NOTICE ********************************************************* NOTICE ********************************************************* This document was originally prepared in Word Perfect. If the original document contained-- * Footnotes * Boldface & Italics --this information is missing in this version The document format (spacing, margins, tabs, etc.) is changed too. If you need the complete document, download the Word Perfect version. For information about downloading documents (FTP) see file how2ftp. File how2ftp (.txt & .wp) is in directory /pub/Bureaus/Miscellaneous/Public_Notices/ ***************************************************************** ******** Before the Federal Communications Commission Washington, D.C. 20554 In re: ) ) Smith Television of New York, Inc. ) ) For Modification of the ADI Market ) CSR-3886-A of WKTV ) ) MEMORANDUM OPINION AND ORDER Adopted: May 2, 1996 Released: May 21, 1996 By the Deputy Chief, Cable Services Bureau: INTRODUCTION 1. Smith Television of New York, Inc., licensee of television broadcast station WKTV (channel 2, NBC), Utica, New York, has filed the captioned petition seeking to modify the Utica "area of dominant influence" (or "ADI") to include the communities served by cable systems in the western portion of Oneida County, communities in the northern and eastern portions of Madison County, several communities in the southeastern portion of Lewis County, and several communities in the western-most portion of Oswego County. Turin Cable Television filed an opposition to the petition to which WKTV replied. BACKGROUND 2. Pursuant to 614 of the Communications Act and implementing rules adopted by the Commission in its Report and Order in MM Docket 92-259, commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the station's market. A station's market for this purpose is its "area of dominant influence" or ADI as defined by the Arbitron audience research organization. An ADI is a geographic market designation that defines each television market exclusive of others, based on measured viewing patterns. Essentially, each county in the United States is allocated to a market based on which home-market stations receive a preponderance of total viewing hours in the county. For purposes of this calculation, both over-the-air and cable television viewing are included. 3. Under the Act, however, the Commission is also directed to consider changes in ADI areas. Section 614(h)(1)(C) provides that the Commission may: with respect to a particular television broadcast station, include additional communities within its television market or exclude communities from such station's television market to better effectuate the purposes of this section. In considering such requests, the Act provides that: the Commission shall afford particular attention to the value of localism by taking into account such factors as -- (I) whether the station, or other stations located in the same area, have been historically carried on the cable system or systems within such community; (II) whether the television station provides coverage or other local service to such community; (III) whether any other television station that is eligible to be carried by a cable system in such community in fulfillment of the requirements of this section provides news coverage of issues of concern to such community or provides carriage or coverage of sporting and other events of interest to the community; and (IV) evidence of viewing patterns in cable and noncable households within the areas served by the cable system or systems in such community. 4. The legislative history of this provision indicates that: where the presumption in favor of ADI carriage would result in cable subscribers losing access to local stations because they are outside the ADI in which a local cable system operates, the FCC may make an adjustment to include or exclude particular communities from a television station's market consistent with Congress' objective to ensure that television stations be carried in the areas which they serve and which form their economic market. * * * * * [This subsection] establishes certain criteria which the Commission shall consider in acting on requests to modify the geographic area in which stations have signal carriage rights. These factors are not intended to be exclusive, but may be used to demonstrate that a community is part of a particular station's market. 5. The Commission provided guidance in its Report and Order in MM Docket 92- 259, supra, to aid decision making in these matters, as follows: For example, the historical carriage of the station could be illustrated by the submission of documents listing the cable system's channel line-up (e.g., rate cards) for a period of years. To show that the station provides coverage or other local service to the cable community (factor 2), parties may demonstrate that the station places at least a Grade B coverage contour over the cable community or is located close to the community in terms of mileage. Coverage of news or other programming of interest to the community could be demonstrated by program logs or other descriptions of local program offerings. The final factor concerns viewing patterns in the cable community in cable and noncable homes. Audience data clearly provide appropriate evidence about this factor. In this regard, we note that surveys such as those used to demonstrate significantly viewed status could be useful. However, since this factor requires us to evaluate viewing on a community basis for cable and noncable homes, and significantly viewed surveys typically measure viewing only in noncable households, such surveys may need to be supplemented with additional data concerning viewing in cable homes. 6. In adopting rules to implement this provision, the Commission indicated that changes requested should be considered on a community-by-community basis rather than on a county-by-county basis and that they should be treated as specific to particular stations rather than applicable in common to all stations in the market. The rules further provide, in accordance with the requirements of the Act, that a station not be deleted from carriage during the pendency of an market area change request. 7. Adding communities to a station's market area generally entitles that station to insist on cable carriage in those communities. However, this right is subject to several conditions: 1) a cable system operator is generally required to devote no more than one-third of its activated channel capacity to compliance with the mandatory signal carriage obligations, 2) the station is responsible for delivering a good quality signal to the principal headend of the system, 3) indemnification may be required for any increase in copyright liability resulting from carriage, and 4) the system operator is not required to carry the signal of any station whose signal substantially duplicates the signal of any other local signal carried or the signals of more than one local station affiliated with a particular broadcast network. If, pursuant to these requirements, a system operator elects to carry the signal of only a single affiliate of a broadcast network, it is obliged to carry the affiliate from within the market whose city of license is closest to the principal headend of the cable system. Accordingly, based on the specific circumstances involved, the addition of communities to a station's market area may guarantee it cable carriage and specific channel position rights; simply provide the system operator with an expanded list of must-carry signals from which to choose, i.e., when it has used up its channel capacity mandated for broadcast signals carriage, or determined which of duplicating network affiliated stations are entitled to carriage priority. MARKET FACTS AND ADI ARGUMENTS 8. The communities at issue are located within portions of Oneida County, Madison County, Lewis County, and Oswego County, New York. WKTV, an NBC affiliate, is located in the Utica ADI which encompasses Herkimer County, Ostego County and the eastern portion of Oneida County, New York. WKTV maintains that the communities, together with the Utica ADI, constitute a region known as the Mohawk Valley. The City of Utica, New York, WKTV's city of license, is in Oneida County on the western-most border of the Utica ADI. The communities here in question which are located in the respective counties of Oneida County, Madison County, and Oswego are currently assigned to the Syracuse ADI. The remaining communities at issue, located in Lewis County, are currently assigned to the Watertown-Carthage ADI. 9. In its petition, WKTV states that application of the four factors enumerated in 47 U.S.C. 534(h)(1)(C)(ii) justifies its request to include the communities in its television market. In support of its petition, WKTV first asserts that it meets the first statutory criterion of historical carriage because it has been carried on all cable systems providing service in the communities. In fact, WKTV notes that, because of its extensive coverage of local news and events, it has been carried by all local cable systems since at least 1970. WKTV next asserts that it meets the second criterion by providing significant coverage and extensive local service. Further, WKTV asserts that it provides either a Grade A or Grade B contour over all of the communities. WKTV states that its city of license, the City of Utica, lies within 10 miles of some of the communities located in Oneida County, within 20 miles of some of the communities located in Madison County, within 30 miles of the communities in Lewis County, and within 35 miles of the communities in Oswego County. Essentially, WKTV is suggesting that all of the communities sought to be included in its ADI are within 35 miles of WKTV's city of license. In its supplemental information, WKTV clarifies statements made in its petition pertaining to the distance between certain communities at issue and WKTV's city of license. Specifically, WKTV adds that, in Lewis County, the community of Lyons Falls is approximately 48 miles from the City of Utica, that in Oswego County, the community of Constantia is approximately 37 miles from the City of Utica, the community of West Monroe is approximately 41 miles from the City of Utica, and the community of Central Square is approximately 46 miles from the City of Utica. WKTV argues that, as a result of the communities' proximity to its city of license, "the commerce and the culture of the Communities are inextricably linked." In addition, WKTV states that the geographical proximity makes it possible for WKTV to provide a Grade A contour which covers the majority of the communities in Oneida County and some of the communities located in Madison County. 10. With regard to local programming, WKTV asserts that it provides extensive, and often exclusive, coverage of the communities' news, sports, weather and special events. WKTV lists several programs focused on the communities of Griffiss Air Force Base, Sylvan Beach, and Rome. In addition, WKTV describes a public education campaign entitled "Baby Your Baby" in which it is a partner along with local hospitals and the State of New York. WKTV states that the campaign consists of a series of public service announcements, special news reports, referral brochures and a toll-free referral telephone number. WKTV further states that the campaign was targeted to Herkimer, Ostego, and Madison Counties but also influenced residents of Lewis and Montgomery Counties. WKTV notes that, in addition to its local news and public affairs programming, it has been designated by the State of New York as the emergency television channel for the entire Mohawk Valley. 11. With respect to the third statutory criterion, WKTV asserts that it is the only television station in the area which focuses a significant amount of programming on issues and events relevant to residents of the communities. WKTV states that some communities at issue, which are assigned to the Syracuse ADI, are served by television stations which are 60 miles away and whose programming is targeted to a much larger area and more diverse population than can be found in the Utica ADI. WKTV suggests that, because Syracuse is not located in the same county as any of the communities, Syracuse residents don't share the same concerns regarding local government and local services as do residents of the communities. WKTV next states that those communities at issue that are assigned to the Watertown-Carthage ADI do not have the benefit of another NBC affiliate and therefore would be deprived of NBC network programming should WKTV be denied must-carry rights in those areas. 12. Finally, WKTV asserts that local audience data demonstrate the popularity of WKTV in the communities. WKTV submitted audience data covering the western portion of Oneida County and states that such data is unavailable for the other communities because those communities constitute only a portion of the counties in which they lie. With regard to the western portion of Oneida County, WKTV states that in 1992 it received a 12 percent station share for overall viewing, the highest of all but two other stations serving that television market. WKTV notes that its ratings rose to 28 percent and 25 percent, respectively, during its 6 p.m. and 11 p.m. news program, ratings which were higher than WKTV's competitors by at least an 11 percent margin. With regard to audience viewing patterns for Madison County, WKTV states that in 1992 it received a one percent share overall and a four percent share during its 5:30 p.m. programming, despite the fact that its signal was not carried on cable systems serving many of the larger communities. In Lewis County, WKTV states that it received a three percent share, a rating which was higher than all other stations except those based in the Watertown-Carthage ADI and the NBC affiliate in Syracuse. WKTV argues that the communities in Lewis County are closer to and in fact, identify with, the Utica ADI. 13. In its comments, Turin Cable disputes WKTV's contention that it has been carried on cable systems serving the communities since 1970 because some of those systems had not been constructed at that time. Turin Cable argues against inclusion of communities located in Lewis County in WKTV's market. First, Turin Cable disputes that Lewis County is part of the Mohawk Valley, which WKTV seeks to include in its television market. Rather, Turin Cable asserts that Lewis County is part of the Black River Valley which is apparently more distant. Turin Cable next asserts that Lewis County is served by another television station, WWNY, with regard to emergency television broadcasts. 14. In its reply, WKTV asserts that Turin Cable's opposition is procedurally defective and should be dismissed because it was not filed properly with the Commission or served on all the parties on the original service list attached to the petition. WKTV notes that the opposition raises an issue that needs clarification concerning the historical carriage of WKTV in the communities. WKTV states that it has been carried on all the cable systems in the communities since 1970, unless those cable systems were constructed after 1970. DISCUSSION 15. The communities here in question are located in an area of the country that is served by overlapping affiliate signals from the same television network that originate in different markets. The two broadcast stations, WKTV and WSTM, are affiliated with the NBC television network . Most of the communities at issue are assigned to the Syracuse ADI which is geographically larger and more populous than the Utica ADI. WSTM is assigned to the larger Syracuse ADI. 16. WKTV's request for modification of its television markets will be granted with respect to the requested cable communities in Oneida County West and several of the requested communities in Madison County over which WKTV places a Grade A contour. WKTV's petition will be denied with respect to Oswego County, Lewis County and the Madison County communities of Bridgeport, Canastota, Chittenango, Clockville, and Wampsville over which WKTV does not place a grade A contour. With regard to the first statutory factor, WKTV has demonstrated that, since construction of the various systems, it has been carried on the cable systems serving the communities in question. 17. With regard to the second statutory factor, we note that WKTV, because of the proximity of its city of license, provides substantial local service to communities in Oneida County West. In support of its petition, WKTV asserts that its unique position to offer advertising services to business owners serving the communities also demonstrates local service. We note that the list of advertisers supplied by WKTV indicates that most are located in Oneida County West and, as a result, are not representative of all of the communities in the other counties that WKTV seeks to include in its ADI. We will consider the list of advertisers in our evaluation of this statutory factor but primarily with respect to communities in Oneida County West. WKTV further asserts that it provides signal coverage, providing at least a predicted Grade A or Grade B signal to all of the communities at issue. Specifically, WKTV provides a Grade A signal to the communities located in Oneida County West, and to the communities of Oneida, Munnsville, Stockbridge, Brookfield, Leonardsville, Bouckville and Madison in Madison County. The fact that WKTV provides a Grade A signal to these communities is a factor that is entitled to significant weight in this proceeding. 18. As evidence of local service, WKTV further asserts that it provides programming relevant to some of the communities at issue. We note that the programs cited by WKTV to demonstrate its local presence are focused primarily on issues that are relevant only to communities in Oneida County West. We further note that WKTV has failed to submit program logs or other information which would indicate that it carries programming focused on other communities in the counties it seeks to include within its television market. Finally, with respect to WKTV's local service, we take notice of the fact that WKTV has been designated by the State of New York as the emergency television station for the Mohawk Valley, in which a majority of the communities at issue are located. 19. With regard to the third statutory factor, WKTV argues that it provides more significant programming than other stations because it is focused almost exclusively on issues and events relevant to the Communities. It does not deny that other stations provide coverage. Although other stations provide local service to the communities, this fact does not act as a bar to a station's ADI claim. Rather, we believe that this criterion was intended to enhance a station's claim where it could be shown that other stations do not serve the communities at issue. Under such circumstances, a denial of carriage rights could deprive cable viewers of any broadcast signals that might provide programming to their communities. In the instant case, because other stations provide coverage to the majority of the communities at issue, the enhancement factor is not applicable. 20. Finally, we note that the evidence of viewing patterns in the communities persuades us that there is a basis for distinguishing between the communities which WKTV seeks to include within its market. As with historic carriage, this fourth factor is useful when it serves to discriminate among communities in order to determine which are within and which are outside of a particular television market. We find that distinguishing communities on the basis of audience data is particularly useful when an area is served by multiple affiliates of the same television network which largely overlap the relevant communities. The audience data for 1995 submitted by WKTV contrasts its audience share with that of WSTM the current NBC affiliate serving those communities located in the Syracuse ADI . In Oneida County West, WSTM received a 9 share while WKTV received an 11 share; in Madison County, WSTM received an 18 share while WKTV received a 2 share; and in Oswego County, WSTM received an 18 share while WKTV received no share. In Lewis county, which is located in the Watertown-Carthage ADI, WSTM got a 6 share while WKTV got a 2 share. Additionally, the current local provider of NBC/CBS programming in the Watertown-Carthage ADI, WWNY-TV, captured a 39 share. In sum, these figures indicate that in all the communities at issue WKTV only had larger audience shares in Oneida County West. 21. With regard to the communities located in Madison County, we will grant the requested relief with respect to those communities that are covered by WKTV's Grade A contour. These are Oneida, Munnsville, Stockbridge, Brookfield, Leonardsville, Bouckville and Madison. As noted above, we give great weight to this factor. Taken together, WKTV's historic carriage, Grade A contour and its proximity to these communities make inclusion appropriate despite WKTV's low audience share in Madison County. Therefore, based in the totality of evidence presented to us in the record, we will grant WKTV's request insofar as it relates to the subject communities located in Oneida County West and the above- named communities in Madison County, and deny it with respect to all of the other requested communities. Acting in this manner retains the fundamental predicate of the statutory mandatory carriage rule that carriage should be accorded within discrete, nonoverlapping, industry defined market areas while continuing to pay attention to the "value of localism" as set forth in Section 614(h)(1)(C). In this fashion it will "better effectuate" the purposes of Section 614. ORDERING CLAUSES 22. Accordingly, IT IS ORDERED, pursuant to 614(h) of the Communications Act of 1934, as amended (47 U.S.C.  532), and 76.59 of the Commission's Rules (47 C.F.R.  76.59), that the captioned petition for special relief (CSR-3886-A) filed May 28, 1993 by Smith Television of New York, Inc. IS GRANTED with regard to the communities located in Oneida County West: Durhamville, North Bay, Sylvan Beach, Verona Beach, Alder Creek, Blossvale, Boonville, Camden, Forestport, Lee Center, McConnellsville, North Western, Rome, Griffiss Air Force Base, Sherrill, Taberg, Vernon, Vernon Center, Verona, Westdale, Westernville, and Woodgate; and the following communities in Madison County: Oneida, Munnsville, Stockbridge, Brookfield, Leonardsville, Bouckville and Madison. This change shall be effective in accordance with the following schedule: WKTV shall notify the cable systems in question in writing of its carriage and channel position elections, ( 76.56, 76.57. 76.64(f) of the Commission's Rules), within thirty (30) days of the release of this Memorandum Opinion and Order. The cable systems shall come into compliance with the applicable rules within 60 days of such notification. 23. IT IS FURTHER ORDERED that the requested relief IS DENIED with respect to the the Oswego County and Lewis County communities and with respect to the Madison County communities of Bridgeport, Canastota, Chittenango, Clockville, and Wampsville. 24. This action is taken pursuant to authority delegated by 0.321 of the Commission's Rules. FEDERAL COMMUNICATIONS COMMISSION William H. Johnson Deputy Chief, Cable Services Bureau