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In re Alleged Non-Compliance by RCN of NY

February 9, 2005

IN THE MATTER OF ALLEGED NON-COMPLIANCE BY RCN OF NY, A WHOLLY-OWNED SUBSIDIARY OF RCN CORPORATION, WITH THE REQUIREMENTS OF N.J.S.A. 48:5A-15, 16, 17 AND 22 REQUIRING MUNICIPAL CONSENT FROM THE CITY OF JERSEY CITY ENVIRONMENTAL PROTECTION AND A CERTIFICATE OF APPROVAL FROM THE BOARD FOR NEWPORT COMMUNITY IN JERSEY CITY, NEW JERSEY.


On appeal from the New Jersey Board of Public Utilities.

Before Judges Wefing, Fall and C.S. Fisher.

The opinion of the court was delivered by: Wefing, P.J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued October 14, 2004

RCN Telecom Services, Inc. ("RCN") appeals from a Final Order of the New Jersey Board of Public Utilities ("BPU") in which the BPU concluded that RCN should be classified as a cable system under 47 U.S.C.A. § 522(7) and, as a consequence, subject to the BPU's jurisdiction. After reviewing the record in light of the contentions advanced on appeal, we are satisfied that the BPU erred in reaching this conclusion and, accordingly, we reverse.

Although the lay public may speak generally of watching"cable TV," there are different technologies by which television signals are transmitted to the viewing public. Those technological differences are legally significant because they generate different legal consequences. In this appeal, we are called upon to consider alternate and competing methods of supplying video programming and whether the methodology utilized by RCN"uses a public right of way." RCN contends that it does not make use of public right-of-way but the BPU reached the opposite conclusion. Analyzing and resolving that issue will determine whether a satellite master antenna television system (referred to generally by the acronym"SMATV") maintained and operated by RCN also constitutes a"cable system."

Congress has defined a cable system in 47 U.S.C.A. § 522 as a facility, consisting of a set of closed transmission paths and associated signal generation, reception, and control equipment that is designed to provide cable service which includes video programming and which is provided to multiple subscribers within a community....

The statute continues, however, to exclude from that encompassing definition"a facility that serves subscribers without using any public right-of-way...." 47 U.S.C.A. § 522(7)(B).

In the most basic terms,"cable television is a one-way, point-to-point telecommunication system. Cable operators send a signal to individual subscribers' homes through a coaxial cable or fiber optic line." Michael W. Maseth, Comment, The Erosion of First Amendment Protections of Speech and Press: The"Must Carry" Provisions of the 1992 Cable Act, 24 Cap. U. L. Rev. 423, 424 (1995).

A SMATV system also transmits video programming to its customers, but it utilizes a combination of wiring, antennae and satellites to do so."[A]n SMATV system typically receives a signal from a satellite through a small satellite dish located on a rooftop and then retransmits the signal by wire to units within a building or complex of buildings." FCC v. Beach Communications, 508 U.S. 307, 311, 113 S.Ct. 2096, 2100, 124 L.Ed. 2d 211, 220 (1993). See also I/M/O Earth Satellite Communications, Inc., 95 F.C.C.2d 1223 (1983), aff'd sub nom. New York State Comm'n on Cable Television v. FCC, 749 F.2d 804 (D.C. Cir. 1984) (describing a SMATV system as"consist[ing] of a receive-only satellite earth station that provides premium programming signals transmitted to the receive station via satellite and a master antenna for the receipt of over-the-air television broadcast signals. These signals are combined and distributed through cable to subscribers residing in the multi unit dwellings."); Andrew D. Ketter, Comment, The Narrow Choice of Broadband Providers for Consumers: Competition and Local Regulation, 2002 Wis. L. Rev. 211, 218 (2002).

RCN utilizes SMATV technology to provide video programming to the Newport complex in Jersey City which was laid out and developed by a private developer, Newport Associates Development Company, ("NADC"). NADC included SMATV technology from the outset in its original plan for the project as the method by which the residents of Newport would receive cable video programming. At the time the present dispute arose, Newport consisted of ten buildings with more than two thousand residential units. RCN is the successor to the original supplier of video programming to the Newport residents.

RCN collects a satellite signal at a site located in New York which it then sends via microwave transmission to an antenna centrally located within Newport. That video signal is then distributed among the Newport buildings by way of coaxial cable. Those cables pass under two roadways, River Drive South and Newport Parkway, to provide video programming to the entire complex.

When NADC originally developed Newport, the roadways within the complex were not public thoroughfares but were owned by NADC. The coaxial cables used to distribute the SMATV signal among the Newport buildings were buried under these two private roads. Because RCN's SMATV system did not use a public right of-way, it was excluded from the definition of a"cable system" contained in 47 U.S.C.A. § 522(7).

Eventually, for reasons unrelated to this appeal, NADC determined to dedicate River Drive South and Newport Parkway as public streets. After a period of review and consideration, Jersey City accepted these two roads as public streets and passed appropriate ordinances. ...


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