$//MO&O Denying KKAK carriage on Continental Cablevision, DA-95-71//$ $/300.534 Carriage of local commercial television signals/$ $/76.61 Disputes concerning carriage/$ ///newjob/// $///DA 95-71,1/20/95///$ Before the FEDERAL COMMUNICATIONS COMMISSION Washington, D.C. 20554 DA-95-71 In re: ) Continental Cablevision of ) Sierra Valleys, Inc. ) CSR-4220-M Cablevision of Central Florida ) ) Operator of a Cable ) Television System Serving ) Visalia/Tulare, Corcoran, Fresno, ) and Hanford, CA ) MEMORANDUM OPINION AND ORDER Adopted: January 17, 1995 Released: January 26, 1995 By the Chief, Cable Services Bureau: INTRODUCTION 1. On October 5, 1992, the Cable Television Consumer Protection and Competition Act of 1992 (1992 Cable Act) became law. On March 11, 1993, the Commission adopted a Report and Order to implement the mandatory broadcast signal carriage ("must-carry") provisions of the Cable Act. Pursuant to the rules adopted in the Report and Order, cable systems were required to commence carriage of local broadcast stations entitled to must-carry status beginning June 2, 1993. On June 17, 1993, local broadcast stations were required to make their initial election of either must-carry or retransmission consent status and notify cable systems of their election. Those broadcast stations which elected must-carry status were required to notify the cable system of their preferred channel position at that time. SUMMARY OF PLEADINGS 2. On February 15, 1994, The Kralowec Children's Family Trust (Press), licensee of KKAK (TV), filed a complaint against Continental Cablevision of Sierra Valleys, Inc. (Continental) for the latter's alleged failure to comply with the channel positioning requirements of the Commission's Rules and the 1992 Cable Act. 3. KKAK began operating on May 7, 1992. Its over-the-air channel position is 61. According to its complaint, on April 16, 1993 KKAK notified Continental that KKAK met the requirements for must-carry and had elected must-carry status on Continental's system. Continental was advised that KKAK wished to be carried on channel 5 of Continental's system. However, respondent placed KKAK on cable channel 33 in Visalia/Tulare and channel 36 in Corcoran. KKAK argues that it has been placed in a disadvantageous channel position "at variance with the intent of Congress in establishing its channel positioning rules." On December 6, 1993 KKAK again requested that it be carried on channel 5; by letter, Continental rejected that request. Continental, in this instance,basically amplified and expanded its earlier position that the Commission's must-carry rules set out a broadcaster's channel selection options and that a broadcaster's channel preference is not the determinative factor in this instance. DISCUSSION 4. We address KKAK's claim that it is entitled to be carried on channel 5. The Cable Act and our rules offer three channel options available to broadcast stations electing must-carry: 1) a station may elect to be carried on its over-the-air channel; or 2) on the channel on which it was carried on July 19, 1985; or 3) on the channel on which it was carried on January 1, 1992. The rules also provide that a broadcast station may be carried "on such other channel as is mutually agreed upon by the station and the cable operator." Given that KKAK began operating in May of 1992 and its over the air channel number exceeds the number of channels--41-- on Falcon's system, complainant has interpreted the language "on such other channel as is mutually agreed upon by the station and the cable operator" as constituting a fourth option that prevents Falcon from unilaterally deciding which channel complainant will occupy. KKAK also believes that where a broadcaster may not take advantage of these three statutorily designated channel options it may not be left to the cable operator to determine where to place the broadcaster. We disagree with complainant's reading of our rules. 5. We read the 1992 Cable Act and the Commission's Rules to unambiguously state that there are three options--not four--available to a broadcaster. The language which allows cable operators and broadcasters to mutually agree upon a different channel is the mechanism by which the two may reach a channel positioning option outside of the three proposed by the 1992 Cable Act's provisions. It is simply a way of saying that the parties have the flexibility to reach a result different from the three statutory options. It does not, however, mean that in the event the three options are not available the parties must agree on the ultimate placement of the channel. To read this flexibility as a mandatory fourth option would totally obviate the prior three options as broadcasters would clash with other broadcasters in seeking what they viewed as a more favorable channel position, leaving the cable operator in the position of having to choose between competing broadcasters. In the present case, KKAK was initially carried by Continental on channels 33 and 36. Channel 61 is KKAK's over-the-air channel, and KKAK was not in operation on either July 19, 1985 or January 1, 1992. Though the parties were not able to reach a mutually agreeable channel, we find nothing improper with Continental's unilateral assignment of KKAK to channels 33 and 36. 6. KKAK also contends that "Congress clearly indicated its preference for channel choices that limit cable operators' ability to carry local stations on inferior channel positions." It believes that channel's 33 and 36 are outside of what it calls Continental's "de facto broadcast tiers", channels 1-13, and that it is "segregate[ed]" to an end of the viewing band away from the favorable channel positions enjoyed by all other local commercial television stations. 7. We certainly understand KKAK's desire to remain as competitive as possible. However, there is no specific nor implicit requirement that cable operators arrange their basic tier such that some sort of alleged economic equilibrium amongst broadcasters is attained. Inferring such a requirement would complicate channel positioning election beyond anything envisioned by Congress. Thus, we find that Continental has complied with the requirements of the 1992 Cable Act. 8. Accordingly, the petition filed on February 15, 1994, by The Kralowec Children's Family Trust IS DENIED, in accordance with Section 614(b)(6) (47 U.S.C.  534) of the Communications Act of 1934, as amended. This action is taken by the Chief, Cable Services Bureau, pursuant to authority delegated by Section 0.321 of the Commission's Rules. FEDERAL COMMUNICATIONS COMMISSION William H. Johnson Acting Chief, Cable Services Bureau