Television digest with electronic reports (Jan-Dec 1954)

4 STOREB SELLS TO SAN ANTONIO PUBLISHER: Newspapers and newspaper-broadcasters continue to be a dominant category of TV station ownership — and this week's $5,500,000 purchase by owners of San Antonio Express and News of George B. Storer's KGBS-TV (Ch. 5), with radio KGBS (50-kw day, 10-kw night on 680 kc, CBS), further points up fact that publishing interests are determined to maintain the same identity with TV that they have gained over the years in radio. At beginning of this year, 105 TV stations were wholly or partly owned by newspaper interests, 7 more by magazine publishers (see pp. 39-41, TV Factbook No. 18). Since then, 5 more newspaper-identified TVs have been added, all new starters (see p. 6), besides which Time Inc. has made deal to buy KLZ-TV & KLZ, Denver (see p. 14). That means, as of now, nearly 50% of the 582 TV stations currently on air have newspaper ownership — about same proportion as prevails in radio. San Antonio publisher Frank G. Huntress must sell his KSTA (5-kw on 550 kc, ABC), which he bought from Gene Howe group in 1949 for |300,000. But with KGBS he recaptures CBS radio affiliation which Storer took away, gets basic CBS-TV besides. On Storer's part, though he announced that the deal was intended to pave way for his 310,000.000 purchase of Empire Coil Co. (Vol.l0:2), he still has obstacles to overcome for FCC has made it plain it won't rule on ownership of 2 extra uhf by 5-limit vhf owners until after Senate's uhf probe of May 4 (postponed from April 27). Storer bought KGBS-TV (then KEYL) for $1,050,000, plus assiimption of DuMont note for $200,000, in 1951 (Vol. 7 ;30, 51) . He has spent more than $1,000,000 on its plant improvement. Then, last year, he bought KGBS (then KABC) for $700,000 (Vol. 9:26,34). His son George Jr., lately reassigned to Miami headquarters, was gen. mgr. Combined TV-radio reputedly show monthly operating profit of well over $50,000. Another newspaper getting into TV via purchase is Peoria Journal-Star, about to take over WTVH-TV (Ch. 19). on air only since last Aug., for $225,000 — of which about half is said to be assumption of obligations. * * * * Note : Recent sale of Col. Robert McCormick's Washington Times-Herald to Eugene Meyer's Washington Post (WTOP-TV & WTOP, WMBR-TV & WMBR) was really forced by bad times the Chicago Tribune publisher faced with his Washington venture. It recalls how late Louis G. Caldwell, counsel for the McCormick-Patterson interests, had urged Mrs. Cissie Patterson, then Times-Herald publisher, to apply for TV while channels were available. She wouldn't, and the channel she might have had went to R.H. Macy interests (then owning WOR) . They sold WOIC (now WTOP-TV) to Meyer (55%) and CBS (45^) for $1,400,000 in 1950. The TV-radio properties, as FCC records reveal, have been the bulwark of Washington Post Co.'s income ever since — even overcoming the newspaper's operating deficits. TV would inevitably have been a main asset of the Patterson estate. By same token, Portland Oregonian, which in 1948 turned in a prefreeze CP, and itself was later sold to Newhouse for $1,000,000, would have been worth several times that sum had it ventured into TV, SUPREME COURT REVERSAL OF GIVEAWAY BAN: FCC stuck its neck out a little too far — back in 1949 — when it coined a new definition of "lottery", and got slapped down this week by highest court in the land because it "overstepped the bounds of interpretation [and] exceeded its rule making power." Gist of 8-0 decision of U.S. Supreme Court (Justice Douglas not participating) was that Commission erred in classifying as lotteries those programs, such as "Stop the Music," on which prizes are awarded to viewers or listeners reached by telephone at their homes. The court pointed out that this definition had never been accepted by any court or any other Federal agency and "there cannot be one construction for the FCC and another for the Dept, of Justice." Chief Justice Warren, delivering decision, pointed out that a lottery must involve distribution of prizes according to chance, for a consideration — and he rejected FCC's contention that mere viewing or listening to a program constituted a "substantial consideration" paid to the broadcasting station. Decision actually set no important precedent — other than to put Commission on its guard against too broad an interpretation of Criminal Code — according to