NEWSReport No. CS 97-2                  CABLE SERVICES ACTION               January 9, 1997

           COMMISSION PROPOSES RULES FOR VIDEO CLOSED CAPTIONING
                            (MM Docket 95-176)

     The Commission has adopted a proposal to establish rules to implement Section 305
of the Telecommunications Act of 1996 ("1996 Act") which generally requires that video
programming be closed captioned to ensure access to video programming by persons with
hearing disabilities.

     Closed captioning is a technology that assists viewers by identifying spoken words,
and may identify things like speakers, sound effects, music and laughter.  A viewer wishing
to see the closed captioning must use a set top decoder or a television with a built-in decoder. 
It is estimated that between 50 and 60 million US homes can currently receive closed
captioning.  Currently, the majority of programming on each of the commercial broadcast
networks is closed captioned, while nearly 30% of the prime time programming on the top 20
basic cable networks and over 60% on the top six premium networks is closed captioned. 
Digital transmission systems under development are being designed to include closed
captioning capabilities.  

     The 1996 Act requires the Commission to prescribe, by August 8, 1997, rules and
implementation schedules for captioning of video programming.  Congress generally required
that video programming be closed captioned, regardless of distribution technology, to ensure
access to persons with hearing disabilities.  Congress also recognized that in some situations
requiring that programming be closed captioned might prove to be an undue burden on video
programming providers or owners.  Accordingly, Congress authorized the Commission to
adopt as part of its rules provisions exempting classes of programs or services for which
provision of video programming would be economically burdensome.  Congress also
exempted programming providers or owners from any closed captioning requirements if
providing closed captioning would be inconsistent with contracts in effect on the date the
1996 Act was enacted.  Finally, Congress permitted video programming providers and owners
to petition the Commission for an exemption from the closed captioning requirements by
demonstrating that the requirements constituted an undue burden. 

Some of the key elements in the Notice adopted today include: 

     A proposal that those entities delivering video programming directly to
     consumers (i.e., television broadcasters and multichannel video programming
     distributors ("MVPDs")) be ultimately responsible for compliance with the
     closed captioning rules we adopt.  The Commission believes, however, that
     producers generally will have the responsibility for captioning programming
     regardless of who has the obligation to comply with the rules. 

     A proposed transition schedule for new programming requiring that all non-
     exempt, new programming be closed captioned within eight years.  The
     Commission proposes to phase in this captioning requirement by increasing the
     amount of required captioning by 25% every two years.  Thus, 25% of such
     programming would be required to be captioned at the end of the second year,
     50% at the end of the fourth year, 75% at the end of the sixth year, and all
     non-exempt, new programming by the end of the eighth year.  Alternatively,
     comment is sought on a ten year period with 25% captioned after three years,
     50% after five years, 75% after seven years, and 100% after ten years.

     A discussion on how to ensure that programming providers or owners
     "maximize the accessibility" of programming first published or exhibited before
     the effective date of our rules.  The Commission seeks comment on whether
     the rules should require that a percentage of library programming (e.g., 75%)
     ultimately be captioned and seeks comment on what deadline should apply. 
     Comment is also sought on whether a more flexible approach should be
     adopted.

     A discussion of exemptions where the economic burden of captioning
     programming outweighs the benefits to be derived from captioning and, in
     some cases, the complexity of adding the captioning.  The Commission seeks
     comment on whether a definition of economic burden should be based on
     relative market size, degree of distribution, audience rating or share, relative
     programming budgets or revenue base, repeat value, or a combination of
     factors.  The Commission does not propose to exempt any class of provider
     since all classes of providers appear to have the technical capability to deliver
     closed captioning to their viewers intact.
     
     The tentative conclusion that programming subject to contracts in effect on the
     date of enactment of the 1996 Act (i.e., February 8, 1996) that specifically
     prohibit closed captioning should be exempt from any captioning requirement. 
     Comment is sought on other types of contract provisions that may be
     inconsistent with captioning.

     A discussion of the factors the Commission will consider, the showing a
     petitioner must make, and the procedural mechanisms associated with,
     individual petitions for undue burden exemptions.

     A proposed complaint process for enforcement of the closed captioning rules adopted.

     Action by the Commission January 9, 1997, by Notice of Proposed Rulemaking  (FCC
97-4). Chairman Hundt, Commissioners Quello, Ness and Chong.
                                  - FCC -

News Media Contact:  Morgan Broman at (202) 418-2358
Cable Services Bureau Contact:  Marcia Glauberman at (202) 418-7200