INSIDE WIRING PRIMER

Letters to pursue FCC MDU Inside Wiring Rules

KEY DEFINITIONS:

1. MDU Owner: The entity that owns or controls the common areas of a multiple dwelling unit building (e.g., a landlord in a rental building or a condominium association).
   
   
2. Home run wiring: The wiring extending from the demarcation point of 12 inches outside of an individual residential unit to the point at which the wiring first becomes dedicated to that individual residential unit (i.e., where it joins at the junction box, pedestal or riser cable). In a loop system configuration, it means the individual loop. It excludes any active elements such as amplifiers and riser cable. Any removal of amplifiers or other active devices can only occur if an equivalent replacement can be easily reattached.
   
   
3. Cable home wiring or home wiring: The internal wiring contained within the premises of a subscriber which begins at the 12 inch demarcation point, excluding any active elements such as amplifiers, converter or decoder boxes, or remote control units. If the 12 inch demarcation point is "physically inaccessible," the demarcation point will be moved to the point at which it first becomes physically accessible outside of the subscriber's unit.
   
   + The demarcation point is physically inaccessible if it would require significant modification or damage of preexisting structural elements (e.g., embedded in brick, metal conduit or cinder blocks), and would add significantly to the physical difficulty and/or cost of accessing the home wiring; wiring enclosed within hallway molding is not physically inaccessible.
   
   
4. Loop-through cable wiring: A single cable used to provide service to either a portion of or an entire MDU such that every subscriber on the loop is limited to receiving services from a single provider.
   
   
5. Building-by-building disposition: Where the MDU owner decides to convert an entire building or complex of buildings to a new video service provider.
   
   
6. Unit-by-unit disposition: Where an MDU owner permits two or more video service providers to compete for subscribers at the unit level within a building or complex of buildings.
   
   
7. Incumbent operator: The operator servicing the building at the time of the MDU owner notice of termination or of multiuse competition. While typically this will be a franchised cable operator, the FCC rules are applicable to all video service providers.

BUILDING-BY-BUILDING DISPOSITION

1. General Application: Applies only when the incumbent operator owns the home run wiring and does not (or will not at the conclusion of the notice period) have a legally enforceable right to remain on the premises. FCC presumption that building-by-building procedural mechanisms will apply unless and until the incumbent obtains a court ruling or an injunction enjoining its displacement during the 45-day period following the initial notice by the MDU owner.
2. Procedures for building-by-building disposition:
   • MDU owner notifies incumbent operator in writing that service will be terminated in 90 days
   • incumbent operator notifies MDU owner in writing within next 30 days whether operator intends to (a) remove the wiring and restore the MDU within 30 days of the end of the 90 day period or of actual service termination whichever occurs first; (b) abandon and not disable the wiring at the end of the 90 day period or the date of actual service termination; or (c) sell the wiring to the MDU owner
   • If the election is (a) or (b), and if the incumbent operator intends to terminate service in advance of the 90 day period, the operator must provide the precise date of service termination to the MDU owner in writing at the time of the election
   • If the election is (c), the MDU owner decides whether it wishes to purchase the home run wiring and if so, negotiations over the price proceed over the next 30 days (no default price or formula was established); the MDU owner may allow the competitor to purchase the home run wiring and handle the negotiations instead
   • If price agreement cannot be reached within that 30 days, the incumbent operator must re-elect between (a) or (b) or (d) to submit the price determination to binding arbitration by an independent expert; if (a) or (b) the precise date of service termination must be supplied in writing at the time of this election if not the close of the 90 day period
   • Binding arbitration procedures: parties have seven days to agree on independent expert or to each designate an independent expert who together will pick a third expert within an additional seven days; the expert(s) must assess a reasonable price for the home run wiring by the close of the 90 day period; any refusal by MDU owner or alternative provider to submit to binding arbitration will release the incumbent operator from having to comply with rules
   
   
   
3. "Penalty": If the incumbent operator fails to comply with any of the procedural deadlines, the home run wiring will be automatically deemed abandoned at the end of the 90 day period. The FCC declined to establish a monetary penalty at this time against incumbent operators who elect but then fail to remove the home run wiring. The FCC also declined to require an operator to post a performance bond prior to any removal.
   
   
4. Overall rule for seamless transition: The parties must cooperate to avoid service disruption to subscribers. In such fashion, it is expected that the incumbent operator cannot establish an actual service termination date in advance of the close of the 90 day period that would leave subscribers without cable service for longer than a few hours.

UNIT-BY-UNIT DISPOSITION

1. General Application: Applies only when the incumbent operator owns the home run wiring in an MDU and does not (or will not at the close of the notice period) have a legally enforceable right to keep a particular home run wire dedicated to a particular unit. FCC presumption that unit-by-unit procedural mechanisms will apply unless and until the incumbent obtains a court ruling or an injunction enjoining its displacement during the 45-day period following the initial notice by the MDU owner.
   Exception: Presumption will not apply where a state's highest court has previously found under a state mandatory access statute that the incumbent has an enforceable right to maintain home run wiring on the premises. Burden shifts to competitor or MDU owner to obtain a judicial ruling to the contrary in order for procedural mechanism to go forward.
   
   
2. Procedures for unit-by-unit disposition: -- MDU owner provides written notice to incumbent operator 60 days in advance of when competitor intends to access home run wiring for those units who wish competitor=s service -- 30 days later, incumbent operator must provide MDU owner with a single written election intended to address all of the incumbent=s home run wiring dedicated to individual subscribers who later choose the competitor=s service; election is between (a), (b) and (c) options as described above in building-by-building disposition; this election is then implemented each time an individual subscriber switches service to the competitor -- if the competitor is to purchase the wiring instead of the MDU owner (assumes the incumbent elects option (c)), then the competitor must make a similar election between the same options within the same 30 day period; this is to govern the wiring disposition when an individual subscriber switches back to the incumbent -- if the incumbent or competitor or both elects (c), a 30 day period of time for negotiation occurs; the parties may negotiate an up-front one-time lump sum payment for all the units or a unit-by-unit payment to occur at the time of each switch -- in the absence of an agreement on purchase price for either or both operators electing (c), the affected operator must then elect between options (a), (b) or (d) binding arbitration; the arbitration procedures proceed similar to the procedures for the building-by-building disposition except that the expert(s) must access the price for the wiring within 14 days; if that time period occurs after the close of the 60 day period, subscribers can be switched over to the new provider subject to the price to be established by the expert; again, any refusal to participate in the arbitration process will release the incumbent from any compliance with the rules -- regardless of which option is chosen, the election will be carried out (by either the incumbent or the competitor if a switch back) only if the subscriber (or the new provider as the subscriber=s agent) notifies its current provider orally or in writing that it not only wants to terminate service but wants to allow the alternative provider to use the wiring to provide it with service [this does not alter incumbent=s obligations for disposition of cable home wiring, see below] -- e.g., if subscriber is vacating the premises as opposed to switching service providers, the election need not be carried out; however, if subsequent tenant requests service switch, election must be implemented at that time -- if option (a), removal of the home run wiring for that unit must occur within 7 days or within 7 days of the actual service termination date chosen by the subscriber or the wiring is deemed abandoned and useable by the competitor -- if option (b), abandonment will be deemed effective upon actual service termination or upon the subscriber=s requested date of termination, whichever occurs first -- if option (c), the sale will become effective upon actual service termination or upon the subscriber=s requested date of termination, whichever occurs first -- if the incumbent intends to terminate service in advance of the 7 day period, the subscriber or subscriber=s agent must be told of that termination date at the time of the request for service termination
3. "Penalty": If the incumbent operator fails to comply with any of the procedural deadlines, the home run wiring will be automatically deemed abandoned and available for immediate use. The FCC declined to establish a monetary penalty at this time against incumbent operators who elect but then fail to remove the home run wiring. The FCC also declined to require an operator to post a performance bond prior to any removal.
4. Overall rule for seamless transition: The parties must cooperate so as not to create a service disruption. Alternative service providers and MDU owners are permitted to act as subscribers= agents (upon request of subscriber) in providing notice of a subscriber's desire to switch service providers on a unit-by-unit basis. Incumbent provider must disconnect the home run wiring from the lockbox (or pedestal etc.) and leave it accessible for the competitor within 24 hours of actual service termination.

CABLE HOME WIRING DISPOSITION