Broadcasting Telecasting (Jan - Mar 1951)

Senate Prods House By DAVE BERLYN TESTY overtones began to appear last week in the Senate Interstate & Foreign Commerce Committee's attitude toward the apparent stymie of the McFarland Bill (S 658) in House committee [Broadcasting • Telecasting, Feb. 26, 19, 12, 5]. Underscoring a widening rift between the Senate group and the House Interstate & Foreign Commerce Committee, where the FCC procedural bill is currently at rest, were the following developments: ® The full Senate committee, chairmanned by Sen. Ed C. Johnson (D-Col.), for the fourth time in the past two years, unanimously recommended passage of the radio measure. © As a sequence to this move, the House committee, if it follows its procedure of last year, probably will hold hearings again on the FCC-opposed bill. # Sen. Pat McCarran (DNev.), chairman of the Senate Judiciary Committee, took to task the FCC for requesting action on the radio fraud section of the McFarland Bill in the form of separate legislation. Executive Meeting At an executive meeting Wednesday, the Senate group unanimously reported FCC's monitoring bill, as passed by the House a fortnight ago. The measure (HR 1730) contains similar language already included as a provision of the McFarland Bill. As it did last year, the Senate committee struck the language of the House-approved monitoring measure and attached the pi'ovisions of the McFarland Bill as a "rider." Acting Chairman Paul A. Walker of the FCC had referred to the monitoring bill, which would give the Commission authority to purchase lands and construct buildings for the purpose of monitoring broadcast signals, as essential in view of the national emergency when he appeared before the House committee Feb. 19 [Broadcasting • Telecasting, Feb. 26]. Capitol Hill parliamentarians were quick to point out that the latest Senate maneuver had many overtones. Since the measure reported by the Commerce committee in the upper chamber is a Housepassed bill — and it most likely will pass the Senate with little trouble — the House will have the alternative of (1) appointing conferees or (2) holding hearings on the measure. An identical situation occurred last summer when the Senate passed a House-approved monitoring bill [Broadcasting • Telecasting, July 31, 1950]. At that time, the House committee, chairmanned by Rep. Robert Crosser (D-Ohio), chose to hold hearings. However, a notable change in Page 30 • March 5, 1951 the general climate this year is the emergency nature of the monitoring bill and the anxiety of the FCC to have such a bill passed in the shortest time possible. The House committee moved double-time to clear the monitoring bill for lower chamber consideration early in this session. In effect, this places the upper chamber in the position of demanding some kind of procedural bill be enacted, whether it be the McFarland Bill or some other version — points repeatedly expressed by Senate Majority Leader Ernest W. McFarland (D-Ariz.), author of the measure. Fraud Law Omitted Significantly, the Senate committee this time deleted that section of the bill which provides for the setting up of a radio fraud law, as an amendment to the U. S. Criminal Code. FCC in the past fortnight has asked Congress to enact the measure— separate from the all-inclusive procedural bill [Broadcasting • Telecasting, Feb. 26]. The FCC request for a radio fraud law, similar to the postal fraud law, had been referred to the Judiciary committees of the Senate and of the House. From the NSC GROSS NBC's gross income in 1950 hit an all-time high of $92,373,000, an increase of 27% over the network's 1949 gross sales figure of $72,867,000, according to the annual report of RCA, parent company of NBC, issued last week. On Nov. 15, 1951, NBC will celebrate its 25th anniversary as America's first national radio network, the report noted. RCA also had its biggest business year in 1950, when sales passed the half-billion dollar mark for the first time in the company's history to total $586,393,000, up 48% over the 1949 gross of $397,259,000. NBC accounted for 15.8% of RCA's 1950 gross income, RCA Communications for 2.5% ($14,929,000), Radiomarine Corp. of America for 1.2% ($7,279,000). RCA Institutes for 0.2% ($910,000), with the manufacturing divisions, labs and international divisions making up 81.2% ($476,091,000) and intercompany transactions subtracting 0.9% ($5,189,000). "Television accounted for all of the increase in broadcasting revenue, while radio remained about the same as in the previous year," the report stated. "The value of time sold by the NBC Television Network in 1950 was more than three times that of 1949. The total exceeded that of the next two networks combined. At the opening of 1951 there were 76 national ad latter committee, Chairman Emanuel Celler (D-N. Y.) already has introduced a bill (HR 2948) to accomplish this purpose. But in the Senate, Chairman McCarran has sent a stinging letter to the FCC, admonishing the agency for its failure "to mention the fact that a provision such as you advocate was included as Sec. 19 in the bill S 658, which was passed by the Senate on Jan. 25 of this year and is now pending in the House. . . . Why you should desire the separate introduction of this section when it has already been approved by the Senate once is not made clear." Sen. McCarran's letter continued : In your letter of Feb. 13, you point out that the Commission does not have any criminal jurisdiction in either mail fraud or radio fraud cases; and it is clear the Commission would have no jurisdiction under the provisions of the new Criminal Code section which you have proposed. It seems to me, therefore, that the Commission probably has less interest in this matter than the Dept. of Justice; and certainly, it would seem that the Dept. of Justice, which administers and enforces the Criminal Code, would be the proper agency to transmit a recommendation for the amendment thereof. The Senator also stated that if the fraud law should be enacted it would be possible for a station op erator to justify the denial of using i facilities of his station to "almost i any person or group he wished tc keep off the air" by citing thi criminal provision. He pointed out that the proposes statute "would give the federa government criminal jurisdictior over frauds committed not merelj by means of an agency of the I United States (the mails) but by I means of an agency which the government only regulates." Hears FCC Testimony The Senate Commerce group said it had not included the radio fraud provision of the McFarland Bill in its rider to the monitoring measure since the FCC requested enactment of the fraud law "eight days after, the Senate had passed S 658 . . . i and [the request] was referred to! the Senate Judiciary Committee which plans to study the proposal carefully." The House Commerce group heard FCC testimony behind closed doors on all pending radio matters only nine days before the new Senate committee action. At that time, Acting Chairman Walker presented the FCC's socalled "model bill," containing the agency's own recommendations for a procedural bill. This revived document was said to be the hub of the controversy, which seems to be rising to the surface, between the Senate and the House radio groups. Tops $92 Million in 1950 vertisers using the NBC TV network, more than twice the number (36) at the beginning of 1950." The report gives no breakdown of actual AM and TV income figures for NBC. Publishers Information Bureau data, however, show the NBC TV network gross time sales to have risen from $6,500,104 in 1949 to $21,185,812 in 1950, while NBC's radio network gross time sales declined from $64,013,296 in 1949 to $61,397,651 in 1950 [Broadcasting • Telecasting, Jan. 29]. Commenting on this AM time sales decline of "only 4%" despite the rise in TV billings, the report noted that the average number of stations used by advertisers sponsoring NBC radio programs rose from 113 to 124 in the daytime and declined from 148 to 143 at night. "Total sponsored hours of NBC national network programs at the end of 1950 exceeded by two and one-half hours per week the usage in 1949," the report said. NBC's National Spot Sales Dept. had all-time high revenues in 1950, with total dollar volume for both radio and television surpassing any year since NBC was organized in 1926, the report stated, without divulging the dollar figures. Other NBC data covered by the report include: An increase in NBC employes from 2,879 to 3,482 during 1950, "virtually all . . . attributable to television"; seven new TV stations joined NBC for a total of 63 affiliates, of which 47 are connected by cable or radio relay; nine stations joined the NBC radio network, raising the total to 180; NBC television doubled its output of kinescope-recorded film during the year. RCA Earnings RCA's net earnings, the report revealed, totaled $46,250,000 in 1950, 84% higher than the $25,144,000 reported for 1949. These earnings were equivalent to $3.10 a share of common stock and represented 7.9% of net sales. RCA' during the year declared dividends totaling $17,010,000, compared with $10,081,000 paid in 1949, with $3,153,000 ($3.50 a share) or preferred stock and $13,857,000 ($1 a share) on common stock. RCA's total current assets on Dec. 31, 1950, were $209,959,000. Plant and equipment additions during the year amounted to $20,450,000, compared with $16,340,000 in 1949. For the past 10 years RCA has had an average gross income of $314,486,000, an average net profit before federal income taxes of $38,547,000 and an average net profit after income taxes of $17, j 614,000. Profit before taxes has I averaged 12.2 % of the gross eachi year of the decade, with an an(Continued on page 58) BROADCASTING • Telecasting