NOTICE ************************************************************************* NOTICE ************************************************************************* This document was originally prepared in Word Perfect. If the original document contained-- * Footnotes * Boldface & Italics --this information is missing in this version The document format (spacing, margins, tabs, etc.) is changed too. If you need the complete document, download the Word Perfect version. For information about downloading documents (FTP) see file pnmc5021. File pnmc5021 (.txt & .wp) is in directory \pub\Public_Notices\Miscellaneous. ************************************************************************* Before the Federal Communications Commission Washington, D.C. 20554 In re Applicatio n of) ) CINCINNATI TV 64 ) LIMITED PARTNERSHIP ) (Assignor) ) ) and ) File No. BALCT-960205IB ) File No. BALTT-960205IC WSTR LICENSEE, INC. ) (Assignee) ) ) ) For Assignment of Licenses of Stations:) WSTR-TV, Cincinnati, Ohio ) W66AQ, Dayton, Ohio ) MEMORANDUM OPINION AND ORDER Adopted: July 8, 1996 Released: July 16, 1996 By the Commission: 1. The Commission has before it for consideration Cincinnati TV 64 Limited Partnership's above-captioned, unopposed application to assign the licenses of television station WSTR-TV, Channel 64 (IND), Cincinnati, Ohio and television translator station W66AQ, Dayton, Ohio to WSTR Licensee, Inc. ("Sinclair"), a wholly owned subsidiary of Sinclair Broadcast Group, Inc. ("SBG"). SBG is also the licensee of WDKY-TV, Channel 56 (FOX), Danville, Kentucky. Because WSTR-TV and WDKY-TV have overlapping Grade B service contours, Sinclair requests a permanent waiver of Section 73.3555(b), the Commission's duopoly rule, which generally prohibits common ownership or control of television stations with overlapping Grade B contours. Waiver Request 2. According to Sinclair's engineering exhibit, the intersecting Grade B service contours of WSTR-TV and WDKY-TV create an overlap area measuring 525.3 square kilometers and encompassing 5,489 persons. This constitutes 0.19% of the population and 2.22% of the area within WSTR-TV's Grade B service contour and 0.75% of the population and 2.95% of the area within WDKY-TV's Grade B service contour. While acknowledging that these overlap percentages slightly exceed the 1% de minimis standard, Sinclair asserts that they do not require a finding that the stations "serve substantially the same area" based on past Commission decisions. 3. Sinclair asserts that the overlap area is well-served by a diversity of programming sources because seven other commercial television stations provide Grade B coverage to the entire overlap area. Further, Sinclair pledges that the stations, "will continue to provide significant amounts of separate local programming addressing the specific needs of the stations' respective communities and markets" and states that WDKY-TV is affiliated with Fox while WSTR-TV is independently programmed. Pledging that "[b]oth stations will continue to maintain autonomous operations," Sinclair states that each station will employ separate management staff and separate staff-level employees. Additionally, Sinclair characterizes the station's markets as "highly competitive" and "separate and distinct . . . each with its own unique service needs" and notes that the stations are located in communities approximately 125 miles apart. According to Sinclair, WSTR-TV is licensed to Cincinnati, the nation's 29th largest DMA, and WDKY-TV is licensed to Danville, a community within the Lexington, Kentucky DMA, the nation's 68th largest DMA. Sinclair reports that both DMA's have a full complement of network-affiliated stations (ABC, CBS, NBC, Fox), four educational stations, and an independent station, with Lexington also having an additional CBS affiliate and an additional independent station (not yet on the air). Also, 20 cable systems, averaging approximately 39 channels of programming, serve the counties comprising the Cincinnati metro market and 11 cable systems, averaging approximately 38 channels of programming, serve the counties comprising the Lexington metro market. Sinclair asserts that, even with Sinclair's common ownership of WSTR-TV and WDKY-TV, these two markets will retain a high level of broadcast ownership diversity with 27 different owners for the 32 commercial radio stations and the 9 television stations in the Cincinnati market, and 18 different owners for the 19 commercial radio and the 11 television stations in the Lexington market. 4. As public interest benefits, Sinclair commits that "each [station] will produce and broadcast one additional hour of local non-entertainment programming above and beyond the amount currently being offered by the station. This additional non-entertainment programming will be specifically geared to the needs and concerns of the station's individual television market. Furthermore . . . both WSTR-TV and WDKY-TV will air 'Take One,' a weekly 30-minute, local children's program currently being co-produced by several Sinclair stations. WSTR-TV and WDKY-TV each will produce and contribute segments to this program that are directed to the interests of children in the Cincinnati and Lexington markets, respectively." Discussion 5. In adopting the duopoly rule's fixed standard of prohibiting overlap of Grade B service contours, the Commission also acknowledged the need for "flexibility" in that rule's application, noting that waivers should be granted where rigid conformance to the rule would be "inappropriate." Multiple Ownership of Standard, FM and Television Broadcast Stations (Multiple Ownership), 45 FCC 2d 1476 n.1, recon. granted in part, 3 RR 2d 1554 (1964). To that end, the Commission has developed a set of factors to be considered when evaluating an applicant's request for waiver of the duopoly rule, including the extent of the overlap, the number of media voices available in the overlap area, the distinctness of the respective markets, the independence of the stations' operations, and the concentration of economic power resulting from the combination. See Iowa State University Broadcasting Corporation, 9 FCC Rcd 481, 487-88 (1993), aff'd sub nom. Iowans for WOI-TV, Inc. v. FCC, 50 F.3d 1096 (D.C. Cir. 1995); H&C Communications, Inc., 9 FCC Rcd 144, 146 (1993). After weighing the factors, the Commission considers any public interest benefits proposed by the applicant to determine whether, in light of the overlap, the benefits outweigh any detriment which may occur from grant of the waiver. See, e.g., Iowa State University, 9 FCC Rcd at 487-88. As with any waiver, it will only be granted if the Commission concludes that the waiver is in the public interest. It is against this standard that we will evaluate Sinclair's request for a permanent waiver. 6. Balancing those factors in this case, we find that waiver of the duopoly rule is amply justified. Preliminarily, the percentages of population overlap -- 0.19% for WSTR-TV and 0.75% for WDKY-TV -- are both within the 1% de minimis standard we have applied in duopoly cases. Hubbard Broadcasting, Inc., 2 FCC Rcd 7374 (1987). The percentages of area overlap -- 2.22% for WSTR-TV and 2.95% for WDKY-TV -- fall well within the range of overlap percentages previously sanctioned by the Commission. See, e.g., WHTM-TV, Inc., FCC 96-77 (released February 29, 1996)(overlap area comprised 3.79% of the population and 5.2% of the area within the Harrisburg, Pennsylvania television station's market and 1.04% of the population and 4.06% of the area within the Washington, DC television station's market); Citadel Communications Company, Ltd., 10 FCC Rcd 11910 (1995)(overlap area comprised 1.27% of the population and 3.5% of the area within the Lincoln, Nebraska television station's Grade B service contour and 1.31% of the population and 2.8% of the area within the Sioux City, Iowa television station's Grade B service contour); WROC Associates, 10 FCC Rcd 11094 (1995)(overlap area comprised 0.5% of the population and 2.8% of the area within the Rochester, New York television station's Grade B service contour and 1.6% of the population and 3.5% of the area within the Elmira, New York television station's Grade B service contour); and H&C Communications, Inc., 9 FCC Rcd at 144 (overlap area comprised 1.0% of the population and 2.6% of the area within the Des Moines, Iowa television station's Grade B service contour and 0.8% of the population and 3.3% of the area within the Omaha, Nebraska television station's Grade B service contour). Thus, we conclude that the overlap area does not justify a finding that the stations "serve substantially the same area." 7. The level of alternative media serving the overlap area ensures that viewers will continue to receive a diversity of programming choices and falls within the range of past Commission decisions involving comparable overlap percentages. In addition to the independently-programmed WSTR-TV and the Fox-affiliated WDKY-TV, the overlap area receives programming from two ABC affiliates, two CBS affiliates and three NBC affiliates. Moreover, Sinclair has pledged to supply separate local programming for each market. Responding to our concerns about the possibility of diminution of competition, Sinclair has pledged that the stations will "continue to maintain autonomous operations" and will employ separate management and staff. We also note that the stations are located in separate DMA's, as WSTR-TV competes in Cincinnati, the nation's 29th largest market, and WDKY-TV competes in Lexington, the nation's 68th largest market. Thus, we find that the concentration of economic power resulting from this duopoly waiver will be minimal. 8. Turning to the public interest benefits proposed by the applicant, Sinclair's commitments to "produce and broadcast one additional hour of local non-entertainment programming above and beyond the amount currently being offered . . . [and to] air . . . a weekly 30-minute, local children's program" are public interest benefits which the Commission has found tilt the balance in favor of granting a duopoly waiver. See, e.g., H&C Communications, Inc., 9 FCC Rcd at 146. In sum, we conclude that the public interest benefit gained from this waiver outweighs any detriment resulting from the small overlap. 9. Having determined that the applicant is qualified in all respects, we conclude that grant of the instant application would serve the public interest, convenience and necessity. 10. Accordingly, IT IS ORDERED, that the request for permanent waiver of the Commission's duopoly rule, Section 73.3555(b), to permit the common ownership of television stations WSTR-TV and WDKY-TV, IS GRANTED and that the applications for assignment of licenses of WSTR-TV, Cincinnati, Ohio (File No. BALCT-960205IB) and W66AQ, Dayton, Ohio (File No. BALTT-960205IC) to WSTR Licensee, Inc. ARE GRANTED. FEDERAL COMMUNICATIONS COMMISSION William F. Caton Acting Secretary