On October 31, 2007, the Federal Communications Commission (FCC) adopted a Report and Order (Order) banning the use of exclusivity clauses for the provision of video services to multiple dwelling units or other real estate developments. Specifically, the Order:

1. Prohibits exclusive access agreements between franchised cable operators (such as Comcast, Time Warner, etc.) and multiple dwelling unit owners (such as apartment complex owners).

2. Once the Order is effective (which will be 30 days after it is published in the Federal Register), existing contracts between franchised cable operators and multiple dwelling unit owners that have exclusive access provisions may remain in effect, but the exclusive access provision in such contracts will be unenforceable.

The FCC will soon decide the following:

1.Whether to extend its prohibition to exclusive access agreements between multiple dwelling unit owners and video services providers other than franchised cable operators (such as DIRECTV, Dish Network and private operators). Currently, the ban is only for agreements with cable franchise operators (and video dialtone operators, of which there are very few).

2. Whether to prohibit "exclusive marketing arrangements" between multiple dwelling unit owners and franchised cable operators and other video service providers.

3. Whether to prohibit 'bulk billing arrangements" between multiple dwelling unit owners and franchised cable operators and other video service providers.

4. Whether to adopt a similar prohibition on agreements concerning telecommunications services, such as local and long distance services.

While the Order bans certain exclusive agreements as discussed above, it does not authorize a video service provider to access a property to provide video services over the objections of the multiple dwelling unit owner (although some state laws do permit such a taking of property).

For more information, please contact

Alan Fishel
fishel.alan@arentfox.com
202.857.6450

Jeffrey Rummel
rummelj@arentfox.com
202.715.8479