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Federal Communications Commission
Washington, D.C. 20554
In re Complaint Against )
Comcast Corporation )
For Systemic Abuse of Customer )
Service Standards Established )
by the Federal Communications )
Commission Pursuant to Section )
632(b) of the Communications )
Act of 1934, as Amended.
MEMORANDUM OPINION AND ORDER
Adopted: December 22, 2003 Released: January 8,
By the Commission:
1. In this Memorandum Opinion and Order, we dismiss a
complaint filed by WideOpen West Holdings, LLC (``WOW'') against
Comcast Corporation (``Comcast'') alleging that Comcast is
violating the Commission's cable customer service rules1 in the
Detroit, Michigan metropolitan area by failing to provide proper
written notice of certain promotional discounts.2 We do so
because WOW has not demonstrated that Comcast's actions
constitute ``systemic abuses that undermine the statutory
objectives,'' a threshold established by the Commission for
invocation of the Commission's enforcement authority regarding
the cable customer service rules.3
II.A. Statutory and Regulatory Background
2. Section 8 of the 1992 Cable Act (``Section 8'')
provides that ``a franchise authority may establish and enforce''
cable operator ``customer service requirements.''4 It then
requires the Commission to ``establish standards by which cable
operators may fulfill their customer service requirements.''5 It
further states that ``[s]uch standards shall include, at a
minimum, requirements governing - (1) cable system office hours
and telephone availability; (2) installations, outages, and
service calls; and (3) communications between the cable operator
and the subscriber (including standards governing bills and
3. With regard to ``communications between the cable
operator and the subscriber,'' the standards adopted by the
Commission pursuant to this congressional mandate provide, in
[T]he cable operator shall provide written
information on each of the following areas at
the time of installation of service, at least
annually to all subscribers, and at any time
(1) Products and services offered;
(2) Prices and options for programming
services and conditions of subscription to
programming and other services.7
The standards also provide:
Customers will be notified of any changes in
rates . . . as soon as possible in
writing. Notice must be given to subscribers
in a minimum of thirty (30) days in advance
of such changes if the change is within the
control of the cable operator.8
4. Although the 1992 Cable Act directed the Commission to
promulgate customer service standards, it referred only to local
franchising authorities as enforcers of the Commission's customer
service standards.9 The Commission, based on its view of
legislative intent,10 concluded in the Consumer Protection Order
that local franchise authorities, rather than the Commission,
would enforce the customer service rules. 11 Consistent with
that conclusion, the Commission's rules provide that ``[a] cable
franchise authority may enforce the customer service standards''
established in the rules.12 The Consumer Protection Order,
however, articulated a narrow circumstance where the Commission
would retain enforcement authority: ``to address, as necessary,
systemic abuses that undermine the statutory objectives'' of
II.B. Factual Background and Pleadings
5. Comcast is an incumbent cable services provider in many
regions of the United States, including metropolitan Detroit,
Michigan.14 WOW is a competitive cable and broadband services
provider, known as an ``overbuilder,'' serving the metropolitan
Detroit area, among other locations.15 According to WOW, it
competes with Comcast in 42 communities in the Detroit area,16
and WOW's share of the cable services market in the state of
Michigan is approximately 24%.17
6. WOW alleges - and Comcast concedes - that Comcast
offers limited-term discounts in an effort (1) to retain
customers who would otherwise switch to another provider, and (2)
to persuade former customers to return to Comcast.18 WOW further
alleges - and Comcast also concedes - that Comcast does not
publish or publicize all of these retention or win-back discounts
in writing, such as in filings with local franchising authorities
or notices to subscribers.19 According to WOW, these oral,
unpublished ``secret, targeted rates'' may vary ``from day to
day, call to call.''20
7. WOW contends that, by not disclosing in writing to all
its customers every limited-term retention and win-back discount
offer, Comcast is violating the Commission's customer service
rules requiring cable operators (1) to provide written
information to subscribers regarding ``prices and options for
programming services,'' and (2) to notify customers in writing of
``any changes in rates.''21 According to WOW, these oral
discount offers constitute an anticompetitive practice that
treats some Comcast customers unequally and may drive WOW out of
the market.22 WOW requests that the Commission order Comcast to
publish in writing all of its rates and charges, including any
limited-term win-back or retention offers made only to a limited
number of customers, and to pay a forfeiture in the amount of
$27,000.00 for each day that Comcast has failed to comply with
the Commission's regulations.23
8. Comcast argues that the Commission lacks authority to
adjudicate WOW's complaint because the challenged actions do not
constitute ``systemic abuses that undermine the statutory
objectives,''24 which is the standard the Commission established
for the limited scope of its jurisdiction to enforce the cable
customer service rules. Acknowledging this threshold hurdle
previously established by the Commission in this area, WOW claims
that Comcast's practice of failing to disclose in writing to all
subscribers each and every retention or win-back offer meets the
9. WOW's position is that Comcast's failure to disclose in
writing to all of its customers each and every offer made to any
customer for any reason for any period of time undermines the
objectives of Section 8.26 While WOW's complaint implicates the
statutory objectives insofar as it concerns communications
between cable operators and subscribers, based on the broad scope
of the complaint, we are unable to conclude that such a sweeping
proposition in all cases undermines these objectives. By
alleging that Comcast should disclose in writing to all its
customers every limited-term retention and win-back discount
offer made to any subscriber, WOW essentially seeks to preclude
all win-backs and other promotional activities. We are unable to
determine that allegations premised on such a sweeping
proposition conclusively undermine the statutory objectives
concerning communications with subscribers.27 We therefore
conclude that WOW has not demonstrated that Comcast's actions
constitute ``systemic abuses that undermine the statutory
objectives'' in order to invoke our direct enforcement
10. WOW's support for its sweeping proposition relies on a
single, isolated statement in the Senate Report indicating that
the Commission's customer service standards should address, among
other things, ``disclosure of all available service tiers'' and
prices for those tiers.29 WOW's complaint, however, does not
concern written disclosures regarding the kinds of service tiers
offered, but more generally seeks disclosure of all promotional
activity. We find this support a far cry from a mandate that any
limited-term win-back or retention offers ever made be disclosed
or extended uniformly to all subscribers. The pertinent language
of the statute, moreover, does not support this broad
proposition. The relevant statutory language states that the
Commission should establish standards relating to
``communications between the cable operator and the subscriber
(including standards governing bills and refunds).''30 Further,
the relevant legislative history says nothing about requiring
cable operators to communicate in writing to all subscribers
every limited-term retention or win-back offer made to any
subscriber.31 In sum, there is simply no indication in either
the language or legislative history of Section 8 that Congress
meant for the Commission to exercise jurisdiction to enforce
quasi-tariffing regime precluding cable operators from engaging
in the kind of win-back and retention efforts shown by Comcast
here. We do not address here whether some other promotional or
win-back practices could raise systemic issues that undermine
Section 8's statutory objectives.
Rather, we conclude only that Comcast's alleged action in this
case is not a systemic abuse that undermines the statutory
Our conclusion that WOW has not alleged a systemic abuse that
undermines Section 8's customer service objectives does not
preclude WOW from seeking relief from other appropriate sources.
For example, WOW still has at least three avenues of potential
recourse that it could pursue. First, WOW could file complaints
with local franchise authorities under any applicable rules or
ordinances. Second, WOW could file a lawsuit in court alleging
unfair competition/antitrust type claims, which appear to be the
real concern of its complaint here.39 Third, WOW could file a
claim at the Commission under the uniform price provisions of the
Communications Act and the Commission's rules.40
IV. ORDERING CLAUSE
ACCORDINGLY, IT IS ORDERED, pursuant to sections 1, 4(i), 4(j),
601, and 632 of the Communications Act of 1934, as amended, 47
U.S.C. §§ 151, 154(i), 154(j), 521, and 552, and sections 76.6,
76.7, 76.1602, and 76.1603 of the Commission's rules, 47 C.F.R.
§§ 76.6-76.7, and 76.1602-1603, that the Complaint filed by
WideOpen West Holdings, LLC against Comcast Corporation for
systemic abuse of customer service standards established by the
Federal Communications Commission pursuant to Section 632(b) of
the Communications Act of 1934, as amended, IS DISMISSED in its
entirety with prejudice.
FEDERAL COMMUNICATIONS COMMISSION
Marlene H. Dortch
1 47 C.F.R. §§ 76.1602-1603. The Commission promulgated these
rules pursuant to section 632 of the Communications Act of 1934,
47 U.S.C. § 552, as amended by section 8 of the Cable Television
Consumer Protection and Competition Act of 1992, Pub. L. No. 02-
385 § 8, 106 Stat. 1490 (1992) (``1992 Cable Act'' or ``1992
2 In Re Complaint Against Comcast Corporation, File No. EB-02-MD-
033 (filed May 23, 2002) (``Complaint'').
3 Implementation of Section 8 of the Cable Television Consumer
Protection and Competition Act of 1992, Report and Order, 8 FCC
Rcd 2892, 2897 at ¶ 19 (1993) (``Consumer Protection Order''),
pets. for recon. dismissed, Order of Dismissal, 17 FCC Rcd 11916
(Med. Bur. June 24, 2002) (``CPO Dismissal Order).
4 47 U.S.C. § 552(a).
5 47 U.S.C. § 552(b).
7 47 C.F.R. § 76.1602(b). See Consumer Protection Order, 8 FCC
Rcd at 2906-07, ¶¶ 64-68. Rule 76.1602(b) also requires the
provision of written information regarding ``(3) Installation and
service maintenance policies; (4) Instructions on how to use the
cable service; (5) Channel positions . . . ; and (6) Billing
and complaint procedures. . . .'' 47 C.F.R. § 76.1602(b).
8 47 C.F.R. § 76.1603(b). As directed by Congress, the
Commission also adopted customer service rules regarding billing,
see 47 C.F.R. § 76.1619; Consumer Protection Order, 8 FCC Rcd at
29, ¶¶ 65-68; office hours and telephone availability, see 47
C.F.R. § 76.309; Consumer Protection Order, 8 FCC Rcd at 2903-
2904, ¶¶ 45-56; and installations, outages, and service calls,
see 47 C.F.R. § 76.309; Consumer Protection Order, 8 FCC Rcd at
2905-2906, ¶¶ 56-64.
9 47 U.S.C. § 552(a).
10 See Consumer Protection Order, 8 FCC Rcd at 2895, ¶ 10, n.15,
in which the Commission discusses the following portions of the
legislative history: House Comm. on Energy and Commerce, H.R.
Rep. No. 102-628, 102d Cong., 2d Sess. at 37 (1992) (``House
Report''); Statement of Chairman John Dingell, 138 Cong. Rec.
H6500 (daily ed. July 23, 1992); Statement of Chairman Edward
Markey, 138 Cong. Rec. E1034 (daily ed. Apr. 10, 1992). See also
House Report at 78 (Section 8 requires the ``FCC to establish
federal customer service standards which may be required in local
cable franchises and enforced by local franchising
authorities''); Senate Comm. on Commerce, Science and
Transportation, S. Rep. No. 102-92, 102d Cong., 2d Sess. at 21
(1992), reprinted in 1992 U.S.C.C.A.N. 1133 (``Senate Report'')
(local franchising authorities, ``who are closest to the
consumer, would be in the best position to effectively address
[customer service issues]''); House Report at 105 (Congress
intended that the Commission would develop standards that are
sufficiently flexible in nature to allow local authorities to
tailor the rules to meet the needs of the local community and to
adopt more stringent standards in accordance with local needs).
Although the Senate version of Section 8 did not differ
substantially from the House version, the Conference Committee
adopted the latter. See H.R. Conf. Rep. No. 102-862, 102d Cong.,
2d Sess. at 79 (1992), reprinted in 1992 U.S.C.C.A.N. 1231
11 See Consumer Protection Order, 8 FCC Rcd at 2897, ¶ 19 (``it
does not appear that Congress intended for the Commission to bear
the responsibility of enforcing the new FCC standards''); id. at
2893, ¶ 3 (the customer service rules ``will then be enforced by
local franchising authorities''); id. at 2895, ¶ 10 (``the
Commission is required to establish baseline customer service
standards on which local governments may rely to ensure that the
cable systems they regulate provide an adequate level of customer
service''); id. at 2899, ¶ 26 (``Local franchise authorities will
enforce the self-executing Federal standards we adopt today'');
CPO Dismissal Order, 17 FCC Rcd at 11916 (``the Commission
established customer service standards which are subject to
enforcement by local franchising authorities.'') Because the
Commission found that the 1992 Act delegated enforcement of
customer service rules to the local franchising authorities, the
Commission determined that ``it is unnecessary for this
Commission to establish specific customer service reporting
requirements or refund or penalty guidelines applicable to all
cable operators nationwide. . . . Local governments should be
free to avail themselves of reasonable remedies to assure
compliance and fairness to all parties.'' Consumer Protection
Order, 8 FCC Rcd at 2898, ¶ 21.
12 47 C.F.R. §§ 76.1602(a), 76.1603(a).
13 Consumer Protection Order, 8 FCC Rcd at 2897, ¶ 19.
14 Complaint at 1; Response of Comcast Corporation to Questions
Posed By the Enforcement Bureau, File No. EB-01-MD-033 (filed
Sept. 20, 2002) (``Comcast Response to Commission Questions'') at
15 Complaint at 2. See Comcast Response to Commission Questions
16 Complaint at 2.
17 Reply to Comcast's Response to Commission's Questions of
September 20, 2002, File No. EB-02-MD-033 (filed Oct. 4, 2002)
(``WOW Reply to Commission Questions'') at 10.
18 Complaint at 1-2; Comcast Response to Commission Questions at
19 Complaint at 1-2; Comcast Response to Commission Questions at
20 Complaint at 3.
21 47 C.F.R. §§ 76.1602(b), 1603(b). See Complaint at 1, 5-6;
Reply at 1-3, 7-10; WOW Response to Commission Questions at 1-2,
4-6, 8-10; WOW Reply to Commission Questions at 7-9, 11-27. WOW
asserts that any price reduction must be disclosed to all
customers and the franchising authority within 30 days of making
the offer. See WOW Response to Commission Questions at 4. WOW
does not seek to enforce 47 C.F.R. § 76.1602(b), however, which
requires cable operators to notify customers 30 days in advance
of any rate changes. See Id. at 4-5.
22 Complaint at 6 (Comcast's conduct has ``one purpose alone - to
preclude other Comcast customers from receiving the same rates
and charges, thus diminishing the cost of eliminating competition
in the greater metropolitan Detroit market''); Comcast Response
to Commission Questions at 1-3, 6 (same); Reply to Opposition to
Complaint of WideOpen West Holdings, LLC, File No. EB-02-MD-033
(filed June 28, 2002) (``Reply'') at 1-2, 7 (same).
23 Complaint at 6.
24 Answer of Comcast Corporation and Request for Dismissal, File
No. EB-02-MD-033, (filed June 11, 2002) (``Answer'') at 3-6.
Comcast seeks dismissal of the complaint on several other
grounds, as well: as a competitor, WOW lacks standing to
challenge Comcast's compliance with the customer service rules;
the disclosure requirements do not encompass promotional or win-
back offers; and the challenged actions exemplify vigorous
competition, which is the broader legislative purpose of the 1992
Cable Act. Id. at 6-12.
25 See Complaint at 1, 4-6; Reply at 1, 3-4, 6-10; WOW Response
to Commission Questions at 1-2, 6-10; WOW Reply to Commission
Questions at 2, 17-18.
26 See Complaint at 1, 4-6; Reply at 1, 6-10; WOW Reply to
Commission Questions at 17-18.
27 Our review of the legislative history does not demonstrate
that the statutory objectives are definitively undermined without
the type of sweeping relief that WOW seeks. See generally H.R.
Rep. 104-204(I), 104th Cong., 1st Sess. at 112 (1995). Granted,
it is not surprising that Congress did not focus Section 8 on
win-back or retention offers because, at the time it enacted
Section 8, cable operators in virtually every region of the
country were monopoly providers.
28 We take no position on whether discrete types of win-back
behavior would run afoul of customer service standards for
communicating with subscribers or other provisions of the Act.
See 47 U.S.C. § 543(d); 47 C.F.R. §§ 76.901-990 (requiring inter
alia cable operators to have geographically uniform rates under
certain circumstances, with a stated objective ``to prevent cable
operators from dropping the rates in one portion of a franchise
area to undercut a competitor temporarily.'').
29 WOW Reply to Commission Questions at 16-17, citing Senate
Report at 27.
30 47 U.S.C. § 552(b).
31 See generally H.R. Rep. 104-204(I), 104th Cong., 1st Sess. at
112 (1995), reprinted in 1996 US.C.C.A.N. 10;``''``''. House
Report at ``''34-35``'''';``'' Senate Report at 20. ``''
32 See Complaint at 1, 4-6; Reply at 1, 6-10; WOW Reply to
Commission Questions at 17-18.
33 47 U.S.C. § 552(b).
34 Indeed, with respect to rates and bills specifically, Congress
appears to have been concerned primarily with ensuring that a
customer can understand his/her rate and programming choices and
then determine whether he/she is actually receiving the rates and
programming that he/she ordered. See generally H.R. Rep. 104-
204(I), 104th Cong., 1st Sess. at 112 (1995), reprinted in 1996
US.C.C.A.N. 10 (in amending 47 U.S.C. § 552 to permit notice of
rate changes ``by any reasonable means,'' Congress stated that
the ``purpose of a notice requirement is to ensure that consumers
have sufficient warning about rate and service changes so they
can choose to disconnect their service prior to the
implementation of the change''). More generally, Congress'
Section 8 objectives also included remedying prevalent consumer
complaints about day-to-day customer service issues, such as
office hours, telephone availability, installation outages,
service calls, and refunds. See e.g. House Report at 34 (``some
cable operators frequently break installation and repair
appointments, subject customers to frequent service
interruptions, fail to answer customer calls or place customers
on hold for extended periods.''); id. at 34-35 (``The results of
a New York City survey of cable subscribers'' demonstrated that
more than half [the respondents] encountered a busy signal the
last time they telephoned the cable company. And of those
respondents ultimately connected by telephone, approximately one-
half were put on `hold' for longer than one minute''); id. at 35
(a Consumer Reports survey revealed that ``about 60 percent of
respondents experienced service outages . . . one in eight
respondents experienced billing problems . . . and
respondents reported that they had difficulty reaching the cable
company by telephone nearly 50 percent of the times they tried.
Respondents also reported that in roughly 15 percent of the times
a service call was made in person, the installation or repair was
done improperly, and in another 15 percent of the times, the
service person failed to keep the service appointment''); Senate
Report at 20 (``the Committee has found that many cable operators
provide poor service to their customers. Phones are not answered
promptly, if at all. Offices are open for a minimal number of
hours. Service calls take far too long''). WOW presents no
evidence that Comcast's conduct at issue here undermines any of
these statutory objectives.
35 See Senate Report at 8 (``A cable system serving a local
community, with rare exceptions, enjoys a monopoly''); id. at 13
(``out of over 11,000 cable systems, there are only 53
communities where there is currently some overbuild''); House
Report at 165. Note that WOW was not established until 1999.
Complaint at 2.
36 See 47 U.S.C. § 543(d); 47 C.F.R. §§ 76.901-990. Section 3
contains a provision requiring cable operators to have
geographically uniform rates under certain circumstances, and one
of the stated objectives of the provision is ``to prevent cable
operators from dropping the rates in one portion of a franchise
area to undercut a competitor temporarily.'' Senate Report at 76.
See 47 U.S.C. § 543.
37 WOW Reply to Commission Questions at 16-17, citing Senate
Report at 27.
38 See Senate Report at 21. (enumerating the following cable
service problems to be rectified by the FCC standards:
``inequitable billing practices, unreasonable responses to cable
outages, rebates during outages, time frames for installation and
the telephone answering services provided by the operator to
handle consumer complaints.'')
39 See, e.g., Complaint at 1 (the ``sole purpose'' of Comcast's
conduct is ``an effort to drive WideOpen West from those markets
in which it competes directly with Comcast.''); id. at 2, 6;
Reply at 2, 7.
40 47 U.S.C. § 543(d); 47 C.F.R. § 76.984. We note that, by
describing potential avenues for WOW to seek relief, we express
no view on the ultimate validity of such claims on the merits.