Federal Communications Commission DA 08-826 Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of Subsidiaries of Cablevision Systems Corporation Petitions for Determination of Effective Competition in Communities in New York State ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CSR 7413-E CSR 7414-E CSR 7415-E CSR 7416-E CSR 7538-E CSR 7539-E CSR 7548-E CSR 7610-E CSR 7611-E CSR 7612-E CSR 7613-E CSR 7620-E CSR 7621-E CSR 7622-E CSR 7623-E CSR 7624-E CSR 7686-E CSR 7687-E CSR 7691-E CSR 7694-E CSR 7695-E MEMORANDUM OPINION AND ORDER Adopted: April 7, 2008 Released: April 8, 2008 By the Senior Deputy Chief, Policy Division, Media Bureau: I. INTRODUCTION AND BACKGROUND 1. Cablevision Systems Corporation, through several subsidiaries, hereinafter referred to as “Petitioner,” has filed with the Commission petitions pursuant to Sections 76.7 and 76.905(b)(4) and 76.907 of the Commission’s rules for determinations that Petitioner is subject to effective competition in those communities listed on Attachment A and hereinafter referred to as “Communities.” Petitioner alleges that its cable systems serving the Communities are subject to effective competition pursuant to Section 623(1)(1)(D) 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 the Communities because of the competing service provided by Verizon, hereinafter referred to as “Competitor.”3 The petitions are unopposed. 1See 47 U.S.C. § 543(a)(1). 247 C.F.R. § 76.905(b)(4). 3Cablevision states that, in several Communities, its cable rates have never been regulated, but that it is petitioning to be free of rate regulation because “Verizon’s provision of cable service [in those Communities] . . . removes any doubt regarding the absence of authority to regulate Cablevision’s rates” in those Communities. Petition in CSR 7610-E at 4 n.5; Petition in CSR 7612-E at 5 n.5; Petition in CSR 7624-E at 4 n.5; Petition in CSR 7695-E at 4 n.5. (continued....) Federal Communications Commission DA 08-826 2 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 Petitions 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)(D) of the Communications Act provides that a cable operator is subject to effective competition if a local exchange carrier (“LEC”), or its affiliate, offers video programming services directly to subscribers by any means (other than direct-to-home satellite services) in the franchise area of an unaffiliated cable operator which is providing cable service in that franchise area, but only if the video programming services offered in that area are comparable to the video programming services provided by the competing unaffiliated cable operator.7 This test is otherwise referred to as the “LEC” test. 4. The Commission has stated that the incumbent cable operator must show that the LEC intends to build-out its cable system within a reasonable period of time if it has not completed its build- out; that no regulatory, technical, or other impediments to household service exist; that the LEC is marketing its services so that potential customers are aware that the LEC’s services may be purchased; that the LEC has actually begun to provide services; the extent of such services; the ease with which service may be expanded; and the expected date for completion of construction in the franchise area.8 It is undisputed that these Communities are served by both Petitioner and Competitor, a local exchange carrier, and that these two MVPD providers are unaffiliated. 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 programming9 and is supported in these petitions with copies of channel lineups for Competitor.10 Finally, Petitioner has demonstrated that the Competitor has commenced providing video programming service within the Communities, has marketed its services in a manner that makes potential subscribers reasonably aware of its services, and otherwise satisfied the LEC effective competition test consistent with the evidentiary requirements set forth in the Cable Reform (...continued from previous page) We find no flaw in Cablevision’s reasoning and filing petitions concerning Communities where there is no present regulation. Accordingly, we will rule on its Petitions for those Communities. Cablevision also states that in some of the Communities, its cable rates are regulated by the New York Public Service Commission rather than by local government bodies. See, e.g., Petition in CSR 7613-E at 4; Petition in CSR 7638-E at 3; Petition in CSR 7548-E at 4; Petition in CSR 7639-E at 3. Accordingly, in paragraph 7, infra, we revoke authority to regulate basic cable rates of both those Communities and, on their behalf, the New York Commission. 447 C.F.R. § 76.906. 5See 47 U.S.C. § 543(l) and 47 C.F.R. § 76.905. 6See 47 C.F.R. §§ 76.906 & 907. 7See 47 U.S.C. § 543(l)(D). 8See Implementation of Cable Act Reform Provisions of the Telecommunications Act of 1996, 14 FCC Rcd 5296, 5305-06, ¶¶ 13-16 (1999) (“Cable Reform Order”). 9See 47 C.F.R. § 76.905(g). See also Petition in CSR 7691-E at 11; Petition in CSR 7695-E at 11-12. 10See Petition in CSR 7539-E at Exh. 8; Petition in CSR 7687-E at Exh. 7. Federal Communications Commission DA 08-826 3 Order.11 5. Based on the foregoing, we conclude that Petitioner has submitted sufficient evidence demonstrating that its cable systems serving the Communities have met the LEC test and are subject to effective competition. III. ORDERING CLAUSES 6. Accordingly, IT IS ORDERED that the petitions for a determination of effective competition filed in the captioned proceeding by the subsidiaries of Cablevision Systems Corporation ARE GRANTED. 7. IT IS FURTHER ORDERED that the certification to regulate basic cable service rates granted to any of the Communities set forth on Attachment A or, on their behalf, to the New York State Public Service Commission, IS REVOKED. 8. This action is taken pursuant to delegated authority pursuant to Section 0.283 of the Commission’s rules.12 FEDERAL COMMUNICATIONS COMMISSION Steven A. Broeckaert Senior Deputy Chief, Policy Division, Media Bureau 11See Cable Reform Order, 14 FCC Rcd at 5305-06, ¶¶ 13-16. See also Petition in CSR 7621-E at 10-12; Petition in CSR 7694-E at 8-11. 1247 C.F.R. § 0.283. Federal Communications Commission DA 08-826 4 ATTACHMENT A CSR 7413-E, CSR 7414-E, CSR 7415-E, CSR 7416-E, CSR 7538-E, CSR 7539-E, CSR 7548-E, CSR 7610-E, CSR 7611-E, CSR 7612-E, CSR 7613-E, CSR 7620-E, CSR 7621-E, CSR 7622-E, CSR 7623-E, CSR 7624-E, CSR 7686-E, CSR 7687-E, CSR 7691-E, CSR 7694-E, CSR 7695-E COMMUNITIES SERVED BY SUBSIDIARIES OF CABLEVISION SYSTEMS CORPORATION Communities CUID(S) CSR 7413-E Ardsley NY 0793 Dobbs Ferry NY0792 Eastchester NY0739 Elmsford NY0468 Tuckahoe NY0743 CSR 7414-E Tarrytown NY 0738 CSR 7415-E Mt. Kisco NY 0427 CSR 7416-E Port Chester NY 1092 CSR 7538-E Smithtown NY 0242 CSR 7539-E Huntington NY 0392 CSR 7548-E North Hempstead NY 0453 Sands Point NY1215 Bayville NY 0665 New Hyde Park NY 0790 Freeport NY 0749 Williston Park NY0714 CSR 7610-E South Floral Park NY 1009 Floral Park NY0774 Garden City NY 0925 CSR 7611-E Scarsdale NY0707 Rye Brook NY0982 Bronxville NY0750 New Rochelle NY0700 White Plains NY 0805 Federal Communications Commission DA 08-826 5 CSR 7612-E Mount Pleasant NY 0713 Cortlandt NY 0771 CSR 7613-E North Castle NY 1056, NY 1277 Yonkers NY 0638 CSR 7620-E Islip NY 0239 Nissequogue NY 1429 Old Field NY 1576 CSR 7621-E Islip NY 0379 CSR 7622-E Poquott NY0929 CSR 7623-E Orangetown NY 0794 Piermont NY 0871 Airmont NY 1634 Chestnut Ridge NY 1448 Spring Valley NY 0447 Suffern NY 0842 CSR 7624-E Town of Haverstraw NY 0286 West Haverstraw NY 0291 Village of Haverstraw NY 0287 CSR 7686-E Peekskill NY 0284 CSR 7687-E Hillburn NY 0938 CSR 7691-E Head of the Harbor NY 1506 CSR 7694-E Mill Neck NY 1185 CSR 7695-E Buchanan NY 0281