Heinl news service (July-Nov 1950)

Record Details:

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Helnl Radio-Television News Service 7/12/50 PHONEVISION CREDIT OFFER WITHDRAWN; 11 COMPANIES INTERESTED Zenith Radio Corporation has told the Federal Communica¬ tions Commission that, since the Commission obviously didn't approve, it has withdrawn its "contingent credit" offer to manufacturers for building Phonevision decoder outlets into their television sets. The company said 11 other manufacturers had indicated an interest in installing the outlets but that none had said it planned to participate in the contingent credit plan, under which Zenith offered credits against possible future royalties. The assertions were made by John R. Howland, assistant to Commander E. F. McDonald, President of Zenith, in response to an FCC request for additional information. The Commission is holding up action on Zenith’s request for additional time in which to start Phonevision tests, pending a decision on whether the company has over-promoted its pay-as-you-see TV system in violation of conditions laid down by the FCC. Mr. Howland reiterated that Zenith made its offer to manu¬ facturers because "we believe that by installing the outlets, the public would be saved very substantial expense in the event Phone¬ vision should be ultimately approved and put into operation." The cost of installation in the factory would be between 7 and 25^ where¬ as the cost of adapting sets later would be "substantially greater", Mr. Howland noted. The Commission feared that Zenith's action would mislead the public into thinking that Phonevision has been or will be author¬ ized and pointed out that in authorizing the tests, FCC specified that such an impression should not be created.. Mr. Howland pointed out that the outlets themselves are not patented and that "any television manufacturer is entirely free to install such outlets without the payment of any royalty to Zenith and irrespective of any suggestion from Zenith that they do so." He said Zenith will not encourage the installation of such outlets by any means, "although we believe that our suggestion that such outlets be installed was and still is in the public interest." He said the following manufacturers have indicated inter¬ est in installing the outlets: General Electric Co., Emerson Radio & Television Co., Magnavox, Stromberg-Carlson, Stewart-Warner Corp., Crosley Div. of Avco Mfg, Co., Colonial Div. of Sylvania Corp., Industrial Television, Inc., Wilcox-Gay Corp., and Hoffman Radio Corp. One other "major" TV manufacturer, he said, also indicated interest but asked that the fact be kept confidential. Zenith's Phonevision test, scheduled to be held in Chicago for a 90-day period was originally authorized to start Feb. 8. Zen¬ ith is asking that the start be delayed until Oct. 1st. XXXXXXXX 5