Broadcasting (July - Dec 1938)

Nets, Affiliates to Consult on Policies Agreement With IRNA Brings Harmony in Negotiations; Committees Named; FCC Inquiry Seen Oct. 10 REVISION of network affiliated station relations whereby the outlets themselves will be consulted through committees on all matters of policy, has been agreed to in substance by NBC, CBS and MBS with the permanent Independent Radio Network Affiliates. Coming as a prelude to the FCC chain-monopoly inquiry which gets under way this fall, preliminary agreements have been reached with the major networks by the IRNA Executive Committee on a harmonious basis. In speedy fashion, IRNA organized itself as a permanent section of the NAB at a special convention in Chicago Aug. 16, held its preliminary conversations with the major networks five days later, and reported the matter informally to the FCC, all within a fortnight. Formal network acceptance of committees designated by IRNA to carry on the unprecedented deliberations is expected to come at a conference of network executives with Samuel R. Rosenbaum, chairman of IRNA and head of its executive committee, shortly to be held. Date of Hearing Meanwhile, action by the FCC chain-monopoly committee on a definite date for the hearings was being awaited. It appeared the date might be Oct. 10 or Oct. 17, since it hardly would be possible for the Commission to give the requisite month's notice and still draft its detailed bill of particulars by setting a date any earlier. Chairman Rosenbaum, after consultation with the newly elected officers, Mark Ethridge, WHAS, Louisville, vice-chairman of IRNA, and L. B. Wilson, WCKY, Cincinnati, treasurer, named the three committees designated to confer with networks on matters of policy. The NBC committee comprises Rosenbaum, chairman, Paul W. Morency, WTIC, Hartford; Walter J. Damm, WTMJ, Milwaukee; William J. Scripps, WW J, Detroit; Robert T. Convey, KWK, St. Louis; Edwin W. Craig, WSM, Nashville; Harold V. Hough, WBAP-KGKO, Fort Worth; E. B. Craney, KGIR, Butte, and Mr. Wilson. The CBS Committee comprises Ethridge, chairman, Vincent F. Callahan, WWL/ New Orleans; Arthur B. Church, KMBC, Kansas City; John A. Kennedy, WCHS, Charleston, W. Va.; I. R. Lounsberry, WGR-WKBW, Buffalo, and C. W. Myers, KOIN, Portland, former NAB president. The committee conferring with MBS to correlate trade practices and general policies of that network with its affiliates comprises John Shepard 3d, Yankee Network, chairman; Gene O'Fallon, KFEL, Denver; Lewis Allen Weiss, Don Lee Network, and H. K. Carpenter, WHK-WCLE, Cleveland. The status of the MBS committee differs somewhat from those of the other groups, since the cooperative nature of MBS does not present the same problems as between network and affiliate. In respect to general trade and competitive practices, however, the effort is to have all networks in agreement. A review of events leading up to IRNA formation as a permanent entity was given William J. Dempsey, FCC special counsel for the investigation, at an informal conference Aug. 26. Messrs. .Rosenbaum, Wilson, and Kennedy, designated as a committee of three, explained the purpose of the IRNA structure and informed him the group intended to participate in the investigation. Networks and IRNA were agreed that a firsthand report of these activities should be given the FCC through its special counsel. Policy Committees Because of the varying nature of network-affiliate problems it was decided to set up separate committees for the three networks. For example, in the case of CBS, the question of optional time differs from that of NBC and Mutual. CBS contracts generally provide for clearance of time on 28 days notice. Recent revisions in CBS contracts, however, permit cancellation of commercials for local public service programs of outstanding importance. Mr. Rosenbaum will have further conferences with Lenox R. Lohr, NBC president, and Edward Klauber, CBS executive vice-pres ident, and their associates in connection with setting up of procedure for the functioning of the newly-created policy committee. A tacit understanding will be sought whereby the networks, before promulgating new policies, will submit them to their IRNA committees and consult with them on all matters having to do with operating practices. Matters which would come within the purview of the committees in their dealings with the networks, according to Mr. Rosenbaum, would include: (1) Network control of station time; (2) interference between local requirements and network demands; (3) station break announcements; (4) commercial announcements during network programs; (5) length and character of commercial announcements; (6) acceptability of commercial copy and products; (7) general program content; (8) responsibility 'for clearance of progrants at the source; (9) tseatment of political broadcasts, both sustaining and commercial; (10) the entire copyright problem including ASCAP renewals and network responsibilities; (11) ownership of stations by network companies in competition with independent affiliates; (12) the whole question of network licensing by the FCC. The precise position to be taken by IRNA at the forthcoming inquiry, Mr. Rosenbaum made clear, will depend on the outcome of the conversations of IRNA committees with the networks. It has been decided to file an appearance, he said. George W. Norton Jr., president of WAVE, Louisville, has been designated special counsel for IRNA and will file an appearance. It is expected that two or three members of the IRNA executive committee will testify, supported by perhaps two dozen affiliates selected because of geographic and competitive conditions. After the IRNA convention in Chicago, attended by 85 station owners or executives and with proxies from a total of 150 affiliated stations, arrangements immediately were made for conversations with the major networks on AS IRNA ORGANIZED AT SPECIAL CHICAGO CONVENTION IRNA OFFICERS — Designated at the Chicago convention of the affiliates group are (1 to r) Samuel R. Rosenbaum, WFIL, Philadelphia, chairman; Mark Ethridge, WHAS, Louisville, and former NAB president, vice chairman, and L. B. Wilson, WCKY, Cincinnati, treasurer. Aug. 22 in New York. In addition to the three officers, members of the executive committee of IRNA, all of whom participated, were Messrs. Craig, Lounsberry, Scripps, Craney, Kennedy, Church and Shepard. Present for the networks were for NBC, President Lohr, and vice-presidents Niles Trammell, Frank M. Russell, and William S. Hedges. For CBS there were Mr. Klauber, vice-president Herbert V. Akerberg, and John J. Burns, special CBS attorney retained for the FCC inquiry and former general counsel of the Securities and Exchange Commission. Appointment of the IRNA policy committees was discussed in detail and tentatively accepted by the networks, pending recounting of the whole development to FCC Counsel Dempsey. Collective Action The Chicago convention, originally scheduled for two days but completed in one, acted on the plan for a permanent organization. It was agreed IRNA should be set up as an agency which could serve on a collective basis on policy for network affiliated stations but not attempt to negotiate individual contracts between stations and networks. Setting up of the organization on a permanent basis was viewed by many who attended the sessions as the "most constructive move" yet made in intra-industry activities. It was emphasized that IRNA, serving as a subordinate unit of the NAB, would in no wise conflict with the functions of the major trade association. It was agreed also that there was no hope of accomplishing the entire objective overnight and that there is no idea of disturbing the present fundamental system of broadcasting. Copyright was discussed freely during the executive sessions. Strong sentiment existed for clearance of copyrighted music at the source whether it be a nationwide (Continued on page i9) BROADCASTING • Broadcast Advertising September 1, 1938 • Page 13