[Federal Register Volume 61, Number 33 (Friday, February 16, 1996)]
[Rules and Regulations]
[Pages 6131-6138]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-3128]



=======================================================================
-----------------------------------------------------------------------

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 76

[MM Docket No. 92-260; FCC 95-503]


Cable Home Wiring

AGENCY: Federal Communications Commission.

ACTION: Final rule; First Order on Reconsideration.

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

SUMMARY: The First Order on Reconsideration denies petitions for 
reconsideration of the Commission's cable home wiring rules, except to 
specify the procedure a cable operator must follow when a subscriber 
terminates cable service. This order will facilitate competition in the 
video marketplace by clarifying rules governing the disposition of 
wiring.

EFFECTIVE DATE: Upon approval by the Office of Management and Budget. 
At a later date, the Commission will publish a document reflecting the 
actual effective date.

FOR FURTHER INFORMATION CONTACT: Lynn Crakes or Rick Chessen, Cable 
Services Bureau, (202) 416-0800. For additional information concerning 
the information collections contained in this Order contact Dorothy 
Conway at 202-418-0217, or via the Internet at [email protected].

SUPPLEMENTARY INFORMATION: This First Order on Reconsideration 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 the Office of Management and Budget (``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.

Title: 47 CFR 76.802 Disposition of Cable Home Wiring
Type of Review: New Collection
Respondents: Business of other for profit; individuals or households
Number of Respondents: 11,400 cable operators
Estimated Time Per Response: .083 hours (5 minutes)
Total Annual Burden: 18,039 hours

    Needs and Uses: This information disclosure requirement ensures 
that consumers are informed of their cable home wiring purchase rights 
upon termination of cable service, including information regarding the 
purchase of their home wiring in a single contact, and the use of 
wiring to connect to an alternative video programming service. This 
rule promotes competition by clarifying the disposition of wiring upon 
termination of cable service. Cable operators' responsibilities are 
clearly defined and their property rights protected.
    This is a synopsis of the Commission's First Order on 
Reconsideration in MM Docket No. 92-260, FCC No. 95-508, adopted 
December 15, 1995 and released January 26, 1996.

I. Introduction

    1. In this First Order on Reconsideration, we grant in part and 

[[Page 6132]]
    deny in part petitions for reconsideration of the Commission's initial 
cable home wiring regulations implementing Section 16(d) of the Cable 
Television Consumer Protection and Competition Act of 1992 (the ``1992 
Cable Act''). Generally, we: (1) deny the petitions for reconsideration 
of the Commission's cable home wiring rules, except (a) to specify the 
procedure a cable operator must follow when a subscriber voluntarily 
terminates cable service, if the operator wishes to remove the home 
wiring, and (b) to shorten from 30 days to seven business days the time 
period after termination of service within which the cable operator has 
the right to remove any home wiring it owns.
    2. The Commission received three petitions for reconsideration of 
the Report and Order in MM Docket No. 92-260 (``Cable Wiring Order''), 
58 FR 11970 (March 2, 1993)--all from potential or current competitors 
to cable operators--as well as replies to these petitions from cable 
operators. Petitioners' arguments include the following (a) that 
subscribers should be permitted to purchase or to control the cable 
home wiring upon installation rather than upon termination of service, 
(b) that cable operators should be prohibited from misrepresenting 
whether they intend to remove or abandon the home wiring following 
termination of service, (c) that the demarcation point for multiple 
dwelling units should be relocated, (d) that loop-through wiring 
configurations should be included within our rules under certain 
circumstances, and (e) that passive cable equipment should be included 
within the definition of cable home wiring.

II. Order on Reconsideration

A. Customer Access to Cable Home Wiring Prior to Termination of Service

1. Background
    3. Section 16(d) of the 1992 Cable Act requires the Commission to 
``prescribe rules concerning the disposition, after a subscriber 
terminates service, of any cable installed by the cable operator within 
the premises of such subscriber.'' The Commission's regulations 
implementing Section 16(d) provide that, when a customer voluntarily 
terminates service, the cable operator must give that subscriber the 
opportunity to acquire the wiring before the operator removes it. The 
subscriber may purchase the wiring inside his or her premises up to the 
demarcation point, which we defined as a point at or about twelve 
inches outside the subscriber's premises. The operator may not charge 
the subscriber any more than the replacement cost of the wire, priced 
on a per-foot basis. If the subscriber declines to purchase the wiring, 
the operator must remove it within 30 days or make no subsequent 
attempt to remove it or to restrict its use.
    4. In the 1993 Cable Wiring Order, we said that it was not 
``necessary or appropriate under the statute'' to apply our cable home 
wiring rules prior to the time the customer terminates cable service. 
We noted that the plain language of Section 16(d) of the 1992 Cable Act 
refers only to the disposition of cable home wiring after termination 
of service, and that cable home wiring is different from telephone 
wiring in that, for example, cable operators have the responsibility to 
prevent signal leakage which can cause harmful interference to licensed 
radio spectrum users, a responsibility telephone companies do not have. 
We also cited the House Report on the 1992 Cable Act which stated that 
Section 16(d) itself ``does not address matters concerning the cable 
facilities inside the subscriber's home prior to termination of 
service.'' At the same time, the Commission stated:

    [a]lthough we generally believe that broader cable home wiring 
rules could foster competition and could potentially be considered 
in the context of other proceedings, because of the time constraints 
under which we must promulgate rules as required by the Cable Act of 
1992, we decline to address such rule proposals in this proceeding.

2. Petitions
    5. Some petitioners urge the Commission to apply the cable home 
wiring rules prior to termination of service so that the subscriber may 
control cable home wiring immediately upon installation. NYNEX asserts, 
among other things, that consumers should be able to control the cable 
home wiring upon installation so that they can obtain additional 
services from other multichannel video programming service providers 
through simultaneous use of the wire's spare capacity. On the other 
hand, NCTA states that the Commission's current rules fully effectuate 
the statutory language and the underlying purposes of the 1992 Cable 
Act. NCTA and Time Warner claim that the Commission lacks the authority 
under the 1992 Cable Act to mandate that operators convey ownership to 
subscribers at the time of installation. Time Warner also asserts that 
the Commission's current rules violate the takings clause by providing 
that if a cable operator fails to remove its home wiring within 30 days 
following termination of service, the operator is prohibited from 
subsequently attempting to remove the wiring or restrict its use.
3. Discussion
    6. The Commission's current cable home wiring rules implement the 
specific directive of Section 16(d) of the 1992 Cable Act, i.e., to 
establish rules governing the disposition of cable home wiring upon 
termination of cable service. Our current rules promote the goals of 
Section 16(d), which are to protect customers from unnecessary 
disruption and expense caused by the removal of home wiring and to 
allow subscribers to use the wiring for an alternative multichannel 
video programming delivery system. On reconsideration, we are not 
persuaded, based on the record in this proceeding at this time, to 
expand our cable home wiring rules under Section 16(d) of the 1992 
Cable Act. At the same time, we recognize that new competitors, such as 
wireless cable, satellite master antenna television services 
(``SMATVs'') and telephone companies, and new technologies, such as 
video dialtone, are likely to change the video programming delivery 
marketplace. The Commission must therefore consider broad 
telecommunications issues which extend beyond the 1992 Cable Act and 
the record in this proceeding in determining whether to expand the 
cable home wiring rules in ways that could have competitive 
implications for cable operators and other multichannel video 
programming providers, as well as other providers of telecommunications 
services. Given the potential for the convergence of telephone, data 
and video technologies, it may be appropriate to consider requiring 
cable operators to permit subscriber access to inside wiring prior to 
termination of service in order to promote consumer choice and 
competition. Parity with telephone inside wiring may also be desirable 
if a cable operator wants to provide telephone or other common carrier 
service over its coaxial cable, but the record in this proceeding does 
not provide us with sufficient information upon which to base such a 
determination. The Commission will therefore further explore this issue 
in the Notice of Proposed Rulemaking (``NPRM'') in CS Docket No. 95-184 
being adopted concurrently herewith.
    7. In addition, we determine that our current rules (as well as our 
revised rules described below) do not constitute an unconstitutional 
taking, because they implement a clear statutory directive and provide 
that, upon termination of service, the cable operator can receive just 
compensation for its home wiring or 

[[Page 6133]]
remove the wiring. Nor do we believe that our rules are rendered 
unconstitutional by the fact that the cable operator is deemed to have 
waived the availability of compensation if it fails to remove its home 
wiring within a given time period following termination of service. 
Compensation is available, under reasonable terms and conditions, if 
the cable operator chooses to take that option. See United States v. 
Locke, 471 U.S. 84, 107 (1985), which rejects a Fifth Amendment taking 
claim where the plaintiff failed to comply with a statutory requirement 
for filing a mining claim that would have indicated its intent to 
retain its property right. Texaco, Inc. v. Short notes that the U.S. 
Supreme Court has never required giving compensation to a private 
property owner who fails to take reasonable actions imposed by law for 
the consequences of his own neglect, 454 U.S. 516, 530 (1982). We note 
that the prescribed time period (formerly 30 days and, as described 
below, now seven business days) within which a cable operator may 
remove the cable home wiring it owns provides the operator with a 
reasonable opportunity to remove the wire if it so wishes.
    8. With regard to NYNEX's contention that consumer access to cable 
home wiring prior to termination of service would allow consumers to 
obtain broadband services from more than one multichannel video 
programming service provider simultaneously over one coaxial cable, it 
is our understanding that, while such simultaneous use may be possible 
in the laboratory, it is not technically or economically feasible in 
the marketplace at the present time. Apparently, for example, broadband 
networks are highly susceptible to signal impairments from outside 
sources, such as over-the-air broadcast signals, a danger that would be 
magnified significantly by the insertion of an additional broadband 
service within the wiring itself. Therefore, we deny NYNEX's petition 
as premature insofar as it seeks rules designed to allow simultaneous 
use by a broadband video competitor of excess capacity on cable home 
wiring. Furthermore, we note that the current cable wiring rules do not 
prohibit simultaneous use, regardless of whether the cable operator or 
the subscriber owns or controls the cable home wiring. Because we agree 
that simultaneous use of the same wire by competitors could promote 
competition and increase consumer choice, however, if simultaneous use 
of cable wiring becomes economically and technically feasible, the 
Commission may address any issues raised at that time.

B. Disposition of Cable Home Wiring Upon Termination of Service

1. Background
    9. The Cable Wiring Order provides that when a subscriber calls to 
voluntarily terminate cable service, the operator is required, if it 
proposes to remove the wiring, to inform the subscriber (a) that he or 
she may purchase the wire, and (b) what the cost per-foot charge is. If 
the subscriber declines to purchase the home wiring, the operator must 
remove it within 30 days or lose the right to remove it or restrict its 
use.
2. Petitions
    10. Some petitioners assert that cable operators may attempt to 
deter subscribers from switching to alternative multichannel video 
programming service providers by claiming that they intend to remove 
the cable wiring even if they intend to abandon it. They posit that the 
cable operator might falsely proclaim such an intent in order to 
prevent an alternative provider from using the wiring during the 30-day 
period afforded the operator to remove the wiring, and that since some 
subscribers might elect to remain with the incumbent cable operator 
rather than face such a choice, the current rules could defeat the 
purpose behind Section 16(d).
    11. WCA proposes that the Commission: (a) decrease the period 
following termination during which cable operators must remove cable 
home wiring from 30 days to seven days; (b) prohibit cable operators 
from terminating service until either the cable is removed or the 
seven-day period expires; and (c) establish procedures for the filing 
of complaints against cable operators that demonstrate a pattern of 
misrepresenting their intentions to remove wiring. Finally, WCA 
suggests that the ``appointment window'' rules adopted in MM Docket No. 
92-263 (Customer Service Standards) apply to appointments to remove 
wiring, and that a failure to comply would result in the automatic 
transfer of the wiring to the subscriber.
    12. In response, some cable companies argue that WCA's claim that 
operators will falsely state their intention to remove the wiring is 
``speculative,'' and, even if true, would not warrant action on 
reconsideration. They assert that WCA's concern that cable operators 
will discriminate against customers who choose an alternative service 
provider is unfounded because a cable operator cannot require any 
subscriber to purchase his home wiring. Moreover, NCTA argues that 
WCA's proposals are merely an attempt by alternative video programming 
service providers to gain a ``free ride'' off wiring installed by and 
belonging to the incumbent cable operator. As an alternative, NCTA 
states that alternative providers could offer to purchase the wiring 
from the incumbent operator, or at least offer to reimburse the 
subscriber if the subscriber chooses to purchase the wiring.
    13. In reply, WCA asserts that none of the responses addresses the 
fundamental unfairness of permitting cable operators to discriminate 
against subscribers who terminate service in favor of an alternative 
service provider.
    14. Ameritech proposes that ownership of cable home wiring should 
transfer to the subscriber upon termination. Ameritech proposes that, 
at a minimum, in cases of voluntary termination where a subscriber is 
notified of the right to purchase his or her home wiring and the 
subscriber exercises that right, constructive ownership should vest 
with the subscriber immediately and the subscriber should be free to 
authorize the connection of the wiring to a competing service provider.
3. Discussion
    15. As we noted in the Cable Wiring Order, the purpose of Section 
16(d) is to promote consumer choice and competition by permitting 
subscribers to avoid the disruption of having their home wiring removed 
upon voluntary termination, and to subsequently utilize that wiring for 
an alternative video programming service. While we believe that our 
current rules advance these goals, we believe that they do not address 
certain issues--such as when actual control of the home wiring 
transfers to the subscriber--that could cause needless consumer 
confusion and marketplace uncertainty. We therefore believe that the 
goals of Section 16(d) would be better served if our rules set forth a 
simple, clear process by which: (a) consumers can obtain, in a single 
contact, the information they need to decide whether they wish to 
purchase their home wiring upon termination; (b) consumers can 
thereafter quickly and easily use the wiring to connect to an 
alternative video programming service provider; and (c) cable 
operators' legitimate property rights are protected. Thus, we hereby 
amend our rules regarding the disposition of home wiring upon the 
voluntary termination of service as follows. 

[[Page 6134]]

    16. During the initial telephone call in which a subscriber advises 
the cable operator that he or she is voluntarily terminating service, 
the operator--if it owns and intends to remove the home wiring--must 
inform the subscriber of four things:
    (a) that the cable operator owns the home wiring--as discussed in 
the Cable Wiring Order, the record reveals that, in many circumstances, 
the subscriber already owns the home wiring at termination (e.g., where 
the operator has charged the subscriber for the wiring upon 
installation, has treated the wiring as belonging to the subscriber for 
tax purposes, or where state and/or local law treats cable home wiring 
as a fixture); it is the operator's responsibility to maintain adequate 
records to document its ownership;
    (b) that the cable operator intends to remove the home wiring;
    (c) that the subscriber has a right to purchase the home wiring; 
and
    (d) what the per-foot replacement cost and total charge for the 
wiring would be, including the replacement cost for any passive 
splitters attached to the wiring on the subscriber's side of the 
demarcation point--our current rules state that the operator must 
inform the subscriber of the per-foot replacement cost, and that its 
charge for the wiring may be based on ``a reasonable approximation'' of 
the length of cabling in the subscriber's premises. In the Cable Wiring 
Order (at n. 39), we stated that we expected the per foot charge to be 
based on the replacement cost of coaxial cable in the community; for 
instance, we noted that the record indicated that new coaxial cable was 
being sold for six cents per foot by District Cablevision in 
Washington, D.C. An operator has two options for making a ``reasonable 
approximation'' of the total charge during the contact terminating 
service. First, the operator can develop schedules to make such 
approximations based on readily available information, such as whether 
the subscriber lives in a single family dwelling or an apartment, the 
number of outlets installed, or the number of television sets in use. 
If the operator chooses to develop such schedules, it must place them 
in a public file and make them available for public inspection during 
regular business hours. In the alternative, the operator may maintain 
records reflecting the actual amount of home wiring installed on 
subscribers' premises, but this information must be available for 
calculating the total charge for the wiring during the initial phone 
call.
    Where an operator fails to adhere to the above procedures, it will 
be deemed to have relinquished immediately any and all ownership 
interests in the home wiring; thus, the operator will not be entitled 
to compensation for the wiring and may make no subsequent attempt to 
remove it or restrict its use. By referring to ``subscriber'' herein, 
we do not intend to prohibit a subscriber from delegating to an agent 
the task of terminating service and authorizing the purchase of home 
wiring on his or her behalf.
    17. If a subscriber voluntarily terminates cable service in person 
(i.e., at the cable operator's offices), the same procedures apply. If 
a subscriber requests termination in writing, it is the operator's 
responsibility--if it intends to remove the wiring--to make reasonable 
efforts to contact the subscriber prior to the date of service 
termination and provide the subscriber with the information set forth 
above.
    18. If the cable operator informs the subscriber as described 
above, and, at that point, the subscriber agrees to purchase the 
wiring, constructive ownership over the home wiring will transfer to 
the subscriber immediately, and the subscriber will be permitted to 
authorize a competing service provider to connect with and use the home 
wiring. Of course, the alternative video programming service provider 
is free to reimburse the subscriber for the cost of the home wiring. We 
believe that such a transfer of control presents no Fifth Amendment 
difficulties, since the operator will ultimately be compensated for its 
wiring (at which point actual ownership of the wiring will transfer to 
the subscriber). We are, however, cognizant of the potential for 
harmful signal leakage if this change-over is mishandled. Thus, where 
the incumbent cable operator has not yet terminated service and 
``capped off'' its line, the alternative video programming service 
provider will be responsible for ensuring that the incumbent's wiring 
is properly capped off in accordance with the Commission's signal 
leakage requirements. ``Capping off'' is a procedure whereby a 
terminating ``cap'' is placed over a wire to prevent potentially 
harmful signal leakage. If there is no alternative provider--i.e., if 
the subscriber is terminating service but will not be using the home 
wiring to receive another multichannel video service--the cable 
operator will remain responsible for properly capping off its own line. 
We require incumbent cable operators to take reasonable steps within 
their control to ensure that the alternative service provider has 
access to the home wiring at the demarcation point (e.g., by providing 
prompt access to the cable operator's lockbox where the placement of 
the lockbox impedes access to the demarcation point), and for 
incumbents and alternative multichannel video programming delivery 
service providers to minimize the potential for signal leakage, theft 
of service and unnecessary disruption of the consumer's premises.
    19. If, on the other hand, the subscriber declines to purchase the 
home wiring, the operator will have seven business days, rather than 
the current 30 days, to remove the wiring. If the operator does not 
remove the home wiring within this seven business day period, the 
operator may make no subsequent attempt to remove it or restrict its 
use. We believe that requiring subscribers to wait 30 days before 
learning whether the cable operator would remove its wiring causes 
needless uncertainty for the consumer and the possibility of a lengthy 
disruption in service. We also believe that, under normal operating 
conditions, it is not unreasonable to require cable operators to remove 
their wiring within seven business days. However, we decline at this 
time to apply the Commission's ``appointment window'' rules to 
appointments to remove wiring; we believe that WCA has not submitted 
sufficient evidence to demonstrate that such a change is necessary at 
this time. Given the uniform federal and industry standard on 
installations, we reject Time Warner's contention that a seven-day 
removal period is a forced, rather than a voluntary, abandonment of 
property. It is the operator's failure to act within a reasonable time 
after the subscriber requests that its wiring be removed--not the 
Commission's rule--that extinguishes the cable operator's rights. We 
also reject NCTA's assertion that a 30-day removal period is required 
to ensure that consumers have adequate time to decide whether or not to 
purchase the wiring. If the subscriber asks for more time to make a 
decision on whether to purchase the home wiring, the seven business-day 
period will not begin running until the subscriber declines to purchase 
the wiring. Until the subscriber contacts the operator with a decision, 
he or she may not use the wiring to connect to an alternative service 
provider.
    20. We believe that the above procedures may not be necessary in 
most circumstances. We understand that cable operators typically 
abandon cable home wiring because the cost and effort required to 
remove it generally outweigh its value. Accordingly, in most cases, the 
cable operator may simply remain silent on the subject of home wiring 
when the subscriber requests termination of service. If, for whatever 
reason, the cable operator does not 

[[Page 6135]]
discuss the disposition of the home wiring with the subscriber in 
accordance with the above procedures, the operator will be deemed to 
have relinquished immediately any and all ownership interests in the 
home wiring. Thus, the operator will not be entitled to compensation 
for the wiring and may make no subsequent attempt to remove it or 
restrict its use.
    21. While we acknowledge WCA's concerns that cable operators could 
misrepresent their intention to remove the wiring, or that operators 
may discriminate against subscribers who terminate service in favor of 
an alternative provider, there is no evidence in the record for us to 
conclude that these are significant problems. Moreover, we believe we 
have alleviated WCA's concern regarding subscribers being without 
service for up to 30 days by requiring cable operators to remove the 
home wiring within seven business days.

C. Demarcation Point for Multiple Dwelling Units With Non-Loop-Through 
Wiring

1. Background
    22. Section 16(d) of the 1992 Cable Act states that the Commission 
shall prescribe rules concerning cable wire ``within the premises of 
[the] subscriber.'' Section 76.5(ll) of the Commission's rules defines 
cable home wiring as the ``internal wiring contained within the 
premises of a subscriber which begins at the demarcation point.'' Under 
the current rules, the demarcation point is the point from which the 
customer has the right to purchase cable home wiring upon voluntary 
termination of service, the location from which the subscriber may 
control the internal home wiring if he or she owns it, and the point 
where a potential alternative multichannel video programming service 
provider can attach its wiring to the subscriber's wiring in order to 
provide service.
    23. The wiring in multiple dwelling unit buildings is generally in 
either a non-loop-through or loop-through configuration. In a non-loop-
through configuration, each subscriber has a dedicated line extending 
from a trunk or feeder line to the individual's premises. The point at 
which the drop meets the feeder line in multiple dwelling unit 
buildings is usually in a security box or utility closet. A loop-
through configuration is one in which a single cable provides service 
to a group of subscribers by being strung from one subscriber's unit to 
the next subscriber's unit in the same building.
2. Petitions
    24. Some commenters ask that the Commission reconsider its decision 
to locate the demarcation point for multiple dwelling units at or about 
twelve inches outside of where the cable enters a subscriber's 
individual dwelling unit. NYNEX states that the Commission's current 
rules are anti-competitive because they require an alternative cable 
service provider to install duplicate wire up to the twelve-inch point 
outside of where the wire enters the subscriber's premises, which would 
either be prohibitively expensive or impossible due to space 
limitations or the location of the wiring inside a wall in a building. 
Liberty asks that the demarcation point for multiple dwelling units be 
at the point outside a subscriber's premises and within the common 
areas of the multiple dwelling unit building where the individual 
subscriber's wires can be detached from the cable operator's common 
wires without harming the multiple dwelling unit and without 
interfering with the cable operator's provision of service to other 
residents in the building. Liberty contends that this would enhance 
competition by making it easier for the subscriber to switch from one 
alternative multichannel video programming service provider to another.
    25. On the other hand, cable companies oppose proposals to change 
the demarcation point for multiple dwelling units, arguing that the 
proposals do not definitively measure the exact point of demarcation 
and are contrary to the plain language of the statute. NCTA states that 
allowing a new service provider to go much beyond twelve inches invades 
the common wiring, which is the cable operator's property. Time Warner 
recommends that the most practical demarcation point in multiple 
dwelling units is the wall plate in each individual unit, not beyond 
twelve inches from where the wiring enters the individual dwelling 
unit.
3. Discussion
    26. We deny reconsideration of our rule setting the demarcation 
point for multiple dwelling units at or about twelve inches outside of 
where the cable wire enters the subscriber's dwelling unit. While the 
record in this proceeding does indicate that the Commission's current 
rules with regard to location of the demarcation point in multiple 
dwelling units may impede competition in the multichannel video 
programming delivery marketplace, the record is insufficient at this 
time to indicate whether a different demarcation point might better 
promote competition and consumer choice in the multichannel video 
programming delivery marketplace without an undue impact on competition 
in the market for other telecommunications services. We are concerned 
with more than simple competition in the broadband multichannel video 
programming market. We want to promote competition and consumer choice 
in all types of telecommunications markets through multiple 
technologies and services. The Commission therefore must consider broad 
telecommunications issues which extend beyond the 1992 Cable Act and 
the record in this proceeding before modifying the cable home wiring 
rules in ways that could have competitive implications for cable 
operators and other telecommunications service providers. Accordingly, 
while we deny reconsideration of our current definition of the cable 
demarcation point for multiple dwelling unit buildings, we believe that 
it would be appropriate to revisit this issue in a broader competitive 
context. We are, therefore, requesting comment on this demarcation 
point issue in our NPRM in CS Docket No. 95-184 being adopted 
concurrently herewith. We expect to act quickly in the NPRM proceeding 
to resolve the demarcation point issue.

D. Multiple Dwelling Unit Buildings With Loop-Through Wiring

1. Background
    27. In a loop-through cable wiring system, a single cable is used 
to provide service to either a portion of or an entire multiple 
dwelling unit building. Every subscriber on the loop is limited to 
receiving video services from the same provider; there is no capacity 
for individual choice. In the Cable Wiring Order, the Commission 
excluded multiple dwelling unit loop-through wiring from the cable home 
wiring rules, reasoning that applying our rules to loop-through wiring 
would give the building manager or the initial subscriber control over 
cable service for all subscribers in the loop.
2. Petitions
    28. Telephone companies ask that loop-through cable be included in 
the home wiring rules and controlled by the multiple dwelling unit 
building owner, and propose that the Commission require that loop-
through and other configurations based on common use of unpowered 
coaxial cable be eliminated in all future multiple dwelling unit 
installations of cable home wiring. In 

[[Page 6136]]
addition, Bell Atlantic urges the Commission to bar exclusive contracts 
between cable operators and the owners or managers of multiple dwelling 
unit buildings, because such contracts allegedly circumvent the 
Commission's cable home wiring rules and deny residents the ability to 
choose between competing services. While the current record does not 
contain sufficient evidence to bear out Bell Atlantic's assertions--and 
thus we do not address them further here--the parties are free to raise 
this issue in the context of the NPRM in CS Docket No. 95-184, adopted 
concurrently herewith.
    29. On the other hand, cable companies agree with the Commission's 
exclusion of multiple dwelling unit building loop-through 
configurations from the home wiring rules. Time Warner argues that the 
frequent turnover of multiple dwelling unit residents makes inclusion 
of loop-through multiple dwelling units impractical.
3. Discussion
    30. On reconsideration, we continue to exclude loop-through wiring 
from our cable home wiring rules. Inclusion of loop-through systems 
within these rules would be impractical, in part because establishing a 
separate demarcation point for each subscriber on a loop-through system 
and deciding how much wiring each subscriber should have the option to 
buy are not feasible. Furthermore, loop-through configurations, by 
their nature, preclude individual subscriber control, an essential 
element of the Commission's cable home wiring rules. Therefore, cable 
operators are not required to offer to sell loop-through wiring to 
subscribers upon termination of service, and no loop-through subscriber 
has the right to purchase loop-through home wiring. We will, however, 
consider and request comment in our Further Notice of Proposed 
Rulemaking (``FNPRM'') published simultaneously in this issue regarding 
Liberty's proposal that we allow the building owner to purchase the 
home wiring when all of the subscribers on a loop simultaneously decide 
to switch to an alternative video programming service provider. We will 
also request comment on NYNEX's and USTA's proposal that we prohibit 
future loop-through wiring installations and our authority, if any, to 
do so.

E. Inclusion of Passive Splitters Within Cable Home Wiring

1. Background and Petitions
    31. Section 76.5(ll) of the Commission's rules defines cable home 
wiring as the internal wiring contained within the subscriber's 
premises which begins at the demarcation point. The rule specifically 
excludes from cable home wiring any active elements such as amplifiers, 
converter or decoder boxes, or remote control units. In its petition 
for reconsideration, Liberty asks the Commission to ``clarify that 
cable home wiring includes passive ancillary equipment such as 
splitters and conduits or molding in which the cable is installed.'' 
Liberty asserts that including such passive equipment within the 
definition of cable home wiring will allow Liberty and other cable 
competitors to avoid problems that arise when space constraints 
prohibit the installation of multiple splitters or conduits to access 
an individual subscriber's wires. Cable companies oppose this request, 
contending that it was the specific intent of Congress to exclude any 
cable equipment other than actual wiring. Time Warner further contends 
that conduit and molding should be excluded from the Commission's 
definition of cable home wiring because they are not cable equipment, 
but rather the property of the premises owner. Time Warner states that, 
at a minimum, splitters, which are passive cable equipment, should only 
be considered part of the home wiring if located within, or up to 
twelve inches outside the subscriber's premises.
2. Discussion
    32. We grant Liberty's request that we include passive splitters 
within the definition of cable home wiring. Because passive splitters 
are a physically integral part of the home wiring, we believe that 
their exclusion could frustrate the purposes behind Section 16(d) of 
the 1992 Cable Act--i.e., to permit subscribers to avoid the disruption 
of having their home wiring removed, and to subsequently utilize the 
home wiring for an alternative video programming service. Therefore, 
operators will be required to offer to sell to a terminating subscriber 
any passive splitters attached to the home wiring on the subscriber's 
side of the demarcation point, at no more than the replacement cost of 
the splitters.
    33. However, we deny Liberty's request that other passive equipment 
be included within the cable home wiring definition. We believe that 
molding and conduit are not necessarily cable equipment and are often 
the property of the premises owner. In addition, we believe that, 
considering the wide variety of passive equipment and related property, 
it would be too burdensome to require cable operators to be prepared to 
quote the replacement cost of such equipment and property upon the 
subscriber's termination of service. Nevertheless, we understand 
Liberty's concern that cable operators not be permitted to use their 
ownership of other property relating to the cable home wiring to 
frustrate the purposes of our cable home wiring rules and Section 16(d) 
of the 1992 Cable Act. We will therefore prohibit cable operators from 
using any ownership interests they have in property located on the 
subscriber's side of the demarcation point, for example, cable molding 
or conduit, to prevent, impede, or in any way interfere with, a 
subscriber's right to use his or her home wiring to receive an 
alternative service.

III. Regulatory Flexibility Analysis

    34. Pursuant to the Regulatory Flexibility Act of 1980, 5 U.S.C. 
601-612, the Commission's final analysis with respect to the First 
Order on Reconsideration is as follows:
    35. Need and Purpose of this Action. The Commission amends its 
rules pertaining to cable home wiring to better effectuate the purposes 
of Section 16(d) of the Cable Television Consumer Protection and 
Competition Act of 1992, 47 U.S.C. 544(i) (1992).
    36. Summary of Issues Raised by the Public in response to the 
Initial Regulatory Flexibility Analysis. There were no comments 
submitted in response to the Initial Regulatory Flexibility Analysis.
    37. Significant Alternatives Considered and Rejected. Petitioners 
representing cable interests and competitive video providers did not 
submit comments regarding the administrative burden of the home wiring 
rules.

IV. Procedural Provisions

    38. Initial Paperwork Reduction Act of 1995 Analysis. This First 
Order on Reconsideration contains either a proposed or modified 
information collection. As part of our continuing effort to reduce 
paperwork burdens, we invite the general public and the Office of 
Management and Budget (``OMB'') to take this opportunity to comment on 
the information collections contained in this Order 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 the FNPRM; OMB 
comments are due 60 days from the date of publication of this Order 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, 

[[Page 6137]]
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.
    39. Ex parte Rules--Non-Restricted Proceeding. This is a non-
restricted notice and comment rulemaking proceeding. Ex parte 
presentations are permitted, except during the Sunshine Agenda period, 
provided that they are disclosed as provided in Commission's rules. See 
generally 47 C.F.R. Secs. 1.1202, 1.1203, and 1.1206(a).
    40. Written comments by the public on the proposed and/or modified 
information collections are due March 18, 1996. Written comments must 
be submitted by the Office of Management and Budget (OMB) on the 
proposed and/or modified information collections on or before 60 days 
after date of publication in the Federal Register. 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, 
N.W., Washington, DC 20554, or via the Internet to [email protected] and 
to Timothy Fain, OMB Desk Officer, 10236 NEOB, 725--17th Street, N.W., 
Washington, DC 20503 or via the Internet to [email protected].

V. Ordering Clauses

    41. Accordingly, it is ordered that the Petitions for 
Reconsideration in MM Docket No. 92-260 are granted in part and denied 
in part, as provided above herein.
    42. It is further ordered that Part 76 of the Commission's rules is 
hereby amended as shown below, effective upon approval by the Office of 
Management and Budget. The portions of the First Order on 
Reconsideration imposing information collections will not go into 
effect until approved by the Office of Management and Budget.
    43. It is further ordered that the Secretary shall send a copy of 
this First Order on Reconsideration to the Chief Counsel for Advocacy 
of the Small Business Administration in accordance with paragraph 
603(a) of the Regulatory Flexibility Act, Pub. L. No. 96-354, 94 Stat. 
1164, 5 U.S.C. 601 et seq. (1981).

List of Subjects in 47 CFR Part 76

    Cable television.

Federal Communications Commission.
William F. Caton,
Acting Secretary.

Revised Rules

    Part 76 of Title 47 of the Code of Federal Regulation is amended as 
follows:

PART 76--CABLE TELEVISION SERVICE

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

    Authority: Secs. 2, 3, 4, 301, 303, 307, 308, 309, 48 Stat., as 
amended 1064, 1065, 1066, 1081, 1082, 1084, 1085, 1101; 47 U.S.C. 
Sec. 152, 153, 154, 301, 303, 307, 308, 309; Secs. 612, 614-615, 
623, 632 as amended, 106 Stat. 1460, 47 U.S.C. 532; Sec. 632, as 
amended, 106 Stat. 1460; 47 U.S.C. 532, 533, 543, 552.

    2. Section 76.5 is amended by revising paragraph (ll) to read as 
follows:


Sec. 76.5  Definitions.

* * * * *
    (ll) Cable home wiring. The internal wiring contained within the 
premises of a subscriber which begins at the demarcation point. Cable 
home wiring includes passive splitters on the subscriber's side of the 
demarcation point, but does not include any active elements such as 
amplifiers, converter or decoder boxes, or remote control units.
* * * * *
    3. Section 76.802 is revised to read as follows:


Sec. 76.802  Disposition of cable home wiring.

    (a) Upon voluntary termination of cable service by a subscriber, a 
cable operator shall not remove the cable home wiring unless it gives 
the subscriber the opportunity to purchase the wiring at the 
replacement cost, and the subscriber declines. The cost is to be 
determined based on the replacement cost per foot of the cable home 
wiring multiplied by the length in feet of the cable home wiring, and 
the replacement cost of any passive splitters located on the 
subscriber's side of the demarcation point. If the subscriber declines 
to acquire the cable home wiring, the cable system operator must then 
remove it within seven (7) business days, under normal operating 
conditions, or make no subsequent attempt to remove it or to restrict 
its use.
    (b) During the initial telephone call in which a subscriber 
contacts a cable operator to voluntarily terminate cable service, the 
cable operator--if it owns and intends to remove the home wiring--must 
inform the subscriber:
    (1) That the cable operator owns the home wiring;
    (2) That the cable operator intends to remove the home wiring;
    (3) That the subscriber has the right to purchase the home wiring; 
and
    (4) What the per-foot replacement cost and total charge for the 
wiring would be (the total charge may be based on either the actual 
length of cable wiring and the actual number of passive splitters on 
the customer's side of the demarcation point, or a reasonable 
approximation thereof; in either event, the information necessary for 
calculating the total charge must be available for use during the 
initial phone call).
    (c) If the subscriber voluntarily terminates cable service in 
person, the procedures set forth in paragraph (b) of this section 
apply.
    (d) If the subscriber requests termination of cable service in 
writing, it is the operator's responsibility--if it wishes to remove 
the wiring--to make reasonable efforts to contact the subscriber prior 
to the date of service termination and follow the procedures set forth 
in paragraph (b) of this section.
    (e) If the cable operator fails to adhere to the procedures 
described in paragraph (b) of this section, it will be deemed to have 
relinquished immediately any and all ownership interests in the home 
wiring; thus, the operator will not be entitled to compensation for the 
wiring and shall make no subsequent attempt to remove it or restrict 
its use.
    (f) If the cable operator adheres to the procedures described in 
paragraph (b) of this section, and, at that point, the subscriber 
agrees to purchase the wiring, constructive ownership over the home 
wiring will transfer to the subscriber immediately, and the subscriber 
will be permitted to authorize a competing service provider to connect 
with and use the home wiring.
    (g) If the cable operator adheres to the procedures described in 
paragraph (b) of this section, and the subscriber asks for more time to 
make a decision regarding whether to purchase the home wiring, the 
seven (7) business day period described in paragraph (b) of this 
section will not begin running until the subscriber declines to 
purchase the wiring; in addition, the subscriber may not use the wiring 
to connect to an alternative service provider until the subscriber 
notifies the operator whether or not the subscriber wishes to purchase 
the wiring.
    (h) If an alternative video programming service provider connects 
its wiring to the home wiring before the incumbent cable operator has 
terminated service and has capped off its line to prevent signal 
leakage, the 

[[Page 6138]]
alternative video programming service provider shall be responsible for 
ensuring that the incumbent's wiring is properly capped off in 
accordance with the Commission's signal leakage requirements. See 
Subpart K (technical standards) of the Commission's Cable Television 
Service rules (47 CFR 76.605(a)(13) and 76.610 through 76.617).
    (i) Where the subscriber terminates cable service but will not be 
using the home wiring to receive another alternative video programming 
service, the cable operator shall properly cap off its own line in 
accordance with the Commission's signal leakage requirements. See 
Subpart K (technical standards) of the Commission's Cable Television 
Service rules (47 CFR 76.605(a)(13) and 76.610 through 76.617).
    (j) Cable operators are prohibited from using any ownership 
interests they may have in property located on the subscriber's side of 
the demarcation point, such as molding or conduit, to prevent, impede, 
or in any way interfere with, a subscriber's right to use his or her 
home wiring to receive an alternative service. In addition, incumbent 
cable operators must take reasonable steps within their control to 
ensure that an alternative service provider has access to the home 
wiring at the demarcation point. Cable operators and alternative 
multichannel video programming delivery service providers are required 
to minimize the potential for signal leakage in accordance with the 
guidelines set forth in 47 CFR 76.605(a)(13) and 76.610 through 76.617, 
theft of service and unnecessary disruption of the consumer's premises.
    (k) Definitions--Normal operating conditions--The term ``normal 
operating conditions'' shall have the same meaning as at 47 CFR 
76.309(c)(4)(ii).

[FR Doc. 96-3128 Filed 2-15-96; 8:45 am]
BILLING CODE 6712-01-P