Sponsor (Jan-Apr 1958)

Refusals to clear option time for one reason or another are not exactly widespread but they are not rare, either. For example, testifying before the Senate Commerce Committee in 1956, CBS President Frank Stanton disclosed the following regarding clearances in Class "A" time: of 815 station hours offered to CBS "basic required" affiliates, 91 were not cleared during one week in May of that year. On all CBS affiliates thai week, 524 hours of option time were ordered by network clients but not cleared by stations. The figure of roughly 10% of Class "A" time not cleared is, according to those in a position to know, fairly representative of all the networks. The question of the specific effects on network operation in the absence of option time revolves, of course, around this question of the degree of clearances. In painting a hypothetical picture of a no-option time network of the future, the networks and broadcasters foresee, not a sudden collapse of traditional network operation, but a gradual erosion of pre-cleared time. It has been made clear beyond dispute through the years that the stations want network programs. It, therefore, follows that if option time were abolished the stations would continue taking network programs. However, the option time proponents say, a network is a delicately balanced affair. The fact that a substantial number, or even a majority, of network stations are cleared is not enough. The losses of a few key stations could easily upset a network buy from the advertiser's point of view. Even if an important station wanted to clear for a show, without option time it becomes exposed to extreme pressures from local and spot clients. Option time is a convenient counterargument for station managers under these pressures. Without it, the local or spot advertiser can threaten (and possibly carry out the threat) to move over to the competition. "The station manager," said a network executive, "can easily tell himself that to put in, say, a syndicated show, during one half hour in the week cannot make much of a difference. And he can tell himself that he's done it before. Only now what will happen is that this thing will snowball. Once he's opened the gates, he can't very well refuse others. And once he's done it, {Please turn to page 67) BARROW REPORT INCLUDES LONG LIST OF CURBS ON NETWORKS Limitation on station ownership The Barrow recommendations, regarding tightening of multiple ownership rules is regarded by network as endangering income which they need to support the "extras" in network operation, such as public service and cultural shows. The recommendation is that licensees be forbidden to own more than three vhf stations in the top 25 markets. However, the over-all limit of five vhf and two uhf outlets would be retained. The recommendation is reminiscent of the proposal to limit multiple owners to no more than three stations in total as made three years ago by Harry Plotkin, special (Democratic) counsel of the Senate Commerce Committee. Ending of must-buy lineups The must-buy practice, according to Barrow, may violate antitrust laws. The Network Study Staff recommends that a minimum dollar purchase be substituted. The latter method is now being used by ABC but not by the other two webs. The Barrow group takes the same stand in this area as Rep. Emanuel Celler (D— N.Y.) head of the House Antitrust Subcommittee and Kenneth Cox, who was special counsel of the Senate Commerce Committee. Ous'ing of networks from rep business The networks should be given a reasonable time, "say two years," said the Barrow group, to divest themselves of their spot sales organizations. This was recommended in the Plotkin memo also. Though non-network reps are generally against the Barrow proposals, most are in favor of this recommendation. Placing networks directly under FCC rule Barrow urged the FCC to recommend that Congress specifically authorize it to apply pertinent rules and regulations directly to networks but suggested that the official views of the Department of Justice be requested first. In his address to tv affiliates earlier this month, Richard Salant, CBS, Inc.. vice president, said the company had no objection to application of the existing network regulations directly to the networks rather than indirectly through stations but expressed the fear that the Barrowrecommendations envisaged far more regulation than now done. Control over rate-making New rules were urged to take away from the networks their alleged power to control spot rates ( through pressuring stations to bring their spot rates up the network rate level) and to use network rate increases as a lever to gain additional clearances. Other proposals Other Barrow proposals include full publicity for affiliation contracts, forcing webs to place program where clients want. including overshadowed markets, non-affiliates in certain cases SPONSOR • 25 JANUARY 1958