Broadcasting Telecasting (Oct-Dec 1957)

be limited in ownership to one television station until such station had been operated for a full license term. Thereafter, the owner might apply for an additional station each year, subject to the other limits of the multiple ownership rule, including the presumptions recommended herein. 32. The present numerical limitation that no licensee may own more than 5 vhf stations and 2 uhf stations should be retained. In addition, it is recommended that the multiple ownership rules be amended to provide that no licensee be permitted to own more than 3 vhf stations in the top 25 markets of the United States. To the limited extent that divestiture is required by this proposed rule, a reasonable period of time, such as three years, should be permitted for the sale of the stations. 33. Networks should be treated on the same basis as other multiple-station owners with respect to all of the above-recommended rules. However, in the event that networks, having disposed of station holdings in excess of three in the top 25 markets, should seek to acquire additional stations in lower-ranking markets up to the permissible limits of 5 vhf and 2 uhf stations, the presumptions against a network multiple owner on local ownership and diversity grounds should, in a comparative hearing context, be overriding unless it can be demonstrated that acquisition of the station or stations is essential to the financial welfare of the network and that financing from conventional capital sources is not available. I. Radio 34. The Commission should undertake a detailed study of network radio and of other components of the radio industry. J. Application of Commission Rules directly to Networks 35. The Commission should recommend to Congress that it be expressly authorized to apply the pertinent parts of its rules and regulations directly to networks. The official views of the Dept. of Justice should be requested before such a recommendation is made. 36. Pending any such recommendation or express grant of authority to apply its rules directly to networks, it is recommended that the existing chain broadcast rules continue to be applied to stations, and that all changes in the rules or new rules recommended in this report be made applicable to all stations, or to stations owned by the networks, as the circumstances warrant. 37. Should express authority be granted to the Commission by the Congress to apply its rules directly to networks, the Commission should then review its Chain Broadcast KCRA-Tv SACRAMENTO, CALIFORNIA . . . the highest rated CLEAR JSE station in the West! ing Rules, as they may have been amended or expanded, with a view to making them applicable to networks only, to both networks and stations, or to stations only, as the conduct reached by each rule indicates. ill. Enforcement It is axiomatic that no rule can be effective unless it is properly enforced. In the past, several factors have complicated the Commission's task of effectively enforcing the existing Chain Broadcasting Rules. One of these factors is that the sanctions applicable under the rules have not generally been suited to the types of infractions against which the rules are addressed. This problem has two aspects: some of the rules are directed against the injured parties rather than against the parties most likely to have been responsible for the infraction of the rule; and the penalties imposed under the rules are excessive for most of the infractions involved. Another factor is that the Commission has been able, because of other and more pressing tasks, to devote only limited staff and funds to the continual observation of industry practices necessary for effective rule enforcement. As has already been pointed out", the Chain Broadcasting Rules are framed in terms of station licensees, and provide that no license shall be issued to a station which engages in any of the proscribed practices. The types of practices against which the rules are directed generally involve a contract, understanding, or agreement between a station and a network, and the rule could thus be directed against either party. In practice, however, there is little reason why a station should wish to engage in most of the proscribed practices, while there is a greater incentive for a network to do so in order to limit competition from other networks or from non-network sources. In cases where a station licensee has violated a Commission rule at the instance or insistence of a network organization, penalization of the station rather than the network clearly poses a problem of equity which can interfere with effective rule enforcement. A rephrasing of some of the existing and proposed rules to address them to networks as well as. or in lieu of, stations, as recommended in Chapter 14 of this Report, would make it possible to apply sanctions directly against those parties most likely to be the moving parties in violations of some Commission rules. Regulations directed against stations may have a considerable, if indirect, influence on the networks with which they are affiliated. In instances where a rule infraction has been initiated by a network organization, it would presumably not require revocation of many station licenses for strong pressures to be brought to bear by affiliates on the network to discontinue the practice in question. Nevertheless, the Commission may understandably be reluctant to revoke the license of a station in such circumstances. On the other hand, if the evidence should indicate BR OA DC A SI ING CHANNEL rELECASTINC -Chain Broadcasting Rules were issued bv FCC following 1938-1941 investigation. In lieu of applying rules to networks, Commission laid down rules applicable to stations and designed to prevent stations from entering into arrangements which restrained them in exercise of their public interest responsibility. PROMOTION & MERCHANDISING Spectacular award winning promotion . . . Exclusive super market and drug chain merchandising — these are the big "live" extras that go with your best buy in Houston — KTRK-TV — the station with nine lives ! ! ! KTRK-TV CHANNEL 13 HOUSTON October 7, /957 • Pnge 103