WPC, 2MBRK.3|wTimes New RomanCG Times#XP\  P6Q9XP#"i~'^09CSS999S]+9+/SSSSSSSSSS//]]]Ixnnxg]xx9?xgxx]xn]gxxxxg9/9MS9ISISI9SS//S/SSSS9?/SSxSSIP!PZ9+ZM999+99999999S/xIxIxIxIxIlnIgIgIgIgI9/9/9/9/xSxSxSxSxSxSxSxSxSxSxIxSxRxSxSxS]SxIxIxInInInZnIxigIgIgIgIxSxSxSxZxSxZxS9/9S999Su]ZZxSg/gCg9g9g/xSbxSxSxSxSxn9n9n9]?]?]?]ZgFg/gMxSxSxSxSxSxSxxZgIgIgIxSg9xS]?g9xSi+SS88WuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN8HH"&H>XHH8HB8>HH^HH>"".2",2,2,"222N2222"&22H22,006"6."""""""""""2H,H,H,H,H,XAB,>,>,>,>,""""H2H2H2H2H2H2H2H2H2H2H,H2H1H2H2H282H,H,H,B,B,B6B,H?>,>,>,>,H2H2H2H6H2H6H2""2"""2F866H2>>(>">">H2;H2H2H2H2XHB"B"B"8&8&8&86>*>>.H2H2H2H2H2H2^HH6>,>,>,H2>"H28&>"H2?22!!WFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN$<<$.2",2222`2 LL2 LL2L"",,2d"""  X-overtheair and cable television viewing are included."< yOy- xxԍ Certain counties are divided into more than one sampling unit because of the topography involved. Also, in  xcertain circumstances, a station may have its home county assigned to an ADI even though it receives less than a  {O - xpreponderance of the audience in that county. Refer to Arbitron's Description of Methodology handbook for a more complete description of how counties are allocated.  X-  03.xUnder the Act, however, the Commission is also directed to consider changes in market areas. Section 614(h)(1)(C) provides that the Commission may: . xwith respect to a particular television broadcast station, include additional xcommunities within its television market or exclude communities from such xstation's television market to better effectuate the purposes of this section. In considering such requests, the Act provides that: xthe Commission shall afford particular attention to the value of localism by xtaking into account such factors as x(I) whether the station, or other stations located in the same area, have been xhistorically carried on the cable system or systems within such community; x(II) whether the television station provides coverage or other local service to xsuch community; x(III) whether any other television station that is eligible to be carried by a cable xsystem in such community in fulfillment of the requirements of this section xprovides news coverage of issues of concern to such community or provides xcarriage or coverage of sporting and other events of interest to the xcommunity; and x(IV) evidence of viewing patterns in cable and noncable households xwithin the areas served by the cable systems or systems in such  X|-xcommunity.|< yO-ԍCommunications Act of 1934, as amended, 614(h)(1)(C)(ii), 47 U.S.C. 534(h)(1)(C)(ii).  XN-4.xThe legislative history of this provision indicates that: xwhere the presumption in favor of ADI carriage would result in cable subscribers xlosing access to local stations because they are outside the ADI in which a local xcable system operates, the FCC may make an adjustment to include or exclude xparticular communities from a television station's market consistent with Congress' xobjective to ensure that television stations be carried in the areas which they serve" B,,(,([["Ԍxand which form their economic market.  X- x` ` * * * * * x x(This subsection) establishes certain criteria which the Commission shall consider xin acting on requests to modify the geographic area in which stations have signal xcarriage rights. These factors are not intended to be exclusive, but may be used  X_-xto demonstrate that a community is part of a particular station's market.Z_< yO-ԍH.R. Rep. No. 628, 102d Cong., 2d Sess. 97 (1992).Z  X1-5.xThe Commission provided guidance in its report and Order MM Docket 92  X -259, supra, to aid decision making in these matters, as follows:   !xFor example, the historical carriage of the station could be illustrated by the submission   ]xof documents listing the cable system's lineup (e.g., rate cards) for a period of years. To   !xshow that the station provides coverage or other local service to the community (factor   x2), parties may demonstrate that the station places at least a Grade B coverage contour xover the cable community or is located close to the community in terms of mileage. xCoverage of news or other programming of interest to the community could be   xdemonstrated by program logs or other descriptions of local program offerings. The final  XO-  xfactor concerns viewing patterns in the cable community in cable and noncable homes.   ]xAudience data clearly provide appropriate evidence about this factor. In this regard, we  X#-  xnote that surveys such as those used to demonstrate significantly viewed status could be   {xuseful. However, since this factor requires us to evaluate viewing on a community basis   >xfor cable and noncable homes, and significantly viewed surveys typically measure viewing   xonly in noncable households, such surveys may need to be supplemented with additional  X-xdata concerning viewing in cable homes.QX< yO-ԍ8 FCC Rcd at 2977 (emphasis in original).Q  X-6.xIn adopting rules to implement this provision, the Commission indicated that requested  xchanges should be considered on a communitybycommunity basis rather than on a countyby xcounty basis, and that they should be treated as specific to particular stations rather than  XT- xapplicable in common to all stations in the market.@T< yO -ԍ8 FCC Rcd at 2977 n.139.@ The rules further provide, in accordance with  xthe requirements of the 1992 Cable Act, that a station not be deleted from carriage during X&-the pendency of an ADI change request.<&x< yOO$-ԍ47 C.F.R. 76.59.<  X-  7.xAdding communities to a station's market generally entitles that station to insist on cable  xcarriage in those communities. However, this right is subject to several conditions: 1) a cable",,(,([[;"  xsystem operator is generally required to devote no more than onethird of the system's activated  X- xchannel capacity to compliance with the mandatory signal carriage obligations,M < {Ob-ԍSee 47 U.S.C. 534(b)(1)(B).M 2) the station is  X- xresponsible for delivering a good quality signal to the principal headend of the system,T Z< {O-ԍSee 47 U.S.C.  534 (h)(1)(B)(iii).T and 3)  xthe system operator is not required to carry the signal of any station whose signal substantially  xiduplicates the signal of any other local signal carried, or the signals of more than one local station  X- x\affiliated with a particular broadcast network.J < {O* -ԍSee 47 U.S.C. 534(b)(5).J If, pursuant to these requirements, a system  xoperator elects to carry only one such duplicating signal, the operator is obliged to carry the  xstation from the ADI whose city of license is closest to the principal headend of the cable  XH- xsystem.: H~< yOw-ԍ8 FCC Rcd at 2981.: Accordingly, depending upon the circumstances involved, the addition of communities  xzto a station's market may have the following consequences. It may guarantee than station's  xcarriage in the subject communities. Should there be more mustcarry stations that onethird of  xthe system's channel capacity, it would provide the system operator with an expanded list of  xmustcarry signals from which to choose. Should the station be a duplicating network station, it will determine which station has priority carriage in the subject communities added.  X-l  MARKET FACTS AND PETITIONER'S ARGUMENT ă  Xb-  8.xKDLT is licensed to Mitchell, South Dakota, which in turn, is located in the Sioux Falls XK- xMitchell, South Dakota ADI.s K< {O -ԍSee Arbitron's 19911992 Television ADI Market Guide, pp. 1259, 3304.s Vermillion provides cable service to Vermillion, South Dakota,  xwhich is in the Sioux City, Iowa ADI. KDLT requests modification of the Sioux FallsMitchell, South Dakota ADI to include the community of Vermillion.  X-  _9.x KDLT maintains that Vermillion illegally deleted KDLT from its channel lineup on  xOctober 1, 1996, after fifteen years of continuous carriage. KDLT states that Vermillion dropped  xits station without giving the required 30day advance written notice to the station, in direct  X- xviolation of 76.58(a) of the Commission's Rules..< yO!- xԍThe Commission's Rules require a cable system to "provide written notice to any broadcast television station  {O"-at least 30 days prior to either deleting from carriage or repositioning that station." See 47 C.F.R. 76.58(a).. KDLT asks that the Commission order  x[Vermillion to restore carriage of Station KDLT immediately, while its ADI modification petition  xzis being considered. Further, KDLT presents evidence that Vermillion should be included in  xStation KDLT's market, when considered under the four factor test set forth in Section  x=614(h)(1)(C)(iii) of the Communications Act. KDLT asserts that Station KDLT was included in  xVermillion's channel lineup as early as March 1, 1981, just three months after the cable franchise"7 ,,(,([["  xwas granted. KDLT states that other cable systems in Clay County have carried the station for  x!the past nine years and still do. KDLT argues that this history of carriage is entitled to  x[substantial weight and demonstrates that Vermillion's subscribers value Station KDLT and the  x]services that Station KDLT provides. KDLT further contends that the requested market  xmodification would facilitate continuation of the status quo which would benefit subscribers.  xMFurther, KDLT states that loss of cable viewer access to Station KDLT would cause viewer  xkdisruption; disruption which the statutory market modification provisions were designed to prevent.  X1-  O10.xIn addition to its long term carriage, KDLT points out the following: 1) KDLT carries  xlocal programming of interest to Vermillion's subscribers; 3) KDLT's has a high level of  xviewership in the community; and 4) Vermillion is currently considered by Nielsen to be in the  x!same Designated Market Area (DMA) as Station KDLT. Further, KDLT asserts that its  x-viewership in Clay County is demonstrated by the station's 10% total viewing hours and 45% net  X - x<weekly circulation reported for Clay County.f < {O7-ԍSee Nielsen's 1995 Diary County/Coverage Study, p. 3305.f This data, argues KDLT, demonstrates that Station  xLKDLT's programming, including extensive local service appeals, is watched by viewers in Clay  xCounty communities. Finally, KDLT asserts that Station KDLT's Grade B Contour completely encompasses all of Clay County.  XK-  11.xVermillion opposes KDLT's request to reinstate carriage of its signal during the pendency  xof this proceeding. Vermillion states that KDLT was well aware of its plans to delete the station  xin response to continuous subscriber complaints regarding Station KDLT's picture quality and the  x\duplication of broadcast programming between NBC affiliates KDLT and KTIVTV of Sioux  x City, Iowa. Vermillion also contends that numerous conversations between Vermillion and  xKDLT senior managers provided notice to KDLT of the ongoing signal quality problems and  x.Vermillion's concerns that continued carriage would affect its competitive position. Vermillion  xstates that after two years with no improvement in the signal quality and despite continuous  xassurances by KDLT executives that such improvements would be made, Vermillion dropped  xStation KDLT from its channel lineup on October 1, 1996, after giving thirty days' advance  x{written notice to its subscribers. While, it admits that formal written notification was not  x provided to KDLT, Vermillion asserts that KDLT was clearly aware of Vermillion's intent to  xdrop the signal. Vermillion contends that without KDLT's assurance that its signal would be improved, KDLT should not be allowed to benefit from Vermillion's tolerance.  x12. Vermillion states that KDLT's local programming is questionable, pointing out that bulk  x!of KDLT's local programming is news about the University of South Dakota. While the  xUniversity of South Dakota is located in Vermillion, Vermilloin maintains its programming can  xhardly be considered "local" to the City of Vermillion. Finally, Vermillion concedes that while  xkKDLT achieves high viewership percentages in Clay County, this does not detract from the popularity of the stations currently located in Vermillion's ADI. "h$Z,,(,([[F#"Ԍ X-  ^13.xKDLT asserts in its reply that Vermillion admits that it did not provide the mandatory  x[advance written notice to KDLT required by Section 76.58(a) before the station from its lineup.  xMKDLT further states that Vermillion's has submitted no evidence in support of its claim that  xKDLT's signal quality was unsatisfactory. Had Vermillion complied with its legal obligations,  X- xKKDLT points out that it would have been able to invoke its statutory rights to preserve the status  X- x=quo by filing its ADI modification request earlier. KDLT asserts that when it called Vermillion  xafter learning of the deletion, Vermillion stated it would now have to begin paying copyright  x>royalty fees to carry KDLT, and it simply did not want to incur that expense. KDLT further  xstates that it received a letter from Vermillion's counsel explaining why it was deleting Station  xKKDLT. That letter, states KDLT, says absolutely nothing about signal quality. Instead, the letter  X -explains why the system would have to begin paying copyright royalty fees.pX < yO - xԍNothing in the memorandum of Vermillion's counsel that was provided to KDLT provides any explanation as  xto why copyright payments, which are payable on a twice yearly basis, would cause the system to delete the signal of KDLT on October 1 without complying with the thirty day notice requirement.p  X -( DISCUSSION ă  X -  P14. xWe shall grant KDLT's petition for market modification. The evidence the station  xysubmits, evaluated pursuant to the four statutory and other relevant factors, persuades us that  xVermillion, South Dakota is properly considered part of KDLT's ADI. With regard to the first  xstatutory factor, we note that KDLT has demonstrated a history of carriage on the cable system  XO- xserving the community in question.O< yO-ԍKDLT was apparently carried by Vermillion for approximately 15 years prior to its deletion. A pattern of carriage, in the absence of a carriage  x[obligation, is a strong indication of interest in a signal and of the signal's market connection to  X!- xKthe communities in question.v!x< {OJ-ԍSee KTEN Television Limited Partnership, 11 FCC Rcd 10355, 10361 (1996).v Turning to the second statutory factor, we note that KDLT places  xLa Grade B contour of all of Clay County. We have stated previously that, as a general matter,  x Grade B coverage demonstrates service to cable communities and serves as a measure of a  X- x0station's natural economic market.\ < {O- xԍSee Broadcast Signal Carriage Issues, 8 FCC Rcd at 2977. See also Amendment of Section 76.51 (Orlando {Oa- xDaytona BeachMelbourneCocoa, Florida), 102 FCC 2d at 1070 ("We believe that television stations actually do or logically can rely on the area within their Grade B contours for economic support.") Moreover, KDLT's has demonstrated that it carries  x]programming relevant to Vermillion.. Contrary to Vermillion's statements, we believe that  xprogramming about the University of South Dakota, which is located in Vermillion, is locally  xoriented programming. Further, it is undisputed that KDLT's signal is receivable offtheair in  xVermillion. With regard to the third statutory factor whether other stations eligible to be  xycarried serve the communities in general, we do not believe that Congress intended this third  xKcriterion to operate as a bar to a station's ADI claim whenever other stations could also be shown  xto serve the communities at issue. Rather, we believe that this criterion was intended to enhance";. ,,(,([["  xa station's claim where it could be shown that other stations do not serve the communities at  x-issue. Under such circumstances, a denial of carriage rights to the claiming station could deprive  xcable viewers of any broadcast signals that might provide programming geared to their  x^communities. In this case, although Sioux City ADI stations also service Vermillion's  x[subscribers, this enhancement factor would not appear to be applicable. Turning to the fourth  xfactor, that of area viewing patterns, the Nielsen data which KDLT submits indicates that the  xstation has a significant share of viewing in Clay County which demonstrates a clear and  X_- x[substantial nexus between Clay County and KDLT. In fact, Nielsen's 1995 County/Coverage  XJ- xStudy indicates that KDLT's viewership levels exceeds all but two of the reported Sioux City  X5- xstations.:5< yO - xԍKDLT's reported shares are 10% share of total viewing hours and a net weekly circulation of 45%. The listed  xSioux City stations and their respective shares are: KCAU (10% total viewing share/83% net weekly circulation);  xKMEG (5% total viewing share/46% net weekly circulation); KSIN (2% total viewing share/32% net weekly  xcirculation); KTIV (15% total viewing share/77% net weekly circulation); and KXNE (only 16% share of net weekly circulation reported).: Furthermore, we note that the Commission has held that the fact that a station, such  xas KDLT, is located in the same DMA as a subject community would be given consideration in  X -ADI modification proceedings.{ x< {O0-ԍ Report and Order and Notice of Further Rulemaking,, 11 FCC Rcd. 6201 (1996).{  X -  15.xFinally, we find that Vermillion has presented no evidence of poor signal quality to  xsubstantiate its reason for deleting carriage of KDLT from its lineup without official notification.  x\Moreover, Vermillion has failed to present any evidence that KDLT does not meet all of the  xLcriteria pursuant to 614 of the Communications Act. We find, therefore, that Station KDLT is  xa qualified station entitled to carriage on Vermillion's cable system serving the community of  x0Vermillion, South Dakota located in Clay County, South Dakota. Moreover we find that  x>Vermillion apparently violated 76.58(a) and.76.964 of the Commission's rules by failing to  xprovide KDLT thirty days written notice of its intention to drop the station. In this regard,  x|Vermillion will be ordered to disclose the full circumstances of it apparent violation of  x76.58(a) and.76.964 of the Commission's rules within 30 thirty days of the release of this  xorder. Additionally, Vermillion will be required to commence carriage of KDLT within twenty  xL(20) days of the release date of this order. In this regard we will waive the notice provisions of of 76.58(a) and.76.964 of the Commission's rules  X-  ORDERING CLAUSES ă  XR-  16.xAccordingly, IT IS ORDERED, pursuant to 614(h) of the Communications Act of  x1934, as amended, 47 U.S.C.534 and 76.59 of the Commission's Rules, 47 C.F.R. 76.59, that  X$- x>the petition for special relief (CSR4877A) filed on behalf of Red River Broadcast Group IS  X - x.GRANTED , and Vermillion Cable TV IS ORDERED to commence carriage of Station KDLT  X- xtwenty (20) days after the release date of this ORDER. Station KDLT shall notify the relevant  x]cable system in writing of its carriage and channel position election ( 76.56, 76.57, and" ,,(,([["  X-76.64(f) of the Commission's Rules) within ten (10) days of the release date of this ORDER.  X-  N17. xIT IS ALSO ORDERED, that Vermillion shall provide a full explanation, within thirty  x\(30) days of the release date of this order, of the circumstances surrounding its dropping of station KDLT in apparent violation of  76.58(a) and 76.964 of the Commission's rules  Xv-  18.xThis action is taken pursuant to authority delegated by 0.321 of the Commission's Rules, 47.C.F.R. 0.321. x` `  hhFEDERAL COMMUNICATIONS COMMISSION x` `  hhWilliam H. Johnson x` `  hhDeputy Chief, Cable Services Bureau