Complete text of FCC ruling of October, 2007 Jan 9. 2010 | Comments (0)
The following is the exact text of documents mailed to Tenants United For Fairness by the Federal Communications Commission:
"The FCC adopted a Report and Order (FCC 07-189) on October 31, 2007 banning the use of exclusivity clauses for the provision of video services to multiple dwelling units ("MDUs") or other real estate developments. The Order finds that nearly 30% of Americans live in MDUs and these numbers are growing.
With this proceeding, the Commission is taking another step to foster greater competition in the market for the delivery of multi-channel video programming. These rules will increase choice and competition for consumers residing in MDUs and other real estate developments. In this Order, the Commission prohibits the enforcement or execution of existing exclusivity clauses and the execution of new ones by MVPDs subject to section 628 of the Communications Act. Specifically the Order finds that:
- exclusivity clauses that bar competitive entry harm competition and broadband deployment and can insulate the incumbent MVPD from any need to improve its service.
- exclusivity clauses are widespread in agreements between MVPDs and MDU owners.
- incumbent cable operators have increased the use of exclusivity clauses in their agreements with MDU owners with the entry of LECs into the video marketplace.
- the use of exclusivity clauses in contracts for the provision of video services to MDUs constitutes an unfair method of competition or an unfair act or practice under Section 628(b).
The Commission also adopted a Further Notice of the Proposed Rulemaking (Further Notice) that seeks comment on whether we should take action to address exclusivity clauses entered into by DBS providers, private cable operators, and other MVPDs who are not subject to Section 628. The Further Notice also seeks comment on whether the Commission should prohibit exclusive marketing and bulk billing arrangements. (this is still pending)
Website:
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-08-1107A1.pdf Compliance Guide
Rules: Docket MB No. 07-51, FCC 07-189
This ruling became law on March 7, 2008.
What this means is that exclusive contracts for video services are now banned in multiple dwelling units (apartment buildings and/or other real estate developments). For example: a cable company can no longer make an exclusive contract with the apartment complex owners to provide the only services. Consumers now have a choice for these services provided the owner/building management allows other providers on the premises. (This does not apply to, and does not place any compliance requirements on, private cable operators or providers of direct broadcast satellite service.) Please note: consumers cannot arbitrarily choose another provider. They can solicit the owner/building management to allow another or an additional provider on the premises.
The Commission is saying such agreements between carriers and building owners hurt consumers and hinder competition..
- FCC has outlawed exclusive telecommunications contracts in residential multi-tenant environments (MTEs) - must contain two or more separate units.
- Exclusive commercial contracts have been excluded since 2001.
- Prohibited the enforcement of existing contracts that contain exclusivity provisions
- It immediately prohibits the enforcement of these contracts instead of phasing them out or waiting until the contracts expire.
- The order does not address exclusive marketing agreements or other agreements that give preference to a carrier but do not restrict the premises owner from permitting other providers access. [ TUFF comments: this seems to be the loophole that allows MDU owners to make "preferred provider" contracts with one carrier, then force the tenants to buy services from that carrier, whether they want it or not. The MDU owner typically tells the tenants that, yes, they can buy from company B if they wish, but first, the tenants must buy from company A or lose the lease on their apartments. ]
- Hotels and guests of other similar type establishments are not "tenants" under this rule and are not covered.
The Report and Order defines "MDUs" as:
For purposes of this Report and Order, we define the term "MDU" to include the kinds of dwellings that we have defined as being MDUs in past decisions implementing the Act. That is, MDUs include apartment, cooperative, and condominium buildings. For purposes of this Report and Order, we adopt this definition but expand it to include other centrally managed real estate developments. Thus, the term MDUs, for purposes of this Report and Order, also includes gated communities, mobile home parks, garden apartments, and other centrally managed residential real estate developments. All of these are collections of private individual households with residents remaining for lengthy, indefinite periods of time, each in a dwelling space that is distinctly separate but shares some common spaces requiring central management.
For purposes of this proceeding, MDUs do not include time share units, academic campuses and dormitories, military bases, hotels, rooming houses, jails, prisons, halfway houses, hospitals, nursing and other assisted living places, and other group quarters characterized by institutional living, high transience and, in some cases, a high need for security.. These latter institutions do not have most of the key defining attributes of MDUs that we have just described, including voluntary long-term residency and significant control by the resident over uses of the private dwelling space. These attributes give the resident a strong interest in making his or her own choice of a MVPD provider and thus warrant regulatory action to preserve the resident's ability to do so."--here ends the FCC document.