******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Applications of ) ) Betti D. Lidsky ) (Transferor) ) ) and ) File No. BTCCT-980317IA ) Cocola Media Corporation of Florida ) (Transferee) ) ) For Consent to the Transfer of Control of) Hispanic Broadcasting, Inc. ) Permittee of Television Station ) WPXP(TV), Lake Worth, Florida ) MEMORANDUM OPINION AND ORDER Adopted: May 21, 1998 Released: May 26, 1998 By the Chief, Mass Media Bureau: 1. The Commission, by the Chief, Mass Media Bureau, acting pursuant to delegated authority, has before it for consideration an application seeking consent to transfer control of Hispanic Broadcasting, Inc., permittee of WPXP(TV), Lake Worth, Texas, Channel 67 (IND) from Betti D. Lidsky (Lidsky) to Cocola Media Corporation of Florida (Cocola). Cocola also requests the Commission to grant a waiver of 47 C.F.R.  73.3555(b), the Commission's television duopoly rule, to permit common ownership of WPXP and WPXM(TV), Miami, Florida, a television station owned by Cocola's ultimate parent corporation, Paxson Communications Corporation (Paxson) whose Grade B contour overlaps WPXP's Grade B contour. Cocola requests that a waiver be granted pursuant to the conditional waiver policy expressed by the Commission in connection with its pending review of the duopoly rule. See Review of the Commission's Regulations Governing Television Broadcasting, Second Further Notice of Proposed Rule Making, 11 FCC Rcd 21655 (1996) (Second Further Notice). The application and waiver request are unopposed. 2. Waiver Showing. As demonstrated in Cocola's Engineering Statement, the predicted Grade B overlap of stations WPXP and WPXM encompasses 125 square kilometers and 150,130 persons. This represents 1.8% of the area and 10.1% of the population within the Grade B contour of WPXP, and 2.6% of the area and 5.2% of the population within the WPXM Grade B contour. The stations' Grade A contours do not overlap. Cocola argues that this level of overlap is well within the range of overlap previously approved by the Commission. 3. Cocola also maintains that the stations serve separate markets. Station WPXP is licensed to Lake Worth, Florida, which is part of the West Palm Beach-Ft. Pierce Designated Market Area (DMA), the 44th largest DMA, while WPXM is licensed to Miami, Florida, part of the Miami DMA, the 16th largest. Cocola argues that, because the stations are located in different markets, they will not compete for advertisers. According to Cocola, WPXM focusses its marketing efforts geographically on south Florida (Monroe, Dade and Broward counties) while WPXP will direct its marketing efforts toward the two counties containing the most television households in the West Palm Beach - Ft. Pierce DMA - North Palm Beach and South Palm Beach counties. Therefore, Cocola argues, it is very unlikely that common ownership of the stations will have any material impact on economic competition within the overlap area. 4. Furthermore, Cocola also notes that the stations will be operated separately with separate staffs overseen by different general managers. Given the physical distance between the two stations, they will not share job recruitment information, sales personnel, office space, or offer joint advertising rates. Each station will be carried on different cable systems. While both stations will be affiliated with Paxson's soon-to-be-launched broadcasting network, the stations are in separate markets for Nielsen ratings purposes; and companies seeking to place national advertising on the Paxson network will be charged rates based on each station's invididual ratings performance. Cocola also notes that each station will air locally produced infomercials, programming provided by local churches and public affairs programming focusing on the interests and concerns of the station's community. 5. Cocola states that the overlap area between WPXP and WPXM occurs entirely in Broward County, Florida. Despite the small size of the overlap area (125 square kilometers), Cocola submits that the residents in the area will receive Grade B television service from a minimum of 15 television stations all of which encompass the entire overlap area. In addition, 13 AM stations provide at least 0.5 mV/m service and 23 FM stations provide 1 mV/m service to the overlap area. At least 10 separate cable systems serve subscribers in Broward County and there is one daily and 14 weekly newspapers published in this county. Broward County also receives service from one MDS system. Cocola concludes that the number of alternative media in the overlap area far exceeds that which the Commission has considered acceptable in other cases citing Media General Broadcasting, Inc., 12 FCC Rcd 10434 (MMB 1997) (2 commercial television stations served the entire overlap area); Sainte Limited, DA 97-484 (MMB 1997) (2 full service television stations served the overlap area); and Pappas Telecasting of the Midlands, a California Limited Partnership, DA 97-424 (MMB 1997) (5 television stations served the overlap area); and WHOA-TV, Inc., supra (5 television stations served the entire overlap area). 6. Discussion. 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, 1479 n.12, 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. 7. Currently, the Commission is reexamining its broadcast television ownership policies, including the duopoly rule. In January 1995, the Commission proposed a new analytical framework within which to evaluate its broadcast television ownership rules. See Review of the Commission's Regulations Governing Television Broadcasting, Further Notice of Proposed Rule Making, 10 FCC Rcd 3524 (1995) (Further Notice). Subsequent to the release of that Television Ownership Further Notice, Congress directed the Commission to conduct a rulemaking proceeding to determine whether to retain, modify or eliminate existing limitations on the number of television stations that an entity may control within the same television market. See Section 202(c) of the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (Feb. 8, 1996) (Telecom Act). In response to this Congressional directive in the Telecom Act and to update the record, the Commission released the Second Further Notice in its pending television ownership rulemaking proceeding. In that Second Further Notice, the Commission tentatively concluded to authorize common ownership of television stations that are in separate DMAs and whose Grade A contours do not overlap. Second Further Notice, 11 FCC Rcd at 21681. 8. The Commission also stated in the Second Further Notice that it will be inclined, during the pendency of the television ownership proceeding, to grant temporary duopoly waivers involving stations in different DMAs with no overlapping Grade A contours. It also noted there its tentative conclusion that the record in that proceeding "supports relaxation of the geographic scope of the duopoly rule from its current Grade B overlap standard to a standard based on DMAs supplemented with a Grade A overlap criterion." Id. The Commission further stated that "we do not believe granting waivers satisfying the proposed standard, and conditioning them on the outcome of this proceeding, will adversely affect our competition and diversity goals in the interim. Id. Additionally, the Commission gave the staff delegated authority to act on applications seeking waivers consistent with this interim policy. 9. We believe that grant of a conditional waiver of the duopoly rule, subject to the outcome of the pending ownership proceeding, is justified in this case. The temporary common ownership of WPXP and WPXM would be consistent with the interim policy set forth in the Television Ownership Second Further Notice, as the stations are in separate DMAs and there is no Grade A overlap between WPXP and WPXM. Moreover, our examination of the record presented here reveals nothing suggesting that we should not follow the established interim policy in this case. Accordingly, we conclude that grant of a temporary waiver, conditioned on the resolution of the pending broadcast television ownership rulemaking, will serve the public interest, convenience and necessity. Any requests to extend this conditional waiver should be filed at least 45 days prior to the end of the six-month period and would be closely scrutinized. 10. In view of the foregoing, and having determined that the applicants are qualified, we find that a grant of these applications will serve the public interest, convenience and necessity. 11. ACCORDINGLY, IT IS ORDERED, that the request for conditional waiver of Section 73.3555(b) of the Commission's rules, to permit the common ownership of television stations WPXP(TV), Lake Worth, Florida, and WPXM(TV), Miami, Florida, IS GRANTED, subject to the outcome of the Commission's pending broadcast ownership rulemaking in MM Docket Nos. 91-221 and 87-8. Should divestiture be required as a result of that proceeding, the licensee is directed to file, within six months from the release of the final order in MM Docket Nos. 91-221 and 87-8, an application for Commission consent to dispose of such station as would be necessary for the licensee to come into compliance with the rules as provided in the final order. 12. IT IS FURTHER ORDERED, that the application for transfer of control of Hispanic Broadcasting, Inc., licensee of WPXP(TV), Lake Worth, Florida, from Betti D. Lidsky to Cocola Media Corporation of Florida (File No. BTCCT-980317IA) IS GRANTED. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau