******************************************************** NOTICE ******************************************************** This document was converted from WordPerfect to ASCII Text format. Content from the original version of the document such as headers, footers, footnotes, endnotes, graphics, and page numbers will not show up in this text version. All text attributes such as bold, italic, underlining, etc. from the original document will not show up in this text version. Features of the original document layout such as columns, tables, line and letter spacing, pagination, and margins will not be preserved in the text version. If you need the complete document, download the WordPerfect version or Adobe Acrobat version, if available. ***************************************************************** Before the Federal Communications Commission Washington, D.C. 20554 D P Media of Martinsburg, Inc. ) ) CSR-5086-A Television Station WSHE(TV) ) ) ) For Modification of the ) Hagerstown ADI ) MEMORANDUM OPINION AND ORDER Adopted: January 22, 1998 Released: February 4, 1998 By the Deputy Chief, Cable Services Bureau: I. INTRODUCTION 1. DP Media of Martinsburg, Inc., has filed with the Commission, pursuant to Sections 76.7(a)(1) and 76.59(a) of the Commission's rules, a petition requesting modification of the television market of television station WSHE(TV), Channel 60, Martinsburg, West Virginia, ("WSHE") for purposes of the cable television mandatory broadcast signal carriage rules. WSHE seeks to add the communities located in the following counties to its television market: Allegheny, Carroll, Frederick, and Montgomery, Maryland; Adams, Bedford, Franklin, Fulton, and Huntingdon, Pennsylvania; Clarke, Fauquier, Frederick, Loudoun, Rappahannock, Shenandoah, Warren, and Winchester, Virginia; and Hampshire, Hardy, Jefferson, and Morgan, West Virginia (collectively, the "Communities"). Frederick Cablevision, Inc., C/R TV Cable TV Cable, Inc., and GS Communications, Inc. ("Frederick"), Benchmark Acquisition Fund I, L.P. d/b/a Cablevision of Loudoun ("Benchmark"), SBC Media Ventures, L.P. ("SBC"), and Prestige Cable TV, Inc. ("Prestige") filed a joint opposition (collectively the "Operators I") and TCI of Pennsylvania, Inc. ("TCI-P") and TCI of West Virginia, Inc. ("TCI-WV") filed a separate joint opposition (collectively "Operators II") to which WSHE filed a consolidated reply. II. BACKGROUND 2. Pursuant to Section 614 of the Communications Act of 1934, as amended by the Television Consumer Protection and Competition Act of 1992 ("1992 Cable Act"), and implementing rules adopted by the Commission in its Report and Order in MM Docket 92-259, commercial television broadcast stations are entitled to assert mandatory carriage rights on cable systems located within the station's market. A station's market for this purpose is its "area of dominant influence" or ADI as defined by the Arbitron audience research organization. An ADI is a geographic market designation that defines each television market exclusive of others, based on measured viewing patterns. Essentially, each county in the United States is allocated to a market based on which home-market stations receive a preponderance of total viewing hours in the county. For purposes of this calculation, both over-the-air and cable television viewing are included. 3. The Commission is also directed to consider changes in market areas. Section 614(h)(1)(C) further provides that the Commission may: with respect to a particular television broadcast station, include additional communities within its television market or exclude communities from such station's television market to better effectuate the purposes of this section. In considering such requests, Section 614(h)(1)(C)(ii) provides that: the Commission shall afford particular attention to the value of localism by taking into account such factors as -- (I) whether the station, or other stations located in the same area, have been historically carried on the cable system or systems within such community; (II) whether the television station provides coverage or other local service to such community; (III) whether any other television station that is eligible to be carried by a cable system in such community in fulfillment of the requirements of this section provides news coverage of issues of concern to such community or provides carriage or coverage of sporting and other events of interest to the community; and (IV) evidence of viewing patterns in cable and non-cable households within the areas served by the cable system or systems in such community. 4. The legislative history of this provision indicates that: where the presumption in favor of ADI carriage would result in cable subscribers losing access to local stations because they are outside the ADI in which a local cable system operates, the FCC may make an adjustment to include or exclude particular communities from a television station's market consistent with Congress' objective to ensure that television stations be carried in the areas which they serve and which form their economic market. * * * * * [This subsection] establishes certain criteria which the Commission shall consider in acting on requests to modify the geographic area in which stations have signal carriage rights. These factors are not intended to be exclusive, but may be used to demonstrate that a community is part of a particular station's market. 5. The Commission provided guidance in its Report and Order in MM Docket 92-259, supra, to aid decision making in these matters, as follows: For example, the historical carriage of the station could be illustrated by the submission of documents listing the cable system's channel line-up (e.g., rate cards) for a period of years. To show that the station provides coverage or other local service to the cable community (factor 2), parties may demonstrate that the station places at least a Grade B coverage contour over the cable community or is located close to the community in terms of mileage. Coverage of news or other programming of interest to the community could be demonstrated by program logs or other descriptions of local program offerings. The final factor concerns viewing patterns in the cable community in cable and non-cable homes. Audience data clearly provide appropriate evidence about this factor. In this regard, we note that surveys such as those used to demonstrate significantly viewed status could be useful. However, since this factor requires us to evaluate viewing on a community basis for cable and non-cable homes, and significantly viewed surveys typically measure viewing only in non-cable households, such surveys may need to be supplemented with additional data concerning viewing in cable homes. III. MARKET FACTS AND ARGUMENT 6. WSHE is assigned to the Hagerstown, Maryland ADI. WSHE's city of license, Martinsburg, West Virginia and transmitter are located in Berkeley County, West Virginia which is part of the Washington, D.C. ADI. The 119 cable communities which WSHE seeks to add to its television market are located in five different ADIs. The cable communities located in Adams County, Pennsylvania are part of the Harrisburg-York-Lancaster-Lebanon ADI, the communities in the counties of Bedford, Fulton, and Huntingdon, Pennsylvania are part of the Johnstown-Altoona ADI, the communities in Hardy County, West Virginia are part of the Harrisburg, Virginia ADI, the communities located in Carroll County, Maryland are located in the Baltimore ADI, the remaining communities are located in the Washington, D.C. ADI. WSHE places either a City Grade or a Grade B contour over all of the cable communities at issue. 7. In support of its petition, WSHE states that Congress intended the market modification procedures to prevent communities from losing access to broadcast television stations which provide local service but which may not be assigned to the particular ADI in which those communities are located. With regard to the first statutory factor for market modification, WSHE states it began broadcasting on August 1, 1996, therefore, its lack of historical carriage should be given little, if any, weight in this proceeding. 8. With regard to local service, WSHE asserts that the station places a City Grade signal over a significant number of the Communities and places a Grade B contour over the remaining cable communities at issue. WSHE points out that the Cable Services Bureau ("Bureau") has found persuasive evidence indicating that a television station places a Grade B or better contour over the relevant cable communities. With regard to programming service, WSHE states that it is a specialty station airing a unique format combining program-length presentations by local and national businesses and community organizations and local public affairs, children's, and religious programming. WSHE states that it airs a weekly public affairs program "Our Back Yard" which highlights local organizations and issues of importance to residents of the Communities. WSHE states that the Bureau has found that a programming format such as WSHE's "is not incompatible with local appeal." 9. With regard to statutory factor three, WSHE states that the availability of other stations eligible to be carried on cable systems serving the cable communities does not act as a bar to a broadcast station's request to add communities to its own television market. WSHE further states that this criterion acts only as an enhancement factor where it can be shown that other stations do not provide local service. 10. With regard to viewership levels, WSHE states that it does not subscribe to a ratings service because of its specialized programming format. WSHE further states that because it is a new station, it has not had an opportunity to build an audience. 11. WSHE asserts that the Bureau should take into consideration other relevant factors such as recent decisions concerning stations assigned to the Hagerstown ADI and the scope of their economic market. In Great Trails Broadcasting Corp., the Bureau added communities located in the Counties of Hampshire, Jefferson, and Morgan, West Virginia; Allegheny and Frederick, Maryland; Franklin and Fulton, Pennsylvania; and Frederick, Virginia to the television market of broadcast station WHAG-TV. WHAG-TV is licensed to the same city as WSHE, namely, Hagerstown, Maryland. WSHE further states that in Good Companion Broadcasting, Inc., the Bureau modified the television market of WJAL, a broadcast station whose city of license is also Hagerstown, to add the communities located in the same counties as in Great Trails as well as communities located in the Counties of Adams and Cumberland, Pennsylvania and in Clarke, Virginia. WSHE asserts that it is a direct competitor of both broadcast stations WHAG-TV and WJAL and that each of the three stations provide similar local service. WSHE maintains that the only difference between itself and WHAG-TV and WJAL is that those stations are network affiliates while WSHE is an independent station with a specialized programming format. 12. In opposition, the Cable Operators argue that WSHE fails to demonstrate that it adequately meets the statutory requirements for market modifications. The Cable Operators distinguish the Bureau's prior decisions in Great Trails and in Good Companion noting that, in those cases, the television stations at issue had demonstrated a long history of carriage and had significant ratings in the relevant cable communities. In the instant case, the Cable Operators state that WSHE has never been carried by cable systems serving the Communities despite the fact that the station, operating as broadcast station WYVN, has been in operation since 1991 except for a two-year absence. The Cable Operators further state that WSHE fails to demonstrate that it has garnered an audience within either cable or non- cable households located in the cable communities at issue. The Cable Operators state that they have been unable to find a demonstrable audience for WSHE in the Communities or evidence of ratings in certain of those communities. 13. Operators II allege that WSHE, contrary to its claim, does not provide a good quality signal to several cable communities at issue and Operators I dispute WSHE's claim that it places a Grade B contour coverage over all of the Communities. Operators II assert that neither WSHE's Grade B contour map on file with the Commission nor WSHE's contour map published in Television & Cable Factbook comports with the Grade B contour map submitted by WSHE in this proceeding. According to their maps, the Operators II assert that WSHE's Grade B contour does not cover many of the Communities including the communities of: Barnesville, Boyds, or Poolesville, Maryland served by SBC cable system; Leesburg and Middleburg, Virginia served by Benchmark cable system; Frederick, Discovery, Emmitsburg, Mount Airy, New Market, Walkersville and Woodsboro, located in Frederick County, Maryland and served by Frederick cable system; Butler Township, Cumberland Township, Fairfield Township, Freedom Township, Germany Township, Gettysburg, Highland Township, Menallen Township, and Mount Joy Township located in Adams County, Pennsylvania and also served by Frederick cable system; and Marshall, Virginia, Mount Airy, Taneytown and Union Bridge, Maryland served by Prestige cable system. 14. The Cable Operators state that WSHE fails to provide local programming targeted to the needs of the subscribers in the Communities. The Cable Operators further state that the program-length presentations aired by WSHE have no specific nexus to cable communities at issue. Instead, they say WSHE uses the same infomercial format as do all television stations owned by Paxson Communications Corporation. The Cable Operators contend that the program cited by WSHE, "Our Backyard" does not target the specific cable communities at issue and, even if it did, it would be inadequate to satisfy the local service criterion for market modification. The Cable Operators assert that it is undisputed that they carry numerous local broadcast stations which provide local coverage to the Communities. As a result, the Cable Operators argue that WSHE is not entitled to any benefit as an enhancement criterion for providing a service that other local stations do not provide. 15. In reply, WSHE asserts that the station provides Grade B contour coverage to all of the Communities and that it is a direct competitor of television stations WJAL and WHAG(TV) which, in Great Trails and in Good Companion respectively, were granted the same relief requested by WSHE. WSHE argues that those prior Commission decisions create strong precedent in this case and demonstrate that all three stations are located in the same economic market. WSHE maintains that the Cable Operators, in disputing WSHE's claim of Grade B coverage, relied on a Grade B contour map that indicates the previous licensee's mode of operation. WSHE states that when the station was acquired from the previous licensee, it completed construction of the facilities as authorized by the Commission license and,as a result, WSHE provides full Grade B coverage to the Communities. With regard to historic carriage and viewership, WSHE states that it should be viewed as a new station since it only began broadcasting as television station WSHE on August 1, 1996. IV. DISCUSSION 16. We will grant, in part, and deny, in part WSHE's petition to modify its television market. We find that WSHE fails to satisfy any of the statutory criteria for including cable communities in Carroll and Montgomery Counties within the Hagerstown ADI. With regard to the remaining cable communities, we find that the evidence evaluated pursuant to the four statutory factors and other relevant factors persuades us that those communities are properly considered part of WSHE's television market. 17. In this case, while we evaluate each modification petition on an individual basis, we have taken into consideration the Bureau's previous decisions in Great Trails and in Good Companion. Those two cases indicate our belief that many of the cable communities at issue in this case and the Hagerstown ADI form a single economic market. In Great Trails, we found that, among others, the communities at issue here in the Counties of Allegheny and Frederick, Maryland; Franklin and Fulton, Pennsylvania; Frederick, Virginia; and Hampshire, Jefferson, and Morgan, West Virginia were part of the Hagerstown ADI. In Good Companion, we relied upon the earlier Great Trails decision and we found that, in addition to the communities added to the Hagerstown ADI by Great Trails, the communities located in the Counties of Adams and Cumberland, Pennsylvania and in Clark, Virginia were also part of the Hagerstown ADI. We further found that the communities in the Counties of Allegheny, Morgan, and Hampshire and that the communities of Berryville and Boyce in Clarke County, Virginia and the community of Winchester in Frederick County, Virginia are geographically closer to Hagerstown than they are to Washington, D.C., the ADI to which they were assigned or which formed the center of the ADI to which they were assigned. With regard to the communities in Allegheny County, we further found that many of the communities at issue are located along or near a commercial artery, I-70- Maryland-40, which runs East-West and connects Allegheny County to the Hagerstown area. 18. We find additional support for adding the cable communities noted above to WSHE's television market in statutory factor one, historic carriage. The historic carriage factor encompasses other stations located in the same area which have been historically carried on the cable system or cable systems serving the relevant communities. Such carriage provides evidence of the scope of the market because it demonstrates the belief of both the television stations and the cable systems involved that there is a market nexus between each station and the communities where the station is carried. In this case, as noted above, broadcast stations WJAL and WHAG-TV, both of which are licensed to the same city as WSHE, have a history of carriage in certain of the cable communities here at issue. The purposes of the must-carry statute are better effectuated where television stations which are competitively situated are treated similarly with respect to their television markets. We thus find that factor one weighs in favor of the requested action in those cable communities. 19. WSHE seeks to add, in addition to those communities listed above which we previously included in the Hagerstown ADI, communities located in the Counties of Carroll and Montgomery, Maryland; Bedford and Huntingdon, Pennsylvania; Fauquier, Loudoun, Rappahannock, Shenandoah, and Warren, Virginia; and Hardy, West Virginia. We find that WSHE lacks historic carriage as well as a measurable audience (statutory factors one and four) in these cable communities. The absence of historic carriage weighs against the requested action but it is not by itself a controlling factor. To give decisional weight to the lack of historic carriage would prevent newer or weaker stations from ever being entitled to carriage, a result that is contrary to the goals embodied in the must-carry statute. Similarly, with regard to statutory factor four, audience viewership, we have found that ratings should not be controlling particularly where a television station is new and airs a specialized programming format. WSHE, which began broadcasting in August 1996, has not had the opportunity to build an audience and thus lacks a measurable audience (cable and non-cable). Indeed, stations can take up to three years to establish their viewing patterns. Congress could not have intended for such stations to have cable communities excluded from their market solely because their audience shares are not as significant as those of several other stations with which they compete. If this were the case, the 1992 Cable Act would have designated a ratings mechanism, rather than ADIs, as the primary determinant for broadcast signal carriage. Moreover, WSHE is a specialty station which airs home-shopping programs. Home shopping stations typically attract a limited audience but can provide a diverse and valuable service to subscribers. 20. Local service, statutory factor two, incorporates both technical service and programming service. With respect to technical service, the Commission has stated in its Report and Order in MM Docket 92-259 that "to show that the station provides coverage or other local service to the cable communities, parties may demonstrate that the station places at least a Grade B coverage contour over the cable community or is located close to the community in terms of mileage." We focus here more heavily on basic geographic and technical service as evidenced by WSHE's Grade B contour to provide evidence of the market boundaries of the television station. The evidence submitted with regard to the second statutory factor demonstrates that WSHE provides technical service to the Communities with the exception of those in Carroll and Montgomery Counties. WSHE does not cover cable communities in Carroll and Montgomery Counties with a Grade B contour nor can it be said that those communities lie with WSHE's predicted Grade B contour fringe. The remaining cable communities are covered by WSHE's predicted Grade B contour or are within WSHE's Grade B contour fringe. 21. With regard to the third statutory factor, whether other stations eligible to be carried serve the relevant cable communities, we do not believe that Congress intended this third criterion to operate as a bar to a station's ADI claim whenever it could be shown that other stations do not serve the communities at issue. Thus when we consider the totality of facts and circumstances, we are persuaded that WSHE's television market should be modified to add certain of the cable communities here in question. 22. We have carefully considered each statutory and other relevant factors in the context of the circumstances presented here. We are under no obligation to give particular weight to any one of the several factors under consideration. However, given the difficulties of relying exclusively on the statutory factors which could severely narrow the carriage rights of stations even within what is undeniably their local market area, we have found it necessary to focus more heavily on factors that are not influenced by the type or age of the stations involved. We have also taken into consideration our previous modification decisions pertaining to the Hagerstown ADI. We find that WSHE's Grade B contour coverage coupled with the historic carriage of similarly situated stations demonstrate WSHE's market nexus to the Communities. V. ORDERING CLAUSES 23. ACCORDINGLY, IT IS ORDERED, pursuant to 614(h) of the Communications Act of 1934, as amended, 47 U.S.C.  534, and Section 706.59 of the Commission's rules, 47 C.F.R. 76.59, that the petition for special relief (CSR-5086-A) filed by D P Media of Martinsburg, Inc., licensee of WSHE(TV), IS GRANTED with respect to the cable communities at issue located in Counties of Allegheny and Frederick, Maryland; Adams, Bedford, Franklin, Fulton, and Huntingdon, Pennsylvania; Clarke, Fauquier, Frederick, Loudoun, Rappahannock, Shenandoah, Warren, and Winchester, Virginia; and Hampshire, Hardy, Jefferson, and Morgan, West Virginia and IS DENIED with respect to the cable communities in the Counties of Carroll and Montgomery, Maryland. 24. IT IS FURTHER ORDERED that Frederick Cablevision, Inc., C/R TV Cable TV Cable, Inc., and GS Communications, Inc., Benchmark Acquisition Fund I, L.P. d/b/a Cablevision of Loudoun, SBC Media Ventures, L.P., Prestige Cable TV, Inc., TCI of Pennsylvania, Inc. and TCI of West Virginia, Inc. shall commence carriage of WSHE on their respective cable systems serving the Counties of Allegheny and Frederick, Maryland; Adams, Bedford, Franklin, Fulton, and Huntingdon, Pennsylvania; Clarke, Fauquier, Frederick, Loudoun, Rappahannock, Shenandoah, Warren, and Winchester, Virginia; and Hampshire, Hardy, Jefferson, and Morgan, West Virginia. 25. IT IS FURTHER ORDERED that WSHE shall notify the Cable Operators in writing of its carriage and channel position elections pursuant to Sections 76.56, 76.57 and 76.64(f) of the Commission's rules, 47 C.F.R. 76.56, 76.57, and 76.64(f), within thirty (30) days of the release date of this Order. The affected cable systems shall comply with the applicable rules within sixty (60) days of such notification from WSHE. 26. This action is taken pursuant to authority delegated by Section 0.321 of the Commission's rules, 47 C.F.R. 0.321. FEDERAL COMMUNICATIONS COMMISSION William H. Johnson Deputy Chief, Cable Services Bureau