Broadcasting (Oct - Dec 1950)

Radio's post-war "holiday" was over in 1949 as the nation's economy meshed gears and swung about from a buyers to sellers market. Competition was back in advertising media as in every business endeavor. Broadcasters and advertisers were warned that each medium had to pull its own weight. While approaches for tapping new advertising sources were sounded by radiomen, the advertiser wanted to know what his radio and TV money was returning him in dollars and cents. The time was ripe for extra eifort along the radio sales front. Temper of the times called for economy; an inevitable impact was felt in network and station operations. To add to usual broadcaster woe was the rising threat of television inroads in radio markets. That few TV stations were making money didn't help his outlook. But the second half of 1949 found the economy steadying with signs of a general upswing. At summer's end, spot and local business were brisk; broadcasters found TV hadn't cut so deeply in the radio dollar. Evidence appeared that new money was finding its way into television, some of it from media other than radio. The networks, however, more closely tuned to national business gyrations, were oif 13.9 9f in actual sales as compared to the pre-fall period in 1948. Television and Radio Set New Records Vital statistics on AM, FM and TV stations showed 1949 as a year when TV kicked off its baby shoes, while AM, shaking down after the post-war "Gold Rush" for new stations, retained its leadership. World War II ended with 950 AM stations on the air. At 1949's beginning, the count was up to 1,911 AM, 698 FM and 51 TV stations; by yearend the totals were 2,087 AM, 744 FM and 97 TV stations in 57 markets. A radio-TV set record output by manufacturers was reported for fall months in 1949 with the year's totals at AM, 6,391371; AM-FM and FM only, 875,505; TV, 2,413,897. While total production was below 1948's output, average dollar value had increased as TV output comprised the large share of the total. An unabated spiral of operating costs in 1949 plagued broadcasters. While gross broadcast revenues from time sales shot up an estimated 4.5% to $435 million in 1949, operating costs correspondingly rose 4% in the year. National spot business continued upward in the year, increasing 13%. But overall average of station profits, before federal taxes, had fallen well below the 20% mark for the second consecutive year. Total network billings amounted to $187,830,799, a decrease of 5.6% from 1948 which had an all-time record volume. Mixed feelings clouded tTie issue of whether radio could withstand the TV boom. In any ease, video was chalking up an impressive record. In the first quarter of 1949 alone, 14 more TV outlets made appearances. Set owners had increased some 450,000. Time sales surpassed the $5 million level. Sponsors increased from 680 to 1,027 with the number of hours doubled. TV families had grown an estimated 500% from July 1948 to the corresponding month ini 1949. Gill Survey Shows AM Listening Unshaken The Gill Survey in June came up with figures showing AM listening in TV homes jumped back almost to former levels 9 to 13 months after a TV set was installed. The survey was conducted by Sam Gill, director of research, Sherman & Marquette, New York. Talent war among networks, eyeing choice Sunday nighttime audiences, boiled over before the year was a month old. CBS, with its Jack Benny, Bing Crosby, signed in January, and Amos 'n' Andy acquisitions, had NBC against the ropes Hooper-wise. Chief negotiater for CBS was William S. Paley, board chairman. The talent transactions came under study of government tax experts who ruled Mr. Benny subject to personal income levies, excepting Amos 'n' Andy package as capital gains (a difference of as much as 50% in Uncle Sam's take). The Bureau of Internal Revenue in May closed the door on inclusion of capital gains in contracts in the case of Fibber McGee & Molly and NBC. In late January CBS signed Edgar Bergen, who did not return to the air until fall. Red Skelton, Ozzie & Harriet and others. NBC prepared to review its program aims following the CBS talentpath blazing, by presenting to affiliates in the spring plans to revitalize a drive for new program development, simultaneous AM and TV personality-p r o g r a m growth and policy labeling lavish investments in talent as unsound practice. Realignments Started Within NBC Structure But the networks had other pressing problems in their own organizations In May NBC released an estimated 60 employes in a step toward cutting its overhead $1 million. Meanwhile, the firm of Booz, Allen & Hamilton, management consultants, were making a study of the entii'e NBC operation. NBC's revamp started in October with a new president, Joseph Mr. McConnell H. McConnell. Three months earlier, Mr. McConnell had been elevated from vice president in charge of RCA finance to vice president of the firm, third in command to Brig. Gen. David Sarnoff, board chairman. As McConnell became president, Niles Trammell, NBC's president nearly 10 years, was made NBC board chairman. NBC's reorganization was a continuous process wherein three self-contained units were set up: AM, TV and high-level management. In the realignment, Sylvester L. (Pat) Weaver, formerly vice president and radio-TV director of Young & Rubicam, became vice president in charge of television. Frederic W. Wile Jr., agency's supervisor of radio-TV operations, accompanied Mr. Weaver to NBC as the latter's assistant. Dr. Stanton, of CBS, signed a $1 million contract to continue as president at a base salary of $100,000 a year for 10 years. CBS lumped news and public affairs for radio and TV under a single command late in June. In September Howard S. Meighan, CBS vice president and general executive, was made chief CBS officer on the West Coast. Among first executive changes was ABC's reassigning Charles C. Barry, vice president in charge of western operations, to head up all TV operations; Ernest Lee Jahncke Jr. to chief of AM-TV stations department; J. Donald Wilson to vice president in charge of programs. Transactions on the stock market by ABC executives renewed talk that ABC was thinking of a sale to 20th Century-Fox film company. But in the spring, Mark Woods, ABC president, scuttled talk and announced renewed effort on the program and facility front. ABC acquired in May the old Warner Bros. Vitagraph Studios in Hollywood for use as a TV center. Mr. Woods was signed to a $75,000 a year contract with ABC the same month. Frank K. White, president of Columbia Records Inc., was elected president of Mutual on April 8, succeeding Edgar Kobak, who had headed the network since 1944. Fort Industry Co., on New Year's Day, simplified its corporate structure by dissolving four wholly owned subsidiaries and placing their radio operations under the parent firm. Stations were: WWVA Wheeling and WMMN Fairmont, W. Va.; WAGA Atlanta, WJBK Detroit. In May, Don Lee Broadcasting System reshuffled its top management, elevating Lewis Allen Weiss, president, to chairman of the board; Willet H. Brown, executive vice president, to president. FCC's problems in the year included opening of the color television question; issue of proposed TV allocations including UHF and VHF; a new Mayflower Decision; proposed ban on giveaways, and preliminary plans to reorganize. In May, FCC grouped all its major TV problems into a proposed single proceeding but underscored its intention not to lift the VHF freeze before a definite timetable was set for a final decision on combined UHF-VHF allocations. It later announced color, as the first of the TV subjects on the agenda, would be heard Sept. 26. Prior to FCC's opening of Pandora's color box, the Radio Mfrs. Assn. and the National Bureau of Standards began studies of their, own. Sen. Ed C. Johnson (D-Col.), Senate Commerce Committee chairman, was reported by Broadcasting early in May to have re(Continued on page 160) Mr. White BROADCASTING • Telecasting KROD carries more spot advertising than any other El Paso station. The reason is simply that KROD, being the favorite with more responsive listeners in this area, does a better job for advertisers. That's why spots on KROD have more pulling power — actually cost you less per dollar of sales volume in this vital market. KROD CBS, EL PASO KEY STATION, SOUTHWEST NETWORK 5000 WATTS 600 TOP O' THE DIAL RODERICK BROADCASTING CORP. DORRANCE D. RODERICK, Prejidenf VAL LAWRENCE, Vice Pres. & Gen. Mgr. REPRESENTED NATIONALLY BY THE O. I. TAYLOR COMPANY Sciober 16, 1950 • Page 159