United States: FCC Launches Remake Of Cable Leased Access Rules

In June 2018, as part of the FCC's Modernization of Media Regulation Initiative1, the Commission adopted a Further Notice of Proposed Rule Making (FNPRM) seeking to update the cable leased access rules.2 The FNPRM proposes vacating the 2008 Leased Access Order, which never went into effect because of a Stay Order by the US Court of Appeals for the Sixth Circuit.3 The FNPRM also asks for input on how the FCC should move forward in rewriting the leased access rules if the 2008 Leased Access Order is vacated.

Leased Access Rules Background

The 1984 Cable Act mandated that cable systems set aside a certain amount of channel capacity for commercial leased access and gave the FCC the authority to regulate leased access.4 In 1992 Congress extended the Commission's authority to set maximum rates for leased access channels on cable systems.5 Congress required that the price, terms, and conditions for leased access must be "sufficient to assure that such use will not adversely affect the operation, financial condition, or market development of the cable system."6

In February 2008 the Commission adopted the 2008 Leased Access Order (2008 Order), which altered the earlier adopted leased access rate formula and added customer service obligations that required cable operators to treat leased access programming the same as other cable programming.7 Among other things, the 2008 Order also changed the procedural rules in a leased access dispute, including expanding discovery and requiring the Media Bureau to resolve all disputes within 90 days of the close of the pleading cycle.8

There were multiple lawsuits challenging the 2008 Order, which were all consolidated into one case that remains in front of the Sixth Circuit. The Sixth Circuit issued a Stay Order9 in May 2008 that is still in effect because OMB disapproved the 2008 Order for failure to comply with the Paperwork Reduction Act (PRA) and asked the Sixth Circuit to hold the consolidated appeals in abeyance.10

Proposal to Vacate the 2008 Leased Access Order

The current FNPRM tentatively concludes that the Commission should vacate the 2008 Order including the Further Notice of Proposed Rule Making that was issued at the same time as that Order. The current FNPRM indicates that the FCC is concerned that the 2008 Order sets unreasonably low access rates and potentially is inconsistent with the PRA–both issues in the ongoing litigation. Additionally, the Commission believes vacating the Order is the best way to clear the slate so that it can modernize the leased access rules. This would leave the current leased access rules that were in effect before the 2008 Order in effect until the Commission can decide on final new rules.

The Commission seeks comment on this tentative conclusion. Specifically the FCC asks whether there is "any policy justification for not vacating the entire" 2008 Order or for maintaining any specific policy within that Order.

Requested Input on the Future of the Leased Access Rule

In addition to comment on the Commission's tentative conclusion on the 2008 Order, the Commission seeks input on the issues below.

  • The state of the leased access marketplace generally. How many leased access programmers are there, what portion of a cable system's programming is leased access, are the current rules effective, why or why not, to what extent do programmers rely on leased access versus other forms of distribution?
  • A proposed revision to Section 76.970 to extend the Bona Fide Requests limitation from only small operators to all leased access requests.
  • Whether the Commission should extend the time within which cable operators must provide prospective leased access programmers with the information specified in Section 76.970(i)(1) of the rules.11
  • Whether the Commission should allow cable operators to charge a small application fee or a deposit to programmers, something that is currently prohibited.
  • Whether the Commission should modify the procedures for addressing leased access disputes.

The comment period will end on July 30, 2018, and reply comments are due on or before August 13.12


1 See Commission Launches Modernization of Media Regulation Initiative, Public Notice, 32 FCC Rcd 4406 (2017) ("{A} review of {the FCC} rules applicable to media entities, including broadcasters, cable operators, and satellite television providers. The FCC's action invites public comment on which media rules should be modified or eliminated as unnecessary or burdensome.").

2 The FNPRM can be found at https://ecfsapi.fcc.gov/file/0608615311303/FCC-18-80A1.pdf.

3 Leased Commercial Access, Report and Order and Further Notice of Proposed Rulemaking, 23 FCC Rcd 2909 (2008), appeal pending, United Church of Christ v. FCC, No. 08-3245 (6th Cir.).

4 Cable Communications Policy Act of 1984, Pub. L. 98-549, § 2, 98 Stat. 2779, 2782; 47 U.S.C. § 532.

5 Implementation of Sections of the Cable Television Consumer Protection and Competition Act of 1992: Rate  Regulation, Report and Order and Further Notice of Proposed Rulemaking, 8 FCC Rcd 5631(1993); 47 U.S.C. § 532(c)(4)(A)(i).

6 47 U.S.C. § 532(c)(1).

7 2008 Leased Access Order at 2925, 2910.

8 Id. at 2931-32, 2940.

9 Order, United Church of Christ Office of Communications, Inc. et al. v. FCC, No. 08-3245 (and consolidated cases) (6th Cir., May 22, 2008) (Sixth Circuit Stay Order).

10 Notice of Office of Management and Budget Action, OMB Control No. 3060-0568 (Jul. 9, 2008) (OMBNotice).

11 Section 76.970(i)(1) currently requires cable system operators to provide prospective leased access programmers with the following information within 15 calendar days of the date on which a request for leased access information is made: (i) how much of the operator's leased access set-aside capacity is available; (ii) a complete schedule of the operator's full-time and part-time leased access rates; (iii) rates associated with technical and studio costs; and (iv) if specifically requested, a sample leased access contract.

12 Leased Commercial Access; Modernization of Media Regulation Initiative, 83 Fed. Reg. 30639-01 (June 29, 2018).

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