Cable Home Wiring

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.

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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

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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

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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,

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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

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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