WPClm 2MB%RK<3|X Times New RomanTimes New Roman BoldP\  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+SS88WuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNr >  6> z t> >r  Z > 6>z  z $ >   >z2 CKZ7 3|aTimes New RomanTimes New Roman BoldTimes New Roman ItalicSymbol"i~'^:DPddDDDdp4D48dddddddddd88pppX|pDL|pp||D8D\dDXdXdXDdd88d8ddddDL8ddddX`(`lD4l\DDD4DDDDDDDDd8XXXXXX|X|X|X|XD8D8D8D8ddddddddddXdbdddpdXXXXXlX~|X|X|X|XdddldldD8DdDDDdplld|8|P|D|D|8dvddddDDDpLpLpLpl|T|8|\ddddddl|X|X|Xd|DdpL|Dd~4ddC$CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxH\dDXddddd8@d<@d<DDXXdDDxddzHxxHvppDXd<"dxtldpxxdHP LaserJet 4Si (Add) 2033 RM 704HPLA4SAD.PRSX\  P6G;\"aKP2> X] K K I. A. 1. a.(1)(a) i) a) 1. 1. 1. a.(1)(a) i) a)Ң1y.X80,X\  P6G;P27jC:,9Xj\  P6G;XP32a=5,&a\  P6G;&P2e=5,&e4  pG;&d|DdpL|Dd~4ddC$CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxH\dDXddddd8@d<@d<DDXXdDDxddzHxxHvppDXd<"dxtldpxxd"i~'^5>I\\>>>\g0>03\\\\\\\\\\33gggQyyrg>Frgygrr>3>T\>Q\Q\Q>\\33\3\\\\>F3\\\\QX%Xc>0cT>>>0>>>>>>>>\3QQQQQwyQrQrQrQrQ>3>3>3>3\\\\\\\\\\Q\Z\\\g\QQQyQyQycyQtrQrQrQrQ\\\c\c\>3>\>>>\gcc\r3rIr>r>r3\l\\\\y>y>y>gFgFgFgcrMr3rT\\\\\\crQrQrQ\r>\gFr>\t0\\=!=WxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNBnnBT\>Q\\\\\3;\7;\7>>QQ\??n\\pBnnBmgg>Q\7"yyyy\njc\gnn\"i~'^5>g\\>>>\g0>03\\\\\\\\\\>>ggg\yyrF\yrgyy>3>j\>\gQgQ>\g3>g3g\ggQF>g\\\QI(I_>0_j>>>0>>>>>>\>g3\\\\\QyQyQyQyQD3D3D3D3g\\\\gggg\\g\\\\pg\\\QQ_QyQyQyQyQ\\\_\gjF3FgF>Fgg__gy3ySy>yIy3ggg\\QQQgFgFgFg_y^y>yjgggggg_yQyQyQgy>ggFy>\0\\=2=WxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNBnnBa\>\\\\\\7>\7>\7>>\\\??n\\pBnnBsgg>\\7"yyyy\nlc\gnn\2KpKKKQ"i~'^'-5CCph---CK#-#%CCCCCCCCCC%%KKK;{`XX`SK``-3`Su``K`XKS``}``S-%-=C-;C;C;-CC%%C%hCCCC-3%CC`CC;@@H-#H=---#--------C%`;`;`;`;`;uWX;S;S;S;S;-%-%-%-%`C`C`C`C`C`C`C`C`C`C`;`C`A`C`C`CKC`;`;`;X;X;XHX;`TS;S;S;S;`C`C`C`H`C`H`C-%-C---C]KHH`CS%S5S-S-S%`CO`C`C`C`Cu`X-X-X-K3K3K3KHS8S%S=`C`C`C`C`C`C}``HS;S;S;`CS-`CK3S-`CT#CC,,W]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]]xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN0PP0=C-;CCCCC%+eeC(+eeCe(--;;C..PCCQe0PP0OooKK-;Cp("XXXXee{CePMHCKPPC"i~'^09]SS999S]+9+/SSSSSSSSSS99]]]Sxnxxng?Snxgx]nxxxxn9/9aS9S]I]I9S]/9]/]S]]I?9]SxSSIC%CW9+Wa999+999999S9]/xSxSxSxSxSxxInInInInI>/>/>/>/x]SSSSx]x]x]x]xSxSx]SSxSxSf]xSxSxSxIxIxWxIx{nInInInISSSWS]a?/?]?9?]]WW]n/nKn9nCn/x]xx]x]SSxxIxIxI]?]?]?]WnUn9nax]x]x]x]x]x]xxWnInInIx]n9x]]?n9xSz+SS8-8WuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN%7777777777>>>0eOIIOD>OO%*ODaOO>OI>DOOgOOD%%37%07070%777V7777%*77O77055;%;3%%%%%%%%%%%7O0O0O0O0O0aHI0D0D0D0D0%%%%O7O7O7O7O7O7O7O7O7O7O0O7O6O7O7O7>7O0O0O0I0I0I;I0OED0D0D0D0O7O7O7O;O7O;O7%%7%%%7M>;;O7DD,D%D%DO7AO7O7O7O7aOI%I%I%>*>*>*>;D.DD3O7O7O7O7O7O7gOO;D0D0D0O7D%O7>*D%O7E77%%WMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN(BB(37%07777j7#TT7!#TT7T!%%007n&&Bn77lCTn(nBB(A\\>>n%07\n!"IIIITTenn7TnB@;7>lBBn7"i~'^"(22TN"""28"2222222222888,\HBBH>8HH"&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""A.SSxSSJR"RNOdxSxS8JSVSSSSS;88VVS++SSfSSxSc]]8VS;"xxSxxqS]^^^z0^88^^^zxzzzggx8E]S^/zU*FJSvggxxxxxzzzzKxggqU^^^zxxxxzzK|lr]f]oJiSfM`xJ.+fS{Sc|YoS`x^_^eSSiJxJofx]fff|i8Sxxf`lrf88SSS]SdaZSqddS"i~'^5>M\\>>>\}0>03\\\\\\\\\\>>}}}\rryrr>Qygyrr\grrggF3FM\>\\Q\Q3\\33Q3\\\\FF3\QyQQFI3Ic>0cM>>>0>>>>>>\>\3r\r\r\r\r\yyQrQrQrQrQ>3>3>3>3y\\\\\\\\\gQr\\\\gQ\r\r\r\r\yQyQycyQnrQrQrQrQ\\\c\c\>3>\>>>\\ccyQg3gBg>g;g3y\jy\y\\\yrFrFrF\F\F\FccgBg3gM\\\\\\ygcgFgFgF\g>y\\Fg>g\n0\\=(=WddddddddddddddddddddddddddddddddddddddddNBnnB_\F\\\\\\3;\7;\7>>gg\??n\\pBnnBb\\>g\7"yyyy\njc\}nn\2iK]K_,bZJd"i~'^:DTddDDDd4D48ddddddddddDDd||||DXp||dp||ppL8LTdDddXdX8dd88X8ddddLL8dXXXLP8PlD4lTDDD4DDDDDDdDd8|d|d|d|d|dX|X|X|X|XD8D8D8D8dddddddddpX|ddddpXd|d|d|d|dXXlXx|X|X|X|XdddldldD8DdDDDddllXp8pHpDp@p8dtdddd|L|L|LdLdLdLllpHp8pTddddddplpLpLpLdpDddLpDpdx4ddC,CWddddddddddddddddddddddddddddddddddddddddNHxxHhdLdddddd8@d<@d<DDppdDDxddzHxxHkddDpd<"dxtldxxd"i~'^#)0<A.SSxSSJR"RNOdxSxS8JSVSSSSS;88VVS++SSfSSxSc]]8VS;"xxSxxqS]^^^z0^88^^^zxzzzggx8E]S^/zU*FJSvggxxxxxzzzzKxggqU^^^zxxxxzzK|lr]f]oJiSfM`xJ.+fS{Sc|YoS`x^_^eSSiJxJofx]fff|i8Sxxf`lrf88SSS]1y.X80,X\  P6G;P27jC:,9Xj\  P6G;XP32a=5,&a\  P6G;&P42e=5,&e4  pG;&5a$G,',G\  P6G;P6y.\80,T\4  pG;P:% ,J:\  P6G;JPP:% ,1J:\  P6G;JPH5!,,5\  P6G;,P\{,W80,%W*f9 xr G;X\0_=5,% &_*f9 xr G;&X\5hC:,%Xh*f9 xr G;XXW!@(#,9h@\  P6G;hPy.V80,<V\  PAPx" M Times New Roman68WP MathA.8WP ArabicScrip28m\i/Z1y.X80,X\  P6G;P 27jC:,9Xj\  P6G;XP32a=5,&a\  P6G;&P42e=5,&e4  pG;&5a$G,',G\  P6G;P6y.\80,T\4  pG;7P:% ,J:\  P6G;JP8H5!,i,5\  P6G;,P\9{,W80,%0W*f9 xr G;Xy.V80,<UV\  PAP2jm S- X   P S- #Xj\  P6G;9XP##&a\  P6G;&P# Federal Communications Commission`}(#DA 972688 ă  yxdddy PQ aE#G\  P6G;P#QՊ#&a\  P6G;&P#vK #X\  P6G;P#Before the Federal Communications Commission  yO}"Washington, D.C. 20554 #&a\  P6G;&P#у   S@-In the Matter of: hh,V)CSR 5105E  S-` `  hh,V)  S-TCI TKR of Alabama, Inc.hh,V)Montgomery, AL  S-` `  hh,V)CUID No. AL0147 ` `  hh,V)  Sx-Petition for Special Reliefhh,V)  SP-#Xj\  P6G;9XP##&a\  P6G;&P#  S -  MEMORANDUM OPINION AND ORDER lU  S - Adopted: December 23, 1997V  ppReleased: December 24, 1997 By the Acting Chief, Cable Services Bureau:   S- I.INTRODUCTION  S-  1.` ` TCI TKR of Alabama, Inc. ("TCI") has filed a Petition for Special Relief seeking a   determination of effective competition. TCI asserts that it is subject to effective competition in   Montgomery, Alabama because of the presence of KNOLOGY of Montgomery's cable service in that City. This petition is unopposed. For the reasons discussed below, the Petition is granted.  S-  2.` ` The Communications Act of 1934, as amended ("Communications Act") provides that only  S-  the rates of cable systems that are not subject to effective competition may be regulated.F~ {O8-  #X\  P6G;P#эPub. L. No. 102385, 106 Stat. 1460 (1992); Communications Act  623(a)(2), as amended, 47 U.S.C.   {O-543(a)(2) (1992).  See also 47 C.F.R. 76.905(a). The Act permits   [local franchising authorities to become certified to regulate the basic cable service rates of cable operators  S-  that do not face effective competition.$F~ {OD-ԍCommunications Act 623(a)(3) and (a)(4), 47 U.S.C. 543(a)(3) and (4). See also 47 C.F.R. 76.910. The Commission's rules presume that effective competition does  SX-  not existdXF~ yO-#X\  P6G;P#э47 C.F.R. 76.906.d and place the burden on the cable operator to show that it does face effective competition in a  S0-  given franchise area.U0FF~ {O!-  #X\  P6G;P#эSee Report and Order in MM Docket No. 92266, Implementation of Sections of the Cable Television Consumer  {O!-Protection and Competition Act of 1992, 8 FCC Rcd 5631, 5669 (1993). See also 47 C.F.R. 76.911(b)(1).U Cable operators must prove that they are subject to effective competition under one  S-of the four tests set forth in Section 76.905(b) of the Commission rules.@F~ yOJ$-ԍ47 C.F.R. 76.905(b).@ "2 ,((88/"Ԍ S-  3.` ` One basis upon which a cable system may be deemed subject to effective competition is  S-  the competing provider test._2 yO@-ԍ47 U.S.C. 543(l)(1)(B); 47 C.F.R. 76.905(b)(2)._ Under the competing provider test, a cable system is subject to effective   competition if the franchise area is (1) served by at least two unaffiliated multichannel video programming  S-  distributors ("MVPD") each of which offers comparable programmingX2 yO-  >ԍFor this test, programming is considered "comparable" if it consists of "at least 12 channels of video programming, including at least one channel on nonbroadcast service programming." 47 C.F.R. 76.905(g).  to at least 50 percent of the   >households in the franchise area; and (2) the number of households subscribing to multichannel video  S8-programming other than the largest MVPD exceeds 15 percent of the households in the franchise area._82 yO -ԍ47 U.S.C. 543(l)(1)(B); 47 C.F.R. 76.905(b)(2)._  S-  34.` ` Alternatively, a cable system may be deemed subject to local exchange carrier ("LEC")  S-  effective competition, as defined in Section 623(l)(1)(D) of the Communications Act. @2 yO-  ԍ47 U.S.C.(1)(l)(D). The LEC effective competition test was adopted by Congress as part of the Telecommunications Act of 1996, Pub. L. No. 104104, 100 Stat. 56 (1996). Section 623(l)(1)(D) provides that a cable system is subject to LEC effective competition where:  Xa local exchange carrier or its affiliate (or any multichannel video programming distributor  %using the facilities of such carrier or its affiliate) offers video programming services  directly to subscribers by any means (other than directtohome satellite services) in the  franchise area of an unaffiliated cable operator which is providing cable service in that  pfranchise area, but only if the video programming services so offered in that area are  S - comparable | 2 yO-  ЍThe Commission observed that Congress specified a different definition of comparable programming for the   LEC effective competition test from that adopted for the other three effective competition tests. Although soliciting   <comment as to the revised definition, the Commission on an interim basis determined that it will apply this new   comparable programming standard which "includes access to at least 12 channels of programming, at least some of  {O-  which are television broadcasting signals" to the LEC effective competition test. See Implementation of Cable Act  {O-  Reform Provisions of the Telecommunications Act of 1996, 11 FCC Rcd 5937, 5942 (1996) (quoting 1996 Act Conference Report, S. Rep. 104230 at 170 (Feb. 1, 1996)). to the video programming services provided by the unaffiliated cable operator in that area.  47 U.S.C. 543(l)(1)(D).  S- II.THE PLEADINGS  Sh-  P5.` ` TCI states that it is subject to effective competition under the competing provider test set   forth in Section 623(l)(1)(B) of the Communications Act due to the presence of KNOLOGY of   Montgomery ("KNOLOGY"), a competing franchised cable operator in its Montgomery, Alabama  S-  -franchise area. 2 yOl&-  ԍThe City of Montgomery awarded a cable franchise to KNOLOGY on March 6, 1990. Petition for Special Relief ("Petition") filed by TCI on Sept. 23, 1997 at 6. To demonstrate that the first prong of the competing provider test is satisfied, TCI asserts"4 ,p(p(88%"  S-  that it passes all of the 84,573 occupied, nonseasonal housing units in Montgomery, 2 yOh-  ԍTCI states that it obtained this household count from the Planning Department for the City of Montgomery. Petition at 12. and estimates that  S-  KNOLOGY passes approximately 44,000 (or 52 percent)x 2 yO-ԍ44,000 households  84,573 households in franchise area = 52 percent passage.x of the households. TCI adds that both   [KNOLOGY and it meet the relevant programming comparability criterion because each offers at least 12   ]channels of video programming, at least one of which is nonbroadcast programming. In regards to   Ksatisfaction of the second prong of the competing provider test, TCI contends that KNOLOGY, the smaller  S8-  MVPD of the two systems, has approximately 16,530 subscribers, or 20 percent penetration,}82 yO -ԍ16,530 subscribers  84,573 households in franchise area = 20 percent penetration.} which exceeds the 15 percent penetration requirement.  S-  6.` ` TCI asserts that, in the alternative, it is subject to LEC effective competition. With   regard to the LEC affiliation requirement, TCI asserts that KNOLOGY is whollyowned by KNOLOGY   Holding, Inc. which, in turn is 29 percent owned by ITC Holdings, Inc. ("ITC Holdings"). ITC Holdings,   .notes TCI, wholly owns Interstate/Valley Telephone Company ("IVT"), a local exchange carrier serving   customers in Alabama and Georgia. TCI argues that through their common parent company, KNOLOGY and IVT are affiliates for purposes of the LEC effective competition test.  S -  7.` ` With regard to the requirement that the LEC competitor offer video programming service   in the unaffiliated cable operator's franchise area, TCI asserts that KNOLOGY has completed an overbuild   Lof more than 52 percent of the City of Montgomery and is committed to pass all households in the City   by July, 1999. TCI believes that KNOLOGY is now providing service to more than 16,530 customers   and can provide service to potential subscribers in Montgomery with only minimal additional investment.   TCI adds that KNOLOGY has heavily marketed the availability of its cable service through local media   /and other means. TCI asserts there are no regulatory, technical, or other impediments to households taking service from KNOLOGY. XX` ` `  S@-  R8.` ` TCI also asserts that KNOLOGY offers comparable programming to Montgomery   subscribers. Specifically, TCI provides KNOLOGY's channel lineup which demonstrates that   zKNOLOGY offers over 70 channels, of which at least 6 are local television broadcasting signals. TCI   offers 60 channels of programming in Montgomery, of which at least 6 are local television broadcast signals.  SP- III.ANALYSIS  S-  9.` ` In the absence of a demonstration to the contrary, cable systems are presumed not to be  S-  subject to effective competition as defined in the Communications Act.=@2 yO#-ԍ47 C.F.R. 76.906.= The cable operator bears the   Mburden of rebutting the presumption that such effective competition does not exist and must provide   Nevidence sufficient to demonstrate that effective competition, as defined by Section 76.905 of the",p(p(88"  S-  Commission's rules, is present in the franchise area.M2 yOh-Ѝ47 C.F.R. 76.911(b)(1).M TCI has met this burden by satisfying the   competing provider test for effective competition. In light of this finding, we will not address TCI's contention that it is also subject to effective competition under the LEC effective competition test.  S`-  10.` ` The first part of the competing provider test requires that the franchise area be served by   [at least two unaffiliated MVPDs, each of which offers comparable programming to at least 50 percent of   the households in the franchise area. We find that TCI has provided sufficient evidence demonstrating   that it is unaffiliated with KNOLOGY, and that both offer service to the requisite percentage of   households. TCI offers cable service to 100 percent of the households in the City of Montgomery  S-  franchise area.6X2 yO -ԍPetition at 5.6 KNOLOGY's service is technically available to 52 percent of households in the franchise   [area. With respect to the issue of programming comparability, we find that the programming of TCI and   kKNOLOGY is comparable because they offer at least 12 channels of video programming, including at  S -  least one nonbroadcast channel.J 2 {O-ԍSee 47 C.F.R. 76.905(g).J We conclude, therefore, that TCI has satisfied the first part of the competing provider test.  S -  o11.` ` The second part of the competing provider test requires that the number of households   =subscribing to KNOLOGY, the smaller of the two MVPDs, exceeds 15 percent of the households in the   franchise area. KNOLOGY serves 20 percent of households. We find that TCI has demonstrated that   KNOLOGY's penetration rate in the franchise area satisfies the requirement of the second prong of the   <competing provider test. We conclude that TCI has established that both prongs of the competing provider effective competition test have been met.  S- IV.ORDERING CLAUSES  Sh-  S@-  &12.` ` Accordingly, IT IS ORDERED that the Petition for Special Relief seeking a  S-determination of effective competition filed by TCI TKR of Alabama, Inc. IS GRANTED .  S-  13.` ` This action is taken pursuant to delegated authority under Section 0.321 of the  S-Commission's rules, as amended.;z2 yO-ԍ47 C.F.R 0.321.; ` `  hh,FEDERAL COMMUNICATIONS COMMISSION ` `  hh,William H. Johnson ` `  hh,Acting Chief, Cable Services Bureau