Cable Service Change Notifications; Modernization of Media Regulation Initiative; Retransmission Consent, 71848-71855 [2020-23305]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 85, Number 219 (Thursday, November 12, 2020)]
[Rules and Regulations]
[Pages 71848-71855]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-23305]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 76

[MB Docket Nos. 19-347, 17-105, 10-71; FCC 20-135; FRS 17141]


Cable Service Change Notifications; Modernization of Media 
Regulation Initiative; Retransmission Consent

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Commission revises the regulations 
governing the notices that cable operators must provide subscribers and 
local franchise authorities (LFAs) regarding rate and service changes. 
Specifically, document amends the rules to clarify that when service 
changes occur due to retransmission consent or program carriage 
negotiations that fail within the last 30 days of a contract, cable 
operators must provide notice to subscribers ``as soon as possible,'' 
rather than 30 days in advance. The document also eliminates the 
requirement that cable operators not subject to rate regulation provide 
30 days' advance notice to LFAs of rate or

[[Page 71849]]

service changes. Finally, it eliminates the requirement that cable 
operators provide notice of any significant change to the information 
required in the certain annual notices, as well as adopts several non-
substantive revisions that clarify the rules and eliminate redundant 
provisions. The Commission concludes that these changes will make 
consumer notices more meaningful and accurate, reduce consumer 
confusion, better ensure that subscribers receive the information they 
need to make informed choices about their service options, and reduce 
unnecessary regulatory burdens.

DATES: Effective November 12, 2020.

FOR FURTHER INFORMATION CONTACT: For additional information on this 
proceeding, contact John Cobb, [email protected], of the Policy 
Division, Media Bureau, (202) 418-2120.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report 
and Order, MB Docket Nos. 19-347, 17-105, 10-71; FCC 20-135, adopted on 
September 30, 2020 and released on October 1, 2020. The full text of 
this document is available via ECFS (https://www.fcc.gov/cgb/ecfs/). 
(Documents will be available electronically in ASCII, Word, and/or 
Adobe Acrobat). To request these documents in accessible formats 
(computer diskettes, large print, audio recording, and Braille), send 
an email to [email protected] or call the Commission's Consumer and 
Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432 
(TTY).

Synopsis

    In this Report and Order, we revise our regulations governing the 
notices that cable operators must provide subscribers and local 
franchise authorities (LFAs) regarding rate and service changes. 
Specifically, we amend Sec.  76.1603 of our rules to clarify that when 
service changes occur due to retransmission consent or program carriage 
negotiations that fail within the last 30 days of a contract, cable 
operators must provide notice to subscribers ``as soon as possible,'' 
rather than 30 days in advance. We also amend Sec.  76.1603(c) to 
eliminate the requirement that cable operators not subject to rate 
regulation provide 30 days' advance notice to LFAs of rate or service 
changes. Finally, we amend Sec.  76.1603(b) to eliminate the 
requirement that cable operators provide notice of any significant 
change to the information required in the Sec.  76.1602 annual notices, 
as well as adopt several non-substantive revisions to Sec. Sec.  
76.1601 and 76.1603 that clarify the rules and eliminate redundant 
provisions. We adopt these changes to make consumer notices more 
meaningful and accurate, reduce consumer confusion, better ensure that 
subscribers receive the information they need to make informed choices 
about their service options, and reduce unnecessary regulatory burdens. 
With this proceeding, we continue our efforts to modernize our 
regulations to better reflect today's media marketplace.
    Background. As explained fully in the NPRM, several provisions of 
the Communications Act of 1934, as amended (the Act)--sections 623(b), 
624(h), and 632--address the notices that cable operators must provide 
to their subscribers and LFAs regarding service or rate changes. The 
Commission adopted regulations implementing these notice requirements 
through several decisions in 1993 and consolidated those regulations 
into a newly created subpart T in 1999. Two sections within that 
subpart are at issue in this Report and Order. First, Sec.  76.1601 
obligates cable operators to provide 30 days' advance notice to 
broadcast television stations and to subscribers of the deletion or 
repositioning of any such station. Second, Sec.  76.1603 places several 
additional notice obligations on cable operators. Subsection (b) 
requires that cable operators notify subscribers of ``any changes in 
rates, programming services or channel positions'' and any significant 
changes in the information required by Sec.  76.1602 as soon as 
possible in writing and 30 days in advance if the change is within the 
control of the cable operator. Subsection (c) requires that cable 
operators notify LFAs 30 days ``before implementing any rate or service 
change.'' Finally, subsection (d) requires cable operators to ``provide 
written notice to a subscriber of any increase in the price to be 
charged for the basic service tier or associated equipment at least 30 
days before any proposed increase is effective.'' These rules, which 
notably apply only to cable operators and not to other multichannel 
video programming distributors (MVPDs), have overlapping obligations as 
a result of the consolidation in 1999.
    In 2011, the Commission sought comment on whether to revise Sec.  
76.1601 ``to require that notice of potential deletion of a 
broadcaster's signal be given to consumers once a retransmission 
consent agreement is within 30 days of expiration, unless a renewal or 
extension has been executed, and regardless of whether the station's 
signal is ultimately deleted.'' The Commission noted that while 
adequate advance notice of retransmission consent disputes can allow 
consumers to prepare for service disruptions, ``such notice can be 
unnecessarily costly and disruptive when it creates a false alarm, 
i.e., concern about disruption that does not come to pass, and induces 
subscribers to switch MVPD providers in anticipation [thereof].''
    In December 2019, we adopted the NPRM in this proceeding as a part 
of our ongoing Media Modernization Initiative. In the NPRM, we proposed 
three primary changes to the notice obligations in Sec. Sec.  76.1601 
and 76.1603: (1) Clarifying in Sec.  76.1603(b) that cable operators 
have no obligation to provide notice to subscribers 30 days in advance 
of channel lineup changes when the change is due to retransmission 
consent or program carriage negotiations that fail during the last 30 
days of a contract but that rather, in such a situation, they must 
provide notice ``as soon as possible;'' (2) modifying Sec.  76.1603(c) 
to require service and rate change notices to LFAs only if required by 
an LFA; and (3) adopting several technical edits to Sec. Sec.  76.1601 
and 76.1603 to make the rules more readable and remove duplicative 
requirements. We received seven comments and three replies in response 
to the NPRM. Cable operators, ACA Connects (ACA) and NCTA--The internet 
and Television Association (NCTA) generally supported all of our 
proposals, while The National Association of Telecommunications 
Officers and Advisors (NATOA) and various LFAs raised concerns in 
opposition to the proposals to clarify the service change notice 
obligations in instances involving failed program carriage or 
retransmission consent negotiations and to require notice to LFAs only 
if they specifically request it.
    Discussion. In this Report and Order, we adopt several revisions to 
the rules in Sec. Sec.  76.1601 and 76.1603 governing the notices that 
cable operators must provide to subscribers and LFAs regarding rate and 
service changes. First, we adopt our proposal to clarify that cable 
operators must provide notice as soon as possible in the event of 
service changes that occur due to retransmission consent or program 
carriage negotiations that fail in the final 30 days of a contract, 
rather than 30 days in advance; we also provide guidance on which means 
are reasonable to provide that notice. Second, we amend the LFA notice 
requirements to eliminate the requirement that all cable operators 
provide 30 days' advance notice to LFAs of any changes in rates or 
services rather than adopting our initial proposal

[[Page 71850]]

concerning LFA notice. Instead, we conclude that only cable operators 
subject to rate regulation will be required to provide 30 days' advance 
written notice to LFAs of any proposed increase in the price to be 
charged for the basic service tier. Finally, we eliminate the 
requirement that cable operators provide notice of any significant 
change to the information required in the Sec.  76.1602 annual notices, 
as well as adopt several technical edits to make the rules more 
readable and remove duplicative requirements.
    Service Change Notice Due to Failed Retransmission Consent and 
Program Carriage Negotiations. We adopt our proposal to amend Sec.  
76.1603(b) to clarify that cable operators must provide subscribers 
notice ``as soon as possible'' when service changes occur due to 
retransmission consent or program carriage negotiations that fail 
within the last 30 days of a contract, rather than 30 days in advance. 
In doing so, we reverse our previous view that such negotiations are 
within the control of cable operators. Instead, we adopt a new rule 
that failed program carriage or retransmission consent negotiations 
will be deemed outside of cable operators' control. In all other 
circumstances, however, the subscriber notice requirements will 
continue to operate as they have previously. That is, rate and service 
changes must be provided 30 days in advance of any change, unless the 
change is outside the cable operators' control, in which case it must 
be provided as soon as possible. We conclude that this action will make 
subscriber notices more meaningful and accurate, reduce consumer 
confusion, and ensure that subscribers receive the information they 
need to make informed choices about their service options.
    We reverse the Commission's previous interpretation that program 
carriage and retransmission consent negotiations are within the control 
of a cable operator for the purpose of Sec.  76.1603(b). No commenter 
argued that the Commission should retain its current interpretation 
that negotiations are within the control of cable operators in this 
context. We agree with the multiple commenters that contend that 
retransmission consent and program carriage negotiations are not within 
the control of the cable operator because cable operators cannot 
unilaterally control the outcome of such negotiations. Or, as the 
saying goes, it takes two to tango. Thus, we find that service changes 
that occur as a result of failed program carriage or retransmission 
consent negotiations are not within the control of a cable operator and 
amend Sec.  76.1603(b) to provide so explicitly. We emphasize that this 
change applies only in the specific context of program carriage or 
retransmission consent renewal negotiations that fail within the final 
30 days of an existing contract and result in a service change.
    We find that this change is consistent with the Act. As noted in 
the NPRM, section 632(b) of the Act directs the Commission to adopt 
``standards by which cable operators may fulfill their customer service 
requirements,'' and section 632(c) affords cable operators the 
flexibility to ``provide notice of service and rate changes to 
subscribers using any reasonable written means at its sole 
discretion.'' These statutory provisions do not explicitly state that 
all notices must be provided in advance. In fact, section 632(c) refers 
only to ``notice,'' whereas various other provisions of the Act 
specifically require ``advance notice.''
    We are persuaded that requiring cable operators to provide notice 
to subscribers that a channel may be dropped whenever a program 
carriage or retransmission consent renewal negotiation extends into the 
final 30 days of an existing contract would cause substantial consumer 
confusion and thus would not further the goal of facilitating informed 
choices. We are not persuaded by LFAs' contention that subscribers need 
advance notice of potential deletions so that they can seek alternative 
sources of the programming that could ultimately be deleted. Although 
the legislative history of the Telecommunications Act of 1996 indicates 
that Congress wanted ``to ensure that consumers have sufficient warning 
about rate and service changes so they can choose to disconnect their 
service prior to the implementation of the change,'' we conclude that 
notices about deletions that may never occur are confusing to consumers 
and, therefore, do not fulfill this goal. The record provides ample 
evidence that program carriage and retransmission consent negotiations 
often come down to the final days--if not hours--of an existing 
contract and rarely result in a signal deletion. For example, Altice 
notes that in 2019 at least 90 percent of Altice USA's programming 
negotiations were resolved during the final 30 days of an existing 
contract and that agreements were reached with all its programming 
partners without any channels going dark. Similarly, ACA contends that 
``[c]arriage agreements are almost always renewed within days (or even 
hours) of their expiration, and sometimes following multiple short-term 
extensions.'' Likewise, NCTA asserts that ``[t]he vast majority of 
these negotiations end successfully.''
    The record does not support requiring cable operators to bombard 
subscribers with notices whenever retransmission consent or program 
carriage negotiations continue into the last 30 days of a contract. As 
cable commenters observe, the most contentious negotiations--i.e., 
those most likely to result in a programming blackout--are often the 
subject of news reports, advertisements, and social media posts, which 
provide consumers with information about potential programming disputes 
and encourage them to ``make their voices heard'' with their cable 
operator. Further, we do not agree with LFAs that notices could be 
sufficiently tailored to avoid causing consumer confusion given the 
large number of renewal negotiations that extend into the final 30 days 
of an existing contract and the concomitant volume of potential 
deletion notices in situations where the channel is not ultimately 
deleted. Rather, we agree with commenters that caution that providing 
inherently uncertain notices about potential channel deletions that 
ultimately do not come to pass could cause some consumers to incur 
``the burden and expense of switching video providers under the belief 
that they will soon lose their favorite programming, only later to find 
(in the vast majority of cases) that a deal was reached that avoided 
this outcome.'' We also find that sending repeated notices about 
changes that do not ultimately occur would make it more likely that 
many subscribers would ignore those notices, resulting in their missing 
information about changes that actually do occur.
    We interpret ``as soon as possible'' to require cable operators to 
provide notice without delay after negotiations have failed such that 
the cable operator is reasonably certain it will no longer be carrying 
the programming at issue, and, if possible, before the programming goes 
dark. The Commission has not previously defined what it means to 
provide notice ``as soon as possible'' in Sec.  76.1603(b) when changes 
occur due to circumstances outside of a cable operator's control. No 
commenter offered any arguments in support of adopting a specific 
timeframe to satisfy the ``as soon as possible'' standard. We conclude 
that determining whether a notice was delivered as soon as possible is 
a necessarily fact-specific determination, and thus we decline to adopt 
any firm timeframe during which a notice would presumptively satisfy 
the standard. We disagree with Verizon's suggestion that a channel's 
going dark should be necessary to

[[Page 71851]]

trigger the delivery of a notice about the service change as soon as 
possible, because delivery could be triggered earlier if negotiations 
have reached the point where a cable operator is reasonably certain it 
will no longer be carrying the programming at issue. We do, however, 
agree that if the channel has gone dark, negotiations have clearly 
failed so as to trigger the notice requirement.
    Form of Notice. We revise our rules to clarify that cable operators 
have some flexibility as to the means by which they provide written 
notice to communicate service changes to subscribers when those changes 
result from failed program carriage or retransmission consent 
negotiations or other changes that are outside the cable operator's 
control. Section 632(c) of the Act states that a cable operator may use 
``any reasonable written means at its sole discretion'' to deliver 
notice of service and rate changes to subscribers, and in 2018, the 
Commission adopted new rules that interpret this section of the Act to 
permit the electronic delivery of consumer notices by cable operators. 
In the Order adopting those rules, the Commission indicated that it 
would address the issue of rate and service change notices in a 
separate proceeding, given that these notices ``provide targeted and 
immediate information about a single event rather than a comprehensive 
catalog of information.'' We conclude that in these cases where service 
change are due to circumstances outside a cable operator's control, our 
interpretation of ``reasonable notice'' must reflect that cable 
operators need flexibility in giving notice to consumers. Therefore, in 
these specific cases, we will not require cable operators to follow the 
electronic notification procedures set forth in Sec.  76.1600 of our 
rules, but instead we amend Sec. Sec.  76.1600 and 76.1603 of rules to 
permit them to provide notice through other direct and reliable written 
means that can reach subscribers more quickly.
    In this regard, we conclude that a channel slate on the vacant 
channel that appears after the programming has been dropped is a 
reasonable means to communicate the service change to viewers in the 
immediate aftermath of a channel going dark. We agree with those 
commenters who assert that channel slates are the most direct form of 
notice to immediately inform interested subscribers about a channel 
deletion. We reject the Joint LFAs' contention that channel slates are 
an inadequate form of notice on their own because they only become 
available after the programming has been dropped. Rather, because these 
negotiations, by their very nature, often continue until the final 
minutes of existing contracts, we find that a channel slate could be 
the most immediate direct form of notice to reach affected subscribers 
in the event of a last-minute channel deletion. Thus, we conclude that 
channel slates would satisfy the ``any reasonable written means'' 
standard in the specific context of a service change due to 
retransmission consent or program carriage renewal negotiations that 
fail near the end of an existing contract, as they would communicate 
time-sensitive notice about service changes to subscribers via the 
quickest means possible. Accordingly, we revise Sec.  76.1603 to 
provide that cable operators shall provide notice of service changes 
outside of their control ``as soon as possible using any reasonable 
written means at the operator's sole discretion, including channel 
slates.'' We note that there may be situations in which a channel slate 
may not satisfy the ``as soon as possible'' standard despite the 
service change resulting from program carriage or retransmission 
consent negotiations that fail within the final 30 days of an existing 
contract. For example, if carriage negotiations between a cable 
operator and a programmer fail well in advance of the expiration of the 
contract, and the cable operator does not intend to continue 
negotiating, we would expect such operator to deliver notice through 
other means--such as email--before the channel goes dark. Similarly, to 
the extent possible, we expect and encourage cable operators to inform 
subscribers through multiple types of ``written means'' to ensure that 
subscribers are adequately informed about any changes to their cable 
service.
    In addition, we agree with Verizon that newspaper notice is not a 
reasonable written means of notice in this context. Notably, no 
commenter suggested that newspaper notice in this context should be 
deemed reasonable. As Verizon asserts, newspaper notices ``may not 
reach all customers and may be delayed, inaccurate by the time they are 
published, or unread altogether, [and do] not provide timely notice to 
allow customers to make informed decisions about potential service 
changes.'' Given this, we conclude that such notice is insufficient to 
satisfy the reasonable written means standard in the context of failed 
program carriage or retransmission consent negotiations.
    Notices of Service or Other Changes to Local Franchise Authorities. 
We conclude that in areas that are no longer subject to rate regulation 
the substantial costs to cable operators of complying with the LFA rate 
and service change notice requirements outweigh any potential benefits 
that could accrue to consumers as a result of these notices. 
Accordingly, rather than adopting our initial proposal, we eliminate 
the LFA notice requirement for cable systems subject to effective 
competition under the Commission's rules and adopt a requirement that 
rate regulated systems provide LFAs with 30 days' advance notice of any 
proposed increase in the price to be charged for the basic service 
tier.
    We are not persuaded that we should preserve the current 
requirements that cable operators notify LFAs before implementing any 
rate or service change with respect to those cable operators that face 
effective competition. First, in the absence of rate regulation, LFAs 
have little practical use for this information because changes in rates 
or services are no longer subject to an LFA's authority. And the cable 
operator is in fact better positioned to address subscriber inquiries 
concerning rate or service changes than LFAs because LFAs receive only 
the same information that subscribers already receive under the notice 
requirements in Sec.  76.1603(b). Second, those LFAs that do rely on 
these notices to address subscriber inquiries or complaints can 
implement their own notice requirements, consistent with the Act. Given 
that there is evidence that cable operators incur significant costs to 
comply with the current requirements and little evidence that there is 
widespread use of these LFA notices to benefit subscribers, we 
eliminate the LFA notice requirement for most cable operators.
    We are persuaded to eliminate the LFA rate and service change 
notice requirements on cable operators subject to effective competition 
by the multiple commenters who contend that the costs to cable 
operators of complying with these LFA notice requirements outweigh any 
benefit to consumers from retaining the requirements. Contradicting 
NATOA's assertion that notifying LFAs is a de minimis additional 
expense, cable operators present evidence in the record that they 
expend significant resources to comply with the LFA notice 
requirements. Specifically, NCTA highlights several examples from its 
members' experiences, including one cable operator who budgets $85,000 
annually to deliver LFA notices, in addition to the internal resources 
devoted to ensure compliance. Further, NCTA points out that in some 
instances changes that affect only a handful of subscribers nationwide 
require that notice be delivered to all of the hundreds, if not 
thousands, of LFAs within a cable operator's service area.

[[Page 71852]]

Altice suggests that it has added difficulties complying with the LFA 
notice requirements, particularly in more rural and sparsely populated 
jurisdictions where it has had difficulty ascertaining the relevant 
contact information. We conclude that any benefit that may accrue to 
consumers from the LFA notice requirements does not outweigh the costs 
identified in the record. We disagree with those commenters that 
maintain that we should preserve the LFA notice requirement in its 
current form to enable LFAs to address inquiries and complaints from 
subscribers. Although NATOA argues that their LFA members rely on these 
notices to address inquiries and complaints, Altice asserts that LFAs 
rarely follow up with inquiries regarding these notices and that 
subscribers can obtain such information directly from the cable 
operator. Moreover, cable operators contend that the LFA notice 
requirements are the relic of an era of widespread rate regulation of 
cable systems and are no longer necessary now that there is effective 
competition nearly nationwide such that LFAs do not need the rate 
information to field consumer calls.
    Although we disagree that the current notice requirement is 
necessary in areas that are subject to effective competition, we are 
persuaded that notice of certain rate changes is critical to LFAs 
certified to regulate cable operator rates because they must be made 
aware of those rate changes before they take effect to fully exercise 
their rate regulation authority. Thus, we retain the requirement to 
provide notice of certain rate changes only with respect to those cable 
operators in areas where they are not subject to effective competition. 
Specifically, we adopt a rule, consistent with the language of section 
623(b)(6), that such operators must provide LFAs with 30 days' advance 
notice of any increase proposed in the price to be charged for the 
basic service tier. This requirement will ensure that relevant LFAs 
receive notice of any proposed increase in the rates they have the 
authority to regulate. We specifically do not require cable operators 
in areas where they are subject to rate regulation to provide advance 
notice of service changes or of rate changes other than the type 
described above. This type of notice is not contemplated by section 
623(b)(6), and we find that the information gathered from such notices 
is of little if any use to LFAs, even in areas subject to rate 
regulation.

Other Rule Changes

    Notice of Significant Changes to Information in Annual Notices. We 
eliminate from Sec.  76.1603(b) the requirement that cable operators 
provide notice of any significant change to the information required in 
the Sec.  76.1602 annual notices, as proposed by NCTA. No commenter 
contends that we should retain this requirement. NCTA asserts that 
``[t]his rule is yet another artifact of a time when cable operators 
faced little competition and consumers did not have ready access to 
such information over the internet.'' We find that much of the 
information encompassed by the annual notice, such as that concerning 
installation policies and instructions for use, may not be as relevant 
to current subscribers as changes in rates and services. Changes to 
rates and services are still required under the rules we adopt today to 
be provided either ``as soon as possible'' or within 30 days of the 
change. With respect to the other categories of information, we agree 
with NCTA that interested subscribers would likely first turn to the 
internet for such information. We therefore conclude that we should 
eliminate this requirement.
    Readability and Redundancy. We adopt as proposed in the NPRM three 
technical changes to Sec. Sec.  76.1601 and 76.1603 to clean up the 
rules. Commenters who addressed these proposals--representing both 
cable providers and LFAs--expressed unanimous support for amending 
these provisions to eliminate redundancies, which resulted from 
previous streamlining efforts that consolidated multiple, disparate 
notice provisions into one new subpart. First, we amend Sec.  76.1601 
to delete the requirement that cable operators provide notice of the 
deletion or repositioning of a broadcast channel ``to subscribers of 
the cable system,'' as it is redundant of the subscriber notice 
requirements in Sec.  76.1603. This action will consolidate all of the 
subscriber notice requirements into one provision, Sec.  76.1603(b). 
Second, we delete Sec.  76.1603(d), which requires that cable operators 
notify subscribers about changes in rates for equipment that is 
provided without charge under Sec.  76.630, because it is duplicative 
of language in Sec.  76.630(a)(1)(vi). Finally, we delete Sec.  
76.1603(e), which provides that a cable operator ``may provide such 
notice using any reasonable written means at its sole discretion.'' 
This provision is duplicative of language in section 632(c) of the Act 
and language in Sec.  76.1603(b).
    Other Proposals. We also adopt our proposal to eliminate the 
language regarding the carriage of multiplexed broadcast signals in 
Sec.  76.1603(c), which was supported by NCTA and unopposed by all 
other commenters. This requirement was added at the advent of digital 
broadcast television and does not reflect the standard practices of 
cable operators with regard to multiplexed broadcast signals.
    We decline to adopt Joint LFAs' proposal that we eliminate the 
requirement in Sec. Sec.  76.1602(a) and 76.1603(a) that an LFA provide 
cable operators with 90 days' written notice of its intent to enforce 
the customer service standards found in Sec. Sec.  76.1602 and 76.1603. 
We agree with NCTA that these LFA notices of intent to enforce 
requirements ``are a necessary and appropriate mechanism for alerting 
cable operators of an LFA's enforcement plans.'' Further, given that 
Joint LFAs' appear to have misunderstood these rules, their arguments 
for their removal are not persuasive.
    Final Regulatory Flexibility Analysis. As required by the 
Regulatory Flexibility Act of 1980, as amended (RFA), the Commission 
has prepared a Final Regulatory Flexibility Analysis (FRFA) relating to 
this Order. The FRFA is set forth below.
    Paperwork Reduction Act Analysis. This document does not contain 
new or modified information collection requirements subject to the 
Paperwork Reduction Act of 1995 (PRA), Public Law 104-13. In addition, 
therefore, it does not contain any new or modified information 
collection burden for small business concerns with fewer than 25 
employees, pursuant to the Small Business Paperwork Relief Act of 2002, 
Public Law 107-198, see 44 U.S.C. 3506(c)(4).
    Congressional Review Act. The Commission has determined, and the 
Administrator of the Office of Information and Regulatory Affairs, 
Office of Management and Budget, concurs that, this rule is ``non-
major'' under the Congressional Review Act, 5 U.S.C. 804(2). The 
Commission will send a copy of this Report & Order to Congress and the 
Government Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).
    Final Regulatory Flexibility Act Analysis. As required by the 
Regulatory Flexibility Act of 1980, as amended (RFA), an Initial 
Regulatory Flexibility Analysis (IRFA) was incorporated in the Notice 
of Proposed Rulemaking in this proceeding. The Commission sought 
written public comment on the proposals in the NPRM, including comment 
on the IRFA. We received no comments specifically directed toward the 
IRFA. This present Final Regulatory

[[Page 71853]]

Flexibility Analysis (FRFA) conforms to the RFA.
    Need for, and Objective of, the Report and Order. In today's video 
marketplace, retransmission consent and program carriage negotiations 
are often concluded within days--if not hours--of the expiration of 
existing agreements. And in those cases, it is frequently unclear, 30 
days prior to a contract's expiration, whether a new agreement will be 
reached, there will be a short-term extension, or programming will be 
dropped. This uncertainty led to difficult questions regarding what 
notice cable operators should be required to provide to subscribers and 
when they should be required to provide it. On the one hand, 
subscribers must receive meaningful information regarding their 
programming options so they can make informed decisions about their 
service. On the other hand, inaccurate or premature notices about 
theoretical programming disruptions that never come to pass can cause 
consumer confusion and lead subscribers to change providers 
unnecessarily.
    This Report and Order modifies our rules concerning notices that 
cable operators must provide to subscribers and local franchise 
authorities (LFAs) regarding service or rate changes. First, we clarify 
that cable operators must provide notice as soon as possible in the 
event of service changes that occur due to retransmission consent or 
program carriage that fail in the final 30 days of a contract, rather 
than 30 days in advance. We are persuaded that requiring cable 
operators to provide notice to subscribers that a channel may be 
dropped anytime a program carriage or retransmission consent renewal 
negotiation extends into the final 30 days of an existing contract 
would cause substantial consumer confusion and thus would not further 
the goal of facilitating informed choices. In all other circumstances, 
however, the subscriber notice requirements will continue to operate as 
they have previously. That is, rate and service changes must otherwise 
be provided 30 days in advance of any change, unless the change is 
outside the cable operators' control, in which case it must be provided 
as soon as possible.
    Second, we amend our rule to eliminate the requirement that cable 
operators not subject to rate regulation provide 30 days' advance 
notice to LFAs for rate or service changes, and instead retain a 
narrower requirement that rate-regulated cable systems continue to 
provide 30 days' advance notice to the relevant LFA of any increase 
proposed in the price to be charged for the basic service tier. 
Finally, we eliminate the requirement that cable operators provide 
notice of any significant change to the information required in the 
annual notices that must be sent to subscribers, as well as adopt 
several technical edits to make the rules more readable and remove 
duplicative requirements.
    Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA. There were no comments filed in response to the IRFA.
    Response to comments by the Chief Counsel for Advocacy of the Small 
Business Administration. Pursuant to the Small Business Jobs Act of 
2010, which amended the RFA, the Commission is required to respond to 
any comments filed by the Chief Counsel for Advocacy of the Small 
Business Administration (SBA), and to provide a detailed statement of 
any change made to the proposed rules as a result of those comments.
    The Chief Counsel did not file any comments in response to the 
proposed rules in this proceeding.
    Description and Estimate of the Number of Small Entities to Which 
Rules Will Apply. The RFA directs agencies to provide a description of, 
and where feasible, an estimate of the number of small entities that 
may be affected by the proposed rules, if adopted. The RFA generally 
defines the term ``small entity'' as having the same meaning as the 
terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' In addition, the term ``small business'' 
has the same meaning as the term ``small business concern'' under the 
Small Business Act. A small business 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. Below, we provide a description of such small entities, as well as 
an estimate of the number of such small entities, where feasible.
    Small Governmental Jurisdictions. A ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data from the 2017 Census of Governments indicates that there 
were 90,075 local governmental jurisdictions consisting of general 
purpose governments and special purpose governments in the United 
States. Of this number there were 36,431 General purpose governments 
(county, municipal and town or township) with populations of less than 
50,000 and 12,040 Special purpose governments (independent school 
districts and special districts) with populations of less than 50,000. 
The 2017 U.S. Census Bureau data for most types of governments in the 
local government category shows that the majority of these governments 
have populations of less than 50,000. Based on this data we estimate 
that at least 48,471 local government jurisdictions fall in the 
category of ``small governmental jurisdictions.''
    Cable Companies and Systems (Rate Regulation Standard). The 
Commission has developed its own small business size standards, for the 
purpose of cable rate regulation. Under the Commission's rules, a 
``small cable company'' is one serving 400,000 or fewer subscribers, 
nationwide. Industry data indicate that, of 4,200 cable operators 
nationwide, all but 9 are small under this size standard. In addition, 
under the Commission's rules, a ``small system'' is a cable system 
serving 15,000 or fewer subscribers. Industry data indicate that, of 
4,200 systems nationwide, 3,900 have fewer than 15,000 subscribers, 
based on the same records. Thus, under this second size standard, the 
Commission believes that most cable systems are small.
    Cable System Operators. The Act also contains a size standard for 
small cable system operators, which is ``a cable operator that, 
directly or through an affiliate, serves in the aggregate fewer than 1 
percent 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.'' There are approximately 45,073,297 
cable subscribers in the United States today. Accordingly, an operator 
serving fewer than 450,733 subscribers shall be deemed a small operator 
if its annual revenues, when combined with the total revenues of all 
its affiliates, do not exceed $250 million in the aggregate. Based on 
the available data, we find that all but five independent cable 
operators serve fewer than 450,733 subscribers. Although it seems 
certain that some of these cable system operators are affiliated with 
entities whose gross annual revenues exceed $250 million, we note that 
the Commission neither requests nor collects information on whether 
cable system operators are affiliated with entities whose gross annual 
revenues exceed $250 million, and therefore we are unable to estimate 
more accurately the number of cable system operators that would qualify 
as small under the definition in the Communications Act.
    Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities. This Report and Order 
modifies three

[[Page 71854]]

requirements for cable operators pertaining to the notices they must 
deliver to subscribers and LFAs in advance of service changes. First, 
the rule that requires cable operators to notify subscribers about 
changes to rates, programming services, or channel positions with 30 
days' advance notice will be clarified to instead require that cable 
operators notify subscribers ``as soon as possible'' in the case of 
retransmission consent or program carriage negotiations that fail 
during the last 30 days of a contract. This will reverse the 
Commission's past position that negotiations are ``within the control 
of the cable operator,'' eliminating the need to notify customers of an 
impending change in programming 30 days in advance when carriage 
negotiations have not yet concluded. Second, the requirement that cable 
operators to notify LFAs of any changes to rates, programming services, 
or channel positions will be eliminated entirely for cable operators 
that are subject to effective competition. Finally, it deletes the 
requirement that cable operators provide notice of any significant 
change to the information required in the annual notices that must be 
sent to subscribers.
    Steps Taken to Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered. The RFA requires an 
agency to describe any significant alternatives that it has considered 
in developing its approach, which may include the following four 
alternatives (among others): ``(1) The establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance an 
reporting requirements under the rule for such small entities; (3) the 
use of performance rather than design standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for such small 
entities.''
    The Report and Order, as stated in Section A of this FRFA, modifies 
two rules to reduce the burden on all cable operators, including small 
operators, as they will not be required to provide as many notices. 
Likewise, this may reduce the burdens on small local governments, which 
would not have to review as many filings. As a part of the Commission's 
Media Modernization Initiative, the intent of changing these 
requirements is to reduce the costs of compliance with the Commission's 
rules, including any related managerial, administrative, legal, and 
operational costs. We anticipate that small entities, as well as larger 
entities, will benefit from this modification.
    Report to Congress. The Commission will send a copy of the Report 
and Order, including this FRFA, in a report to be sent to Congress 
pursuant to the Congressional Review Act. In addition, the Commission 
will send a copy of the Report and Order, including this FRFA, to the 
Chief Counsel for Advocacy of the SBA. A copy of the Report and Order 
and FRFA (or summaries thereof) will also be published in the Federal 
Register.
    Accordingly, it is ordered that, pursuant to the authority 
contained in sections 1, 4(i), 4(j), 623, 624, and 632 of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 
543, 544, and 552, the Report and Order is adopted. It is further 
ordered that the Commission's rules are hereby amended as set forth in 
Appendix A, effective as of the date of publication of a summary in the 
Federal Register. It is further ordered that the Commission's Consumer 
and Governmental Affairs Bureau, Reference Information Center, shall 
send a copy of this Report and Order, including the Final Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration. It is further ordered that the Commission will 
send a copy of the Report and Order in a report to Congress and the 
Government Accountability Office pursuant to the Congressional Review 
Act (CRA). It is further ordered that should no petitions for 
reconsideration or petitions for judicial review be timely filed, MB 
Docket No. 19-347 shall be terminated and its docket closed.

List of Subjects in 47 CFR Part 76

    Administrative practice and procedure, Cable Television, 
Communications, Reporting and recordkeeping requirements, 
Telecommunications.

Federal Communications Commission.
Marlene Dortch,
Secretary.

    For the reasons set forth in the preamble, the Federal 
Communications Commission amends part 76 of title 47 of the Code of 
Federal Regulations as follows:

PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE

0
1. The Authority citation for Part 76 continues to read as follows:

    Authority:  47 U.S.C. 151, 152, 153, 154, 301, 302, 302a, 303, 
303a, 307, 308, 309, 312, 315, 317, 325, 338, 339, 340, 341, 503, 
521, 522, 531, 532, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 
549, 552, 554, 556, 558, 560, 561, 571, 572, 573.


0
2. Amend Sec.  76.5 by adding paragraph (rr) to read as follows:


Sec.  76.5  Definitions.

* * * * *
    (rr) Channel Slates. A written notice that appears on screen in 
place of a dropped video feed.

0
3. Amend Sec.  76.1600 by revising paragraph (a) to read as follows:


Sec.  76.1600  Electronic delivery of notices.

    (a) Except as provided in Sec.  76.1603 for changes that occur due 
to circumstances outside a cable operator's control, which also may be 
provided as set forth in 76.1603(b), written information provided by 
cable operators to subscribers or customers pursuant to Sec. Sec.  
76.1601, 76.1602, 76.1603, 76.1604, 76.1618, and 76.1620 of this 
Subpart T, as well as subscriber privacy notifications required by 
cable operators, satellite providers, and open video systems pursuant 
to sections 631, 338(i), and 653 of the Communications Act, may be 
delivered electronically by email to any subscriber who has not opted 
out of electronic delivery under paragraph (a)(3) of this section if 
the entity:
* * * * *

0
4. Revise Sec.  76.1601 to read as follows:


Sec.  76.1601  Deletion or repositioning of broadcast signals.

    A cable operator shall provide written notice to any broadcast 
television station at least 30 days prior to either deleting from 
carriage or repositioning that station.

0
5. Amend Sec.  76.1603 by:
0
a. Revising paragraphs (b) and (c);
0
b. Removing paragraphs (d) and (e); and
0
c. Redesignating paragraph (f) as paragraph (d).
    The revisions read as follows:


Sec.  76.1603  Customer service--rate and service changes.

* * * * *
    (b) Cable operators shall provide written notice to subscribers of 
any changes in rates or services. Notice shall be provided to 
subscribers at least 30 days in advance of the change, unless the 
change results from circumstances outside of the cable operator's 
control (including failed retransmission consent or program carriage 
negotiations during the last 30 days of a contract), in which case 
notice shall be provided as soon as possible using any reasonable 
written means at the operator's sole discretion, including Channel 
Slates. Notice of rate changes shall include the precise

[[Page 71855]]

amount of the rate change and explain the reason for the change in 
readily understandable terms. Notice of changes involving the addition 
or deletion of channels shall individually identify each channel 
affected.
    (c) A cable operator not subject to effective competition shall 
provide 30 days' advance notice to its local franchising authority of 
any increase proposed in the price to be charged for the basic service 
tier.
* * * * *
[FR Doc. 2020-23305 Filed 11-10-20; 8:45 am]
BILLING CODE 6712-01-P