[Federal Register Volume 69, Number 18 (Wednesday, January 28, 2004)]
[Rules and Regulations]
[Pages 4081-4083]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-1836]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 76

[CS Docket No. 97-80; PP Docket No. 00-67; FCC 03-329]


Commercial Availability of Navigation Devices and Compatibility 
Between Cable Systems and Consumer Electronics Equipment

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this document, the Commission revised the definition of 
unencrypted broadcast television adopted in its earlier Second Report 
and Order and Second Further Notice of Proposed Rulemaking in this 
proceeding. This revision clarifies a potential conflict between our 
stated intent and the scope of the rules. This action is taken to 
further the digital television transition and the commercial 
availability of navigation devices pursuant to section 629 of the 
Communications Act.

DATES: Effective February 27, 2004.

FOR FURTHER INFORMATION CONTACT: Susan Mort, [email protected], (202) 
418-1043.

SUPPLEMENTARY INFORMATION: This is a summary of the Federal 
Communications Commission's Order on Reconsideration, FCC 03-329, 
adopted on December 19, 2003, and released on December 23, 2003. The 
full text of this document is available for inspection and copying 
during normal business hours in the FCC Reference Center, 445 12th 
Street, SW., Washington, DC 20554. The complete text may be purchased 
from the Commission's copy contractor, Qualex International, 445 12th 
Street, SW., Room CY-B402, Washington, DC 20554. The full text may also 
be downloaded at: http://www.fcc.gov. Alternative formats are available 
to persons with disabilities by contacting Brian Millin at (202) 418-
7426 or TTY (202) 418-7365 or at [email protected].

Summary of the Order on Reconsideration

    1. In our recent Second Report and Order and Second Further Notice 
of Proposed Rulemaking in this proceeding, we adopted encoding rules 
that included, inter alia, a prohibition on the down resolution of 
unencrypted broadcast programming and caps on the level of copy 
protection that may apply to various categories of MVPD programming. 
The copy protection caps included a prohibition on the imposition of 
copy restrictions on unencrypted broadcast television. Our stated goal 
in adopting these encoding rules was to strike a measured balance 
between the rights of content owners and the home viewing expectations 
of consumers, while ensuring competitive parity among MVPDs.
    2. Following release of the Second Report and Order and Second 
Further Notice of Proposed Rulemaking, a potential conflict between our 
stated intent and the scope of the rules became apparent. The 
limitation of the encoding rules for broadcast television programming 
to ``Unencrypted Broadcast Television'' could inadvertently be 
interpreted to create a competitive disparity in so far as certain 
MVPDs encrypt their broadcast signals while others do not. The 
resulting imbalance could also negatively impact consumers who would 
otherwise expect to have the same viewing and recording capabilities 
for broadcast television programming regardless of distribution 
platform. To prevent this unintended consequence, by our own motion we 
revise the definition of Unencrypted Broadcast Television in our 
encoding rules as set forth herein.
    3. Paperwork Reduction Act of 1995 Analysis. This Order on 
Reconsideration does not contain information collection(s) subject to 
the Paperwork Reduction Act of 1995 (PRA), Pub. L. 104-13.
    4. Regulatory Flexibility Act: As required by the Regulatory 
Flexibility Act, the Commission has prepared a Supplemental Final 
Regulatory Flexibility Analysis (``Supplemental FRFA'') relating to 
this Order on Reconsideration. The Supplemental FRFA is set forth 
within.
    5. Ordering Clauses: Pursuant to the authority contained in 
sections 1, 4(i) and (j), 303, 403, 405, 601, 624A and 629 of the 
Communications Act of 1934, 47 U.S.C 151, 154(i) and (j), 303, 403, 
405, 521, 544a and 549, the Commission's rules are hereby amended as 
set forth herein, and shall become effective February 27, 2004.

Supplemental Final Regulatory Flexibility Analysis

    6. As required by the Regulatory Flexibility Act of 1980, as 
amended (``RFA'') an Initial Regulatory Flexibility Analysis (``IRFA'') 
was incorporated in the Further Notice of Proposed Rulemaking 
(``FNPRM'') in this proceeding. The Commission sought written public 
comment on the proposals in the FNPRM, including comment on the IRFA. 
Based upon the comments in response to the FNPRM

[[Page 4082]]

and the IRFA, the Commission included a Final Regulatory Flexibility 
Analysis (``FRFA'') in the Second Report and Order and Second Further 
Notice of Proposed Rulemaking (``Digital Cable Compatibility Order and 
FNPRM'') in this proceeding. In this Order on Reconsideration, the 
Commission is, on its own motion, amending the rules in a manner that 
may affect small entities. Accordingly, this Supplemental Regulatory 
Flexibility Analysis (``Supplemental FRFA'') addresses those amendments 
and conforms to the RFA.
    7. Need for, and Objectives of, the Order on Reconsideration. In 
the Digital Cable Compatibility Order and FNPRM, the Commission adopted 
regulations setting a cable compatibility standard for an integrated, 
unidirectional digital cable television receiver, as well as for other 
unidirectional digital cable products. These regulations include, inter 
alia, technical standards, a labeling regime and encoding rules for 
audiovisual content delivered by multichannel video programming 
distributors (``MVPD''). The objective of the final rules is to 
facilitate the DTV transition and ensure parity among MVPDs. However, 
the encoding rule adopted in the Digital Cable Compatibility Order and 
FNPRM prohibiting MVPDs from encoding unencrypted broadcast television 
with copy restrictions or to trigger down resolution may be susceptible 
to different interpretations and could create an imbalance between 
different MVPDs in so far as certain providers typically encrypt the 
broadcast television signals that they retransmit whereas others do not 
or cannot. This Order on Reconsideration amends the encoding rules to 
cover all broadcast television programming that is unencrypted when 
originally broadcast, regardless of whether or not they are carried in 
encrypted form by an MVPD.
    8. Summary of Significant Issues Raised in Response to the FRFA. No 
parties have addressed the FRFA in any subsequent filings.
    9. Description and Estimate of the Number of Small Entities to 
Which the Proposed Rules Will Apply. The RFA directs the Commission to 
provide a description of and, where feasible, an estimate of the number 
of small entities that will be affected by the proposed rules. The RFA 
generally defines the term ``small entity'' as encompassing the terms 
``small business,'' ``small organization,'' and ``small governmental 
entity.'' In addition, the term ``small Business'' has the same meaning 
as the term ``small business concern'' under the Small Business Act. A 
small business concern is one which: (1) Is independently owned and 
operated; (2) is not dominant in its field of operation; and (3) 
satisfies any additional criteria established by the Small Business 
Administration (``SBA'').
    10. As noted, a FRFA was incorporated into the Digital Cable 
Compatibility Order and FNPRM. In that analysis, the Commission 
described in detail the various small business entities that may be 
affected by the final rules. Those entities consist of: television 
broadcasting stations, cable and other program distribution (which 
includes, among others, cable operators, direct broadcast satellite 
services, home satellite dish services, multipoint distribution 
services, multichannel multipoint distribution service, Instructional 
Television Fixed Service, local multipoint distribution service, 
satellite master antenna television systems, and open video systems), 
electronics equipment manufacturers, and computer manufacturers. In 
this present Order on Reconsideration, the Commission is amending the 
final rules adopted in the Digital Cable Compatibility Order and FNPRM 
on its own motion. In this Supplemental FRFA, we incorporate by 
reference the description and estimate of the number of small entities 
from the FRFA in this proceeding.
    11. Description of Projected Reporting, Recordkeeping and other 
Compliance Requirements. Among the final rules adopted in the Digital 
Cable Compatibility Order and FNPRM, is a prohibition on all MVPDs from 
encoding unencrypted broadcast television programming to activate copy 
restrictions or down-resolution. This Order on Reconsideration revises 
this prohibition to encompass all broadcast television programming that 
is unencrypted when broadcast, regardless of the form in which it is 
carried by an MVPD.
    12. Steps Taken to Minimize Significant Impact on Small Entities, 
and Significant Alternatives Considered. The RFA requires an agency to 
describe any significant alternatives that it has considered in 
reaching its proposed approach, which may include the following four 
alternatives (among others): (1) The establishment of differing 
compliance or reporting requirements or timetables that take into 
account the resources available to small entities; (2) the 
clarification, consolidation, or simplification of compliance or 
reporting requirements under the rule for small entities; (3) the use 
of performance, rather than design, standards; and (4) an exemption 
from coverage of the rule, or any part thereof, for small entities.
    13. In the Digital Cable Compatibility Order and FNPRM, we 
concluded that the encoding prohibitions on selectable output controls 
and the down-resolution of unencrypted broadcast programming would 
largely impact upon the DBS industry, which is primarily composed of 
large entities. Similarly, while we concluded that the caps on copy 
protection would affect all MVPDs, we believed they would not have a 
negative impact on small entities. We do not believe that our revision 
of the encoding rules in this Order on Reconsideration changes our 
earlier conclusions.
    14. Federal Rules Which Duplicate, Overlap, or Conflict with the 
Commission's Proposals. None.
    15. Report to Congress: The Commission will send a copy of the 
Order on Reconsideration, including this Supplemental FRFA, in a report 
to be sent to Congress pursuant to the Congressional Review Act. In 
addition, the Commission will send a copy of the Order on 
Reconsideration, including this Supplemental FRFA, to the Chief Counsel 
for Advocacy of the SBA. A copy of the Order on Reconsideration and 
Supplemental FRFA (or summaries thereof) will also be published in the 
Federal Register.

List of Subjects in 47 CFR Part 76

    Cable television, Incorporation by reference, Recordings, 
Television.

    Federal Communications Commission.
Marlene H. Dortch,
Secretary.

0
For the reasons discussed in the preamble, the Federal Communications 
Commission amends 47 CFR part 76 as follows:

PART 76--MULTICHANNEL VIDEO AND CABLE TELEVISION SERVICE

0
1. The authority for part 76 continues to read as follows:

    Authority: 47 U.S.C. 151, 152, 153, 154, 301, 302a, 303, 303a, 
307, 308, 309, 312, 317, 325, 338, 339, 503, 521, 522, 531, 532, 
533, 534, 535, 536, 537, 543, 544, 544a, 545, 548, 549, 552, 554, 
556, 558, 560, 561, 571, 572, and 573.

0
2. Revise paragraph (s) of Sec. 76.1902 to read as follows:


Sec. 76.1902  Definitions.

* * * * *
    (s) Unencrypted broadcast television means the retransmission by a 
covered entity of any service, program, or schedule or group of 
programs originally broadcast in the clear without use of a 
commercially-adopted access control method by a terrestrial television 
broadcast station regardless of whether such covered entity employs an

[[Page 4083]]

access control method as a part of its retransmission.
* * * * *
[FR Doc. 04-1836 Filed 1-27-04; 8:45 am]
BILLING CODE 6712-01-P