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If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 In re Applications of ) ) BENEDEK LICENSE CORPORATION ) (Assignor) ) ) and ) File No. BALCT-990106IA ) File No. BALTT-990106IB ) AK MEDIA GROUP, INC. ) (Assignee) ) ) For Consent to the Assignment of License of) Station KCOY-TV, Santa Maria, California) and K45DN, Paso Robles, California) ) AK MEDIA GROUP, INC. ) (Assignor) ) ) and ) File No. BALCT-910106IC ) File No. BALTT-990106IE ) File No. BALTTV-990106ID ) BENEDEK LICENSE CORPORATION ) (Assignee) ) ) For Consent to the Assignment of License of) Station KKTV(TV), Colorado Springs, ) Colorado, Station K57CB, Romeo, Colorado ) and Station K10KI, Canon City, Colorado) MEMORANDUM OPINION AND ORDER Adopted: April 16, 1999 Released: April 21, 1999 By the Chief, Mass Media Bureau: 1. The Commission, by the Chief, Mass Media Bureau, acting pursuant to delegated authority, has before it for consideration the above-captioned unopposed applications for assignment of license of KCOY-TV, Channel 12 (CBS), Santa Maria, California, and television translator station K45DN, Paso Robles, California, from Benedek Broadcasting Corporation (Benedek) to AK Media Group, Inc. (AK Media), and the assignment of license of KKTV(TV), Channel 11 (CBS), Colorado Springs-Pueblo, Colorado, and television translator stations K57CB, Romeo, Colorado and K10KI, Canon City, Colorado, from AK Media to Benedek. 2. AK Media is the licensee of KGET(TV), Channel 17 (NBC), Bakersfield, California, whose Grade B contour overlaps the Grade A contour of KCOY-TV, the station to be acquired by AK Media. Common ownership of stations with such overlap violates the Commission's television duopoly rule, 47 C.F.R.  73.3555(b). Accordingly, AK Media has requested a waiver of the television duopoly rule to permit common ownership of KGET(TV) and KCOY-TV, conditioned on the requirement that AK Media come into compliance with the outcome of the pending television ownership rulemaking proceeding. Duopoly Waiver Showing 3. As demonstrated in AK Media's engineering report, the predicted contour overlap of KGET(TV) and KCOY-TV encompasses 3,602 square kilometers and 23,442 individuals. This represents 17.4% of the area and 3.7% of the population within the Grade B contour of KCOY-TV, and 19.7% of the area and 4.3% of the population within the Grade B contour of KGET(TV). The stations' Grade A contours do not overlap. AK Media further notes that the stations are assigned to different Designated Market Areas ("DMAs"): KCOY-TV to the Santa Barbara-Santa Maria-San Luis Obispo DMA, ranked 115th, and KGET(TV) to the Bakersfield DMA, ranked 131st. AK Media also submits the declaration of the KGET(TV) general manager stating that the Bakersfield DMA is separate and distinct from the Santa Barbara-Santa Maria-San Luis Obispo DMA for the purpose of advertising sales. 4. AK Media further maintains that the proposed combination presents no basis for departing from the Commission's interim duopoly policy. As an initial matter, AK Media notes that the extent of the overlap falls within the range of overlaps previously approved by the Commission. Additionally, AK Media asserts that the availability of a multitude of media voices in the overlap area demonstrates that common ownership of the Bakersfield and Santa Maria television stations will not adversely affect competition or diversity. According to AK Media, 11 television stations (excluding KCOY-TV and KGET(TV)) provide Grade B or better service to all or part of the overlap area. In addition, AK Media states that listeners in the overlap area are served by numerous radio stations, including at least 13 AM and 35 FM stations which are licensed to communities that are within the Santa Barbara-Santa Maria-San Luis Obispo and Bakersfield markets. As to non-broadcast media, AK Media states that cable penetration is 82% in the Santa Barbara-Santa Maria-San Luis Obispo DMA and 73% in the Bakersfield DMA, and identifies six daily newspapers serving counties within the overlap area. Furthermore, AK Media represents that, while certain administrative support services may be provided to KCOY-TV by KGET(TV), both stations will maintain their own local sales, programming and news staffs. Discussion 5. In adopting the duopoly rule's fixed standard of prohibiting overlap of Grade B service contours, the Commission also acknowledged the need for "flexibility" in that rule's application, noting that waivers should be granted where rigid conformance to the rule would be "inappropriate." Multiple Ownership of Standard, FM and Television Broadcast Stations, 45 FCC 2d 1476, 1479 n.12, recon. granted in part, 3 RR 2d 1554 (1964). To that end, the Commission has developed the following set of factors to be considered when evaluating an applicant's request for waiver of the duopoly rule: the extent of the overlap; the number of media voices available in the overlap area; the distinctiveness of the respective markets; the independence of the stations' operations; and the concentration of economic power resulting from the combination. See Iowa State University Broadcasting Corporation, 9 FCC Rcd 481, 487-88 (1993), aff'd sub nom. Iowans for WOI-TV, Inc. v. FCC, 50 F.3d 1096 (D.C. Cir. 1995); H&C Communications, Inc., 9 FCC Rcd 144, 146 (1993). After weighing the factors, the Commission considers any public interest benefits proposed by the applicant to determine whether, in light of the overlap, the benefits outweigh any detriment which may occur from grant of the waiver. See, e.g., Iowa State University, 9 FCC Rcd at 487-88. As with any waiver, it will only be granted if the Commission concludes that the waiver is in the public interest. 6. Currently, the Commission is reexamining its broadcast television ownership policies, including the duopoly rule. In January 1995, the Commission proposed a new analytical framework within which to evaluate its broadcast television ownership rules. See Review of the Commission's Regulations Governing Television Broadcasting, Further Notice of Proposed Rule Making, 10 FCC Rcd 3524 (1995) ("Television Ownership Further Notice"). Subsequent to the release of the Television Ownership Further Notice, Congress directed the Commission to conduct a rulemaking proceeding to determine whether to retain, modify or eliminate existing limitations on the number of television stations that an entity may control within the same television market. See Section 202(c) of the Telecommunications Act of 1996, Pub. L. No. 104-104, 110 Stat. 56 (Feb. 8, 1996) ("Telecom Act"). In response to this Congressional directive in the Telecom Act and to update the record, the Commission released the Review of the Commission's Regulations Governing Television Broadcasting, Second Further Notice of Proposed Rule Making, 11 FCC Rcd 21655 (1996) ("Television Ownership Second Further Notice"). 7. The Commission stated in the Television Ownership Second Further Notice that it will be inclined, during the pendency of the television ownership proceeding, to grant temporary duopoly waivers to authorize common ownership of television stations that are in separate DMAs and whose Grade A contours do not overlap, conditioned on coming into compliance with the outcome of the proceeding within six months of its conclusion. It also noted there its tentative conclusion that the record in that proceeding "supports relaxation of the geographic scope of the duopoly rule from its current Grade B overlap standard to a standard based on DMAs supplemented with a Grade A overlap criterion." Television Ownership Second Further Notice, 11 FCC Rcd at 21681. The Commission further stated that "we do not believe granting waivers satisfying the proposed standard, and conditioning them on the outcome of this proceeding, will adversely affect our competition and diversity goals in the interim." Id. 8. With respect to the proposed common ownership of KCOY-TV and KGET(TV), we believe that grant of a conditional waiver of the duopoly rule, subject to the outcome of the pending ownership rulemaking, is justified. The temporary common ownership of the Santa Maria and Bakersfield stations would be consistent with the interim policy set forth in the Television Ownership Second Further Notice, as the stations are in separate DMAs and there is no Grade A signal contour overlap between them. Moreover, our examination of the record presented here reveals nothing suggesting that we should not follow the established interim policy in this case. The extent of the Grade B overlap, although not de minimis, falls well within the range of those we have approved in previous cases. We note also that the stations are affiliated with different national networks and serve different markets. Additionally, numerous broadcast stations will continue to provide service to the overlap area after the proposed assignment. Accordingly, we conclude that grant of a temporary waiver, conditioned on AK Media coming into compliance with the outcome of the pending television ownership rulemaking proceeding within six months of its conclusion, will serve the public interest, convenience and necessity. Any request to extend this conditional waiver should be filed at least 45 days prior to the end of the six-month period and would be closely scrutinized. Conclusion 9. Having determined that the applicants are qualified in all respects, we find that grant of the above-captioned applications will serve the public interest, convenience and necessity. 10. Accordingly, IT IS ORDERED, That the request for waiver of the Commission's duopoly rule, 47 C.F.R.  73.3555(b), to allow common ownership by AK Media Corporation of KCOY-TV, Santa Maria, California, and KGET(TV), Bakersfield, California, IS GRANTED, subject to the outcome of the Commission's pending broadcast television ownership rulemaking in MM Docket Nos. 91-221 and 87-8. Should divestiture be required as a result of that proceeding, the licensee is directed to file, within six months from the release of the final order in MM Docket Nos. 91-221 and 87-8, an application for Commission consent to dispose of such station as would be necessary for the licensee to come into compliance with the rules as provided in the final order. 11. IT IS FURTHER ORDERED, That the applications for assignment of license of KCOY-TV, Santa Maria, California, and television translator station K45DN, Paso Robles, California, to AK Media Group, Inc., and the assignment of license of KKTV(TV), Colorado Springs-Pueblo, Colorado, and television translator stations K57CB, Romeo, Colorado and K10KI, Canon City, Colorado, to Benedek License Corporation ARE GRANTED. FEDERAL COMMUNICATIONS COMMISSION Roy J. Stewart Chief, Mass Media Bureau