NAB reports (Mar-Dec 1933)

This subject, as it relates to all advertising media, has received extensive study by the Department of Agriculture. Moreover, as a result of this study, a bill has been introduced for consideration by the Congress. The Industry insists, and I think their claims cannot be disputed, that this matter is one which cannot be ade¬ quately treated in any code so as to apply the same principles to ail the different advertising media and that regulation, if found desirable, must be statutory in character. Compliance with the Code, plus voluntary plans for increased network employment will increase by approximately 765 the num¬ ber of persons regularly employed in the Industry. This would exceed by about 350 persons, or more than 3 per cent, the total for anv previous period. It is estimated that total payrolls under the Code will be more than double those of 1929, the peak year in most industries and will equal 93.2 per cent of the payrolls in 1931, a peak year for the Radio Broadcasting Industry, not¬ withstanding the salary cuts in the higher brackets. The effects of the operation of the Code will be beneficial to labor. My best information is that there will not be an increase in rates charged for facilities, so that the consumer should not be adversely affected. The Industry will be required to absorb greater operating costs. Compliance with the trade practices pro¬ visions should be beneficial to both the radio auidences and the Industry. The importance of Article VIII, Paragraph 2, of this Code arises out of the fact that this Industry exists by virtue of licenses issued by the Federal Government pursuant to provisions contained in the Radio Act of 1927 (Title 47, Part 5, U. S. C.). The obligations and responsibilities imposed upon the Industry by that Act, and by the rules and regulations of the Federal Radio Commission made pursuant thereto, make it absolutely necessary to avoid any con¬ flict therewith. OTHER COMMENTS: This is a Federally licensed Industry, subject to rigid obligations to serve the public interest. It should be pointed out that each of the 588 broadcasting stations must seek a renewal of its license to operate every six months; that in practice a great many owners of stations, at renewal periods, are faced with the necessity of prosecuting their applications against some one who seeks to take their radio facilities away from them. Af ten-times such applica¬ tions are frivolous in character. Nevertheless, the licensee, in such cases, is compelled to engage technical and legal aid in order that he may prove his case at a formal hearing which is conducted by the Federal Radio Commission. Frequently, this is so where the Federal Radio Commission, over a period of several years, has found that the station was operated in the public interest. The cost of these proceedings is very great. It requires station owners, through no fault of theirs, to spend substantial sums for the services of expert radio engineers and lawyers, which other¬ wise could be used to engage a greater number of employees with benefit to programs rendered. The Radio Act of 1927 provides for license periods not exceeding three years (Sec. 9). While the Industry was being formed, there could be no question as to the wisdom of limiting license periods to short terms. Today, however, the state of the art, and the power of the Government to revoke licenses for violation of or failure to observe any of the restrictions and conditions of the Radio Act of 1927 or of any regulation of the licensing authority authorized by that Act or by a Treaty ratified by the United States, etc. (Sec. 14) , make short term licenses unnecessary. In view of the com¬ mitment now being required of every broadcaster under the terms of the National Recovery Act, it is a manifest injustice that this Industry should be compelled to measure the existence of every one of its component parts in terms of not more than six months. As a definite part of the national program of recovery and increased stability and confidence, the Broadcasters are clearly entitled to the full term of license provided by Congress in the Radio Act of 1927. I cannot recommend that the Radio Broadcasting Industry be required to make additional fixed and permanent commitments unless it first can be given the full measure of protection pro¬ vided by law. The responsibility for a decision on this point rests with the Federal Radio Commission. However, we are faced with the situation where one branch of the Government (The Federal Radio Commission) is licensing and regulating an industry and another branch of the Government (The National Recovery Administra¬ tion) is making decisions of the greatest importance to that Indus¬ try’s economic existence. It seems only proper, therefore, to sug¬ gest that there should be the closest kind of cooperation between these two agencies. I urge the Recovery Administration to give serious consideration to this phase of the question and to make a proper recommendation thereon to the F'ederal Radio Commission. Except for this point, which is not within the jurisdiction of the National Recovery Administration, I consider the Code, a copy of which is hereto attached, to be fair to both industry and labor and recommend its approval. James W. Baldwin, Industrial Advisor. SUPPLEMENTAL COMMENT ON CODE I have examined the draft of the Code of Fair Competition for the Radio Broadcasting Industry, dated November 18, 1933, and stand upon the conclusions and recommendations contained in my report of November 6, 1933. (Signed) James W. Baldwin, Industrial Advisor. Nov. 21, 1933. INDUSTRIAL EOARD’S APPROVAL November 21, 1933. To: Deputy Administrator S. A. Rosenblatt. From: E. R. Stettinius, Jr. Mr. James W. Baldwin, Industrial Advisor, has approved the final copy (dated November 18, 1933) of the Code for the Radio Broadcasting Industry, and the Industrial Advisory Board hereby confirms this approval. E. R. Stettinius, Jk., Washington Representative, Industrial Advisory Board. TRT:OE CONSUMERS’ ADVISOR’S REPORT November 18, 1933. Memorandum To: Sol Rosenblatt, Deputy Administrator. From: Consumers’ Advisory Board. Subject: Approval of Code for the Radio Broadcasting Industry. The Consumers’ Advisory Board advises approval of the above Code, revised as of November 16, 1933. In view of the widespread public interest in the Radio Broad¬ casting Industry this Board respectfully recommends the appoint¬ ment of a consumer representative on the Code Authority, and is prepared to suggest a qualified individual for such appointment if requested by the Administrator. George B. Haddock, Consumers’ Advisory Board. Ml. LABOR BOARD’S APPROVAL November 18, 1933. To: Deputy Administrator Rosenblatt. From: Labor Advisory Board. Subject: Code of Fair Competition for the Radio Broadcasting Industry. Fourth Revision — November 17, 1933. We approve of the labor provisions of this Code as revised November 17, 1933. Leo Wolman, Chairman, Labor Advisory Board. REPORT OF LEGAL DIVISION N. R. A. Legal Division. Monday, November 20, 1933. To: Sol A. Rosenblatt. From: Legal Division. Subject: Code of Fair Competition for the Radio Broadcasting Industry. The final draft, dated November 18, 1933, of the Code of Fair Competition for the Radio Broadcasting Industry has been ex¬ amined and passed by the Legal Division, subject to the following recommendations : 1. That section 6 of Article VI, third line be amended to con¬ form to Office Order No. 34. 2. Section 5 of Article VI is capable of the interpretation of per¬ mitting the Code Authority to handle labor disputes. This should be borne in mind in the instructions to the Code Authority. 3. Article VII, section 1 (a). This permits five more days than is permitted by policy memorandum in respect to open pricing. 4. Article VI, sections 2 and 3. This does not define the elements of cost in accordance with the policy memorandum. L. M. C. Smith, Legal Division. LMCS:lcb. Assistant Counsel. • Page 239 •