[Federal Register Volume 60, Number 213 (Friday, November 3, 1995)]
[Proposed Rules]
[Pages 55822-55827]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-27346]



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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 100

[IB Docket No. 95-168; PP Docket No. 93-253; FCC 95-443]


Direct Broadcast Satellite Service

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Federal Communications Commission has adopted a Notice of 
Proposed Rulemaking that proposes a number of new rules for the Direct 
Broadcast Satellite (``DBS'') service, including the use of competitive 
bidding to resolve mutually exclusive applications for DBS resources. 
The Commission seeks comment on all of its tentative conclusions and 
proposed rules.
    As part of its decision in Advanced Communications Corporation, FCC 
95-428 (released October 18, 1995), the Commission reclaimed for the 
public 51 channels of DBS spectrum at two orbital locations (27 
channels at 110 deg. W.L. and 24 channels at 148 deg. W.L.) that had 
previously been assigned to Advanced Communications Corporation 
(``ACC''). The Commission proposes to revise rules and policies in the 
DBS service in order to update the current ``interim'' rules and to 
reassign, by auction or other means, channels at orbital locations 
previously assigned to ACC.

DATES: Comments must be submitted on or before November 20, 1995; reply 
comments must be submitted on or before November 30, 1995. Written 
comments by the public on the proposed and/or modified information 
collections are due November 20, 1995. Written comments must be 
submitted by the Office of Management and Budget (``OMB'') on the 
proposed and/or modified information collections on or before January 
2, 1996.

ADDRESSES: Federal Communications Commission, 1919 M Street NW., 
Washington, D.C. 20554. In addition to filing comments with the 
Secretary, a copy of any comments on the information collections 
contained herein should be submitted to Dorothy Conway, Federal 
Communications Commission, Room 234, 1919 M Street NW., Washington, DC 
20554, or via the Internet to [email protected], and to Timothy Fain, OMB 
Desk Officer, 10236 NEOB, 725--17th Street NW., Washington, DC 20503 or 
via the Internet to [email protected].

FOR FURTHER INFORMATION CONTACT:
Bill Wiltshire or Suzanne Hutchings, International Bureau, (202) 418-
0420; or Diane Conley, Wireless Telecommunications Bureau, (202) 418-
0660. For additional information concerning the information 
collections, contact Dorothy Conway at (202) 418-0217, or via the 
Internet at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking in IB Docket No. 95-168; PP Docket No. 93-253; 
FCC 95-443, adopted October 27, 1995 and released October 30, 1995. The 
complete text of this Notice of Proposed Rulemaking (Notice) is 
available for inspection and copying during normal business hours in 
the FCC Reference Center (Room 239), 1919 M Street NW., Washington, DC, 
and also may be purchased from the Commission's copy contractor, 
International Transcription Service, (202) 857-3800, 2100 M Street NW., 
Suite 140, Washington, DC 20037.
    This Notice contains proposed or modified information collections 
subject to the Paperwork Reduction Act of 1995 (``PRA''), Pub. L. No. 
104-13. It has been submitted to OMB for review under Section 3507(d) 
of the PRA. OMB, the general public, and other Federal agencies are 
invited to comment on the proposed or modified information collections 
contained in this proceeding.

Synopsis of the Notice of Proposed Rule Making

I. Introduction

    1. Over six years ago, in Continental Satellite Corporation, 4 FCC 
Rcd 6292 (1989), the Commission stated that 

[[Page 55823]]
existing DBS permittees would have first right to additional channel 
assignments upon surrender or cancellation of a DBS construction 
permit. the Notice tentatively concludes that this reassignment policy, 
adopted in an era before Congress explicitly authorized the 
Commission's use of auctions and well before any DBS system actually 
went into operation, no longer serves the public interest, and 
therefore should be abandoned.
    2. Accordingly, the Notice proposes new rules for reassigning DBS 
resources. In the Notice, the Commission tentatively concludes that it 
has the statutory authority to auction DBS construction permits if the 
Commission receives mutually exclusive applications, and that the 
objectives of Section 309(j) of the Communications Act, 47 U.S.C. 
309(j), would be served by doing so. Specifically, the Notice proposes 
to auction two DBS construction permits: one for all 28 channels now 
available at the 110 deg. orbital location (27 channels from ACC plus 1 
channel that was never assigned), and another for all 24 channels now 
available at the 148 deg. orbital location. The Commission tentatively 
concludes that these two permits should be awarded through a 
sequential, oral outcry auction. The Notice seeks comment on both the 
proposed use of auctions in the DBS service and the proposed auction 
rules.
    3. The Notice also proposes new rules for the DBS service. In 
particular, the proposed rules would: (1) Establish additional 
performance criteria for new permittees; (2) guard against potential 
anticompetitive conduct by DBS providers; and (3) ensure timely DBS 
service to Alaska and Hawaii. The Notice also requests comment on 
existing Commission policy governing the extent to which DBS resources 
may be put to alternative uses. These rules are proposed in order to 
foster swift utilization of DBS orbital/channel assignments, and to 
ensure that the public reaps the full benefit of DBS spectrum 
resources. The Notice seeks comment on these proposed service rules as 
well.

II. Proposed Service Rules

A. Due Diligence Milestones
    4. The Notice tentatively concludes that combining existing due 
diligence requirements with additional milestones for construction and 
operation of DBS systems by new permittees will prevent unnecessary 
delays in the commencement of service. Accordingly, the Notice proposes 
rules to add two additional performance criteria for those receiving 
DBS construction permits after the effective date of the proposed rule: 
(1) Completion of construction of the first satellite in a DBS system 
within four years of authorization; and (2) launch and operation of all 
satellites in a DBS system within six years of authorization.
B. Use of DBS Capacity
    5. The Notice requests comment on the Commission's existing policy 
for non-conforming uses of DBS resources. That policy requires each DBS 
licensee to begin DBS operations before the end of its first license 
term, but allows otherwise unrestricted use during that term. After 
expiration of the first term, a DBS operator may continue to provide 
non-DBS service only on those transponders on which it also provides 
DBS service, and only up to half of the use of each transponder each 
day. As an example of the comments sought, the Notice suggests that the 
existing restrictions on each DBS transponder could be restated in 
terms of capacity rather than time, so as to accomplish the same goals 
without unduly restricting decisions as to satellite configuration and 
operation, and further invites comment on whether and how to formulate 
a rule to better account for the flexibility of digital transmission 
and compression.
    6. The Notice also refers to the possibility that, as a result of a 
separate proceeding, operators using DBS channels and orbital locations 
may be permitted to provide both domestic and international service. In 
light of that possibility, and the discussion of the permissible non-
standard uses of DBS channels, the Notice requests comment on whether 
the U.S. has the authority to auction permits which may include the 
provision of international service.
C. Pro-Competitive Rules and Policies Spectrum Aggregation Limitations
    7. In order to promote competition and prevent undue concentration 
of limited DBS resources, the Notice tentatively concludes that it may 
now be prudent and appropriate to adopt rules designed to further those 
goals, especially when DBS resources are controlled by the provider of 
a competing, non-DBS service. The analysis begins by tentatively 
concluding that the market in which multichannel video programming 
distributors (``MVPDs'') compete--the market for the delivery of 
multichannel video programming--is an appropriate ``product market'' in 
which to determine the competitive effect of having DBS resources under 
the control of the provider of another type of multichannel video 
distribution service. The Notice also tentatively concludes that (1) 
DBS service rules should address competitive issues relating to the use 
of DBS spectrum to provide the wholesale distribution of DBS services 
to cable operators and other MVPDs; (2) the effect of DBS competition 
in the broader MVPD market will principally be felt in essentially 
local markets; and (3) cross-ownership between DBS operators and other 
MVPDs may present opportunities for anticompetitive strategic conduct 
that potentially has adverse effects at the firm or national level.
    8. Accordingly, the Notice proposes that any DBS licensee or 
operator affiliated with another MVPD be permitted to control or use 
DBS channel assignments at only one of the four orbital locations 
capable of serving the entire contiguous United States (``full-
CONUS''), and seeks comment on whether the proposed spectrum 
limitations should be related to the size of the MVPD involved and 
whether such limitations should differentiate between cable operators 
and other MVPDs. The Notice also proposes that aggregation of DBS 
channel assignments by any DBS permittee or licensee be limited to a 
total of 32 channels at any combination of full-CONUS orbital 
locations, and further seeks comment on whether the Commission should 
impose a limitation on an operator owning a significant number of 
channels at each of multiple full-CONUS orbital locations--e.g., 
prohibiting a DBS permittee or licensee holding more than 16 channels 
at one full-CONUS orbital location from holding channels at any other 
full-CONUS location.
    9. The Notice proposes that any permittee or licensee that acquires 
control over channels in excess of the proposed spectrum limitations be 
given ninety days from the date of Commission approval of such 
acquisition in which to either surrender to the Commission its excess 
channels, or file with the Commission a transfer or assignment 
application in order to divest sufficient channels to bring the 
applicant into compliance with all applicable spectrum limitations.
    10. For purposes of implementing the proposed spectrum aggregation 
limitations, the Notice proposes to consider four orbital locations--
61.5 deg. W.L., 101 deg. W.L., 110 deg. W.L., and 119 deg. W.L.--to be 
capable of full-CONUS service. The Notice tentatively concludes that 
applying the spectrum cap to these four orbital locations will ensure 
that there is sufficient channel capacity for a minimum of four full-
CONUS DBS providers. It also 

[[Page 55824]]
concludes that channels at the other four DBS orbital locations, which 
are not capable of full-CONUS service, probably cannot match the 
economies of scale in domestic service achieved by full-CONUS 
operators, and thus should be exempt from the proposed spectrum 
limitations.
    11. In order to maintain the integrity of the channel aggregation 
limitations, the Notice tentatively concludes that it is necessary to 
count against the spectrum limitations all channels held by DBS 
operators that share some level of common ownership or control. Because 
of concerns that entities could engage in anticompetitive conduct not 
only through control of DBS channels, but also through use of such 
channels, the Notice concludes that it is appropriate to apply spectrum 
limits not only to DBS permittees and licensees, but also to DBS 
operators, defined as any person or group of persons who provide 
services using DBS channels and directly or through one or more 
affiliates own an attributable interest in such satellite system; or 
who otherwise control or are responsible for, through any arrangement, 
the management and operation of such a satellite system. For purposes 
of implementing the spectrum aggregation limitations, the Notice 
proposes to attribute both controlling interests and any interest of 
five percent or more in a DBS permittee, licensee, or operator. The 
Notice proposes to rely on existing case law for making control 
determinations where such issues arise. Specifically, the Notice 
proposes to adopt rules that attribute to the holder any interest of 
five percent or more, whether voting or nonvoting, and all partnership 
interests, whether general or limited. In addition, the Notice proposes 
to adopt attribution rules that (1) attribute any interest of ten 
percent or more held by an institutional investor or investment 
company, rather than a five percent interest; (2) employ a multiplier 
for determining attribution of interests held through intervening 
entities; (3) provide for attribution of interests held in trust; (4) 
attribute the positional interests of officers and directors; (5) 
attribute limited partner interests based not only upon equity but also 
upon percentages of distributions of profits and losses; and (6) 
provide for attribution based upon certain management agreements and 
joint marketing agreements. For purposes of the spectrum limitations, 
the Notice also proposes to identify any individual or entity as an 
affiliate of a licensee, permittee, or operator, or of a person holding 
an attributable interest in a licensee, permittee, or operator, if such 
individual or entity: (i) Directly or indirectly controls or has the 
power to control the licensee, permittee, or operator; (ii) is directly 
or indirectly controlled by the licensee, permittee, or operator; or 
(iii) is directly or indirectly controlled by a third party or parties 
that also has the power to control the licensee, permittee, or 
operator. The Notice also seeks comment on whether the definition of an 
affiliate should also include individuals or entities that have an 
identity of interest with the licensee, permittee, or operator.
Conduct Rules To Protect Competition
    12. In addition to the structural solutions designed to promote 
competition by preventing the potential for undue concentration of DBS 
and MVPD resources, the Notice also proposes conduct limitations on the 
use of DBS channels and orbital locations to encourage, to the maximum 
extent possible, rivalry among MVPDs. Specifically, the Notice further 
proposes to (1) extend the conditions placed on Tempo Satellite, an 
existing DBS permittee that is wholly owned by a cable operator, to all 
MVPD providers that own DBS resources, such that they cannot offer DBS 
service primarily as an ancillary service to their own programming 
distribution services, or provide DBS service to subscribers of their 
non-DBS systems under different terms than are being offered to non-
subscribers; and (2) prevent a DBS operator from selling, leasing, or 
otherwise providing transponder capacity to any entity that enters into 
an agreement with an MVPD granting that MVPD the exclusive right to 
distribute DBS services within, or adjacent to, its service area. The 
Notice also requests comment on whether existing program access and 
program carriage rules adequately address vertical integration concerns 
arising from common ownership among DBS operators, other MVPDs, and 
program vendors, especially in connection with ``headend in the sky'' 
wholesale distribution from DBS satellites.
Other Concerns
    13. The Notice observes that in the Advanced Communications 
Corporation proceeding, commenters raised a number of other concerns 
about potential strategic conduct that could arise from cable-
affiliated ownership of full-CONUS DBS spectrum. Those commenters 
argued that cable-affiliated ownership of full-CONUS DBS spectrum 
should be prohibited, or in the alternative, that several remedial 
conditions should be imposed. The Notice seeks comment on the extent to 
which those and related concerns are implicated by the proposed auction 
of DBS construction permits, and if so, whether additional DBS service 
rules might be appropriate to address those concerns.
East/West Paired Assignments
    14. The Notice tentatively concludes that progress in the DBS 
service since Continental was issued has rendered unnecessary the 
policy, developed in that decision, of assigning DBS channels only in 
east/west pairs, with eastern half-CONUS service permitted only from 
the four eastern orbital locations and western half-CONUS service 
permitted only from the four western orbital locations.
D. Service to Alaska and Hawaii
    15. The Notice proposes: (1) To require that all new permittees 
must provide service to Alaska and Hawaii if such service is 
technically feasible from their orbital locations; and (2) to condition 
the retention of channels assigned to current permittees at western 
orbital locations on provision of such service, from either or both of 
their assigned orbital locations.
E. License Term
    16. The Notice proposes to increase the term of a non-broadcast DBS 
license from 5 years to 10 years, the maximum allowed under the 
Communications Act, which better reflects the useful life of a DBS 
satellite and is consistent with the current proposal for extending the 
term of satellite licenses in other services.

III. Proposed Auctioning of DBS Permits

A. Authority To Conduct Auctions
    17. The Notice tentatively concludes that the Commission has 
authority under Section 309(j) to use competitive bidding to award 
construction permits for the DBS spectrum reclaimed from ACC as well as 
other available DBS spectrum. The Notice tentatively concludes that 
construction permits available for reclaimed DBS spectrum are 
``initial'' within the meaning of Section 309(j). The Notice also 
tentatively concludes that it is likely that mutual exclusivity will 
exist among applications for the DBS channels reclaimed from ACC as 
well as other DBS channels that may become available in the future. The 
Notice further tentatively concludes that there are no means of 
avoiding mutual exclusivity in the DBS service that are consistent with 
the objectives of Section 309(j). The Notice proposes to consider 
mutual exclusivity to occur only when the number of DBS channels sought 
at a given orbital location exceeds the 

[[Page 55825]]
number available there, and it asks for possible alternative criteria 
for identifying mutually exclusive applications. The Notice also 
tentatively concludes that the ``principal use'' requirement of Section 
309(j) is satisfied because DBS is likely to be primarily a 
subscription-based service, and that using competitive bidding to award 
DBS authorizations would promote the objectives of Section 309(j).
B. Competitive Bidding Design
    18. The Notice explains that the Commission has previously 
concluded that the objectives of Section 309(j) will generally best be 
achieved by auctions designed to award authorizations to the parties 
that value them most highly. Such parties are most likely to deploy new 
technologies and services rapidly, and to promote the development of 
competition for the provision of those and other services.
    19. The Notice proposes that available channel assignments be 
auctioned sequentially in two blocks: one block of 28 channels at 
110 deg., including the 27 channels reclaimed from ACC and one channel 
that has never been assigned; and one block of 24 channels at 148 deg., 
which were reclaimed from ACC. The Notice tentatively decides not to 
divide the available blocks into smaller parcels because it appears 
from the configuration of current DBS systems that channels are most 
effectively utilized when they are available in a substantial quantity 
at a given orbital location. The Notice also tentatively concludes that 
there would be little to gain by conducting simultaneous auctions of 
the DBS channels reclaimed from ACC because the channels at 110 deg. 
and those at 148 deg. are not likely to be close substitutes in the 
near term and there is no evidence of synergies between the channels at 
the two orbital locations. If sequential auctioning is used, the Notice 
proposes to auction the channels at 110 deg. first because all of the 
information available indicates that the channels at 110 deg. have the 
highest value of those currently available. The Notice asks whether the 
channels at 110 deg. and at 148 deg. should be offered in a different 
configuration, and whether there are foreseeable circumstances in which 
simultaneous auctions of DBS permits would be more appropriate than 
sequential auctions. The Notice also seeks comment on any general 
principles that may be used to determine the sequence of future DBS 
auctions that may be held if construction permits are auctioned 
sequentially.
    20. The Notice tentatively concludes that multiple round bidding 
would be the best method of auctioning the channels reclaimed from ACC, 
because the value of the construction permits is likely to be very high 
and at the same time may be somewhat uncertain. Single round sealed 
bidding would be a simple method of awarding DBS construction permits, 
but bidders would have to guess about the value that other bidders 
place on the permits and there is a substantial risk that the party 
that values a permit most highly may not submit the winning bid. The 
Notice requests comment on the advantages and disadvantages of both 
single round, sealed bidding and multiple round bidding as a method of 
auctioning DBS permits in the future.
    21. The Notice also tentatively concludes that oral outcry would be 
the best method of submitting bids in the case of DBS, and that this 
method should be used for the channels reclaimed from ACC. An oral 
outcry auction has the advantage of being simple and rapid, and it 
avoids the additional complications associated with electronic filing. 
The Notice seeks comment on whether an oral outcry auction could pose 
problems for bidders that need time between bidding rounds to arrange 
for additional financing if bidding goes higher than anticipated. The 
Notice also seeks comments on whether a combined sealed bid-oral outcry 
auction may be appropriate for the channels available at 110 deg. and 
148 deg. to help reduce the risk of collusion while retaining the 
benefits of a multiple round auction.
C. Bidding Procedures
    22. In the event multiple round auctions are used, imposing a 
minimum bid increment would speed the progress of the auction and help 
to ensure that the auction concludes within a reasonable period. If 
oral outcry is used, the Notice tentatively concludes that the 
auctioneer should have discretion to establish bid increments--and 
raise or lower them in the course of an auction--consistent with 
directions provided by the Commission. The Notice also asks for 
suggestions as to how bid increments should be determined if bids are 
submitted electronically. The Notice also proposes to establish a 
minimum opening bid for the 28 channels available at 110 deg., both to 
help ensure that the auction proceeds quickly and to increase the 
likelihood that the public receives fair market value for the spectrum. 
The Notice asks interested parties to suggest the appropriate level of 
a minimum opening bid for the channels at 110 deg., and it seeks 
comment on whether and how a minimum bid should be established for the 
channels at 148 deg. and other channels that may become available in 
the future.
D. Procedural and Payment Issues
    23. The Notice proposes to apply its general procedural and payment 
rules for auctions to the DBS service, along with certain modifications 
discussed below. In keeping with previous practice, the Notice also 
proposes that the Commission retain discretion to implement or modify 
certain procedures that would be announced by Public Notice prior to 
particular auctions, including rules governing the timing of 
application and payment requirements and any activity and stopping 
rules that may be appropriate.
    24. Under the procedures proposed in the Notice, applicants for DBS 
auctions would file a short-term application, FCC Form 175, with the 
Commission prior to the auction in which they wish to participate. The 
Notice also tentatively concludes that it would be appropriate to allow 
only for manual filing of these forms for the proposed auction of 
spectrum available at 110 deg. and 148 deg., because a small number of 
participants is anticipated.
    25. The Notice proposes that entities that would exceed proposed 
spectrum caps as a result of successful bidding in the proposed 
auctions should be given 90 days following the date of grant of a 
construction permit won through an auction to either surrender to the 
Commission their excess channels or file an application that would 
result in divestiture of the excess channels.
    26. The Notice proposes to require an upfront payment in all DBS 
auctions to help ensure that only serious, qualified bidders 
participate. The Notices seeks comment on how the size of an upfront 
payment should be determined and asks whether it would be appropriate 
to establish an upfront payment of five percent of the spectrum's 
estimated value. The Notice further asks how the value of spectrum 
should be estimated. The Notice also asks whether a single upfront 
payment should qualify parties to bid on both the 110 deg. and 148 deg. 
channel blocks, and, if not, what the appropriate amount of an upfront 
payment would be for each of the two channel blocks. The Notice further 
asks if only the winner of the first permit should be required to 
submit an additional upfront payment if it wishes to bid on the second 
permit. With respect to the collection of upfront payments, the Notice 
proposes that prospective bidders deposit their payments in the 
Commission's lock-box bank by a date certain that would allow the 
Commission sufficient time to verify the availability of the funds 
before the 

[[Page 55826]]
auction. The Notice tentatively concludes that such a procedure would 
minimize the risk of defaults that could force the reauctioning of 
spectrum and asks for comment on alternative collection methods.
    27. The Notice also proposes that every DBS auction winner should 
be required to submit to the Commission an amount sufficient to bring 
its total deposit up to 20 percent of its winning bid within 10 
business days of the announcement of winning bidders. By the same 
deadline, winning bidders would be required to file information in 
conformance with Part 100 of the Commission's Rules and a signed 
statement describing their efforts to date and future plans to come 
into compliance with the proposed spectrum caps. In addition, the 
Notice proposes that winning bidders be required to submit the balance 
of their winning bid within five business days of an announcement that 
the Commission had dismissed or denied any and all petitions to deny. 
Under this proposal, if a winning bidder failed to submit the balance 
of the winning bid or the permit was otherwise denied, a default 
payment would be assessed.
    28. If oral outcry auctions are used, the Notice proposes to rely 
on default payments to deter insincere bidding and provide an incentive 
for bidders wishing to withdraw their bids to do so before bidding 
ceases. Under this proposal, a default payment would be assessed if a 
winning bidder fails to pay the full amount of its 20 percent down 
payment or the balance of its winning bid in a timely manner, or is 
disqualified after the close of an auction. The Notice proposes that 
the amount of such a default payment should be equal to the difference 
between the defaulting auction winner's ``winning'' bid and the amount 
of the winning bid the next time the license is offered for auction by 
the Commission, if the latter bid is lower. In addition, the defaulting 
auction winner would be required to submit a payment of three percent 
of the subsequent winning bid or three percent of its own ``winning'' 
bid, whichever is less.
    29. If single round, sealed bid auctions for DBS used, the item 
proposes to require no payments for withdrawing a bid (1) before the 
bids are opened, or (2) after bids are opened but before the high 
bidder has been notified. However, a payment equal to the difference 
between the high bid and the next highest bid would be required of any 
party that defaults after being notified that it has submitted the high 
bid in a sealed bid DBS auction.
E. Regulatory Safeguards
    30. The Notice proposes that any entity that acquires a DBS 
authorization through competitive bidding, and seeks to transfer that 
authorization within six years of the initial license grant, would be 
required to file, together with its application for FCC consent, the 
associated contracts for sale, option agreements, management 
agreements, or other documents disclosing the total consideration 
received in return for the transfer of its authorization.
    31. The Notice tentatively concludes that the performance 
requirements proposed as part of the DBS service rules are sufficient 
to achieve the statutory goals of ensuring prompt delivery of service 
to rural areas, preventing the stockpiling of spectrum, and promoting 
investment in and rapid deployment of new services, and that it is 
unnecessary to adopt any further performance rules in connection with 
the proposed auction procedures.
    32. Consistent with the Commission's general practice, the Notice 
proposes that bidders be required to identify on their short-form 
applications any parties with whom they have entered into any 
consortium arrangements, joint ventures, partnerships or other 
agreements or understandings which relate in any way to the competitive 
bidding process. Bidders also would be required to certify on their 
short-form applications that they have not entered into any explicit or 
implicit agreements, arrangements or understandings of any kind with 
any parties, other than those identified, regarding the amount of their 
bid, bidding strategies or the particular properties on which they will 
or will not bid.
    33. The Notice further proposes to require winning bidders to 
submit a detailed explanation of the terms and conditions and parties 
involved in any bidding consortia, joint venture, partnership or other 
agreement or arrangement they have entered into relating to the 
competitive bidding process prior to the close of bidding. After short-
form applications are filed, and prior to the time the winning bidder 
has submitted its lump-sum payment of the balance of its bid, all 
applicants would be prohibited from cooperating, collaborating, 
discussing or disclosing in any manner the substance of their bids of 
bidding strategies with other applicants for licenses serving the same 
or overlapping geographical areas, unless such bidders were members of 
a bidding consortium or other joint bidding arrangement identified on 
the bidder's short-form application. Applicants would nonetheless be 
allowed to (1) modify their short-form applications to reflect 
formation of consortia or changes in ownership at any time before or 
during an auction, provided that such changes would not result in a 
change in control of the applicant, and provided that the parties 
forming consortia or entering into ownership agreements have not 
applied for licenses for channels that may be used to cover the same or 
overlapping geographical areas; and (2) make agreements to bid jointly 
for licenses after the filing of short-form applications, provided that 
the parties to the agreement have not applied for licenses that may be 
used to serve the same or overlapping geographical areas. Under the 
proposal, the holder of a non-controlling attributable interest in an 
entity submitting a short-form application would be allowed to acquire 
an ownership interest in, form a consortium with, or enter into a joint 
bidding arrangement with other applicants for licenses that may be used 
to serve the same or overlapping geographical areas after the filing of 
short-form applications, provided that (1) the attributable interest 
holder certifies to the Commission that it has not communicated and 
will not communicate with any party concerning the bids or bidding 
strategies of more than one of the applicants in which it holds an 
attributable interest, or with which it has a consortium or joint 
bidding arrangement, and which have applied for licenses that may be 
used to serve the same or overlapping geographical areas, and (2) the 
arrangements do not result in any change in control of an applicant.
F. Designated Entities
    34. Because of the extremely high implementation costs associated 
with satellite-based services, the Notice tentatively concludes that no 
special provisions should be made for designated entities for the 
channels currently available at 110 deg. and 148 deg.. The Notice seeks 
comment on whether special provisions should be made for designated 
entities in future DBS auctions, and requests comment on whether future 
auctions of smaller blocks of DBS spectrum or technological advances in 
the delivery of DBS service might reduce capital requirement barriers 
for designated entities.

Paperwork Reduction Act

    This Notice contains modified information collections. The 
Commission, as part of its continuing effort to reduce paperwork 
burdens, invites the general public and the Office of Management and 
Budget (``OMB'') to 

[[Page 55827]]
comment on the information collections contained in this Notice, as 
required by the Paperwork Reduction Act of 1995, Pub. L. No. 104-13. 
Public and agency comments are due at the same time as other comments 
on this Notice; OMB comments are due 60 days from date of publication 
of this Notice in the Federal Register. Comments should address: (a) 
Whether the proposed collection of information is necessary for the 
proper performance of the functions of the Commission, including 
whether the information shall have practical utility; (b) the accuracy 
of the Commission's burden estimates; (c) ways to enhance the quality, 
utility, and clarity of the information collected; and (d) ways to 
minimize the burden of the collection of information on the 
respondents, including the use of automated collection techniques or 
other forms of information technology.

47 CFR Part 100

    OMB Approval Number: None.
    Title: Direct Broadcast Satellite Service.
    Form No.: None.
    Type of Review: Approval of existing collection.
    Respondents: Businesses or other for profit.
    Number of Respondents: 8.
    Estimated Time Per Response: 400 hours.
    Total Annual Burden: 3200 hours.
    Needs and Uses: In accordance with the Communications Act, the 
information collected will be used by the Commission in granting DBS 
authorizations, and in determining the technical, legal, and financial 
qualifications of a satellite applicant, permittee or licensee. 
Existing information collection requirements are set forth in Part 100 
of the Commission's Rules and in Commission orders. See e.g., Inquiry 
Into the Development of Regulatory Policy in Regard to Direct Broadcast 
Satellites for the Period Following the 1983 Regional Administrative 
Radio Conference. 90 FCC 2d 676 (1982), recon. denied, 53 RR 2d 1637 
(1983); CBS, Inc., 98 FCC 2d 1056 (1983); Tempo Enterprises, Inc., 1 
FCC Rcd 20, 21 (1986), United States Satellite Broadcasting Co., 3 FCC 
Rcd 6858, 6861-62 (1988).
    Under the existing information collection requirements in the 
Commission's Rules, an entity awarded a DBS Authorization would be 
required to submit the information required pursuant to 47 CFR 100.13, 
100.19, 100.21, 100.51. The Commission proposed to require that DBS 
auction winners submit: (1) Ownership information to determine 
compliance with Parts 1 and 100 of the Commission's Rules; (2) a 
statement describing their efforts to comply with the proposed spectrum 
aggregation limitations; (3) an explanation of the terms and conditions 
and parties involved in any bidding consortia, joint venture, 
partnership, or other agreement or arrangement they enter into relating 
to the competitive bidding process prior to the close of bidding; and 
(4) any agreements or contracts pertaining to the transfer of the DBS 
authorization acquired through auction during the six years following 
grant of the authorization.

Ordering Clauses

    Accordingly, It is Ordered that, pursuant to Sections 1, 4(i), 
4(j), 7, and 309(j) of the Communications Act of 1934, as amended, 47 
U.S.C. 151, 154(i), 154(j), 157, and 309(j), Notice is Hereby Given of 
the proposed amendments to Part 100 of the Commission's Rules, 47 CFR 
Part 100, in accordance with the proposals in this Notice of Proposed 
Rulemaking, and that Comment is Sought regarding such proposals.
    It is Further Ordered that the Secretary shall send a copy of this 
Notice of Proposed Rulemaking, including the Initial Regulatory 
Flexibility Analysis, to the Chief Counsel for Advocacy of the Small 
Business Administration in accordance with paragraph 603(a) of the 
Regulatory Flexibility Act, 5 U.S.C. Sec. 601 et seq.

Administrative Matters

    This is a non-restricted notice and comment rulemaking proceeding. 
Ex parte presentations are permitted, except during the Sunshine Agenda 
period, provided they are disclosed as provided in Commission rules. 
See generally 47 CFR 1.1202, 1.1203, and 1.1206(a).
    Pursuant to applicable procedures set forth in Sections 1.415 and 
1.419 of the Commission's Rules, 47 CFR 1.415 and 1.419, interested 
parties may file comments on or before November 20, 1995 and reply 
comments on or before November 30, 1995. To file formally in this 
proceeding, you must file an original and five copies of all comments, 
reply comments, and supporting comments. If you want each Commissioner 
to receive a personal copy of your comments send additional copies to 
Office of the Secretary, Federal Communications Commission, Washington, 
DC 20554. Comments and reply comments will be available for public 
inspection during regular business hours in the Federal Communications 
Commission, Reference Center, Room 239, 1919 M Street, NW. Washington, 
DC 20554. For further information concerning this rulemaking contact 
Paula Ford at (202)739-0733.

Initial Regulatory Flexibility Act Statement

    As required by Section 603 of the Regulatory Flexibility Act, the 
Commission has prepared an Initial Regulatory Flexibility Analysis 
(``IRFA'') of the expected impact on small entities of the proposals 
suggested in this document. The IRFA is set forth in Appendix A of the 
Notice and is not published in the Federal Register. Written public 
comments are requested on the IRFA. These comments must be filed in 
accordance with the same filing deadlines as comments on the rest of 
the Notice, but they must have a separate and distinct heading 
designating them as responses to the Initial Regulatory Flexibility 
Analysis.

List of Subjects in 47 CFR Part 100

    Radio, Satellites.

Federal Communications Commission.
William F. Caton,
Acting Secretary.
[FR Doc. 95-27346 Filed 11-2-95; 8:45 am]
BILLING CODE 6712-01-M