Broadcasting (July - Dec 1942)

deference to the Committee, he was opposed to any moves which would mean throwing that task aside, Rep. Youngdahl (R-Minn.) interposed he was very much interested in that statement and that it was "absolutely correct". Then Rep. Youngdahl asked why the FCC should not postpone the network monopoly rules until the war is over, on the same premise. Mr. Fly said the study had been completed for more than a year and that there was no work to be done. In a detailed interchange, Mr. Youngdahl said it is still up to Congress to pass on the question and that he had been very much impressed with the calibre of witnesses who had appeared before the Committee and who had the public and war interests in mind. These witnesses, he said, thought much confusion and disturbance would result and that it was his feeling the Commission would do well to suspend the regulations for the duration. "That's a lot of moonshine," Mr. Fly retorted. When Rep. Youngdahl commented: "That's your opinion," Mr. Fly countered "That's a fact." There ensued a discussion of availability of stations on networks for public service broadcasts and congressional speeches. Mr. Youngdahl took the position that while time unquestionably could be cleared for the President, stations generally would prefer the "dollar sign" to speeches of lesser lights. Mr. Fly, however, insisted that as good as, if not better, coverage could be counted on for such programs under the rules. Stations generally want to carry such features and are not primarily interested in the return, he insisted. He said the issue was being narrowed to whether Congress wanted the networks to force stations to take programs against their will and better judgment as to what is in the public interest. This point, however, was not pursued by Rep. Youngdahl. Recalls Reaction Of Senate to Claims Chairman Fly said that stations generally, in his judgment, preferred good public service programs A MOTHER who has lost a son in this war gives her aid in raismg finances for the war effort. Mrs. George B. Cannon, mother of Lt. George Cannon, first Marine to die in the defense of Midway Island last Dec. 7, looks over the script for the Bondwagon, program originated by CKLW, Detroit, and carried by all the city's stations: Watching are (1 to r) Frank Burke, CKLW production chief; Ivan Frankel, radio director, Simons-Michelson agency, Detroit; and Woody Herman, bandleader. to programs "from Hollywood and Broadway". He disagreed that the network rules would cause any confusion, pointing out that he had "lived with these monopolies for a number of years". He again discounted the predictions of ruin and disaster to business. The Senate considered the same issues presented to the House Committee against the monopoly rules and disagreed with the major networks and with Commissioner Craven's views, he added. Irrespective of whatever Messrs. Sarnoff or Paley think, Mr. Fly contended, the arguments against the rules "do not amount to a hill of beans". He added that the question of profits is not being dealt with, but that he thought the networks would stand to make more under the rules. "It wouldn't hurt if they made less," he said, reiterating previous testimony that "these big outfits make a 60% return on their investments." If MBS, with its physical setup, can get along under the rules, Mr. Fly said he thought it followed that the two big network companies can make plenty of money under the same conditions under which MBS has "hobbled along". Moreover, he held that better programs would result from the competition. Rep. Youngdahl pursued his contention that the rules should be suspended because of the fear of upsetting the system during war, but Mr. Fly insisted that if the Congressman read the FCC's monopoly report, "you'll be on my side". "I suppose that after the rules, the next step will be the breaking down of clear channels," Mr. Youngdahl commented. Alluding to his testimony of the preceding day on clear channels, Mr. Fly said that the FCC does not propose to do anything on that subject during the war, because of its preoccupation with other things. Control Of Foreign Language Outlets Rep. Kennedy (D-N.Y.) asked in a general way about control of foreign language stations and the policy of licensing new stations. Mr. Fly explained the present voluntary controls set up by the foreign language group, under FCC scrutiny. Rep. Sanders (R-Pa.) alluded to Chairman Fly's testimony on exclusivity and option time. He asked whether it would not be possible for networks, by the payment of option money to purchase time, to acquire what amounts to exclusive time anyway. Mr. Fly indicated this presumably could be done, but held that under the FCC rules stations would assume their proper license obligation. When Rep. Wadsworth reopened the Lowell Thomas-Sun Oil case and asked whether Mr. Fly proposed to suggest that the sponsor be compelled to cover a larger territory, Mr. Fly reiterated he did not know the solution. He said it might mean a rebroadcast for the [BWflF national coverage or cooperative local sponsorship, as is being done on certain other news programs. He said there was no way Congress or the Commission could force such a situation, although it might be done by legislation. The FCC newspaper-ownership investigation was reopened by Rep. Brown (R-0.), who pointed otit he had been absent for some days because of a flu attack. Chairman Fly reiterated his previous testimony that the FCC should dispose of the matter within a very few months. He said it may well be that the Commission will refer the whole matter to Congress and "put it right in your lap", or it may decide it has jurisdiction and take other steps. Chairman Lea thanked Mr. Fly for his detailed testimony and the Chairman said he stood at all times ready to appear before the Committee. He said it was his plan to maintain a "closer contact" with the Committee to advise it of the work of the FCC. Craven Favors Changes In Operation of FCC Calling Commissioner Craven to the stand. Chairman Lea commented that it was "wholesome" to have members of the Commission express their own opinions as individuals and that it was "far better to have men of that type than men who sacrifice too much in the interest of unity and harmony." Mr. Craven read a statement, prepared by himself, covering all controversial phases of the FCC's functions. He commended Chairman Fly's leadership but suggested changes in FCC operation to eliminate confusion growing out of varying interpretations. He supported the Sanders Bill and made a number of suggestions. He explained why he had opposed the FCC majority's chain monopoly report and held that some form of option time was essential in the proper conduct of networks. Mr. Craven alluded briefly to his background of 29 years of service in communications and his service as a member of the FCC since 1937. He regarded the Commission as an agency created by Congress to administer policies established by Congress and not as an agency i empowered to promulgate new "social-economic policies." When ■ the Commission encounters conditions and problems not foreseen at| the time basic legislation was enacted, he said, it seemed most de ' sirable that it should return to; Congress for further instructions. Mr. Craven described the Com-i munications Act of 1934 as excellent legislation, but pointed out, that some parts of the Act may. require clarification and some re-; Basic Mutual Network Outlet . _ . _ FULL TIME THE 5000 WATT \foUeUthe hi'Bies ROCK ISLAND • DAVENPORT • MOLINE Page 60 • July 6, 1942 BROADCASTING • Broadcast Advertising