FCC Inside Wiring Rules
The FCC’s wiring rules are based on the recognition that the coaxial cable wiring infrastructure inside a residential multi-dwelling unit building cannot be easily or cost-effectively replicated by a would-be competitor to the incumbent cable television operator using that wiring to serve residents. Therefore, without regulatory intervention, the incumbent provider has an irreducible advantage over potential rivals, and competition never gets off the ground. The FCC’s inside wiring rules attempt to address this circumstance by mandating that in certain circumstances the incumbent cable company may be compelled to cede ownership and control over existing wiring infrastructure to the property owner, the cable television subscriber, or an alternative provider of video programming services.
The FCC rules apply to two categories of coaxial cable inside wiring: home run wiring and cable home wiring. Separate rules apply to each category of wiring.
The FCC defines home run wiring as “the wiring from the demarcation point to the point at which the MVPD's wiring becomes devoted to an individual subscriber or individual loop.” The rules governing the disposition of home run wiring are found at 47 C.F.R. § 76.804.
By contrast, cable home wiring is “the internal wiring contained within the premises of a subscriber which begins at the demarcation point.” The rules governing cable home wiring are found at 47 C.F.R. § 76.802.
The home run wiring rules are subdivided into the “building by building” rules and the “unit by unit” rules.
The building by building rules apply where the incumbent cable operator owns the home run wiring, and does not have a “legally enforceable right to remain” on the premises – i.e., where the incumbent cable provider has no ongoing contractual right to access the MDU property, and the property is not subject to a state or local mandatory access law.
The unit by unit rules apply where the incumbent cable operator owns the home wiring and “does not … have a legally enforceable right to maintain any particular home run wire dedicated to a particular unit on the premises against the MDU owner's wishes …” The unit by unit rules may be used by a property owner to facilitate competition among several video providers in a building with only one set of home run wires; the FCC rules are designed to allow the owner to force the incumbent to share the existing wiring.
The building by building procedure requires that the property owner give the incumbent cable operator a minimum of 90 days notice of intent to invoke the rule; the incumbent then has 30 days after receipt of the notice in which to elect to sell, abandon or remove all the home run wiring in the building. The wiring must be disposed of according to the incumbent’s election within 30 days after the end of the 90-day notice period. Thus, even if the incumbent cooperates, the rules contemplate four month transition phase.
The unit by unit procedure requires that the property owner give the incumbent 60 days notice; as with the building by building procedure, the incumbent has 30 days after receipt of notice in which to make a single election whether to sell, abandon or remove each home run wiring dedicated to a unit terminating the incumbent’s cable service. If the incumbent elects to sell the wiring to the MDU owner, the parties have 30 days after the date of election in which to negotiate a sale price, and if there is no agreement on price, the matter may be referred to binding arbitration. Assuming incumbent cooperation, the unit by unit rules allow for a transition period of at least two month.
The FCC’s rule for cable home wiring in MDU buildings provides that upon voluntary termination of cable service by an individual subscriber in an MDU building, the incumbent cable operator may not remove the cable home wiring unless, when informed that the subscriber wishes to terminate cable service, the cable operator offers to sell the wiring to the terminating subscriber at its replacement cost, the subscriber has declined, and neither the MDU owner nor the alternative provider has notified the MSO that it wishes to purchase the wiring if and when the terminating subscriber declines to purchase.
“If the [incumbent cable operator] is entitled to remove the cable home wiring, it must then remove the wiring within seven days of the subscriber’s decision [to purchase or not], under normal operating conditions, or make no subsequent attempt to remove it or restrict its use.”
The effect of the cable home wiring rules is to transfer ownership of the home wiring – the cable wiring on the subscriber’s side of the demarcation point – from the incumbent cable company to the subscriber who terminates the MSO’s cable service. In other words, home wiring not removed by the incumbent within 7 days after the subscriber’s voluntary termination of cable service is deemed abandoned to the subscriber. Presumably (depending on the state’s abandoned property laws), when a former cable subscriber moves out of his or her unit without removing the home wiring, that wiring is abandoned and becomes the property of the building owner.
As the legal owner of home wiring that is not removed after termination of services, the terminating subscriber or the property owner may authorize an alternative video provider to connect its signal distribution system to the wiring at the demarcation point. The incumbent provider has an affirmative obligation to facilitate the alternative provider’s access to the wiring at that point. According to the rule, 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.”
Under the FCC’s “Sheet Rock Order,” the demarcation point is generally located at the incumbent cable operator’s junction box. See subtopic entitled “FCC’s Sheet Rock Order” below for more information.
FCC Rules for Home Run Wiring: http://edocket.access.gpo.gov/cfr_2010/octqtr/47cfr76.804.htm
In 2007, the FCC in effect moved the cable “demarcation point” in most MDU buildings from the individual unit to the incumbent cable provider’s lock box. This change allows a competitive provider to access existing inside wiring at the lock box and, in some circumstances, to utilize that wiring without the property owner having to invoke the FCC’s inside wiring rules.
The FCC defines the cable demarcation point as “a point at (or about) twelve inches outside of where the cable wire enters the subscriber's dwelling unit, or, where the wire is physically inaccessible at such point, the closest practicable point thereto that does not require access to the individual subscriber's dwelling unit” (47 C.F.R. § 76.5(mm)(2)).
However, MDU owners are reluctant to allow a competitive provider to access the wiring at the 12-inch point due to the disruption caused by drilling through sheet rock in hallways. Therefore, in its “Sheet Rock Order” (Report and Order and Declaratory Ruling (CS Docket No. 95-184, rel. June 8, 2007)), the FCC ruled that wiring behind sheet rock or wall board is “physically inaccessible,” such that the demarcation point is located at the first location, moving away from the subscriber’s unit, where the wiring is accessible. Usually, that location is at the incumbent’s junction box.
The location of the cable demarcation point is very important because it is the point at which a competitive video provider may access existing inside wiring. The Commission has described the demarcation point as “the point at which an alternative multichannel video programming distributor (MVPD) would attach its wiring to the subscriber’s wiring in order to provide service,” and as the location where “a competing provider may access existing cable home wiring in an MDU building.”
Furthermore, the incumbent cable provider has a legal obligation under FCC regulations to take affirmative steps to facilitate an alternative video provider’s access to wiring at the demarcation point.
Therefore (assuming that the wiring is behind sheet rock at the 12-inch mark), the incumbent cable operator is prohibited by FCC regulations from blocking a competitor’s access to the cable home wiring at the point where the wiring terminates at the incumbent’s junction box.
Here is a typical scenario:
An MDU owner signs a right of entry agreement with a satellite provider, asking the provider to compete with the incumbent cable operator for subscribers at the property. The agreement gives the satellite provider a right to access and use existing inside wiring to carry its signal to subscribers. However, the incumbent cable company refuses to open its proprietary lock box, and warns the alternative provider that anyone tampering with the box will prosecuted for trespass and vandalism.
FCC regulations prohibit a cable company from blocking a competitor’s access to cable home wiring at the demarcation point.
Therefore, in this circumstance, both the property owner’s and the satellite provider’s legal rights may be violated. If the wiring is the property of the owner, the incumbent’s use of the lock box to block access may constitute a conversion of property as well as a breach of the incumbent’s right of entry agreement. Blocking access also impairs the competitor’s Federal right to access wiring at the demarcation point. Owners and competitive providers are advised to consult legal counsel for advice, guidance and possible legal action.
1. General Application: Applies only when the incumbent operator owns and intends to remove the cable home wiring when an individual subscriber (or an MDU owner on its behalf) voluntarily terminates service, either to vacate the premises or to switch providers. 2. Procedures for individual subscriber termination [can be implemented by MDU owner on behalf of all subscribers if MDU owner terminating incumbent=s access to entire building and MDU owner or alternative provider are not invoking home run wiring disposition procedural mechanism; see 3. directly below]: -- Subscriber places call to terminate service -- During call, incumbent operator must tell subscriber that operator (a) owns the cable home wiring; (b) intends to remove it; (c) must sell it to subscriber if subscriber wishes to purchase it for a specified per-foot replacement cost including the replacement cost for any passive splitters attached to the wiring on the subscriber=s side of the demarcation point, i.e., the total charge for the wiring -- If subscriber agrees to purchase home wiring, constructive ownership over wiring transfers immediately to subscriber who can authorize a competitor to use it in advance of final payment (competitor can reimburse subscriber for purchase) -- If subscriber declines to purchase home wiring, either MDU owner or alternative provider may do so; MDU owner must inform incumbent operator one time for the entire building that MDU owner (or alternative provider) will purchase the home wiring if and when a subscriber elects not to do so or incumbent is under no obligation to sell it; this one time notice can occur at the same time as the unit-by-unit disposition notice for the home run wiring; -- If no entity timely purchases home wiring, incumbent operator has seven calendar days to remove the wiring or make no subsequent attempt to remove it or restrict its use. 3. Procedures for MDU owner entire building termination where home run wiring disposition procedural mechanism also invoked: -- upon invocation of home run wiring procedures by provision of 90 day notice, incumbent operator has 30 days to (a) offer to sell to MDU owner any home wiring within the individual units which the incumbent owns and intends to remove, and (b) provide the MDU owner with the total per-foot replacement cost of such home wiring -- MDU owner may permit alternative provider to purchase the home wiring instead -- MDU owner or alternative provider must inform incumbent whether purchase will occur 30 days prior to access termination -- if purchase is rejected by MDU owner or alternative provider, incumbent provider can remove home wiring on the date of actual service termination but no later than 30 days thereafter 4. APenalty@: If incumbent operator fails to adhere to these procedures, home wiring ownership is automatically relinquished and operator is not entitled to remove wiring, restrict use or obtain compensation for it. LOOP-THROUGH CABLE WIRING DISPOSITION 1. The portion of the loop-through wiring within the individual units up to the demarcation point may be purchased by the MDU owner (or alternative provider) consistent with the rules governing the purchase of cable home wiring set forth above. 2. The portion of the loop-through wiring on the non-subscriber side of the demarcation point up to the riser or feeder cable will be determined in accordance with the procedures set forth for the disposition of home run wiring set forth above. 3. The demarcation point for loop-through wiring is set at or about 12 inches outside the point at which the loop enters or exits the first and last individual dwelling units on the loop, or as close as practicable where 12 inches outside is physically inaccessible. ACCESS TO MOLDING 1. Incumbent providers are prohibited from using any ownership interests they may have in property on or near the home run wiring, such as molding or conduit, to prevent or in any way interfere with the competitor=s ability to use the home run wiring after implementation of the procedural mechanisms set forth above. 2. An alternative provider can install, at its own expense, its own home run wiring within an incumbent=s existing molding, over the incumbent=s objection and without compensation, if the MDU owner gives its affirmative consent and there is adequate space in the molding, provided that the incumbent does not have an exclusive contractual right to occupy the molding. Sharing of space within conduits was not mandated. 3. If there is insufficient space in the existing molding, the MDU owner can agree that larger, replacement molding sufficient to house both providers= home run wiring be installed at the expense of the alternative provider as long as the incumbent does not have a contractual right to prohibit the replacement of the existing molding. CONTRACTS ENTERED AFTER EFFECTIVE DATE OF RULES 1. No requirement to transfer ownership of home run or home wiring to MDU owner upon installation. 2. For any contracts between any MVPDs and MDU owners entered into after the effective date of these rules, the contract must include a provision describing the disposition of the home run wiring upon the contract=s termination. Where a contract clearly and expressly addresses the disposition of the home run wiring, the above procedures will not apply. SIGNAL LEAKAGE RULES APPLICABLE 1. Existing cable signal leakage requirements are extended to all MVPDS, including SMATV and MMDS operators. All MVPDs must immediately comply with Section 76.613 of the FCC=s Rules upon the effective date of the inside wiring report and order for all systems. For systems already built or 75% built as of January 1, 1998, other than compliance with Section 76.613, MVPDs have a five-year transition time period to come into full compliance with the remainder of the FCC=s signal leakage rules. For systems built after January l, 1998, full compliance is expected upon system completion. The FCC may exempt all small MVPDs from the annual reporting requirements and is seeking further comment thereon.
Docket No: 95-184
Title: Telecommunications Services Inside Wiring, Customer Premises Equipment, Implementation of Cable Television Consumer Protection and Competition Act of 1992; Cable Home Wiring.