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U MOSS & BARNETT A PROFESSIONAL AS IAMN Mr. Clyde Gouldman Page 3 September 23, 1994 (14) days of the initial decision. Adelphia must provide notice to the City of its decision whether or not to appeal to the FCC within this time period. Consumers shall provide notice to the City of their decision to appeal to the FCC within this time period (See 47 C.F.R. Section 76.986(b)). The FCC has also provided interpretive guidelines for determining whether an operator's collective offering of "a la carte" channels should be accorded regulated or unregulated treatment. The guidelines are intended to enable operators to better determine what collective offerings of "a la carte" channels will be considered an evasion of rate regulation and/or a realistic service offering, and are to help local franchising authorities and the FCC to assess expeditiously the appropriate regulatory status of individual offerings. In evaluating offerings in individual cases the FCC will consider whether consumers are being offered a greater variety of programming choices and options and whether the price for those choices is generally increasing or decreasing from previous levels. The FCC has identified several factors that local authorities and the FCC should consider in assessing in an individual case whether an "a la cartel- package arte"package enhances consumer choice and does not constitute an evasion of rate regulation. Several of these factors, if present, would suggest that the rates for the offering should be unregulated. These are: 1. The operator had offered (or begun to explore offering) "a la carte" packages consisting of non -premium channels prior to rate regulation; 2. The operator has conducted market research that suggests introducing an "a la carte" package would be profitable, other than as a means of evading rate regulation; 3. A subscriber is free to select which channels will be included in the package; 4. Subscribers are given notice that fully discloses their options, as well as fully discloses the total price (including related equipment charges) associated with exercising any of these options; and 5. An insignificant percentage or number of channels in the package has been removed from regulated tiers. On the other hand, the following factors would weigh against allowing unregulated treatment of collective offerings of "a la carte" channels: �. 1. The introduction of the "a la carte" package results in avoiding rate reductions that otherwise would have been required under the FCC's rules;