MCS is pleased to update the Commission on the state of the closed-captioning industry from our perspective. We will respond to your specific inquiry in our Discussion segment addressing the following issues.

1. Market competitiveness of the closed-captioning industry, including anti-competitive factors affecting the proper functioning of competitive markets, from November 2005, through November 2010.
2. Declining opportunities for small businesses to remain in business, anti-competitive small business strategies implemented by cable and broadcast networks toward small vendors by major cable and broadcast providers.
3. Quality standards vs. guidelines- accuracy, spelling, grammar, punctuation. Elements in computing accurate, timely captions which are contextually correct, and real-time vs. "offline" closed-captioning guidelines.
4. Complaint procedures and abuses of the FCC electronic filing process.
5. Availability of captioners, impact of standards on the supply of captioners, and economic disincentives for real-time writers to enter and stay in the profession. Impact of standards on supply of captioners.
6. Imposition of FCC fines, and current market trends towards indemnification to broadcasters in contractual obligations for fines.
7. Remedies and suggested action by the FCC and additional oversight by the U.S. Congress.

     II. Background information

     Media Captioning Services was formed in 1987, and was the first woman-owned captioning company formed in the U.S. to provide real-time closed-captioning. MCS has provided real-time captioning on major national, regional and local television stations, broadcast and cable, over the past 24 and a half years. Our company was selected by CNN to begin real-time captioning on their cable network in 1990, and we provided captioning on CNN through 2002. MCS is a mid-sized, full-service captioning company providing services currently to major news, sports to national and local video programmers. We have real-time captioned over 600,000 hours of news and sports programming since 1987.

     III. Discussion

     a. Market competitiveness within the closed-captioning industry

     In the Notice of Proposed Rulemaking released July 21, 2005, the FCC noted "Currently, there are no standards for non-technical quality aspects of closed-captioning", and invited comment on this matter. In our 2005 reply comments, we concurred with the FCC's earlier statement in the August 22, 1997 Report and Order, stating

The assumption behind this conclusion was that an efficient, rational marketplace where parties were free to offer their services on a competitive basis -- offering the best value to consumers -- would ensure that quality captioning would be offered to consumers.

"we seek to place maximum reliance on competitive market forces to develop efficient and cost-effective methods for captioning, and for ensuring a high level of quality for caption." The assumption behind this conclusion was that an efficient, rational marketplace where parties were free to offer their services on a competitive basis -- offering the best value to consumers -- would ensure that quality captioning would be offered to consumers. However, the closed-captioning market has not evolved into a true competitive marketplace, and it is essential the FCC and consumers understand this from providers of closed-captioning services.

     The genesis of the problem was brought to the attention of the FCC by MCS in our 2005 FCC Comments. We noted that in 2002, MCS was invited to bid on 12,000 hours per annum of video programming on CNN's networks. Their (CNN's) objective was to obtain a "no-cost bid" - essentially looking to have a zero cost for closed-captioning. They were responsive to a competitor's "barter" based proposal, where advertising time was sold by ad companies contractually tied to the captioning company, which funded closed-captioning. This concept of paying for captioning by offering advertising time to a captioning company gained traction during the period 2003-2006. This technique for financing captioning was used frequently to begin real-time captioning in local markets beyond the top 25 DMAs, which were not mandated to provide real-time closed-captioning. During the economic contraction 2007 through 2009, as major sources of advertising dollars declined, real-time captioning services were eliminated and/or degraded, particularly in "local" markets.

     MCS noted, in our 2005 Comments, that a major loophole was created in the 1997 FCC Report and Order that allowed broadcast and cable companies to use this barter system for paying for closed-captioning. This "loophole" was pointed out to MCS by a staff attorney in the cable division of the FCC.

Bottom line, by valuing closed-captioning services at zero, these barter strategies have contributed to a significant devaluation of closed-captioning services by a considerable number of broadcaster and cable providers.

The 1997 Report and Order set a threshold for a company's captioning expenses at 2% of gross revenues as a benchmark, that would constitute an "undue burden" for a video programmer. However, there was no requirement for a broadcast and/or cable provider to pay anything for closed-captioning. Bottom line, by valuing closed-captioning services at zero, these barter strategies have contributed to a significant devaluation of closed-captioning services by a considerable number of broadcaster and cable providers.

     It should be noted that during the period 1997 through 2006 (following the passage of the Telecommunications Act in 1996), broadcast and cable providers have enjoyed a considerable increase in revenues, despite a decline in viewership for cable and network programming. For example, in 1997, according to the Pew Research Center, CNN's total revenue was $642 million, rising to $985.3 million through 2006, a rise of 53%. As recently as November, 2010 CNN has continued to pursue and will, more likely than not, award another barter-based captioning contract to keep its captioning costs "at or near zero." During the same period of time, 1997 through 2006, per-hour real-time captioning rates charged by major captioning companies have declined from $175/hr on average to less than $90 per hour, a 40% decline in revenue per hour. The per-hour compensation to real-time captioners (independent contractors) has also declined, with rates paid to independent contractors declining from $120 to approximately $60 per hour currently, a 50% decline.

     b. Declining opportunities for small real-time captioning companies

     In 2010, a major broadcast network conducted an RFP to provide over 42,000 hours per annum of real-time captioning on its extensive cable, local news, and network programming. The stated goal was to award the contract to one provider, effectively eliminating other small captioning companies from serious contention.

This decision to award such a large volume of captioning hours on a sole-source basis effectively eliminated opportunities to compete, and was an unreasonable barrier to entry for smaller companies with the operating expertise to provide such services.

This decision to award such a large volume of captioning hours on a sole-source basis effectively eliminated opportunities to compete, and was an unreasonable barrier to entry for smaller companies with the operating expertise to provide such services. Even though "partnerships" were encouraged to enable small real-time captioning companies to compete, such actions promoting communications among competitors belies ignorance, or presumably indifference by the network to antitrust laws on this matter.

     We recognize the FCC has no enforcement authority in the area of antitrust compliance, but the aforementioned market developments as recently as 2010 represent the significant failure of the marketplace to allow competitive forces to operate as the FCC envisioned in 1997. In fact, it is necessary for the Commission to review Justice Black's interpretation of the Sherman Antitrust Act of 1890, a relevant but neglected Act forming the basis of antitrust legislation in our country. Justice Black noted: "the Sherman Act was designed to be a comprehensive charter of economic liberty aimed at preserving free and unfettered competition as the rule of trade. It rests on the premise that the unrestrained interaction of competitive forces will yield the best allocation of our economic resources, the lowest prices, while at the same time providing an environment conducive to the preservation of our democratic, political, and social institutions." During the period 2005 through 2010, the competitive allocation of resources envisioned by the FCC, as embodied by Justice Black in his aforementioned statement ( Northern Pacific Ry v United States, 356 U.S. 1,4, 78 S,CT. 514,517,2 L. Ed. 2d 545, 549 (1958) ) has deteriorated in the closed-captioning industry, necessitating regulatory action by the FCC on behalf of small captioning companies to preserve their, and the industry's, viability.

     During the period 2005-2010, the revenues generated by the dominant two companies in our industry increased as compared with companies generating less than $7 million in revenues. We appreciate the FCC's recognition of our comments filed in 2005 regarding the regulatory flexibility analysis, with specific reference to the impact on small captioning company businesses, and the Commission's efforts to understand the distribution of revenues earned by companies in our industry.

We disagree going forward, relying prima facie on the fact that any proposed guidelines and/or standards for real-time and offline captioning would hold captioning companies liable for complying with new rules the Commission may implement.

In the FCC's 2008 response to our comments, the Commission noted that captioning companies are not directly affected by the Commission's requirements that video programming be captioned, because they are not the entities ultimately responsible for compliance with the closed-captioning rules, and thus only indirectly affected by the rules and not responsible for compliance. We disagree going forward, relying prima facie on the fact that any proposed guidelines and/or standards for real-time and offline captioning would hold captioning companies liable for complying with new rules the Commission may implement. If the FCC sets forth such regulations citing performance specifications we must meet when providing closed-captioning, we most certainly will be responsible for a key component of the captioning process. There will certainly be a disproportionate impact on small to mid-sized captioning companies not dominant in the captioning business.

     The FCC must look beyond the SBA size standards noted in par 25 of FCC 08-255, and define a separate category comprised of establishments primarily engaged in closed-captioning as opposed to consolidating "Court Reporting and Stenotype Services" along with captioning. There are substantially more companies involved in providing "stenotype/court reporting" services (which may provide real-time captioning and CART for video programmers as ancillary services), than solely closed-captioning services for the broadcast and captioning industry. This is essential in order for the Commission to understand the actual number of closed-captioning companies engaged in providing captioning services, to determine the distribution of real-time captioning hours and revenues. This will further enable the FCC to assess which companies are "dominant" in the provision of services. We suggest you require all video programmers, broadcast and cable, to report their current vendors so that the FCC can make its assessment of the relative operating capacity of the real-time captioning industry moving forward, and the distribution of captioning hours to make its own assessment of how captioning services are provided.

     It is essential, as part of any additional Rulemaking related to guidelines or standards, that information in an Initial or Final Regulatory Flexibility Analysis consider the impact of your rulemaking on closed-captioning by companies solely engaged in providing real-time and/or offline captioning, and whether such Rulemaking will exacerbate barriers to competition we have cited.

It is essential, as part of any additional Rulemaking related to guidelines or standards, that information in an Initial or Final Regulatory Flexibility Analysis consider the impact of your rulemaking on closed-captioning by companies solely engaged in providing real-time and/or offline captioning, and whether such Rulemaking will exacerbate barriers to competition we have cited.

In addition, due consideration needs to be made of an analysis of dominant companies in our industry with specific reference to their market share/power to determine if monopoly power has been created by dominant companies(s) with the assistance of certain broadcast and cable providers. These are not specious comments. Monopoly power may be inferred from factors "not so directly dependent upon market definitions like entry barriers, relative size of competitors, the actual use of economic power by predator companies, and a trend toward greater or less economic power."

     Based on the factors cited above, we assert that the closed-captioning industry in 2010 has consolidated in terms of the number of providers, experienced an increase in real-time captioned hours captioned by two companies that have increased their dominant position, as well as their concentration of economic power to the detriment of smaller captioning companies who are equally capable of providing high-quality captioning services. This has been facilitated by the sourcing policies of three complicitous cable and broadcast programmers at a minimum, who control over 85,000 hours of programming content broadcast to consumers each year. These developments have created substantial disincentives for real-time captioners and the majority of companies to remain in the business.

     c. Quality standards vs guidelines

     In our 2005 Comments, MCS suggested that the Commission require a functional equivalence guideline for real-time and for pre-produced programming. We continue to suggest such guidelines, although we have updated our threshold accuracy requirements to meet a functional equivalence guideline.

     Real-time captioning which is functionally equivalent to the audio portion of a broadcast must be accurate, and contextually correct. High quality is necessary for the real-time captioning to be functionally equivalent to the audio portion. Accuracy is the key element of high-quality in the real-time captioning process. While some may argue that completeness is an integral component, and that verbatim is the baseline to be achieved, we maintain that while verbatim is the goal, it is on occasion not possible to achieve because of conditions beyond the captioner's control.

While some may argue that completeness is an integral component, and that verbatim is the baseline to be achieved, we maintain that while verbatim is the goal, it is on occasion not possible to achieve because of conditions beyond the captioner's control.

Such conditions may be rapid speech which is poorly articulated, simultaneous conversations between people on air, unfamiliar names or words not provided in preparatory material (assuming such material is provided by the broadcaster, which in many instances it is not), and poor audio. The national telecommunication infrastructure continues to degrade, and telephony providers using digital switching systems continue to grow, making conventional (i.e. copper/analog) phone line infrastructure increasingly difficult for captioners to obtain. The quality of existing analog-based phone connectivity/systems varies around the country, and the resultant impact on the caption data stream (evidenced by disconnect, line noise) impacts on the captioner's ability to create high-quality captions, and captions which do not contain "errors" caused by the technical factors cited above, attributable to the infrastructure. Notwithstanding the aforementioned, if wrong words are used, or key words are missed which impact on a viewer's understanding, then contextual correctness has not been achieved, and the captioning would be, by definition, not functionally equivalent to the audio available to a hearing viewer. Also, since the implementation of digital transmission, other issues such as latency (delay in caption stream caused by mpeg codec compression) have arisen that captioning providers are inappropriately held accountable for.

     In our 2005 comments, we suggested that a real-time captioned broadcast must be 95% accurate to meet a functional equivalence requirement. Over the past 5 years, MCS has developed a two-tiered process for evaluating real-time captioned broadcasts. We arrive at accuracy percentages by tallying errors in an unedited ascii file of a broadcast, divided by word count.

Over the past 5 years, MCS has developed a two-tiered process for evaluating real-time captioned broadcasts.

We consider spelling errors, incorrect use of homonyms, word boundaries, hyphenation errors, and formatting errors in this computation. A second analysis of the ASCII text printout is compared to the tape of a broadcast. We measure the variance in accuracy percentages, total words captioned, using both methodologies to determine whether the percentages correlate and are statistically significant. The file reviewed against a tape or digital recording invariably has a slightly lower percentage than one reviewed and evaluated using errors divided by total words. By evaluating the taped broadcast against the text, we can assess not only contextual accuracy but other potential issues that may have affected the ability of the captioner to produce accurate captioning, i.e., clarity of speech, rate of speech, quality of audio.

These methods of evaluation are straightforward, and do not require a "caption expert," eliminating the specter of conflicts of interest in evaluating a company's work product.

An analysis of a one-half hour news file containing between 2800 to 3400 words requires two individuals committing two to three hours per half-hour program. These methods of evaluation are straightforward, and do not require a "caption expert," eliminating the specter of conflicts of interest in evaluating a company's work product. Nonetheless, they are timely and expensive, and such quality-control processes can be a substantial economic burden on captioning companies.

     We believe that a functionally equivalent guideline for real-time captioning requiring 98.5% accuracy is reasonable, and would not be counterproductive. Over the past five years, we have seen viewer's expectations increase for higher quality captioning, which we have met. However, there is still a significant problem with some consumers having unreasonable expectations as to what they should reasonably expect from real-time captioning. Many viewers, consumers and broadcasters, are not fully aware of the unique skills required to provide real-time captioning. Real-time captioners are not providing transcript-quality text in the real-time captioning process -- the training required to real-time caption derives from stenographic theory utilized by court reporters, but the individuals providing real-time captioning are not providing real-time transcripts. This can lead to unrealistic expectations and are part of the reason "standards" are not appropriate. Real-time captioners are not providing a product that can be benchmarked -- we are not manufacturing a screw to a precise specification, nor are we creating and/or using spectrum frequency which can be measured with precision.

     MCS believes the guideline for post-production captioning should be set at 99.9% accuracy. Post-production captioning, typically used on syndicated programming, commercials, and feature films, is created with software used by professionals using a different skill set than real-time captioners, and are relying on a pre-prepared text to create a caption file.

     In conclusion on this point, we believe that the FCC needs to implement guidelines to address the problem of quality in real-time captioning which has arisen because of the economic/competitive issues we have discussed, which have provided disincentives for real-time captioners to enter the industry. In this respect, the need for guidelines is addressing the byproduct of market distortions which also need urgent action by the FCC.

     d. Complaint procedures and the abuse of the FCC electronic filing process

     In February, 2010, the Commission implemented a more robust electronic complaint filing process. We believe that the electronic filing process, which empowered consumers by enabling them to file a complaint directly to the FCC, was well-intentioned and necessary.

The complaint process, however, has also enabled certain consumers to use or threaten the use of the FCC complaint process with consequent fines in a manner not intended by the FCC.

Deaf and hard-of-hearing consumers have been frustrated for years by unresponsive and/or indifferent parties in the caption distribution chain, who would not be responsive to legitimate consumer complaints. Even though video programmers originating programming have been responsive to consumers, other captioning entities in the distribution chain have not been so concerned. The complaint process, however, has also enabled certain consumers to use or threaten the use of the FCC complaint process with consequent fines in a manner not intended by the FCC.

     We have seen at least one circumstance in 2010 where a viewer has exhorted a local news station to change their captioning company, or face the possibility of having a complaint filed. In this instance, the viewer was implicitly using the FCC complaint process as a tool to extort the local news station, and/or inviting tortuous interference with a business relationship. This viewer may be acting as an individual, or more likely than not, as a "shill" for another captioner or captioning company.

We have strong reason to believe that captioners who are instigating the filing of such false complaints are captioners who have seen their income reduced by 50% per annum over the past 5 years, and are promoting the filing of specious complaints against broadcasters, cable and broadcast, to induce programmers to change their captioning relationships.

Also, some captioners, as we have read in captioning on-line forums, have encouraged their compatriots to file complaints to the FCC on captioning issues which are specious, and derive from technical issues beyond the control of the captioner. We have strong reason to believe that captioners who are instigating the filing of such false complaints are captioners who have seen their income reduced by 50% per annum over the past 5 years, and are promoting the filing of specious complaints against broadcasters, cable and broadcast, to induce programmers to change their captioning relationships. We understand this has become more widespread since the implementation of the FCC electronic reporting process in February, 2010. We are requesting the FCC adopt a fining procedure against false, malicious claimants who are abusing this process. The prosecution of individuals and/or companies that abuse the reporting process must not be feckless. WE would urge remedies against such malicious claimant to include prosecution under the RICO statutes where evidence of conspiracy, or intent to conspire for an illicit purpose in interstate commerce, can be proved beyond a reasonable doubt.

     e. Availability of captioners, impact of standards on supply of captioners, economic disincentives for real-time writers to enter and stay in the profession.

     Since 2005, we have seen several changes in the composition of the real-time captioning labor pool. By 2006, there were a sufficient number of real-time captioners providing captioning services. However, as the economic situation changed resulting in a decline in advertising dollars from 2007-2009, several captioning companies changed their compensation structure, in some instances dramatically reducing per-hour compensation to captioners. At the same time, newer entrants to the real-time captioning marketplace using newly emerging voice captioning software technologies entered the market, offsetting to some degree, attrition by real-time captioners who left or were exiting the profession to provide more lucrative real-time court reporting, freelance reporting (i.e., depositions), and CART reporting in educational settings.

     The NCRA (National Court Reporters Association) had anticipated the need for more real-time writers as early as 2003 and pursued a lobbying effort with Congress to obtain earmarks for several millions of dollars through 2010. A typical earmark to a court reporting school, for example, would amount to $500,000. An NCRA-approved court reporting school that typically would have 250 to 350 students would fit the profile of such an institution receiving such an earmark.

Although intended to expand the pool of caption writers (and political support from Deaf and hard-of-hearing associations was solicited for this reason), the schools (with a few exceptions) have not produced real-time captioning graduates in large numbers.

The moniker for this legislation (apart from earmarks) was the Real-time Reporters Act, with the intended purpose of training a cadre of real-time writers in programs offered at NCRA-approved court reporting school captioning programs. Although intended to expand the pool of caption writers (and political support from Deaf and hard-of-hearing associations was solicited for this reason), the schools (with a few exceptions) have not produced real-time captioning graduates in large numbers. In a court reporting school with 250 students, for example, a completion rate might be 20% at the high end. Students who entered the federally funded captioning program of such a school might number 20 or 30 students, of which three or four individuals might graduate with the requisite skill set to be a real-time captioner. In effect, in many cases, the federal government would have spent $125,000 to $165,000 to train a student to become a real-time captioner. Given the diminishing incentives to enter the business, such students generally choose CART or the legal profession, where opportunities for greater income than captioning abound. We have not seen documentation from NCRA that would disprove these pass rates, which we have corroborated with current and former court reporting school owners.

     We believe, as noted above, guidelines are necessary for real-time captioning. As we have also noted, the economics of the real-time captioning profession have deteriorated such that even the few graduate candidates from captioning programs are not incentivized to enter the captioning profession, to offset the replacement of current captioners leaving the profession for greener pastures. Continued debasement of the economics of the real-time captioning profession, including unreasonable performance requirements for less income, will cause the profession to reach the tipping point very soon, where the replacement rate of individuals entering the captioning profession will not offset attrition. Clearly, we are not expressing a concern for caption writers who do not have the requisite skill to meet the necessary minimum quality guidelines which the FCC may consider. We are concerned with correcting the anticompetitive processes in our industry which have resulted in declining income potential for the highly talented writers currently in the real-time captioning profession, and talented individuals considering real-time captioning as a career.

     f. Imposition of FCC fines and current market trends towards indemnification to broadcasters in contractual obligations for fines.

     As MCS has noted, there are significant instances of abuse of process where viewers are threatening broadcasters with complaint filings to the FCC unless defects/errors in captioning are corrected, including threats to file such complaints unless the caption vendor is to be replaced. We ask the FCC, how many "disinterested," competent parties have the expertise to evaluate compliance with FCC guidelines, let alone evaluate numerous specious complaints filed by parties with potential conflicts of interest.

We ask the FCC, how many "disinterested," competent , parties have the expertise to evaluate compliance with FCC guidelines, let alone evaluate numerous specious complaints filed by parties with potential conflicts of interest.

In addition, at least one network has included/required indemnification provisions - i.e., to be made whole if the FCC levies fines. There are no safeguards in place to prevent parties from filing claims who stand to benefit by harming captioning companies if fines are imposed, which may be passed on to the captioning company. The FCC must, therefore, exercise considerable discretion before levying fines based on failure to conform to FCC quality guidelines, assuming such guidelines are adapted, or face the specter of litigation where it is named as party in such a proceeding. Captioning companies which are providing high-quality captioning cannot be held hostage, nor operate effectively in an industry where the profit potential is declining where the risk of failure to perform (in the opinion of evaluators who may not even understand or appreciate the difficulty of real-time captioning) could result in fines imposed on a network that are passed through to the captioning company.

The FCC must, therefore, exercise considerable discretion before levying fines based on failure to conform to FCC quality guidelines, assuming such guidelines are adapted, or face the specter of litigation where it is named as party in such a proceeding.

These indemnification provisions are found in more than one network's contractual provisions, and this practice may well further diminish the interest of captioning companies to bid on a programmer's captioning business in the near future. In addition, prior to the imposition of any fine, a broadcaster needs to be given an opportunity to correct the defect claimed, and to demonstrate whether the claimants concerns have been responded to, or are reasonable and have a basis in fact.

     In 2010, it should be noted to the Commission that a well-known real-time captioning company, Visual Audio Captioning, a woman-owned business founded by Tammie Shedd, a highly respected captioning professional with years of experience at NCI, exited the real-time captioning business. MCS was instrumental in helping Visual Audio begin their business in 1998, and gave Tammie Shedd's fledging firm encouragement to begin her business, including work opportunities. We understand Visual Audio's decision to exit the real-time closed-captioning business was in no small part related to the destruction of economic value of real-time captioning, and declining income opportunities for employers and employees in the captioning profession. This is but one salient indication of how market disincentives are impacting on the viability of small to midsize captioning companies, and the decision to remain in business, that the FCC should take due note of.

     The FCC should also understand that in the period 2005 through at least 2008 certain companies (which are also dominant in providing closed-captioning services) have received substantial compensation from the Department of Education through grants for providing video description services.

We have long wondered how certain companies, dominant in providing closed-captioning services, could provide pricing to networks, at or below their operating costs, or offer barter schemes to increase market share.

We have long wondered how certain companies, dominant in providing closed-captioning services, could provide pricing to networks, at or below their operating costs, or offer barter schemes to increase market share. During the period 2005 through 2008, the Department of Education paid under Federal grant awards between $1900 to $2400 per hour to certain captioning/video description companies who were particularly adept at massaging the Federal grant udder. Since money is a fungible commodity, we can speculate that firms receiving such generous compensation for video description services were able to sustain a loss, or subsidize their captioning bids to provide captioning at an operating loss because they were

Since money is a fungible commodity, we can speculate that firms receiving such generous compensation for video description services were able to sustain a loss, or subsidize their captioning bids to provide captioning at an operating loss because they were able to receive such extravagant compensation from the Department of Education.

able to receive such extravagant compensation from the Department of Education. MCS has the documentation to prove these per- hour rates were paid. Also, we wonder how Deaf and hard-of-hearing groups can tolerate and/or appreciate why video description services are valued 21 times more per hour than the average rate paid for real-time closed-captioning services to broadcast and cable networks (when they do pay for services, as opposed to using advertising barter schemes).

     g. Remedies and suggested action by the FCC and additional oversight by the U.S. Congress

     MCS urges the FCC to implement the following measures in Rulemaking to address the concerns and market inefficiencies noted above in the following manner:

     (1) The FCC must amend the definition of "undue burden," retaining the upper limit 2% of gross revenue as the maximum cap on expenditures for closed-captioning, but requiring a minimum expenditure of 1% of gross revenues of a network, with such minimum expenditure requirement for captioning being waived if a network or cable video provider expends 25% of its total costs for closed-captioning with small captioning companies, not dominant in the closed-captioning business, and representing companies of diversity. MCS does NOT believe in quotas, but we believe small, minority and/or women-owned companies (which comprise the majority of companies in the closed-captioning industry) deserve an opportunity to compete, and provide closed-captioning services if they have the capacity to provide high-quality captioning. They are being closed out of opportunities to compete, and not incentivized to form companies which can be innovative and cost-effective. We want the FCC to establish a level playing field so that through market competition the closed-captioning industry can better serve consumers now, and in the future.

     There is precedent for this administrative remedy -- the Dodd Frank Act of 2010, in Section 342, mandates accessibility through diversity offices established in 20 Federal agencies. This proposed Rulemaking would ensure opportunities to compete for small, mid-sized captioning companies NOT DOMINANT in the business. This must be implemented by the FCC to ensure the viability of the closed-captioning industry. The overwhelming majority of vendors and service captioning providers are small businesses -- in fact, most are very small businesses with 25 or less employees, and many of whom are companies who represent diversity -- minority and/or woman-owned businesses.

     In conclusion, MCS has been fortunate to have clients who appreciate the high quality of our services, and we greatly appreciate their commitment to an entrepreneurial company such as MCS, representing diversity.

The answer is simple -- no small businessperson who plans on being in business for a long duration will borrow money without the prospect of paying back a loan. Closed-captioning companies, which can be engines for innovation and growth in hiring, are no exception.

The current administration has touted the importance of small business in job creation. In fact, the current leadership has been puzzled over why small businesses will not borrow to create jobs, and to act as the engines of growth in our economy. The answer is simple -- no small businessperson who plans on being in business for a long duration will borrow money without the prospect of paying back a loan. Closed-captioning companies, which can be engines for innovation and growth in hiring, are no exception.

     We urge the Commission to implement the above-noted measures with all due speed to facilitate an economic recovery in our industry, and guarantee the long-term economic viability of the closed-captioning industry by ensuring opportunities for small captioning companies to compete for, and provide, real-time captioning services to broadcast and cable networks.

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