Broadcast Television National Ownership Rules

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 73

[MM Docket Nos. 96-222, 91-221, and 87-8; FCC 96-437]

Broadcast Television National Ownership Rules

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: This Notice of Proposed Rule Making makes several proposals

regarding how to calculate a group television station owner's aggregate

national audience reach to determine compliance with the Commission's

35% national audience cap. This action is needed to best implement the

national ownership provisions of the Telecommunications Act of 1996.

DATES: Comments are due by February 7, 1997, and reply comments are due

by March 7, 1997.

ADDRESSES: Federal Communications Commission, Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT:

Paul R. Gordon, Mass Media Bureau, (202) 418-2130.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice

of Proposed Rule Making in MM Docket Nos. 96-222, 91-221, and 87-7,

adopted November 5, 1996, and released November 7, 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.,

[[Page 66988]]

Washington, DC. The complete text of this decision may 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 Notice of Proposed Rule Making

1. In 1995, the Commission released a Further Notice of Proposed

Rulemaking in MM Docket Nos. 87-8 and 91-221 (TV Ownership Further

NPRM) seeking comment on a variety of issues relating to the national

broadcast television multiple ownership rules.\1\ After comments were

submitted, Congress enacted the Telecommunications Act of 1996 (the

``1996 Act''). The 1996 Act set specific national ownership audience

reach limitations and eliminated our prior national numerical cap on

station ownership. However, it did not address the issue of the

measurement of audience reach for the purposes of the new limits.

Therefore, we seek to update the record on measuring national

television audience reach for purposes of the new national ownership

limit in three areas, described in detail below: (1) whether to

continue to disregard satellite station ownership in measuring national

ownership (the ``satellite exemption''); (2) whether and how to

incorporate local marketing agreements (``LMAs'') into the calculation

of national audience reach; and (3) whether to replace our use of

Arbitron's Areas of Dominant Influence (``ADIs'') to define geographic

television markets with the use of Nielsen's Designated Market Areas

(``DMAs''). We defer until 1998 consideration of another issue: whether

to continue to attribute UHF facilities with only one half the audience

reach of VHF stations in the same market (the ``UHF discount'').

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\1\ Further NPRM in MM Docket Nos. 87-8 and 91-221, 60 FR 6490,

February 2, 1995 (TV Ownership Further NPRM). Those aspects of the

TV Ownership proceeding that address national ownership issues are

now incorporated into this new docket. The TV Ownership Further NPRM

also addressed issues relating to the Commission's local television

ownership rules, which are the subject of a companion proceeding.

Second Further Notice of Proposed Rulemaking in MM Docket Nos. 91-

221 and 87-7, also being published today (Local TV Second Further

NPRM).

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Background

2. Before passage of the 1996 Act, Sections 73.3555(e)(1)(ii) and

(iii) generally prohibited entities from having an attributable

ownership or other cognizable interest in more than 12 such stations.

Sections 73.3555(e)(2)(i) and (ii) generally prohibited from an entity

from having an attributable ownership or other cognizable interest in a

station if it would result in that entity's having such an interest in

television stations with an aggregate national audience reach exceeding

25%. The rule defined a station's audience reach as consisting of the

total number of television households within the television market for

that station, rather than its actual viewing audience. The television

market, in turn, was defined as the Area of Dominant Influence (ADI)

that Arbitron, a commercial audience-rating service, used in analyzing

broadcast television station competition. For purposes of calculating

this aggregate audience reach under the rules, UHF stations were

attributed with only 50% of the audience within their ADI (the UHF

discount), and satellite stations generally were not counted at all

(the satellite exemption).

3. Section 202(c)(1) of the 1996 Act directed the Commission to

``modify its rules for multiple ownership set forth in Section 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%.''

Accordingly, the Commission released an Order revising Section

73.3555(e) of the Rules to reflect these two changes.\2\

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\2\ Order, FCC 96-91 (released March 8, 1996), 61 FR 10691,

March 15, 1996 (1996 National TV Ownership Order).

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4. The 1996 Act is silent with respect to the UHF discount and the

satellite station exemption, both of which remain part of the

definitions set forth in Section 73.3555(e)(2) for calculating national

audience reach. We stated in the 1996 National TV Ownership Order that

issues related to these rule provisions would be addressed separately,

and that the existing UHF discount and the satellite exemption would

remain in effect until such time as we could review and resolve these

matters. We added that any entity subsequently acquiring stations

before these issues were resolved and which complied with the 35%

audience reach limitation only by virtue of either or both of these two

provisions would be subject to the outcome of the pending national

television ownership proceeding, the relevant issues of which have been

incorporated into this proceeding.

5. We consequently seek to update the record with regard to the

satellite exemption, and we also seek comment on two other issues not

addressed in the 1996 Act but which bear on our implementation and

enforcement of the new 35% reach limit: the treatment of LMAs and the

use of geographic market definitions for purposes of calculating

national audience reach.

The Rules

The UHF Discount

6. When the Commission adopted the UHF discount in 1985, it stated

that the inherent physical nature of the UHF signal created competitive

disadvantages at that time sufficient to warrant accommodation in the

national multiple ownership rules. However, as explained below, we are

postponing any decision as to whether to modify or eliminate the UHF

discount until the next biennial review of the broadcast ownership

rules.

7. We have observed in other contexts that the UHF disparity has

been ameliorated over the years. This is due in part to improved

television receiver designs, as well as the fact that many households

received broadcast channels via cable rather than by over-the-air

transmission. In the TV Ownership Further NPRM, we suggested that

extensive cable carriage of UHF stations, might have reduced the UHF

disparity.

8. Nearly all of the commenters addressing the issue oppose

eliminating the UHF discount. As they correctly point out,

approximately 4% of potential viewers are not passed by cable and

approximately 34.8% of television households do not subscribe to cable.

Such viewers continue to rely on over-the-air reception of both VHF and

UHF signals and, accordingly, continue to be subject to the UHF signal

disadvantage. Moreover, the Supreme Court is considering the

constitutionality of the must-carry rules. If the rules are determined

to be unconstitutional, and if many UHF stations are as a result

dropped by cable systems, then the increased pass rate and penetration

rate of cable television could become much less relevant to the

magnitude of the UHF disparity.

9. Given these circumstances, and based on the current record, we

have decided to defer any further review of this policy to the biennial

review of our broadcast ownership rules that we will conduct in 1998

pursuant to the 1996 Act. We should be in a better position in 1998 to

assess the continuing growth over the next several years in the

availability and penetration of cable and other multichannel video

programming

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suppliers and how this affects the continuing need for the UHF

discount. In addition, by 1998 the Commission will have adopted a

digital television (DTV) Table of Allotments, and the implementation of

this new technology will have proceeded further. Our review of the UHF

discount as part of the biennial ownership review would take into

account these developments, as both digital technology and the

allotment of DTV channels may eventually diminish to a great extent the

physical distinction between the UHF and VHF signals.We also invite

comment on whether we should impose in the interim any supplementary

limitation on national audience reach.

The Satellite Exemption

10. A television satellite is a full-power terrestrial broadcast

station that retransmits all or part of the programming of a parent

station that is often commonly owned. The Commission currently exempts

TV satellites from the national multiple ownership rules. In 1991, in a

proceeding addressing the Commission's overall regulation of satellite

stations, we abolished both the 5% limit on the amount of local

programming that a satellite can originate and the use of that 5%

benchmark for determining whether a station is still a satellite.\3\

Accordingly, because satellites were no longer limited as to the amount

of local programming they could originate, we also sought comment on

whether to continue to exempt satellites from the national ownership

rule.\4\

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\3\ Report and Order in MM Docket No. 87-8, 56 FR 31876, July

11, 1991 (TV Satellite R&O) (recon. pending).

\4\ Second Further Notice of Proposed Rulemaking in MM Docket

87-8, 56 FR 42306, August 27, 1991.

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11. A satellite may operate in the same market as its parent

station intramarket, or the two stations may operate in different

markets. We tentatively conclude that, with respect to the intramarket

situation, the public interest would be served by retaining the

satellite exemption. However, we believe that satellite stations should

be counted for purposes of the national ownership limits where they are

in a separate market from the parent station.

12. In intramarket situations, we see no reason to count that

market twice for the purposes of determining national audience

reach.\5\ The national multiple ownership rule, as amended by the 1996

Act, is concerned with potential audience rather than actual

viewership. Nor are we concerned with the particular number of

television stations owned. Indeed, the 1996 Act eliminated the

numerical station limitations formerly in the rule and now focuses

solely on national audience reach. In this regard, if a licensee

acquires a satellite television station in a market within which it

already operates a station, it has not extended its audience reach in

that television market for purposes of the national audience reach

limit; the television households in that market are already counted,

given the existence of the licensee's non-satellite station. This is

true whether or not the satellite station is originating local

programming. We seek comment on our proposal not to ``double count'' a

satellite and its parent station in these circumstances.

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\5\ As noted above, any satellite issues that might arise in the

context of the local duopoly rule will be addressed in the local

ownership proceeding.

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13. Notably, the above analysis would apply regardless of whether

one of the commonly owned stations is a satellite station, as it is

based solely on the fact that both stations operate in the same

television market. Thus, we extend our proposal to incorporate all

commonly owned television stations within a market. Specifically, when

two commonly owned stations are in the same market by virtue of a

waiver of the local television duopoly rule, we propose not to ``double

count'' the television households within that market for national

ownership purposes. Similarly, should we ultimately authorize common

ownership of more than one television station in a market in the

pending local ownership proceeding, we intend not to double count the

television households within that market for the purposes of

calculating a licensee's national audience reach. We seek comment on

this proposal. We also seek comment on how this proposal would affect

programming diversity and opportunities for small stations, or stations

owned by women and minorities.

14. Turning to parent-satellite combinations in separate markets,

we note that this type of satellite provides programming to a

population that otherwise would receive no programming at all over the

air from either the parent or the satellite station, and the licensee

of the parent station controls the programming of both the parent and

the satellite station. Consequently, the actual over-the-air audience

reach of the parent station's licensee is in fact expanded into another

market by the audience reach of the satellite station. While the

exemption may have encouraged the operation of satellite stations in

the past, any such incentive has been minimized by the elimination of

the 12-station limit. Previously, without the exemption, a satellite in

an isolated area would have been regarded as being no different from a

full-service station in a heavily populated area for the purpose of

counting the number of stations toward the 12-station limit. However,

as noted above, satellite stations typically operate in areas that are

likely to provide television broadcasters relatively little opportunity

for growth and profit when compared with larger markets. Under these

circumstances, if there had been no satellite exemption, a licensee

would have had a disincentive to operate a satellite station, and many

rural areas would likely not be receiving service from satellite

stations that are operating today. Thus, the exemption allowed group

owners to acquire and operate satellite stations without concern for

the national numerical station limits.

15. Under the new national ownership rule, however, the equal

treatment of satellite stations for the purposes of national ownership

would no longer provide a disincentive to satellite operation. Because

a satellite generally serves a sparsely populated area that is

underserved, the population of the entire market in which the satellite

is located should add relatively little to a group owner's total

national audience reach. Thus, we tentatively conclude that the

satellite exemption in cases where the parent and satellite station

serve separate markets is no longer necessary to encourage the

operation of satellite stations. We seek comment on our tentative

conclusion to eliminate the satellite exemption for parent/satellite

combinations in different markets.

Local Marketing Agreements

16. The question of double-counting is also raised when a licensee

programs another television station in the same market through an LMA.

An LMA is a type of joint venture that generally involves the sale by a

licensee of discrete blocks of time to a broker who then supplies the

programming to fill that time and sells the commercial spot

announcements to support it. Such agreements enable separately owned

stations to function cooperatively via joint advertising, shared

technical facilities (including shared production facilities), and

joint programming arrangements.

17. We request comment specifically addressing how best to treat

LMAs when calculating an entity's national audience reach. We stress

that in this NPRM we are not addressing the permissibility and

attribution of LMAs under our local ownership rules, as

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these issues are currently being analyzed in our companion local

ownership and attribution rule makings.

18. The double-counting issue arises when one licensee operates as

a broker to another in the same television market pursuant to an LMA;

in this situation it reaches the same audience twice, through two

different television stations. We have incorporated the general issue

of whether television LMAs should be attributed in the Attribution

Further NPRM and tentatively conclude in that proceeding that an LMA of

another television station in the same market for more than 15% of the

brokered station's weekly broadcast hours should generally be

attributed for purposes of our ownership rules. However, as discussed

above in the context of satellite stations, the national television

ownership rule now focuses solely on national audience reach and we see

no reason to double-count a market for purposes of calculating this

reach. We seek comment on this tentative conclusion. We seek comment in

particular on the effect of double counting for small stations, or for

stations owned by women or minorities.

Market Definition

19. The 1996 Act left unchanged a provision in our television

ownership rule that defines national audience reach as 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.

20. As we stated in the 1995 Television Ownership Further NPRM,

Arbitron no longer updates its county-by-county determinations of each

broadcast station's ADI. Accordingly, we proposed to use Designated

Market Areas (DMAs) as compiled by A.C. Nielsen--another commercial

ratings service--where we previously relied on ADIs, noting that they

are analytically similar. Moreover, in our companion Local TV Second

Further NPRM, we state that the DMA provides, as a general matter, a

reasonable proxy of a television station's geographic market.

Consequently, we tentatively conclude in that proceeding that local

television markets should be on the basis of DMAs, although for

purposes of the local ownership rules, we further propose that we

should supplement the DMA test with a Grade A signal contour criterion.

21. While the general issue of how to delineate the geographic

scope of local markets was addressed by several commenters in response

to the 1995 Television Ownership Further NPRM, we observe that it was

not in the context of calculating a broadcaster's national audience

reach. In the absence of any comment, we tentatively conclude that we

should adopt the proposal to use DMAs for calculating national audience

reach.

22. In some instances the use of DMAs instead of ADIs may lead to

small variations in the audience reach calculation of some stations.

This is due to the fact that in some instances Arbitron and Nielsen

define markets somewhat differently. For example, Hagerstown, Maryland,

constitutes its own Arbitron ADI, while it is part of the Washington,

DC DMA established by Nielsen. While we recognize that these variations

occur, we believe they will have a minor effect on the calculation of

an entity's national ownership reach. We invite parties to comment on

this assessment.

Implementation and Transition Issues

23. In this NPRM, we propose to modify the satellite exemption, but

we defer consideration of the UHF discount until our biennial review in

1998. We seek comment regarding the implementation of any changes we

may make to the satellite exemption. We also seek to determine whether

a group station owner complying with the 35% limit only by virtue of

the UHF discount could nevertheless have so high a national audience

reach that it would not be in the public interest and, if so, how this

matter is best addressed. We note that part of the 1996 National TV

Ownership Order concerned subsequent station acquisitions (i.e., UHF or

satellite station acquisitions made after March 15, 1996, the effective

date of that Order) that comply with the 35% audience reach limitation

only by virtue of either or both of the UHF discount or the satellite

exemption. We advised broadcasters that such transactions would be

subject to the ultimate resolution of this rulemaking. We now ask

commenters to address how best to effectuate that approach.

Conclusion

24. The Telecommunications Act of 1996 established new, relaxed

limitations on national multiple ownership. We have issued this NPRM to

update the record on subsidiary matters not addressed in the Act which

determine how to calculate the new 35% national audience reach cap--

whether to continue the satellite exemption, as well as issues related

to LMAs and market definition. In seeking comment on these issues, we

wish to ensure that the new national audience reach cap is effectively

implementated so as to promote our competition and diversity goals. We

also seek comment on the transaction issues raised by any rule changes

we may adopt in this proceeding.

Administrative Matters

25. Pursuant to applicable procedures set forth in Sections 1.415

and 1.419 of the Commission's Rules, 47 CFR Secs. 1.415 and 1.419,

interested parties may file comments on or before February 7, 1997, and

reply comments on or before March 7, 1997. To file formally in this

proceeding, you must file an original plus four copies of all comments,

reply comments, and supporting comments. If you want each Commissioner

to receive a copy of your comments, you must file an original plus nine

copies. You should send comments and reply comments to Office of the

Secretary, Federal Communications Commission, Washington, D.C. 20554.

Comments and reply comments will be available for public inspection

during regular business hours in the FCC Reference Center (Room 239),

1919 M Street, N.W., Washington, D.C. 20554.

26. This is a non-restricted notice and comment rulemaking

proceeding. Ex parte presentations are permitted, except during the

Sunshine Agenda period, provided they are disclosed as provided in the

Commission Rules. See generally 47 CFR Sections 1.1202, 1.1203, and

1.1206(a).

Initial Paperwork Reduction Act of 1995 Analysis

The rules proposed herein have been analyzed with respect to the

Paperwork Reduction Act of 1995 and found to contain no new or modified

form, information collection and/or record keeping, labeling,

disclosure or record retention requirements. These proposed rules would

not increase or decrease burden hours imposed on the public.

Initial Regulatory Flexibility Analysis

As required by Section 603 of the Regulatory Flexibility Act, 5

U.S.C. Sec. 603, the Commission is incorporating an Initial Regulatory

Flexibility Analysis (IRFA) of the expected impact on small entities of

the policies and proposals in this Notice of Proposed Rulemaking

(NPRM).\6\ Written public comments concerning the effect of the

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proposals in the NPRM, including the IRFA, on small businesses are

requested. Comments must be identified as responses to the IRFA and

must be filed by the deadlines for the submission of comments in this

proceeding. The Secretary shall send a copy of this NPRM, including the

IRFA, to the Chief Counsel for Advocacy of the Small Business

Administration in accordance with paragraph 603(a) of the Regulatory

Flexibility Act.\7\

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\6\ An IRFA pursuant to Public Law Notice 96-354, Sec. 603, 94

Stat. 1165 (1980) was incorporated into both the Notice of Proposed

Rulemaking and Further Notice of Proposed Rulemaking in MM Docket

Nos. 91-221 and 87-8, the national ownership aspects of which have

been incorporated into this proceeding.

\7\ Public Law Notice 96-354, 94 Stat. 1164, 5 U.S.C. Sec. 601

et seq. (1981), as amended.

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Reason for NPRM

After the issuance of the TV Ownership Further NPRM in 1995, the

Telecommunications Act of 1996 \8\ was signed into law. Accordingly,

this NPRM seeks comment on how the Telecommunications Act of 1996

should affect our ongoing analysis of the national broadcast television

ownership rules.

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\8\ Public Law Notice 104-104, Sec. 101, 110 Stat. 56 (1996)

(Telecommunications Act).

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Objectives

This NPRM seeks comment on modifying the national broadcast

television ownership rules to achieve our competition and diversity

goals in light of the passage of the Telecommunications Act. Pursuant

to the Act, a licensee may not own a station if it would result in that

broadcaster's owning television stations with an aggregate national

audience reach exceeding 35%. A station's audience reach has

traditionally been defined for national ownership purposes as the total

number of television households within the station's Area of Dominant

Influence (ADI), an area used by Arbitron to analyze broadcast

television station competition. While the Telecommunications Act set

the 35% national audience reach limit, it did not address how to

actually measure audience reach. This NPRM seeks comment on issues

relating to such measurement.

First, we propose to eliminate the satellite exemption to the

national ownership rule, by which a television satellite station is not

considered when calculating a broadcaster's national audience reach, in

cases where the satellite operates in a different market from its

parent. The exemption was intended to encourage the operation of

satellite stations. Without the exemption, a satellite would have

brought a group station owner closer to the 12-station cap (which was

eliminated by the Telecommunications Act) just like the acquisition of

any other station, thereby creating a disincentive for satellite

operation. However, because the 12-station cap has been eliminated and

because incorporation of a satellite's local market should add

relatively little to a group owner's total national audience reach, the

disincentive to satellite operation has likely been removed. When the

satellite and the parent are in the same market, however, we propose to

retain the exemption, because multiple counting of the same audience

would appear unrelated to Congress's concern with national audience

reach.

Second, the NPRM turns to LMAs, noting that the issue is relevant

only if the LMA is deemed attributable, a question being resolved in

the pending attribution proceeding. This NPRM proposes that local

marketing agreements (LMAs) not be counted for the purposes of

calculating an entity's national audience reach. When one licensee

operates as a broker to another in the same television market pursuant

to an LMA, it reaches the same audience twice, through two different

television stations, and it does not allow the brokering station's

licensee to reach any audience that it is not already reaching. Thus,

it appears that Congress's concern with national audience reach, as

opposed to numerical station limits, is not implicated.

Finally, the NPRM proposes to utilize Designated Market Areas

(DMAs), the areas used by Nielsen to analyze broadcast television

station competition, instead of ADIs when calculating the number of TV

households in a station's market. Arbitron no longer updates its

county-by-county determinations of each broadcast station's ADI.

However, DMAs are generally similar to ADIs and are still updated

regularly. Any effects caused by this modification of the rule are

expected to be de minimis.

Legal Basis

Authority for the actions proposed in this NPRM may be found in

Sections 4(i) and 303(r) of the Communications Act of 1934, as amended,

47 U.S.C. Secs. 154(i), 303(r).

Recording, Recordkeeping, and Other Compliance Requirements

No new recording, recordkeeping or other compliance requirements

are proposed.

Federal Rules That Overlap, Duplicate, or Conflict with the Proposed

Rules

The Commission's broadcast-newspaper, television broadcast-cable,

local radio ownership, and local television ownership rules also

promote the same goals as the rules discussed in this item. However,

they do not overlap, duplicate or conflict with the proposed rules.

Description and Estimate of the Number of Small Entities To Which the

Rules Would Apply

The Small Business Administration (SBA) defines a television

broadcasting station that is independently owned and operated, is not

dominant in its field of operation, and has no more than $10.5 million

in annual receipts as a small business.\9\ Television broadcasting

stations consist of establishments primarily engaged in broadcasting

visual programs by television to the public, except cable and other pay

television services.\10\ Included in this industry are commercial,

religious, educational, and other television stations.\11\ Also

included are establishments primarily engaged in television

broadcasting and which produce taped television program materials.\12\

Separate establishments primarily engaged in producing taped television

program materials are classified under another SIC number.\13\ There

were 1,509 television stations operating in the nation in 1992.\14\

That number has remained fairly constant, as indicated by the

approximately 1,550 operating television stations in August, 1996.\15\

In 1992,\16\ there were 1,155 television station establishments that

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produced less than $10.0 million in revenue.\17\

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\9\ 13 CFR Sec. 121.201, Standard Industrial Code (SIC) 4833

(1996). For purposes of this Notice of Proposed Rulemaking, we are

utilizing the SBA's definition in determining the number of small

businesses to which the proposed rules would apply, but we reserve

the right to adopt a more suitable definition of ``small business''

as applied to radio and television broadcast stations and to

consider further the issue of the number of small entities that are

television broadcasters in the future. See Report and Order in MM

Docket No. 93-48 (Children's Educational and Informational

Programming), 61 FR 43981 (August 27, 1996), citing 5 U.S.C.

Sec. 601(3).

\10\ Economics and Statistics Administration, Bureau of Census,

U.S. Dep't of Commerce, 1992 Census of Transportation,

Communications and Utilities, Establishment and Firm Size, Series

UC92-S-1, Appendix A-9 (1995).

\11\ Id.

\12\ Id.

\13\ Id.

\14\ FCC News Release No. 31327, January 13, 1993; Economics and

Statistics Administration, Bureau of Census, U.S. Dep't of Commerce,

supra note 71, Appendix A-9.

\15\ Federal Communications Commission News Release 64958,

September 6, 1996.

\16\ Census for communications establishments are performed

every five years, during years that end with a ``2'' or ``7''. See

Economics and Statistics Administration, Bureau of Census, U.S.

Dep't of Commerce, 1992 Census of Transportation, Communications and

Utilities, Establishment and Firm Size, Series UC92-S-1, Appendix A-

9, III (1995).

\17\ The amount of $10 million was used to estimate the number

of small business establishments because the relevant Census

categories stopped at $9,999,999 and began at $10,000,000. No

category for $10.5 million existed. Thus, the number is as accurate

as it is possible to calculate with the available information.

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We recognize that the proposed rules may also affect minority and

women-owned stations, some of which may be small entities. In 1995,

minorities owned and controlled 37 (3.0%) of 1,221 commercial

television stations.\18\ According to the U.S. Bureau of the Census,

1987 women owned and controlled 27 (1.9%) of 1,342 commercial and

noncommercial television stations in the United States.\19\ We

recognize that the numbers of minority and women broadcast owners may

have changed due to an increase in license transfers and assignments

since the passage of the Telecommunications Act of 1996. We seek

comment on the current numbers of minority and women owned broadcast

properties and the numbers of these that qualify as small entities. To

assist us with our responsibilities under the Regulatory Flexibility

Act, we specifically request comments concerning our assessment of the

number of small businesses that will be impacted by this rule making

proceeding, the type or form of impact, and the advantages and

disadvantages of the impact.

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\18\ Minority Commercial Broadcast Ownership in the United

States, U.S. Dep't of Commerce, National Telecommunications and

Information Administration, The Minority Telecommunications

Development Program (MTDP) (April 1996). MTDP considers minority

ownership as ownership of more than 50% of the broadcast

corporation's stock, have voting control in a broadcast partnership,

or own a broadcasting property as an individual proprietor. Id. The

minority groups included in this report are Black, Hispanic, Asian,

and Native American.

\19\ See Comments of American Women in Radio and Television,

Inc. in MM Docket No. 94-149 and MM Docket No. 91-140, at 4 n.4

(filed May 17, 1995), citing 1987 Economic Censuses, Women-Owned

Business, WB87-1, U.S. Dep't of Commerce, Bureau of the Census,

August 1990 (based on 1987 Census). After the 1987 Census report,

the Census Bureau did not provide data by particular communications

services (four-digit Standard Industrial Classification (SIC) Code),

but rather by the general two-digit SIC Code for communications

(#48). Consequently, since 1987, the U.S. Census Bureau has not

updated data on ownership of broadcast facilities by women, nor does

the FCC collect such data. However, we sought comment on whether the

Annual Ownership Report Form 323 should be amended to include

information on the gender and race of broadcast license owners.

Policies and Rules Regarding Minority and Female Ownership of mass

Media Facilities, Notice of Proposed Rulemaking, 10 FCC Rcd 2788

(1995), 60 FR 6068, (February 1, 1995).

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Any Significant Alternatives Minimizing the Impact on Small Entities

and Consistent with the Stated Objectives

The proposed rules and policies would apply to full power broadcast

television licensees, permittees, and potential licensees. We have

proposed to not double count commonly owned stations in the same market

and LMAs for the purpose of calculating a licensee's national audience

reach. We also propose to eliminate the satellite exemption of

licensees that operate a satellite station in a separate market from

the parent station. We do not have sufficient information, at this

time, to reach a tentative conclusion about the effect of these

proposed rules, and seek comment on the potential significant economic

impact of these proposals on a substantial number of small stations. We

urge parties to support their comments with specific evidence and

analysis.

We tentatively conclude that there is not a significant economic

impact regarding our proposal to use Designated Market Areas (DMAs)

compiled by A.C. Nielsen instead of Arbitron to calculate national

audience reach. A.C. Nielsen, like Arbitron, is another commercial

ratings service, and they are analytically similar.

List of Subjects in 47 CFR Part 73

Television broadcasting.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

[FR Doc. 96-32139 Filed 12-18-96; 8:45 am]

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