Broadcasting (Oct 1931-Dec 1932)

Society Offers Press Special Rates Politics Over AU Stations Exempted From Royalty Fees ; Meeting Called to Organize New Association Mr. Mills By SOL TAISHOFF OPENLY favoring newspaperowned broadcasting stations, E. C. Mills, general manager of the American Society of Composers, Authors & Publishers, has offered them music license fees on livhich the royalty percentage basis s reduced sharply and sustaining :ees are cut in half. , This contract has been offered :o 35 stations in recognition of ^Lhe "substantial contributions to -:he promotion of the art and inlustry of music made by newsoapers in the way of general propaganda continuously appearing in heir columns in support of various and sundry musical activities." instead of requiring payment on heir receipts from the sale of all ,.heir time, as Mr. Mills has demanded of all other stations, the lew contract asks a royalty only Tm the time actually using ASCAP topyrighted music. It is estimated hat the reduction, aside from the iO per cent cut in sustaining fee, will be about one-third. At the same time, announcement ivas made of a meeting for the uganization of a new association o be composed exclusively of newspaper-owned stations to be held in I he Hotel Sherman, Chicago, Oct. I 19. It is presumed the meeting , jwill consider the Mills' offer and ieel out the sentiment for such ■ i new association. In his letter offering the new jjijrontract, Mr. Mills said a committee of three had worked out the j.iew scale with him. He named ft "-I. Dean Fitzer, WDAF, Kansas R ;ity Star; Walter Damm, WTMJ, Milwaukee Journal, and Lamb^'lin Kav, WSB, Atlanta Journal, jo Excepts Politics 4CN AN unexpected move evidently 2-"'lesigned to ward off attacks from tWj politicians, Mr. Mills announced BflPct. 10, in a circular to all licensed m nations, that ASCAP will waive m he collection of the royalty as far inks political addresses are con1 t-rned. Mr. Mills emphasized, how:r, that the formula endorsed ai joy the NAB nevertheless provides i ■ ' hat a percentage is to be paid « to ASCAP of "all net receipts in !*J-espect of all programs without a Exception for which the time is 'sold." T^ji Stations were instructed in accounting forms provided by AS, Hj^AP for net receipts to eliminate '.jii'all straight political programs reIBfardless of the party affiliations j» >f the speaker, and regardless of j*t vhether as an incident to such '^'programs music copyrighted by '■■ nembers of the Society is used." -Citations which already have made omittances of percentages in reI pect to such programs hereafter . endered were notified to ;laims for refunds. Mr. make Mills added, however, that such refunds will be made with the distinct understanding that if at the time the sale of facilities was made the political party or candidate who purchased this time was charged an additional music license fee "the amount thereof shall be refunded by the station." Mr. Mills said that this action was taken in the belief that a substantial public service is rendered to the nation by political candidates in their discussions through radio of government problems, and that the Society desires to support "in every consistent manner the dissemination of such information and to contribute our bit toward the service of the people." More than 100 stations owned or operated by newspapers have been invited to the Chicago meeting. While the invitation is understood to have stated that the proposed new organization would in no way conflict with the NAB, this view is not shared by NAB officials and by certain independent stations. The invitation also is understood to have cited the copyright fee revision as a sample of what a newspaper-broadcasting association can accomplish. Some Papers Balk SEVERAL influential newspapers, it is known, will not accept the proposed newspaper-contract in the wray it has been offered, fearing that it will undermine the industry and that it is a part of an attempt by ASCAP to split broadcasting ranks. While the view naturally is prevalent that no station can be blamed for making the best possible deal, some non-newspaper stations have expressed resentment toward Mr. Mills' discriminatory move and are delaying the signing of their contracts. In a letter to Broadcasting, Mr. Damm, a former president of the NAB, and now a member of its board, declared that the proposed new organization is not intended in any way to affect the situation of those stations who already are members of the NAB. "Nor is the organization planned in opposition to NAB or any other radio interest", he said. "This group holds the same relation to other broadcasting stations as the '100,000 group' of American newspapers does to the American Newspaper Publishers Association. There are certain problems which the newspaperowned radio stations have that do not affect other radio stations, or if they do affect them, at least not in the same way. Non-Newspaper Views "THERE is no spite or any other feeling of that kind involved. Any station which is owned or controlled by a newspaper will be eligible for membership although there has been some talk of only one paper in a town being invited. That is something that will have to be determined later on." Non-newspaper stations feel that they are entitled to the same concessions given newspaper stations. They have insisted, in letters to Oswald F. Schuette, NAB copyright director, to Mr. Mills and to others that the percentage should be charged only on actual receipts from programs in which copyrighted music is performed, that line charges properly should be deducted, and that full commissions for procurement of business, rather than a single 15 per cent, should be deductible before the percentage is computed. Since most of these concessions have been c-iven the newspaper stations, it will mean, in practice, according' to Mr. Schuette, that newspaper stations can sell their time at 3 per cent less than other stations, unless similar treatment is accorded all broadcasters. Many stations have decided to pass along to their clients the 3 per cent royalty for the first year of the three-year 3-4-5 per cent ASCAP music contracts since an absorption of the tax by the stations would in a number of cases be almost ruinous. Mr. Schuette and Mr. Mills were to have continued their negotiations, which have centered around the percentage levy for all stations only on time in which ASCAP music is used, on Oct. 3, but Mr. Schuette found on arriving in New York that Mr._ Mills was indisposed at his farm in the suburbs. He was to confer with the ASCAP official again beginning Oct. 13. . Throughout the negotiations, Mr. Mills has assured Mr. Schuette that the signatures of individual stations on their contracts will not in any way prevent reductions or revisions of specific phases of the scale, or even of a basic revision of the contract such as to cover royalties only on ASCAP music rather than receipts from all commercial time. Mr. Mills, according to Mr. Schuette, has committed himself and ASCAP to the position that such benefits will be extended to all stations, regardless whether they have signed contracts. Assumes Approval IN HIS letter to newspaper-owned stations, Mr. Mills said he assumed that all newspaper-owned stations would approve the new formula. At the conference with the committee of three newspaper-station managers, he said the ASCAP desired to give "practical effect" to its recognition of the contribution of the newspapers to music "through a concession to newspaper-owned stations in the relative amount of fees to be paid by such stations for license to use music copyrighted by members of the Society in their performances. It has been previously informally agreed by a representative of the NAB that in principle the Society may properly recognize this situation in the manner proposed with out being charged with discrimination", the letter said. Text of Offer to Press THE FORMULA offered the newspaper-stations, follows in full text: (a) Licenses to be for a period of three (3) years, effective October 1, 1932. (b) Sustaining fee to be 50% of the rate at present paid by the station. (c) In respect of commercially sponsored programs, the station is to pay 3% of the gross amount of receipts from the sale of time covering programs in which music coming under the Society's license is used, up to an amount equal to fifty (50) times the sustaining fee; and 5% of amounts received in respect of such programs in exeess of fifty (50) times the sustaining fee. (d) In any event, the minimum fee payable under the license during any year of the agreement shall be not less than four (4) times the sustaining fee thereunder. (e) The license is to be limited strictly to licensee and not to run to successors and assigns — in other words, the continuation of the license depends upon the continued ownership and operation of the station by the newspaper. (f) It is distinctly understood that amounts received in respect of commercial announcements (known as "spot" announcements) interpolated between musical programs or either directly preceding or following musical programs which use compositions copyrighted by members of the Society shall be subject to payment of the percentage charge, except that public service announcements such as time signals, weather and market reports shall be exempt from such payments. (g) It is also understood that incident to the broadcasting of political conventions and meetings, civic gatherings and such like affairs, and sport broadcasts such as football and baseball games, etc., and as well parades and public functions, music played by bands attendant at such events, regardless of whether it includes music of the members of the Society, shall not subject such program to payment of the percentage. (h) The newspaper-owned station is construed, under this understanding, as being any broadcasting station 51% or more owned and operated by a daily newspaper. No station shall be construed as newspaper-owned or controlled which merely has a lease upon all or a portion of the time of the said station. (i) No percentage shall be payable in respect of service charges connected with the bringing of a non-commercial program from a remote control point to the studio of the newspaperowned station. Stations to which the contract was offered are: WIBA, WDEV, WCAX, WTJS, WQAN, WKY, WFBE, WSJS, WINS, WBEN, WELL, WTAG, WFAA, WTMJ, WWJ, WSBT, WSB, WMC, WJAG, WISN, WHAS, WGN, WDAF, WDAE, WBAP, WAAF, KSD, KPRC, KLX, KGW, KFBK, KMJ, KTAR, KFUL, and KFIZ. While preliminary study is being given by the NAB and the networks to the creation of a radio music reservoir through a whollyowned music subsidiary, to rid the industry of the ASCAP hold, no definite project has been formulated. Reports circulated along Tin Pan Alley that definite propositions have been made to publishers are branded as false and premature. The whole question will be a main topic of consideration before the NAB convention at St. Louis next month. ^October 15, 1932 • BROADCASTING Page 9