Broadcasting Telecasting (Apr-Jun 1957)

GOVERNMENT continued It would, however, never attempt to substitute its own judgment of what is or is not a violation of the antitrust laws for a final decision on this point by the Courts . . ." The Commission added: "The Commission has no special expertise on antitrust matters." Referring to the 1952 McFarland Act amendments to the Communications Act, the FCC noted that Section 3 1 1 was amended to remove from Commission jurisdiction the application of revocation sanctions against licensees found guilty of antitrust violations. This was on the ground that it was unfair to subject broadcasters to double jeopardy, since Section 313 of the Communications Act applies all antitrust laws to licensees and empowers the courts to revoke broadcast licenses as part of the final decree. The FCC's document was the most recent extensive treatment of the subject of antitrust matters since the 1952 report on the application of a uniform policy on antitrust violations, and the 1953 decision approving the merger of ABC and the then United Paramount Theatres Inc. The 1952 report emphasized that antitrust violations will be considered as a por tion of the character qualifications of an applicant, and that each case must be decided on its own merits. The Commission did insist, however, that monopolistic practices, whether or not found illegal by a court, would still be of concern to the FCC as an indication of how an applicant might operate a broadcast facility. In the ABC-UPT case, the Commission found that although UPT and its former parent. Paramount Theatres Inc., had been found guilty of antitrust acts, this did not disqualify UPT as a licensee. The Kansas City Star Co. (Kansas City Star and Times) was found guilty in 1955 of antitrust violations in a criminal suit brought by the government. The government charged that the newspaper pressured advertisers not to use competing media, forced advertisers to use both the morning Star and the afternoon Times and also offered combination rates for both newspapers. The newspaper was fined $5,000 for monopoly in the dissemination of news and advertising, and Emil A. Sees, Star advertising director, was fined $2,500 for attempted monopoly. A charge against Roy Roberts, Star president-general manager, was dis missed. This decision was affirmed by an appeals court in January this year. Next step is expected to be a government motion for summary judgment in a companion civil suit based on evidence in the criminal trial. The government has asked that the Star be forced to divest itself of both WDAF radio and tv, and that the Star and Times be separated. WDAF properties are understood to be available for an asking price in the neighborhood of $10 million. Two weeks ago nine Philadelphia stations were fined $1,000 each after they pleaded no defense, and their trade association $5,000 after it pleaded guilty for an antitrust violation which was viewed by Federal Judge Allan K. Grim and Justice Department prosecuting attorneys as a technical violation involving no moral turpitude. The charge was that the stations conspired to fix charges when station managers signed a joint telegram to Dancer-Fitzgerald-Sample, Chicago, that they would stick to published time rates and observe a fair trade code. The code had been formulated through the association. Still outstanding is a companion civil suit which asks that the stations' practice be DEFEND YOUR FREEDOMS, CRAVEN CHARGES BROADCASTERS CRITICISM both of the FCC for getting into the area of program censorship and of broadcasters for not fighting such encroachment was voiced by FCC Comr. T. A. M. Craven before the MarylandDistrict of Columbia Radio & Tv Broadcasters Assn. at Ocean City, Md., June 14. Following, an excerpt from his remarks: HITHERTO I have treasured the thought that our system of broadcasting was based upon private enterprise competing freely among themselves for public favor with the minimum of interference from the governmental licensing authority. I believed that broadcasters had the inherent right under the Bill of Rights of the Constitution of our country to broadcast programs of their own choice without fear of reprisal from the Communications Commission for what was said. I thought that Section 326 of the Communications Act which forbids the Commission from promulgating a regulation or fixing a condition which interferes with the right of free speech was specifically designed to insure that broadcasters, in spite of the fact that they were licensed by the Commission, had the same rights as the press under the First Amendment to the Constitution and that they would be free from fear of government reprisal for broadcasting programs of their own choice. Of course I know that broadcasters cannot, with impunity, violate penal laws applicable to everyone. Now what has happened? We have the so-called "Blue Book" of the FCC which, in effect, fixes standards of programming. The Commission has regulations with respect to some of the business aspects of broadcasting. With the consent of Con gress, the Commission has a full-scale investigation now going on with respect to other business aspects of broadcasting. Committees of Congress are concerning themselves with several other aspects of broadcasting. Now, I am not questioning the perogatives of Congress and I am satisfied that it is motivated by what it believes to be the demands of the public. However, in this connection I consider the industry to be its own worst enemy. For this trend toward more and greater government control of the economic aspects of broad COMR. CRAVEN CaS^ to be inspired to a large extent by the actions of certain elements of the broadcast industry itself. After acting with what was supposed to be prudent business judgment, certain entrepreneurs discovered that their judgment just didn't pan out as they originally expected. Consequently they ran to the government to bail them out. A few others who enjoyed more fortunate economic situations took advantage of every legal procedural device in the Communications Act to stop competition. Still others seek and encourage the Commission to engage in economic planning through the assignment of channels to the various markets. Is this indicative of the pioneering spirit which carved this country out of the wilderness and made it great? Another matter which gives me painful concern is the apparent confusion and indifference which appears to grip the minds of many broadcasters. How many are willing to fight to preserve their rights under the Constitution with respect to freedom of expression? How many want the Commission to refrain from engaging in economic planning for the broadcast industry? And then again how many would prefer that the Commission give them economic protection over and above the existing laws relating to unfair trade, restraints upon competition and other unlawful monopoly which apply to all business enterprises? What more do those broadcasters who seek economic protection or control of competition desire? And what price are they willing to pay for such protection? Will these broadcasters surrender their rights under the First Amendment to the Constitution which the press holds dear? Will they accept the inevitable consequence of economic protection wherein the radio licensing authority regulates their rates and business practices and otherwise plans their business? Hitherto I have felt strongly that successful radio broadcasting in this country depended upon the confidence of the public in the independence of the broadcaster from government control of the expression of opinion and news. The public's confidence in this independence is the vital difference between the American system of broadcasting and that which prevails in other countries. In the past, I have fought for the principle of no interference by the Commission with either the programs or the business of broadcast licensees. One of my problems now is to determine whether I should continue this fight if the broadcast industry itself is apathetic. Page 66 • June 24, 1957 Broadcasting • Telecasting