that a franchising authority (here the Navy) allow an applicant's cable system "a reasonable period of time to become capable of providing cable service to all households in the franchise area. . . ." That language on its face contains no "requirement" of "universal service," of course. Americable's strained argument is at odds with the purpose of the Cable Act, which is to promote competition, and of the amendment in question, which protects the interests of new franchise applicants and not incumbents like Americable. See S.Rep. 92, 102d Conf., 2d Sess. 1991, reprinted in  4 U.S. Code Cong. & Admin. News 1133, 1225. The additional provision cited by plaintiff, 47 U.S.C. § 541 (a) (3), does not enhance the argument. That provision deals with the practice of excluding low income areas from cable service coverage and is designed to protect the interests of the consuming public, not those of the cable service provider. Thus even if Americable had standing to complain about "cherry picking" under the Cable Act, which is doubtful, see Animal Legal Defense Fund, Inc. v. Espy, 306 U.S. App. D.C. 188, 23 F.3d 496, 503 (D.C. Cir. 1994), this particular claim must be dismissed for failure to state a claim upon which relief can be granted.
Procurement Regulation Claims
The Navy is required by its own procurement regulations to "contract out" those services that need not be performed by military personnel, if a private contractor can provide the service at lower cost, and to conduct a cost assessment before it brings existing commercial services "in house." 32 C.F.R. §§ 169.4(b), 169.4(d) (1988). Americable argues that the proposed SMATV system is an effort to bring "in-house" the provision of cable service and that the Navy has not properly compared the cost of SMATV to that of Americable's service.
This claim, too, fails to state a claim upon which relief can be granted. Defense Department regulations define "in house commercial activities" -- proposed activities that would trigger the cost comparison requirements -- as those performed by military personnel. 32 C.F.R. § 169.3 (1988). In this case, the Navy has solicited bids for the construction of the SMATV system from private contractors. Plaintiff has not alleged that the Navy is considering building the system itself using military personnel, and the Navy has not decided to conduct "in house commercial activities" within the meaning of the Departmental regulations.
First Amendment Claim
Americable next contends that the SMATV solicitation violates its First Amendment rights by threatening to cut off its access to the residents of the BQ. The contention is without merit.
It is undisputed that, while the BQ's bulk subscription to Americable's service may not be renewed, Americable's transmission facilities and solicitation rights will remain undisturbed. In particular, premium channels will not be offered through the SMATV system, and individual BQ residents will remain free to subscribe to them through Americable's service. Rendering Americable's service less attractive in the marketplace by providing to residents a subsidized alternative does not give rise to First Amendment injury. See AMSAT Cable v. Cablevision of Connecticut, 6 F.3d 867 (2d Cir. 1993); Warner Cable Communications, Inc. v. City of Niceville, 911 F.2d 634, 638 (11th Cir. 1990).
Defendants would be entitled to dismissal at this point even if the proposal were to displace Americable entirely at the BQ. Plaintiff does not allege, and there is no record evidence to suggest, that the BQ is a public forum. See Greer v. Spock, 424 U.S. 828, 47 L. Ed. 2d 505, 96 S. Ct. 1211 (1976). Like the proprietor of a boarding house or hotel, the Navy purchases cable service for the benefit of the BQ's temporary occupants. The Navy's purchasing decision may be based on any reasonable criteria, as long as it is not motivated by hostility to the viewpoint expressed by a competing cable provider. See Perry Education Ass'n v. Perry Local Educators' Ass'n, 460 U.S. 37, 46, 74 L. Ed. 2d 794, 103 S. Ct. 948 (1983). Plaintiff's own complaint recites that the Navy has solicited bids in the belief that SMATV service will be cheaper than Americable's service. That reason, in the absence of allegations of discrimination against Americable based on the content of its programming, defeats plaintiff's First Amendment claim.
Due Process Claim
Americable argues, finally, that the Navy's decision to provide SMATV service at the BQ amounts to a termination of its franchise agreement, triggering due process protections. This claim is defeated by the language of the franchise agreement itself, which provides that "this agreement [does not] preclude the installation and operation of future Government or privately owned cable TV systems," Franchise Agreement P8(d), and entitles subscribers to use government-owned master antenna television systems without interference from Americable, Franchise Agreement P8(a). The Navy's exercise of its option under the agreement to provide a competing cable service does not amount to a deprivation of plaintiff's property interest in the franchise.
An appropriate order accompanies this memorandum.
United States District Judge
February 7, 1996
For the reasons set forth in the accompanying memorandum, it is this 7th day of February, 1996, hereby ORDERED that defendants' motion to dismiss, or in the alternative, for summary judgment [#22] is granted, and that this action be, and it is hereby, dismissed.
United States District Judge