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x$&7X2>C Y2 X    Y2 Q Federal Communications Commission`(#!DA 98436 ă  yxdddy s#X\  P6G;P# Before the _Federal Communications Commission  yO(jWashington, D.C. 20554 ă  YA2In re Application of#Xj\  P6G;[AXP#) )  Y2 ITTDow Jones Television ) (Assignor)) )  Y2and)ppXFile No. BALCT970519IB )  Y 2 Paxson Communications of )  Y 2 New York31, Inc. ) (Assignee)) ) For Assignment of License of) Station WPXNTV, New York, New York) )  X28}  MEMORANDUM OPINION AND ORDER x  Y2X` hp x (#%'0*,.8135@8:- xconsistent with the interim policy established in the Television Ownership Second Further Notice  xand must therefore be evaluated under the "extraordinary circumstances" standard set forth in that  X- xNotice. PaxsonNew York contends that extraordinary circumstances do warrant the grant of its  X-requested temporary waiver in this case. @  X-  !x 11. As an initial matter, PaxsonNew York asserts that the degree of Grade A and Grade  xB overlap between WPXNTV and WIPX(TV) is less extensive than that present in recent cases  X- xwhere the Commission has granted temporary waivers of the duopoly rule. ? {O- xԍ Citing Argyle Television, Inc., 12 FCC Rcd 10737, 10739 (1997); Providence Journal Company, 12 FCC Rcd 2883, 2885 (1997). According to  xLPaxsonNew York's engineering study, the predicted Grade A overlap between WPXNTV and  xWIPX(TV) encompasses 237 square kilometers, representing 2.4% and 5.3% of the land area  xMwithin the WPXNTV and WIPX(TV) Grade A contours, respectively, and 127,826 persons,  x[representing 0.9% and 7.2% of the populations within the Grade A contours of WPXNTV and"E  ,-(-(ZZ{"  X- x=WIPX(TV), respectively. ? yOy- xԍ Taking the proposed modification to WPXNTV into account, the Grade A overlap between WPXNTV and  xWIPX(TV) would encompass 385 square kilometers, representing 3.5% and 8.5% of the land area within the WPXN x[TV and WIPX(TV) Grade A contours, respectively, and 178,586 persons, representing 1.2% and 10% of the populations within the Grade A contours of WPXNTV and WIPX(TV), respectively.  The predicted Grade B overlap between WPXNTV and WIPX(TV)  xcovers 2,545 square kilometers, representing 15.6% and 30% of the land area within the WPXN xTV and WIPX(TV) Grade B contours, respectively, and 1,091,913 persons, representing 6.5%  x{and 34.7% of the populations within the Grade B contours of WPXNTV and WIPX(TV),  X-respectively. ? yO - xԍ Based on WPXNTV's proposed facilities, the Grade B overlap would encompass 3,125 square kilometers,  xMrepresenting 16.9% and 36.8% of the land area within the WPXNTV and WIPX(TV) Grade B contours,  xrespectively, and 1,443,637 persons, representing 8.3% and 45.9% of the populations within the Grade B contours of WPXNTV and WIPX(TV).  Xv-  x 12. PaxsonNew York also identifies a large number of television stations and other  xOmedia serving the New York City DMA generally and the WPXN/WIPX overlap area  xjspecifically. According to PaxsonNew York's submissions, twentytwo television stations are  xKlicensed to communities within the New York City DMA. Twentytwo television stations provide  xa Grade B or better signal to all or a portion of both the Grade A and Grade B overlap areas, and  x\three additional stations provide Grade B or better service to the Grade B overlap area only.  xKPaxsonNew York asserts that this number of television stations serving the relevant overlap area  x=exceeds that in other cases involving Grade A overlap in which the Commission has approved  X - xtemporary duopoly waivers.j X ? yO- xJԍ The engineering study submitted by PaxsonNew York states that these numbers of television stations serving  xthe overlap area remains the same whether considering the Grade A and Grade B contour of WPXNTV as licensed or as proposed to be modified in the pending modification application. j With regard to other media, PaxsonNew York notes that the New  xYork City DMA is served by 107 cable systems owned by 30 separate owners and that cable  xpenetration in the DMA has risen to 69%. Thirtynine daily newspapers and approximately 332  xjweekly newspapers are published in the New York City DMA. Moreover, within the New York  xytelevision metro market alone, there are a total of 137 radio stations. According to PaxsonNew  x[York's engineering study, 34 AM stations and 50 FM stations serve the WPXN/WIPX overlap area specifically.  X-  lx 13. In addition, PaxsonNew York asserts that WPXNTV and WIPX(TV) serve separate  xmarkets, even though both stations are assigned to the New York City DMA. While WPXNTV  x{serves the New York City area, WIPX(TV) is licensed to Bridgeport, Connecticut, and its  x\transmitter is located in Seymour, Connecticut, which is located in the HartfordNew Haven  xDMA. As a result, PaxsonNew York states that WIPX(TV) provides minimal coverage to the" ,-(-(ZZ4"  X- x=New York City DMA,[ X? yOy- xԍ According to PaxsonNew York's engineering submissions, WIPX(TV) provides a Grade A signal to only  x5% of the population and 7.4% of the land area in the New York City DMA, and provides a Grade B signal to only 10.4% of the population and 14.7% of the land area in the DMA.[ and has also been unable to obtain cable carriage in most communities  xNwithin the New York City market. Indeed, PaxsonNew York estimates that WIPX(TV) is  xcurrently carried on cable systems serving only four of the 29 counties in the New York Area of  x.Dominant Influence (ADI), and the 25 counties in which WIPX(TV) is not carried contain 89%  xof the ADI's television households. The two stations will moreover be operated independently  xduring the brief period of common ownership by Paxson entities. WPXNTV and WIPX(TV)  xwill, PaxsonNew York states, have separate studios and offices, and WIPX(TV) will maintain  x-its current studio and office space in Bridgeport. The stations will conduct their sales operations independently and will air separate programming.  X -  1x 14. For the reasons set forth in  1213, PaxsonNew York further contends that the  xllevel of economic competition and diversity in the New York City DMA will remain high,  xnotwithstanding the temporary common ownership of WPXNTV and WIPX(TV). The  xjCommission has, according to PaxsonNew York, granted temporary duopoly waivers in recent  X -cases involving smaller and less competitive markets than the New York market at issue here. ? {OW-ԍ Citing Argyle Television, 12 FCC Rcd at 1074142; Providence Journal Company, 12 FCC Rcd at 288586.  X-  Ox15. Finally, PaxsonNew York states that grant of the temporary waiver will serve the  xpublic interest by facilitating the launch of PAXNET, PCC's new familyoriented network that  xis scheduled to launch in September 1998. Following its acquisition by PaxsonNew York,  xWPXNTV will be the new network's flagship station in the eastern United States. Grant of a  xtemporary waiver allowing Paxson entities to control both WPXNTV and WIPX(TV) for a brief  xperiod will, PaxsonNew York asserts, help ensure the successful start of a new network that will  xcontribute to program diversity and network competition in most major television markets.  xPaxsonNew York contends that all of these factors, along with its firm commitment to divest  xWIPX(TV) in six months, constitute extraordinary circumstances warranting grant of a temporary duopoly waiver.  X-  Px16. Discussion. Following our review of the record in this case, we conclude that  xPaxsonNew York has demonstrated the requisite extraordinary circumstances justifying grant of  Xg- xa temporary sixmonth waiver. Although we stated in the Television Ownership Second Further  XR- xNotice that we would, during the pendency of the television ownership proceeding, be disinclined  x{to grant waivers inconsistent with our interim policy, we believe, based on the totality of  xcircumstances presented here, that a brief, fixed waiver of the television duopoly rule is warranted.  X-  x17. As we have previously stated, the Commission is not constrained from granting a  x<temporary waiver where circumstances "will not significantly frustrate the policies underlying the  X!- xmultiple ownership rules." Telemundo Group, Inc., Debtor in Possession, 10 FCC Rcd 1104,"!z,-(-(ZZ "  X- x1106 (1994) (quoting Family Television Corp., 59 RR 2d 1344, 1348 (1986)). Allowing Paxson  xentities to commonly own WPXNTV and WIPX(TV) for a brief period will not undermine our  xigoals of promoting diversity in programming and viewpoints and fostering economic competition,  xLgiven, as described above, the large number of broadcast and other media voices serving New  xYork, the top ranked DMA in the country. In particular, we note that the Commission has  xpreviously approved temporary duopoly waivers in cases involving a greater degree of Grade A  xand Grade B contour overlap and smaller and less competitive markets, so as to facilitate multiple  Xa- xstation transactions.Fa? {O- x<ԍ See Providence Journal Company, 12 FCC Rcd at 288588 (granting temporary waiver to allow common  xownership of two stations in the 12th ranked SeattleTacoma DMA, where Grade B overlap was nearly 100%);  {Ol - x<Argyle Television, Inc., 12 FCC Rcd at 1073942 (allowing temporary common ownership of stations located in  xJCincinnati, the 30th ranked DMA, and in Dayton, the 53rd ranked DMA, where Grade B overlap encompassed over  {O - x90% of the population of the Grade B contours of the two stations); Aflac Broadcasting Group, Inc., 12 FCC Rcd  x3907, 391417 (1997) (allowing temporary common ownership of two stations in 100th largest DMA (Savannah)  x.and two stations in 165th largest DMA (HattiesburgLaurel), where Grade A and Grade B overlap was almost complete).  We also note WIPX(TV)'s limited overtheair and cable coverage of the  x>New York City DMA, and PaxsonNew York's pledge to operate WPXNTV and WIPX(TV)  xindependently during the brief period of common ownership by Paxson entities. Based on these  xfactors, we conclude that diversity and competition in the New York City DMA will not be adversely affected by a short period of common ownership of WPXNTV and WIPX(TV).  X -  1x18. Moreover, as in the case of multiplestation transactions where we have granted  xtemporary waivers for duopolies not consistent with our interim policy, we believe that grant of  xthe waiver requested here will "promote commerce [and] encourage investment in the broadcast  X- xindustry." Stockholders of CBS Inc., 11 FCC Rcd at 3755. The record reflects PCC's plans to  xlaunch later this year a new television network, which should enhance program diversity and  xgrowth and competition in the broadcast industry. We recognize the important role that owning  XO- xa station in New York City may play in the success of such an emerging network,O? yO- xxԍ For example, all the traditional and emerging networks have network affiliates in New York City, and such stations are frequently networkowned as well. and we  xbelieve that grant of the requested temporary waiver is appropriate to facilitate PCC's acquisition of a New York City station and its launch of the seventh broadcast network in this country.  X-  @x19. Finally, PaxsonNew York expressed its "firm commitment to divest WIPX(TV) in  X- xsix months" in its waiver request. See February 9, 1998 Supplement to Assignment of License  xApplication at 14. Moreover, we note that, under the terms of the Asset Purchase Agreement  x-between the parties to the WPXNTV transaction, PCC is obligated to "dispose of the Bridgeport  X- xStation [i.e., WIPX(TV)] prior to consummation of the transactions contemplated hereby if  X- xNnecessary in order to obtain the FCC Consent." See Section 5.01 of May 12, 1997 Asset  xMPurchase Agreement. Given PaxsonNew York's express commitment in its application, and  x<PCC's contractual obligation to dispose of WIPX(TV) if necessary to obtain Commission consent  x>to the WPXNTV assignment, we are assured of PaxsonNew York's and PCC's intention to"A. ,-(-(ZZ{"  X-divest WIPX(TV) as expeditiously as possible.$? {Oy- xKԍ See Providence Journal Company, 12 FCC Rcd at 2888 (citing unequivocal commitment to divest station  {OC- xwinvolved in duopoly as a factor in granting temporary waiver); Aflac Broadcasting Group, Inc., 12 FCC Rcd at 3917  x(noting good faith intention of applicants to divest relevant stations concerned in duopoly waiver as expeditiously as possible).  X-  !x20. Because we believe that grant of the requested waiver will, for the reasons set forth  xabove, serve the public interest, convenience and necessity, we will grant PaxsonNew York a  xsixmonth waiver of the television duopoly rule to permit temporary common ownership of  xWPXNTV and WIPX(TV). Any request to extend this temporary waiver should be filed at least 45 days prior to the end of the sixmonth period and will be closely scrutinized.  X1- Conclusion  X -T ă  X -  !x21. In view of the foregoing, and having determined that the applicants are qualified in  xall respects, we find that a grant of the application to assign the license of WPXNTV from ITT xDow Jones Television to PaxsonNew York will serve the public interest, convenience and necessity.  X-  px22. Accordingly, IT IS ORDERED, That the petition to deny filed by Crown Communications Incorporated IS DISMISSED as moot.  XK-  @x23. IT IS FURTHER ORDERED, That the request of Paxson Communications of New  x_York31, Inc. for a permanent waiver of the duopoly rule, Section 73.3555(b) of the Commission's rules, to permit common ownership of WPXNTV and WPPX(TV), IS DENIED.  X-  @x24. IT IS FURTHER ORDERED, That the request of Paxson Communications of New  xYork31, Inc. for a conditional waiver of the duopoly rule, Section 73.3555(b) of the  xCommission's rules, to permit common ownership of WPXNTV and WPPX(TV), IS  xGRANTED, subject to the outcome of the Commission's pending broadcast television ownership  xrulemaking (MM Docket Nos. 91221 and 878). Should divestiture be required as a result of  xthat proceeding, the licensee is directed to file, within six months from the release of the final  xorder in MM Docket Nos. 91221 and 878, an application for Commission consent to dispose  xof such station as would be necessary for Paxson Communications Corporation to come into compliance with the rules as provided in the final order.  X -  x25. IT IS FURTHER ORDERED, That the request for temporary waiver of the duopoly  xrule, Section 73.3555(b), to permit common ownership of WPXNTV and WIPX(TV), IS  xGRANTED, provided that within six months of the consummation of the assignment of WPXN xTV to Paxson Communications of New York31, Inc., Paxson Communications Corporation must  x=file applications with the Commission arranging for the disposition of WIPX(TV), or otherwise"! ,-(-(ZZ " coming into compliance with the broadcast multiple ownership rules.  X-  x26. IT IS FURTHER ORDERED, That the application for the assignment of the license  xof station WPXNTV, New York, New York, BALCT970519IB, from ITT Dow Jones Television to Paxson Communications of New York31, Inc., IS GRANTED, x` `  hh@FEDERAL COMMUNICATIONS COMMISSION x` `  hh@Roy J. Stewart x` `  hh@Chief, Mass Media Bureau