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("RCN"), an affiliate of a local exchange carrier ("LEC")\@Y yO 'ԍThe Communications Act defines the term "local exchange carrier" as:    XX` ` any person that is engaged in the provision of telephone exchange service or exchange   5 access. Such term does not include a person insofar as such person is engaged in the   \ provision of a commercial mobile service under Section 332(c), except to the extent that the Commission finds that such service should be included in the definition of such term. ` Communications Act  3(26), 47 U.S.C.  153(26).\ that is offering cable service in the Cities. No oppositions to MediaOne's petition were filed.  SQ'  S)'  k2.` ` Section 623(a)(4) of the Communications Act of 1934, as amended ("Communications  |$Act") allows franchising authorities to become certified to regulate basic cable service rates of cable  S' |$operators which are not subject to effective competition.dY yOI 'ԍCommunications Act  623(a)(4), 47 U.S.C.  543(a)(4).d For purposes of the initial request for  |$certification, local franchising authorities may rely on a presumption that cable operators within their  S' |$jurisdiction are not subject to effective competition unless they have actual knowledge to the contrary.P` Y yO#'ԍ47 C.F.R.  76.906, 76.910(b)(4).P  Sa' |$Certification becomes effective 30 days from the date of filing unless the Commission finds that the  S9' |$^authority does not meet the statutory certification requirements.9 Y {O&'ԍ47 C.F.R.  76.910(e); 47 C.F.R.  76.910(b); see also Communications Act  623(a)(4), 47 U.S.C.  543(a)(4). In Implementation of Cable Act Reform"9 ,**88"  S' |$Provisions of the Telecommunications Act of 1996 ("Cable Reform Final Order"),R {Oh' |$ ԍImplementation of the Cable Act Reform Provisions of the Telecommunications Act of 1996, CS Docket No. 9685, FCC 9957 (rel. March 29, 1999) (1999 WL 169592) ("Cable Reform Final Order"). the Commission  |$Vinstructed cable operators  'r believing themselves subject to LEC effective competition under Section  |$623(l)(1)(D) of the Communications Act to file a petition for determination of effective competition  S' |$pursuant to Section 76.7 and 76.907 of the Commission's rules.K"R yOL'ԍ47 C.F.R.  76.7 and 76.907.K Section 623(l)(1)(D) of the Communications Act provides that a cable operator is subject to effective competition where:   XX` ` a local exchange carrier or its affiliate (or any multichannel video programming   distributor using the facilities of such carrier or its affiliate) offers video   iprogramming services directly to subscribers by any means (other than directto  home satellite services) in the franchise area of an unaffiliated cable operator   which is providing cable service in that franchise area, but only if the video   programming services so offered in that area are comparable to the video  S" 'programming services provided by the unaffiliated cable operator in that area.j" R yOt'ԍCommunications Act  623(l)(1)(D), 47 U.S.C.  543(l)(1)(D).j `  S ' II.THE PLEADINGS  S '  k3.` ` MediaOne argues that it faces LEC effective competition in its Arlington and Newton,  |$*Massachusetts franchise areas from RCN, a LECaffiliated franchised cable operator. With regard to the  |$@LEC affiliation requirement, MediaOne contends that RCN currently markets both telephone and cable  S ' |$television service to Arlington and Newton residents.? BR yO'ԍMediaOne Petition at 2.? MediaOne explains that RCN is a joint venture  |$between RCN Telecom Services, Inc. ("RCNTS") and Boston Edison Company. MediaOne states that  S' |$&RCNTS is a whollyowned subsidiary of CTEC, "R yO,' |$ ԍCTEC is a holding company with wholly and majorityowned subsidiaries engaged in the provision of  |$ competitive local exchange services and cable television. CTEC operates as a local exchange carrier in  {O' |$H Pennsylvania, offering service to a 19county, 5067 square mile service territory in the state. See CTEC Corporation SEC Form 10K, filed with the Securities and Exchange Commission on March 31, 1997. a local exchange carrier, and that RCNTS, itself, is  S' |$engaged in the provision of local exchange service.Q Z R yO' |$ ԍMediaOne notes that CTEC's SEC Form 10K states that RCNTS is a provider of "local and long distance  |$^ telephone service, video programming and internet access to households located in New York City and Boston."  {O~!'See MediaOne Petition at 5.Q MediaOne additionally asserts that RCN is affiliated  Sj'with MFS Communications Company, Inc. ("MFS"), another local exchange carrier.? jR yO#'ԍMediaOne Petition at 6.?  S'  k4.` ` With regard to the requirement that the LEC competitor offer video programming service  |$in the unaffiliated cable operator's franchise area, MediaOne asserts that RCN is physically able to deliver"n ,p(p(88"  S' |$service to potential subscribers in Arlington and Newton.1 R {Oh'ԍId.1 MediaOne states that on February 27, 1997,  |$*the Commission granted RCN's application for OVS certification covering 48 service areas in and around  S' |$gBoston, Massachusetts, including Arlington and Newton. ZR {O'ԍId. at 7 citing RCNBETG, L.L.C., Memorandum Opinion and Order, 12 FCC Rcd 2480 (1997). According to MediaOne, RCN entered into  |$"individual OVS agreements with the Cities of Arlington and Newton in August and October, 1997,  S`' |$respectively.}`R {O'ԍId. Copies of the agreements are attached to MediaOne's Petition at Exhibit B.} MediaOne states that these OVS agreements require RCN to make service available to  |$every residential dwelling and business in the Cities of Arlington and Newton, and to complete  |$construction of the OVS system within 10 months of the date of the agreements (specifically, June 25,  S' |$1998 in Arlington and August 22, 1998 in Newton.)1~R {O 'ԍId.1 MediaOne adds that RCN has been competing for  |$ cable television customers in Arlington since November, 1998 and began selling service to Newton in  S' |$February, 1999.7R {OH'ԍId. at 8.7 MediaOne asserts that there are no regulatory, technical, or other impediments to  |$households taking RCN's service and that RCN has launched an "aggressive" $10 million mass media  |$Qadvertising campaign (radio, newspaper, and direct mail) to create awareness of its voice, data, and video  S 'offerings.8 R {Ob'ԍId. at 10.8  S '  k5.` ` MediaOne also asserts that RCN offers programming comparable to that offered by  S ' |$MediaOne in Arlington and Newton.1 4 R {O|'ԍId.1 MediaOne provides RCN's channel lineups which demonstrates  |$that RCN offers 100 channels of video programming, several of which are local television broadcast  SX' |$Vsignals.>X R {O'ԍId. at 12.> MediaOne also includes its own channel lineups which indicate that it offers almost 100  S0'channels of video programming in Arlington and Newton.E0X R {O('ԍId. at Exhibit F.E  S'  k6.` ` MediaOne states that RCN's OVS agreements require RCN to provide performance bonds  |$gto the Cities ($350,000 in Newton and $250,000 in Arlington) and that RCN is also required to provide  S' |$two PEG access channels.7R {O#'ԍId. at 9.7 Furthermore, RCN must pay to the Cities a percentage of its gross annual  |$/revenues from the provision of OVS services. According to MediaOne, RCN is clearly making an  |$investment in its OVS operations throughout Arlington and Newton of the type the Commission believes  S'is characteristic of an effective competitor.2|R {O4''ԍId. 2",p(p(88"Ԍ S'ԙ III.ANALYSIS  S'  kq7.` ` In the absence of a demonstration to the contrary, cable systems are presumed not to be  S' |$subject to effective competition.>R yO'ԍ47 C.F.R.  76.906.> The cable operator bears the burden of rebutting the presumption that  |$effective competition does not exist with evidence that effective competition, as defined by Section 76.905  S8'of the Commission's rules, is present within the franchise area.'8XR yO0' |$ ԍ47 C.F.R.  76.905 and  76.907. The note to Section 76.907 states that the criteria for determining effective  {O'competition pursuant to Section 76.905(b)(4) are described in the Cable Reform Final Order. ' MediaOne has met this burden.  S'  k8.` ` With regard to the first part of the LEC effective competition test, which requires that the  |$7alleged competitive service be provided by a LEC or its affiliate (or any multichannel video programming  |$distributor using the facilities of such LEC or its affiliate), we find that MediaOne has provided sufficient  |$^evidence, through SEC documents and other material, demonstrating that RCN is LECaffiliated under the  SH ' |$Commission's rules.DH R yO'ԍ47 C.F.R. 76.905(b)(4).D Therefore, we find that MediaOne satisfies the affiliation prong of the LEC  |$effective competition test. In addition, we note that MediaOne is unaffiliated with RCN or any of RCN's partners.  S '  k9.` ` We also find that MediaOne has submitted sufficient evidence showing that RCN's  |$program service offering is comparable to MediaOne's channel lineups in Arlington and Newton. Under  |$the Commission's rules, in order to offer comparable programming as that term is used, a competing  |$cmultichannel video programming distributor must offer at least 12 channels of video programming,  S' |$including at least one channel of nonbroadcast service programming.ABR yO'ԍ47 C.F.R. 76.905(g).A The channel information for RCN  |$&submitted by MediaOne establishes that RCN offers 100 channels of programming, including 15 local  |$broadcast channels and numerous nonbroadcast channels, in satisfaction of the programming comparability criterion.  S@'  k 10.` ` The LEC effective competition test requires that competitive service be offered directly  |$to subscribers in the franchise area of an unaffiliated cable operator which is providing cable service in  |$Ethat franchise area. In enacting the LEC effective competition test, Congress indicated that the  |$tCommission should apply its preexisting definition of the term "offer" to the LEC effective competition  S'test.R {O!' |$ ԍCable Reform Final Order, at  7, citing H.R. Rep. No. 458, 104th Cong., 2d Sess. 170 (1996) ("Conference Report"). This definition provides that service is offered:  Gxm 'd Ԋ 'd X(1) When the multichannel video programming distributor is physically able to deliver  Gx\service to potential subscribers, with the addition of no or only minimal additional  Gxinvestment by the distributor, in order for an individual subscriber to receive service; and  Gx (2) When no regulatory, technical or other impediments to households taking service exist,", ,p(p(88"  Gxvand potential subscribers in the franchise area are reasonably aware that they may  S'purchase the services of the multichannel video programming distributor.o( {O@'ԍ47 C.F.R. 76.905(e); see Cable Reform Final Order, at  7.o   S'  k\11.` ` We conclude that, based on the information before us, RCN is offering service in  |$Arlington and Newton sufficient to demonstrate the presence of effective competition. In order to support  |$@a finding of effective competition under the LEC test, the LEC's service must substantially overlap the  S' |$incumbent cable operator's service in the franchise area.VZ( {O 'ԍSee Cable Reform Final Order at  10.V RCN has constructed its video distribution  |$facilities throughout Arlington and Newton and is actively signing up and serving customers. We further  |$find it relevant that RCN's posting of performance bonds, establishment of PEG channels, and payment  |$of a percentage fee of gross revenues, demonstrates RCN's commitment to provide video programming  Sp'service to Arlington and Newton residents now and in the future.p( {O ' |$* ԍSee Cable Reform Final Order at  13 ("If the LEC plans an open video system, the showing must establish the LEC's intent regarding the proposed area.")  S '  k12.` ` We note that RCN's extensive marketing efforts throughout the Cities and the wide press  |$coverage of RCN's construction activities in the local media ensure that potential subscribers are  |$Mreasonably aware of the availability of RCN's service. In addition, we find that subscribers are able to  |$Dreceive RCN's cable service for only a minimal additional investment and without encountering regulatory or technical obstacles.  S0'  kz13.` ` We find that MediaOne has submitted sufficient evidence demonstrating that its cable  |$systems serving Arlington and Newton, Massachusetts are subject to LEC effective competition from RCN.  |$ MediaOne's petition is hereby granted and the certifications of the Cities of Arlington and Newton are revoked.  Sh' IV.ORDERING CLAUSES  S@'  S'  k\14.` ` Accordingly, IT IS ORDERED that the Petition for Determination of Effective  |$}Competition filed by MediaOne challenging the certifications of the Cities of Arlington and Newton,  S'Massachusetts IS GRANTED.  " F,p(p(88"Ԍ S'  kzԙ15.` ` IT IS FURTHER ORDERED that the certifications of the Cities of Arlington and  |$yNewton, Massachusetts to regulate the basic cable rates of MediaOne in Arlington and Newton,  S'Massachusetts IS REVOKED .  S`'  k16.` ` This action is taken pursuant to delegated authority under Section 0.321 of the  S8'Commission's rules, as amended.<8( yO'ԍ47 C.F.R  0.321.< ` `  Ghh}FEDERAL COMMUNICATIONS COMMISSION ` `  Ghh}William H. Johnson ` `  Ghh}Deputy Chief, Cable Services Bureau      Xh4 #Xj\  P6G;XP#