In the Matter of Implementation of the Cable Television Consumer Protection and Competition Act of 1992, Review of the Commission's Cable Attribution Rules, CS Docket No. 98-82.
I respectfully dissent from the adoption of these cable attribution rules. I agree, however, with certain decisions regarding cable reform. I thus dissent in part and concur in part in this Report and Order.
General Attribution Standards
The instant cable attribution rules are based primarily on the newly revised broadcast attribution rules. See supra at para. 11 (incorporating by reference the reasoning set forth in the Broadcast Attribution Report and Order). Those rules are, with a few exceptions, imported into the instant context.
For the reasons that I gave in my dissent from the broadcast attribution rules, I must also dissent from these counting standards. See Statement of Commissioner Harold W. Furchtgott-Roth, Dissenting in Part and Concurring in Part, In the Matter of the Commission's Regulations Governing Attribution of Broadcast and Cable/MDS Interests, MM Docket No. 94-150; Review of the Commission's Regulations and Policies Affecting Investment in the Broadcast Industry, MM Docket No. 92-51; Reexamination of the Commission's Cross-Interest Policy, MM Docket No. 87-154 (rel. Aug. 6, 1999). In short, I believe that we should have taken these opportunities to simplify our attribution rules, instead of creating additional layers of regulation such as the equity-debt-plus test and reaching into heretofore uncharted areas such as pure debt instruments.(1)
With particular respect to the changes in the insulation criteria for partnerships, I am sympathetic to the concerns that motivate the Commission. I would prefer to address policy questions in the substantive rule on the horizontal limit, however, not in the context of the attribution rules. I fear that the "materially involved in programming activities" test will prove too subjective to be efficiently applied and enforced.
I am also troubled by the elimination of the single majority shareholder exception. As I made clear in the Broadcast Attribution Order, this rule provides at least some safe harbor to regulated entities in terms of attribution. Against the backdrop of our vastly complicated attribution rules, this exception -- whether or not I would have created it in the first instance
-- operates to provide at least one clear instance where interests will not be attributable. Unless we intend to start from scratch and come up with a streamlined attribution system, I think we should retain the single majority shareholder exception.
In this regard, I must note, again, a yawning inconsistency between the broadcast item and this one: while we generally adhere to the broadcast attribution framework for cable, the Commission departs from that framework for the single majority shareholder rule in particular. If the policy reasons animating the rule are persuasive in broadcast, then they ought to work equally well here -- especially given that the Commission states that the industries are not so different that different attribution rules are needed, as noted above. I see no rational justification for retaining this exception for broadcasters but repealing it for cable operators, and I do not think the Order provides one.
Cable Reform Issues
I agree with the Commission's definition of the term "affiliate" for purposes of the LEC effective competition provision of section 623(l). See supra at paras. 121-126. In particular, while the Title I definition does not control in this context, I think it wise to exercise our discretion in light of Congress' definition, as the Commission does. I thus join in this decision. I would have used the same test, however, for purposes of both the competing provider provision of section 623(l) and the cable-telco buy-out rule, cf. supra at paras. 127-133, and thus dissent from that decision.