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 PT6Q&P, vy>N=.X&N7  pTQ&j wy>I=.X',&I7  xTQ&X xI%,%X!J,7  PT6QJP yB"(!X,(7  PT6Q,Pj zn9C8*X'<C7  xTQX, {n9G8*X8+G7  pTQ, |I%/%XJ/7  pTQJx/[8SX@[R  PQP y>K=.XSB&K7  xTyQ&8nCdX@pXnR  PQXP V"B(<X@hBR  PQhP7WC;XqXW_ pQX ?xxxX-Xx6X@DQX@ DPC2XWXP7  PT6QXP, #DUC2XYXU7  pTQXj $DPC2X'XP7  xTQXX O)0(X-h07  PT6QhP"5@^(1<s"  y_3District of Columbia Circuit reversed the District Court and held that Section 335 was constitutional.L nZh"ԍXTime Warner Entertainment Co., L.P. v. FCC, 93 F.3d 957 (D.C. Cir. 1996) (Time Warner). (#Ɲ  y_3 In light of the interval between release of the 1993 NPRM and the Court's decision upholding this Section, the Commission issued a Public Notice on January 31, 1997, to update and refresh the record.  y_3The Public Notice requested additional comments on each of the issues raised in the 1993 NPRM and  y_`3on any other issues relevant to the implementation of Section 335.`XL nZX"ԍXWe received 25 comments and 20 replies in response to the 1993 NPRM and 43 comments and 28 replies to the Public Notice. In addition, we have received a number of ex parte filings addressing various specific issues. A list of commenters, as well as a description of the abbreviations used in this  nZ "Report and Order, is attached as Appendix A. References in this Report and Order to comments filed  nZx "in response to the 1993 NPRM are referred to as "1993 Comments" or "1993 Reply Comments." If no designation is made, the comments were filed in response to the Public Notice issued in 1997.(#   y_83  y_"=F III. SUMMARY ĐlV  y_3 10.` ` As required by the statute, the rules that we adopt here will apply to entities that are licensed to operate a DBS service pursuant to Part 100 of the Commission's rules, as well as to entities operating satellites in the Kuband pursuant to a Part 25 license and selling or leasing transponder capacity to a video program distributor offering service directly to consumers. In addition, these obligations will apply to nonU.S. licensed satellites providing DBS or DTHFSS services in the  y_ 3United States.   y_ 3   y_ 3 11.` ` As specifically required by statute, DBS licensees must comply with the political broadcasting rules of Sections 312(a)(7) (granting candidates for federal office reasonable access to broadcast stations) and 315 of the Act (granting equal opportunities to candidates at the lowest unit charge). This means that DBS licensees must grant legally qualified candidates for federal office reasonable access to their facilities, and must grant equal opportunities to all other legally qualified candidates. DBS licensees must, if they charge for political advertising time, sell time to candidates at the lowest rate available.  y_h3 12.` ` As noted above, Section 335 requires the Commission to require DBS licensees to set aside for "noncommercial programming of an educational or informational nature" an amount of channel capacity not less than four percent nor greater than seven percent. Pursuant to that authority, we will require DBS licensees to reserve four percent of their channel capacity exclusively for such programming. We will, however, limit the number of set aside channels a single national educational and informational programmer can use to one channel per programmer, until all qualified entities that have sought access have been offered access on at least one channel. We also limit access to the reserved capacity to noncommercial national educational programming suppliers. Finally, we adopt a narrow definition of direct costs in order to ensure that noncommercial programming suppliers are able to access affordable DBS channel capacity.  y_3  "0*&&((s"Ԍ y_"ԙ6 IV. DISCUSSION ĐlV  y_" A. Definition of Provider of DBS Service  y_`3 13.` ` As a threshold matter, we must identify the entities that will be subject to the public service obligations established by Section 335. Section 335(a) refers to "providers of DBS services"  y_3but does not define the term.XL nZx"ԍXSee 47 U.S.C. 335(a).(#X Section 335(b)(5)(A) defines a "provider of DBS services" as follows: ` ` (i) a licensee for a Kuband satellite system under part 100 of title 47 of the Code of Federal Regulations; orx`  y_H 3 ` ` (ii) any distributor who controls a minimum number of channels (as specified by Commission regulation) using a Kuband fixed service satellite system for the provision of video programming directly to the home and licensed under part 25 of title 47 of the Code of Federal  y_ 3Regulations. k XQI nZ"ԍX47 U.S.C.  335(b)(5)(A)(i) and (ii).(#k x`  y_X3 14.` ` The 1993 NPRM noted that deciding which DBS entities should be covered by Sections 335(a) and (b) is complicated by the Commission's DBS regulatory regime and the  y_3complexities of the satellite programming distribution business.TL nZ"ԍ1993 NPRM, 8 FCC Rcd at 1589.T The Commission has defined DBS service as a "radio communication service in which signals from earth are retransmitted by high power, geostationary satellites for direct reception by inexpensive earth terminals" as regulated by Part  y_3100 of the Commission's rules.xL nZ"ԍXInquiry into the Development of Regulatory Policy in Regard to Direct Broadcast Satellites for the  nZp"Period Following the 1983 Regional Administrative Radio Conference, 90 FCC 2d 676, 677, n.1 (1982).(# The Part 100 service was established in 1982 to use specific  y_h3frequencies in the Kuband that would provide service on a regional and/or national basis.nXhL nZ"ԍXThe Kuband generally refers to a band of frequencies at approximately 12 GHz. DBS licensees under Part 100 of the Commission's Rules operate in the frequency band 12.212.7 GHz for the distribution of  nZh"programming from satellites to subscribers' homes. See 47 C.F.R.  100.1(b).(#n Directtohome programming is also provided by fixed satellite service ("FSS") operators using lowpower and mediumpower satellites in the Cband (4/6 GHz) and in portions of the Kuband. FSS satellites are licensed under Part 25 of the Commission's rules and do not use the same frequencies as satellites  y_3licensed under Part 100.BX L nZX#"ԍXDTHFSS satellites are generally spaced two degrees apart while DBS satellites are typically spaced nine degrees from each other. The smaller spacing between satellites for DTHFSS service typically results in larger receive dishes than those used for DBS service.(#B The 1993 NPRM solicited comment on the meaning of the definition of"0*&&((s" "DBS providers" under both Parts 100 and 25 of the Commission's rules and on whether the same definition should apply to both Sections 335(a) and 335(b). Finally, we note that the Commission has proposed to streamline and consolidate its service rules governing DBS services and DTHFSS. Specifically, the Commission has proposed to consolidate the DBS service rules, currently located in  y_`3Part 100, with the rules for DTHFSS in Part 25.I`L nZ"ԍXPolicies and Rules for Direct Broadcast Satellite Service, Notice of Proposed Rulemaking, FCC 9826,  nZ"IB Docket 9821, 13 FCC Rcd. 6907, 6910 (rel. Feb. 26, 1998) (DBS Consolidation NPRM). Consolidating the regulation of all satellite services is intended to eliminate inconsistencies in the rules, reduce confusion and uncertainty for users, lessen regulatory burdens for licensees, and simplify the  nZ"development of advanced services. DBS Consolidation NPRM at  13.(#I  y_" 1. Part 100 Licensees  y_315.` ` With respect to Part 100 licensees, the 1993 NPRM specifically proposed that, in view of the explicit language of the statute, entities licensed under Part 100 should be held responsible for  y_p3ensuring that the obligations adopted pursuant to the statute are met.\pxL nZ"ԍX1993 NPRM, 8 FCC Rcd at 1590.(#\ The Commission, however, also recognized that a Part 100 licensee might delegate the daytoday functions of implementing these requirements to an entity that is actually controlling the distribution of programming by satellite to  y_ 3home viewers. Accordingly, the 1993 NPRM requested information on how these delegations of authority will occur and, on how this should affect our treatment of the responsibilities imposed by the statute.   y_X316.` ` Many commenters addressing this issue express the view that Part 100 DBS licensees  y_03are bound by the requirements set forth in the statute because of its explicit wording.0L nZ"ԍXSee SBCA 1993 Comments at 5; DirecTV 1993 Comments at 7; APTS/CPB 1993 Comments at 6; CFA 1993 Comments at 2. (#Ƴ For example, APTS/PBS asserts that licensees under Part 100 should be ultimately responsible for assuring that DBS  y_3capacity is made available to noncommercial programming suppliers.^ ` L nZ"ԍXSee APTS/PBS Comments at 3031.(#^ SBCA argues that, whether or not a Part 100 DBS licensee delegates its programming obligations under Section 335 to another  y_3entity, the Part 100 licensee should be ultimately responsible for meeting these statutory obligations.c! L nZ "ԍXSee SBCA 1993 Comments at 56.(#c CFA contends that making the Part 100 licensee ultimately responsible will facilitate enforcement of these obligations and resolution of disputes between Part 100 licensees and their delegates regarding  y_3responsibility for violations of Section 335 requirements.c" L nZ8#"ԍXSee CFA 1993 Comments at 23. (#c ""0*&&((s"Ԍ y_317.` ` In light of the fact that the explicit language of Section 335(b)(5)(A)(i) of the Act references "a licensee for a Kuband satellite system under Part 100 of Title 47 of the Code of Federal Regulations" within the definition of "provider of DBS service," we conclude Part 100 licensees are  y_3required to comply with the obligations of Sections 335(a) and (b).#L nZ"ԍXCurrent licensees are: DirecTV, USSB, EchoStar, MCI, R/L DBS, TEMPO and Dominion Video. (#Ƒ DBS licensees may delegate responsibility to programmers to comply with the licensees' obligations under Section 335, but we will consider the licensees ultimately responsible for complying with the rules we adopt today.  y_" 2. Entities Under Part 25 of the Commission's Rules  y_318.` ` Section 335(b)(5)(A)(ii) of the Act is less clear about what entity bears the public interest responsibilities. This section defines a "provider of direct broadcast satellite service" as "any distributor who controls a minimum number of channels (as specified by Commission regulation) using a Kuband fixed service satellite system for the provision of video programming directly to the  y_ 3home and licensed under Part 25 of Title 47 of the Code of Federal Regulations."Y$ XL nZ"ԍX47 U.S.C.  335(b)(5)(A)(ii).(#Y As the  y_ 3Commission observed in the 1993 NPRM, this definition could apply to a number of different entities, including the satellite licensee, the video programmer, other program suppliers and distributors, or other third parties, such as entities that lease capacity on a wholesale basis and resell it to individual  y_X3programmers.T%XL nZ"ԍ1993 NPRM, 8 FCC Rcd at 1591.T In the 1993 NPRM, the Commission tentatively concluded that the most natural reading of the statutory language is that the phrase "licensed under Part 25" refers to the satellite used to distribute programming, not to the "distributor" of the programming. The Commission sought comment on this conclusion, as well as on whether it could impose carriage obligations on entities other than the satellite licensees.  y_h319.` ` Commenters split between those placing ultimate responsibility for complying with the statutory public service obligations of Section 335 on the satellite licensee and those arguing that responsibility should fall on the entity responsible for selecting, packaging, and marketing multiple channels of video service over satellite facilities. APTS/PBS, for example, argues that the licensee of the Part 25 satellite should bear ultimate responsibility, even though that licensee is likely to lease  y_3channel capacity to a directtohome distributor.&xL nZ"ԍXSee APTS/PBS Comments at 3034; see also CME comments at 1617.(#Ƅ APTS/PBS and Primestar argue that the statutory  y_x3language requires this conclusion.~'xL nZ !"ԍXSee APTS/PBS Comments at 3134; Primestar 1993 Comments at 67.(#~   y_(320.` ` Other commenters contend that the statute only requires that the satellite system used by a directtohome distributor be licensed under Part 25 and that the ultimate responsibility for complying with the obligations of Section 335 should rest with the DBS distributor, not with the" '0*&&((s"  y_3satellite licensee.(L nZh"ԍXSee SBCA 1993 Comments at 910; GTE Spacenet 1993 Comments at 5; DirecTV 1993 Comments at 11. (#Ɲ In support of this position, they interpret the phrase "and licensed under Part 25 of Title 47 of the Code of Federal Regulations" as modifying a "Kuband fixed service satellite system"  y_3and not as applying to "any distributor who controls a minimum number of channels."R) L nZp"ԍXSBCA 1993 Comments at 10.(#R SBCA argues that "[t]here can be no other interpretation because the lone DBS service falling under this definition  y_`3conducts business as a program distributor and is not itself a licensee."I*`L nZ "ԍXId. at 10.(#I DirecTV also notes that Congress expressly used the term "licensee" as the operative mechanism for identifying Part 100 DBS  y_3providers but did not use this approach for addressing Part 25 providers.b+@L nZ "ԍXSee DirecTV 1993 Comments at 1112.(#b Instead, DirecTV asserts that Congress referred to "distributors" who control a threshold number of channels on a Part 25 satellite. As a result, DirecTV argues, Congress is conferring jurisdiction on the Commission to impose public service obligations on directtohome distributors, not the satellite licensees.  y_H 321.` ` We affirm our tentative conclusion that the statute should be interpreted as imposing on the satellite licensee the ultimate responsibility for complying with the statutory public service obligations of Section 335. We reach this conclusion for a number of reasons. First, the better interpretation of the statutory language supports this conclusion. In the statute, Congress used the  y_ 3conjunction "and", implying that distributor means an entity that controls channels and is licensed by the Commission. If Congress had meant to focus on the programmer, it could have said a "Kuband  y_X3satellite . . . that is licensed . . . ." Thus, we do not agree with SBCA that "licensed under Part 25"  y_03modifies the satellite system, but rather modifies the word "distributor."G,0L nZ"ԍCME Comments at 1617.G  y_322.` ` Second, we find that the Commission is required to impose the public interest  y_3obligations "as a condition of any provision, initial authorization, or authorization renewal."L-` L nZ"ԍXSection 335 (b)(1).(#L This shows Congress' intent to have the Commission regulate entities it can control through the licensing process. The Commission only authorizes licensees, not lessors of satellite capacity or programming distributors. To read Section 335(b) as applying to program distributors would mean that the Commission could not effectively carry out the law, since under Part 25, the Commission licenses, and thus can impose conditions on, the satellite system, not a particular programmer. Although the statutory language is ambiguous, we conclude that read as a whole, Section 335(b) imposes obligations on the satellite licensee. "x -0*&&((s"Ԍ y_323.` ` Third, as noted by APTS/PBS and CME, imposing the obligations on the Part 25  y_3licensee facilitates enforcement..L nZ@"ԍXSee CME Comments at 1617; APT/PBS Comments at 3233. (#ƀ It is unlikely that Congress would have intended that the statute be interpreted in a way that compromises enforcement. That would be the result, however, if we accepted GE Americom's argument that the reference to "provision" refers only to those providing  y_`3programming, which Part 25 satellite licensees do not do at present.[/`XL nZX"ԍGE Americom Further Reply Comments at 45.[ The Commission has greater enforcement powers under the Act over licensees than nonlicensees and it also has greater ownership  y_3information about satellite licensees than it has over unlicensed directtohome distributors.r0L nZ "ԍXSee APTS/PBS Comments at 33; CME Comments at 1617.(#r The Commission's enforcement powers with respect to nonlicensees are limited to forfeitures and cease and desist orders, which require court action. Neither of these remedies is as effective as the Commission's direct powers over licensees, which includes license revocation. Indeed, efforts to assert jurisdiction over programming suppliers and other nonlicensees could involve the Commission in litigation over its regulatory authority. The better interpretation of an ambiguous statute is one that facilitates enforcement, rather than one that makes enforcement difficult.  y_ 324.` ` Finally, we agree with APTS/PBS that by holding the satellite licensee responsible, the Commission would be in a position to apply the same regulatory regime to both Part 100 and Part 25  y_ 3DBS satellites.[1 xL nZ"ԍXSee APTS/PBS Comments at 33.(#[ Equal treatment is particularly important in light of the Commission's proposal to consolidate the Part 100 rules with those in Part 25. Should this occur, all DBS services will be licensed under Part 25. Licensees operating in Cband will not be subject to the rules we adopt today because the statute specifically applies only to satellites operating in the "Kuband."  y_325.` ` We acknowledge that Part 25 satellite licensees do not themselves provide  y_3programming, but simply lease bulk satellite transponder capacity.2L nZ8"ԍSee GE Americom Further Reply Comments at 6, n. 6; see also Time Warner Comments at 4548. We do not agree with commenters who contend that Part 25 licensees should be treated differently than Part 100 licensees  y_@3because Part 25 licensees have less control over programming.3@L nZx"ԍXSee, e.g., DirecTV 1993 Comments at 1112; USSB 1993 Comments at 23; GTE Spacenet 1993 Comments at 34; GTE Spacenet 1993 Comments at 67. (# As we noted with respect to Part 100 licensees, the Part 25 licensee can delegate responsibility for Section 335 requirements, but we will hold the Part 25 licensee ultimately responsible for compliance.  y_326.` ` We will allow satellite licensees to demonstrate compliance with these public service obligations by relying on certifications from distributors that expressly state that they have complied  y_P3with the obligations of Section 335. Of course, such reliance must be reasonable and cannot be an absolute shield against liability for violations of these rules. The Commission took a similar approach"( 30*&&((s"  y_3in its review of closed captioning requirements for "providers and owners of video programming."R4XL nZh"ԍXSee Closed Captioning and Video Description of Video Programming, Report and Order, 13 FCC Rcd  nZ0"3272 (1997) (Closed Captioning Proceeding) (implementing Section 305 of the Telecommunications Act of 1996); 47 U.S.C.  713. (#R In that proceeding, the Commission defined the term provider, as we use it here, to include the specific television station, cable operator, cable network or other service that provides programming to  y_3the public.a5XL nZ"ԍXVideo programming distributors are defined as all entities who provide video programming directly to  nZ"customers' homes, regardless of the distribution technologies employed by such entities. See Closed  nZ "Captioning Proceeding, 13 FCC Rcd at 3276.(#a Although the Commission held video programming distributors ultimately responsible for compliance with the closed captioning rules, it allowed distributors to demonstrate compliance by relying on certifications from producers, networks or syndicators, that expressly state that the programming is either captioned or exempt from the closed captioning rules. We conclude that a similar approach is appropriate here.  y_327.` ` We received no comments on whether, for the purposes of applying Section 335(a), "DBS providers" should be defined the same as they are in Section 335(b). In the absence of any statutory source for a different definition, we determine that the same definition should be applied to both sections of the statute.  y_ 328.` ` Section 335(b) provides that the Commission shall determine the minimum number of Kuband FSS channels that must be controlled in order for the public interest obligations to be  y_ 3applied.26 L nZ("ԍXFor DBS, the United States is assigned 32 channels at eight orbital locations. Each of these 32 channels has a certain center frequency and a bandwidth of 24 MHz. Generally, a DBS satellite has one transponder for each "frequency channel" and, using current compression technology, each frequency channel has sufficient bandwidth to accommodate 6-8 channels of video programming. This is similar  nZH"for DTHFSS however, as noted above, DTHFSS operates on different frequencies. (#2 HBO suggested that the Commission exclude entities controlling six or fewer transponders; DirecTV stated that an entity with a minimum of 11 channels should be subject to the statutory  y_03obligations.70 L nZ"ԍXSee Home Box Office Comments at 3; DirecTV Comments at 9. See also CFA Comments at 6 (12 channel minimum); Continental Satellite (do not apply obligations at all for seven years).(# SBCA noted that the Commission should make its determination based on its  y_3assessment of an equitable working of the DBS marketplace.L8L nZ"ԍXSBCA Comments at 6.(#L We conclude that the most equitable approach is to impose the public interest obligations on all DBS licensees, with the following exception. On balance, it would not serve the public interest to impose the obligation on an entity that  y_3controls so few channels of programming that application of the four percent rule would not yield even one setaside channel of programming, and, we therefore adopt a de minimis standard to avoid"h 80*&&((bs"  y_3the unintended result of subjecting very small and specialized services to public interest obligations.P9L nZh"ԍ See August 18, 1998 Ex Parte Letter of Philadelphia Park, indicating plans to offer eight enduser channels of horse racing news, features and events. Philadelphia Park urges the Commission to adopt a channel minimum that would exempt such small programmers in order to avoid the inequities of requiring them to hire staff just for the purpose of overseeing noncommercial programming and to avoid  nZ"the consequent substantial impact on the viability of its business plan.   P Accordingly, any DBS licensee controlling sufficient channels of programming to require set aside of at least one channel of video programming under our four percent reservation will be subject to the  y_3rules we adopt today.D:XxL nZ "ԍXFor example, a DBS provider must offer at least 25 channels of video programming to be subject to  nZh "these rules (4% of 25 programming channels equals one setaside channel); see IV(C)(1) below for discussion regarding channel capacity. (#D  y_`"  3. Applicability To NonU.S. Licensed Satellites  y_3 29.` ` Changes in the nature of the satellite industry have made the provision of DBStype  y_3service more global. Last year, the Commission adopted a Report and Order that established a  y_3framework under which foreign satellites could serve the U.S. market.p;XL nZ"ԍXAmendment of the Commission's Regulatory Policies to Allow NonU.S. Licensed Space Stations to  nZ"Provide Domestic and International Satellite Service in the United States, Report and Order, 12 FCC  nZ`"Rcd 24094 (1997) (Disco II Order).(#p This framework included all types of directtohome video services. Indeed, we have begun to receive requests involving foreign y_H 3licensed DBStype systems that seek to provide service in the United States.b<H L nZ"ԍSee e.g. Televisa 13 FCC Rcd. 10074 (1997).b Consequently, we must consider whether the rules we adopt today should apply to satellites licensed by administrations other than the United States that provide DBStype service in this country. ASkyB asserts that exempting operators using nonU.S. licensed satellites from the public service requirements applicable to U.S. licensed systems would have the perverse effect of giving a competitive advantage to those who are  y_ 3doing the least to serve the American public.= H L nZh"ԍXSee ASkyB Comments at 24; see also Morality in Media Comments at 45.(#Ɗ  y_0330.` ` We conclude that we should impose the same public service obligations we impose on U.S. licensed operators on operators of nonU.S. licensed satellites that provide DBS service to customers in the United States. This conclusion follows the policy applied in our recently adopted  y_3Disco II Order where we stated:  XWe will require nonU.S. satellite operators to comply with all Commission rules applicable to U.S. satellite operators. To do otherwise would place U.S. and foreign  y_3operators on an uneven competitive footing when providing identical satellite services" =0*&&(( s" in the United States and would defeat our public policy objectives in adopting these  y_3service rules in the first place.Z>L nZ@"ԍXDisco II Order at  173.(#Z   y_3For example, in Disco II we stated that we would require foreignlicensed "Big Leo" satellites to  y_`3comply with the Commission's rules regarding coverage requirements if they wished to provide service  y_83in the United States.;?8XL nZ0"ԍId. ; In addition, foreignlicensed satellites serving the United States must comply with the prohibition on U.S. licensees entering into an exclusive service agreement with other  y_3countries.Z@L nZp "ԍXDisco II Order at  166.(#Z  y_331.` ` Although Congress did not address the issue of Section 335's applicability to nonU.S. licensed satellites, we note that there were no nonU.S. licensed satellites proposing to provide DBS  y_H 3service in the United States at the time the statute was enacted. Today, the DBS market is much more global in scope and it is possible that a number of nonU.S. licensed satellites will provide service in the United States. Indeed, in negotiating international agreements allowing for the provision of DBS service into the United States by nonU.S. licensed satellites, we have explicitly provided that the DBS  y_ 3providers may be subject to public interest programming requirements.A xL nZ"ԍXSee Protocol Concerning the Transmission and Reception of Signals from Satellites for the Provision of DirecttoHome Satellite Services in the United States of America and the United Mexican States, (November 8, 1996), Article VI; Agreement Between the Government of the United States of America and the Government of the Argentine Republic Concerning the Provision of Satellite Facilities and the Transmission and Reception of Signals to and from Satellites for the Provision of Satellite Services to Users in the United States of America and the Republic of Argentina (June 5, 1998), Article VI.(#Ɨ  y_X332.` ` An argument could be made that Section 335(b) may not on its face apply to nonU.S.  y_03licensed satellites, since such satellites are not licensed under Part 100 or Part 25 of the Commission's rules. Although we are not licensing the satellite under Part 25, the earth stations necessary to receive service from a nonU.S. licensed satellite require Commission authorization under Part 25 and we will  y_3hold the earth station licensee responsible for compliance with the rules we adopt today.B  L nZH" X47 C.F.R. 25.131(j) (receiveonly earth stations operating with nonU.S. licensed space stations must  nZ"request a license to operate such earth stations). See also sections IV(a)(2) of this Report and Order (holding entities licensed under part 25 of the Commission rule but leasing satellite capacity to video programming resellers responsible for complying with the public interest rules).(# The receiving antennas are an integral part of any satellite system providing video programming directly to the home. Specifically, Section 25.137 of the Commission's rules requires that earth stations operating  y_@3with a nonU.S. licensed satellite be licensed by the Commission. This provides a vehicle by which  y_3the Commission can examine nonU.S. licensed satellites' compliance with our rules and provides a"B0*&&((>s"  y_3regulatory control point to ensure continued compliance.iCL nZh"ԍXDisco II Order at  188, 201.(#i Therefore, as a condition of its license, we will require the earth station licensee communicating with a nonU.S. licensed satellite that is  y_3providing the minimum number of video channels as defined in these rulesWDXL nZ"ԍXSee para 28 supra.(#W to comply with these  y_3public interest obligations.   B. Public Interest Requirements  y_3  33.` ` As added by the 1992 Cable Act, section 335(a) of the Act states: XThe Commission shall, within 180 days after the date of enactment of this section, initiate a rulemaking proceeding to impose, on providers of direct broadcast satellite  y_H 3service, public interest or other requirements for providing video programming. Any regulations prescribed pursuant to such rulemaking shall, at a minimum, apply the access to broadcast time requirement of section 312(a)(7) and the use of facilities requirements of section   315 to providers of direct broadcast satellite service providing video programming. Such proceeding also shall examine the opportunities that the establishment of direct broadcast satellite service provides for the principle of localism under this Act, and the methods by which such principle may be served through  y_03technological and other developments in, or regulation of, such service.GE0L nZ"ԍ47 U.S.C.  335(a).Gxx-   y_" 1. Political Broadcasting Requirements  y_3!34.` ` The 1993 NPRM proposed applying existing rules implementing the access to broadcast time requirements of Section 312(a)(7) and the use of facilities requirements of Section 315 of the Act to DBS providers and to tailor these rules to account for differences between multichannel  y_3DBS systems and traditional broadcast stations.TFxL nZ0"ԍ1993 NPRM, 8 FCC Rcd at 1593.T While we impose the existing political broadcasting rules, as discussed below, we recognize that applying these rules to the DBS service may present difficulties not encountered in the broadcast environment. Unlike network broadcasters, DBS licensees currently do not originate programming, sell advertising time or provide local network signals  y_x3throughout the country. GxL nZ !"ԍXDirecTV explains that DBS licensees use the same program feeds as cable distributors, although cable distributors are able to insert local advertising into the programming stream after it reaches the cable headend. DBS licensees do not insert advertising for technical, economic and legal reasons. Programmers would have to create a "DBS feed" separate from that provided to cable, to insert advertisements. DirecTV June 29 Letter at 4. EchoStar states that it would have to abrogate its existing contracts with cable programmers and require these programmers to insert additional material in order to"%F0*&&%" comply with the broadcasting requirements. EchoStar June 30 letter at 12.(#  "xXG0*&&((s"Ԍ y_" Ùa. Reasonable Access  y_3  y_3"35.` ` Section 312(a)(7) of the Act requires broadcasters to allow legally qualified candidates  y_3for federal office reasonable access to their facilities.GHXL nZ"ԍXSpecifically, Section 312(a)(7) provides that the Commission may revoke any station license or construction permit for willful or repeated failure to allow reasonable access to or permit purchase of reasonable amounts of time for the use of a broadcasting station by a legally qualified candidate for Federal elective office on behalf of his candidacy. See 47 U.S.C. 312(a)(7); 47 C.F.R. 73.1944. Consequently, as noted below, this right of access does not apply to candidates for nonfederal state or local offices.(#G Access can be provided on a free or paid basis. Since the passage of Section 312(a)(7), the Commission's policy has generally been to defer to the reasonable, good faith judgment of licensees as to what constitutes "reasonable access" under all the  y_3circumstances present in a particular case.IXL nZ"ԍXSee, e.g., Codification of the Commission's Political Programming Policies, Memorandum Report and  nZH"Order, 7 FCC Rcd 678, 68083 (1991), on recon., Memorandum Opinion and Order, 7 FCC Rcd 4611  nZ"(1992) (Codification of the Commission's Political Programming Policies). (#Ʈ The Commission tentatively concluded in the 1993  y_3NPRM that DBS providers should, like broadcasters, have discretion to determine what is reasonable and may take into account a variety of factors in acting upon requests by federal candidates for  y_3access.UJ L nZ("ԍXSee id. at 4612.(#U It requested comments on whether any modifications to the political programming rules would be necessary because DBS is a multichannel service, unlike traditional broadcasting. Specifically, the Commission asked whether a DBS provider that controls multiple channels should be required to make all video channels available to federal candidates, including advertisementfree  y_ 3channels, or only certain channels.\K L nZ"ԍX1993 NPRM, 8 FCC Rcd at 1594.(#\ Finally, the Commission requested comment on whether all federal candidates would be eligible to utilize DBS political advertising. If so, the Commission tentatively concluded that, in determining reasonable access, DBS providers could take into account the burdens of providing access to all federal candidates.  y_03#36.` ` We affirm our tentative conclusion that the access to broadcast time requirement of  y_3Section 312(a)(7) applies to DBS providers. The statute could not be more explicit. Congress, however, did not indicate how the statutory requirements, which were designed for the traditional local  y_3broadcast medium, should be applied to a national, multichannel medium supplied by licensees who contract with third party programmers to provide programming directly to DBS subscribers.  y_@3$37.` ` Access for Federal Candidates We first address the question of which candidates are entitled to take advantage of the political broadcasting rules. DAETC argues that Section 312(a)(7), by referring to "federal" candidates, does not permit DBS providers to restrict availability to only"K0*&&((s"  y_3candidates for President and Vice President.YLL nZh"ԍXSee DAETC Comments at 89.(#Y In contrast, DBS providers argue that they should not be required to provide access to House and Senate candidates, but only to candidates for President and  y_3Vice President because DBS is not suited to localized or regionalized programming.MXL nZ"ԍXSee Primestar Further Comments at 8; Tempo Comments at 17; ASkyB Comments at 6; DirecTV Comments at 1314; Continental Satellite 1993 Comments at 27.(# DirecTV contends that House and Senate candidates may not benefit from DBS, since DBS targets the nation as a whole, and not an individual candidate's district. SBCA is concerned that providing such access  y_83would be an inefficient use of limited spectrum.zN8L nZ "ԍXSee SBCA Comments at 1215; SBCA June 30, 1998 letter at 1.(#z Primestar argues that to require a DBS provider to  y_3grant access to every federal candidate could potentially overburden a DBS provider's capacity. It also states that it is highly unlikely that federal candidates other than Presidential and Vice Presidential  y_3would have a serious interest in obtaining nationwide access to voters on such a dispersed basis.]O@L nZ"ԍXSee Primestar Comments at 8. (#] EchoStar calculates that providing access for all Congressional candidates would require 2500 minutes  y_p3of advertising.NPpL nZ"ԍEchoStar June 30 letter at 1.N  y_ 3%38.` ` We recognize that DBS is a national service and that Presidential and Vice Presidential candidates are the candidates who are most likely to want to exploit its national coverage. Conversely, it seems highly unlikely that federal candidates running in state or local campaigns would seek a national advertising outlet. We also recognize the technical and financial burdens that providing localized programming to cover other than national races would place on DBS providers, and that it may be impossible or impractical for those existing DBS providers to alter their service to allow for localized programming in all jurisdictions, at least in the near future. The Commission has never addressed the issue of whether and under what circumstances a candidate for the U.S. House of Representatives or Senate is entitled to access to a nationally distributed service under Section 312(a)(7). If this issue is brought to our attention in the context of a specific case, we will address it at that time. Factors we would consider in such a case include the number of candidates requesting time, the technical difficulties in satisfying the request, and the availability of reasonable alternatives.  y_3&39.` ` Access to Channels. Next we address the issue of what constitutes reasonable access in the context of a varied multichannel environment. SBCA argues that the Commission should take into account the differences between terrestrial broadcasters licensed to serve particular communities and national, multichannel subscription services, as well as the fact that DBS licensees offer channel space to third party programmers and exercise no control over programming on these channels. Thus, SBCA and ASkyB urge the Commission to give DBS providers discretion to designate a discrete number of the channels over which they retain control for political broadcasting purposes, such as  y_3channels on which the DBS provider sells advertising time, controls a block of programming time, or"` P0*&&((s"  y_3reserves for public access.rQL nZh"ԍ XSee SBCA Comments at 1718; ASkyB Comments at 5. (#r Similarly, DirecTV argues that given the general inability of DBS providers to alter daily programming schedules to accommodate political broadcasting time, DBS providers should be given the flexibility to place all political advertisements on a single channel or on a limited number of specific channels if the provider determines that such is an optimal strategy to  y_`3meet its public service obligations.ZR`XL nZX"ԍXSee DirecTV Comments at 14.(#Z  y_3'40. ` ` DAETC argues that DBS providers cannot adopt a rigid policy relegating candidates to  y_3a separate channel or channels for candidate speech. DAETC also suggests that if contractual agreements prevent a DBS provider from giving a candidate reasonable access, the Commission should preempt a contract to permit access. It states that any future contracts with programmers should  y_p3permit DBS providers to insert candidate advertisements into programming.YSpL nZ "ԍXSee DAETC Comments at 89.(#Y  y_ 3(41.` ` While we agree with DAETC that placing political advertisements on channels separate from other programming may be problematic, we also acknowledge the difficulties presented  y_ 3by a requirement that DBS providers alter program feeds supplied by independent programmers. DBS providers will be allowed to make reasonable, good faith determinations in providing access to federal candidates. The determination of whether access is reasonable under Section 312(a)(7) is a highly factspecific determination that must take into account a number of factors. Relevant factors we would consider include the amount of time requested, the number of candidates in the race, possible program disruption, technical difficulties of providing the access requested, and the availability of reasonable  y_3alternatives.TxL nZ"ԍXSee Codification of the Commission's Political Programming Policies, 7 FCC Rcd. 678, 681 (1991) (providing general guidelines for reasonable access).(# Whether the access provided by a DBS provider in a particular case is reasonable will be decided on a casebycase basis. We will monitor DBS providers' performance in this area so that we can modify our rules if necessary and as experience dictates. We will, of course, evaluate any complaints filed against DBS providers with respect to their obligations under Section 312(a)(7), to determine whether they are acting within the spirit of the statute and Commission rules and policies. We will require DBS providers to maintain a file available to the public at the providers' headquarters  y_3containing requests for political advertising time and disposition of those requests.   y_3  y_3)42.` ` We confirm our tentative conclusion that where DBS providers carry the programming of a terrestrial broadcast television station, it is the responsibility of the terrestrial broadcaster and not the DBS provider to satisfy the political broadcasting requirements of Sections 312(a)(7). We reach this conclusion because terrestrial broadcast television stations are already under an obligation to abide by Sections 312(a)(7). This is consistent with our policy of requiring terrestrial broadcasters to comply  y_3with these statutory obligations when their signal is carried by cable television systems.UL nZH%"ԍXWe note that Section 315, but not Section 312(a)(7), applies to cable operators.(#Ɖ"` U0*&&((s"Ԍ y_"ԙ b. Equal Opportunities  y_3*43.` ` Section 315(a) of the Act provides that "if any licensee shall permit any person who is a legally qualified candidate for any public office to use a broadcasting station, he shall afford equal  y_`3opportunities to all other such candidates for that office in the use of such broadcasting station."qV`L nZ"ԍX47 U.S.C. 315(a); 47 C.F.R. 73.1941. (#q Section 315(a) also provides that "such licensee shall have no power of censorship over the material  y_3broadcast under the provision of this section." Both the statute and the rules narrowly define the term  y_3"use," and exclude from the definition candidates' appearances in bona fide newscasts, interviews, documentaries and the onthespot coverage of news events. In addition, Section 73.1940 of the Commission's rules defines "legally qualified candidate" as any person who has publicly announced his or her intention to run for nomination or office, is qualified under the applicable local, state or federal law to hold the office for which he or she is a candidate, and has qualified for ballot placement or has  y_ 3otherwise met all the qualifications set forth in the Commission's rules.HW XL nZ"ԍ47 C.F.R.  73.1940.H In the 1993 NPRM, the  y_ 3Commission proposed applying these rules, as well as policies set forth in prior Commission orders to DBS providers, and invited comments as to how to adjust the existing rules to better suit DBS  y_ 3technology._X L nZ0"ԍX1993 NPRM, 8 FCC Rcd 1589, 1594.(#_ The Commission invited comment on whether to apply to DBS providers the comparable audience size guidelines applied to cable TV, whether other factors should be considered, or whether to make determinations on a casebycase basis.  y_3+44.` ` Commenters generally supported the Commission's decision to apply existing cable  y_3rules to DBS services.YxL nZ"ԍXSee Tempo Comments at 1819; Primestar Comments at 10; but, cf. Home Box Office 1993 Comments at 67.(#ƪ Tempo and SBCA point out that the Commission has never required cable systems to air opposing candidates' advertisements on the same channels or to take into consideration  y_3the demographics of channels.bZL nZ"ԍ Tempo Comments at 1819; Primestar Comments at 1112.b They argue that there is no reason to impose a different or more burdensome policy on DBS services. Primestar urges the Commission to leave the precise channel selection to the discretion of the DBS provider, provided that audience size and daypart can  y_3reasonably be maintained among opposing candidates.\[` L nZ "ԍXSee Primestar Comments at 11.(#\  In contrast, DAETC argues that the DBS  y_3provider must make its best effort to ensure access to the channel the candidate requested at the time that would garner an audience of the same approximate size the candidate would have received by his  y_3or her request.  It further argues that Congress' primary purpose in enacting Section 315 is to ensure  y_x3candidates' access to the time periods with the greatest audience potential.\x L nZ%"ԍXSee DAETC Comments at 9, citing Becker v. FCC, 95 F.3d 75, 80 (D.C. Cir. 1996).(#Ɣ Some commenters express"x \0*&&((s" their concern for advertisementfree channels, urging that these channels be exempt from equal  y_3opportunities provisions.]L nZ@"ԍXSee DirecTV Comments at 1415; USSB Comments at 3 and 1993 Comments at 6; see also Primestar Comments at 1011.(#ƴ  y_3  y_3,45.` ` In conformance with the statutory mandate, we apply the equal opportunities provisions of the statute and the Commission's rules, as well as the policies delineated in prior Commission orders, to DBS providers. DBS providers will be required to ensure, by contractual  y_3means or otherwise, that these rules are followed. If one legally qualified candidate is afforded access to a DBS system, all other candidates for the same office who make timely requests must be afforded  y_3that same opportunity.^ L nZ "ԍXSee 47 C.F.R. 73.1941(c) (a request must be made within one week of the day on which the first prior use giving rise to the right of equal opportunities occurred).(# To ensure that competing candidates will be able to ascertain what equal  y_3opportunities they are entitled to, we will require the DBS provider to maintain a political file similar  y_p3to the one maintained by broadcasters._pxL nZ"ԍXSee 47 C.F.R. 73.1943 (requiring the licensee to keep and permit public inspection of a complete record of all requests for broadcast time made and an notation showing the disposition, charges, etc.).(# We will retain the definitions of "use" and "legally qualified candidate" in current rules and policies. As in the case of Section 312(a)(7), we intend to resolve any issues involving DBS providers' equal opportunities obligations in the context of particular cases.  y_ "  y_ "c. Lowest Unit Charge  y_ 3  y_ 3-46.` ` Section 315(b) of the Act and Section 73.1942 of the Commission's Rules provide that broadcasters may not charge any legally qualified candidate more than the lowest unit charge ("LUC") for advertising on the station during certain periods preceding the election. Under the LUC rule, a candidate may not be charged more than the station's most favored commercial advertisers would be  y_3charged for comparable time.`L nZP"ԍSee Codification of the Commission's Political Programming Policies, 7 FCC Rcd at 68990. The LUC provisions apply throughout the 45day period prior to a  y_3primary or runoff election and the 60day period prior to a general or special election. The 1993  y_3NPRM sought comment on our proposal to apply these rules and the corresponding policies set forth  y_h3in prior Commission orders to DBS providers.Tah` L nZh"ԍ1993 NPRM, 8 FCC Rcd at 1592.T  y_3.47.` ` We recognize the difficulties enumerated by commenters in applying the LUC requirements to DBS providers. ASkyB asserts that the programmer, rather than the DBS provider,  y_3sells commercial time on all DBS channels that include advertising.Yb L nZX#"ԍXSee ASkyB Comments at 58.(#Y SBCA argues that DBS  y_3providers cannot determine an appropriate LUC in the absence of a meaningful advertising base and" b0*&&((s" the LUC rule should not apply until DBS providers develop meaningful and consistent advertising  y_3sales.XcL nZ@"ԍXSBCA June 30 letter at 2.(#X  y_3/48.` ` Section 335 requires that the Commission apply Section 315 of the Act to DBS service providers. The LUC provisions are an integral part of Section 315. If advertising is sold on DBS systems, legally qualified candidates must be afforded the benefit of the LUC during the preelection periods prescribed by Section 315. Although we recognize that DBS providers do not currently have  y_3commercial rates on which to base a LUC determination, they can set a reasonable rate, based on consideration of marketplace factors such as what other media charge to reach a similar audience if  y_3they sell time to candidates pursuant to Sections 312 or 315 or otherwise choose to do so.[dXXL nZ "ԍXWe do not agree with ASkyB Comments at 8 that we should use the 50% direct cost formula of Section 335(b) as a benchmark for calculating the lowest unit charge for political sales because we find no justification for so constraining DBS operators in the sale of political advertising time.(#[ DBS providers, like broadcasters and cable operators, must disclose to candidates information about rates  y_H 3and discount privileges and give any discount privileges to candidates.eH xL nZ`"ԍSee Codification of Commission's Political Programming Policies, 7 FCC Rcd at 683687. Nothing in our rules would prevent a DBS provider from making time available without charge on a nondiscriminatory basis, if it wished to do so.  y_ 3  y_ " 2. Opportunities for Localism  y_X3049.` ` Section 335(a) requires the Commission "to examine the opportunities that the establishment of direct broadcast satellite service provides for the principle of localism under [the] Act, and the methods by which such principle may be served through technological and other developments  y_3in, or regulation of, such service." In the 1993 NPRM, the Commission asked whether technological  y_3advances have made it possible to accommodate local programming.TfL nZ`"ԍ1993 NPRM, 8 FCC Rcd at 1595.T The Commission stated that any regulations regarding DBS and localism would necessarily depend on whether it is technically  y_h3possible and economically feasible.KghL nZ"ԍXId. at 1596.(#K  y_3150.` ` Commenters were divided on whether the technology exists to justify imposing a localism requirement on DBS providers, and if so, whether it would be economically feasible. For instance, commenters such as NCTA, the Small Cable Business Association, and Time Warner, representing the cable industry, argue that DBS providers can and should comply with a localism"( g0*&&((s"  y_3requirement.hL nZh"ԍXSee NCTA Reply Comments at 1416; Small Cable Business Ass'n Comments at 911; Time Warner Comments at 3940.(#Ƭ NCTA states that if a DBS provider is the functional equivalent of a cable operator,  y_3then equal regulatory measures should be applied.Oi L nZ"ԍXNCTA Comments at 912.(#O  y_3251.` ` The Small Cable Business Association and NATOA encourage the Commission to impose a variety of local programming obligations, including "public, educational, government" use  y_83channelsj8L nZ "ԍXPublic, educational and government use channels ("PEG") are defined in Section 611 of the Act. 47 U.S.C.  611.(#Ƭ and local advertising insertions.k8L nZ "ԍXSmall Cable Business Ass'n Comments at 916; NATOA 1993 Comments at 89.(#Ɓ Time Warner argues that regulatory responsibilities of DBS providers should be equivalent to those imposed on cable operators to ensure parity and fairness  y_3between competing multichannel video programming distributors.]lL nZ "ԍXSee Time Warner Comments at 6.(#] The Alliance supports the use of  y_3spot beam technology to deliver local and regional noncommercial programming. It states that scarcity of spectrum in the DBS industry demands government regulation to protect noncommercial  y_p3programming, nationally and locally.Zmp( L nZ8"ԍXSee Alliance Comments at 5.(#Z  y_H 3  y_ 3352.` ` DBS providers argue against imposing any localism requirement on the grounds that  y_ 3satisfying such requirements would not be technically or economically feasible.n L nZP"ԍXSee, e.g., USSB Comments at 89; SBCA Reply Comments at 34; Tempo Comments at 2021. (#ƛ SBCA notes that the national scope of satellite technology makes anything but national broadcasting an inefficient use  y_ 3of very valuable spectrum.^o H L nZ"ԍXSee SBCA Reply Comments at 45.(#^ Tempo contends that DBS providers limited channel capacity and  y_ 3national service technology prevent delivery of service to local markets throughout the country.[p L nZ"ԍXSee Tempo Comments at 2021.(#[ Local DBS says, in contrast, that the technical and financial feasibility of localism in DBS does  y_03exist.Xq0hL nZ8!"ԍXLocal DBS 1993 Comments at 4.(#X  y_3453. ` ` The legislation provides no guidance on how to define "localism" in the context of DBS services. If localism means special programming for individual localities, we note that, although spot beam technology is available and could be used to regionalize programming, DBS providers may"q0*&&((ts" lack the channel capacity needed to serve all localities across the country. If localism refers to carrying local broadcast channels, then there are legal barriers to the Commission's ability to impose  y_3such a localism requirement. The Satellite Home Viewer Act of 1988, as amended,KrL nZ"ԍX17 U.S.C. 119.(#K prohibits a satellite carrier, including a DBS operator, from offering television network stations, pursuant to the compulsory copyright license, to subscribers who can receive a local affiliate of that network using a conventional overtheair antenna or to those subscribers who have subscribed to a cable system in the  y_3past 90 days that carries the local affiliate.sXL nZ "ԍXSee Satellite Delivery of Network Signals to Unserved Households for Purposes of the Satellite Home  nZ "Viewer Act, (rel. November 17, 1998; FCC 98302).(# No commenter has argued that the 1992 Cable Act should be interpreted as amending the Satellite Home Viewer Act.  y_3  y_3554.` ` To the extent that DBS providers, by law, cannot offer local signal retransmission, the Commission could not require DBS providers to offer local signal retransmission. Moreover, although there have been significant technological developments in the DBS industry since the Commission first developed rules for DBS and some DBS providers are providing limited local service, no DBS  y_ 3provider has the technical capability to provide local service to all markets in the country.t L nZH"ԍXWe note that EchoStar provides local signals to some of its subscribers and is advertising expansion of the number of markets that will receive local signals. EchoStar Comments at 56.(# We agree  y_ 3with APTS/CPB,Mu L nZx"ԍ APTS/CPB Comments at 3536.M however, that if the legal and technical issues regarding localized programming are resolved, we may consider requiring DBS providers to offer some amount of locallyoriented programming. We also support legislative changes to the Satellite Home Viewer Act that would remove any legal impediments to local signal retransmission by DBS licensees. Allowing DBS to provide local programming would expand the scope of the services DBS providers could offer and could enhance significantly DBS providers' ability to compete with cable.  y_3  y_3  3. Public Interest or Other Obligations   y_h3655.` ` The Commission noted in the 1993 NPRM that Section 335(a) provides a basis upon which to impose public interest obligations in addition to the political broadcasting requirement of  y_3Section 335(a) and the educational and informational programming requirement of Section 335(b).YvL nZP"ԍ1993 NPRM, 8 FCC Rcd at 15951596.Y The Commission tentatively concluded that additional obligations were not compatible with the flexible regulatory approach we have traditionally applied to DBS. Nevertheless, the Commission sought comment on whether it should impose additional obligations on DBS providers apart from those already mandated by Section 335.  y_(3 756.` ` CableRelated Obligations. The Commission received diametrically opposing comments on whether certain obligations applicable to cable providers should also apply to DBS"( v0*&&((s" providers. The cable industry argues that the Commission should apply to DBS providers most, if not all, of the public interest obligations imposed on the cable industry in order to achieve regulatory  y_3parity.  NCTA asserts that the phrase "other requirements" in Section 335(a) of the Act should be interpreted to include those obligations imposed on the cable industry, including mustcarry obligations, program access rules, channel occupancy limits, syndicated exclusivity, network nonduplication and sports blackout requirements, leased and PEG channel access requirements, cross y_3ownership prohibitions, and local taxes and other fees.wL nZx"ԍXSee NCTA Comments at 920; see also Small Cable Business Ass'n Comments at 1618; US West Comments at 5. (#Ʈ Similarly, the Small Cable Business Association asserts that equivalent rules are necessary to provide a level, competitive playing field within the multichannel video programming distribution market and that without these requirements,  y_3there will be a lack of parity among DBS, cable and Open Video Systems ("OVS").x L nZX "ԍXSee Small Cable Business Ass'n Comments at 16; NATOA 1993 Comments at 45. For a definition of  nZ "OVS, see 47 C.F.R  76.1500.(# It encourages the Commission to adopt regulatory requirements for DBS similar to those for OVS because OVS  y_H 3provides similar competition to cable.CyH xL nZ`"ԍXId. (#C   y_ 3857.` ` Time Warner states that there is no indication that DBS providers could not compete with cable under analogous regulation, arguing that the DBS industry is no longer at a competitive disadvantage because it has more than doubled its subscribership between 1995 and 1996 and has  y_ 3made significant advances in compression technology over the past few years._z L nZ("ԍXSee Time Warner Comments at 20. (#_ Time Warner concludes that the Commission should review the existing cable regulations and, if they are still found to be essential to the public interest, these regulations should be imposed equally on DBS providers. If, however, the Commission finds that these obligations are no longer necessary, then such obligations  y_3should no longer be imposed on the cable industry.H{L nZ"ԍXId. at 6.(#H  y_3958.` ` DirecTV strongly opposes the cable industry's attempt to establish regulatory parity between DBS and cable. To do so, it asserts, would ignore the differences between the two services  y_@3and would undermine the Congressional goal of reducing barriers to entry to the MVPD market.d|@( L nZ "ԍXSee DirecTV Reply Comments at 1112. (#d SBCA emphasizes that since cable is a regional and local wireline distributor of television  y_3programming, it is subject to regulation by both the FCC and local franchising authorities.]} L nZH#"ԍXSee SBCA Reply Comments at 14.(#] USSB cautions the Commission to analyze the motivation for the comments of the cable industry and asserts they are an attempt to stifle a potentially significant competitor. USSB suggests that the demand of"H }0*&&((s" the cable industry to have franchise fees and local property taxes imposed on DBS providers is an attempt to limit competition between DBS and cable.  y_3:59.` ` We decline to impose upon the DBS industry now the type of additional programming requirements advocated by the cable industry for a number of reasons. First, DBS and cable are separate and distinct services, warranting separate and distinct obligations. In establishing DBS in  y_31982, the Commission made clear that the service offers unique public benefits on a national scope.~ L nZx"ԍXSee Inquiry into the Development of Regulatory Policy in Regard to Direct Broadcast Satellites for the  nZ@"period following the 1983 Regional Administrative Radio Conference, Report and Order, 90 FCC 2d  nZ "676, 685686 (1982); National Association of Broadcasters v. FCC, 740 F.2d 1190, 119799 (D.C. Cir.  nZ "1984). (#ƾ While some DBS providers have sought authority to offer limited local signals, the primary coverage area for DBS is national. Cable, on the other hand, is primarily a regional or local service that does not possess any of the national attributes associated with the DBS service.  y_H 3;60.` ` In addition, we find that DBS is a relatively new entrant attempting to compete with an established, financially stable cable industry. DBS providers currently have far less market power than cable operators. One indicator of market power is market share. We note that, although the DBS industry has grown significantly since 1992, it still claims just under eight million subscribers in  y_ 3contrast to cable's 64 million customers. L nZ"ԍXThere are currently 7.3 million DBS and DTHFSS subscribers and over 64 million cable subscribers.  nZ"See supra  4.(# Moreover, cable can provide local service, while DBS can only do so on a limited scale. Because of the disparity in market power between DBS providers and cable operators, we find unpersuasive the cable industry's call for "regulatory parity" for entities that are not similarly situated. Additional obligations on DBS providers might hinder the development of DBS as a viable competitor to cable.  y_3<61.` ` The 1992 Cable Act and its legislative history reflect Congressional concern that horizontal concentration in the cable television industry, combined with extensive vertical integration  y_h3(i.e., combined ownership of cable systems and suppliers of cable programming), created an imbalance of market power, both between cable operators and program vendors and between incumbent cable  y_3operators and their multichannel competitors (e.g., satellite providers). We have found that concentration in the cable industry has limited competition and consumer choice in the MVPD  y_3market.XXL nZp"ԍXSee Implementation of Sections 12 and 19 of the Cable Television Consumer Protection and Competition Act of 1992, Development of Competition and Diversity in Video Programming  nZ!"Distribution and Carriage, Report and Order, 8 FCC Rcd 3359 (1993).(#X As a result of market concentration, Congress and the Commission have imposed on cable providers mustcarry obligations, program access rules, channel occupancy limits, syndicated exclusivity, network nonduplication and sports blackout requirements, and leased channel access requirements. Competitive concerns raised by the concentration of cable providers are not present with DBS services and therefore similar rules are not necessary. We have asked for comment on the issue of crossownership rules for DBS providers and the effectiveness of such rules in addressing the"( 0*&&((s"  y_3potential for anticompetitive behavior in a separate proceeding.lL nZh"ԍSee DBS Consolidation NPRM, 13 FCC Rcd at 6910.l With respect to local taxes, we note that Congress preempted the ability of local jurisdictions to impose taxes on directtohome satellite  y_3services.xXL nZ"ԍXSee  602 of the Telecommunications Act of 1996. (#x  y_3   y_`3=62.` `   Other Public Interest Programming .  CTW and CME suggest that Section 335(a) provides the Commission with the discretion to include children's programming as a component of the  y_3public service obligations required of DBS providers.nL nZ "ԍXSee CTW Comments at 7; CME Comments at 4. (#n In addition, CME suggests that the  y_3Commission impose guidelines to prevent overcommercialization of childrens DBS programming.GxL nZ "ԍCME Comments at 1012.G CTW also encourages the Commission to enact guidelines for DBS providers similar to the 1996  y_3childrens programming rules adopted by the Commission which govern conventional broadcasters.[L nZ@"ԍXSee CTW Comments at 4.(#[  y_p3In addition, Encore and DAETC support using a setaside for children's programming.gpL nZ"ԍXEncore Comments at 1213; DAETC Comments at 7.(#g DAETC would like the Commission to require DBS providers to reserve 3% of their available capacity for public interest programming, under Section 335(a), with 1% of that setaside to be devoted to  y_ 3children's programming.W ( L nZ"ԍXSee DAETC Comments at 7.(#W  y_ 3>63.` ` In addition to children's programming, commenters have suggested that other types of special interest programming be included. For example, DAETC states that Section 335(a) public interest programming could include local programming of interest to minority and underserved  y_03communities, and national and regional civic programming.F0 L nZ"ԍXSee id.(#F Alliance also asserts that in enacting the 1992 Cable Act, Congress intended that DBS services carry a diversity of programming and  y_3information which would serve the public interest.JH L nZ"ԍAlliance Comments at 67.J BET and HITN urge the Commission to adopt a  y_3requirement for programming geared toward diverse minority and ethnic groups.eL nZ0""ԍBET Reply Comments at 4; HITN Comments at 34. e   y_h3?64.` ` We conclude that, although Section 335(a) provides ample authority for us to impose other public interest programming requirements upon DBS providers, we will not exercise our"@h0*&&((Ps" authority at this time. DBS is still a relatively young industry and we decline to impose any additional obligations on the DBS industry before we see how DBS serves the public. As the DBS industry matures, it may develop a variety of ways to address the needs of its subscribers. Any further obligations imposed on it would be burdensome at this time and could prevent it from realizing its  y_`3potential as a robust multichannel competitor to cable.s`L nZ"ԍSee  Primestar Comments at 78; Tempo Comments at 34. s If it becomes evident that there is a need for regulatory intervention to assure carriage of this type of public interest programming, we will  y_3reconsider this conclusion.  y_" C. Carriage Obligations for Educational and Informational Programming  y_3  y_p3@65.` ` The 1992 Cable Act requires the Commission to adopt rules requiring DBS providers to make available channel capacity for programming of an educational or informational nature. Specifically, Section 335(b) of the Act states: X` ` (1) CHANNEL CAPACITY REQUIRED.The Commission shall require, as a condition of any provision, initial authorization, or authorization renewal for a provider of direct broadcast satellite service providing video programming, that the provider of such service reserve a portion of its channel capacity, equal to not less than 4 percent nor more than 7 percent, exclusively for noncommercial programming of an educational or informational nature.  ` ` (2) USE OF UNUSED CHANNEL CAPACITY.A provider of such service may utilize for any purpose any unused channel capacity required to be reserved under this subsection pending the actual use of such channel capacity for noncommercial programming of an educational or informational nature. ` ` (3) PRICES, TERMS, AND CONDITIONS; EDITORIAL CONTROL. A provider of direct broadcast satellite service shall meet the requirements of this subsection by making channel capacity available to national educational programming suppliers, upon reasonable prices, terms and conditions, as determined by the Commission under paragraph (4). The provider of direct broadcast satellite service shall not exercise any editorial control over any video programming provided pursuant to the subsection. X` ` (4) LIMITATIONS.In determining reasonable prices under paragraph (3)` ` (A) the Commission shall take into account the nonprofit character of the  y_3programming provider and any Federal funds used to support such programming; W  X` ` (B) the Commission shall not permit such prices to exceed, for any channel made available under this subsection, 50 percent of the total direct costs of making such channel available; and  X` ` (C) in the calculation of total direct costs, the Commission shall exclude ""X0*&&(( &s"ԌX` `  (i) marketing costs, general administrative costs, and similar overhead costs of the provider of direct broadcast satellite service; and  X` `  (ii) the revenue that such provider might have obtained by making such channel available to a commercial provider of video programming.  X` ` (5) DEFINITIONS.For purposes of this subsection  X` ` (A). . . .  X` ` (B) The term "national educational programming supplier" includes any qualified noncommercial educational television station, other public  y_p3telecommunications entities, and public or private educational institutions.GpL nZ "ԍ47 U.S.C.  335(b).G   y_ 3A66.` ` The 1993 NPRM solicited comment on issues related to channel capacity, responsibility for programming, the definition of national educational programming suppliers, the definition of noncommercial programming of an educational or informational nature, the use of unused  y_ 3channel capacity and the determination of rates. The Commission noted in the 1993 NPRM that the legislative history indicates that the purpose of Section 335(b) "is to define the obligation of direct  y_X3broadcast satellite service providers to provide a minimum level of educational programming."XXL nZP"ԍXHouse Committee on Energy and Commerce, H.R. Conf. Rep. No. 102862, at 222 (1992) (Conference  nZ"Report); see also 1993 NPRM, 8 FCC Rcd at 1596. (# It also states that the reservation requirement was cast in terms of a four to seven percent range to give  y_3"the Commission the flexibility to determine the amount of capacity to be allotted."L nZX"ԍXConference Report at 222; see also 1993 NPRM, 8 FCC Rcd at 1596.(#ƅ  y_" 1. Channel Capacity  y_h3B67.` ` The legislative history states that the Commission should consider the total channel  y_@3capacity of a DBS system in establishing setaside requirements.U@@L nZ "ԍSee Conference Report at 222. U The first question in calculating total channel capacity is whether Section 335(b) requires that discrete channels or a percentage of cumulative time be reserved. The Alliance, DAETC and Encore suggest that educational and  y_3informational programming be supplied on discrete channels.L nZ8 "ԍXSee Alliance Reply Comments at 45; Encore Comments at 16; DAETC Reply Comments at 2223; see  nZ!"also Research TV Comments at 1213; US West Comments at 8. (# Other commenters advocate a flexible  y_3approach in order to accommodate a variety of programmers with varying audiences./X( L nZh#"ԍXSee APTS/PBS Comments at 39; DirecTV Comments at 68; America's Health Network Comments at 34; Primestar Comments at 17; SBCA Comments at 14; USSB Comments at 5; Tempo Comments at 13; EchoStar Reply Comments at 3; NRTC Reply Comments at 1.(#/ They suggest"H 0*&&((s" that the setaside requirement should be measured in terms of hours, so that such programming will air  y_3over a variety of channels at certain times of the day.:L nZ@"ԍId.:  y_3C68.` ` We conclude that discrete channels should be reserved to fulfill the noncommercial reservation requirements of Section 335(b). We agree with Encore, DAETC and Alliance that using specific channels, rather than randomly placing educational and informational programming, will assure continuity, predictability and easier monitoring and enforcement. Requiring the set aside of discrete channels will make it easier for consumers to locate such programming on one or more  y_3particular channels.mXL nZ "ԍSee Encore Comments at 16; DAETC Reply Comments at 23.m We find support for this conclusion in the express language of Section 335(b)(1), which refers to the setaside requirement as a percentage of channel capacity and not in terms of hours. It may be true, as SBCA argues, that providing channel capacity on an hourequivalency basis will permit programmers to target specific audiences and facilitate distance  y_ 3learning.P L nZ"ԍSBCA Further Comments at 1112.P We conclude, however, that to address the reservation requirements on a cumulative time basis would involve overwhelming computation, monitoring, and enforcement problems. We will require DBS providers to ensure that programming is offered on consistent channels at consistent times in order to provide continuity and predictability for viewers.  y_X" a. Determination of Total Channel Capacity  y_3D69.` ` Having concluded that Section 335(b) requires the reservation of discrete channels, we must determine how to calculate total channel capacity of a DBS system and whether we should count the number of channels licensed or allotted to a DBS distributor or whether we should count the  y_3number of channels supplied to customers. The 1993 NPRM noted that the latter approach would take into account the expansion of the number of channels by compression techniques as suggested by the  y_@3legislative history.a@xL nZX"ԍX1993 NPRM, 8 FCC Rcd at 1596. The legislative history states that the Commission may consider the  nZ "availability of or use by DBS operators of compression technologies. Senate Report at 92. Compression technologies refers to the ability to compress sufficient information to display multiple video programs into the spectrum currently allotted for one channel. As a result, it is generally acknowledged that by using compression technology today, one transponder can accommodate eight to ten channels of programming. (#a Section 335(b) merely refers to "channel capacity." US West urges that in  y_3calculating total channel capacity, we should count the number of channels supplied to customers.f L nZ!"ԍXSee, e.g., US West Comments at 8.(#f Some commenters support the use of total transponder bandwidth in determining the statutory set" 0*&&((s"  y_3aside.L nZh"ԍXSee Alliance Comments at 89; APTS/PBS Comments at 39; Research TV Comments at 12 ; University of Texas/University of Virginia Comments at 1; HITN Comments at 12; NCTA Reply Comments at 6.(# This would include all video, audio and instructional capacity, as well as channels that are  y_3not being used for DBS service. L nZ"ԍXSee Research TV Comments at 12; PBS Comments at 40; NCTA Reply Comments at 6.(#ƌ Other commenters support only the inclusion of channels devoted  y_3to unduplicated full motion video programming.qL nZ"ԍXSee Tempo Comments at 7; NRTC Reply Comments at 5.(#q Additionally, a few commenters who support a videoonly interpretation suggest that informationonly, or "barker" channels used for onscreen  y_`3programming and instructions, should be excluded from the definition of available channels.~`@L nZ@ "ԍXSee DirecTV Comments at 6; Primestar Further Comments at 1415.(#~  y_3E70. ` ` The legislative history refers to "total channel capacity" but is silent as to whether that capacity means the capacity for all types of transmissions or the capacity used for video  y_3programming.L nZ0"ԍXConference Report at 222 (Commission should take into account total channel capacity in establishing  nZ"reservation requirement). See infra IV(A)(2).(# We conclude that channel capacity, for the purpose of applying Section 335 (b), should be based on the total channel capacity that is being, or could be, used to provide video  y_p3programming. Barker and other informational guide channels will be included as available channels for determining the required set aside, as they are video channels supplied to the customers. In addition, unused channels that could be used to provide DBS service will be included in the set aside calculation. We conclude that because Section 335(b) refers to services providing video programming,  y_ 3channels used for audio or other nonvideo services will not be included.x ( L nZ"ԍXWe note that we have asked for comments about channel capacity in another context. In Carriage of the Transmissions of Digital Television Broadcast Stations, Amendments to Part 76 of the Commission's  nZ("Rules, Notice of Proposed Rulemaking, CS Docket No. 98120, FCC 98153 (rel. July 10, 1998), Fed. Reg. 63 FR 42330 (rel. Aug. 7, 1998); we solicit comments on the definition of "usable activated channels" in the context of digital broadcast television carriage. Our conclusion about channel capacity in the context of DBS services is not dispositive in the case of must carry for digital television by cable systems.(#ƽ In addition, a DBS licensee is not required to provide any video programming for the first five years of the license term  y_ 3and is only required to use half of its total capacity for video programming thereafter.  hL nZ"ԍXSee Revision of Rules and Policies for the Direct Broadcast Satellite Service, 11 FCC Rcd. 9712,  12 nZP "17 (1995); Potential Uses of Certain Orbital Allocations by Operators in the Direct Broadcast Satellite  nZ!"Service, 6 FCC Rcd. 2581 , 2582 (1991) (stating that alternative uses could lessen DBS development risks).(#Ƭ Thus, using all channels, both video and nonvideo, licensed or allotted to a DBS licensee as the baseline measurement for applying Section 335 (b) is not appropriate. Further, DBS providers using their capacity for data or audio transmission cannot insert noncommercial video programming on those channels at all. "P0*&&((s"Ԍ y_3ԙF71.` ` We recognize that advances in digital compression technology will continue to expand the number of programming channels that can be offered to customers in a given amount of spectrum. In addition, the number of available channels will change depending on the complexity of the type of programming transmitted. For example, full motion sports programs require more spectrum than news programs featuring talking reporters. Thus, the total number of programming channels offered by a DBS licensee on all its satellites can vary on a weekly or even a daily basis. To address these fluctuations, we will require each DBS licensee to calculate on a quarterly basis the number of channels available for video programming on all its satellites. Each DBS licensee then will use the average of these quarterly measurements during the year to ascertain the total number of channels for purposes of determining the number of reserved channels. DBS providers will be required to record these quarterly channel measurements and average calculations as well as their response to any capacity changes in logs kept at their main offices and available to the Commission and to the public.  y_ "X b. Reservation Percentage (#  y_ 3G72. ` ` The 1993 NPRM sought comment on the percentage of channel capacity to reserve for programming of an educational and informational nature. In addition, the Commission sought comment on whether DBS systems with relatively large total channel capacity should be subjected to a  y_03greater reservation requirement than systems with relatively less total capacity.T0L nZ"ԍ1993 NPRM, 8 FCC Rcd at 1596.T The Commission proposed using a sliding scale so that systems with a certain number of channels would be required to  y_3reserve a specific number of whole channels for the noncommercial set aside.N@XL nZ"ԍ XThe legislative history of this provision states: "The Committee intends that the Commission consider the total channel capacity of a DBS system in establishing reservation requirements. Accordingly, the Commission may determine to subject DBS systems with relatively large total channel capacity to a greater reservation requirement than systems with relatively less total capacity. In determining a DBS system's channel capacity, the Commission may consider the availability of or the use by a DBS operator of compression technologies. This subsection permits a provider of such service to use any unused channel capacity designated pursuant to this subsection until the use of channel capacity is obtained, pursuant to written agreement, for public use." House Report at 293294. (#N  y_3H73.` ` Commenters are divided on the appropriate percentage of channel capacity that should be set aside for educational and informational purposes. Some advocate that we should adopt a full seven percent reservation requirement now, arguing that the DBS industry has grown since the statute's enactment and that there has been an increase in the number of channels available on DBS systems, as  y_3well as in the number of DBS subscribers.` L nZ "ԍXSee US West Comments at 6; Research TV Comments at 811; APTS/PBS Comments at 3739.(#Ɠ APTS/PBS argues that there is ample programming available to justify a setaside of seven percent and that this higher percentage could also stimulate" 0*&&(( s"  y_3production of more noncommercial programming.XL nZh"ԍXLetter to Rosalee Chiara, International Bureau, Federal Communications Commission, from Marilyn  nZ0"MorhmanGillis, Lonna M. Thompson, Association of America's Public Television Stations, and  nZ"Gregory Ferenbach, Public Broadcasting Service (Sept. 22, 1997) (APTS/PBS Ex Parte Letter) at 5, 7.(#ƌ DBS providers, however, urge the Commission to apply the statutory minimum of four percent arguing that the industry is still in the early stages of developing and there is a limited amount of programming available to attract a national viewing  y_3audience.XL nZ"ԍXSee e.g. ASkyB Comments at 13; DirecTV Comments at 5; Primestar Comments at 1314; SBCA Comments at 10; USSB Comments at 11; Tempo Comments at 5; EchoStar Reply Comments at 3; NRTC Reply Comments at 34.(#  y_83I74. ` ` After considering the arguments of the commenters, we conclude that we should require DBS providers to reserve four percent of their channel capacity exclusively for noncommercial educational and informational programming. In the event that the four percent calculation creates any  y_3fraction of a channel, we will require the DBS provider to round the calculation upward. L nZh"ԍXFor example, if a DBS provider supplies 120 video channels to customers, we will require a DBS provider to reserve initially five channels for noncommercial programming of an educational or informational nature. Four percent of 120 channels amounts to 4.8 channels. Under the rules adopted  nZ"here, this figure would be rounded up to 5 channels. See 1993 NPRM, 8 FCC Rcd at 15961597.(# We choose four percent, instead of a higher number, because we find it in the public interest to put the minimum burden on this industry that currently has relatively little market power. We find that imposing the maximum setaside percentage now might hinder DBS in developing as a viable competitor in the MVPD market and that this factor outweighs possible benefits in establishing a higher percentage. Since we adopt the minimum reservation percentage, we need not adopt a sliding scale. We expect that DBS providers will begin carrying educational and informational programming as expeditiously as  y_ 3possible after the effective date of the rules.O L nZ8"ԍSee   138 & 139.O DBS providers have been aware of these programming obligations for a significant time. As a result, it is reasonable to expect that they will be able to begin airing educational and informational programming shortly after the effective date of the rules. We will monitor their compliance. Additionally, the public interest programming provided for in this order must be made available to all of a DBS provider's subscribers without additional charge.  y_" c. Impact on Existing Programming Contracts  y_h3J75.` ` The 1993 NPRM sought comment on whether DBS providers who are offering service pursuant to existing contracts with programming suppliers should have all existing services grandfathered and be subject to reservation requirements only if they add new programming to their  y_3service offerings.\ L nZ$"ԍX1993 NPRM, 8 FCC Rcd at 1597.(#\ We conclude that the reservation requirement applies notwithstanding existing programming contracts. DBS providers will have to make available sufficient channel capacity to" 0*&&(( s" fulfill the reservation requirement, regardless of existing programming contracts. Allowing DBS providers to apply the reservation percentage only to new contracts would further delay giving effect to the Congressional goal of providing noncommercial educational and informational programming through DBS and would put a disproportionate burden on new entrants that may not have existing programming contracts. We agree with ASkyB and PBS that the industry has had sufficient notice the relevant provisions were found constitutional two years ago that public interest obligations  y_3would be applied so that grandfathering is not necessary. L nZx"ԍXSee ASkyB Comments at 2324; APTS/CPB Comments at 19. We note also that the Commission  nZ@"decided not to grandfather programming contracts for cable channels designed for leased access, See Implementation of Sections of the Cable Television Consumer Protection and Competition Act of 1992:  nZ "Leased Commercial Access, Report and Order, 12 FCC Rcd 5276 (rel. Feb. 4, 1997). (# These rules will not become effective for  y_3at least 60 days after publication in the Federal Register.DXL nZ8 "ԍXSee  134, infra; see also 5 CFR 1320 (Implementation of Paperwork Reduction Act). DBS providers must be offering this educational and informational programming to the public no latter than six months after the effective date of the rules.(#D  y_"  2. National Educational Programming Supplier  y_H " a. Scope of Term  y_ 3  y_ 3K76. ` ` Pursuant to Section 335(b)(3), DBS providers must make the reserved channels available to "national educational programming suppliers" upon certain terms. Section 335(b)(5)(B) provides that the term national educational programming supplier "includes any qualified noncommercial educational television station, other public telecommunications entities, and public or  y_X3private educational institutions." The 1993 NPRM sought comment as to the scope of the term  y_03"national educational programming supplier"T0L nZ"ԍ1993 NPRM, 8 FCC Rcd at 1597.T and whether the Commission should adopt the definitions of "noncommercial educational broadcast station," "public broadcasting entity" and "public telecommunications entity" contained in Section 397 of the Act. The Commission also asked commenters to consider whether the eligibility criteria for the Instructional Television Fixed Service  y_3(ITFS) are relevant here. ` L nZ"ԍXITFS licensees may be accredited educational institutions, governmental organizations engaged in the formal education of enrolled students, or nonprofit organizations whose purposes are educational and include providing educational and instructional television material to such accredited institutions and governmental organizations. 47 CFR  74.932(a).(#ƞ  y_@3L77.` ` Neither this section of the statute nor the legislative history define "noncommercial educational broadcast station," "public broadcasting entity" or "public telecommunications entity." In the absence of any other Congressional guidance we conclude it is reasonable to look to other"!H 0*&&(( s" provisions of the Act in which those terms are defined. Our analysis of the comments refers us to  y_3Section 397 of the Act.PL nZ@"ԍSee DAETC Comments at 12.P  y_3M78.` ` Noncommercial Educational Television Station Section 397(6) of the Act defines a "noncommercial educational broadcast station" as a television or radio broadcast station that (i) "is eligible to be licensed by the Commission as a noncommercial educational radio or television broadcast station and which is owned and operated by a public agency or nonprofit private foundation, corporation, or association," or (ii) "is owned and operated by a municipality and which transmits only  y_3noncommercial programs for educational purposes."XXL nZ "ԍXSee 47 U.S.C. 397(6).(#X We agree with ASkyB and DAETC that we should adopt the definition of "noncommercial educational broadcast station" in Section 397(6) for the purpose of defining "noncommercial educational television station" in Section 335(b)(5). As the D.C.  y_H 3Circuit stated in Time Warner, the DBS setaside represents a new application of the wellsettled government policy long followed in the broadcast service of ensuring public access to noncommercial  y_ 3programming._ L nZ"ԍXSee Time Warner, 93 F.3d at 976.(#_ Therefore, we believe it is appropriate to use the definitions of noncommercial educational television station and public telecommunication entity used in the noncommercial broadcast context. We also note that Section 615(1) of the Act further defines such a station to include any television broadcast station that has as its licensee an entity eligible to receive a community service grant from the Corporation for Public Broadcasting.  y_3N79.` ` Public Telecommunications Entity Section 397(12) defines "public telecommunications entity" as any enterprise which (i) "is a public broadcast station or a noncommercial telecommunications entity" and (ii) "disseminates public telecommunications services to the public." A "noncommercial telecommunications entity" is defined as "any enterprise which is owned and operated by a State, a political or special purpose subdivision of a state, a public agency, or a nonprofit private foundation, corporation or association, and has been organized primarily for the purpose of disseminating audio or video noncommercial educational and cultural programs to the  y_3public by means other than a primary television or radio broadcast station."4x nZ"ԍX47 U.S.C.  397(7). The means of dissemination include, but are not limited to, coaxial cable, optical  nZ"fiber, broadcast translators, cassettes, discs, microwave, or laser transmission through the atmosphere. (#4  These entities are required to disseminate "public telecommunications services," which are defined as noncommercial educational and cultural radio and television programs, and related noncommercial instructional or  y_x3informational material.RxL nZ!"ԍSee 47 U.S.C.  397(14).R  y_(3O80.` ` Public and Private Educational Institutions Section 397 of the Act does not define the term "public or private educational institutions." We must look elsewhere for guidance in defining that term. APTS/CPB and HITN suggest incorporating the eligibility criteria established by the rules""` 0*&&((s" for instructional television fixed stations ("ITFS") contained in Section 74.932 of the Commission's  y_3rules L nZ@"ԍXSee 47 C.F.R.  74.932(a). ITFS are intended primarily to provide formal educational or cultural development to students enrolled in accredited public or private institutions or colleges or universities.(# because the types of services provided by educational institutions and ITFS are analogous.] L nZ"ԍAPTS/CPB Comments at 23; HITN Comments at 1.] Section 74.932(a) provides that a license for an ITFS will be issued only to an accredited institution or to a governmental organization engaged in the formal education of enrolled students or to a nonprofit organization whose purposes are educational and include providing educational and instructional  y_83television material to such accredited institutions and governmental organizations.N8 nZ? "ԍSee 47 C.F.R. 74.932(a)N   y_3P81.` ` Research TV advocates limiting access to reserved channel capacity to accredited  y_3institutions so that those institutions would get a larger share of channel capacity.U@L nZ"ԍResearch TV Reply Comments at 1415.U We see nothing in the language or apparent purpose of Section 335(b) that suggests the category should be so limited, however. Indeed, to limit the definition of public or private educational institutions to accredited institutions could stifle a variety of sources of educational and informational programming. Because we are aware of no evidence that Congress, in adopting Section 335(b) intended a different criteria, we adopt the ITFS criteria in interpreting "public and private educational institutions."  y_ 3Q82.` ` Additional Entities We next address whether the term "national educational programming supplier" is limited to noncommercial educational television stations, public telecommunications entities and public and private educational institutions. APTS/PBS contends that only those entities the ones expressly identified in section 335(b)(5)(B) are eligible to use the reserved channels. It argues that use of the word "includes" prior to the list of entities "signifies an  y_3intent to confine the term to the categories named in the definition."Q nZ"ԍXAPTS/PBS Comments at 14.(#Q Other commenters argue that the list of eligible entities was not intended to be exclusive. For example, Encore urges the Commission to broadly interpret Section 335(b)(1) to permit forprofit as well as nonprofit program suppliers to provide "noncommercial programming of an educational or informational nature" for the  y_@3reserved channels, arguing that more inclusive eligibility will result in better program service.@` L nZ@"ԍXEncore Comments at 1112.  See also DirecTV Comments at 5; USSB Comments at 10.(#Ə  y_3R83.` ` We do not believe that the list of entities in Section 335(b)(5)(B) was intended to be an exclusive list of entities that can qualify as national educational programming suppliers. We conclude that use of the term "includes" in that section indicates that what follows is a nonexclusive"# 0*&&((s"  y_3list that may be enlarged upon.PxL nZh"ԍXSee, e.g., Federal Land Bank v. Bismarck Lumber Co., 314 U.S. 95, 99100 (1941) (`including' is not one of allembracing definition but connotes simply an illustrative application of the general principle);  nZ"Puerto Rico Maritime Shipping Authority v. ICC, 645 F.2d 1102, 1112 n.26 (D.C. Cir. 1981) (it is  nZ"hornbook law that the use of the word `including' is illustrative, not exclusive); Exxon Corporation v.  nZ"Lujan, 730 F. Supp. 1535, 1545 (D.Wyoming, 1990), aff'd on other grounds, 970 F.2d 757 (10th Cir. 1992) (use of the word `includes' rather than the word `means' in a regulatory definition indicates that  nZ"what follows is a nonexclusive list which may be enlarged upon). (#P Neither case cited by APTS/PBS refutes the great weight of precedent supporting the view that use of the term "includes" in a statute is intended to be  y_3nonexclusive. McQuilken rejected an argument that convictions under 18 U.S.C.  860, which prohibits the sale of drugs on school property, were governed by the sentencing relief provisions of 18 U.S.C.  3553(f). Section 3553(f), however, expressly listed five sections of the federal criminal  y_83code falling within its ambit and did not use the word "includes."8L nZ "ԍXUnited States v. McQuilken, 73 F.3rd 105, 107 (3d Cir.), cert. denied, 117 S. Ct. 89 (1996).(#ơ Similarly, Lopez is inapposite  y_3because it did not address the interpretation of the word "including."uL nZH"ԍUnited States v. Lopez, 938 F.2d 1293, 1295 (D.C. Cir. 1991). u  y_3S84.` ` Moreover, the use of the term "includes" in Section 335(b)(5)(B) contrasts with the use of the term "means" in the definition of "direct broadcast satellite service" in Section 335(b)(5)(A). Congress may be presumed to mean different things when it uses different words in the same  y_H 3section.|H (  nZ"ԍXSee, e.g., Russello v. United States, 464 U.S. 16, 23 (1983).(#| Thus, we believe that Section 335(b)(5)(A) defines the term "provider of direct broadcast satellite service," while Section 335(b)(5)(B) gives illustrative examples of "national educational programming suppliers." Furthermore, nothing in the legislative history suggests that the list of entities in Section 335(b)(5)(B) was intended to be an exclusive list of "national educational programming suppliers."  y_X3T85.` ` While we do not interpret Section 335(b)(5)(B) as an exclusive list of eligible program suppliers, we do believe that Congress intended to limit eligibility to entities that share the same essential characteristics as those listed. As a matter of statutory construction, it is reasonable to construe the list as providing general guidelines as to the types of programming suppliers for which  y_3Congress intended the channels would be set aside.  L nZ"ԍXSee Gustafson et.al. v. Alloyd Co., 513 U.S. 561, 575 (1995) (stating that "[a] word is known by the  nZ"company it keeps (the doctrine of noscitur a sociis)."); see also Edwin W. Patterson, The Interpretation  nZ "and Construction of Contracts, 64 Columbia Law Review 833, 852 (1964) (discussing the meaning of words in series).(#Ƴ If the term "national educational programming  y_3suppliers" were not construed as limiting eligibility to some class of suppliers, then both the provision in Section 335(b)(3) stating that DBS providers must fulfill the requirements of Section 335(b) by making channel capacity available to "national educational programming suppliers" and the guidance provided in Section 335(b)(5)(B) concerning the eligible entities would be superfluous. In construing"$0*&&((>s" statutes, the courts strongly prefer an interpretation that gives meaning to all provisions of the statute  y_3to one that renders some provisions superfluous.L nZ@"ԍXSee, e.g., Hohn v. United States, __ U.S. __, 118 S. Ct. 1969, 1976 (1998); Kawaauhau v. Geiger, __  nZ"U.S. __, 118 S. Ct. 974, 975, 977 (1998); Arcadia v. Ohio Power Co., 498 U.S. 73, 7879 (1990). In  nZ"Arcadia v. Ohio Power Co., supra, the Supreme Court rejected an interpretation of the Federal Power Act that rendered "the preceding enumeration of specific subjects entirely superfluous in effect adding to that detailed list 'or anything else.'" 498 U.S. at 78. Such an interpretation, the Court cautioned,  nZ(""should not be adopted unless the language renders it unavoidable." Id.(# Therefore, we eschew an interpretation that would make any programmer eligible to use the reserved channels, without regard to its noncommercial character or goals.  y_83U86.` ` We conclude that the term "national educational programming supplier" in Section 335(b)(5)(B) includes only noncommercial entities with an educational mission. The term should not be interpreted as including "commercial" entities organized for profitmaking purposes. We believe that Congress intended to reserve channels for noncommercial programmers to ensure that DBS capacity would be available to programmers that are not driven by commercial incentives. We note  y_p3that this is how the D.C. Circuit has interpreted the statute. p@L nZP"ԍXSee Time Warner v. FCC, 93 F.3d 957, 976 (1995) (stating that Congress noted that economic realities of commercial broadcasting do not foster widespread commercial distribution of educational and cultural programs and that the government has recognized the potential effect of commercial pressures on educational stations). (#Ɖ Indeed, all of the entities listed in Section 335(b)(5)(B) have an educational mission and, with one exception, all are exclusively nonprofit entities. In addition, the only category listed that includes entities that can ever be organized as forprofit entities private educational institutions are usually organized as nonprofit entities. Moreover, we believe that the eligibility of a programming supplier under the statute should depend on  y_ 3its noncommercial character, not merely whether its programming contains commercials. ( L nZp"ԍXSee SBCA Reply Comments at 7; USSB Comments at 1011. Cf. Encore Reply Comments at 10.(#Ƣ We also note that Congress has defined providers of "noncommercial" service as nonprofit entities in other  y_X3provisions of the Act.X L nZ"ԍXSee 47 U.S.C.  397(7) (for purposes of Part IV of Title III); 47 U.S.C.  615(l)(1) (mustcarry for noncommercial programming). (# In addition, it seems reasonable to assume that the provisions in Section 335(b)(4)(B) which specifically limit the charges for setaside capacity were designed to benefit  y_3noncommercial entities rather than profitmaking enterprises.L nZ"ԍXWe note that the Conference Report states that "the pricing structure was devised to enable national educational programming suppliers to utilize this reserved capacity." Conference Report at 100. (#  y_3V87.` ` Therefore, only noncommercial entities with an educational mission will qualify to use the reserved channels. We believe that the tax code definition of nonprofit will apply to qualify an"%h0*&&((ts"  y_3entity as an eligible national educational programming supplier.ZL nZh"ԍX26 U.S.C.A.  501(c)(3). (#Z Thus, an entity with an educational mission that is organized under the tax code as a nonprofit corporation will be eligible as a national educational programming supplier. We recognize, however, that some wouldbe suppliers may not be susceptible to classification under the tax code but may be potentially eligible for the setaside as a national educational programming supplier within the meaning of the statute. An entity that is not organized as a nonprofit corporation may also qualify if it shows to the Commission's satisfaction that it is organized for a noncommercial purpose and has an educational mission. Furthermore, we do not intend to prevent participation by programming packagers or consolidators acting as agents on behalf of national educational programming suppliers as long as all entities contributing programming qualify as eligible entities under the statute. We will deal with such situations on a casebycase basis.  y_H 3W88.` ` We sought comment on whether noncommercial educational programming suppliers can enter into joint ventures with commercial entities, including DBS providers, and still qualify for  y_ 3access to the setaside channels.I XL nZ"ԍ1993 NPRM at 1598.I Several of the commenters favor allowing joint ventures between  y_ 3public and private entities.{ L nZX"ԍXSee Knowledge TV Comments at 9; Encore Reply Comments at 14.(#{ According to ASkyB, Primestar, SBCA and Tempo, allowing DBS providers to enter into joint ventures with noncommercial programmers will encourage the development and funding of quality programming which not only meets the standards of Section  y_X3335(b), but also serves the needs of DBS providers and their customers.UXXxL nZp"ԍXSee Primestar Further Comments at 20; ASkyB Comments at 21; Ex Parte Letter of Noggin, CTW, and Viacom dated August 19, 1998 (arguing that a joint venture between a nonprofit and a forprofit corporation providing commercialfree programming should qualify for the setaside).(#U  Other commenters believe that joint ventures will lead DBS providers to control the programming provided on the reserved  y_3channels and therefore urge us to prohibit such joint ventures.vL nZ@"ԍXSee, e.g., Green Sphere 1993 Comments at 1.(#v For example, APTS/PBS and the  y_3CTWr( L nZ"ԍAPTS/PBS Comments at 1718. See also CTW Comments at 810.r urge the Commission to deny eligibility for reserved capacity when the DBS provider has an ownership or similar relationship with the noncommercial program supplier that would give the DBS provider control over the programming. They also argue, however, that the Commission should not prohibit legitimate arrangements under which DBS providers, or any other forprofit entities, enter into  y_@3joint ventures with a qualified national educational programming supplier but do not control  y_3programming decisions.t L nZp""ԍXId. See also Knowledge TV Comments at 9.(#t  y_3X89.` ` We will permit joint ventures as long as participants demonstrate that the joint venture is noncommercial within the meaning of Section 335 and that the venture's mission is educational, as"&H 0*&&((s"  y_3discussed above. We believe that this approach will facilitate the development of quality educational and informational programming in furtherance of the objectives of Section 335 by providing additional sources of funding for noncommercial programmers without altering the noncommercial nature of the programming.  y_83Y90.` ` Finally, Research TV urges the Commission to allocate equal setaside capacity to each of the three categories of entities listed in the statute so that noncommercial educational television licensees, public telecommunications entities, and accredited public or private educational institutions  y_3are each entitled to use a specific portion of the setaside capacity.L nZ( "ԍXResearch TV Comments at 18, 21. See also University of Texas Comments at 1; University of Virginia Comments at 12.(#ƹ There is nothing in the statute or its legislative history that suggests such a rigid approach to channel allocation based on programmer category, and we do not believe that such an approach would serve the public interest. Moreover, we have decided that the listing of eligible entities in Section 335(b)(5)(B) was intended to be illustrative rather than exclusive, so other eligible entities would be unfairly excluded by Research TV's suggested approach. Therefore, we will not require that portions of the setaside capacity be dedicated  y_ 3exclusively to certain types of qualified programmers. Research TV's suggestion differs from our rule setting a limit on the number of channels controlled by a single national educational programming supplier. The channel limitation is designed to prevent the reserved capacity from being dominated by one or a few programmers but is not based on programmer categories.  y_" b. Definition of the Term "National"  y_3Z91. ` ` In the 1993 NPRM, the Commission sought comment on whether the term "national" in the definition of "national educational programming supplier" has any significance, noting that most of the entities included in the definition were perceived to be local in nature. HITN submits that to qualify as a "national" programming supplier, an entity would have to demonstrate that it is authorized, either by the Commission or through some other contractual obligation, to provide programming to  y_3viewers in different areas of the country.V L nZ"ԍXSee HITN Comments at 9.(#V Deutsche Welle Television urges the Commission to view the term "national educational programming supplier" broadly to include international noncommercial  y_3public broadcasters such as Deutsche Welle.cL nZ"ԍXDeutsche Welle Television Comments at 23.(#c  y_P3[92. ` ` There is no guidance in the statute or the legislative history with respect to the term  y_(3"national." (@L nZ""ԍXThe definition of "national" was only tangentially referenced in the legislative history documents, the closest reference being, "The term `national education programming supplier' includes any qualified noncommercial educational television stations, other public telecommunications entities or public or private institutions." House Conference Report at 101.(#ơ Defining the term narrowly to mean entities perceived to be national in nature could effectively preclude carriage of many educational programming suppliers that are included in the"'( 0*&&((s" statutory list of qualifying programmers and might severely limit the amount of noncommercial educational and information programming available on DBS. Upon review of the comments, we conclude that we should interpret the term "national" broadly so as to include local, regional, or national domestic nonprofit entities that qualify under the definitions listed above and produce noncommercial programming designed for a national audience. We also find that the definition should include international nonprofit programmers that satisfy the terms of the definitions in Section 397 of the Act and the Commission's ITFS rules. This approach will further Congress' underlying objective of enriching the public with a diverse core of educational and informational programming from nonprofit sources.  y_p" 3. Noncommercial Programming of an Educational or Informational Nature  y_H 3  y_ 3\93. ` ` Section 335(b)(1) requires that the reserved channels be used "exclusively for  y_ 3noncommercial programming of an educational or informational nature." The 1993 NPRM noted that the term "noncommercial programming of an educational or informational nature" is not defined in the  y_ 3statute. The 1993 NPRM sought comment on whether the Commission should define this term or  y_ 3simply identify categories of national educational programming suppliers.T L nZ"ԍ1993 NPRM, 8 FCC Rcd at 1598.T  y_03]94.` ` We conclude that our rules need not elaborate on the term "educational and informational" programming and that a DBS provider can comply with the reservation requirement by  y_3affording access to programming supplied by specific categories of noncommercial entities.[XL nZ"ԍXSee APTS/PBS Comments at 10.(#[ We will reconsider this conclusion, however, if it appears that more specific guidance on the definition of this term is necessary. In other words, although parties must comply with the statutory requirement that the reserved channels be used "exclusively for noncommercial programming of an educational or informational nature," we will not define this phrase more specifically at this time. Entities meeting this definition will be bona fide nonprofit programmers and educational institutions, and DBS licensees will be prohibited from exercising any editorial control over programming carried on the reserved channels. Given this and their nonprofit, educational mission, we find that the eligible programmers will have every incentive to provide educational and informational programming on their reserved channels.   y_(3^95.` ` Since we do not specifically define eligible educational and informational programs, we cannot accept CTW's suggestion to set aside capacity for children's TV, or USCC and Dominion's  y_3request to include religious programming.UXL nZ`!"ԍXCTW Comments at 4; USCC Comments at 23; Dominion Comments at 23. We have already discussed and declined to adopt additional public interest obligations under Section 335(a), including  nZ""setting aside capacity for children's programming. See Section IV.B.3.(#U The definition of "national educational programming supplier" is designed to ensure that only qualified noncommercial entities are included. Our"(0*&&((s"  y_3conclusion will provide access for a wide array of programs.L nZh"ԍSee NRTC Comments at 67 (urging Commission to define qualifying programming broadly). We note that, in order to qualify as  y_3noncommercial programming, the programmer cannot include advertisements.TxXL nZ"ԍSection 399B of the Act defines "advertisement" as: XAny message or other programming material which is broadcast or otherwise transmitted in exchange for any remuneration, and which is intended: (1) to promote any service, facility, or product offered by any person who is engaged in such offering for profit; (2) to express the views of any person with respect to any matter of public importance or interest; or (3) to support or oppose any candidate for  nZ "political office. See also 47 CFR 73.621.(#T  y_"  4. Implementation of Section 335(b)(3)  y_`3 ` `  y_83_96.` ` The 1993 NPRM's focus with regard to the portion of Section 335(b) specifying that DBS providers "shall not exercise any editorial control over any video programming provided [on the reserved educational channels]" was on responsibility for the programming in the event that  y_3Commission rules or federal statutes such as those prohibiting obscenity or defamation are violated.TL nZ"ԍ1993 NPRM, 8 FCC Rcd at 1597.T The Commission tentatively concluded that it would follow the approach it takes in enforcing Section 315(a) of the Act, under which a licensee may not censor material broadcast by or on behalf of a candidate, and, thus, the responsibility for the programming and any harm it may cause, such as  y_ 3defamation, remains with the candidate. ( L nZ"ԍXSee Farmers Educational and Cooperative Union of America v. WDAY, Inc., 360 U.S. 525 (1959) (broadcasters not responsible for defamation caused by political candidates advertisement).(# It also sought comment on whether a noncommercial program provider using reserved channel capacity must comply with the political broadcasting requirements imposed by Section 335, and if so, how those obligations should be enforced. Finally,  y_ 3referring to a thenpending rulemaking on indecency on cable leased access channels, the 1993 NPRM also sought comment on whether there were limited circumstances in which a DBS provider could  y_X3refuse carriage of programming or restrict its dissemination.TX L nZx"ԍ1993 NPRM, 8 FCC Rcd at 1597.T  y_03   y_"a. Editorial Control ` `  y_3`97. ` ` The commenters in this proceeding raised a separate issue about the practical application of the "editorial control" language in Section 335(b)(3). While all concede that the statutory language apparently prohibits DBS providers from editing or otherwise requiring changes in the content of programming provided by national educational programming suppliers for the reserved channels, some commenters have argued that Congress may have also intended to prohibit DBS providers from selectingamong qualified programmers or determining placement of programs on DBS")0*&&(( s"  y_3systems.L nZh"ԍXSee Alliance Comments at 4; DAETC Comments at 1820; Research TV Comments at 24; University of Texas Comments at 1; University of Virginia Comments at 2.(# Others argue that the provision allows providers to choose among qualified programmers  y_3but not to select individual programs.` L nZ"ԍSee, e.g., APTS/PBS Comments at 34.` Still others urge a narrow reading of the prohibition, arguing that it does not limit either the choice of programming or programmers, but only prevents a provider  y_3from altering the content of programs.]L nZ"ԍSee, e.g., USSB Reply Comments at 45.]  y_83a98. ` ` DAETC, for example, argues that Section 335 employs the same language as Section 612 of the Act, which requires cable systems to make "leased access" channels available for  y_3commercial use by unaffiliated persons.I@L nZ "ԍDAETC Comments at 1718.I DAETC quotes language from relevant legislative history of Section 612 asserting that it indicates that the leased access prohibition was intended to restrict the cable operator's ability to exercise control over the selection of programming, and argues that the same  y_p3restriction should apply to DBS providers.CXpL nZ"ԍXId. at 14, citing H. Rep. 98934, 98th Cong., 1st Sess. at 5152 (1984) (noting that the Committee is extremely concerned with the potential risk posed by indirect editorial control being exercised by a cable operator over use of leased access channels).(#C The Alliance and Primestar, however, disagree that cable  y_H 3leased access should be the model for DBS.H L nZ"ԍXAlliance Comments at 3; letter to Magalie Roman Salas, Secretary, FCC, from Benjamin J. Griffin, Counsel to Primestar (Dec. 12, 1997) (Primestar 1997 Letter) at 13.(# Primestar states that the purpose of Section 335(b) is not to assure source diversity, which was the objective in Section 612, but is instead to establish an  y_ 3obligation to provide a minimum level of educational and informational programming.  H L nZ"ԍXPrimestar 1997 Letter at 2; see also SBCA Reply Comments at 11 (stating that there is no basis for the statement that the statute closely tracks the PEG and leased access cable models and that DBS providers must have "the right to make unique program service selections both to fit their respective program packages and formats and to differentiate themselves from their cable and DBS competitors"). (# In addition, because Section 335 directs DBS providers to reserve capacity for noncommercial programming of an educational or informational nature supplied by specified types of programmers, Primestar argues that it requires those providers to make certain decisions about content and source. Therefore, Primestar argues that a DBS provider must have the ability to choose among qualified programmers. APTS/PBS agrees that the best approach would be to allow DBS providers to select from among the qualified noncommercial entities but argues that the prohibition on editorial control would prohibit them from  y_3choosing the specific programs for their systems.I0L nZ#"ԍAPTS/PBS Comments at 48.I "*0*&&((s"Ԍ y_3b99.` ` To resolve this controversy, we turn first to the language of the statute. On its face, Section 335(b)(3) requires DBS providers to make "channel capacity available to national educational programming suppliers" but prohibits the DBS provider from exercising "any editorial control over any  y_3video programming provided [on the reserved channels]" (emphasis added). The statute does not, on its face, ban selection of programmers. For the reasons discussed below, we disagree with those parties who would have us read such a ban into the statute nonetheless. We conclude that the best reading of the editorial control language is that it prohibits DBS providers from controlling the selection of, or in any way editing or censoring, individual programs that will be carried on the reserved channels. It does not, however, prohibit DBS operators from selecting from among national educational programming suppliers so long as the DBS provider does not refuse to make unused reserved capacity available to qualified suppliers. Nor does it prohibit DBS providers from refusing to carry nonqualifying programming or ineligible programmers.  y_ 3c100.` ` We specifically disagree with those commenters contending that the term "editorial control" necessarily bans selection among qualified national educational programming suppliers. It is important to consider this term in the context of this statute. Here, Congress established certain  y_ 3eligibility requirements for programmers who are entitled to use the reserved channels. L nZ"ԍXSee 47 U.S.C. 335(b)(3) and 335(b)(5)(B); para. 7890, supra.(#Ɔ It also required that the reserved channels be used "exclusively for noncommercial programming of an  y_03educational or informational nature."S0XL nZ("ԍX47 U.S.C.  335 (b)(1).(#S Thus, the statute itself limits the group of eligible programmers. If the DBS provider selects from among these eligibles, we see no reason to conclude that allowing the DBS provider to select the programmer would contravene the fundamental Congressional purpose of making noncommercial educational or informational programming available. Further, in our view, the statutory language indicates that Congress did not intend the ban on editorial control to bar selection of programmers; the ban comes into play only after the programmer is  y_@3selected.@L nZ"ԍXIndeed, use of the past tense in the term "programming provided" supports this reading of the statute. At the selection stage, no programming is yet being provided. (#  y_3d101.` ` The cases cited by DAETC do not persuade us otherwise. For the most part, those cases deal with cable leased access provisions, which, as we explain below, are not controlling with regard to interpretation of Section 335. Moreover, while we recognize that it can be argued that the power to select a programmer could be characterized as "editorial" in nature, that fact does not end the debate here. In this context, one must go on to ask whether that editorial function is one that Congress intended to ban through its use of the phrase "any editorial control over any video programming." We conclude it is not. As an initial matter, the text of the editorial control ban does not by its express terms, as explained above, extend to the selection of programmers. In addition, as discussed in paragraphs 105110 below, where, as here, Congress specifically designated the type of programming to be provided on these channels, it would be illogical to simultaneously ban the DBS provider from selecting programmers. Such a conclusion would make it much more difficult to"`+@0*&&((x!s" enforce the congressional purpose of making noncommercial, educational programming available on the DBS satellites. Indeed, this situation could be deemed analogous to the broadcasting context  y_3where licensees are held responsible for implementing statutory mandates.L nZ"ԍXSee Broadcast Station Operator Requirements, 59 FR 64378, 64379 (1994) (stating that the Commission holds the broadcast station licensee responsible for rule violations).(# And, as discussed above at paragraph 23, the better interpretation of an arguably ambiguous statute is one that facilitates enforcement, rather than one that makes enforcement difficult.   y_3e102.` ` We also reject arguments that our interpretation of Section 335 is constrained by our reading of similar language in the cable leased access provision. Section 335 only prohibits DBS providers from exercising "editorial control over programming," while the cable leased access provision, Section 612, also prohibits cable operators from "in any other way consider[ing] the content of such programming." The omission of this last clause from the DBS provision suggests that DBS  y_H 3providers are not necessarily barred from considering certain factors relating to programming in  y_ 3selecting programmers, but are prohibited from exercising control over such programming. Thus, we believe DBS providers might permissibly consider a variety of factors in deciding which programmers  y_ 3to select, including the broad genres of programming they plan to provide (e.g., cultural, documentary, children's educational), the programmers' experience, reliability, and reputation for quality programming, and the quality of programming they may have produced in the past. They may not, however, require the programmers they select to include particular series or programs on their channels as a condition of carriage. In this regard, we specifically differ with our dissenting colleague. We are unwilling to assume that DBS operators will improperly attempt to influence programming content through their selection process. Thus, we conclude at this time that the power to select among qualified programmers does not amount to "editorial control" that Congress sought to prohibit in Section 335(b)(3). If in the future, it appears that DBS operators seek to use the selection process as a means of improperly influencing programming provided on the reserved channels, we will take appropriate action. We decline to establish at the present time a complicated regulatory structure that sets out specific and detailed rules addressing the particular conduct DBS providers can or cannot engage in while selecting programmers. We conclude that such detailed rules are unnecessary where only four entities are actually providing DBS service, at this time, and where we have no reason to believe that these entities will not fulfill their obligations under the rules.  y_P3f103.` ` We recognize that this approach is different from the one we have taken with respect to cable leased access channels, but we believe that this difference is justified not only by differences in the language of the two editorial control prohibitions, as discussed above, but also by differences in the distinct statutory schemes of which they are a part.  y_3g104.` ` The "leased access" provisions of the Cable Act` L nZH""ԍXSee 47 U.S.C. 532(a), as amended.(#` were designed to open up a portion of capacity on monopoly cable systems to diverse sources of programming. As the District of  y_83Columbia Circuit explained in Time Warner: " ,0*&&((T#s"Ԍ  Leased access was originally aimed at bringing about "the widest possible diversity  y_3of information sources" for cable subscribers. Congress thought cable operators might deny access to programmers if operators disapproved of the programmer's social or political viewpoint, or if the programmers' offerings competed with those  y_`3the operators were providing.l` nZ"ԍXSee Time Warner, 93 F.3d at 968. (#l  y_3    When Congress amended the Cable Act in 1992, it added a second rationale for the leased access  y_3requirement: "to promote competition in the delivery of diverse sources of video programming."dXL nZ "ԍXSee 47 U.S.C. 532(a), as amended.(#d Thus, the leased access provision was designed to carve out a space on cable systems specifically for the purpose of creating a "soap box" of sorts, where different community viewpoints could be aired without the threat of censorship by the cable operator based on the "programmer's social or political  y_H 3viewpoint, or if the programmers' offerings competed with those the operators were providing."-XH L nZ"ԍXTime Warner, 93 F.3d at 968; H.R. Rep. No. 934, 98th Cong., 2d Sess. 48 (1984) (recognizing that cable operators have market power to exclude programming that "competes with a program service already being provided by that cable system").(#- Given that purpose, it made perfect sense to impose a firstcome, firstserved system for allocating the setaside capacity, and to deny the cable operator any authority to screen out or select certain speakers  y_ 3or certain content. L nZx"ԍXSee Leased Access Implementation Order, 12 FCC Rcd 5267, 5316. (#Ɗ To do otherwise would have given the monopoly cable operator the power to  y_ 3choose its "competitors," thereby largely defeating the purpose of the setaside.    y_X3h105.` ` Section 335 has a decidedly different purpose. It furthers the historic Congressional and Commission policy of carving out a haven for educational and informational programming that need not compete with commercial offerings and that can operate free of commercial imperatives to  y_3maximize audience size.kL nZ"ԍXSee Time Warner, 93 F.3d at 976.(#k In the Time Warner decision, the D.C. Circuit viewed the DBS setaside as "nothing more than a new application of a wellsettled government policy of ensuring public access to  y_3noncommercial programming."( L nZX"ԍXTime Warner, 93 F.3d at 976 (the court cautioned that "the government does not dictate the specific  nZ "content that DBS operators are required to carry").(# The court reviewed the history of Congressional initiatives to reserve spectrum for educational program services and protect those services from "commercial  y_@3pressures."@ L nZ`""ԍXId., citing FCC v. League of Women Voters, 468 U.S., 364, 367 (1984).(#Ɗ  y_3i106.` ` Because the language and legislative purposes of the two statutory schemes are different, we conclude that we are not compelled to implement the DBS and leased access prohibitions"-0*&&((s" in exactly the same way. This is particularly the case in light of the fact that the provisions governing cable leased access had not been interpreted by the Commission prior to passage of the 1992 Cable Act. When Congress adopted the DBS setaside and its editorial control prohibition in 1992, the leased access prohibition did not have the settled meaning now ascribed to it. It was only in 1997 that  y_`3the Commission interpreted the leased access provision as banning selection of programmers.r`L nZ"ԍSee Leased Access Implementation Order, 12 FCC Rcd at 5316.r Thus, in adopting the editorial control language applicable to DBS licensees, Congress did not do so with the expectation that it would be interpreted as broadly as we have interpreted the cable leased access provisions.  y_3j107.` ` Moreover, as a policy matter, we do not think it wise to interpret the editorial control prohibition more broadly than the statutory language requires. While the DBS setaside has been  y_H 3upheld in the face of a facial First Amendment challenge,OH XL nZ@ "ԍXSee Time Warner.(#O we must nevertheless be sensitive in implementing the statute to the First Amendment rights of DBS providers to create a highquality program service as well as the First Amendment rights of noncommercial programmers to exercise editorial control over their programming. If we were to deny DBS providers the power to select the national educational programming suppliers who will be able to utilize the reserved channels, then when demand for the channels exceeds capacity, such suppliers would either have to be selected  y_X3without regard to the content of their programming  i.e., on a firstcome, firstserved basis or by random selection or through some other mechanism such as the third party approach advocated by some of the commenters. We do not believe that the former method is likely to result in the best possible service to the public. And, we see little advantage in simply transferring to a third party the power to select programmers even if we could determine who that third party should be.  y_h3k108.` ` Most importantly, we do not believe that the purpose of the DBS channel reservation would be frustrated by permitting DBS providers to select among qualified programmers when the reserved channels cannot accommodate all eligible programmers who wish to use the channels. To the contrary, the Congressional purpose will be furthered by allowing DBS providers to ensure that their subscribers receive educational and informational programming that will serve their needs and interests. The interpretation we adopt today will allow them to do so. At the same time, our interpretation will further the purpose of the statute to shield noncommercial programmers who utilize the reserved channels from commercial pressures that might be brought to bear on them if the DBS provider could require them to provide specific programs or interfere with their editorial discretion over programming. A few commenters suggest that if DBS providers are allowed to select programmers, they will favor widelydistributed programming services that are already carried on DBS systems or that otherwise have wide audience appeal, and that programmers whose services are  y_3designed for smaller or "niche" audiences will be disfavored.L nZ#"ԍXSee Reply Comments of Research TV at 16; Comments of the Consortium for School Networking and International Society for Technology in Education, Summary at 12. (# We are not willing to assume that DBS operators acting to serve the needs of their subscribers will choose programmers that only appeal"`.@0*&&((x!s" to mass audiences. Moreover, we find nothing in the statute or its legislative history, indicating any concern by Congress that one class of eligible programmers might be favored over any other.  y_3l109.` ` We emphasize that in recognizing that DBS operators have the power to select among qualified program suppliers, we do not intend to prevent the operators from electing to use a consortium or clearinghouse of educators and public interest specialists to choose among qualifying  y_3programs that would be aired on the setaside capacity.L nZx"ԍXSee, e.g., Knowledge TV Reply Comments at 5; Primestar Reply Comments at 19; SBCA Comments at 2022.(#Ʃ We believe that, if feasible, the creation of such a clearinghouse could benefit the industry and the public. A clearinghouse would have the greatest benefit to the public if it is composed of diverse members, including educators, community leaders, nonprofit programmers, children's advocates and public broadcasters. Such membership should ensure access to the reserved capacity by a broad and diverse group of qualifying programmers.  y_ 3m110.` ` With regard to qualifications, we recognize that someone must make the determination that programmers who wish to use the reserved channels are eligible under the statute to do so and that the programming carried on the reserved channels qualifies under the statute as noncommercial programming of an educational or informational nature. We think that Congress intended that DBS providers make these determinations. Accordingly, we find that DBS providers should be responsible  y_X3for ensuring that the obligations imposed by the statute are fulfilled.bX L nZ"ԍXSee para. 1532, supra.(#b In order to avoid undue intrusion into the programming decisions of qualified programmers, however, we do not believe that it would be appropriate for DBS providers to prescreen all programming carried on the reserved channels. Rather, if an abuse of the reserved channels by a particular programmer comes to the DBS provider's attention, it can then take action to ensure that only qualified programs are carried on the reserved channels by that programmer in the future.  y_@3  n111.` ` This approach is consistent with the Second Circuit's recent interpretation of Section 611 of the Communications Act, which allows franchising authorities to require that cable channels be reserved for "public, educational, or governmental use," and prohibits cable operators from exercising editorial control  y_3over any channels so provided.% nZ"ԍXSee Time Warner Cable of New York City v. Bloomberg L.P., 118 F.3d 917, 928 (2d Cir. 1997). (#ơ In construing that provision, the Second Circuit reasoned:   Congress could not have authorized cities to require cable system operators to allot PEG channels to them and at the same time have left cities free to use these allotted channels for purposes beyond the scope of PEG purposes. . . . Having established the required category, Congress must have expected that the contracting party would be able to make sure that a city was not exceeding the scope of what Congress permitted a city to require. . . . [C]able"/@0*&&((s" operators may enforce the boundaries of the categories they are obliged to offer municipalities  y_3at no charge without violating [the editorial control prohibition].Mm2 nZ@"ԍXId. at 92829.(#M    The same reasoning applies to the DBS provision. Thus, DBS providers may reject programmers or programming that they believe in good faith are ineligible under the statute to use the reserved channels. Of course, if a noncommercial programmer believes that a DBS provider has misinterpreted the eligibility requirements or abused its discretion, it can always file a complaint with the Commission.  y_3o112.` ` In addition, we believe that a DBS provider can set technical quality standards for programming carried on its satellite system that can be applied to all programming, including that carried on the setaside channels. We do not believe that evenhanded application of technical quality standards amounts to "editorial control" of programming content.  y_ 3p113.` ` In the 1993 NPRM, the Commission also asked whether a DBS provider can refuse carriage or restrict dissemination of programs on the reserved channels as cable providers can under  y_ 3Section 532 of the Act. XL nZx"ԍXSection 532 permits a cable operator to exclude from leased access channels any programming that the operator "reasonably believes" is indecent. 47 U.S.C.  532(h). (# We agree with DAETC that there is no basis in the law for the Commission to carve out a similar exception for DBS providers for programming carried on the reserved channels  y_03that is "indecent" or otherwise illegal.F0L nZ"ԍDAETC Comments at 20.F The cable statute expressly authorizes cable operators to  y_3refuse to carry "indecent programming."W@L nZ"ԍXSection 612 (c)(2) of the Act.(#W The DBS provision contains no such allowance. In light of the statutory prohibition on exercising editorial control, Section 335 does not appear to allow DBS operators to refuse to carry any particular program unless it does not qualify for carriage under Section 335.  y_@3 q114.` ` In sum, consistent with our interpretation of Section 335, DBS providers will be required to make capacity available only to qualified programmers and they may select among such programmers when demand exceeds the capacity of their reserved channels. They may not, however, require the programmers they select to include particular series or programs on their channels. Nor may they alter or censor the content of the programming or otherwise exercise any control over the programming. As we note above, we expect that DBS providers will begin expeditiously to air  y_P3educational and informational programming.tPL nZ""ԍXSee Section IV C. B., supra.(#t To aid in monitoring and enforcing the obligations of DBS providers, we will require them to maintain files available for public inspection concerning use of  y_3the reserved capacity. T hese files should identify the entities that request access, the entities to whom noncommercial capacity is being provided, the amount of capacity being provided to each entity, the"0` 0*&&((s" conditions under which it is being provided and the rates, if any, being paid by the entity, and, when access is denied, a brief description of the reason or reasons why access was denied. This will permit the Commission and the public to monitor compliance with the requirements of Section 335(b). It will also provide the entities eligible for Section 335(b) capacity with a central source of information regarding what capacity is available.   y_" b. ` ` Noncommercial channel limitation.   y_3r115.` ` Several commenters suggest that the Commission limit the amount of set aside  y_3capacity allocated by DBS providers to individual national educational programming suppliers.L nZ "ԍXSee ASkyB Comments at 19; Alliance Comments at 14; Research TV Comments at 1920; DAETC Comments at 1617.(#Ʃ For example, ASkyB argues that in order to promote production of additional programming, providers should be allowed to devote no more than half of their setaside capacity to existing services such as  y_ 3PBS, CSpan, and the Learning Channel.F L nZ"ԍASkyB Comments at 19.F DAETC similarly argues that the Commission should limit  y_ 3programmer access to one channel per DBS system.I L nZH"ԍDAETC Comments at 1617.I PBS, however, opposes limiting the reserved  y_ 3channels controlled by any one programmer.K @L nZ"ԍ APTS/PBS Reply Comments at 1213.K   y_ 3s116.` ` In order to ensure that access to noncommercial channels is not dominated by a few national educational program suppliers, we limit to one the number of channels that can be initially allocated to a single qualified program provider on each DBS system. We find that limiting the amount of setaside capacity a DBS provider can allocate to a single qualified noncommercial programmer will promote increased development of quality educational and informational programming for carriage on the setaside channels. Prohibiting a DBS provider from initially allocating more than one setaside channel to a single programmer will increase the opportunity for other qualifying, nonaffiliated national educational programming suppliers to gain access. This will make available to the U.S. viewing public a greater variety of educational and informational programs and will provide an opportunity for carriage of programming that might not otherwise be shown such as programming directed at traditionally underserved audiences.  y_3t117.` ` Imposition of this limitation, we believe, is amply justified by Congress's intention to foster through Section 335(b) a robust and editorially diverse noncommercial educational programming service. Section 335(a) requires the Commission to "impose . . . public interest or other requirements for providing video programming." As traditionally interpreted in the broadcast and cable context, the"(10*&&((s"  y_3public interest is served by affording the public diverse programming.L nZh"ԍXIn making initial licensing decisions between competing applicants, the Commission has long given "primary significance" to "diversification of control of the media of mass communications" . . . .  nZ"National Citizens Committee for Broadcasting v. FCC, 436 U.S. 7754, 795 (1978). The Commission stated that the fundamental purpose of the multiple ownership rules is "to promote diversification of program and service viewpoints as well as to prevent any undue concentration of economic power  nZP"contrary to the public interest." Amendment of Section 3.35, 3.240 and 3.636, 18 FCC Rcd. 288 (1953).(#Ƽ In addition, as discussed in detail above, paras. 108113, we have not construed Section 335(b)'s prohibition on licensee editorial control over the reserved channel programming to be as expansive a prohibition on licensee discretion as the similar statutory ban on cable operators' control over cable leased access channels. Nevertheless, we believe that it is reasonable to infer that Section 335(b) reflects Congress' desire that this setaside capacity be a forum for a range of noncommercial voices that otherwise might not be heard. We believe it would frustrate Congress' goal to permit the setaside capacity to be dominated by a single programming voice where there are other noncommercial voices seeking to be heard. The modest channel limitation that we adopt today will further that congressional objective. As noted above, the channel limitation may foster program services serving a variety of educational needs by ensuring access to more national educational programming suppliers. Each of those suppliers will bring unique resources, editorial perspectives, and expertise to their programming services. Accordingly, we believe that this reasonable limitation will complement and enhance the statutory scheme envisioned in Section 335(b), as well as serve the overall public interest objectives in Section 335(a).   y_ 3u118.` ` In order to ensure that a particular programmer will be allowed access to only one channel, we will require that individual programmers, in fact, be separate entities. If two national educational programming suppliers are directly or indirectly under common control or ownership, we will treat them as one entity for purposes of obtaining access to the reserved channels. In applying this provision, we will define cognizable ownership and other interests according to our Commission's  y_3broadcast attribution rules.>@L nZ"ԍ XSee 47 C.F.R.  73.3555 note 1 & 2. The Commission is currently reviewing the broadcast attribution rules to determine whether they should be modified in certain respects to make them more precise and  nZ("clear. See Further Notice of Proposed Rule Making in MM Docket Nos. 94150, 9251 & 87154, 11 FCC Rcd 19895 (1996). We expect any modifications made in this proceeding will also apply in determining whether two national educational programming suppliers are separate entities.(#> These rules seek to identify those interests in, or relationships with, an entity that confer on their holders a degree of influence or control such that the holders have a realistic potential to affect the programming decisions of the entity or other core operating functions. As such, we believe they can appropriately be applied in the context of determining whether two national educational programming suppliers are separate entities.  y_3v119.` ` To meet its obligations under the channel cap we adopt here, a DBS operator cannot initially select a qualified programmer to fill more than one of its reserved channels. If, after all qualified entities that have sought access have been offered access on at least one channel, a provider may allocate an additional channel to a qualified programmer without having to make additional efforts to secure other qualified programmers. We believe this approach will assure that a variety of"(2 0*&&((s" noncommercial programmers have an opportunity to obtain access while ensuring that these channels  y_3are used as intended.   y_"c. Liability for Violations  y_83w120.` ` Commenters have raised the issue of whether DBS providers can be held liable for the content of the programming aired on the setaside channels. For example, Primestar argues that the absence of an explicit immunity provision in Section 335 renders them vulnerable to civil and criminal liability as a result of the programming, and thus requires that DBS providers be able to  y_3choose among qualified programmers.rL nZ "ԍXPrimestar Ex parte Presentation, December 12, 1997.(#r MAP, on the other hand, argues that, under applicable precedent, the Commission can find that Section 335 implicitly grants DBS providers immunity from  y_H 3liability for programming over which they have no control.H XL nZ@ "ԍXSee September 29, 1998 Ex Parte filing by Media Access Project.(#Ɗ Because Section 335 prohibits DBS providers from exercising any editorial control over programming utilizing the reserved channels, we  y_ 3interpret the statute in accordance with the Supreme Court's holding in Farmers Educational and  y_ 3Cooperative Union of America v. WDAY,] L nZX"ԍX360 U.S. 525 (1959) (Farmers Union).(#] as immunizing the DBS providers from liability under state and local laws as a result of the content of the programming.  y_X3x121.` ` In Farmers Union, the Supreme Court held that Section 315 of the Act bars broadcasters from censoring defamatory statements made during political broadcasts that they are required by the statute to carry, and therefore implicitly grants them federal immunity from liability for such statements. The fact that Congress did not explicitly grant such immunity by statute was not dispositive. The Court found that the grant of immunity was implicit in the statute because imposing liability for programming broadcasters could not censor "would sanction the unconscionable result of permitting civil and perhaps criminal liability to be imposed for the very conduct the statute demands  y_@3of the licensee."I@xL nZX"ԍX360 U.S. at 531.(#I The same principle applies here. Section 335(b) prohibits DBS providers from exercising "any editorial control" over noncommercial programming using the setaside capacity, and thus implicitly grants them immunity from liability under state and local law for distributing such programming. By the same token, we will enforce any requirements imposed by the Act or our rules, other than these public interest obligations, against the programmers who supply such programming,  y_x3rather than the DBS providers who carry it under Section 335. X` hp x (#%'0*,.8135@8:0*&&((s"  y_" SEPARATE STATEMENT OF COMMISSIONER MICHAEL K. POWELL  y_"*DISSENTING IN PART lV  y_3XVRe:Implementation of Section 25 of the Cable Television Consumer Protection and Competition Act of 1992; and Direct Broadcast Satellite Public Interest Obligations (MM Docket No. 9325).(# XV(# XV(# We have been asked to implement various mandates Congress imposed on Direct Broadcast Satellite (DBS) operators as part of the 1992 Cable Act. In most parts of this order, I believe that we have implemented the will of Congress and I fully support those portions of the order. To my mind, however, in one part of the order, the majority is not implementing the will of Congress, but inventing it. Because I am unwilling to speculate in order to regulate, I respectfully dissent from that portion of the item. As an initial matter, let me briefly address the issue of Editorial control. Although I understand and respect that others may have different interpretations of the statute, I believe, for the reasons explained in the order, that our interpretation of the statute is faithful to Congress' intent and will produce the best result for the American people. My judgement in this regard is buoyed by the fact that the results produced by any other interpretation of the statute strike me as either unworkable or overly intrusive. For example, alternatives such as a subscriber survey strike me as administratively burdensome. Indeed, I have great difficulty imagining how such a process would work. Other alternatives suggested by the commenters, such as the proposal to require some third party decisionmaker, smack of undue government intrusion contrary to our principles of free speech. The only other obvious alternative, requiring some form of firstcome, firstserved access, is unlikely to produce the best use of this valuable spectrum.  This leads me to the aspect of this decision from which I must respectfully dissent, the portion of the decision that imposes an initial limit of one channel per DBS system for each national educational programming supplier. In my view, this is an artificial limitation not called for by the statute nor needed as a policy matter. With regard to the law, I note that on its face, the statute seeks to ensure that a type of programming ! noncommercial educational and informational programming ! is available to the American people subscribing to DBS service. Nothing in the statute indicates that the FCC should go beyond ensuring that DBS operators make capacity available for such  y_3programming to also adopt rules about who will provide the programming. Rather, so long as the DBS operator makes the capacity available to programmers that fall within the category of programmers specified by Congress and those programmers provide the type of programming contemplated by the statute, the congressional intent will be fulfilled. We need go no further. I also object to this limitation as a matter of policy. This rule is overregulatory and depends upon speculative conclusions that government intrusion is necessary to ensure diversity and variety on these channels. I see no basis for such a conclusion. Each of the DBS operators offering service today provides a wide variety of programming that runs the gamut from entertainment to news, information and instruction. These operators clearly have found that diversity in programming helps to gain subscribers some seven million or so and growing. Given this dynamic in the industry, I see no" %?0*&&(((s" reason to intrude. Under these circumstances, I cannot support this limitation and will respectfully dissent from this portion of the order. "@0*&&((s"  y_3 STATEMENT OF COMMISSIONER GLORIA TRISTANI, DISSENTING IN PART ă  y_3 In the Matter of Implementation of Section 25 of the Cable Television Consumer Protection and Competition Act of 1992,  y_`3Direct Broadcast Satellite Public Interest Obligations, MM Docket No. 9325ĐlV My disagreement with the majority centers on the following sentence in Section 335(b)(3): "The provider of direct broadcast satellite service shall not exercise any editorial control over any video programming provided pursuant to this subsection." The majority believes that this sentence can  y_p3be read to give DBS operators complete freedom in selecting and renewing video programmers to use the setaside capacity without violating the prohibition on the exercise of any editorial control over any  y_ 3of the video programming that is shown. I do not. The majority's position depends upon a basic fiction: that nothing that occurs between a DBS operator and a programmer amounts to "editorial control" over the actual programming that is provided to subscribers so long as the programmer formally retains the right to run the programming of its choice. Thus, according to the majority, a DBS operator could: (1) decide which programmers to carry based on specific programming lineups; (2) discuss with programmers the particular programs that will be carried and when; and (3) terminate a programmer because it did not like the content of the programmer's offerings. In the majority's view, none of this would amount to any editorial control by the DBS operator so long as the programmer is permitted, as a legal matter, to make the final decision about what programming will be run. This fiction cannot withstand scrutiny. First, it defies reality to argue that the editorial slate is somehow "wiped clean" after a carriage agreement is signed. For instance, assume that a DBS operator is choosing between two qualified children's programmers PBS, which carries Sesame Street, and a startup children's channel, which carries a similar program called Poppy Street. If the DBS operator chooses to carry PBS rather than the startup, it seems selfevident to me that the  y_x3operator has exercised some editorial control over whether its subscribers will see Sesame Street or Poppy Street. True, under the majority's view PBS could drop Sesame Street from its lineup and the DBS operator would have no legal recourse to stop them. But such changes will likely be rare. Many national programming services have established channel lineups that are relatively stable as programmers attempt to develop viewer loyalty and brand identity. More importantly, no programmer will want to antagonize the entity that has sole control over whether its carriage contract will be renewed by reneging on programming commitments made during the selection process. Indeed, since the majority has not prescribed any minimum duration for carriage contracts, a DBS operator could keep programmers on a short leash by only entering into shortterm contracts. But even assuming that a programmer occasionally exercises independent editorial judgment contrary to the DBS operator's wishes, the majority's scheme would still run afoul of the statute. The  y_H$3statute does not prohibit DBS operators from exercising complete editorial control over all of the video  y_ %3programming on the setaside capacity, but from exercising any editorial control over any such" %A0*&&(((s" programming. Thus, the statute is violated even if a DBS operator only exercises the slightest editorial control over a single program on a single channel. Since, as a practical matter, the DBS operator is bound to have some influence over some of the programming that is shown, in the end the majority's argument depends upon the proposition that a  y_83programmer's legal right to ignore the DBS operator's wishes is enough to satisfy the statute even if  y_3that right is not exercised. This is like saying that a television network exercises no editorial control over the programming that viewers see because its affiliates may have the legal right to preempt any particular show. It also has a certain throughthelookingglass logic: the party that chooses the programming that subscribers see does not exercise any editorial control over what subscribers see; the only party exercising editorial control over what subscribers see is the one that could choose what subscribers see, but does not. If the majority were serious about its programmerprogramming distinction, it would need to provide far more detailed rules on permissible conduct before, during and after the setaside selection process. It is not enough to leave these issues to casebycase determinations; these are issues that every DBS operator and every programmer need resolved before they can do business. On termination issues, alone, for instance, a whole host of issues present themselves. Can a DBS operator require programmers to sign "at will" contracts and simply terminate a programmer if they do not like its content? If not, how long do contracts have to run? Six months? A year? Five years? What are acceptable reasons for nonrenewal? Can it be based on dislike of particular content, or only on a desire to change from, say, a children's channel to distance learning? Instead of the majority's complicated fiction, I would have adopted a simpler approach. Congress clearly intended that a sliver of the DBS operator's spectrum be set aside for programming free from the operator's control. In practice, the only way to accomplish that directive is to prohibit the DBS operator from deciding which programmers will occupy the setaside capacity. This need not be a burdensome process, nor need it deprive subscribers of the qualified programming they would find most attractive. I think it would be acceptable under the statute, for example, for the DBS operator to create a list of qualified programmers seeking carriage and then to survey its subscribers about the programming they would prefer. A subscriber survey would be quick and easy to administer, would create an attractive setaside package and, most importantly, would remove any question about the DBS operator exercising editorial control. Although today's Order in no way requires such an approach, neither is it precluded and it may help insulate a DBS operator from charges of improper editorial influence."B0*&&((s" X` hp x (#%'0*,.8135@8: