WPCP 2B'J  CourierCG TimesCG Times BoldCG Times ItalicE37XPCG Timeset 4_230_1HPLAS4.PRS 4x  @\_)^X@2 6f F Z  3|w ",tB^ f ^;C]ddCCCdCCCCddddddddddCCY~~vCN~sk~CCCddCYdYdYCdd88d8ddddJN8ddddYYdYd4dddddCddddddddd8YYYYYY~Y~Y~Y~YC8C8C8C8ddddddddddYdddddsdXdXXXddx|X~d~d|XdddddddC8ddddCdoddd|8|H~d<|8dtddddHHdlLlLlLkd|H|8~ddddddddXXXd~ddkd~ddxCddCCCWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNdddCYQQddddddFddddFCChhd44ddzzdddvooChdF"dhd9dCCzCddoddCdYds]zUvdYYCCCCz~ozoY~NYdYC8YooYdYzsdzdd~YYzozzz~CdzYzzzzCCdddddddzCsdYC\   pxtll\tll@\@\`LHP LaserJet 4_230_1HPLAS4.PRS 4Xw PE37\_)^XP2B f q vpMCG TimesCG Times BoldCG Times ItalicCourier",tB^ f ^;C]ddCCCdCCCCddddddddddCCdxN`xoCCCddCdoYoYFdo8Co8odooYNCodddYdddd4dddddCddddddddo8dddddYYYYYN8N8N8N8oddddooooddpddddxodddXXddXddXdddddooL8doddNorddo8PdN8ppoddXXdpLoNpLodPDdopoopodXYXodoodddCddCCCWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNdddCdUUddddddFddddFCCssd44ddzzddd~ooCsdF"dsd9dCCzCddoddCdYds`zUvdddCCCCzozoYNYYYN8YooYdYzzdzddYYzozzzNdzYzzzzCCdddddddzCzdYC\   pxtll\tll@\@\`La8DocumentgDocument Style StyleXX` `  ` a4DocumentgDocument Style Style . 2kkZvja6DocumentgDocument Style Style GX  a5DocumentgDocument Style Style }X(# a2DocumentgDocument Style Style<o   ?  A.  a7DocumentgDocument Style StyleyXX` ` (#` 2jt   BibliogrphyBibliography:X (# a1Right ParRight-Aligned Paragraph Numbers:`S@ I.  X(# a2Right ParRight-Aligned Paragraph Numbers C @` A. ` ` (#` a3DocumentgDocument Style Style B b  ?  1.  2!  H  a3Right ParRight-Aligned Paragraph Numbers L! ` ` @P 1. ` `  (# a4Right ParRight-Aligned Paragraph Numbers Uj` `  @ a. ` (# a5Right ParRight-Aligned Paragraph Numbers _o` `  @h(1)  hh#(#h a6Right ParRight-Aligned Paragraph Numbersh` `  hh#@$(a) hh#((# 2/%!"_#_$a7Right ParRight-Aligned Paragraph NumberspfJ` `  hh#(@*i) (h-(# a8Right ParRight-Aligned Paragraph NumbersyW"3!` `  hh#(-@p/a) -pp2(#p Tech InitInitialize Technical Style. k I. A. 1. a.(1)(a) i) a) 1 .1 .1 .1 .1 .1 .1 .1 Technicala1DocumentgDocument Style Style\s0  zN8F I. ׃  2'a%%o&'a5TechnicalTechnical Document Style)WD (1) . a6TechnicalTechnical Document Style)D (a) . a2TechnicalTechnical Document Style<6  ?  A.   a3TechnicalTechnical Document Style9Wg  2  1.   2j*'(^))a4TechnicalTechnical Document Style8bv{ 2  a.   a1TechnicalTechnical Document StyleF!<  ?  I.   a7TechnicalTechnical Document Style(@D i) . a8TechnicalTechnical Document Style(D a) . 203*+e/80Doc InitInitialize Document Stylez   0*0*0*  I. A. 1. a.(1)(a) i) a) I. 1. A. a.(1)(a) i) a)DocumentgPleadingHeader for Numbered Pleading PaperE!n    X X` hp x (#%'0*,.8135@8:><q*"xxxxWWxxxWWkkxxxFx6X@`7X@dddCCdxxxsCYoxxdoxxooCCCdddYdY8dd88Y8ddddLL8dYYYLYdYd4ddddd"i~'K2^$(8<><q*"xxxxWWxxxWWkkxxx= Y"-ԍ#Xw PE37=9XP# The 1992 Cable Act (Communications Act of 1934  623(a)(2)) and the Commission's rules (47 C.F.R.  76.905(a)) provide that only the rates of cable systems that are not subject to effective competition may be regulated. One of the bases by which a cable system will be deemed subject to effective competition is if fewer than 30 percent of the households in the system's franchise area subscribe to the system's service. Communications Act of 1934  623(l)(1)(A), 47 U.S.C.  543(l)(1)(A); 47 C.F.R.  76.905(b)(1). g Specifically, Telesat claims that it serves"|0*((K" 21,031 of the 160,356 households in the franchise area or 13.1 percent of the total number of  Y-households. As supporting documentation, Telesat provides 1990 Census data% = Yb-ԍ #Xw PE37=9XP#As the Commission has stated recently, the 1990 Census data is an appropriate source  YK-for household data. Effective Competition Order, supra.#x6X@`7>FX@#% which  Y-demonstrates that there are 160,356 households (that is, occupied housing units) cd= Y-ԍ #Xw PE37=9XP#As the Commission stated recently, "we presume that Congress did not intend "households" to have a different meaning than in the 1990 Census that would include vacant  Y-units." Third Order on Reconsideration, MM Docket Nos. 92266 and 92262, 9 FCC Rcd  Y -4316, 4324 (1994) ("Third Recon. Order"). The count of "households" in the 1990 Census reflects only occupied housing units. See Bureau of Census, 1990 Census of Population and Housing, Summary Population and Housing Characteristics, Florida, 1990 CPH111, table 5  Ya -at 73.#x6X@`7>FX@# in its franchise area. Telesat also submits a computer printout with sufficient subscriber information to show that it serves 21,031 households in the franchise area. Finally, Telesat provides an affidavit by a responsible official certifying to the accuracy of the data included in the petition and the supplement thereto.  YH-x4.` ` In its opposition to Telesat's petition, the County argues that Telesat is not  Y1-subject to effective competition because it has "redefined" its franchise area.  1 = Yq-ԍ#Xw PE37=9XP# In the First Order on Reconsideration, the Commission clarified the definition of  Y\-"franchise area" for purposes of determining effective competition. First Order on  WG-Reconsideration, Second Report and Order, and Third Further Notice of Proposed  Y0-Rulemaking, MM Docket No. 92266, 9 FCC Rcd 1164 ("First Recon. Order"). Generally,  Y-"[a] franchise area is the area a system is granted authority to serve in its franchise." Id. at 1180. The Commission stated, however, that a more restrictive definition of "franchise area" may be more appropriate under limited circumstances, such as when an operator, "has itself, through its own conduct, selfdefined the areas to be served to such an extent that this  Y-redefined area accurately portrays the operator's 'franchise area.'" Id. at 1181. Under this standard, the franchising authority has the burden of showing that the operator has made an  Y-"affirmative decision . . . to restrict service." Id.į The County alleges that Telesat has made an affirmative decision to limit its service area to only a portion of its authorized franchise area. The County argues that by including household data from portions of the franchise area that Telesat does not actually serve, Telesat miscalculates its penetration level. As supporting documentation, the County submits the following: a copy  Y -of an Orange County statistical report which, inter alia, calculates the penetration rates of the  Y -five cable operators serving the County,e  f= Y$-ԍ The Cou#Xw PE37=9XP#nty has issued nonexclusive franchises to five cable operators (Hunter's Creek, Telesat Cablevision, Cablevision, Inc., Cablevision of Central Florida and Central Florida Satellite Cable). Each operator is authorized to serve the unincorporated area of Orange County.e a copy of Telesat's 15 year franchise agreement"  0*((=" with the County dated June 23, 1986, and three maps separately detailing (1) the areas actually served by Telesat and its competitors within Orange County as of April 27, 1993; (2) the location of the unincorporated areas of Orange County as of 1993; and (3) the areas actually served by Telesat and its competitors within Orange County as of August 22, 1991. The County asserts that these exhibits demonstrate that Telesat does not offer service to its entire authorized franchise area and has not expanded its service beyond the portions it was  Yv-already serving in 1991.) vv= Y-ԍ The County claims that according to a cable television statistical report prepared by the Orange County Cable Communications Department for the second quarter of 1993, Telesat's system physically passes 41,792 residential units in its franchise area and serves 21,031 of those units. The County claims that comparing these two numbers yields a penetration rate of 50.32 percent, which is significantly higher than a rate of 30 percent or less, as required by the low penetration test for effective competition.) In addition, the County submits a copy of a 1992 contract which documents Telesat's sale of a portion of its Orange County system, located in the south central region of the County known as Meadow Woods, to its competitor, Cablevision Industries. Because this sale actually reduced Telesat's coverage in its service area, the County argues that the sale lends further support for its argument that Telesat has redefined its franchise area by restricting its area of service to limited portions of its entire authorized franchise area.  Y -x5.` ` In its reply, Telesat argues that it has not limited its service area, nor has it redefined its franchise area. To the contrary, Telesat maintains that since 1986, when it was granted its franchise, it has built three separate, noncontiguous overbuild systems in Orange County. Telesat claims that the County's Map "B", which depicts Telesat's actual service area in 1993, proves that Telesat has expanded its service area beyond its 1991 borders, as depicted in the County's Map "D". Furthermore, Telesat contends that none of the evidence submitted, including the 1992 contract between it and Cablevision, sufficiently demonstrates that Telesat has affirmatively excluded any portion of its authorized franchise area from its potential service. Instead, Telesat asserts that because of the existence of actual competition in its franchise area, the lack of expansion over a period of less than two years does not prove that Telesat has chosen to restrict its service area or redefine its franchise area. To further emphasize its position, Telesat claims that much of its system is in overbuild situations with the other operators providing service in the County and that this makes expansion throughout the County more competitive and, therefore, more difficult.  Ye-x6.` ` As a preliminary matter, we are not persuaded that Telesat has affirmatively restricted its service area to some portion that is appreciably smaller than Telesat's authorized franchise area, for purposes of effective competition. The County concedes that Telesat's authorized franchise area encompasses the entire unincorporated area of Orange  Y -County. Moreover, as the Commission stated in the First Recon. Order, "the fact that a franchise area has not as yet been filled out by construction of a system would not by itself" 0*(("  Y-be taken as redefining the service area."q= Yy-ԍ#Xw PE37=9XP# First Recon. Order, supra.q The County has not offered sufficient evidence showing that Telesat has affirmatively decided to forego the possibility of further expanding its area of service within its authorized franchise area. We agree with Telesat that the County cannot only rely on Telesat's expansion record during a period of time encompassing less than two years over the life of a 15 year franchise to determine that Telesat has restricted its efforts at further expansion.  Y_-x7.` ` However, we recognize that, in 1992, Telesat sold the Meadow Woods portion of its system, located in the south central region of Orange County, to Cablevision Industries. As a condition to the contract of sale, Telesat agreed to refrain from providing any type of cable service to the Meadow Woods area for a period of five years. This evidence is sufficient to prove that Telesat has redefined its franchise area to exclude the  Y -Meadow Woods area." {= Y-ԍ Although we are accepting the terms of this agreement as evidence that Telesat has redefined its franchise area, we are expressing no opinion on whether a 5year anticompetitive agreement is reasonable or in accordance with the Communications Act." However, even when accounting for the exclusion of Meadow Woods from Telesat's franchise area, the record reveals that Telesat's penetration rate is still less than 30 percent. Specifically, the evidence shows that even when excluding the total number of households located in the Meadow Woods area from the total number of households located in Telesat's entire franchise area, there are still 158,829 households in Telesat's redefined franchise area. Applying the subscriber number to this figure yields a  Yb-revised penetration rate of 13.2 percent, resulting in a de minimis increase from its original penetration rate of 13.1 percent. While the County has demonstrated that Telesat has made an affirmative decision to redefine its service area, the record indicates that the resulting penetration rate still remains less than 30 percent.  Y-x8.` ` In the absence of a demonstration to the contrary, cable systems are presumed  Y-not to be subject to effective competition.g= Y-ԍ#Xw PE37=9XP# 47 C.F.R.  76.906.g The cable operator bears the burden of rebutting the presumption that effective competition does not exist with evidence that effective competition, as defined by Section 76.905 of the Commission's rules, is present within its  Y-franchise area.m= Y!-ԍ#Xw PE37=9XP# 47 C.F.R.  76.911(b)(1).m Telesat has met this burden.` = Y#-ԍ We draw no conclusion as to whether Telesat has provided the Commission with sufficient evidence alleging effective competition based on the competing provider test. Communications Act of 1934  623(l)(1)(B), 47 U.S.C.  543(l)(1)(B); 47 C.F.R.  76.905(b)(2). We recognize that there are five multichannel video programming distributors within Orange County. However, to date, the Bureau has not been asked to determine that"J'0*((u'" competition exists within the franchise area due to their presence. Should any of the operators submit new pleadings alleging effective competition under this second test, it will be considered at that time. Telesat appropriately relied on data"K0*((}"  Y-reflecting the number of households as required by our rules.K= Y-ԍ #Xw PE37=9XP#Third Recon. Order, supra note 10.#x6X@`7>FX@#Ѡ Relying on this data, Telesat has submitted sufficient evidence demonstrating that its cable system, serving Orange  Y-County, its franchise area, serves 21,031J= Y -ԍ Telesat operates three separate systems within its Orange County franchise. For purposes of its effective competition claim, Telesat has consolidated its subscribership for all three systems. Our rules require that if an operator has more than one system within a single franchise area, the operator should make separate effective competition claims for each  Y% -individual system. Rate Order at 5672. However, because each of Telesat's separate claims would necessarily result in individual penetration rates that are lower than the overall penetration rate claimed for the consolidated systems, we will accept Telesat's filing for review and decide its claim based on the information provided. of the 158,829 households, or 13.2 per cent of the households, within its franchise area. Thus, we find that Telesat's system serving Orange  Y-County is subject to effective competition.o= Ye-ԍ We note that two other operators, Cablevision Industries (CVI) and Hunter's Creek Cablevision have also filed petitions for revocation of the County's certification to regulate  Y7-basic rates and associated equipment. See Cablevision Industries, et. al., Petition for  Y"-Revocation of Certification of Orange County, Florida to Regulate Basic Cable Service Rates,  Y -DA 95179 (released February 8, 1995), Hunter's Creek Communications, Petition for  Y-Revocation of Certification of Orange County, Florida to Regulate Basic Cable Service Rates, DA 95178 (released February 8, 1995). Because each operator, including Telesat, was granted an identical franchise to serve the unincorporated areas of Orange County, we would expect that the reference to the total number of households in the franchise area would also be identical in each operator's filing. However, CVI asserts in its filing that there are 120,999 total households in its franchise area, whereas Telesat asserts that there are 160,356. Each operator is able to demonstrate how it arrived at its numbers and we are unable to conclude that one number is more accurate than the other. We therefore note that Telesat would meet the low penetration test for effective competition using either the household figures presented in its own petition or the figures presented in CVI's petition. If the household figure (120,999) used in CVI's petition is applied to the number of subscribers Telesat has (21,031), Telesat's penetration level would be 17.4 percent.o Accordingly, its petition is granted.  Xv- III. ORDERING CLAUSES  YH-x9.` ` Accordingly, IT IS SO ORDERED that the petition for reconsideration filed by Telesat Cablevision, Inc. challenging the certification of Orange County, Florida to  Y -regulate Telesat's basic service cable rates IS GRANTED. " Y0*(( "Ԍ  Yv-x10.` ` IT IS FURTHER ORDERED that the certification of Orange County to regulate the rates for basic cable service and associate equipment of Telesat Cablevision, Inc.  XI- IS RESCINDED.   Y -x11.` ` This action is taken pursuant to delegated authority under Section 0.321 of the Commission's Rules, 47 C.F.R.  0.321. x` `  hhFEDERAL COMMUNICATIONS COMMISSION x` `  hhMeredith J. Jones x` `  hhChief, Cable Services Bureau