[Federal Register Volume 61, Number 52 (Friday, March 15, 1996)]
[Rules and Regulations]
[Pages 10691-10692]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-6206]



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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 73

[FCC 96-91]


Implementation of Sections 202(c)(1) and 202(e) of the 
Telecommunications Act of 1996 (National Broadcast Television Ownership 
and Dual Network Operations)

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: On February 8, 1996, President Clinton signed into law the 
Telecommunications Act of 1996 (Telecom Act).1 Section 202(c)(1) 
of the Telecom Act directs the Commission to revise its Rules regarding 
the national television station multiple ownership rules. Section 
202(e) of the Telecom Act directs us to revise the Commission's Rules 
with respect to dual networking operations. With this Order, we conform 
our rules to these particular provisions of the Telecom Act.

    \1\ Pub. L. 104-104, 110 Stat. 56 (1996).
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EFFECTIVE DATE: March 15, 1996.

FOR FURTHER INFORMATION CONTACT: Alan Aronowitz, Mass Media Bureau, 
Policy and Rules Division, Legal Branch, (202) 418-2130, or via the 
Internet at [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Order, 
FCC 96-91, adopted March 7, 1996 and released March 8, 1996. The full 
text of this Commission decision is available for inspection and 
copying during normal business hours in the FCC Dockets Branch (Room 
239), 1919 M Street, NW., Washington, DC. The complete text of this 
decision may also be purchased from the Commission's copy contractor, 
International Transcription Services, (202) 857-3800, 2100 M Street, 
NW., Suite 140, Washington, DC 20037.

Synopsis of Order

    1. National Ownership Limitations. Currently, 
Sec. 73.3555(e)(1)(ii) through (iii), (2) and (3) of the Commission's 
Rules set forth the rules and operative definitions regarding national 
ownership limitations applicable to commercial television stations. The 
rule prohibits entities from having an attributable ownership or other 
cognizable interest in more than 12 such stations, except that such an 
interest in two additional stations is permitted, for a total of 14 
stations, if these additional stations are minority-controlled. The 
rule also prohibits an entity from having an attributable ownership or 
other cognizable interest in a station if it would result in that 
entity having such an interest in television stations with an aggregate 
national audience reach exceeding 25 percent (an additional 5 percent 
reach is permitted, for a total of 30 percent, if it is derived from 
minority-controlled stations). For purposes of calculating this 
aggregate audience reach under the rules, UHF stations are attributed 
with only 50 percent of their audience reach (the ``UHF 
discount''),2 and stations which are primarily satellite 
operations are generally not counted (the ``satellite 
exception'').3

    \2\ 47 CFR 73.3555(e)(3)(i).
    \3\ 47 CFR 73.3555(e)(3)(ii).
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    2. Section 202(c)(1) of the Telecom Act directs the Commission to 
``modify its rules for multiple ownership set forth in Sec. 73.3555 of 
its regulations * * *.
    (A) by eliminating the restrictions on the number of television 
stations that a person or entity may directly or indirectly own, 
operate, or control, or have a cognizable interest in, nationwide; and
    (B) by increasing the national audience reach limitation for 
television stations to 35 percent.''

Section 73.3555(e) of the Commission's Rules will be revised to reflect 
the changes directed by section 202(c)(1) of the Telecom Act, as set 
forth below.
    3. The Telecom Act is silent with respect to the UHF discount and 
the satellite station exception, both of which are incorporated in the 
definition of ``national audience reach'' set forth in 
Sec. 73.3555(e)(3). The UHF discount and satellite exception are 
matters presently under consideration in the Commission's outstanding 
proceeding reviewing its television broadcast ownership rules,4 
and any rule modifications with respect to these matters will be 
addressed, as appropriate, in that proceeding. In calculating the 
national audience reach in the interim, therefore, the UHF discount and 
the satellite exception, as set forth in our current rules, will 
continue to apply. However, any entity which acquires stations during 
this interim period and which complies with the 35 percent audience 
reach limitation only by virtue of one or both of these two provisions 
will be subject to the outcome in the pending television

[[Page 10692]]
ownership proceeding concerning these issues. We accordingly retain and 
redesignate Sec. 73.3555(e)(3) (i) and (ii). The remainder of the 
definitions set forth in paragraph (e)(3) (defining ``minority'' and 
``minority-controlled'') will be removed to conform to the rule changes 
mandated by the Telecom Act.

    \4\ See TV Ownership Further Notice, 60 FR 6490 (February 2, 
1995).
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    4. Dual Network Operations. Section 73.658(g) of the Commission's 
Rules, commonly known as the ``dual network'' rule, currently prohibits 
television stations from affiliating with a network organization that 
maintains more than one network of television stations unless the 
networks are not operated simultaneously or unless there is no 
substantial overlap in the territory served by the group of stations 
comprising each such network. For purposes of the current rule, a 
network organization is any entity that simultaneously broadcasts an 
identical program to two or more interconnected stations.
    5. Section 202(e) of the Telecom Act instructs the Commission to 
``revise Section 73.658(g) of its regulations * * * to permit a 
television broadcast station to affiliate with a person or entity that 
maintains 2 or more networks of television broadcast stations unless 
such dual or multiple networks are composed of--
    (1) Two or more persons or entities that, on the date of enactment 
of the Telecommunications Act of 1996, are `networks' as defined in 
section 73.3613(a)(1) of the Commission's regulations [in essence, this 
refers to the NBC, CBS, ABC, and Fox television networks] * * *; or
    (2) any network described in paragraph 1 and an English-language 
program distribution service that, on such date, provides 4 or more 
hours of programming per week on a national basis pursuant to network 
affiliation arrangements with local television broadcast stations in 
markets reaching more than 75 percent of television homes (as measured 
by a national ratings service) [in essence, this refers to the UPN or 
WB television networks].''

Section 73.658(g) of the Commission's Rules will be modified to conform 
to section 202(e) of the Telecom Act, as set forth below.

Administrative Matters

    6. We are revising these rules without providing prior public 
notice and an opportunity for comment because the rules being modified 
are mandated by the applicable provisions of the Telecom Act. We find 
that notice and comment procedures are unnecessary, and that this 
action therefore falls within the ``good cause'' exception of the 
Administrative Procedure Act (``APA'').5 The rule changes adopted 
in this Order do not involve discretionary action on the part of the 
Commission. Rather, they simply implement provisions of the Telecom Act 
that direct the Commission to revise its rules according to specific 
terms set forth in the legislation.

    \5\ See 5 U.S.C. 553(b)(B) (notice requirements inapplicable 
``when the agency for good cause finds * * * that notice and public 
procedure thereon are impracticable, unnecessary, or contrary to the 
public interest'').
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Ordering Clause

    7. Accordingly, IT IS ORDERED that pursuant to section 202(c)(1) 
and 202(e) of the Telecommunications Act of 1996, and to section 4(i) 
and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 
154(i), 303(r), part 73 of the Commission's Rules, 47 CFR part 73, is 
amended as set forth below. The rules are effective upon publication of 
this Order in the Federal Register.6

    \6\ See id. at section 553(d) (rules that relieve a restriction 
may be effective less than 30 days after publication in the Federal 
Register).
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List of Subjects in 47 CFR Part 73

    Radio broadcasting.

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

Rule Changes

    Part 73 of title 47 of the Code of Federal Regulations is amended 
as follows:

PART 73--RADIO BROADCAST SERVICES

    1. The authority citation for part 73 continues to read as follows:

    Authority: 47 U.S.C. 154, 303, 334.

    2. Section 73.658(g) is revised to read as follows:


Sec. 73.658  Affiliation agreements and network program practices; 
territorial exclusivity in non-network program arrangements.

* * * * *
    (g) Dual network operation. A television broadcast station may 
affiliate with a person or entity that maintains two or more networks 
of television broadcast stations unless such dual or multiple networks 
are composed of:
    (1) Two or more persons or entities that, on February 8, 1996, were 
``networks.'' For the purposes of this paragraph, the term network 
means any person, entity, or corporation which offers an interconnected 
program service on a regular basis for 15 or more hours per week to at 
least 25 affiliated television licensees in 10 or more states; and/or 
any person, entity, or corporation controlling, controlled by, or under 
common control with such person, entity, or corporation; or
    (2) Any network described in paragraph (g)(1) of this section and 
an English-language program distribution service that, on February 8, 
1996, provided four or more hours of programming per week on a national 
basis pursuant to network affiliation arrangements with local 
television broadcast stations in markets reaching more than 75 percent 
of television homes (as measured by a national ratings service).
* * * * *
    3. Section 73.3555(e) is revised to read as follows:


Sec. 73.3555  Multiple ownership.

* * * * *
    (e)(1) National television multiple ownership rule. No license for 
a commercial TV broadcast station shall be granted, transferred or 
assigned to any party (including all parties under common control) if 
the grant, transfer or assignment of such license would result in such 
party or any of its stockholders, partners, members, officers or 
directors, directly or indirectly, owning, operating or controlling, or 
having a cognizable interest in TV stations which have an aggregate 
national audience reach exceeding thirty-five (35) percent.
    (2) For purposes of this paragraph (e):
    (i) National audience reach means the total number of television 
households in the Arbitron Area of Dominant Influence (ADI) markets in 
which the relevant stations are located divided by the total national 
television households as measured by ADI data at the time of a grant, 
transfer or assignment of a license. For purposes of making this 
calculation, UHF television stations shall be attributed with 50 
percent of the television households in their ADI market. Where the 
relevant application forms require a showing with respect to audience 
reach and the application relates to an area where Arbitron ADI market 
data are unavailable, then the applicant shall make a showing as to the 
number of television households in its market. Upon such a showing, the 
Commission shall make a determination as to the appropriate audience 
reach to be attributed to the applicant.
    (ii) TV broadcast station or TV station excludes stations which are 
primarily satellite operations.
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[FR Doc. 96-6206 Filed 3-14-96; 8:45 am]
BILLING CODE 6712-01-P