Before the Federal Communications Commission Washington, D.C. 20554 In the Matter of ) ) TRANSMISSIONS HOLDINGS, INC. ) ) Petition For Waiver of Sections 101.603(a) ) and (b) of the Commission's Rules for sites ) at Cherry Tower and Aurora Medical Center ) in or near Denver, Colorado. ) ORDER Adopted: March 9, 1999 Released: March 10,1999 By Deputy Chief, Wireless Telecommunications Bureau and Chief, Cable Services Bureau: I. INTRODUCTION 1. Before us are two Petitions for Waiver filed by Transmissions Holdings, Inc. (THI) (THI Waiver Requests)1 on February 12, 1998, seeking waivers of Sections 101.603(a) and (b) of the Commission's Rules to permit THI to use frequencies in the 12.7005 GHz - 13.1445 GHz band (12 GHz band). The 12 GHz band is primarily allocated for use by the Cable Television Relay Service (CARS). THI desires to use the 12 GHz band for fixed point-to-point microwave transmission of video entertainment material on a private carriage basis.2 Section 101.603 of the Commission's Rules prohibits private operational fixed service (POFS) microwave licensees from transmitting video entertainment material in this band.3 Based on the record in this proceeding, we conclude that THI's Waiver Requests should be granted. II. BACKGROUND 2. Pursuant to Section 101.23 of the Commission's Rules, Transmission Holdings, Inc. ("THI") has requested waivers of Sections 101.603(a) and (b) of the Commission's Rules to allow THI to modify its POFS microwave stations at Cherry Tower and Aurora Medical Center in or near Denver, Colorado, to transmit video entertainment material in the 12 GHz band. THI states that the subject facilities are part of its microwave relay system being constructed in the Denver area, and within a region designated as a "quiet zone" pursuant to Section 101.123 of the Rules.4 THI also has requested expedited treatment of its waiver requests because it is under contract to provide service using the subject facilities.5 3. Sections 101.603(a) and (b) of the Commission's Rules limit the frequencies in which POFS microwave licensees may transmit video entertainment material. THI asserts that in accordance with these rules, and until October of 1997, all of THI's microwave relay systems nationwide, including those in Denver, were constructed using 18 GHz microwave equipment and that these facilities are used to provide video and telecommunications services for private cable operations.6 4. On October 14, 1997, the Commission released an Order regarding the relocation of the Digital Electronic Message Service ("DEMS") from the 18 GHz to the 24 GHz band.7 The 24 GHz Order established new "quiet zone" rules for the 18 GHz band in order to protect Department of Defense facilities from interference.8 Under the new rules, no new applications will be accepted in the 17.8-19.7 GHz band within the Denver quiet zone.9 5. THI states that, as a result of the Commission's action in the 24 GHz Order, its two applications being prepared for its Cherry Tower and Aurora Medical Center facilities could not be granted for 18 GHz frequencies and THI had to look elsewhere for spectrum to serve its customers in Denver who already had contracted for service (including those served by the Cherry Tower facility).10 THI further states that it therefore filed its applications to modify the above-referenced facilities to use the 12 GHz band CARS frequencies in order to complete its video distribution system in the Denver area. In conjunction with its modification applications, THI has requested waivers of Sections 101.603(a) and (b) of the Commission's Rules to the extent that they prohibit the transmission of video programming services in the 12 GHz band.11 Section 101.603 provides, in relevant part, that stations licensed in this radio service shall not be used to provide the final RF link in the chain of transmission of program material except in the frequency bands 6425-6525 MHz, 18.142-18.580 MHz, and on frequencies above 21,200 MHz.12 III. DISCUSSION 6. Under Section 101.23 of the Commission's Rules, a request for a waiver of Part 101 of the rules may be granted if: (a) the underlying purpose of the rule will not be served or would be frustrated, by its application in the particular case, and grant of the waiver is otherwise in the public interest; or (b) the unique facts and circumstances of a particular case render application of the rule inequitable, unduly burdensome or otherwise contrary to the public interest.13 Applicants must also show the lack of a reasonable alternative.14 As discussed in further detail below, we find that THI has met the requirements of Section 101.23 of the Commission's Rules and that its Waiver Requests should be granted. 7. Unique Facts and Circumstances. THI argues that its circumstances are unique.15 Specifically, THI contends that the application of the video programming restrictions in Sections 101.603(a) and (b) in light of the 24 GHz Order will be inequitable, unduly burdensome, and contrary to the public interest in this circumstance.16 THI further states that private cable service delivered using private fixed microwave facilities appears to be the one segment of the market in which competition to the monopoly franchised cable operators is thriving.17 THI asserts that it was precisely for this reason that the Commission first opened the 18 GHz frequencies for the transmission of video entertainment material.18 As the Commission noted at that time, allowing POFS licensees to transmit video entertainment material "represents a significant step in furtherance of our effort to encourage more robust competition in the multichannel video delivery marketplace."19 8. THI states that because the 24 GHz Order closes 18 GHz spectrum to private cable operations, the ability of private cable operators that use microwave links in their systems to compete in the Denver and Washington, D.C. markets has been adversely affected in a significant manner.20 In this connection, THI indicates that absent grant of the instant waiver request, it might have to curtail operations in the greater Denver area.21 THI claims that it has not been able to identify any other frequency band that meets its operational and technical requirements, and in which frequency paths are available that correspond to its network plan.22 THI further asserts that grant of the Waiver Requests will help to foster competition in the video distribution market in the Denver area and thus serve the public interest.23 9. Further, THI argues that application of the Section 101.603 restrictions in this case would be inequitable because it has made a good faith investment in 18 GHz facilities in and around Denver in an effort to compete with the franchised cable operators in that area.24 THI states that it did not, and for the most part could not, anticipate that the Commission would virtually prohibit all 18 GHz private cable services in the Denver area.25 Further, THI states that its customers entered into contracts prior to the October 1997 rule changes that require THI to deliver cable programming to tens of thousands of subscribers in the Denver area.26 THI concludes that application of the Section 101.603 restrictions would thus deprive many people of video programming services and impose an enormous financial hardship on THI and its private cable customers.27 THI also contends that the 12 GHz band frequencies that are the subject of its applications are extremely lightly used in the Denver area.28 10. We find that THI has demonstrated unique circumstances in this case. Without the waiver, THI would have to apply for facilities in a frequency band other than 18 GHz in a very congested area on a frequency band which is allowable for non-common carriers to deliver video services and would have difficulty locating these alternative frequencies. With the waiver, THI could use only the 12 GHz CARS frequency band to accomplish all of its objectives. THI's efforts to complete its infrastructure in the Denver area must now account for the new 18 GHz restricted area around Denver established in the 24 GHz Order. We concur that grant of the requested waiver will help to promote competition in one of the most highly concentrated communications markets, local video distribution, without any countervailing sacrifice of spectrum efficiency.29 We find that THI has satisfied the requirements of Section 101.23 of the Commission's Rules by showing that the unique facts and circumstances of this case would render application of Section 101.603 contrary to the public interest. We find that the public interest would best be served by allowing THI to utilize 12 GHz band frequencies where 18 GHz links would normally have been utilized in these two locations. We believe the circumstances described herein are extraordinary, and limit this relief to the two subject applications and the associated waiver requests. 11. Reasonable Alternatives. Under the circumstances described, we conclude that the only reasonable alternative available to THI is to find other spectrum that is available for the provision of video entertainment material by private operational fixed microwave licensees outside of the 18 GHz band which it had originally intended to use. THI states that it could not locate any other bands except the 12 GHz band which was lightly used in the Denver area that would meet its operational and technical requirements. We have no evidence or indication to the contrary. Thus, we conclude that THI has made the requisite showing that no reasonable alternative exists. IV. CONCLUSION 12. We find that grant of THI's Waiver Request is warranted because THI has demonstrated that its unique facts and circumstances described herein would render application of Section 101.603 of the Commission's Rules contrary to the public interest. THI has also shown that no reasonable alternative exists. We therefore grant the Waiver Requests. V. ORDERING CLAUSES 13. Pursuant to authority contained in Sections 4(i) and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. ?? 154(i) and 303(r), and Section 101.23 of the Commission's Rules, 47 C.F.R. ? 101.23, IT IS ORDERED that the Petitions for Waiver filed by THI ARE GRANTED to the extent stated herein and shall become effective upon the release date of this order. 14. This action is taken pursuant to the authority delegated by Section 0.331 of the Commission's Rules, 47 C.F.R. ? 0.331. FEDERAL COMMUNICATIONS COMMISSION Kathleen O'Brien Ham Deputy Chief, Wireless Telecommunications Bureau Deborah A. Lathen Chief, Cable Services Bureau 1 THI submitted license applications for two facilities on January 20, 1998 (File No. 740174 for Aurora Medical Center and File No. 728211 for Cherry Tower) which are associated with the subject waiver requests. Special Temporary Authorizations (STAs) were granted jointly by the Wireless Telecommunications Bureau and the Cable Bureau on March 20, 1998, to allow THI to operate these facilities using the CARS band frequencies during the pendency of the waiver requests. The STAs also have been extended twice and currently are scheduled to expire on April 7, 1999. 2 THI filed Petitions for Waiver of Section 101.603 of the Commission's Rules on February 12, 1998, in support of its two applications in the Denver area. THI also submitted a Petition for Rulemaking of OpTel, Inc. on April 1, 1998, to allow use of the CARS band for delivery of video programming material for private operational fixed microwave service. 3 47 C.F.R. ? 101.603. 4 THI Waiver Requests at 1. 5 Id. As indicated in note 1 supra, THI has been providing service using the subject facilities since March 20, 1998, pursuant to STA. 6 Id. 7 See Amendment of the Commission's Rules to Relocate the Digital Electronic Message Service from the 18 GHz Band to the 24 GHz Band and to Allocate the 24 GHz Band for Fixed Service, ET Docket No. 97-99, Order, 13 FCC Rcd 3581 (rel. October 14, 1997)(24 GHz Order). 8 THI Waiver Requests at 2. 9 See 24 GHz Order, 13 FCC Rcd at 3582. 10 Id. 11 Id. 12 See 47 C.F.R. ? 101.603(b)(3). 13 See 47 C.F.R. ?101.23. 14 See 47 C.F.R. ?101.23(b). 15 THI Waiver Requests at 2. 16 Id. at 3. 17 Id. 18 Id. 19 See Amendment of Part 94 of the Commission's Rules to Permit Private Video Distribution Systems of Video Entertainment Access to the 18 GHz Band, Report and Order, 6 FCC Rcd 1270 (1991). 20 THI Waiver Requests at 3. 21 Id. 22 Id. 23 Id. 24 Id. 25 Id. 26 Id. at 3-4. 27 Id. at 4. 28 Id. 29 See Id. ?? Federal Communications Commission DA 99-407 Federal Communications Commission DA 99-407