Broadcasting (Jan - June 1941)

CONTRIBUTION to the safety of Boston was made by WORL in the form of this six-foot sign carrying a graphic message to drivers, placed strategically in trafRc-laden Kenmore Square near the WORL studios. At dedication broadcast were (1 to r) Station Manager George Lasker, Fred Bailey, director of WORL "M-1 Safety Squad" having 25,000 members; Ed Dinsmore, announcer; Deputy Supt. O'Dea, Boston police. switched from the Red to the Blue and 29 from the Blue to the Red. A total of 19 programs had switched from NBC Red to CBS and 17 from NBC Blue to CBS. A total of 29 programs were switched from CBS to NBC Red and 10 from CBS to NBC Blue. Two programs had switched from NBC Red to MBS and one program from MBS to NBC Blue. Commenting on Chairman Fly's praise of the cooperative type of network operation, as reflected in MBS, Mr. Trammell said that if that pattern of broadcasting service is to be followed, it would produce networks without central studio facilities, undertaking no engineering developments, contributing nothing to research or new service, as contrasted with the large sums poured into such activities by the "pioneer networks." MBS, he said, has complained that its ability to compete has been hampered by the older networks. Yet, he said MBS in statements to the advertising trade, "refutes its own complaints." He mentioned statements in MBS advertisements that it is "America's fast growing network," that it covers 227 of the first 300 markets," that "two new network advertisers select Mutual for every one who selects any other broadcasting firm," and that it has "regular network coverage of 70% of the nation," and "73% of all retail sales." Yet, Mr. Trammell said, "Mutual cries that competition has been unfair." Chairman Fly, Mr. Trammell charged, seems to feel that station contract affiliations should be altered and the Blue Network disposed of in order that Mutual may be able to place its service on larger stations and in more markets. "In other words, Chairman Fly agrees with Mutual that they have gotten along pretty well, but apparently, he and the Commission want to help them do better and at the expense of the Blue Network." Fears the Red May Be Next Urging that if a separation of NBC is to be forced, it should be done only after legislative as distinguished from administrative action, Mr. Trammell declared that if the C ommission is allowed to compel disposition of half of NBC's property and if Congress does nothing about it, "don't be surprised, if six months from now, Mr. Fly comes in and tells us to get rid of half of the Red Network." He observed it would be too late to protest "because his power has been conceded." "Nowhere in the history of administrative regulation," Mr. Trammell charged, "has so brutal a method for the amputation of a major portion of a great private enterprise been invoked." in effect, he said, Chairman Fly proclaims: "Bend your knee, concede my power, give up the Blue, and I will let you live — you may keep the Red." If Congress by failure to act now concedes to Chairman Fly the power to force us to give up half our property, then Congress need not be surprised when it learns in the not-too-distant future, that Chairman Fly has taken over the entire radio industry, Mr. Trammell shouted. Taking up the rule which would ban ownership of stations except in three key cities, Mr. Trammell said that key stations have been fundamental in network broadcasting as originating centers. Pointing out that NBC has ten managed and operated stations, he said the original grants of license by the FCC and the annual renewal of each, is evidence that operation of the stations has been in complete accordance with the law. NBC does not understand any reason for, or the justice of the Commission's order which, he said, decrees in effect that the Commission will deny a license for any station to a network organization which operates another station in the same area or will refuse to renew a license to NBC to operate a single station in any area where other stations are few in number or less strong in power than the station now operated by the company. Penalizes Pioneer In Favor of Newcomer This rule deprives NBC of the right to operate any station in Washington, Cleveland or possibly in other major markets. Again, he charged, the only justification is "the vague charge of domination, of monopoly, of control and of rendering too exclusive a service." Declaring the rule simply takes from one to give to another, Mr. Trammell assailed it as penalizing the pioneer in favor of the newcomer. The exchanges place good service for something unknown and destroy under terms of forced sale, investments made during years of creative work, an energetic effort to build up the stations. "Finally," he declared, "it destroys all faith in the fairness of a regulatory body which, when the risk is great and revenues non-existent, encourages a citizen to ac quire a license, only to deprive him of it years later because he has been successful." Insisting that the public would not benefit, Mr. Trammell asked whether this was a game where private enterprise, operating under the regulation of a Commission with a mandate from Congress to 'foster and encourage the art' is first to be invested in and later "kicked out"? NBC, Mr. Trammell testified, currently is licensed to operate in New York two standard broadcast stations, two international stations, a frequency modulation station and a television station. The latter two are non-revenue producing and already represent substantial investments with profits a long way off. Under the new regulations, the FCC says it is bad policy and against public interest to operate more than one standard broadcast station in New York but in the public interest to operate the other non-profit making stations, he went on. While the new rules apply only to the standard broadcast band, he said that if the same reasoning is followed, more new rules can be issued at any time to deprive NBC of any and all of the four stations in the other fields. "I think it is plain, gentlemen," Mr. Trammell said, "that the new rules issued by the Commission are not only destructive of the present system of network broadcasting in the standard band, but also of the future service in the high-frequency band yet to be created." Sees Inconsistencies In Cleveland Cases Attacking the "Cleveland situation", previously cited as an outstanding case wherein MBS has been unable to get a fulltime outlet, Mr. Trammell said that in effect the Commission is trying to force NBC to sell the 50,000-watt WTAM, when years ago it could have granted additional facilities in the city. After he had recited several instances in which the FCC had denied applications for new stations in this city on one ground or another, he declared there are still pending two applications for new regional stations which, if granted, would provide adequate facilities according to the Commission's conception of adequacy. All told, he reported an examination of the record shows that since 1930' there have been 19 different applications for an additional station or for fulltime on a present station in Cleveland and that the Commission either has rejected the applications or taken no action. Senator Wheeler interposed that he could not understand why the FCC will make a grant in one case and deny in another on substantially the same set of facts. Alluding as he had in the past to "politics" in FCC actions. Chairman Wheeler said that in some instances the Commission makes grants without hearings and in others requires protracted hearings at great expense to the applicants. He said there should be a general rule that would apply to the poor or rich, influential or those without political backing, on an equal basis. "I think it is outrageous now," he said. Senator White observed that as long as the chairman "talked that way" he would remain quiet and simply agree with him. The clear-channel situation also entered the affray when Chairman Wheeler said that he felt the Commission had been somewhat derelict in pronouncing policy in that regard. He said he did not believe, however, that a station in Boston would interfere with a clear-channel station on the Pacific Coast and that greater service would be rendered. Mr. Trammell, in his recital of several denials of applications for new stations in Cleveland, pointed out that in certain instances the Commission had assigned as reasons the fact that service would be limited to the 4.8 millivolt line at night. This limitation has since been frequently exceeded in other locations, even to the extent of interference to the 9 or 10 millivolt line, he said. Westinghouse Shifts Interest Wheeler At the outset of the Wednesday afternoon hearings, Senator Wheeler, reading from a memo, inquired about the shifting of KDKA, WBZ and WBAL to the Red from the Blue, pointing out that the Farm & Home Hour thereby loses highpower outlets and rural audience. Mr. Trammell explained that KDKA and WBZ were being shifted to the Red upon insistence of Westinghouse, which has resumed their operation after a period of NBC management, and said otherwise, "we stood to lose them to a competitor". Asked why, if the Blue is such a good network, the owners wanted them on the Red, Mr. Trammell replied, "because they make more money on the Red. We've never contended otherwise." Mr. Trammell added that the staffs of Red and Blue were separated as soon as he became president a Page 46 • June 23, 1941 BROADCASTING • Broadcast Advertising