97-5350. Commercial Availability of Navigation Devices  

  • [Federal Register Volume 62, Number 43 (Wednesday, March 5, 1997)]
    [Proposed Rules]
    [Pages 10011-10016]
    From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
    [FR Doc No: 97-5350]
    
    
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    FEDERAL COMMUNICATIONS COMMISSION
    47 CFR Part 76
    
    [CS Docket No. 97-80; FCC 97-53]
    
    
    Commercial Availability of Navigation Devices
    
    AGENCY: Federal Communications Commission.
    
    ACTION: Notice of proposed rulemaking.
    
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    SUMMARY: The Federal Communications Commission seeks comments on 
    proposals to implement Section 629 of the Communications Act of 1934, 
    as amended, 47 U.S.C. 549, concerning the commercial availability of 
    navigation devices. This notice is prompted by Section 304 of the 1996 
    Telecommunications Act, which became law on February 5, 1996, adding 
    this provision to the Communications Act. This action is intended to 
    implement the 1996 Act.
    
    
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    DATES: Comments are due on or before May 16, 1997 and reply comments 
    are due on or before June 16, 1997.
    
    ADDRESSES: Federal Communications Commission, 1919 M Street, NW., 
    Washington, DC 20554.
    
    FOR FURTHER INFORMATION, CONTACT: Technical Information: Michael Lance, 
    Cable Services Bureau, (202) 418-7014. Legal Information: Barrett L. 
    Brick, Cable Services Bureau, (202) 418-1065.
    
    SUPPLEMENTARY INFORMATION: This is a synopsis of the Commission's 
    Notice of Proposed Rulemaking, CS Docket No. 97-80, adopted February 
    11, 1997 and released on February 20, 1997. The full text of this 
    decision is available for inspection and copying during normal business 
    hours in the FCC Reference Center (Room 239), 1919 M Street, NW., 
    Washington, DC 20554, and may be purchased from the Commission's copy 
    contractor, International Transcription Service, (202) 857-3800, 1919 M 
    Street, NW., Washington, DC 20554.
    
    Synopsis of the Notice of Proposed Rule Making
    
        1. In this notice of proposed rulemaking, the Commission seeks 
    comment on proposals to implement Section 629 of the Communications 
    Act, added as part of the Telecommunications Act of 1996, Public Law 
    104-104, 110 Stat. 56 (1996) (1996 Act). Section 629 instructs the 
    Commission to promote the commercial availability to consumers of 
    navigation devices: That is, equipment used to access multichannel 
    video programming and other services offered over multichannel video 
    programming systems. The Commission is also instructed not to 
    jeopardize the security of services offered over multichannel video 
    programming systems.
        2. The Commission first seeks comment regarding the scope and 
    meaning of Section 629. The Commission tentatively concludes that the 
    coverage of Section 629 is broad in terms of the multichannel video 
    programming distributors (MVPDs) involved, including cable television, 
    multichannel broadcast television, DBS, MMDS, and SMATVs. The 
    Commission also tentatively concludes that Section 629 is broad in 
    terms of the type of equipment covered, including not just equipment 
    used to receive video programming, but also equipment used to access 
    other services offered by MVPDs over their systems. The Commission 
    seeks comments on these conclusions, and also on methods to narrow the 
    focus of the rulemaking process and rules adopted in order best to 
    accomplish the statutory objectives.
        3. The Commission seeks comment on the meaning of commercial 
    availability in the context of Section 629. The Commission proposes to 
    incorporate a consumer right to attach equipment into the rules, 
    modeled after the telephony right to attach which had its genesis in 
    Carterphone, 13 FCC 2d 420, recon. denied, 14 FCC 2d 571 (1968), and 
    seeks comment on this proposal. The Commission recognizes that in 
    implementing Section 629, there is a need to assure that customer 
    premises equipment (CPE) does not cause harm to the network to which 
    the CPE is attached, and that the networks technical integrity is 
    maintained. The Commission seeks comment on how best to accomplish this 
    task. The Commission tentatively concludes that existing Part 15 
    certification rules should adequately address signal leakage issues 
    surrounding existing navigation devices, and seeks comment on this 
    conclusion. The Commission also seeks comment on whether the 
    marketplace will sufficiently address signal quality issues involving 
    navigation devices.
        4. Section 629 requires that navigation devices be commercially 
    available from vendors not affiliated with any MVPD. The Commission 
    tentatively concludes that the definition of affiliate in Section 3 of 
    the 1996 Act, which establishes a ten percent equity interest 
    threshold, is applicable to Section 629 and seeks comment on this 
    conclusion.
        5. The Commission seeks comment not only on issues raised by 
    current equipment distribution models, but also on whether and what 
    degree of standardization might be necessary so that navigation devices 
    may be geographically portable or may be interoperable to function with 
    different types of MVPDs or both. The Commission seeks comment on the 
    incremental cost of additional capabilities in this context. The 
    Commission also seeks comment on the process whereby any necessary 
    standards might be developed to promote competition. The Commission 
    states its desire not to develop standards itself, but rather urges the 
    adoption of voluntary standards by those affected. The Commission seeks 
    comment on the techniques it should use should standards prove to be 
    necessary or desirable toward assuring the commercial availability of 
    navigation devices, including alternatives to actual standard setting.
        6. The Commission recognizes that some of the technologies 
    implicated by this proceeding may be wholly or partially proprietary in 
    nature. The Commission seeks comment on its authority to affect 
    proprietary rights, and on what limitations existing proprietary rights 
    may place on the Commission's authority to mandate commercial 
    availability of navigation devices.
        7. Section 629 instructs the Commission not to jeopardize the 
    security of services offered over multichannel video programming 
    systems, nor to impede service providers' legal rights to prevent theft 
    of service. In order to fashion effective rules that fulfill this 
    requirement, the Commission seeks data and information on existing 
    security methodologies employed by MVPD industries, and seeks comment 
    on what it means to jeopardize security and to impede a programmer's 
    rights to prevent theft of service. The Commission recognizes that 
    equipment that performs security functions is often combined with 
    equipment that performs other functions. The Commission seeks comment 
    on the possibility of unbundling security from nonsecurity equipment. 
    The Commission tentatively concludes, should such unbundling be 
    necessary, that the preferred option for developing the necessary 
    framework to accomplish this would be to adopt only a conduct or 
    performance rule mandating the separation involved, leaving to the 
    industry participants involved the task of developing the necessary 
    interface standards. The Commission also seeks comment on whether the 
    affected industries could voluntarily adopt and the Commission approve 
    a variant of the decoder interface connector discussed in the First 
    Report and Order in ET Docket No. 93-7, 9 FCC Rcd 1981, 59 FR 25339 
    (May 16, 1994) and in the Memorandum Opinion and Order in ET Docket No. 
    93-7, 11 FCC Rcd 4121, 61 FR 18508 (April 26, 1996). The Commission 
    also seeks comment on the impact of the 1996 Act's amendments to 
    Section 624A of the Communications Act on the Commission's authority 
    under Section 629.
        8. Section 629 allows MVPDs to offer navigation devices to 
    consumers if the charges are separately stated and not subsidized by 
    charges for the service accessed by the devices. The Commission 
    tentatively concludes that continuing with existing forms of 
    regulations that are broadly intended to constrain the subsidization of 
    equipment prices from regulated service revenues is most consistent 
    with the 1996 Act, and seeks comment on this conclusion, as well as on 
    alternative means of addressing subsidy issues.
        9. Section 629 requires the Commission to waive any implementing
    
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    regulation adopted for a limited period of time upon an appropriate 
    showing that such a waiver is necessary to assist the development or 
    introduction of new or improved multichannel video programming or other 
    service offered over multichannel video programming systems, 
    technology, or products. The Commission tentatively concludes that 
    where such waivers are required and requested, these requests should be 
    looked upon sympathetically and expansively. The Commission seeks 
    comment on this analysis. The Commission also seeks comment on whether 
    guidelines need to be set to define the limited time contemplated, and 
    also on whether the Commission's existing waiver procedures need to be 
    modified to comply with the statutory mandate that the Commission act 
    on a waiver within 90 days of its filing.
        10. Section 629 provides that implementing regulations which are 
    adopted shall cease to apply upon a Commission determination that the 
    MVPD market is fully competitive, that the market for navigation 
    devices is fully competitive, and that elimination of the regulations 
    will promote competition and the public interest. The Commission seeks 
    comment on the service category and geographic market analyses 
    required, as well as the circumstances in general under which 
    regulatory involvement might terminate. The Commission tentatively 
    concludes that regulations for certain types of equipment may not need 
    to be adopted in the first place if competition is already fully 
    robust, and seeks comment on this conclusion.
    
    Initial Regulatory Flexibility Analysis
    
        11. As required by Section 603 of the Regulatory Flexibility Act 
    (``RFA''), 1 the Commission has prepared the following Initial 
    Regulatory Flexibility Analysis (``IRFA'') of the expected significant 
    economic impact on small entities by the policies and rules proposed in 
    this Notice of Proposed Rulemaking. Written public comments are 
    requested on the IRFA. These comments must be filed in accordance with 
    the same filing deadlines as comments on the rest of the Notice but 
    they must have a separate and distinct heading designating them as 
    responses to the IRFA. The Secretary shall send a copy of this Notice 
    to be sent to the Chief Counsel for Advocacy of the Small Business 
    Administration (``SBA'') in accordance with 5 U.S.C. 603(a).
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        \1\ 5 U.S.C. 603. The RFA has been amended by the Contract With 
    America Advancement Act of 1996, Public Law 104-121, 110 Stat. 847 
    (1996) (``CWAAA''). Title II of the CWAAA is the ``Small Business 
    Regulatory Enforcement Fairness Act of 1996'' (``SBREFA''), codified 
    at 5 U.S.C. 601 et seq.
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        12. Need for and Objectives of the Proposed Rules: The 1996 Act 
    requires the Commission to promulgate rules designed to promote the 
    commercial availability of navigation devices. The Commission is 
    issuing this Notice to seek comment on the proposed rules intended to 
    implement this provision of the 1996 Act, and to provide a record for a 
    Commission decision on issues discussed in the Notice.
        13. Legal Basis: Authority for this proposed rulemaking is 
    contained in Sections 4(i), 4(j), 303(r), and 629 of the Communications 
    Act of 1934 as amended, 47 U.S.C. 154(i), 154(j), 303(r), and Secs. 304 
    and 549 of the Telecommunications Act of 1996, Public Law 104-104, 110 
    Stat. 56 (1996).
        14. Description and Estimate of Small Entities to Which the 
    Proposed Rules Will Apply: Implementation of Section 304 will have the 
    positive result of opening up to small entities the market to supply 
    navigation devices directly to cable and other subscribers. In 
    addition, small businesses will have the opportunity to become the 
    manufacturers of navigation devices. While any policies or rules 
    developed in this proceeding could have an impact on small businesses 
    that manufacture, distribute, or use converter boxes, interactive 
    communications equipment, and other equipment used by consumers to 
    access multichannel video programming and other services offered over 
    multichannel video programming systems, this proceeding seeks comment 
    on how this burden, if any, could be mitigated for small entities.
        15. The Regulatory Flexibility Act defines the term ``small 
    entity'' as having the same meaning as the terms ``small business,'' 
    ``small organization,'' and ``small business concern'' under Section 3 
    of the Small Business Act. 2 A small concern is one which: (1) Is 
    independently owned and operated; (2) is not dominant in its field of 
    operation; and (3) satisfies any additional criteria established by the 
    SBA.
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        \2\ 5 U.S.C. 601(3) (1980).
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        16. Small MVPDs: SBA has developed a definition of small entity for 
    cable and other pay television services, which includes all such 
    companies generating less than $11 million in revenue annually. This 
    definition includes cable systems operators, closed circuit television 
    services, direct broadcast satellite services, multipoint distribution 
    systems, satellite master antenna systems and subscription television 
    services. According to the Census Bureau, there were 1,323 such cable 
    and other pay television services generating less than $11 million in 
    revenue that were in operation for at least one year at the end of 
    1992.3
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        \3\ U.S. Census Bureau, 1992 Economic Census, 1992 Census of 
    Transportation, Communications and Utilities at Firm Size 1-123.
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        17. Cable Systems: The Commission has developed its own definition 
    of a small cable system operator for the purposes of rate regulation. 
    Under the Commission's rules, a ``small cable company,'' is one serving 
    fewer than 400,000 subscribers nationwide. 4 Based on our most 
    recent information, we estimate that there were 1,439 cable operators 
    that qualified as small cable system operators at the end of 
    1995.5 Since then, some of those companies may have grown to serve 
    over 400,000 subscribers, and others may have been involved in 
    transactions that caused them to be combined with other cable 
    operators. Consequently, we estimate that there are fewer than 1,439 
    small entity cable system operators that may be affected by the 
    decisions and rules proposed in this Notice.
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        \4\ 47 CFR 76.901(e). The Commission developed this definition 
    based on its determinations that a small cable system operator is 
    one with annual revenues of $100 million or less. Implementation of 
    Sections of the 1992 Cable Act: Rate Regulation, Sixth Report and 
    Order and Eleventh Order on Reconsideration, 10 FCC Rcd 7393, 60 FR 
    35854 (July 12, 1995).
        \5\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 
    1996 (based on figures for Dec. 30, 1995).
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        18. The Communications Act also contains a definition of a small 
    cable system operator, which is ``a cable operator that, directly or 
    through an affiliate, serves in the aggregate fewer than 1% of all 
    subscribers in the United States and is not affiliated with any entity 
    or entities whose gross annual revenues in the aggregate exceed 
    $250,000,000.'' 6 The Commission has determined that there are 
    61,700,000 subscribers in the United States. Therefore, we found that 
    an operator serving fewer than 617,000 subscribers shall be deemed a 
    small operator, if its annual revenues, when combined with the total 
    annual revenues of all of its affiliates, do not exceed $250 million in 
    the aggregate.7 Based on available data, we find that the number 
    of cable operators serving 617,000 subscribers or less totals 1,450. 
    8 Although it seems certain that some of these cable system 
    operators are affiliated with entities whose gross annual revenues 
    exceed $250,000,000, we are unable at this time to estimate with 
    greater precision the
    
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    number of cable system operators that would qualify as small cable 
    operators under the definition in the Communications Act.
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        \6\ 47 U.S.C. 543(m)(2).
        \7\ 47 CFR 76.1403(b).
        \8\ Paul Kagan Associates, Inc., Cable TV Investor, Feb. 29, 
    1996 (based on figures for Dec. 30, 1995).
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        19. MMDS: The Commission refined the definition of ``small entity'' 
    for the auction of MMDS as an entity that together with its affiliates 
    has average gross annual revenues that are not more than $40 million 
    for the preceding three calendar years.9 This definition of a 
    small entity in the context of the Commission's Report and Order 
    concerning MMDS auctions that has been approved by the SBA.10
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        \9\ 47 CFR 21.961(b)(1).
        \10\ See Amendment of Parts 21 and 74 of the Commission's Rules 
    With Regard to Filing Procedures in the Multipoint Distribution 
    Service and in the Instructional Television Fixed Service and 
    Implementation of Section 309(j) of the Communications Act--
    Competitive Bidding, MM Docket No. 94-31 and PP Docket No. 93-253, 
    Report and Order, 10 FCC Rcd 9589, 60 FR 36524 (July 17, 1995).
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        20. The Commission completed its MMDS auction in March 1996 for 
    authorizations in 493 basic trading areas (``BTAs''). Of 67 winning 
    bidders, 61 qualified as small entities. Five bidders indicated that 
    they were minority-owned and four winners indicated that they were 
    women-owned businesses. MMDS is an especially competitive service, with 
    approximately 1573 previously authorized and proposed MMDS facilities. 
    Information available to us indicates that no MDS facility generates 
    revenue in excess of $11 million annually. We tentatively conclude that 
    for purposes of this IRFA, there are approximately 1634 small MMDS 
    providers as defined by the SBA and the Commission's auction rules.
        21. ITFS: There are presently 2032 ITFS licensees. All but one 
    hundred of these licenses are held by educational institutions. 
    Educational institutions are included in the definition of a small 
    business.11 However, we do not collect annual revenue data for 
    ITFS licensees and are not able to ascertain how many of the 100 non-
    educational licensees would be categorized as small under the SBA 
    definition. Thus, we tentatively conclude that at least 1932 licensees 
    are small businesses.
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        \11\ SBREFA also applies to nonprofit organizations and 
    governmental organizations such as cities, counties, towns, 
    townships, villages, school districts, or special districts, with 
    populations of less than 50,000. 5 U.S.C. 601(5).
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        22. DBS: As of December 1996, there were eight DBS licensees. 
    However, the Commission does not collect annual revenue data for DBS 
    and, therefore, is unable to ascertain the number of small DBS 
    licensees that could be impacted by these proposed rules. Although DBS 
    service requires a great investment of capital for operation, we 
    acknowledge that there are several new entrants in this field that may 
    not yet have generated $11 million in annual receipts, and therefore 
    may be categorized as a small business, if independently owned and 
    operated.
        23. HSD: The market for HSD service is difficult to quantify. 
    Indeed, the service itself bears little resemblance to other MVPDs. HSD 
    owners have access to more than 265 channels of programming placed on 
    C-band satellites by programmers for receipt and distribution by MVPDs, 
    of which 115 channels are scrambled and approximately 150 are 
    unscrambled.12 HSD owners can watch unscrambled channels without 
    paying a subscription fee. To receive scrambled channels, however, an 
    HSD owner must purchase an integrated receiver-decoder from an 
    equipment dealer and pay a subscription fee to an HSD programming 
    packager. Thus, HSD users include: (1) Viewers who subscribe to a 
    packaged programming service, which affords them access to most of the 
    same programming provided to subscribers of other MVPDs; (2) viewers 
    who receive only non-subscription programming; and (3) viewers who 
    receive satellite programming services illegally without subscribing. 
    Because scrambled packages of programming are most specifically 
    intended for retail consumers, these are the services most relevant to 
    this discussion.13
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        \12\ Report in CS Docket No. 96-133 (``1996 Competition 
    Report''), FCC 96-496 at para. 49, 62 FR 5627 (February 6, 1997).
        \13\ Id.
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        24. According to the most recently available information, there are 
    approximately 30 program packagers nationwide offering packages of 
    scrambled programming to retail consumers.14 These program 
    packagers provide subscriptions to approximately 2,314,900 subscribers 
    nationwide.15 This is an average of about 77,163 subscribers per 
    program packager. This is substantially smaller than the 400,000 
    subscribers used in the Commission's definition of a small MSO. 
    Furthermore, because this an average, it is likely that some program 
    packagers may be substantially smaller.
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        \14\ Id.
        \15\ Id.
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        25. SMATVs: Industry sources estimate that approximately 5200 SMATV 
    operators were providing service as of December 1995.16 Other 
    estimates indicate that SMATV operators serve approximately 1.05 
    million residential subscribers as of September 1996.17 The ten 
    largest SMATV operators together pass 815,740 units.18 If we 
    assume that these SMATV operators serve 50% of the units passed, the 
    ten largest SMATV operators serve approximately 40% of the total number 
    of SMATV subscribers. Because these operators are not rate regulated, 
    they are not required to file financial data with the Commission. 
    Furthermore, we are not aware of any privately published financial 
    information regarding these operators. Based on the estimated number of 
    operators and the estimated number of units served by the largest ten 
    SMATVs, we tentatively conclude that a substantial number of SMATV 
    operators qualify as small entities.
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        \16\ 1996 Competition Report at para.81.
        \17\ Id.
        \18\ Id.
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        26. LMDS: Unlike the above pay television services, LMDS technology 
    and spectrum allocation will allow licensees to provide wireless 
    telephony, data, and/or video services. A LMDS provider is not limited 
    in the number of potential applications that will be available for this 
    service. Therefore, the definition of a small LMDS entity may be 
    applicable to both cable and other pay television (SIC 4841) and/or 
    radiotelephone communications companies (SIC 4812). A small 
    radiotelephone entity is one with 1500 employees or less.19 
    However, for the purposes of this Notice, we include only an estimate 
    of LMDS video service providers.
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        \19\ 13 CFR Sec. 121.201.
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        27. LMDS is a service that is expected to be auctioned by the FCC 
    in 1997. The vast majority of LMDS entities providing video 
    distribution could be small businesses under the SBA's definition of 
    cable and pay television (SIC 4841). However, in the Third NPRM, we 
    proposed to define a small LMDS provider as an entity that, together 
    with affiliates and attributable investors, has average gross revenues 
    for the three preceding calendar years of less than $40 million.20 
    We have not yet received approval by the SBA for this definition.
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        \20\ In the Matter of Rulemaking to Amend Parts 1, 2, 21, and 25 
    of the Commission's Rules to Redesignate the 27.5-29.5 GHz Frequency 
    Band, to Reallocate the 29.5-30.0 GHz Frequency Band, to Establish 
    Rules and Policies for Local Multipoint Distribution Service and for 
    Fixed Satellite Services and Suite 12 Group Petition for Pioneer's 
    Preference (``Third NPRM''), CC Docket No. 92-297, 11 FCC Rcd 53, at 
    ]188, 60 FR 43740 (August 23, 1995).
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        28. There is only one company, CellularVision, that is currently 
    providing LMDS video services. Although the Commission does not collect 
    data on annual receipts, we assume that CellularVision is a small 
    business under both the SBA definition
    
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    and our proposed auction rules. We tentatively conclude that a majority 
    of the potential LMDS licensees will be small entities, as that term is 
    defined by the SBA and the Commission's proposed definition.
        29. Small Manufacturers: The SBA has developed definitions of small 
    entity for manufacturers of household audio and video equipment (SIC 
    3651) and for radio and television broadcasting and communications 
    equipment (SIC 3663). In each case, the definition includes all such 
    companies employing 750 or fewer employees.
        30. Electronic Equipment Manufacturers: The Commission has not 
    developed a definition of small entities applicable to manufacturers of 
    electronic equipment. Therefore, we will utilize the SBA definition of 
    manufacturers of Radio and Television Broadcasting and Communications 
    Equipment.21 According to the SBA's regulations, a TV equipment 
    manufacturer must have 750 or fewer employees in order to qualify as a 
    small business concern.22 Census Bureau data indicates that there 
    are 858 U.S. firms that manufacture radio and television broadcasting 
    and communications equipment, and that 778 of these firms have fewer 
    than 750 employees and would be classified as small entities.23 
    The Census Bureau category is very broad, and specific figures are not 
    available as to how many of these firms are exclusive manufacturers of 
    television equipment or how many are independently owned and operated. 
    We conclude that there are approximately 778 small manufacturers of 
    radio and television equipment.
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        \21\ This category excludes establishments primarily engaged in 
    the manufacturing of household audio and visual equipment which is 
    categorized as SIC 3651. See infra for SIC 3651 data.
        \22\  13 CFR 121.201, (SIC) Code 3663.
        \23\ U.S. Dept. of Commerce, 1992 Census of Transportation, 
    Communications and Utilities, Table 1D, (issued May 1995), SIC 
    category 3663.
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        31. Electronic Household/Consumer Equipment: The Commission has not 
    developed a definition of small entities applicable to manufacturers of 
    electronic equipment used by consumers, as compared to industrial use 
    by television licensees and related businesses. Therefore, we will 
    utilize the SBA definition applicable to manufacturers of Household 
    Audio and Visual Equipment. According to the SBA's regulations, a 
    household audio and visual equipment manufacturer must have 750 or 
    fewer employees in order to qualify as a small business concern.24 
    Census Bureau data indicates that there are 410 U.S. firms that 
    manufacture radio and television broadcasting and communications 
    equipment, and that 386 of these firms have fewer than 500 employees 
    and would be classified as small entities.25 The remaining 24 
    firms have 500 or more employees; however, we are unable to determine 
    how many of those have fewer than 750 employees and therefore, also 
    qualify as small entities under the SBA definition. Furthermore, the 
    Census Bureau category is very broad, and specific figures are not 
    available as to how many of these firms are exclusive manufacturers of 
    television equipment for consumers or how many are independently owned 
    and operated. We conclude that there are approximately 386 small 
    manufacturers of television equipment for consumer/household use.
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        \24\ 13 CFR 121.201, (SIC) Code 3651.
        \25\ U.S. Small Business Administration 1995 Economic Census 
    Industry and Enterprise Report, Table 3, SIC Code 3651, (Bureau of 
    the Census data adapted by the Office of Advocacy of the U.S. Small 
    Business Administration).
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        32. Computer Manufacturers: The Commission has not developed a 
    definition of small entities applicable to computer manufacturers. 
    Therefore, we will utilize the SBA definition of Electronic Computers. 
    According to SBA regulations, a computer manufacturer must have 1,000 
    or fewer employees in order to qualify as a small entity.26 Census 
    Bureau data indicates that there are 716 firms that manufacture 
    electronic computers and of those, 659 have fewer than 500 employees 
    and qualify as small entities.27 The remaining 57 firms have 500 
    or more employees; however, we are unable to determine how many of 
    those have fewer than 1,000 employees and therefore also qualify as 
    small entities under the SBA definition. We conclude that there are 
    approximately 659 small computer manufacturers.
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        \26\ 13 CFR 121.201, (SIC) Code 3571.
        \27\ U.S. Small Business Administration 1995 Economic Census 
    Industry and Enterprise Report, Table 3, SIC Code 3571, (Bureau of 
    the Census data adapted by the Office of Advocacy of the U.S. Small 
    Business Administration).
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        33. Small Retailers: The Commission has not developed a definition 
    of small entities applicable to navigation retail devices. Therefore, 
    we will utilize the SBA definition. The 1992 Bureau of the Census data 
    indicates: there were 9,663 U.S. firms classified as Radio, TV & 
    electronic stores (SIC 5731), and that 9,385 of these firms had $4.999 
    million or less in annual receipts and 9,473 of these firms had $7.499 
    million or less in annual receipts.28 Consequently, we tentatively 
    conclude that there are approximately 9,663 small entities that produce 
    and distribute radio, television, and electronic stores that may be 
    affected by the decisions and rules proposed in this Notice.
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        \28\ U.S. Small Business Administration 1992 Economic Census 
    Industry and Enterprise Report, Table 2D, SIC 7812, (Bureau of the 
    Census data adapted by the Office of Advocacy of the U.S. Small 
    Business Administration) (SBA 1992 Census Report). The Census data 
    does not include a category for $6.5 million therefore, we have 
    reported the closest increment below and above the $6.5 million 
    threshold. There is a difference of 88 firms between the $4.999 and 
    $7.499 million annual receipt categories. It is possible that these 
    88 firms could have annual receipts of $6.5 million or less and 
    therefore, would be classified as small businesses.
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        34. Reporting, Recordkeeping, and Other Compliance Requirements: 
    The proposed actions may require MVPDs to obtain security modules for 
    sale to subscribers. They may also prohibit MVPDs from providing CPE 
    which is not commercially available. In addition, the proposed actions 
    may require MVPDs to make available to consumers basic technical 
    information concerning the network to which a navigation device is to 
    be attached (paragraph 56). This latter proposal, if adopted, would not 
    necessitate any additional professional, engineering, or customer 
    service skills beyond those already utilized in the ordinary course of 
    business by MVPDs. Any costs to the MVPD would be justified by the 
    competitive benefits; MVPDs and consumers will benefit from an 
    increased, more innovative, and more competitive market for navigation 
    devices. We seek comment on this.
        35. Any Significant Alternatives Minimizing the Impact On Small 
    Entities Consistent With the Stated Objectives: We believe that our 
    proposals will have the positive result of opening up to small entities 
    the market to supply navigation devices directly to cable and other 
    subscribers (see discussion at paragraph 84). In addition, small 
    businesses will have the opportunity to become the manufacturers of 
    navigation devices (see discussion at paragraph 84). While small 
    businesses would experience costs associated with maintaining for sale 
    navigation devices, should we adopt rules that would require such, we 
    believe such businesses are capable of doing so. Should commenters 
    disagree with this conclusion, we welcome comments suggesting ways in 
    which any perceived burden upon small entities could be mitigated.
        36. Federal Rules Which Overlap, Duplicate or Conflict with 
    Proposed Rules: None.
    
    Ex Parte
    
        37. This is a non-restricted notice and comment rule making 
    proceeding. Ex
    
    [[Page 10016]]
    
    parte presentations are permitted, provided they are disclosed as 
    provided in the Commission's Rules. See generally 47 CFR 1.1202, 1.1203 
    and 1.1206(a).
    
    Comment Dates
    
        38. Pursuant to applicable procedures set forth in Secs. 1.415 and 
    1.419 of the Commission's Rules, interested parties may file comments 
    on or before May 16, 1997 and reply comments on or before June 16, 
    1997. All relevant and timely comments will be considered before final 
    action is taken in this proceeding. To file formally in this 
    proceeding, participants must file an original and four copies of all 
    comments, reply comments, and supporting comments. If participants want 
    each Commissioner to receive a personal copy of their comments, an 
    original plus nine copies must be filed. Comments and reply comments 
    should be sent to the Office of the Secretary, Federal Communications 
    Commission, Washington, D.C. 20554. Comments and reply comments will be 
    available for public inspection during regular business hours in the 
    FCC Reference Center (Room 239) of the Federal Communications 
    Commission, 1919 M Street, NW, Washington, DC 20554.
    
    List of Subjects in 47 CFR Part 76
    
        Cable television.
    
    Federal Communications Commission.
    William F. Caton,
    Acting Secretary.
    [FR Doc. 97-5350 Filed 3-4-97; 8:45 am]
    BILLING CODE 6712-01-P
    
    
    

Document Information

Published:
03/05/1997
Department:
Federal Communications Commission
Entry Type:
Proposed Rule
Action:
Notice of proposed rulemaking.
Document Number:
97-5350
Dates:
Comments are due on or before May 16, 1997 and reply comments are due on or before June 16, 1997.
Pages:
10011-10016 (6 pages)
Docket Numbers:
CS Docket No. 97-80, FCC 97-53
PDF File:
97-5350.pdf
CFR: (1)
47 CFR 76