FCC Record, Volume 27, No. 5, Pages 3728 to 4696, April 9 - April 27, 2012 Page: 3,766
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B. The "Substantial Overlap" Issue
6. In its 1999 Cable Reform Order interpreting the LEC test, the Commission stated that, for
a cable operator to be subject to LEC effective competition, the LEC's service area must substantially
overlap the incumbent cable operator's franchise area.24 The goal of Congress was "to restrain cable rates
and stimulate quality cable services."25 and clarified that "once the LECs competitive presence is
sufficient to achieve these goals, even if the LEC's buildout or roll out is not complete, the intent of the
effective competition test has been met. On the other hand, service offered only ... to a geographically
limited market within the franchise area does not satisfy the test."26 The issue of substantial overlap is not
one of first impression. Many of our decisions under the LEC effective competition test have involved a
LEC that has begun service in a relatively small part of the incumbent cable operator's franchise area with
expansion obligations requiring the LEC to serve within a few years, most, or all, of the incumbent's
franchise area.27 Our decision deregulating Boston in 2001 was such a decision.28 That decision relied
heavily on the City, in exchange for granting RCN a franchise, imposing specific obligations requiring
RCN to build out its system to serve all of Boston. In particular, the Bureau Order noted that under its
agreement with the City, RCN is required "to serve approximately 90 [percent] of Boston within 3 1/2
years of signing the franchise agreement, and complete its buildout to every Boston neighborhood six
years after signing the franchise agreement." 29 The Commission, in affirming the Bureau Order, further
relied on the City's buildout obligations imposed on RCN, holding that "RCN intends to build out its
system to serve the entire city of Boston, albeit at a slower pace than it originally intended."30
7. Several years ago, however, apparently due to a lack of capital, RCN's buildout halted
and the City released it from any further buildout obligations. At present, RCN has neither an obligation
to expand the geographic scope of its system nor any prospect of doing so.' The City states that "RCN ..
pass[es] only a small percentage of the residences in the City" but gives no numerical estimate of homes
passed.32 Comcast obtained a statement from RCN to the effect that RCN now passes 32.1 percent of the
households in Boston.33 The City does not dispute this number, and we accept it.
8. In Mediacom Delaware LLC, we found LEC effective competition to exist where the
LEC's system covered approximately one third of the territory served by the petitioning cable operator.34
24 Cable Reform Order, 14 FCC Red at 5303, 10.
'2 Id. at 5304, 11.
26Id. at 5304, !I 11-12.
27 See, e.g., Cablevision Systems Corp., 25 FCC Red 4953, 4955, 7 (2010); CSC TKR, Inc., 25 FCC Red 4948,
4951, 10-11 (2010); Comcast Cable Commc ni, LLC, 23 FCC Red 10073, 10077, 11 (2008); Bright House
Networks, LLC, 22 FCC Rcd 12905, 12906-07, 7 (2007).
28 Bureau Order., 16 FCC Red at 14061, 15.
29 Id, 16 FCC Red at 14061. 15; id. at 14062, 17 ("we note the aggressive buildout requirement and liquidated
damage provisions of the franchise").
o' Commission Order, 17 FCC Red at 4778, 14 (application for review denied).
31 Petition at 11-13.
321d. at 19.
3 Opposition at 8 (using a household number from the 2010 Census).
*4 Mediacom Delaware LLC, 26 FCC Red 3668, 3672, 14 (2011) ("Verizon's system covers approximately one
third of the territory served by Mediacom. We conclude that Verizon's service area is a substantial portion of
Mediacom's franchise area."). The Delaware measurement was of territory and the present one is of households, but
we do not consider this difference significant to our analysis in this case.
Federal Communications Commission
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United States. Federal Communications Commission. FCC Record, Volume 27, No. 5, Pages 3728 to 4696, April 9 - April 27, 2012, book, April 2012; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc102307/m1/55/: accessed May 25, 2017), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.