Report No. IN 98-7                    INTERNATIONAL ACTION                February 19, 1998


   COMMISSION PROPOSES CONSOLIDATION AND SIMPLIFICATION OF DBS
SERVICE RULES, UPDATE OF DBS TECHNICAL RULES AND SEEKS COMMENT ON DBS OWNERSHIP LIMITATIONS
                        (IB DOCKET 98-21)


     In order to facilitate the licensing of advanced satellite services and to promote
competition in the multichannnel video programming delivery (MVPD) market, the
Commission has proposed streamlining and consolidating its service rules governing the Direct
Broadcast Satellite (DBS) service.  The Commission's proposals are consistent with its goal of
regulating services in a common-sense manner that reduces regulatory burdens and facilitates
the delivery of new services to consumers.  To these ends, the Commission proposes
consolidating the DBS service rules, currently located in Part 100, with the rules for the other
satellite services, including the Direct-to-Home Fixed-Satellite Service (DTH-FSS) in Part 25.  
The Commission also proposed updating the technical rules for the DBS service and requested
comment on additional actions it could undertake to speed the delivery of DBS service to the
states of Alaska and Hawaii as well as to non-continental United States territories and
possessions.

     The Commission is committed to eliminating unnecessary and duplicative regulation of
the emerging DBS service and to providing greater consistency in the regulatory regime for all
satellite services.  Today DBS and DTH-FSS provide multichannel video programming
services to about 8 million households.  It has been reported that domestic and international
demand for DBS service and DTH-FSS is expected to grow substantially in the future,
providing increased competition to the cable industry and in the MVPD market generally.  The
Commission indicated a desire to continue to examine its policies to ensure they are pro-
competitive and deregulatory, citing consumer benefits that derive from competition such as
more service offerings, better customer service, and downward pressure on prices. 

     As part of the incorporation of the DBS rules into Part 25, the Commission seeks 
comment on the application of the foreign ownership limitations of Section 310(b) of the
Communications Act and Section 100.11 of the Commission's rules to subscription DBS and
DTH-FSS service providers.  


                              (over)
                                 
                              - 2 -

     With respect to improving the delivery of service to Alaska and Hawaii, the
Commission proposes to maintain the rule requiring all DBS licensees granted authorizations
after January 19, 1996 to provide service to Alaska and Hawaii, where technically feasible. 
The Commission sought comment on a proposal by the State of Hawaii that would require
licensees of DBS channels at eastern orbital positions to demonstrate that they have provided
service to the states of Alaska and Hawaii before they would be eligible to provide service
from any eastern DBS channel assignments beyond their existing assignments.  The
Commission also sought comment on ways to speed the delivery of DBS service to non-
continental United States territories and possessions. 

     Finally, the Commission requested comment on issues related to horizontal
concentration in the MVPD market.  Comment was sought as to whether any limitations on
cable/DBS cross-ownership are warranted, and if so, whether they should be addressed on a
case-by-case basis or by a rule of general application.

     Action by the Commission February 19, 1998, by Notice of Proposed Rulemaking
(FCC 98-26).  Chairman Kennard, Commissioners Ness and Tristani, with Commissioners
Furchtgott-Roth and Powell dissenting in part and issuing statements.

                             - FCC -

     News Media contacts: Rosemary Kimball and Maureen Peratino at (202) 418-0500.
          International Bureau contacts: Peter Pappas at (212) 418-0746, Chris Murphy at (202)
     418-2372, Tom Boasberg at (202) 418-2169 or Doug Webbink at (202) 418-1494.
     TTY: (202) 418-2555