• On December 5, 2005, the FCC requested additional documents and information to supplement its review of applications proposing the sale of Adelphia cable systems to Time Warner and Comcast. The applications also propose several Time Warner-Comcast system swaps. The request sought documents and/or narrative responses in the following areas:

    Corporate Organization and Agreement Terms. The FCC asks whether certain aspects of the agreements associated with the transactions are consistent with the obligation to divest certain Comcast assets currently held in trust (such assets are subject to a divestiture requirement under the terms of the FCC’s 2002 decision approving Comcast’s acquisition of AT&T Broadband).

    Systems/Services/Subscribers. Details on each cable system owned by Adelphia, Comcast, and Time Warner including the number of subscribers served, geographic areas served, nature/percentage of economic interest and management control, date of acquisition, and lists of competitors for each system; information on the services offered by each system (i.e., basic, expanded, digital, high-speed Internet, voice, bundles), the revenue generated by each service offering, and subscribership/churn data for each offering.

    Content. Documents and information on the parties’ interests in and agreements with video programming networks. Documents and information on how the parties select the video programming content they will carry on their systems.

    Broadband/VOIP. Compliance with net neutrality principles, VOIP 911 requirements, and nomadic customer premises equipment requirements.

    Regional Concentration Issues. Work papers and underlying data used by the parties in responding to claims that regional concentration will harm competition and the public interest, especially with respect to competitors’ access to regional sports programming.

    The FCC letters requested that the applicants file responsive documents and narratives by December 19, 2005. Responses filed by the applicants are available for public review via the FCC’s electronic comment filing system and the transaction webpage: http://www.fcc.gov/transaction/tw-comcast_adelphia.html. Material that the applicants deemed sensitive was filed pursuant to the FCC’s protective order in this proceeding. Parties that have filed comments in this proceeding may review such material by executing an acknowledgment of confidentiality, as specified in the protective order. The applicants have requested a heightened level of confidential treatment for certain material filed in response to the FCC letters. The FCC has not yet addressed this request.

    The FCC’s review of the proposed transactions commenced in May 2005. Several years ago, the FCC set a goal to complete its review of transactions within 180 days of the date public notice of a proposed transaction. Today [December 29], the FCC’s transaction “clock” for the Adelphia sale is on day [208], which places the FCC’s review [twenty-eight] days beyond its timing goal. Required bankruptcy court and FTC approvals also remain pending.

    Authored by:
    Erin Dozier