article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Video Competition and Consumer Choice Act of 1998''. SEC. 2. CABLE PROGRAMMING SERVICES REGULATION. Section 623(c)(4) of the Communications Act of 1934 (47 U.S.C. 543(c)(4)) is amended to read as follows: ``(4) Sunset of upper tier rate regulation.-- ``(A) Programming choice required.--The authority to regulate rates under this subsection shall not apply to cable programming services provided after March 31, 1999, by a cable system unless the franchising authority for such cable system, after notice and opportunity for a public hearing at which the operator, subscribers, and other interested persons may appear and present evidence, certifies to the Commission that the cable operator of such system is not providing to subscribers an acceptable range of programming choices to the extent technically feasible and economically reasonable. ``(B) Basis for certification.--Any franchising authority making such a certification shall include with the statement the factors upon which the franchising authority bases its determination. Such factors may include (but are not limited to) the factors described in paragraph (2) and any one or more of the following: ``(i) delivery of the packages is technically feasible based on the current and expected capability of the system; ``(ii) delivery of the packages is economically reasonable based on the technical requirements for delivery of the packages; ``(iii) delivery of the packages can be performed without jeopardizing security of multichannel video programming and other services offered over the system, or impeding the legal rights of the system operator to prevent theft of service; ``(iv) any revenues received by the cable operator and cable programming providers from advertising, including the economic effect of offering additional programming choices on advertising revenues and subscriber rates; ``(v) the packages permit subscribers to subscribe to significantly less than the majority of upper tier programing services available; and ``(vi) the packages are related to the program category interests of groups as demonstrated by polling, surveys, referenda, statistics, or other comparable means based on statistics from the franchising area. ``(C) Commission review.--Upon receipt of a request for review from a cable operator, the Commission may review any certification submitted under subparagraph (A) and may rescind such certification if the Commission determines that the determination of the franchising authority is arbitrary and capricious. ``(D) Duration.--A certification under subparagraph (A) is effective for one year, unless earlier withdrawn by the franchising authority or rescinded by the Commission. ``(E) No effect on effective competition test.-- Notwithstanding any certification under this paragraph, a cable system that is subject to effective competition, as determined under subsection (a)(2), shall not be subject to regulation under this subsection.''. SEC. 3. PROGRAM ACCESS. (a) Amendments To Extend and Revise Program Access Requirements.-- Section 628 of the Communications Act of 1934 (47 U.S.C. 548) is amended-- (1) in subsection (a), by striking ``satellite cable programming and satellite broadcast programming'' and inserting ``multichannel video programming''; (2) in subsection (b)-- (A) by striking ``cable operator, a satellite cable programming vendor in which a cable operator has an attributable interest, or a satellite broadcast programming vendor'' and inserting ``multichannel video programming distributor''; and (B) by striking ``satellite cable programming or satellite broadcast programming'' and inserting multichannel video programming''; (3) in subsection (c)-- (A) by striking ``Within 180 days after the date of enactment of this section, the Commission'' in paragraph (1) and inserting ``The Commission''; (B) by striking paragraph (2) and inserting the following: ``(2) Minimum contents of regulations.--The regulations to be promulgated under this section shall-- ``(A) establish effective safeguards to prevent any multichannel video programming distributor from unduly or improperly influencing the decision of any multichannel video programming vendor to sell, or the prices, terms, and conditions of sale of, multichannel video programming to any other multichannel video programming distributor; ``(B) prohibit discrimination by a multichannel video programming vendor in the prices, terms, and conditions of sale or delivery of such programming among or between cable systems, cable operators, or other multichannel video programming distributors, or their agents or buying groups; except that a multichannel video programming vendor shall not be prohibited from-- ``(i) imposing reasonable requirements for creditworthiness, offering of service, and financial stability and standards regarding character and technical quality; ``(ii) establishing different prices, terms, and conditions to take into account actual and reasonable differences in the cost of creation, sale, delivery, or transmission of multichannel video programming; ``(iii) establishing different prices, terms, and conditions which take into account economies of scale, cost savings, or other direct and legitimate economic benefits reasonably attributable to the number of subscribers served by the distributor; or ``(iv) entering into an exclusive contract that is permitted under subparagraph (D); ``(C) prohibit practices, understandings, arrangements, and activities, including exclusive contracts for multichannel video programming between a multichannel video programming distributor and a multichannel video programming vendor, that prevent any multichannel video programming distributor from obtaining such programming for distribution to persons in areas not served by a cable operator; ``(D) with respect to distribution to persons in areas served by a cable operator-- ``(i) prohibit exclusive contracts for multichannel video programming between a cable operator and a multichannel video programming vendor in which a cable operator has an attributable interest, unless the Commission determines (in accordance with paragraph (4)) that such contract is in the public interest; ``(ii) not prohibit exclusive contracts for multichannel video programming between a multichannel video programming distributor, other than a cable operator, and a multichannel video programming vendor, other than a multichannel video programming vendor in which a cable operator has an attributable interest, unless the Commission determines (in accordance with paragraph (4)) that such contract is contrary to the public interest.''; and (C) in paragraph (5), by striking ``enactment of this section'' and inserting ``enactment of the Video Competition and Consumer Choice Act of 1998''; (4) in subsection (h), by adding at the end the following new paragraph: ``(3) Other contracts.--No contract to grant exclusive distribution rights to any person with respect to multichannel video programming may be entered into on or after the date of enactment of the Video Competition and Consumer Choice Act of 1998, except as permitted under subsection (c)(2)(D). No contract entered into after June 1, 1990, and before such date of enactment that grants such rights may continue in effect after 120 days after the date of enactment of the Video Competition and Consumer Choice Act of 1998.''; (5) in subsection (i), by adding at the end the following new paragraphs: ``(5) The term `multichannel video programming' means video programming which is transmitted by any means and which is primarily intended for the direct receipt by multichannel video programming distributors for retransmission to their subscribers. ``(6) The term `multichannel video programming vendor' means a person engaged in the production, creation, or wholesale distribution for sale of multichannel video programming.''. (6) by striking subsection (j) and inserting the following: ``(j) Common Carriers.--Any provision that applies to a multichannel video programming distributor or multichannel video programming vendor under this section shall apply to a common carrier or its affiliate that provides multichannel video programming.''. (b) Deadlines for Revised Regulations.--The Federal Communications Commission shall prescribe such revisions to its regulations as may be necessary to implement the amendments made by subsection (a) within 120 days after the date of enactment of this Act. SEC. 4. LIFELINE CABLE SERVICE TIER. Section 623(b) of the Communications Act of 1934 (47 U.S.C. 543(b)) is amended-- (1) in the subsection heading by inserting ``and Lifeline'' after ``Basic''; and (2) by adding at the end the following new paragraph: ``(9) Lifeline service tier.-- ``(A) Contents.--Each cable operator of a cable system shall make available for sale to its subscribers a separately packaged lifeline service tier. Such lifeline service tier shall consist exclusively of the following: ``(i) All signals carried in fulfillment of the requirements of sections 614 and 615. ``(ii) Any public, educational, and governmental access programming required by the franchise of the cable system to be provided to subscribers. ``(iii) Any signal of a local television broadcast station that is provided by the cable operator to any subscriber, except that a digital television service signal shall not be required to be carried as part of the lifeline service tier pursuant to this clause (iii) unless such carriage is required by regulations prescribed by the Commission. ``(B) Prohibition on additions.--A cable operator may not add additional video programming signals or services to the lifeline service tier. ``(C) Rate regulation.--The Commission shall prescribe regulations concerning the rates for the lifeline service tier. Such regulations shall be designed to achieve the goals of-- ``(i) ensuring that rates for the lifeline service tier are reasonable; and ``(ii) promoting multichannel video programming distribution competition.''.
summary: Video Competition and Consumer Choice Act of 1998 - Amends the Communications Act of 1934 to make the authority of the Federal Communications Commission (FCC) to regulate cable television service rates inapplicable to services provided after March 31, 1999, by a cable system unless the franchising authority for such system, after notice and opportunity for a public hearing, certifies to the FCC that the cable operator of such system is not providing subscribers an acceptable range of programming choices to the extent technically feasible and economically reasonable. Outlines factors to be considered for such certification. Authorizes FCC review of such certifications. Makes such certifications effective for one year, unless earlier withdrawn or rescinded. Replaces references to "satellite cable programming" and "satellite broadcast programming" with "multichannel video programming (MVP)." Repeals a deadline for FCC regulations concerning the development of competition and diversity in MVP distribution. Outlines minimum requirements for such regulations, including prohibited actions by an MVP vendor with respect to the sale or delivery of such programming among cable systems, cable operators, and other MVP distributors. Prohibits entering into contracts to grant exclusive distribution rights to any person with respect to MVP after the date of enactment of this Act, except for certain exclusivity contracts granted by the FCC in the public interest. Prohibits any such contract (other than the public interest contract) already entered into before such date of enactment to continue after 120 days after such date. Defines MVP as video programming which is transmitted by any means and which is primarily intended for the direct receipt by MVP distributors for retransmission to their subscribers. Requires the revision of MVP regulations as necessitated by this Act within 120 days after enactment. Requires each cable operator of a cable system to make available for sale to its subscribers a separately packaged lifeline service tier consisting exclusively of: (1) FCC-required local commercial television and noncommercial educational television programming; (2) any public, educational, and governmental access programming required by the cable system franchise; and (3) any signal of a local television broadcast station provided by the cable operator to any subscriber (with an exception). Prohibits a cable operator from adding additional video programming signals or services to the lifeline tier. Directs the FCC to prescribe regulations for lifeline tier rates.