Broadcasting Telecasting (Apr-Jun 1957)

who are in daily contact w ith broadcasters, of the great demand for good television programming material. Since the earliest days of this new media program shortages have been a problem for television station owners. The networks have done an excellent job in producing more and more attractive live programs. Film syndicators have contributed their part to make the tv fare more palatable: and many stations produce a portion of their own programs. But until the libraries of the major movie producers came onto the market about a year ago. all television stations were in constant search of additional, suitable programs to broadcast. The need was especially great among unaffiliated independent television stations which do not have access to network programs. "Advent of first-class feature films on television last year proved conclusively that tv audiences enjoy and want these films. Today, despite their age. feature films are avidly sought after by the television industry. There is now little doubt that this product holds a place of great economic importance in the television industry. "It is the position of the Antitrust Division that compulsory block-booking of copyrighted feature films is just as illegal in the television industry as it was in the theatre industry. We wish to insure that television broadcasters will not be subject to the type of economic restraints that encumbered motion picture exhibitors . . . "Perhaps it is not surprising that the attitude of some distributors of feature films is one of confession and avoidance. They admit that the\' have sold their films in large blocks but denv that anv broadcasters were compelled to take any undesired films and contend that every one of their purchasers are satisfied customers. "We do not wish to prevent television broadcasters from purchasing as many feature films from one distributor as they choose . . . The factual question of whether there has been forced selling of feature film packages is one for the courts to decide. Suffice it to say that we had sufficient credible evidence of compulsion at hand to warrant, in my judgment, filing the suits." THE FIVE ACCUSED FIRMS ISSUE A GENERAL DENIAL A GENERAL denial that they had violated any laws was entered by all the five cited companies. Informed of the antitrust suit. AAP Chairman Louis Chesler pledged "fullest cooperation"' with the government "in continuing a course of conduct for our company . . . in full compliance with law and good ethics." which, he said, has been the policy set by AAP since engaging in the distribution of tv film. Mr. Chesler asserted, however, that in more than $25 million worth of tv "exhibition contracts" some had been made for as little as one picture to a single station as h ell as those consummated for varying numbers. He observed, too. that AAP sold part of its cartoon library, but no feature films, in some Of its transactions, while in others the contracts included feature films, but no cartoons. "Thus." he declared, "it is apparent that no product has ever been forced on anyone." Full compliance with any govern ment request. Mr. Chesler stated, should not affect AAP's future activities or its earnings. AAP's contracts with stations were made to the "full satisfaction of the buyer as well as the seller on a completely businesslike and arm's length basis." Mr. Chesler concluded. Spokesmen for C&C Television Corp. and Screen Gems said they would withhold comment on the government suit until the complaint was served. Screen Gems pointed out. however, that its sales structure has been established to operate "within the framework of applicable trust laws." Ely A. Landau. NTA president, said his company "does not engage in compulsory block-booking. He said NTA's licensees with tv stations usually cover "a number of films." but claimed this "is for the convenience of the stations as well as NTA and is not a requirement of NTA." He added: "The needs of tv stations for continuity of programming which will meet the historic pattern of 13-. 26-. 39 and 52-week cycles makes the sales of films in groups a natural distribution method in the industry, without any element of compulsion. If the government should proceed with the case after acquiring a more complete knowledge of NTA's booking practices, we believe the case can. and will, be successfullv defended by NTA." United Artists had not received the complaint, but a spokesman said. "We have never insisted that any station take all of the 39 pictures. We have sold by selected deal only." UA offers its package, it was explained, on a "selective plan" consisting of six, 13. 26. 39. 52 or "call your own number.*' ADVERTISERS & AGENCIES 3WAY PACT HERALDS NEW VIGOR FOR S-P • Foreign car rights to dealers • Benton & Bowles drops account POSTPONEMENT till late this year of all Studebaker-Packard Corp. advertising seemed imminent, it was learned last week as Benton & Bowles. New York. S-P"s agency, announced Friday it will resign the account effective July 5. Though Benton & Bowles officials declined to discuss the "S-P situation." it wras understood the account was resigned because of a lack of activity on the client's part. A S2 million account several years ago. S-P currently bills less than SI million. However, this is expected to be upped considerably later this spring. The move follows a hectic week of ups and downs for the South Bend automaker, beginning Monday noon with the tri-corporate signing of a multi-million dollar contract between S-P. Daimler-Benz A. G. of Stuttgart. Germany, and its subsidiary. Daimler-Benz of North America Inc.. and the Curtiss-Wright Corp. of Woodbridge. N. J., which assigns S-P all distribution and promotion rights for the premium-priced Broadcasting • Telecasting German auto in the U. S.. Canada. Mexico and Cuba. The contract's signing follows eight months of negotiations and is the first of its kind to place a foreign car in the U. S. market under domestic patronage. The principal force behind the pact is Curtiss-Wright. which for the past year has held an option to purchase S5 million worth of S-P stock at S5 per share and also maintains a management contract with the automaker which gives it supervisor}.' powers. Signatory parties were Carl F. Giese. president of Daimler-Benz (North America). Harold E. Churchill. S-P"s president, and Roy T. Hurley, chief executive officer of Curtiss-Wright. Under terms of the contract (financial terms of which were not disclosed), a newfirm has been set up — Curtiss-Wright & Mercedes-Benz Inc. — which will assume all promotional and distributional activities for Mercedes-Benz products. Effective about May 20. D-B's contract with Hoffman Motors Corp.. heretofore Mercedes-Benz' exclusive U. S. distributor, will expire, and will be replaced by a new one with Studebaker-Packard. giving that firm's 2.400 dealers and distributors the D-B franchise. Additionally. S-P also acquires certain German patents. Eventually. S-P hopes to as semble the Mercedes-Benz in this country. Studebaker-Packard also has made known plans to introduce on the U. S. market a new "economy model" later this year which will retail at SI. 800 — the cheapest U. S. model on the road. This move is interpreted by the auto industry as an effort to bypass American Motors Corp.'s successful Rambler. It also will give S-P the widest price range of any car manufacturer in the country—from less than S2.000 to SI 3.000 (the most expensive Mercedes-Benz made). What this means to the advertising industry is this: • For the time being. S-P will retrench by calling a moratorium on the advertising dollar. This move will be only temporary. • When S-P finds a new agency, chances are the budget will be increased considerably, for the account not only will be for automobiles, but also for Daimler-Benz diesel engines, farm machinery and allied products. This assumption is based on the "probability." to quote one Curtiss-Wright official, that S-P's and CW-MB's advertising will be lumped together. • When the agreement becomes a working one — later this summer — indications point to an eventual resumption of S-P s broadcast activities. The move gives Studebaker-Packard a April 22. 195' • Page 29