WPC5g 2a BK Z CG Times3|jTimes New Roman Bold P6G;XPTimes New RomanB^ 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 4M (PCL)HPLA4MPC.PRSXj\  P6G;\"CXP2<  Z KB Times New RomanTimes New Roman BoldTimes New Roman Italic=!XP#3|j%HP LaserJet 4 room 702 LPT2HPLA4ADD.PRSXj\  P6G;\K"YWXP"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$CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxH\dDXddddd8@d<@d<DDXXdDDxddzHxxHvppDXd<"dxtldpxxd2K vp "i~'^09CSS999S]+9+/SSSSSSSSSS//]]]Ixnnxg]xx9?xgxx]xn]gxxxxg9/9MS9ISISI9SS//S/SSSS9?/SSxSSIP!PZ9+ZM999+99999999S/xIxIxIxIxIlnIgIgIgIgI9/9/9/9/xSxSxSxSxSxSxSxSxSxSxIxSxRxSxSxS]SxIxIxInInInZnIxigIgIgIgIxSxSxSxZxSxZxS9/9S999Su]ZZxSg/gCg9g9g/xSbxSxSxSxSxn9n9n9]?]?]?]ZgFg/gMxSxSxSxSxSxSxxZgIgIgIxSg9xS]?g9xSi+SS88WuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNiLheader;Ax 4 <D  #FxX  Pg9CXP# reference<;#FxX  Pg9CXP#itemizeX1=&V 8F ` hp xr#FxX  Pg9CXP#header2>I ` hp x`    #FxX  Pg9CXP# 2R?^/N@OOA PBQheading 3?F` hp x #FxX  Pg9CXP# footer!@!!#d\  PCP#CitatorFormat Secretary's Citator Output FileAW r5-#d6X@`7Ͽ@# XX  X B r5-S  BFormat DownloadFormat Downloaded DocumentBiޛ r5- XX    \ #d6X@`7Ͽ@#2ZXRX4SKUKWTimes New RomanTimes New Roman BoldTimes New Roman ItalicTimes New Roman Bold Italic87jC:, Xj\  P6G;XP9y.X80,IX\  P6G;P:7nC:,Xn4  pG;Xy.\80, [\4  pG;pDppLDd4ddC6CWxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxNHxxHjdDdddddd/>/>/>/x]SSSSx]x]x]x]xSxSx]SSxSxSf]xSxSxSxIxIxWxIx{nInInInISSSWS]a?/?]?9?]]WW]n/nKn9nCn/x]xx]x]SSxxIxIxI]?]?]?]WnUn9nax]x]x]x]x]x]xxWnInInIx]n9x]]?n9xSz+SS8-8WuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuuxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN8HH"&H>XHH8HB8>HH^HH>"".2",2,2,"222N2222"&22H22,006"6."""""""""""2H,H,H,H,H,XAB,>,>,>,>,""""H2H2H2H2H2H2H2H2H2H2H,H2H1H2H2H282H,H,H,B,B,B6B,H?>,>,>,>,H2H2H2H6H2H6H2""2"""2F866H2>>(>">">H2;H2H2H2H2XHB"B"B"8&8&8&86>*>>.H2H2H2H2H2H2^HH6>,>,>,H2>"H28&>"H2?22!!WFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFFxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxN$<<$.2",2222`2 LL2 LL2L"",,2d""73.3555 of the Commission's rules, 47 C.F.R.  73.3555. Thus, GOCOM proposes to operate  xWYDO(TV) as a satellite of WFXI(TV), in accordance with the satellite exception to the duopoly prohibition set forth in Note 5 to Section 73.3555.  X-  x2. Under our satellite policy, set forth in Television Satellite Stations Review of Policy  X - xand Rules, Report and Order, 6 FCC Rcd 4212 (1991) (hereinafter Television Satellite Order),  xan applicant for television satellite status is entitled to a presumption that the proposed satellite  x.operation is in the public interest if the applicant meets three criteria: (1) there is no City Grade  xoverlap between the parent and the satellite; (2) the proposed satellite would provide service to  xKan underserved area; and (3) no alternative operator is ready and able to construct or to purchase  xand operate the satellite as a fullservice station. The Commission will view favorably  X%- xapplications that qualify for the presumption and are unrebutted by an opposing party. Id. at  x=4214. If an applicant is unable to qualify for the presumption, we will evaluate the proposal on  X'- xKan ad hoc basis and grant the application if there are other compelling circumstances that warrant  X(-approval. Id."(,))ZZQ'"Ԍ  ԙ3. WYDO(TV) has operated under a programming agreement with WFXI(TV) since  X0 P"November 1992.vXR yOb   ԍKS Family originally entered into the programming agreement with a former licensee of WFXI(TV). When  P"Pit purchased WFXI(TV), GOCOM also acquired from the former licensee the rights under the programming agreement, and the right to purchase WYDO(TV) pursuant to an outstanding option agreement.v Under the programming agreement, WYDO(TV) carries programming  P"originating on WFXI(TV), including Fox Television Network programming. Applicants assert  X0 P" that the satellite proposal is, in essence, a request "to continue the status quo with respect to much  P"of the programming" aired by WYDO(TV). Applicants attempt to justify their request that  P"WYDO(TV) be permitted to operate as a satellite of WFXI(TV) by contending that their request  P"meets all three criteria for a presumptive satellite waiver. Although we conclude that their  P" request does not meet all three criteria for a presumptive satellite waiver, for the reasons set forth  P"below, we find that the proposed operation of WYDO(TV) as a satellite is consistent with our policy.  X 0  4. With respect to the first criterion for the presumption, applicants have submitted an  P"engineering study which demonstrates that the City Grade contours of WYDO(TV) and  P"0WFXI(TV) do not overlap. Thus, the satellite proposal meets the first component of the presumption.  X0  p5. Regarding the second criterion, an applicant can use either of two different tests to  P"demonstrate that an area is underserved. Here, applicants attempt to satisfy this criterion solely  P"by use of the "transmission test," under which a proposed satellite's community of license is  P"considered underserved "if there are two or fewer fullservice stations already licensed to it."  X60 P"Television Satellite Order, 6 FCC Rcd at 4215. Stations considered licensed to a community for  X!0 P"purposes of this test include all educational, regular TV and TV satellite stations. Id. There are  P"two fullservice television stations besides WYDO(TV) licensed to Greenville, WNCTTV and  P"WUNKTV, but applicants assert that the station for which satellite status is sought does not  X0 P"count for purposes of the transmission test. We disagree. While the Television Satellite Order  P" clearly excludes the proposed satellite station from consideration pursuant to the other test of  P"underservice to an area, the "reception test," there is no such language with respect to the  X0 P"transmission test. See id. In addition, we consistently have included in our transmission test  X0 P"analysis a licensed station for which satellite status is sought. See, e.g., Kelso Partners IV, L.P.,  Xq0 P"@11 FCC Rcd 8764 (1996); Stauffer Communications, Inc., 10 FCC Rcd 5165 (1995). To the  P" extent that the applicant implies that WYDO(TV), because of its existing programming agreement  P"with WFXI(TV), should be regarded as a "new" station that is not includable under the  X.0 P"transmission test analysis, we also reject such an argument. See Plains Television Partnership,  P"9 FCC Rcd 4435 (1994). Thus, with three fullservice television stations licensed to Greenville, applicants' satellite proposal fails to meet the transmission test.  X 0  06.  With respect to the third presumptive criterion, KS Family has not attempted to  P"pdemonstrate any efforts to sell WYDO(TV) to anyone other than GOCOM. Applicants explain,  P"however, that WYDO(TV) was not listed with a broker or offered for general sale recently due"",-(-(ZZ#"  P" to the existing option purchase agreement that GOCOM had acquired from the former licensee  P"`of WFXI(TV). Because applicants have not satisfied all of the components of the presumptive  X0satellite standard, we will evaluate their proposal on an ad hoc basis.  X0  `7. Applicants assert that WYDO(TV) is not economically viable as a standalone station  P"and therefore no alternative buyer could exist who would be willing to operate it as such. At the  P"core of this assertion is WYDO(TV)'s inability to cover the entire market with its signal.  P"Applicants note that WYDO(TV)'s market, the GreenvilleNew BernWashington Designated  XJ0 P"Market Area ("DMA"),JR {O  P"ԍ Nielsen ranks the GreenvilleNew BernWashington DMA as the 105th largest market.  See 1997 Television  {O and Cable Factbook. encompasses an area extending 154 miles from east to west and 121  P"miles from north to south, and that the population is spread out, as there is no large, core city  X 0 P"`in the market.CX $R yO  P"ԍ According to 1990 Census statistics, the poulation of the market is 672,635, while the population of the largest  P"community in the market, Greenville, is only 44,972. Greenville's population thus constitutes just 6.7% of the total market population.C WYDO(TV)'s predicted Grade B contour serves all or portions of only ten of  P"the seventeen counties in the DMA. In contrast, applicants state, the ABC, CBS and NBC  X 0 P"affiliates in the market, which operate on VHF channels, all cover nearly the entire DMA.& DR yO   ԍSpecifically, these competitors include: WCTI(TV), Channel 12, New Bern, North Carolina (ABC); WNCT yO TV, Channel 9, Greenville, North Carolina (CBS); and WITNTV, Channel 7, Washington, North Carolina (NBC). &  P"`Applicants recite figures demonstrating that the Grade B area of WYDO(TV) is at most one P"quarter the size of the Grade B area served by its VHF competitors, and the population served  X 0 P"Pis at most 38% of the population served by the VHF stations.  R yO   ԍSimilarly, applicants recite figures demonstrating that without the coverage enhancement provided by  P"association with WYDO(TV), the Grade B area of WFXI(TV), which is also located in the GreenvilleNew Bern P"Washington DMA, is barely 20% of the area of each of its VHF competitors, and the population served by WFXI(TV) is at most 24% of the population served by the other VHF stations. Consequently, applicants claim  P"that WYDO(TV) would be at a substantial competitive disadvantage if it were forced to operate  X{0 P"!as a standalone station. Indeed, applicants also submit Nielsen statistics showing that the highest audience share achieved by WYDO(TV) from July, 1993 through July, 1996 was 3%.  X80  p8. In further support of their assertions that WYDO(TV) is not economically viable as  P"@a standalone station and that no alternative buyer exists who would be willing to operate it as  P"such, applicants submit an economic analysis of the viability of WYDO(TV) as a standalone,  P"0fullservice independent station serving the GreenvilleNew BernWashington market. The  P"analysis, performed by Susan D. Harrison of Susan Harrison Associates, Inc., a consulting firm  P" specializing in financial and economic analyses for the broadcast industry, buttresses applicants'  P" contentions regarding WYDO(TV)'s competitive disadvantage in the market, and concludes that,  P"even making optimistic assumptions, "there is absolutely no reasonable likelihood that  P"WYDO(TV) will be able to sustain itself financially as a standalone, fullservice station," and  P"@no prudent businessperson would be willing to invest in the acquisition of WYDO(TV) for the"i ,-(-(ZZ"  P"purpose of operating it as one. Specifically, Ms. Harrison reasons that not only would  P"WYDO(TV)'s severe competitive handicap in the market manifest itself in hampered advertising  X0 P"sales efforts,R yOK  P" ԍ The analysis also shows that there are 20 television stations other than WYDO(TV) being viewed overtheair in the DMA. but it would also be exacerbated by the lesser quality programming but higher  P"programming costs that WYDO(TV) would face as the fifth commercial standalone station in  P"the market. Nonetheless, using optimistic assumptions regarding factors such as WYDO(TV)'s  P" likely audience share and operating costs as a standalone station, Ms. Harrison projects that over  P" a five year period, spanning 19972001, WYDO(TV) would suffer a cumulative present value loss  P"Pof $2,293,000. Furthermore, she calculates that, optimistically assuming that WYDO(TV) could  P"be sold at the end of five years for a multiple of twoandahalf times its net revenues in the fifth  P"year, the seller would still incur a net loss of $633,000. Therefore, Ms. Harrison concludes, "the  P"idea that today's hypothetical purchaser would achieve his return on investment through a sale of the station at a later date is unlikely to the point of dismissibility."  X 0  9. As further support for applicants' contentions, applicants submit a letter from Brian  P"E. Cobb, an experienced broadcast broker and founding partner of Media Venture Partners, a  P"national media brokerage firm, indicating that WYDO(TV) is not marketable as a standalone,  P"fullservice facility. Cobb opines that in a small market, such as the GreenvilleNew Bern P" Washington DMA, it is necessary for a station's signal to cover the entire market in order for the  P"@station to be successful. Cobb concludes that WYDO(TV)'s chance of economic survival as a  P"standalone station "is slight," based on its insufficient signal coverage of the DMA, the ability  P"of VHF competitors to cover the DMA, and the "lack of any prospects of meaningful network  P"affiliation." He states that were he asked to list the station, he would have "no interest in doing  P"P so" because it would be a difficult station to market on a standalone basis, and he would not feel comfortable brokering it because it "could damage the well being of the buyer."  X0  p 10. We find that applicants have adequately demonstrated that WYDO(TV) likely will  P"not be able to survive as a standalone, fullservice station in the GreenvilleNew Bern P"pWashington DMA, and, therefore, it is highly unlikely that an alternative operator would be  P"willing to purchase it to operate it as such. WYDO(TV) has been able to garner only a  P"minuscule audience share while rebroadcasting a full complement of Fox network programming,  P"and the station's inability to cover a significant portion of the market will likely hamper its  X70 P"efforts to improve those figures.c7 R {O!   ԍSee Roy M. Speer, 11 FCC Rcd 14147 (1996); Stauffer Communications, Inc., 10 FCC Rcd 5165 (1995).  {O!  P"See also Tak Communications, Inc., 11 FCC Rcd 2564 (1995), where a broker's statement as to the demographics  P"of the market, competition from VHF network affiliates, and inability of the proposed continued satellite operation  P"Pto reach more than onethird the audience reached by its VHF competitors was a persuasive factor in finding satellite status warranted. c We further note that WYDO(TV) is projected to lose nearly  P"2.3 million dollars over the next five years, if operated as a standalone station. As the  P"PCommission recently explained, its satellite station policy, "resting in significant part on the  P"@satellite station's questionable financial viability as a standalone operation, has furthered [its]",-(-(ZZ "  P"0ownership policies by adding additional voices to local television markets where otherwise no  X0 P"additional voices might have emerged. Review of the Commission's Regulations Governing  P"P!Television Broadcasting, Television Satellite Stations Review of Policy and Rules, Second Further  X0 P"pNotice of Proposed Rule Making, 11 FCC Rcd 21655, 21672 (1996). See also Sidney T. Warner,  X0 P"p3 FCC Rcd 4034, 4035 (1988). Based on the information before us, we find that the operation  P"Pof WYDO(TV) as a satellite of WFXI(TV) is warranted and is consistent with our current satellite policy.   XL0  ` 11. In view of the foregoing, we conclude, having found that the applicants are qualified  P"`in all other respects, that grant of the application would serve the public interest, convenience, and necessity.  X 0  P 12. Accordingly, IT IS ORDERED, That the request for operation of station WYDO(TV),  P"pGreenville, North Carolina, pursuant to the satellite exception to Section 73.3555(b) of the Commission's Rules, IS GRANTED.  X0  p 13. IT IS FURTHER ORDERED, That the application for consent to assign the license  P"of station WYDO(TV) from KS Family Television, Inc. to GOCOM License L.L.C. (File No. BALCT970422IA), IS GRANTED.   FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau