Television digest with electronic reports (Jan-Dec 1959)

5 The Nisforlune of Torlnne': Somewhat sarcastically, but none the less cogently, Corinthian station group’s pres. C. Wrede Petersmeyer takes the editor of Fortune and management of Time Inc. to task for “jeopardizing [their] reputation by publishing an article so obviously biased and distorted as the piece in the Dec. issue entitled ‘Television: The Light That Failed’” (Vol. 14:48, 51). The able young John Hay Whitney partner, plumbing motivations, observes in Dec. 29 letter to Fortune: “If the article dealt with a business other than a competing advertising medium, it might be dismissed as simply a classic example of sloppy and uninformed coverage of the subject. But since the subject is the TV broadcasting business, one cannot escape concluding that the article is a carefully loaded grun aimed at ‘the enemy.’ “I have made a point of checking with a number of people prominent in the TV industry to assess the thoroughness with which your staff may have researched the material for this article. Members of your staff had contacted many of them. All of the men I talked to agreed that any information or opinion given by them to your reporters that was in conflict or at variance with the critical and negative tone of the article had been carefully screened out. It would have been much less upsetting to have found that your staff had merely done a poor job of research, instead of confirming my conviction that the article was designed as an all-out attack on the TV in Swan Song by Harris: The frequently bizarre life of the year-old House Commerce legislative oversight subcommittee (Vol. 14:2 et seq) came to its official end at noon Jan. 3 — with frantic, lastminute deadline filing of sweepingly drastic “reform” recommendations for Federal regulatory agencies — particularly the FCC (see p. 3). “We fully recognize that this is not a complete job and not a complete report,” said Chairman Harris (D-Ark.). “We know we have not covered all that should be covered.” But few FCC areas that were covered — and left uncovered — by his subcommittee in headlined hearings were untouched in 92pp. report. It called for 14 pieces of legislation applying to all Federal agencies, 6 amendments to the Communications Act to correct FCC practices — and for additional House probes (presumably to be carried on by regular Commerce subcommittees) into 8 specific FCC areas that weren’t explored, including “use of the entire spectrum.” Also listed was a set of office rules for FCC to follow. For a time this week it looked like report wouldn’t be ready in time for Jan. 3 filing, as scheduled under House resolution setting up subcommittee. Subcommittee met 214 days, including one past-midnight session, and was still correcting & revising proofs Jan. 2 after Harris had announced Dec. 31 that job was finished. * * * * We obtained copies of revised proofs before they were sent officially to Govt. Printing Office. Subject to additional afterthoughts by subcommittee members, report, in its across-the-board recommendations, calls for: (1) Agency code of ethics enforceable by “civil & criminal sanctions.” (2) Rigid rules for ex parte communications (written or oral) which make unauthorized representations subject to civil or criminal action — and all of them part of public record. (3) Civil & criminal dustry with the purpose of discrediting it, by fair means or foul, with advertisers and the public. “It is fortunate that the management of Time Inc. is in the hands of men whose business judgment is too sound to be swayed by the editorial policy of its own publications. Otherwise, one might expect that Time Inc., in a state of panic over Fortune’s analysis of the financial instability of TV broadcasting and acutely embarrassed over its association with so shoddy a medium of entertainment as that described in Fortune, would forthwith throw on the market the 5 TV stations it has quite recently spent many millions of dollars to acquire. “Should I be as disappointingly mistaken in my confidence in the business acumen of Time Inc. as I was in my previous evaluation of Fortune as an honorable publication, I am sure your parent company will find a host of sound businessmen eager to acquire their TV properties — men, incidentally, with great faith in the future of this medium, who are willing to give of their hard dollars, energy, enthusiasm and loyalty to support that faith.” Note: The Corinthian group now comprises 4 vhf and one uhf station (plus 2 AMs), having this week won FCC approval of its $4,000,000 acquisition of KBET-TV, Sacramento (Ch. 4) — presumably would be glad to “talk turkey” with Time Inc. about buying some of its 4 vhf’s and 5 radios. They’re competitors, incidentally, only in Indianapolis. (For lists of stations each owns, see TV Factbook No. 27, pp. 385 & 387.) penalties for Commissioners & employes who make “unauthorized disclosure of any vote, opinion, or recommendation or information in the Commission pertaining to any proceeding or projected proceeding.” (4) Action within 60 days by Commission on motions in cases. (5) Participation — “as a matter of right” — by Commissions in court cases. (6) Election of chairmen — for 3-year terms — by Commission members instead of appointment by President. (7) Removal of Commission members by President “for neglect of duty or malfeasance in office, and for no other cause.” For FCC alone, subcommittee made these legislative proposals: (1) Section 310 of Communications Act should be amended “to prevent trafficking in licenses” so that sellers or buyers would be required first to get approval from Commission, which would make application and amount involved public. (2) Section 310 clause preventing FCC from considering “public interest” in transfer of license or CP “should be repealed.” (3) FCC should be required to hold public hearings before approving transfers — or at least to put into public record any “special circumstances” which make public hearing undesirable. (4) “Direct or indirect payoffs of competing applicants, except in the proved amount of out-of-pocket expenses,” should be prohibited, as well as “swapoffs between applicants for other licenses.” (5) Public hearings should be held before granting any TV license. (6) Honorariums for speeches, etc., by FCC members should be forbidden. ♦ * * * As for “further legislative inquiry” into FCC areas, subcommittee outlined these subjects for exploration: (1) “Study of the use of the entire spectrum and a determination as to its allocation & use is urgently needed” by Congress, Presidential commission having “natural predisposition of the Executive to favor its own interest.” (2) “A study of the uhf-vhf problem.” (3) Prevention of “nuisance filings” for TV & radio CPs and