Broadcasting (Oct - Dec 1950)

COURT UPHOLDS FCC Approves Color Order, Bars Commercialism L DECISION upholding FCC's aproval of the CBS color television rvstem but prohibiting commercial peration pending a ruling by the ". S. Supreme Court was handed own Friday by a three-judge fedlal court in Chicago. The court dismissed the comlaint in which RCA, NBC and ?.CA Victor Distributing Corp. sought to upset FCC's color decision. But it also continued its temporary restraining order against commercial use of CBS color until yext April 1 or such time as the Supreme Court dissolves the re^Istraint. I The action, on a 2-to-l vote, a ilittle more than five weeks after [the argument, was widely interjpreted as a serious blow — if not a jfenockout blow— against color TV jlor the duration of the present *mergency. The majority decision itself said !one reason for extending the restraining order was the growing .phortage of electronics materials •and manpower. ! "It is a matter of common knowledge that the situation . . . becomes knore acute with each passing day, fend the prospects are that it will re far worse before it is better," ithe majority said. "It is hardly conceivable that ,ieither the Commission or the ■jgovernment would under such cirKumstances desire, much less insist, hat the order in controversy be ade effective." Both sides are free to appeal the ecision to the Supreme Court — OA on the dismissal of its comjtolaint, and FCC on the extension of ^fche temporary restraining order. Appeal Seen Certain I The certainty that an appeal Ns-ould be taken, regardless of the ecision, raised questions in the udges' minds as to "why we should evote the time and energy which ;he importance of the case merits," or they felt that the Chicago base "is little more than a practice ^]feession where the parties prepare End test their ammunition for the big battle ahead." Circuit Judge J. Earle Major iftTote the majority opinion for .himself and District Judge Philip tSullivan. \ District Judge Walter LaBuy jjdissented, labelling FCC's color dejcision "precipitous" and arbitrary, and holding that its enforcement should be restrained. "There is ample basis for the conclusion that the scientists laboring in the laboratories of the industry may soon resolve the problem of compatibility," Judge LaBuy said. "In view of the admittedly tfluid state of the art, it is difficult to understand why the Commission refused to hear additional evidence and chose instead a course of action, rising its own words, based on 'speculation and hope rather than on demonstrations.' " ; The court refused to consider Pilot Radio Corp.'s charges that Sen. Ed C. Johnson (D-Col.), chairman of the Senate Interstate & Foreign Commerce Committee, put undue pressure on FCC to adopt the CBS system. Subpenas for correspondence between Sen. Johnson and the FCC and CBS were quashed. On this score the majority noted that no participant in the suit charged that FCC was "influenced, cajoled or coerced by Sen. Johnson or anybody else." Nor was there any other charge or "even an intimation" that FCC did not act in good faith, the decision added. Condon Report The majority also said it had no authority to consider the so-called Condon Committee's color TV report to the Senate commerce committee, although "no doubt this report refutes numerous of the findings made by the Commission and gives a far more favorable appraisement of the RCA system than that attributed to it by the Commission." Nor did the court give weight to RCA's protest that E. W. Chapin, head of the FCC laboratories, invented an automatic adapter useful with the CBS system and was allowed nevertheless to continue participation in the case. The opinion said: It appears to us that the interest of the witness if it had any relevancy went to the weight or credit to be given his testimony, and that this was a matter for the determination of the Commission. In any event, it furnishes no basis for invalidating the Commission's order. Emphasizing the limited scope of its authority in reviewing administrative agencies' actions, the judges quoted from several Supreme Court opinions, including one which said the judgment of such an agency, "if based on substantial evidence of record, and if within statutory and Constitutional limitations, is controlling even though the reviewing court might on the same record have arrived at a different conclusion." The court did not agree with RCA that it could receive testimony from RCA as part of the trial: "We reiterate that under wellestablished principles our function is to hear and determine the questions before us solely on the record made before the Commission." In the majority's view, two courses were open: (1) Dismiss the complaint, or (2) set aside FCC's decision and send the case back for further consideration in view of recent developments. "A pursuance of the latter course," the opinion Said, "assuming we have such authority, of which there may be doubt, would inevitably result in the prolongation of the controversy which badly needs the finality of decision which can be made only by the Supreme Court. "In other words, the interests of all, we think will be better served with this controversy on its way up rather than back from whence it comes." The majority recognized apparent "inconsistency" in its decision to dismiss the complaint and yet stay the operation of CBS color. Conversion Cost Cited But, the court reasoned, there are now no sets outstanding which are capable of receiving CBS color in either color or black-and-white, and to convert the estimated 9 million existing black-and-white sets to receive color in color would cost $1% billion. Further, the court said, manufacturers would need six to eight months to get adapters and converters on the market. The opinion continued: So it seems reasonable to conclude that if the [FCC] order was now in effect, there would be no broadcasting under the proposed standards for many months, for the simple reason that there would be no sets capable of receiving such programs. And it does not square with common sense to think that manufac turers would rush into the business either of manufacturing adapters and converters for existing sets or manufacturing sets with built-in adapters and converters while this controversy is pending. And to maintain that the public in any considerable number would purchase adapters and converters, assuming they were available, under the existing state of doubt and uncertainty, is to cast a reflection on the intelligence of people. To FCC's contention that the color decision should not be stayed because delay will encourage further sales of unadapted black-andwhite sets, the court replied: This argument is based on the assumption that the Supreme Court will sustain the validity of the order. It ignores a contrary possibility. Certainly this court is possessed of no such omnipotence, and we doubt if the Commission is. Even if the order was in effect the owners of existing receivers could not within the next several months obtain the equipment which would enable them to receive the authorized broadcasts. But assume that they could and did so. Where would the public find itself in the event the order was held invalid by the Supreme Court? The majority felt that "the public interest in this matter has been magnified far beyond its true perspective." Any merit which exists in the contention that manufacturers stand to gain financially by delay in the production of color sets, the decision held, "is completely overshadowed by what appears to be evident, that is, that the contest is mainly between two great broadcasting systems for a position of advantage in this rapidly developing field of television." The opinion said that "perhaps the most substantial attack made upon the Commission's order is the adoption of standards which call for an incompatible system which, as admitted by all the parties including the defendants and CBS, is less desirable than a compatible (Continued on page 66) nson Cites Senate Work ALTHOUGH the war situation may preclude introduction of any color system for the foreseeable future, Chairman Edwin C. Johnson of the Senate Interstate and Foreign Commerce Committee believes that his committee's activity in TV resulted in "speeding up the timetable several years." Participating in a forum on color TV conducted by the District of Columbia Bar Assn. over WWDC Washington Dec. 17, Sen. Johnson said he was pleased with the vast improvement made in the RCA color system, based on the most recent demonstrations. He said he felt that the color was "not quite as good as the CBS picture" but that while there is the advantage of compatibility in the RCA system, he "wouldn't say whether it was acceptable." Stuart L. Bailey, of Jansky & Bailey, Washington consulting engineers, and last past president of the Institute of Radio Engineers, likewise stressed the improvement made in the RCA system, but added that from his observations he felt that RCA "could not meet the FCC requirements" as to minimum criteria even with its present system. The improvement in color fidelity, however, he said, was marked. Both Sen. Johnson and Mr. Bailey agreed that color is only a part of the TV proceedings and that RCA, of course, is interested in the entire project. Mr. Bailey com iTelecasting • BROADCASTING mented that black-and-white TV is still the "bread and butter" and that RCA probably had not asked for a re-hearing because it did not want to delay the allocation proceedings and a final decision. They agreed also that there might be "plenty of time" in which to appraise the whole matter, in view of cut-backs in production occasioned by the national emergency. Sen. Johnson commented that some of his own constituents were very anxious to have the proceedings closed, looking toward operation of stations in Denver and the Colorado area. Sen. Johnson made mention of (Continued on page 72) December 25, 1950 • Page 61