Broadcasting Telecasting (Jan-Mar 1962)

BMI CAUGHT IN A SQUEEZE PLAY? continued is one which has been in progress for almost 10 years. This is the so-called "Schwartz case." ASCAP officials deny it's an ASCAP suit, but the society's top management helped pick the plaintiffs: 33 songwriters, all ASCAP members (some now dead), who brought a $150 million suit which numbers among its stated purposes the divorcement of BMI from its broadcast ownership. The case has dragged through 26,000 pages of pre-trial testimony and more than 1 1,000 exhibits — and still hasn't come to trial. There have been recurrent reports lately that the plaintiffs are in a mood to take a token settlement and that the broadcasting defendants may be willing to make one, if only to end the seemingly interminable legal expenses involved. In other forums — House judiciary subcommittee hearings in 1956, Senate commerce committee hearings in 1958, an FCC hearing in 1960— ASCAP has renewed its efforts to rid BMI of its broadcasting ownership. None of these efforts has been successful. Long-Standing Feud ■ Broadcasting's troubles with ASCAP, which led to the formation of BMI, go back to the late 1930's. NAB, unable to get from ASCAP a hint of what fees it would want for licenses to replace those expiring in 1940, adopted a resolution on Sept. 15, 1939, declaring that ASCAP's tactics made necessary "the creation of an independent source of music." BMI commenced operations in February 1940, and a month later ASCAP made known its demands: a doubling of the rates paid in 1939. The broadcasters refused the offer, and BMI, already busy, got busier. When the licenses expired on Dec. 31, 1940, the Jeannie with the Light Brown Hair era began. Stations were forced to rely on public-domain music and such numbers as BMI had been able to pull together. The hold-out against ASCAP continued until the fall of 1941, when ASCAP modified its original demands and a new contract was signed. ASCAP and BMI have operated as competitors ever since — and both have grown consistently throughout the intervening 20 years. BMI claims credit not only for its own growth but for much of ASCAP's. The BMI "open door policy" of welcoming new members has been credited with forcing ASCAP to abandon the "closed club policy" which once made membership difficult and often impossible for writers to obtain. Since 1939 ASCAP's membership list has grown from 1,100 writers and 137 publishers to 5,679 active and 766 non-participating writers and 1,902 publishers in 1961. In the same period BMl's affiliations have grown from zero to approximately 5,300 writers and 4,500 publishers. Broadcasters also claim that through BMI they have cultivated major music forms which are a vital part of the American culture — and that they have done so even though these forms represent only a fractional part of their broadcast schedules. They are especially proud of BMFs work in promoting serious music and American folk music as well as its more general contributions to American musicana, apart from its influence in keeping radio-tv music rates subject to the influence of continuing competition. BROADCAST ADVERTISING Spot tv up 12% for last 1961 quarter MEDIUM ENTERS HEALTHY 1962 FIRST QUARTER AT DOLLAR PEAK National spot television business entered this year at the highest dollar peak on record and indications are for a healthy first quarter (January-March). It's expected that Television Bureau of Advertising-N. C. Rorabaugh in about a week will be able to report spot gross billings of more than $175 million for the three months ending last December. The total will represent an approximate rise of 12% over the like period in 1960 computed on a comparable basis of reporting stations. The 12% hike is the first such spurt of that size in nearly two years. According to past computations, national spot tv billings for the first quarter of 1960 were 12% ahead of the like quarter-period in 1959. But in subsequent comparisons, the quarterly figures showed a general decline, bottoming out in the first three months of 1961 at a time when the recession was felt the most (see chart, page 36). A check of major station representatives and agencies points to a better first quarter this year in spot television compared to the same period a year ago. Business for the January-March period this year, say most of the major representatives, is "well ahead" of pre 30 vious comparable quarters. Estimates vary sharply, the increases ranging from 8% to 25% or more. There were certain signs of a tv spot recovery ahead as long ago as early in the winter. Tv stations then were reported moving into the Christmas holiday advertising season on a wave of national spot business which for most of them exceeded the December-rush volume of 1960 (Broadcasting, Dec. 11, 1961). Third Quarter Gain ■ At that time, third-quarter gross billings for spot were released showing a 1.8 per cent gain over the previous year. In contrast, spot billing for the first six months of 1961 was about 1% below the 1960 level. Spot in 1961 in fact was a notable exception in a year that showed spirited gains in television business. Spot encountered an especially sluggish first half, and the year's gain as a consequence generally is expected to be held at about 2%. Major influences in the current change in spot business as seen by reps and agencies: THE ECONOMY ■ The U. S. economy is in better shape, particularly in tv advertising. (Network, for example, is off to a fast-selling pace for the fall season, also see story, page 36.) Advertisers who look to spot as the way to spread money nationally while bunching it in selected markets are spending again, say some of the major agencies. IMPROVED CLIMATE ■ One agency spot buying executive put his finger one the sub-surface factor. He claimed advertisers have shied from such aderse publicity as quiz scandals, Washington investigations and hearings, and a parroted anti-tv program (and commercial) criticism over a wide slice of the consumer public. Now that the climate is improving, tv once again is getting a friendly look in advertising budgets. NEW PRODUCTS ■ A chief factor, but one that's too hush-hush to get more than a passing reference is the continual issuance of new products by the major advertisers. The marketing strategy today for most mass-produced, mass-sold products includes spot tv in introductory campaigns. The healthier economy is cited by reps as the overriding factor for increased spot television buying. The availability of 20-second spots is men BROADCASTING. March 12. 1962