Communications Commission

DA 11-491

6.
Based upon the aggregate DBS subscriber penetration levels that were calculated using
Census 2000 household data,18 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.19 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 Communities.
8.
Based upon the subscriber penetration level calculated by Petitioner, as reflected in
Attachment B, we find that Petitioner has demonstrated the percentage of households subscribing to its
cable service is less than 30 percent of the households in the Attachment B Communities.20 Therefore,
the low penetration test is satisfied as to the Attachment B Communities.

III.

ORDERING CLAUSES

9.
Accordingly,

IT IS ORDERED

that the petitions for a determination of effective
competition filed in the captioned proceeding by Time Warner Cable Inc.,

ARE GRANTED

.
10.

IT IS FURTHER ORDERED

that the certification to regulate basic cable service rates
granted to or on behalf of 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.21
FEDERAL COMMUNICATIONS COMMISSION
Steven A. Broeckaert
Senior Deputy Chief, Policy Division, Media Bureau


18 See, e.g., Petition in CSR 8388-E at Exh. B.
19 47 U.S.C. 543(l)(1)(A).
20 We note that in several of the Attachment B Communities (St. Mary's Township, Jefferson Township, Henry
Township, and Northwood City) our low penetration finding is close to the statutory threshold. We are constrained
by the statute to nevertheless determine the existence of effective competition. We further note that household
information based on the 2010 Census is or will soon be available. If any of these Communities believes that
effective competition is no longer present within its franchise area, it may file a petition for recertification pursuant
to Section 76.916 of the Commission's rules. 47 C.F.R. 76.916.
21 47 C.F.R. 0.283.
3

Federal Communications Commission

DA 11-491

ATTACHMENT A

CSRs 8380-E, 8381-E, 8388-E, 8389-E

COMMUNITIES SERVED BY TIME WARNER CABLE INC.


2000 Census

Estimated DBS

Communities

CUIDs

CPR*

Households

Subscribers

CSR 8380-E

Roundhead Township
OH2162
47.14%
280
132

CSR 8381-E

Adelphi Village
OH0768
25.00%
156
39
Harrison Township
OH2614
30.57%
471
144
Huntington Township
OH0423
17.60%
2199
387
Liberty Township
OH1726
23.94%
965
231
Nile Township
OH1188
38.87%
764
297
Pee Pee Township
OH2649
34.55%
1291
446
Piketon Township
OH0535
31.31%
693
217
Springfield Township
OH2637
23.68%
929
220
Union Township
OH2640
17.80%
2613
465
Waverly Township
OH0182
17.01%
2028
345

CSR 8388-E

Concord Township
OH2204
48.62%
1300
632
Deer Creek Township
OH0827
41.10%
382
157
Hamilton Township
OH0877
29.87%
1798
537
Harrison Township
OH3009
40.58%
653
265
OH2911
Hopewell Township
OH1984
45.29%
1029
466
OH2988
Liberty Township (Delaware
OH2909
36.48%
3407
1243
County)
Murray City Village
OH0495
40.53%
190
77
Newton Township
OH0273
27.26%
1948
531
North Bloomfield
OH1343
45.77%
697
319
Pataskala
OH0944
31.87%
3922
1250
Perry Township
OH0203
30.45%
867
264
OH3016
Pleasant Township
OH0407
30.46%
1855
565
(Fairfield County)
Powell City
OH1470
18.18%
1975
359
OH1664
Shawnee Hills Village
OH2461
17.13%
181
31
Washington Township
OH0158
16.75%
1606
269
(Muskingum County)
OH1852
Wayne Township
OH0159
OH2643
16.51%
1738
287
OH2886
4

Federal Communications Commission

DA 11-491

2000 Census

Estimated DBS

Communities

CUIDs

CPR*

Households

Subscribers

CSR 8389-E

Arlington Village
OH1032
19.04%
520
99
Attica Village
OH1365
40.20%
393
158
Center Township
OH3028
44.86%
399
179
Clay Township
OH0913
43.26%
1061
459
Clinton Township
OH1039
25.32%
1560
395
Clyde City
OH0031
22.96%
2304
529
Fostoria City
OH0034
OH2286
17.21%
5565
958
OH2292
Green Springs Village
OH1044
19.64%
443
87
OH1245
Harpster Village
OH2285
17.65%
85
15
Liberty Township
OH0444
OH2884
23.99%
2363
567
OH3030
OH2761
Marion Township
OH0443
32.92%
881
290
Marseilles Village
OH2900
29.17%
48
14
Millbury Village
OH1182
42.99%
421
181
New Washington Village
OH1369
20.87%
393
82
Perry Township
OH0552
27.85%
736
205
Rawson Village
OH1248
15.09%
159
24
Upper Sandusky City
OH0042
26.24%
2744
720
Washington Township
OH3021
43.71%
636
278
Wayne Village
OH1459
20.77%
313
65
West Millgrove Village
OH2217
56.00%
25
14
Weston Township
OH3034
37.87%
272
103

*CPR = Percent of competitive DBS penetration rate.
5

Federal Communications Commission

DA 11-491

ATTACHMENT B

CSRs 8380-E, 8381-E, 8388-E, 8389-E

COMMUNITIES SERVED BY TIME WARNER CABLE INC.

Franchise Area

Cable

Penetration

Communities

CUIDs

Households

Subscribers

Percentage

CSR 8380-E

Clay Township
OH2994
251
31
12.35%
Goshen Township
OH2399
187
35
18.72%
Jennings Township
OH3023
228
6
2.63%
(Van Wert County)
Jennings Township
OH3013
492
1
0.20%
(Putnam County)
Liberty Township
OH3014
408
3
0.74%
Logan Township
OH2442
325
2
0.62%
Marion Township
OH1144
1012
184
18.18%
Monroe Township
OH1238
607
70
11.53%
OH2443
Moulton Township
587
6
1.02%
OH2439
Noble Township
OH2440
427
3
0.70%
Pusheta Township
OH2995
444
12
2.70%
Richland Township
OH1413
658
11
1.67%
St. Marys Township
OH2437
1384
411
29.70%
City of St. Marys
OH0050
3218
685
21.29%
OH3018
Sugar Creek Township
404
69
17.08%
OH1751
Union Township
OH2398
592
1
0.17%
(Auglaize County)
Union Township
OH2412
300
17
5.67%
(Mercer County)
Washington Township
OH2441
367
3
0.82%
(Auglaize County)
Washington Township
OH3024
1592
155
9.74%
(Van Wert County)
Willshire Township
OH2410
375
2
0.53%

CSR 8381-E

Centerville Township
OH3047
134
19
14.18%
Colerain Township
OH1976
565
17
3.01%
Concord Township
OH3065
1102
141
12.79%
Franklin Township
OH1998
616
100
16.23%
Green Township
OH2993
266
4
1.50%
(Adams County)
Green Township
OH2931
3460
728
21.04%
(Ross County)
OH3066
Unincorporated Greenup
KY0148
6630
431
6.50%
County
6

Federal Communications Commission

DA 11-491

Franchise Area

Cable

Penetration

Communities

CUIDs

Households

Subscribers

Percentage

CSR 8381-E continued

Jefferson Township
OH2192
382
108
28.27%
Laurelville, Village of
OH0769
256
40
15.63%
Unincorporated Lewis County
KY0202
4737
98
2.07%
Madison Township
OH3057
836
36
4.31%
Raccoon Township
OH2527
490
3
0.61%
Salt Creek Township
OH3054
459
5
1.09%
(Hocking County)
Salt Creek Township
OH3054
324
35
10.80%
(Pickaway County)
Scioto Township
OH2251
5940
127
2.14%
Seal Township
OH1183
1098
64
5.83%

CSR 8388-E

Allen Township
OH1556
512
3
0.59%
Auglaize Township
OH2784
843
20
2.37%
OH2120
Berlin Township
1180
63
5.34%
OH2998
Big Island Township
OH2989
475
4
0.84%
Blendon Township
OH3001
2841
12
0.42%
Blue Rock Township
OH3061
249
7
2.81%
Bokescreek Township
OH2406
193
3
1.55%
Bowling Green Township
OH3004
204
2
0.98%
Buck Township
OH3002
2428
4
0.16%
Canaan Township
OH2888
591
111
18.78%
Cass Township
OH3008
509
97
19.06%
Chester Township
OH1857
1605
1
0.06%
OH2984
Clay Township
353
5
1.42%
OH2754
Clayton Township
OH2889
500
47
9.40%
College Township
OH2985
143
34
23.78%
Green Camp Township
OH3005
1163
4
0.34%
Harmony Township
OH1855
714
4
0.56%
Hilliar Township
OH2986
546
74
13.55%
Holmes Township
OH0475
505
2
0.40%
Howard Township
OH1985
1682
194
11.53%
OH2990
Jackson Township
655
45
6.87%
OH3010
Jefferson Township
OH3011
160
3
1.88%
Lafayette Township
OH2996
766
5
0.65%
Leesburg Township
OH2908
407
46
11.30%
Liberty Township
OH2910
585
85
14.53%
(Union County)
Liberty Township
OH1390
1539
74
4.81%
(Fairfield County)
7

Federal Communications Commission

DA 11-491

Franchise Area

Cable

Penetration

Communities

CUIDs

Households

Subscribers

Percentage

CSR 8388-E continued

Liberty Township
OH2755
526
33
6.27%
(Knox County)
Lincoln Township
OH1854
576
4
0.69%
Linton Township
OH2997
196
6
3.06%
Lykens Township
OH2980
238
2
0.84%
MadisonTownship
OH3012
185
3
1.62%
Marion Township
OH1787
2401
7
0.29%
Middlebury Township
OH2115
369
2
0.54%
Mifflin Township
OH3035
248
2
0.81%
Morgan Township
OH3060
303
3
0.99%
Morris Township
OH2116
715
2
0.28%
OH0813
Muskingum Township
1399
55
3.93%
OH1465
Orange Township
OH2999
12464
3
0.02%
Oxford Township
OH3000
295
2
0.68%
Peru Township
OH1853
439
7
1.59%
Pleasant Township
OH2912
1162
139
11.96%
(Marion County)
Pleasant Township
OH2316
464
4
0.86%
(Knox County)
Pleasant Township
OH1176
2424
163
6.72%
(Franklin County)
Pleasant Township
OH0908
506
9
1.78%
(Madison County)
Pleasant Township
OH3063
298
3
1.01%
(Perry County)
Porter Township
OH2890
579
89
15.37%
Richland Township
OH2416
198
44
22.22%
(Wyandot County)
Richland Township
OH3006
602
3
0.50%
(Marion County)_
Salem Township
OH2415
243
5
2.06%
Scioto Township
OH1897
767
3
0.39%
South Bloomfield Township
OH1856
504
6
1.19%
Troy Township
OH3052
816
86
10.54%
Waldo Township
OH3007
264
2
0.76%
Ward Township
OH3055
397
1
0.25%
Washington Township
OH3026
313
11
3.51%
(Licking County)

CSR 8389-E

OH3027
Bloom Township
320
33
10.31%
OH3025
Cass Township
OH2982
1098
142
12.93%
Damascus Township
OH3003
379
3
0.79%
8

Federal Communications Commission

DA 11-491

Franchise Area

Cable

Penetration

Communities

CUIDs

Households

Subscribers

Percentage

CSR 8389-E continued

Delaware Township
OH2019
271
14
5.17%
Freedom Township
OH1581
472
56
11.86%
Groton Township
OH2891
500
14
2.80%
Henry Township
OH3029
256
57
22.27%
Madison Township
OH0443
435
45
10.34%
Marseilles Township
OH2991
128
2
1.56%
Milton Township
OH3031
236
3
1.27%
Northwood City
OH1082
2024
480
23.72%
Oregon City
OH3075
7708
1
0.01%
Perrysburg Township
OH1190
5161
278
5.39%
Plain Township
OH2885
616
5
0.81%
OH3022
Pleasant Township
282
38
13.48%
OH1036
OH2983
Portage Township
363
33
9.09%
OH3032
Reed Township
OH2014
341
45
13.20%
Scott Township
OH3020
532
1
0.19%
Sherman Township
OH3017
172
1
0.58%
Thompson Township
OH1046
2383
100
4.20%
Webster Township
OH3034
434
2
0.46%
9

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