Herring Broadcasting, Inc. d/b/a WealthTV, Complainant v. Time Warner Cable Inc., Defendant; File No. CSR-7709-P; Herring Broadcasting, Inc. d/b/a WealthTV, Complainant v. Bright House Networks, LLC, Defendant; File No. CSR-7822-P; Herring Broadcasting, Inc. d/b/a WealthTV, Complainant v. Cox Communications, Inc., Defendant; File No. CSR-7829-P; Herring Broadcasting, Inc. d/b/a WealthTV, Complainant v. Comcast Corporation, Defendant; File No. CSR-7907-P; NFL Enterprises LLC, Complainant v. Comcast Cable Communications, LLC, Defendant; File No. CSR-7876-P; TCR Sports Broadcasting Holding, L.L.P., d/b/a Mid-Atlantic Sports Network, Complainant v. Comcast Corporation, Defendant; File No. CSR-8001-P, 65312-65329 [E8-26147]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 73, Number 213 (Monday, November 3, 2008)]
[Notices]
[Pages 65312-65329]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-26147]


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FEDERAL COMMUNICATIONS COMMISSION

[MB Docket No. 08-214; DA 08-2269]


Herring Broadcasting, Inc. d/b/a WealthTV, Complainant v. Time 
Warner Cable Inc., Defendant; File No. CSR-7709-P; Herring 
Broadcasting, Inc. d/b/a WealthTV, Complainant v. Bright House 
Networks, LLC, Defendant; File No. CSR-7822-P; Herring Broadcasting, 
Inc. d/b/a WealthTV, Complainant v. Cox Communications, Inc., 
Defendant; File No. CSR-7829-P; Herring Broadcasting, Inc. d/b/a 
WealthTV, Complainant v. Comcast Corporation, Defendant; File No. CSR-
7907-P; NFL Enterprises LLC, Complainant v. Comcast Cable 
Communications, LLC, Defendant; File No. CSR-7876-P; TCR Sports 
Broadcasting Holding, L.L.P., d/b/a Mid-Atlantic Sports Network, 
Complainant v. Comcast Corporation, Defendant; File No. CSR-8001-P

AGENCY: Federal Communications Commission.

ACTION: Notice.

-----------------------------------------------------------------------

SUMMARY: This document designates six program carriage complaints for a 
hearing to resolve the factual disputes with respect to the claims and 
to return a recommended decision and a recommended remedy, if 
necessary, to the Commission by December 9, 2008.

DATES: Each party to an above-captioned proceeding, in person or by its 
attorney, shall file with the Commission, by October 17, 2008, a 
written appearance stating that the party will appear on the date fixed 
for hearing and present evidence on the issues specified herein. Each 
party to an above-captioned proceeding must submit to the Commission, 
in writing within ten days of this Order (i.e., by October 20, 2008), 
their respective elections as to whether each wishes to proceed to 
Alternative Dispute Resolution. In each above-captioned proceeding, the 
Administrative Law Judge, within 60 days of this Order (i.e., by 
December 9, 2008), will resolve all factual disputes and submit a 
recommended decision and remedy, if appropriate.

ADDRESSES: Federal Communications Commission, 445 12th Street, SW., 
Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: For additional information on this 
proceeding, contact Steven Broeckaert, Steven.Broeckaert@fcc.gov, or 
David Konczal, David.Konczal@fcc.gov, of the Media Bureau, Policy 
Division, (202) 418-2120.

SUPPLEMENTARY INFORMATION: This is a summary of the Memorandum Opinion 
and Hearing Designation Order, DA 08-2269, adopted and released on 
October 10, 2008, and the Erratum thereto, adopted and released on 
October 15, 2008. The full text of this document is available for 
public inspection and copying during regular business hours in the FCC 
Reference Center, Federal Communications Commission, 445 12th Street, 
SW., CY-A257, Washington, DC 20554. This document will also be 
available via ECFS (https://www.fcc.gov/cgb/ecfs/). (Documents will be 
available electronically in ASCII, Word 97, and/or Adobe Acrobat.) The 
complete text may be purchased from the Commission's copy contractor, 
445 12th Street, SW., Room CY-B402, Washington, DC 20554. To request 
this document in accessible formats (computer diskettes, large print, 
audio recording, and Braille), send an e-mail to fcc504@fcc.gov or call 
the Commission's Consumer and Governmental Affairs Bureau at (202) 418-
0530 (voice), (202) 418-0432 (TTY).

Synopsis of the Order

I. WealthTV Complaints

    1. WealthTV is a video programming vendor as defined in Section 
616(b) of the Act and Section 76.1300(e) of the Commission's rules. 
WealthTV focuses on ``inspirational and aspirational programming about 
prosperous and fulfilling lifestyles.'' WealthTV states that it is a 
``truly independent stand-alone programming service'' and is not 
supported by or affiliated with any MVPD, telephone company, or 
broadcaster. WealthTV is currently carried by over 75 MVPDs.
    2. WealthTV had filed program carriage complaints against Time 
Warner Cable Inc. (``TWC''), Bright House Networks, LLC (``BHN''), Cox 
Communications, Inc. (``Cox''), and Comcast Corporation (``Comcast''). 
WealthTV asks the Commission to order TWC, BHN, Cox, and Comcast to 
provide WealthTV carriage on all TWC, BHN, Cox, and Comcast systems 
without delay, pursuant to the terms of a carriage agreement similar to 
that accorded to MOJO. To the extent one or more of the systems claim 
to lack capacity to add an additional channel, WealthTV asks the 
Commission to order the system to delete an affiliated programming 
service to accommodate the addition of WealthTV.
    3. We note that, at the time WealthTV requested carriage, the 
defendants carried MOJO in the relevant cable systems. Although iN 
DEMAND recently announced that MOJO will cease operations on December 
1, 2008, this does not render moot or discredit WealthTV's 
discrimination claim. The fact that MOJO will cease operations in the 
future is not relevant to the issue of whether the defendants engaged 
in unlawful discrimination during the period that WealthTV sought 
carriage. Our conclusion is consistent with the Commission's finding in 
other contexts that steps taken by a licensee following a violation do 
not eliminate the licensee's responsibility for the period during which 
the violation occurred. In addition, if carriage of WealthTV is 
ultimately required, the fact that the defendants will no longer be 
carrying MOJO on the relevant cable systems indicates that they will 
have a vacant channel on which to accommodate WealthTV.

A. WealthTV v. TWC

    4. After reviewing the pleadings and supporting documentation filed 
by the parties, we find that WealthTV has established a prima facie 
showing of discrimination under Section 76.1301(c). TWC is an MVPD and 
the second largest cable operator in the nation as measured by number 
of subscribers. TWC is affiliated with MOJO, a video programming 
vendor. According to TWC, MOJO's orientation is ``exclusively male'' 
and its principal programming consists of sports, movies,

[[Page 65313]]

music concerts, and reality series. On May 7, 2007, WealthTV provided 
TWC with a pre-filing notice pursuant to Section 76.1302(b) of the 
Commission's rules informing TWC of its intent to file a program 
carriage complaint. On December 20, 2007, WealthTV filed its complaint, 
alleging that TWC violated Section 76.1301(c) by refusing to carry 
WealthTV while granting carriage to its affiliated MOJO service.
1. Background
    5. WealthTV states that it has been seeking carriage on TWC systems 
since prior to its launch in June 2004. WealthTV explains that it 
proposed to provide its high definition (``HD'') video on demand 
(``VOD'') service to TWC free of charge provided that TWC grant it a 
``hunting license'' and commit to launch WealthTV in its linear line-up 
in one TWC system. TWC rejected this proposal because it was unwilling 
to commit to a linear launch on even one system. In December 2007, TWC 
offered a compromise whereby it agreed not to launch WealthTV's free HD 
VOD service until after it launched WealthTV in its linear line-up in 
one system. According to TWC, this proposal was meant to address 
WealthTV's concern that TWC could launch its free HD VOD service 
without ever launching WealthTV on a linear basis. WealthTV rejected 
this proposal because it still did not guarantee a linear launch in 
even one system. TWC contends that it offered WealthTV a hunting 
license that was similar to the deals it has offered to dozens of other 
programmers, including some of its affiliated programmers, and that 
WealthTV has accepted a hunting license from other MVPDs that have no 
ownership interest in MOJO, such as Charter. As WealthTV explains, 
however, its agreement with Charter guarantees a linear launch in a set 
number of systems, whereas TWC refused to commit to linear carriage in 
even one system. Moreover, WealthTV states that TWC has launched MOJO 
on a nationwide basis while it has offered WealthTV only a hunting 
license, thereby demonstrating TWC's discriminatory treatment. WealthTV 
also states that a hunting license with TWC is meaningless given the 
reluctance of TWC's corporate programming group to agree to carriage of 
WealthTV even if individual systems desire to carry the network. In its 
Motion to Strike, TWC states that, after the filing of the WealthTV 
complaint, it acceded to WealthTV's demands and proposed a hunting 
license coupled with a firm commitment for linear carriage of WealthTV 
on TWC's San Antonio system. In its Reply, WealthTV admits that 
discussions between TWC and WealthTV have continued after the filing of 
the Complaint, but states that it cannot address these discussions 
because the Commission's rules require a Reply to be responsive to 
matters contained in the Answer and not contain new matters.
2. Similarly Situated
    6. WealthTV has provided the following evidence that MOJO is 
``substantially similar to WealthTV'' with respect to programming, 
target demographic (affluent males aged 25 to 49), target audience, 
look and feel, targeted programming theme, and target advertisers.
    7. Similar programming. WealthTV provides examples of similar 
programming that both WealthTV and MOJO offer, regarding topics such as 
wine, automobiles, sports interviews, food, and electronics. For 
example, in June 2004, WealthTV launched Taste! The Beverage Show, 
which focuses on educating viewers about wine and spirits; in April 
2007, MOJO launched Uncorked, which focuses on the same subject matter. 
In June 2004, WealthTV launched Wealth on Wheels, which focuses on the 
latest trends in automotive technology; in August 2007, MOJO launched 
Test Drive, which focuses on the same subject matter. In June 2004, 
WealthTV launched Charlie Jones, Live to Tape, which features 
interviews of sports figures; MOJO shows Timeless, which also features 
interviews of sports figures. In June 2004, WealthTV launched Taste of 
Life, which educates viewers about behind the scenes experiences with 
travel, spirits, and food; in June 2006, MOJO launched After Hours, 
which focuses on a behind the scenes look at Los Angeles restaurants. 
In April 2005, WealthTV launched Innov8, which educates viewers about 
new ``gadgets and gizmos''; in December 2006, MOJO launched Geared Up, 
which focuses on high-end electronics and technology. WealthTV also 
provides an affidavit from Jedd Palmer, a consultant with more than 
twenty-five years of experience in the cable industry, who reviewed the 
programming schedules of MOJO and WealthTV and concludes that ``the 
overwhelming majority of the programming on both networks is the same, 
or very, very similar, in subject, type, feel, look and target 
audience.'' We conclude that the Palmer Declaration adequately set 
forth the basis for its conclusions.
    8. Similar target demographics. WealthTV provides evidence that 
WealthTV and MOJO both are focused on the same target demographic--
affluent males aged 25 to 49. WealthTV provides the results of a survey 
demonstrating that the demographics of WealthTV's viewers are affluent 
males aged 25 to 49. We find that the survey results set forth in the 
Kersey Declaration adequately set forth the basis for its conclusions. 
The results of the survey indicate that 71 percent of WealthTV's 
audience is male and 55 percent have incomes greater than $75,000. TWC 
provides similar results for MOJO--72 percent of its audience is male 
and 61 percent have incomes greater than $75,000. WealthTV also 
provides an excerpt from a 2004 presentation where WealthTV described 
its programming as geared towards males 25 to 49. WealthTV notes that 
the CEO of iN DEMAND has stated that MOJO is for ``men making more than 
$100,000 per year.'' MOJO has also used the term ``active affluents'' 
to describe its target audience. In his declaration, Jedd Palmer 
concludes that WealthTV targets the same audience as MOJO based on his 
review of marketing materials, press releases, and the networks' 
schedules and programming. Descriptions of WealthTV and MOJO's 
programming found on their respective Web sites further suggests the 
two networks offer similar programming.
    9. Similar focus on a targeted audience rather than on general 
entertainment. WealthTV explains that iN DEMAND announced the launch of 
MOJO in March 2007, almost three years after the launch of WealthTV. 
WealthTV notes that, upon the launch of MOJO, TWC agreed to offer the 
channel across all of its systems carrying HD. While TWC claims that 
the service now known as MOJO was originally launched in 2003 under the 
name INHD, before the launch of WealthTV, WealthTV provides evidence 
that MOJO did not result from merely a name change and that MOJO is a 
targeted programming service whereas INHD was a general entertainment 
service. WealthTV notes that the CEO of iN DEMAND stated that INHD 
could not survive as ``general entertainment programming,'' thus INHD 
was converted into a targeted programming service with similar 
programming to WealthTV. In his declaration, Jedd Palmer concludes that 
``MOJO is not a general entertainment service, but rather a highly 
targeted niche programming service.''
    10. Similar target advertisers. WealthTV explains that it targets 
the same advertisers as MOJO. WealthTV explains that both WealthTV and 
MOJO feature programming on wine and spirits and both networks have 
targeted the same advertising agency for Grey Goose Vodka.

[[Page 65314]]

    11. TWC disputes that WealthTV and MOJO are similar programming 
services or that they have similar target demographics. TWC appears to 
be arguing that a complainant must demonstrate that its programming is 
identical to an affiliated network in order to demonstrate 
discrimination. We find that this is a misreading of the program 
carriage statute and our rules.
3. Differential Treatment
    12. WealthTV argues that TWC has treated WealthTV differently than 
MOJO by carrying MOJO on its systems but refusing to carry WealthTV on 
those same systems. While TWC claims that it recently offered WealthTV 
a hunting license coupled with a firm commitment for linear carriage of 
WealthTV on TWC's San Antonio system, the salient issue for our 
analysis is that TWC has launched its affiliated MOJO network on a 
nationwide basis but it has refused to carry WealthTV on the same 
terms.
4. Harm to Ability to Compete
    13. As required by the program carriage statute and our rules, 
WealthTV has provided evidence that TWC's refusal to carry WealthTV 
restrains its ability to compete fairly. WealthTV provides evidence 
that advertisers are not interested in placing advertisements on 
programming services that are available to fewer than 20 million 
households. Absent carriage on one or both of the largest cable MSOs, 
such as TWC or Comcast, a programmer's ability to attract advertisers 
is impeded and its long-term financial viability is limited. In 
addition, WealthTV provides evidence that TWC has ``quasi monopolies'' 
in key markets, such as New York and Los Angeles, that are essential to 
WealthTV's long-term viability. WealthTV also notes that many MVPDs 
refuse to carry a programming service that has been denied carriage by 
TWC. WealthTV explains further that TWC's refusal to carry WealthTV has 
harmed WealthTV's ability to bargain with advertisers and other cable 
systems. TWC argues that WealthTV could meet a 20 million subscriber 
benchmark through carriage agreements with other large MVPDs, including 
MVPDs with no affiliation with MOJO, such as DIRECTV and DISH Network, 
but that WealthTV has failed to reach carriage agreements with these 
MVPDs as well. We reject this claim because it would effectively exempt 
all MVPDs from program carriage obligations based on the possibility of 
carriage on other MVPDs. Moreover, the program carriage provision of 
the Act prohibits an MVPD from discriminating against an unaffiliated 
programmer regardless of the competition the MVPD faces.
5. Alleged Business and Editorial Justifications for TWC's Refusal to 
Carry WealthTV
    14. TWC offers a number of alleged business and editorial 
justifications for its refusal to carry WealthTV but to carry MOJO. 
First, TWC claims that its minority stake in MOJO does not provide a 
sufficient basis to influence its decision regarding carriage of 
WealthTV. A determination whether the program carriage rules have been 
violated does not turn on whether or not TWC has a minority stake in 
the affiliated programmer, but rather it focuses on the factors we have 
identified above. Indeed, TWC admits that its interest in MOJO 
satisfies the attribution threshold, thus the program carriage rules 
apply to its conduct regarding carriage of MOJO.
    15. Second, TWC claims that the video marketplace is competitive 
and that no MVPD can afford to keep ``a programming service with 
attractive pricing and content off its systems based on ownership if 
doing so would cost it subscribers.'' We reject this claim because it 
would effectively require a program carriage complainant to demonstrate 
that an MVPD's failure to carry its service will cause subscribers to 
switch to other MVPDs that do carry the service. This is not a 
requirement of the program carriage statute or our rules. In addition, 
because TWC carries an affiliated programming service, MOJO, that 
provides programming that is substantially similar to WealthTV, there 
is even less reason for TWC's subscribers to switch to a competitor 
that carries WealthTV.
    16. Third, TWC states that its decision to carry a channel depends 
on capacity constraints; the proven track record of success of the 
channel; the experience of the channel's management team; the 
subscriber interest in the channel; input from TWC's division 
management; and the terms offered by the channel. TWC argues that 
WealthTV has no proven audience demand and is led by individuals with 
no experience in creating a national cable network. WealthTV, on its 
behalf, has provided evidence demonstrating that it is an established 
channel with experienced management and proven consumer appeal, as 
demonstrated by: (i) Its linear carriage on 75 MVPDs to date; (ii) a 
sampling of e-mails from viewers reflecting their support for the 
channel; (iii) the interest in the channel expressed by representatives 
of individual TWC systems; and (iv) the decision of TWC's San Antonio 
system to launch WealthTV's HD VOD service in March 2007.
    17. Fourth, TWC states that it made the same business decision as 
many other MVPDs, including Direct Broadcast Satellite (``DBS'') 
operators DIRECTV and DISH Network, that WealthTV did not warrant 
carriage given the terms it was demanding. WealthTV explains, however, 
that the decision of DBS operators to refrain from carrying WealthTV is 
irrelevant because they do not carry MOJO either.
6. Conclusion
    18. We conclude that WealthTV has established a prima facie showing 
that TWC has discriminated against WealthTV in violation of the program 
carriage rules.

B. WealthTV v. BHN

    19. After reviewing the pleadings and supporting documentation 
filed by the parties, we find that WealthTV has established prima facie 
showing of discrimination under Section 76.1301(c). BHN is an MVPD and 
the sixth largest cable operator in the nation as measured by number of 
subscribers. BHN is affiliated with MOJO, a video programming vendor. 
According to BHN, MOJO's orientation is ``exclusively male'' and is 
principal programming consists of sports, movies, music concerts, and 
reality series. On May 15, 2007, WealthTV provided BHN with a pre-
filing notice pursuant to Section 76.1302(b) of the Commission's rules 
informing BHN of its intent to file a program carriage complaint. As 
discussed further below, on March 13, 2008, WealthTV filed its 
complaint, alleging that BHN violated Section 76.1301(c) by refusing to 
carry WealthTV while granting carriage to its affiliated MOJO service.
1. Background
    20. WealthTV states that it has been seeking carriage on BHN 
systems since the summer of 2004. WealthTV describes its visits with 
BHN representatives in leading markets and claims that representatives 
of several BHN systems, including those in the Tampa Bay market, 
expressed an interest in carrying WealthTV, especially because Verizon 
FIOS TV offered WealthTV in both standard digital and HD formats in 
Tampa Bay. WealthTV claims that Anne Stith, formerly BHN's Director of 
Product Marketing for the Tampa Division, told WealthTV's President in 
July 2006 that BHN would like to launch WealthTV as soon as WealthTV 
completed a deal with TWC. WealthTV also notes that it

[[Page 65315]]

was making its service available for free through 2008. BHN and Ms. 
Stith, however, state that Ms. Stith had no authority to make 
programming commitments on behalf of BHN and that most programmers 
understood that BHN was covered by the programming agreements 
negotiated by TWC. Moreover, Ms. Stith states that her inquiries of 
WealthTV were purely for purposes of research and that she never made 
statements indicating that BHN would be interested in carrying 
WealthTV. When WealthTV's Vice President of Affiliate Relations, John 
Scaro, contacted BHN's President, Steve Miron, Mr. Miron informed Mr. 
Scaro that BHN is covered by the programming agreements that TWC 
negotiates with national networks and that further direct negotiations 
with BHN would not be an efficient use of time. Based on this, WealthTV 
concludes that BHN was prepared to carry WealthTV but for the absence 
of a carriage agreement with TWC. WealthTV states that BHN thus 
completely refused to negotiate with WealthTV. WealthTV states the BHN 
is required to comply with the program carriage rules and cannot use 
its reliance on TWC to negotiate programming agreements as a defense.
2. Similarly Situated
    21. WealthTV provides similar evidence submitted in connection with 
its complaint against TWC purporting to demonstrate that WealthTV and 
MOJO are similarly situated. BHN notes some general dissimilarities 
between specific programming on WealthTV and MOJO. BHN appears to be 
arguing that a complainant must demonstrate that its programming is 
identical to an affiliated network in order to demonstrate 
discrimination. We find that this is a misreading of the program 
carriage statute and our rules.
3. Differential Treatment
    22. WealthTV argues that BHN has treated WealthTV differently by 
carrying MOJO on its systems but refusing to carry WealthTV on those 
same systems.
4. Harm to Ability To Compete
    23. As required by the program carriage statute and our rules, 
WealthTV has provided evidence that BHN's refusal to carry WealthTV 
restrains its ability to compete fairly. WealthTV notes that BHN's 
decision to carry MOJO but to deny carriage to WealthTV provides MOJO 
with a first mover advantage with respect to the viewers and 
advertisers each network targets. WealthTV also explains that an 
independent channel must be available to at least 20 million 
subscribers in order to attract national advertisers and to achieve 
financial viability. WealthTV states that the inability to obtain 
carriage on BHN systems makes it more difficult for independent 
programmers to reach this level of subscribership. WealthTV also 
alleges that obtaining carriage in major markets where BHN owns cable 
systems, such as Tampa and Orlando, is essential for attracting 
advertisers. According to WealthTV, many MVPDs refuse to carry a 
programming service that has been denied carriage by TWC and BHN. In 
addition, WealthTV states that BHN's refusal to carry WealthTV has 
harmed WealthTV's ability to bargain with advertisers and other cable 
systems.
    24. In response, BHN argues that carriage on its systems is not 
necessary in order to reach the 20 million subscriber benchmark. The 
program carriage rules, however, apply to all MVPDs, regardless of 
their subscriber base. BHN claims that WealthTV could meet this 
benchmark through carriage agreements with other MVPDs, including MVPDs 
with no affiliation with MOJO, such as DIRECTV and DISH Network, but 
that WealthTV has failed to reach carriage agreements with these MVPDs 
as well. We reject this claim because it would effectively exempt all 
MVPDs from program carriage obligations based on the possibility of 
carriage on other MVPDs. Moreover, the program carriage provision of 
the Act prohibits an MVPD from discriminating against an unaffiliated 
programmer regardless of the competition the MVPD faces. While BHN 
asserts that the 20 million subscriber benchmark cannot apply to an HD 
network such as WealthTV because there are fewer than 20 million HD 
customers nationwide, WealthTV responds that its HD feed is also 
available as a downconverted standard definition (``SD'') feed that can 
be viewed by all subscribers. While BHN notes that WealthTV has been 
operational for four years despite the lack of a carriage agreement 
with BHN, we agree with WealthTV that the more pertinent consideration 
is its ability to compete over the long term absent a carriage 
agreement with BHN.
5. Alleged Business and Editorial Justifications for BHN's Refusal To 
Carry WealthTV
    25. BHN offers a number of alleged business and editorial 
justifications for its refusal to carry WealthTV but to carry MOJO. 
First, BHN claims that its five percent economic interest in MOJO does 
not provide a sufficient basis to influence its decision regarding 
carriage of WealthTV. BHN admits, however, that its interest in MOJO 
satisfies the attribution threshold, thus the program carriage rules 
apply to its conduct regarding carriage of MOJO.
    26. Second, BHN claims that the video marketplace is competitive 
and that ``customers will take their business elsewhere if BHN fails to 
offer them desirable services at a fair price.'' We reject this claim 
because it would effectively require a program carriage complainant to 
demonstrate that an MVPD's failure to carry the service will cause 
subscribers to switch to other MVPDs that do carry the service. In 
addition, because BHN carries its affiliated programming service, MOJO, 
that provides programming that is substantially similar to WealthTV, 
there is even less reason for BHN's subscribers to switch to a 
competitor that carries WealthTV.
    27. Third, BHN claims that its negotiations reflect ``sound 
business and editorial judgment.'' Specifically, BHN states that its 
decision to carry a channel depends on capacity constraints; whether 
the channel is carried by competitors; the experience of the channel's 
management team; the overall product mix of the BHN system; subscriber 
demand for the channel; input from BHN's division management; and the 
terms offered by the channel. BHN contends that WealthTV has no proven 
consumer demand and is managed by individuals with no experience in 
launching successful networks. WealthTV, for its part, has provided 
evidence demonstrating that it is an established channel with 
experienced management and proven consumer appeal, as demonstrated by: 
(i) Its linear carriage on 75 MVPDs to date; (ii) a sampling of e-mails 
from viewers reflecting their support for the channel; and (iii) the 
interest in the channel expressed by representatives of individual BHN 
systems. WealthTV also provides the results of an independent survey 
which reports that WealthTV's HD VOD product ranked fourth out of 
twenty HD services.
    28. Fourth, BHN contends that virtually all of the MVPDs that do 
not carry WealthTV are not affiliated with MOJO, again demonstrating 
that decisions regarding carriage of WealthTV are not based on 
affiliation. For example, BHN notes that DBS operators, DIRECTV and 
DISH Network, do not carry WealthTV. WealthTV explains that the 
decision of DBS operators to refrain from carrying WealthTV is 
irrelevant because they do not carry MOJO either. Moreover, WealthTV 
notes that Verizon, BHN's wireline competitor in Tampa, carries 
WealthTV but not MOJO. In any event,

[[Page 65316]]

we agree with WealthTV that the salient fact is that each owner of the 
cable-affiliated MOJO network has refused to carry WealthTV, and a 
discrimination claim requires the Commission to assess why these cable 
operators have refused to carry WealthTV but have decided to carry 
MOJO.
6. Conclusion
    29. We conclude that WealthTV has established a prima facie that 
BHN has discriminated against WealthTV in violation of the program 
carriage rules.

C. WealthTV v. Cox

    30. After reviewing the pleadings and supporting documentation 
filed by the parties, we find that WealthTV established a prima facie 
showing of discrimination under Section 76.1301(c). Cox is an MVPD and 
the third largest cable operator in the nation. Cox is affiliated with 
MOJO, a video programming vendor. According to Cox, MOJO's orientation 
is ``exclusively male'' and its principal programming consists of 
sports, movies, music concerts, and reality series. On May 7, 2007, 
WealthTV provided Cox with a pre-filing notice pursuant to Section 
76.1302(b) of the Commission's rules informing Cox of its intent to 
file a program carriage complaint. As discussed further below, on March 
27, 2008, WealthTV filed its complaint, alleging that Cox violated 
Section 76.1301(c) by refusing to carry WealthTV while granting 
carriage to its affiliated MOJO service.
1. Background
    31. WealthTV states that it has been seeking carriage on Cox 
systems since the summer of 2004, but that Cox has refused to negotiate 
in good faith. WealthTV discusses its visits with representatives of 
individual Cox systems in leading markets during 2004 and 2005 and 
claims that some of these systems expressed a strong desire to carry 
WealthTV. Cox states that its programming negotiations are conducted at 
the corporate level and provides declarations from representatives of 
individual Cox systems stating that they informed WealthTV that all 
carriage decisions are made by Cox's corporate programming department. 
Cox states that it informed WealthTV at a May 2005 meeting that the 
interest expressed by a few individual systems was insufficient to 
justify carriage of WealthTV and that it was denying carriage to 
WealthTV. WealthTV states that it considered Cox's comments to be a 
form of bargaining and that Cox did not state that a final decision had 
been made to deny carriage to WealthTV.
2. Procedural Issues
    32. Cox contends that the WealthTV complaint is barred by the 
program carriage statute of limitations because the complaint does not 
allege any act by Cox occurring within one year of the Complaint or the 
pre-filing notice. Rather, according to Cox, the last formal contact 
between WealthTV and Cox alleged in the complaint occurred no later 
than a June 7, 2005 letter; thus, Cox claims that the statute of 
limitations required WealthTV to file its complaint no later than June 
7, 2006. We reject Cox's claim for the following reasons. First, 
WealthTV states that Cox never expressed a final decision to deny 
carriage to WealthTV and provides evidence that communications between 
Cox and WealthTV continued after June 2005. To further support its 
claim that the Complaint was filed in accordance with the statute of 
limitations, WealthTV explains that it was not until May 2006, one year 
prior to the pre-filing notice, when Cox refused to carry the multicast 
stream of a Las Vegas CBS affiliate that proposed to broadcast WealthTV 
programming. Cox argues, however, that this incident did not involve 
direct communication between Cox and WealthTV. WealthTV, however, 
claims that Leo Brennan of Cox-Las Vegas informed WealthTV of this 
decision in mid-May 2006. Second, WealthTV states that it was not until 
the launch of MOJO in March 2007 and the failure of subsequent carriage 
discussions when it became obvious to WealthTV that Cox intended to 
favor its affiliated MOJO service. Third, the plain language of the 
Commission's rules provides that the statute of limitations is 
satisfied if the program carriage complaint is filed within one year of 
the pre-filing notice, which WealthTV has done in this case.
3. Similarly Situated
    33. WealthTV provides similar evidence submitted in connection with 
its complaint against TWC purporting to demonstrate that WealthTV and 
MOJO are similarly situated. Cox notes some general dissimilarities 
between specific programming on WealthTV and MOJO. Cox appears to be 
arguing that a complainant must demonstrate that its programming is 
identical to an affiliated network in order to demonstrate 
discrimination. We find that this is a misreading of the program 
carriage statute and our rules.
4. Differential Treatment
    34. WealthTV argues that Cox has treated WealthTV differently by 
carrying MOJO on its systems but refusing to carry WealthTV on those 
same systems.
5. Harm to Ability To Compete
    35. As required by the program carriage statute and our rules, 
WealthTV has provided evidence that Cox's refusal to carry WealthTV 
restrains its ability to compete fairly. WealthTV explains that Cox's 
decision to carry MOJO but to deny carriage to WealthTV provides MOJO 
with a first mover advantage with respect to the viewers and 
advertisers each network targets. WealthTV also submits that an 
independent channel must be available to at least 20 million 
subscribers in order to attract national advertisers and to achieve 
financial viability. WealthTV states that the inability to obtain 
carriage on Cox systems makes it more difficult for independent 
programmers to reach this level of subscribership. In addition, 
WealthTV explains that obtaining carriage in major markets where Cox 
owns or operates systems, such as Central Florida, New England, 
Phoenix, and San Diego, is essential for attracting advertisers. 
According to WealthTV, many MVPDs refuse to carry a programming service 
that has been denied carriage by Cox. In addition, Cox's refusal to 
carry WealthTV has harmed WealthTV's ability to bargain with 
advertisers and other cable systems.
    36. In response, Cox does not dispute that 20 million subscribers 
are needed for a channel to achieve long-term viability, but states 
that it serves approximately six million MVPD households, thereby 
making carriage on its systems not necessary in order to reach the 20 
million subscriber benchmark. The program carriage rules, however, 
apply to all MVPDs, regardless of their subscriber base. Cox also 
claims that WealthTV could meet this benchmark through carriage 
agreements with other MVPDs, including MVPDs with no affiliation with 
MOJO, such as DIRECTV and DISH Network, but that WealthTV has failed to 
reach carriage agreements with these MVPDs as well. We reject this 
claim because it would effectively exempt all MVPDs from program 
carriage obligations based on the possibility of carriage on other 
MVPDs. Moreover, the program carriage provision of the Act prohibits an 
MVPD from discriminating against an unaffiliated programmer regardless 
of the competition the MVPD faces. Cox also asserts that the 20 million 
subscriber benchmark cannot apply to

[[Page 65317]]

an HD network such as WealthTV because there are fewer than 20 million 
HD customers nationwide. WealthTV explains, however, that its HD feed 
is also available as a downconverted SD feed that can be viewed by all 
subscribers. While Cox notes that WealthTV has obtained carriage on a 
number of MVPDs despite the lack of a carriage agreement with Cox, we 
agree with WealthTV that the more pertinent consideration is its 
ability to compete over the long term absent a carriage agreement with 
Cox.
6. Alleged Business and Editorial Justifications for Cox's Refusal To 
Carry WealthTV
    37. Cox offers a number of alleged business and editorial 
justifications for its refusal to carry WealthTV but to carry MOJO. 
First, Cox claims that its minority interest in MOJO does not provide a 
sufficient basis for Cox to decline to carry WealthTV. Cox admits, 
however, that its interest in MOJO satisfies the attribution threshold, 
thus the program carriage rules apply to its conduct regarding carriage 
of MOJO.
    38. Second, Cox claims that it declined to carry WealthTV based on 
``sound business considerations and reasonable editorial judgment.'' 
Specifically, Cox states that its decision to carry a channel depends 
on the following criteria: Likely viewer appeal; the quality of the 
programming; whether the channel has a proven track record of 
attracting viewers or is associated with an established brand; the 
likelihood of the channel's success considering its management team and 
business plan; bandwidth management; proposed terms of carriage; the 
local needs of Cox's cable systems; and whether the channel has a 
regional appeal that might be attractive to certain systems. Cox claims 
that WealthTV does not justify carriage based on these criteria. 
WealthTV argues that it satisfies Cox's selection criteria. For 
example, WealthTV asserts that it is an established channel with 
experienced management; offered very favorable terms for carriage; and 
that Cox's alleged concern regarding bandwidth constraints from 
carrying an HD channel are not a valid concern because WealthTV was 
offering SD digital and VOD products in addition to HD. WealthTV also 
provides evidence that it has proven viewer appeal, as demonstrated by: 
(i) Its linear carriage on 75 MVPDs to date; (ii) a sampling of e-mails 
from viewers reflecting their support for the channel; (iii) the 
interest in the channel expressed by representatives of various Cox 
systems; (iv) the interest expressed by Cox-San Diego and a Cox 
programming network in San Diego (4SD--High Definition) in carrying 
WealthTV-produced content; and (v) the interest expressed by a CBS 
affiliate in Las Vegas in carrying WealthTV as a multicast channel, 
which the General Manager of Cox-Las Vegas refused to carry because of 
the potential for negative customer reaction if the CBS affiliate were 
to drop the WealthTV programming.
    39. Third, Cox contends that most of the MVPDs that do not carry 
WealthTV are not affiliated with MOJO, thus demonstrating that 
decisions to refrain from carrying WealthTV are not based on 
affiliation. For example, Cox notes that DBS operators, DIRECTV and 
DISH Network, do not carry WealthTV. WealthTV explains, however, that 
the decision of DBS operators to refrain from carrying WealthTV is 
irrelevant because they do not carry MOJO either. In any event, we 
agree with WealthTV that the salient fact is that each owner of the 
cable-affiliated MOJO network has refused to carry WealthTV, and a 
discrimination claim requires the Commission to assess why these cable 
operators have decided to refuse carriage to WealthTV.
7. Conclusion
    40. We conclude that WealthTV has established a prima facie showing 
that Cox has discriminated against WealthTV in violation of the program 
carriage rules.

D. WealthTV v. Comcast

    41. After reviewing the pleadings and supporting documentation 
filed by the parties, we find that WealthTV has established a prima 
facie showing of discrimination under Section 76.1301(c). Comcast is an 
MVPD and the largest cable operator in the nation as measured by number 
of subscribers. Comcast serves over 24 million basic video subscribers 
in 39 states and the District of Columbia. Comcast is affiliated with 
MOJO, a video programming vendor. According to Comcast, MOJO is aimed 
at 18- to-49-year-old males and its principal programming consists of 
sports, movies, and concerts. On May 3, 2007, WealthTV provided Comcast 
with a pre-filing notice pursuant to Section 76.1302(b) of the 
Commission's rules informing Comcast of its intent to file a program 
carriage complaint. As discussed further below, on April 21, 2008, 
WealthTV filed its complaint, alleging that Comcast violated Section 
76.1301(c) by refusing to carry WealthTV while granting carriage to its 
affiliated MOJO service.
1. Background
    42. WealthTV states that it has been seeking carriage on Comcast 
systems since early to mid-2004. WealthTV discusses its visits with 
Comcast representatives in leading markets and claims that systems in 
Comcast's Atlantic Division, San Francisco, Washington DC/Virginia, 
Chicago, Washington state, and Florida all expressed interest in 
carrying WealthTV. According to WealthTV, in the summer of 2004, 
Comcast's corporate programming group acknowledged the interest among 
Comcast systems in carrying WealthTV but Comcast refused to engage in 
meaningful negotiations. WealthTV alleges that Alan Dannenbaum, 
Comcast's Corporate Senior Vice President of Programming, stated in the 
second half of 2004 that a draft carriage agreement would be 
forthcoming but blamed ``scarce resources'' for the failure to produce 
a draft. Comcast states that neither its corporate management nor any 
individual Comcast system expressed an interest in carrying WealthTV.
    43. In August 2006, WealthTV representatives, including WealthTV's 
President, Charles Herring, met with Mr. Dannenbaum. According to 
WealthTV, Mr. Dannenbaum stated that ``Comcast will not allow another 
MTV to be made on Comcast's back without owning it.'' WealthTV states 
that it understood this to mean that Comcast would not allow a non-
affiliated network to become successful without owning it. WealthTV 
states that this is direct evidence of discrimination in Comcast's 
carriage decisions. Comcast provides a declaration from Mr. Dannenbaum 
in which he denies making this statement.
    44. Comcast states that it made two offers to carry WealthTV in 
April 2008, after WealthTV sent its pre-filing notice but prior to the 
filing of the Complaint. WealthTV counters that Comcast never made a 
firm offer for carriage during these discussions and that none of the 
proposals was remotely comparable to the terms and conditions offered 
to MOJO.
2. Similarly Situated
    45. WealthTV provides similar evidence submitted in connection with 
its complaint against TWC purporting to demonstrate that WealthTV and 
MOJO are similarly situated. Comcast notes some general dissimilarities 
between specific programming on WealthTV and MOJO. Comcast appears to 
be arguing that a complainant must demonstrate that its programming is 
identical to an affiliated network in order to

[[Page 65318]]

demonstrate discrimination. We find that this is a misreading of the 
program carriage statute and our rules.
3. Differential Treatment
    46. WealthTV argues that Comcast has treated WealthTV differently 
by carrying MOJO on its systems but refusing to carry WealthTV on those 
same systems. While Comcast claims that it recently offered WealthTV a 
hunting license coupled with a firm commitment for linear carriage of 
WealthTV on a system in the Chicago DMA, the salient issue for our 
analysis is that Comcast has launched its affiliated MOJO network on a 
nationwide basis but it has refused to carry WealthTV on the same 
terms.
4. Harm to Ability To Compete
    47. As required by the program carriage statute and our rules, 
WealthTV has provided evidence that Comcast's refusal to carry WealthTV 
restrains its ability to compete fairly. WealthTV explains that 
Comcast's decision to carry MOJO while denying carriage to WealthTV 
provides MOJO with a first mover advantage with respect to the viewers 
and advertisers each network targets. WealthTV also claims that an 
independent channel must be available to at least 20 million 
subscribers in order to attract national advertisers and to achieve 
financial viability. WealthTV states that the inability to obtain 
carriage on Comcast systems makes it more difficult for independent 
programmers to reach this level of subscribership. WealthTV also 
explains that obtaining carriage in major markets where Comcast owns or 
operates cable systems, such as Philadelphia, Chicago, San Francisco, 
Boston, Washington, and Houston, is essential for attracting 
advertisers. According to WealthTV, cable systems and satellite 
companies look to Comcast in making programming decisions, thereby 
making Comcast's refusal to carry WealthTV particularly harmful. In 
addition, Comcast's refusal to carry WealthTV has harmed WealthTV's 
ability to bargain with advertisers and other cable systems.
    48. In response, Comcast claims that carriage on its competitors, 
such as DIRECTV, DISH Network, AT&T, and Verizon, would allow WealthTV 
to reach its subscriber goals. We reject this claim because it would 
effectively exempt all MVPDs from program carriage obligations based on 
the possibility of carriage on other MVPDs. Moreover, the program 
carriage provision of the Act prohibits an MVPD from discriminating 
against an unaffiliated programmer regardless of the competition the 
MVPD faces. Comcast also states that WealthTV could distribute its 
programming on alternative distribution platforms, such as VOD or the 
Internet. The program carriage statute, however, does not excuse an 
MVPD's discriminatory conduct based on the possibility of alternative 
distribution platforms.
5. Alleged Business and Editorial Justifications for Comcast's Refusal 
To Carry WealthTV
    49. Comcast offers a number of alleged business and editorial 
justifications for its refusal to carry WealthTV but to carry MOJO. 
First, Comcast states that it declined to carry WealthTV on terms 
similar to MOJO based on its business and editorial judgment. 
Specifically, Comcast states that its decision to carry a channel 
depends on capacity constraints; the type and quality of the 
programming; the channel's track record of producing programming; 
evidence of consumer appeal for the channel; the experience of the 
channel's management team; and the terms offered by the channel. Based 
on these factors, Comcast contends that it determined that WealthTV 
does not warrant extensive carriage. WealthTV argues that it meets 
Comcast's carriage criteria, explaining that it is an established 
channel with experienced management and proven consumer appeal, as 
demonstrated by: (i) Its linear carriage on 75 MVPDs to date; (ii) a 
sampling of e-mails from viewers reflecting their support for the 
channel; (iii) the interest in the channel expressed by representatives 
of various Comcast systems as well as favorable comments about WealthTV 
made by Madison Bond, Comcast's Executive Vice President for Content 
Acquisition; and (iv) the results of an independent survey which 
reports that WealthTV's HD VOD product ranked fourth out of twenty HD 
services. WealthTV also notes that it offered very favorable terms for 
carriage.
    50. Second, Comcast contends that most MVPDs do not carry WealthTV, 
including those that have no affiliation with MOJO, again demonstrating 
that decisions regarding carriage of WealthTV are not based on 
affiliation. For example, Comcast notes that DBS operators, DIRECTV and 
DISH Network, do not carry WealthTV. WealthTV explains, however, that 
the decision of DBS operators to refrain from carrying WealthTV is 
irrelevant because they do not carry MOJO either. Moreover, WealthTV 
notes that AT&T, Verizon, and other Comcast competitors carry WealthTV 
but not MOJO.
6. Conclusion
    51. We conclude that WealthTV has established a prima facie showing 
that Comcast has discriminated against WealthTV in violation of the 
program carriage rules.

E. Conclusion

    52. In the Second Report and Order, the Commission stated that it 
would identify specific behavior that constitutes discrimination on a 
case-by-case basis ``because the practices at issue will necessarily 
involve behavior that must be evaluated within the context of specific 
facts pertaining to each negotiation.'' Second Report and Order, 58 FR 
60390, November 16, 1993. Any complainant alleging a violation of the 
prohibition in Section 616(a)(3) on discrimination must demonstrate 
that the alleged discrimination is ``on the basis of affiliation or 
nonaffiliation'' of a vendor, and that ``the effect of the conduct that 
prompts the complaint is to unreasonably restrain the ability of the 
complainant to compete fairly.'' Id.; 47 CFR 76.1302(c)(3). After 
reviewing the pleadings and supporting documentation filed by the 
parties, we find that WealthTV has established a prima facie case in 
the above-referenced cases under Section 76.1301(c). We also find that 
the pleadings and supporting documentation present several factual 
disputes as to whether TWC, BHN, Cox, and Comcast discriminated against 
WealthTV in favor of their affiliated MOJO service. Accordingly, we 
direct the ALJ to make and return a Recommended Decision to the 
Commission pursuant to the procedures set forth below within 60 days 
after release of this Order (i.e., by December 9, 2008).

II. NFL Enterprises v. Comcast

    53. After reviewing the pleadings and supporting documentation 
filed by the parties, we find that the NFL has established a prima 
facie case that Comcast (i) discriminated against the NFL Network in 
violation of Section 76.1301(c) of our rules; and (ii) required a 
financial interest in the NFL's programming as a condition for carriage 
of the NFL Network, in violation of Section 76.1301(a) of the 
Commission's rules. The NFL owns the NFL Network, a video programming 
vendor as defined in Section 616(b) of the Act and Section 76.1300(e) 
of the Commission's rules. See 47 U.S.C. 536(b); 47 CFR 76.1300(e). The 
NFL Network was launched in 2003 as a fan development vehicle to offer 
football-related programming. In addition to offering eight live NFL 
regular season games, the NFL Network

[[Page 65319]]

offers pre-season live and tape-delayed games as well as coverage of 
the NFL Scouting Combine, the NFL Draft, team training camps, and other 
programming. The NFL states that the NFL Network is an independent 
network that is not owned by any cable or satellite operator. The NFL 
Network is currently carried by over 240 MVPDs to 36 million 
subscribers nationwide. Comcast is the largest MVPD in the nation, with 
approximately 24.7 million subscribers. Comcast is affiliated with 
Versus (previously named the Outdoor Life Network (``OLN'')), the Golf 
Channel, as well as other video programming vendors.

A. Background

    54. On April 17, 2008, the NFL provided Comcast with a pre-filing 
notice pursuant to Section 76.1302(b) of the Commission's rules 
informing Comcast of its intent to file a program carriage complaint. 
As discussed further below, on May 6, 2008, the NFL filed its 
complaint, alleging that Comcast (i) discriminated against the NFL 
Network in favor of its affiliated video programming vendors, including 
Versus and the Golf Channel, in violation of Section 76.1301(c) of the 
Commission's rules; and (ii) required a financial interest in the NFL's 
programming as a condition for carriage of the NFL Network, in 
violation of Section 76.1301(a) of the Commission's rules. In its 
Complaint, the NFL requests the Commission to (i) Find Comcast in 
violation of Sections 76.1301(a) and (c) of the Commission's rules; 
(ii) enjoin Comcast from further program carriage discrimination; (iii) 
order Comcast to carry the NFL Network on equitable terms that do not 
unreasonably restrict its ability to compete fairly, as determined by 
the Media Bureau; and (iv) order any other relief that may be 
appropriate. In its Reply, the NFL specifies further that the 
Commission should require Comcast to carry the NFL Network on the same 
tier as its affiliated national sports networks, Versus and the Golf 
Channel, beginning with the commencement of the fall 2008 football 
season. The NFL also contends that an extensive evidentiary 
investigation is not needed and that the Commission should promptly 
enter an Order providing its requested relief.
    55. According to Comcast, the NFL approached Comcast regarding 
carriage of the NFL Network in 2003. Comcast claims that it was not 
interested in carrying the NFL Network because consumer interest in a 
football-only network without any live NFL games appeared weak; Comcast 
had bandwidth constraints; and Comcast was concerned about the soaring 
costs of sports programming. Comcast claims that around the time the 
NFL was seeking carriage for the NFL Network, it was also seeking to 
make available to MVPDs its NFL Sunday Ticket package and a package of 
eight live NFL regular season games (the ``Eight-Game Package''). 
Comcast states that it was interested in acquiring the rights to 
telecast the NFL Sunday Ticket because it had lost subscribers to 
DIRECTV which had exclusive rights to NFL Sunday Ticket. Comcast states 
that it was also interested in licensing the Eight-Game Package for its 
Versus network. According to Comcast, the NFL sought to make carriage 
of the NFL Network more attractive by coupling carriage of the NFL 
Network on a widely distributed tier with an opportunity for Comcast to 
bid on NFL Sunday Ticket and the Eight-Game Package. Comcast was 
concerned, however, that it might be forced to carry the NFL Network on 
a widely distributed tier even if it did not acquire the licensing 
rights to NFL Sunday Ticket and the Eight-Game Package.
    56. In August 2004, the NFL and Comcast entered into a Negotiating 
Agreement regarding the NFL Sunday Ticket and the Eight-Game Package 
and an Affiliation Agreement regarding carriage of the NFL Network. In 
the Affiliation Agreement, Comcast agreed to carry the NFL Network on 
its digital basic tier (called the ``D2'' tier). The Affiliation 
Agreement provided that, with one exception, no Comcast system could 
distribute the NFL Network solely in a sports tier. The exception 
provided that Comcast would have the right to move the NFL Network from 
the digital basic tier to any tier (including a premium sports tier) if 
Comcast and the NFL did not reach an agreement by July 31, 2006 
concerning carriage of the NFL Sunday Ticket or the Eight-Game Package 
(the ``Conditional Tiering Provision''). The NFL alleges that Comcast 
``forced'' it to agree to the Conditional Tiering Provision. Comcast 
states that this provision was meant to address its concern that it 
might be forced to carry the NFL Network on a widely distributed tier 
even if it did not acquire the licensing rights to NFL Sunday Ticket or 
the Eight-Game Package. Comcast claims that the Conditional Tiering 
Provision was a fundamental part of the parties' agreement and that it 
would not have agreed to carry the NFL Network without this provision. 
Pursuant to this Affiliation Agreement, Comcast began to carry the NFL 
Network on its digital basic tier in 2004. According to the NFL, from 
2004 until the summer of 2007, approximately 8.6 million Comcast 
customers received the NFL Network on the digital basic tier.
    57. In November 2004, the NFL renewed its exclusive contract with 
DIRECTV for the NFL Sunday Ticket through 2010, but Comcast and the NFL 
continued negotiations regarding the Eight-Game Package. During the 
negotiations regarding the Eight-Game Package, Comcast claims that it 
reminded the NFL on more than one occasion that the Conditional Tiering 
Provision would provide Comcast with the right to move the NFL Network 
to a sports tier if Comcast did not obtain the rights to the Eight-Game 
Package for its Versus network.
    58. On January 24, 2006, Comcast's Chief Executive Officer Brian 
Roberts met with then-NFL Commissioner Paul Tagliabue and others from 
the NFL. The NFL states that Mr. Tagliabue told Mr. Roberts that the 
NFL's then-current thinking was that it would not license the Eight-
Game Package to Comcast. According to the NFL, Mr. Roberts ``threatened 
that if the NFL did not license the package to Versus, Comcast would 
drop the NFL Network from the 'D2' tier and shift it to an undesirable 
premium sports tier * * *.'' According to Comcast, Mr. Roberts was 
simply reminding the NFL of Comcast's rights under the Conditional 
Tiering Provision. Following this meeting, the NFL awarded the Eight-
Game Package to the NFL Network.
    59. According to the NFL, on January 27, 2006, Mr. Roberts 
``warned'' Mr. Tagliabue that, because of the NFL's failure to license 
the Eight-Game Package to Comcast, the NFL's ``relationships with the 
cable industry are going to get very interesting.'' Mr. Tagliabue 
states that he believes that this statement foreshadowed Comcast's 
retaliation against the NFL for refusing to license the Eight-Game 
Package to Comcast. Mr. Roberts states that he has no recollection of 
making this statement. Rather, Mr. Roberts states that he expressed his 
disappointment about the NFL's decision and said that he foresaw that 
the NFL would continue to face difficulties persuading cable operators 
to provide the NFL Network with broad distribution given that the 
Eight-Game Package would add significantly to the price of the network 
but would not improve the overall appeal of the content.
    60. Pursuant to the Affiliation Agreement, Comcast would have the 
right to show the Eight-Game Package on the NFL Network on its cable 
systems only if Comcast agreed to an increase in the license fee for 
the NFL

[[Page 65320]]

Network of up to $0.55 per subscriber per month. If Comcast did not 
agree to pay this increase in the license fee, then the NFL Network 
would show alternate programming on Comcast's systems at the times 
these games would be shown. On July 27, 2006, Comcast agreed to the fee 
increase. Comcast claims that it agreed to this fee increase only after 
confirming with the NFL that the Conditional Tiering Provision was 
mutually understood to remain in effect.
    61. On September 24, 2006, Comcast announced its plans to launch 
the NFL Network on a premium sports tier on systems it had acquired 
from Time Warner. In October 2006, the NFL sued Comcast in New York 
state court claiming that Comcast did not have the right under the 
parties' agreements to carry the NFL Network on a premium sports tier. 
In the NFL's view, the Conditional Tiering Provision in the Affiliation 
Agreement was not triggered because Comcast and the NFL reached an 
agreement concerning carriage of the Eight-Game Package when Comcast 
agreed to pay an additional $0.55 per subscriber per month to deliver 
the NFL Network's broadcast of the Eight-Game Package via Comcast's 
cable systems. In Comcast's view, Comcast and the NFL did not reach an 
agreement concerning carriage of the Eight-Game Package because the 
games were awarded to the NFL Network and not to Comcast's affiliated 
Versus network. In May 2007, the trial court granted Comcast's motion 
for summary judgment. Following release of the trial court's order, 
Comcast formally notified the NFL of its intent to shift NFL Network to 
a sports tier in most of its systems. The NFL states that Comcast's 
action to shift the NFL Network from a digital basic tier to a premium 
sports tier reduced the number of Comcast subscribers that received the 
NFL Network from 8.6 million to 1.4 million. On February 26, 2008, a 
New York appellate court reversed the lower court's ruling and found 
that the parties' agreement was sufficiently ambiguous to create a 
triable issue of fact. In May 2008, the parties agreed to pursue non-
binding mediation at the request of the court.

B. Procedural Issues

    62. Comcast argues that the NFL complaint should be dismissed on 
any of the following procedural grounds. For the reasons discussed 
below, we decline to dismiss the complaint on any of these grounds.
1. Program Carriage Statute of Limitations
    63. Comcast argues that the NFL complaint is barred by the program 
carriage statute of limitations. Comcast contends that, of the events 
that trigger the running of the program carriage statute of 
limitations, only the date on which the parties entered into a carriage 
agreement for the NFL Network is applicable in this case. Comcast 
states that the Affiliation Agreement was executed on August 11, 2004, 
thereby causing the statute of limitations to expire on August 11, 
2005. Comcast asserts that its exercise of its contractual right to 
retier the NFL Network cannot be the triggering event because that is a 
decision made under the Affiliation Agreement and any disagreement 
regarding the terms of the agreement must be addressed in state court. 
In response, the NFL states that its complaint does not allege that the 
Affiliation Agreement violates the program carriage rules. Rather, the 
NFL claims that the issue is the legality of Comcast's act of retiering 
the NFL Network to a premium sports tier between June 1, 2007 and July 
15, 2007. The NFL states that it filed its complaint within days after 
its pre-filing notice and less than a year after Comcast's action to 
retier the NFL Network, in compliance with the statute of limitations 
in Section 76.1302(f)(3). Comcast argues that the statute of 
limitations period cannot run from the date of the NFL Network's pre-
filing notice. Comcast alleges that such an interpretation would allow 
a programmer to bring a program carriage complaint simply by sending a 
``trigger'' letter at any time. The NFL contends, however, that the 
statute of limitations cannot be interpreted to run only from the date 
an existing agreement was executed because that would preclude a 
programmer from seeking relief regarding discriminatory acts that 
occurred greater than one year after the agreement was executed.
    64. We conclude that the NFL filed its program carriage complaint 
in compliance with the program carriage statute of limitations. The 
alleged act of discrimination about which the NFL complains is 
Comcast's act of moving the NFL Network from a digital basic tier to a 
premium sports tier. This act occurred no earlier than June 2007. The 
NFL filed its program carriage complaint within one year of this act 
and within one year of its pre-filing notice. Accordingly, the NFL 
filed its complaint in compliance with the statute of limitations. We 
reject Comcast's argument that the one-year statute of limitations is 
triggered by the execution of the agreement because that act did not 
give rise to the discrimination claim and treating that act as the 
triggering event here would render Section 76.1302(f)(3) of our rules 
superfluous and frustrate enforcement of the statute and rules.
2. Dismissal Pending Litigation
    65. Comcast argues that the NFL complaint should be dismissed 
pending the outcome of the state court litigation. Comcast states that 
the NFL and Comcast are involved in contract litigation involving the 
same set of operative facts that underlie the complaint, and the 
resolution of which is inextricably intertwined with the resolution of 
the complaint. Comcast contends that, if the court rules that the 
Conditional Tiering Provision was triggered, then it would be difficult 
if not impossible for the Commission to decide that Comcast violated 
the program carriage rules by exercising a right granted to it by the 
NFL. According to the NFL, however, the issue of the interpretation of 
the contract is irrelevant to the program carriage dispute. In the 
NFL's view, even if the court finds that the Conditional Tiering 
Provision was triggered and Comcast had the ``right'' to retier the NFL 
Network, Comcast could not exercise that right in a discriminatory 
manner that violates the program carriage rules. According to the NFL, 
Section 616 protects independent programmers and the public regardless 
of the terms of a private agreement. Comcast asserts that dismissal of 
the complaint pending litigation is consistent with Commission 
precedent. The NFL disputes this and notes that the Commission 
addressed a program carriage complaint filed by TCR Sports Broadcasting 
Holding, L.L.P. against Comcast despite the pendency of related 
litigation in state court. Comcast also claims that it would be a waste 
of resources for the Commission to consider the complaint because the 
parties have already decided to mediate the issues in dispute. 
According to Comcast, the NFL agreed to a broad mediation that would 
encompass all issues between the parties, including those in the 
program carriage complaint proceeding. According to the NFL, the state 
court litigation does not address the issues of program carriage 
discrimination addressed in the program carriage complaint proceeding. 
The NFL also states that, even if the court were to address program 
carriage discrimination, it would not be ripe for resolution until 
after the next football season and likely the one that follows (2009-
2010). The NFL also notes that the parties have not agreed to seek a 
stay of the program carriage proceeding pending the outcome of the 
mediation.

[[Page 65321]]

Thus, the NFL argues that