February 22, 1994 FREQUENTLY ASKED QUESTIONS REGARDING CABLE TELEVISION REGULATIONS The Federal Communications Commission has adopted a number of rules regarding cable television as required by the Cable Television Consumer Protection and Competition Act of 1992 (the "Cable Act"). The following information answers some frequently asked questions about cable television regulation. Q: Does the FCC regulate all cable television rates? A: No. This authority is shared between the FCC and your local franchising authority, which is the local city, county, or other government organization that regulates your cable television service. The name of your local franchising authority should be on your cable bill. If it is not, contact your cable company or your local government. In most cases, your local franchising authority is responsible for regulating rates for basic cable service, equipment used to receive basic cable service, and installation and service charges related to basic service. "Basic service" is the lowest level of cable service you can buy, and is the program package that includes signals from local television stations (such as ABC, NBC and CBS affiliates and independent television stations) and public, educational and governmental access channels. Your cable company may use different terms to describe this service. If your local franchising authority chooses not to regulate basic cable service, your cable operator may charge what it chooses for basic cable service, associated equipment, and installation and service charges, including additional outlets. The FCC is responsible for regulating rates for cable programming services. This term includes all program channels on your cable system not included in basic service and not separately offered as pay-per-channel programming (for example, HBO or Showtime) or pay- per-program services (such as pay-per-view sports events). In general, cable programming services are the packages of channels you can buy once you have purchased basic service. Under the Cable Act, rates for pay-per-channel programming and pay-per-program services are not regulated by either local governments or the FCC. This means that your cable company can charge what it chooses for these services. Q: I thought that all cable rates would go down under the Cable Act. Why hasn't my rate changed? A: There could be a number of reasons why an individual subscriber's rates have not gone down. First, operators may have added services and service options for which they are entitled to charge a reasonable rate as defined in the FCC's regulations. Second, some operators, instead of reducing rates as required under the FCC's benchmark approach to cable rate regulation, may have elected to try to justify rates based on costs. Pending review by regulators of the operators' cost showing, operators may maintain current rates. Third, operators are only required to reduce rates if they become regulated by local franchising authorities or if the FCC receives a complaint. Subscribers to services offered by systems that are not regulated may not see rate reductions until the systems become regulated. FCC regulations limit future rate increases by regulated systems. Systems may generally increase rates only by inflation, plus external costs and other costs related to additional programming or system upgrades your cable company may choose to provide. As a result, the FCC's regulations will keep cable bills of regulated cable operators from increasing as rapidly as they may have in past years. Q: How can I tell if my cable company's rates are reasonable? A: Your local franchising authority is responsible for determining if your cable system's rates for basic cable service are unreasonable. You should contact your local franchising authority to determine if it has done so. The FCC is responsible for determining if the rates for cable programming services are too high. This determination is made only in response to complaints filed by consumers. If you want to find out if a complaint has already been filed against your cable system for cable programming services rates, you should call (202) 416-0919. Q: How can I file a complaint against my cable system's rates? A: If you want to complain about rates for either basic cable service, or equipment, installation and service charges related to basic service, contact your local franchising authority. Your local franchising authority will inform you of any procedures you must follow. If you want to complain about cable programming service rates, you must file a cable programming service complaint form with the FCC. To request this simple form, call the FCC at (202) 416-0919, or write to the Federal Communications Commission, Cable Form Request 329, P.O. Box 18238, Washington, D.C. 20036. Generally, you have 45 days after you receive the first bill reflecting the rate increase to file a complaint. There is one exception to this rule -- complaints regarding cable rates in effect on September 1, 1993, must be received at the Commission by February 28, 1994. Complaints about rates for pay-per-programming services and pay-per-view programs should be directed to your cable company, as neither the FCC nor your local franchising authority has the authority to regulate these rates. Q: Some cable operators are including an "FCC mandated adjustment" on cable bills, or are claiming that the FCC has required rate increases. Has the FCC required any cable companies to raise their rates? A: The FCC has not mandated any particular new charges nor has it required any cable companies to raise their rates. Q: My bill shows a "franchise fee." What is this? A: A franchise fee is a fee paid by the cable system to the local franchising authority for the right to provide cable service to subscribers in your community. The money collected goes to the franchising authority and not the FCC. If you have complaints regarding franchise fees, you should contact your local franchising authority. Q: My cable company charges a fee for late payment of bills. Are late fees regulated by the FCC? A: No. Late fees are regulated by your local franchising authority. Complaints about late fees should be directed to your local franchising authority. Q: I have complaints about my cable company's customer service and about its billing practices. Who should I contact? A: The FCC has developed general guidelines for customer service that deal with, for example, how quickly a cable operator must answer its phone or respond to requests for service, and how a cable bill should be written. It is up to your local franchising authority to enforce the guidelines in your community. Therefore, complaints about customer service and billing disputes should be directed to your local franchising authority. Q: My cable company says that the FCC has eliminated discounted rates to groups such as senior citizens. Is this true? A: No. FCC regulations specifically allow operators to provide discounts to senior citizens and members of economically disadvantaged groups (that is, individuals who receive federal, state or local welfare assistance). For further information regarding such discounts, you should contact your local cable company or your local franchising authority. Q: My cable operator tells me that now I have to use equipment which I didn't need before, such as a converter box or a remote control, and they want to charge me for the use of this equipment. Do I have to use their equipment and do I have to pay for it? A: Cable operators may require their subscribers to use specific equipment, such as converters, to receive the basic service tier. They may include a separate charge on your bill to lease this equipment to you on a monthly basis. This monthly rate must be based on the operator's actual costs of providing the equipment to you. Operators may also sell equipment to you, with or without a service contract. If an operator provides a choice between selling and leasing the equipment, the monthly leasing rate will be regulated but the sales price will be unregulated. If an operator only sells equipment and does not also lease equipment, then the sales price must be the actual cost of the equipment plus a reasonable profit, and any service contract should be based on the estimated cost to service the equipment. If the customer buys the equipment but does not purchase a service contract, the customer can be charged for repairs and maintenance. Cable operators may not prevent customers from using their own equipment if such equipment is technically compatible with the cable system. The rules require that charges for converters, remote controls, connections for additional televisions, and cable home wiring be listed separately on your bill. If you have a question about the rates your cable operator is charging for equipment, you should contact your local franchising authority. Q: Can the cable company charge for additional outlets? A: Operators may charge you a monthly fee to recover the cost of the wiring and parts installed and the estimated cost to maintain the outlet. This monthly fee generally will be quite low. Operators may also charge you the actual cost of installing additional outlets in your home. This charge is designed to recover, for example, the labor costs for installing the second outlet. The installation charge may be a one-time payment or it may be spread out over a number of months. If you terminate your cable service, the operator must allow you to purchase the additional outlet wiring, as well as any other home wiring the system installed, at the actual cost of the wiring in your home. If a subscriber requests or installs additional outlets that exceed network design capabilities and that require additional customer premises equipment to receive a good quality signal, the operator may recover the costs of the additional equipment. Q: The channel line-up on my cable system has changed, some stations are on different channel numbers, some stations have been dropped and some stations have been added. The cable company says that the changes are due to FCC regulations. What are these regulations? A: The 1992 Cable Act created new rights for television broadcast stations and new responsibilities for cable operators. As a result, the new FCC regulations require a cable operator to get permission from the broadcast station to put the station on cable. A local broadcast station may give permission by choosing mandatory carriage (must-carry) on the cable system, or by negotiating an agreement for carriage of its signal by the cable company (retransmission consent). A broadcast station which chooses retransmission consent may request some form of payment for the use of its broadcast signal on the cable system, and must negotiate for both its carriage on that system and its channel position. A broadcast station choosing must-carry can generally select (from a set of limited options) its channel position. A cable operator must set aside up to a maximum of one-third of its channel capacity for local commercial television stations. A cable operator is not required to carry stations that show mostly the same programming. Therefore, many stations which were not carried previously suddenly may have become eligible for carriage on your cable system, and many stations which had previously been carried may no longer be available. If a particular station was dropped by your cable system, it may be due to one of the following reasons: the station did not deliver a good quality signal; the station and cable operator failed to reach agreement on a payment to the station to permit the cable company to carry the station; the cable system may have chosen not to pay copyright royalties for the station; or the station was dropped to provide room for other services which the cable operator decided to offer. If you are dissatisfied with the channels being provided by your cable system, you should contact the cable company. Q: I used to receive FM radio stations over my cable system but now I cannot. Why? A: The new law requires cable operators to receive permission to carry all broadcast stations. The law does not limit this provision to TV stations. The new FCC rules require cable operators to negotiate the same type of retransmission consent agreements with radio stations (AM or FM) that they are required to have with TV stations. Many cable operators have not yet secured such permission. The FCC, however, is currently considering rule changes to make it easier for cable operators to get such permission from radio stations. Q: Sometimes the television screen is black with a message that the program has been "blacked out" because of FCC rules. What are these rules? A: A broadcast network (such as ABC, CBS, or NBC) may prohibit a cable operator from carrying more than one network signal if the network affiliate nearest to that cable system has exclusive program rights. If the cable operator carries a second network affiliate, the network may require the cable operator to "black out" network programming from the second affiliate. In addition, some television stations purchase exclusive rights to their syndicated programs within a specific market. These programs then may not be aired by anyone else in that market and therefore, such programs may be blacked out from other stations on the cable system. Q: How can I obtain copies of the FCC's cable regulations? A: Due to budgetary considerations, the FCC does not supply free copies of its regulations. FCC decisions are published in the FCC Record, which is available in some large public libraries and legal libraries, including law school libraries. Summaries of decisions are published in the Federal Register, which is available in many public libraries. You can purchase copies of the FCC's decisions and regulations by calling International Transcription Service at (202) 857-3800. When you call ITS, ask for cable regulations and specify whether you want information regarding rates or other areas. If you wish to purchase copies of the new Cable Act, the entire Communications Act, or FCC rules and regulations, call the Government Printing Office at (202) 783-3238. This material is also available for review in many public libraries.