Variety (May 1941)

68 MUSIC Wednesday, May 7, 1941 Blanket Plan for MBS—Choices to Affiliates 1. The Network Terms 'J'his is the verbatim text of the proposed agreement (sub- ject to ratification by a ma- jority of the afliliates) where- by the Mutual network will resume licensing the catalogs of ASCAP publishers: Blanket License Proposal ASCAP will Isaue a lk...ee granting to the Mutunl Broadcostlng Syatem the use ot all muelc In lU repertoire end at any of Ita BMoclated or affiliated Mclellea. . 1. The consideration lor th6 llcenue to the Mutual Broadcasting Syatem shall be: A. SUSTAINING FEE (a) As to stations arnilated with Mutual having a single station license from ASCAP under which the said stations guarantee to pay to ASCAP an agreed upon amount fixed In dollars tor the uae ot ASCAP music In sustaining prOBriinis. ASCAP will grant to Mutual a license to liroadrast sustalnlni; programs to surh stations upon the payment to It of the sum ot one dollar annually. tb) In the event ot a situation nrlHlng In which any ot the Mutual stations dues not have a single station license from AaCAP, or It such license li a per pro- gram license and the station has not guaranteed to pay to ASCAP an agreed uiMn amount fixed In dolleni for the use ot ASCAP jnusic In sustaining programs, then Mutual ma/ supply Ita susliilning 'programs to such stations upon the. pay- ment to ASCAP ot a sum eqiial to 1^ ot the applicable card rate ot each such atflllated station receiving and rcbrond- rastlng tlie said sustaining progrsm for (he time consumed, provided, however, that In no case shall the maximum ■mount payable by Mutual In respect ot any such station for sustaining programs exceed either: (a) a monthly payment equal to one-half of the highest one-hour published card rate of the station, but In no event more than three-quarters of the monlhlv sustaining tee paid by (he station during the yesr 1P40. or (b) the dirterence between twice the amount slated In subdivision (a) hereof and the actual sum paid during such month by tlie station for sustaining foes: whichever ot such amounts shall ue less. B. COMMERCIAL FEE Mutual furlhor. for the llrst four y<>ar» ot the agreement, shall pay to ASCAP a sum ot 3%, and for the remaining lerin of the agreement a sum ot S'A'i ot lis 'net receipts after deductions' (as here- inafter deflned) received during each year (or the use of the broadcasting farllUlea ot the stations over which the sponsored programs are broadcast. The term 'net receipts' from sponsors shall be construed to mean the gross an\ount paid by sponsor during sue* year tor all network broadcasting facilities, less rate card discounts (quantity and/or frequency) and- any advertising agency commission not to exceed 1S% actually allowed and paid to any recognized adver- tising agencies. The term 'net receipts after reductions •hall be construed to mean the net re- celpta from sponsora during such year, leas (he sum ot the following deduc- tions: (a) An amount equal to the actual cost to' Mutual, Its membere and affiliates, ot all program transmission lines used during such yeac In the transmission of network programs from any member or affiliate station to any other member or affiliate stations^ but shall not Include any program transmission lines extend- ing from a member or acnilate station to the point ot origination ot a remote con- trol program. Neither shall 11 Include the cost- ot any program transmission lines maintained by a regional network affiliate of Mutuol other than the program tranit- mlsslon line connecting the key station ot auc^ regional network with any other member or affiliate (other than an atnil- «te ot such regional network) of Mutual. (b) A sales commission on the net re- ceipts from sponsors tor such year equal to tfie sum of the following: Fifteen per cent (llS?i) on the first one million dollars ($1,000,000) or less ot such net receipts; Twelve and one-half per cent (Iz'.i'^i) on the next two million dollars. ($2,000.- 000) or less of such net receipts (1.000,- 000 to $3,000,000); . Ten per cent (10%) of the next three million doUara ($3,000,000. or leas of such net receipts ($3,000,000 to $0,000,000); Seven and "one-half per cent (714%) of the next tour million dollars ($-1,000,000) or less ot such net receipts ($0,000,000 to $10,000,000); Five per cent (5%) ot the next live million dollars ($5,000,000) or less ot auch net receipts ($10,000,000. to $19,000,000); Two and one-helt per cent (2>.i%) of the next Ave million dollars ($.'i.000.00l)) or less of such net receipts ($13,000,000 to $20,000,000); and One per cent (1%) of all net recelptn In excess of twenty million dollars ($20,000,000). 2. No payment shall be required to be made hereunder with reapoct to any net- work commercial program presented by transcription In the event that payment at the source has been made with rcupci'l to such transcription program. 3. ASCAP will reserve ttie right to re- strict. In good faith, the broadcasting of compositions from musical comedies, operas, operettas, and motion pictures, or any other composition being excessively broadcast, only for the purpose of prevent- ing harmful effect upon sucti productions or compositions In respect of other Interests under the copyrights thereof. In any case, however, ASCAP agrees that the maximum number ot compositions which may -be at any time thus restricted shaU not exceed 000 and moreover limited licenses will be granted upon application entirely tree of additional charge, aa to restricted composi- tions If and when copyright ownera thereof are 'unable to show reasonable hazards to their major Intereata likely to .reault from (ucb broadcaatlnga. Provided, Jiowever, that In no case shall any charges 'free plug' or other considera- tion be required In respect of any permis- sion granted to perform a restricted compo- ■Itlon and further that In no event sfall ■It/ eoropoaltlon, after the Jnltlll broad- cast thereof be restricted tor the purpose ot confining further broadcasts thereof to « particular artist, station, network or program. ' i. ASCAP will agree to maintain during the term of the agreement substantially the existing <}omestlc .repertoire, an<). agrees to. fndcmnlty, save end hold Mutual,, It; member and atflllute atatlona, sponsors, ad- Yertl^^g'agencies and.each of them.harm- less, and defend them and each of. them from and against any claim, demand or ;m>^^Ui»t ,my b<^bi9usiit>.iuiaiiiBt.4hiiin. or. • ,■«■>; I'. -■ »;•■"> oartJ; A-Mrj-J^ti '■ any of them with respect to renditions given during the term hereof or any re- newal In accordance with this license of muak-al compositions contained In ASCAF's repertory heretofore or hereafter during Die term hereof copyrighted or composed by members of ASCAP. 6. Tlie term ot this agreement shall be tor a period ending on December 3.1, IMU. 6. Royally accountings, accompanied by payment In full ahall be rendered to ASCAP on or before the twentieth of each month, covering the previous calendar month, in view of the fact that under Article 1, Sub- division B, sub-eubdivlslons a and b, prci- vlsloiui are made for deductions on an anr nual basis. It Is agreed that these. Items will be estimated monthly In order that a monthly accounting and payment may be made with a final readjustment to be made within thirty days after the end of each tlscHl year. Accountings and payments !4i;ill be made on a bjlling basis,. with a right of deduction for bad accounts and discounts allowed or rebates paid. The pe- riods for less than a full fiscal year at the beginning and end ot thla agreement shall be pro rated. -. A.SCAl' agrees to release and discharge Mutual,, lis member and affiliate stations, advertising agencies, and sponsors from any and all liability and claims whatsovere which may have heretotora arisen as a re- sult of any network broadcast over the Mututal network from and after Janupry 1, lU-11, ot uliy comp4isltlon or work copy- righted or composed by ASCAP members or as to wMrh ASCAP shall have public performing righta, A. .Mutual shall not be required to nn- rount for any sums received froiii political broadcasts. 2. Single Station Terms Supplemental to the signa- turing of a blanket license be- tween Mutual, as a network, and ASCAP, as a music per- formance society," ASCAP agrees to offer single stations affiliated with Mutual a choice of two methods of local license (a) a blanket method or (b) a per program method. The ver- batim text covering both is as follows: Blanket Single Station License ASCAP win Issue a Itcenae Krnnllng lo any stuUnn of the Mutual Broadcnsttns Syntem tho use ot all music In Its repcr- lolro or of nny of Its associated or arniiated societies for local broadcnstlns only. J. The consideration for the llcenae will be: A. SUSTAINING FEB A vpnrly sustaining fee of twelve times the hlBhest one-hour published rate of the station, provided such sum shall not exrepd one-and-one-half times the aus- tnlnlnf; fee paid by the station during the yeur 1040, unless the gross amount paid to stntlon for ttie use of Its broadcast- ing facilities for local broadcasts for \H40 or any year thereafter shall be Icsa than $50,000. In which case ttie buh- tatnlng fee shall be $12. for the succeed- ing year. B. COMMERCIAL FEE Tn addition, the station, for the first four years of the agreement, shall pay to ASCAP R sum of 3%, and for the re- maining term of the agreement a sum or of Its net receipts from sponsors for the use of the broadcasting facilities for local broadcasting. The term 'net receipts' from sponsors shall be construed to lAoan the gross amount paid by sponsor for all local broadcasting facilities, less rate card dis- counts (quantity and/or frequency) and any advertising agency commission not to exceed 1G% actually allowed and paid to a recognized advertising agency. 2. No payment ^all be required to be made hereunder with respect to any local commerclol program presented by transcrip- tion In the event that payment nt the source hnH been made with respect to such tran^tcrlptlon program. 3. ASCAP win reserve the right to re- strict. In good faith, the broadcasting of compositions from musical comedies, operas, operettas, and motion pictures, or any other composition being excessively broa^.cast, only for tho purpose of prevent- ing harmful eftcct upon such prductlons or compositions In respect of other Interests under the copyright thereof. In any caue, however, ASCAP agrees that the maximum number of compositions 'Whlch may be at any time thus restricted shall not exceed .'HK) and moreover limited llcenaoa will be granted upon application entirely free of oddltlonal charge, as to restricted compo- .*iltlon9 If and when copyright owners thereof nre unable to show reasonable ha9:ards to their major Interests likely to roHUlt from such broadcastings. Provided, however, that In no case Miall any charges 'free plug" or other consldera- lion be required In respect of any pcrnils slon granted to porform a restricted com- position, and further provided that In no event shall any composition, after the Initial broadcast thereof, be restricted for the purpose of confining further broadcasts thereof to a particular artlat, station, net- work or program. 4. ASCAP will agree to maintain during the term of the agreement Bubstantlally the existing domestic repertoire, and agrees to Indemnify, save and hold station, spon- sors, advertising agencies, and each of them, harmless, and defend tliem and each of them from and against any claim, Re- mand or BUlt thot may be brought against them or any of thorn with respect to rendi- tions given during the term hereof or any renewal, In accordance with tbls license, of musical compositions contained In ASCAP'8 repertory heretofore or hereafter during'the term hereof copyrighted or com- poned by members ot ASCAP. 0. The term of tbls agreement shall be for a period ending on December 31, 1O40. 0. ASCAP agrees that if a more favor- able'license Is granted to any other cora- parablo broadcasting station, station shall havo the right to avail Itself of the terms thereof. ASCAI^ agrees that any station may, upon requeat. Inspect' at the offices of ASCAP, thb original copy of any llcenae agreement In effect with any broad casting station. 7. Royalty accountings, accompanied by paymbnt ' In full,' shall • be rendered to ASCAP oji or before the twentieth of each month covering ttie previous calendar month. 8. ASCAP agrees to release and dis- charge . station, advertlBlng ogencles and sponBora froni any and all liability and <jlaJtt}s -, t}■^a^Aooyer tftMch. iqa7 iMtve here- tofore arisen as a reHUlt of the broadcast by station from and after Jan. 1, 11)11, of any- composition or work copyrlKhied or <!ompi)scd by ASOAP mcmlMTs or as lo whl'-h ASCAP bIihU have public piTformlDg rights. 0. Station shall not ba required to ac- count for any sums received from political- broadcasts. Per Program Single Station License 1. For the purposes of thla proposal, un- der n4ilch licenses to publicly perform by broadrasting the ASCAP repertoire will be upon r(Hiueflt of nny broadcaster Isnued, the dirrercnt lypea of ntdlo programs are classl- ned variously na follows: A .SUSTAINING, NON-MVSICAL Being a non-commercial, unsponsored local program, containing no music. R. SUSTAINING. MUSICAL Being a non-commerclnl. unsponaorod lm*al program, and which shall Include or present In whole or any part, any mu.tlcnl composition or work. C. COMMERCIAT*. NON-MUSICAL Being a commercial, sponsored local progmm during the presentation of which no musical composition or work what- ever, in whole or Kny part, Is rendered. U.ls to be understood that ns to sports events (excluding football games), pa- THdcft anil civic celebrations, where music nhnll be performed under exclunlve con- trol or direction of others than -tlie li- censee and shall be merely Incidental to the main event or celebration, such pro- grams shall' neverthelens be regarded as coming under this heading. 1). COMMKBCIAL. .MUSICAL Being a commercial, sponsored local program, for the public presentation of which the broadcasting facilities of li- censee have, for a consideration, been engaged by the sponsor; and which ahall include or present In w«iole or any part, any riiusicnl composition or work; or the commercial sponsored broadcast of a football game Incident to which music Is used; and so-called 'participating pro- grams' using music. K. BELIOIOUS. EDUCATIONAL AND CIVIC Being a non-commercial local program, aponaorcd by a religious, educational, pa- triotic, political or civic association or group, and presented under Its offlclal auspices, for which licensee grants the free use of broadcasting facilities. '2. ASCAP will make available to any radio broadcastlng-atatlon a license to pub- licly perform tho composltloi^s copyrighted by Us members, and by the members of nfflllalcd foreign societies upon a 'per pro- gram basis* ■ on the following terms and conditions: In respect of the various typtis of pro- grams the following paymonts shall bo made: SUSTAINING. NON-MUSICAL No payment. COMMERCIAL MUSICAL If any or all of the musical content shall Include, In whole or any part, any ASCAP compoaltlon, an amount equal to ten per cent (10?«) of the net receipts of the licensee from tbe commercial spon- sor for the use of tho broadcasting facili- ties of the station, provided, however, that If the music used shall be limited solely to a single Identical theme or sig- nature and/or to a single Identical theme or signature and Incidental bridge or background mualc in connection with a program otherwise non-musical, thd rate of payment ehaU be 8%: and If only In- cidental bridge or background musical ac- companiment and/or any opening and/or closing muelc (not constituting a theme or signature song) In used In connection with a program otherwise non-musical, the rate ehal Ibe 1<^%. Provided further thdt if the commercial broadcost Is of a football game, a'sum equal.lo lVt% of the amount charged by licensee to the commercial sponsor shall be paid. SUSTAINING. MUSICAL If any or all of the musical content shall Include, In whole or any part,, any ASCAP composition^, an amount cqu^l to ono per cent (1%) of the regular pub- lished full card rate of the station ap- pllcablo for the broadcasting facilities used. In no case eholl the maximum amount payable by licensee In respect of sustaining programs during any year exceed either twelve times ilie highest one-hour published rate of the atatlon or one and one-half Ihncs the sustain- ing fee paid hy the licensee during the yar 1910, whichever shall be less: and provided further that If such maximum amount Is guaranteed then no payments based upon the above percentage need be made. COMMERCIAL NON-MUSICAL No payment. RELIGIOUS.' EDUCATIONAL AND CIVIC No payment. 3. Accountings. A. Licensee Is to furnish, postage pre- paid, to ASCAP monthly a copy of Hie complete station log for each day. In the form required by FCC rules and regula- tions. Part 3. Sec. 8.00, and as to each program thereupon listed as musical or having any musical content, shall furnish ASCAP a complete Item-by-item list of each musical ■ composition rendered in whole or In part during local programs. Such listing shall show, aa to each musi- cal composition thus rendered, the full title thereof, tho name of the composer and/or autbor, and name of the copyright owner as imprinted on the published sheet music or orchestration. Titles may not be abbreviated, but must be shown in full. These requirements apply to all uuch programs, without exception, and regardless of the origin of the program. B. Such report of -each accountable local program shall, if commercially spon- sored, stato the name of the sponsor or sponsors, and the amount charged each sponsor. C. Royolty accountings, accompanied hy payment In full shall be rendered to ASOAP on or before ttie twentieth of each month, covering the previous calen- dar month. Such statements shall show In -respect of each 'accountable program (a) the date of rendition, (b) tho title of the program, (c) the time rendered, (d) the name of each sponsor 'and amount charged to each, and (e) the listing of titles, composers, authors and copyright owners. D. All accountings In respect of local 'commercial musical programs' rendered In accordance wllti the foregoing, shall be understood to relate to the net receipts ■ of the station, construed to mean the gross amount paid by the sponsor for oil broadcasting facilities of tho station, leas into card discounts (quantity and/or frc- , qucncy) and advertising agency comnnls- slon of not exceeding fifteen per cent (15%) If actually paid or allowed to o rccognlsted advertising agency. E. Where renditions are by moans of phonograph records, program listings shall show the manufacturer's brand and serial number of the record. 4. Any failure to comply with the require- pionta s^t out In Article 3 of, %\\l8 proposal TrammeH-Barron Sequel Baltimore, May 6, Niles Trammell, NBC prez, and Hope H. Barroll, Jr., executive v.p. of WFBR, local NBC-Red affiliate which is due to go Mutual Oct. 1, exchanged some more telegrams last week. In the initial bit ot tele- graphic repartee Barroll, reacting to a circular wire from Trammell advising ot the latest move in NBC's negotiations with ASCAP, re- marked, that it looked as if Trammell 'must have a lot of fun walking in and out of meetings with ASCAP trying to get special deals,' Tram- mel answered in part to this crack: 'Just to make your record com- plete I suggest vou pass this message on to Weber and Variety.' The Baltimorean responded to this taunt in the following communi- cation; 'In reply to your wire of April 30 in which you . . advised me to pass this message on to Weber and Variety in order to keep the record complete I would just like to say that you and your NBC cohorts . . . have taught me all I know about such activities during the past three years and it I have become a niaster in this form of procedure I want to offer you my personal .congratulations for making me efficient in same. After all you are the one best qualified to judge . . .' Weber Hits Miller's Tactics ; Contlnned from page STs costs. Let us remind you that during the years when the mem- bers and the affiliates of Mutual were paying their share, years when' the other networks, as a result of their bargaining power, made a deal whereby they were exempt from any payment on the 'twilight zone' and as a conse- quence Mutual and its affiliates were compelled to pay a dispro- portionately higher share of ASCAP's total fees than did the other networks. Let us further remind you that the deal jnade by the other networks exempting . the 't\yilight zone' from license fees was- put over without the ' consent or approval of a single affiliate or independent station. Contrast this, if you please, with our present procedure in which we told you in unqualified lan- as to tho complete Identification ot com- posltlonH performed on programs, shall create the presumption that ttie mualc and/or compogltlons used were ASCAI* compositions, 8. No payment shall be required to be made hereunder with respect to any local commercial program presented by transcrip- tions In the event that payment «t the source has been made with respect to such transcription programs. 0. ASCAP reserves the right to restrict. In good faith, the broadcasting ot composi- tions from musical comedies, operas, operet- tas and motion pictures, or any other com- position being excessively broadcast, only for the purpose ot preventing harmful efTect upon such productions or composi- tions In respect ot otiier Interests under the copyrights thereof. In any case, however, ASCAP agrees that the maximum number ot compositions which may bo at .any time thus renrlcted shall not exceed SOO and moreover limited licenses will be granted upon application, entirely free ot additional charge, as to restricted compositions It and when copyright owners thereof are unable lo show reasonable hazards to their major interests likely to result from auch broad- castings. Provided, however, that In no case sliall any charge, 'free plug,' or other considera- tion be required In re.sr>ect ot any per- mission granted to pertorrh a restricted composition; and further provided that In no event shall any composition, after the Initial broadcast thereof, bo restricted tor the purpose ot confining tho further broad- casts thereof to a particular artlat. net- work station or program, 7. ASCAP agrees to maintain during the term ot the agreement substantially the existing domestic repertoire, and agrees to Indemnify, save and hold licensee, spon- sors, advertising agencies artd each of them, liurmleas, and defend them and each pt thorn from and against nny claim, de- mand or suit that may l>e brought against them or any ot them with respect to rendi- tions given. In accordance with this li- cense, of musical compositions contained In ASCAP's repertory heretofore or here- after copyrighted or composed by members of ASCAP. -6. The term ot ihb agreement may at election of licensee bo fixed to cover any portion of the lime between effective dote and December 31. ifMO, and, notwithstand- ing anything herein to t(ie contrary. It dur- ing any year ot tlie license period the total paymenta per annum made by llcenaee to ASCAP shall be less than 2% ot the total 'net receipts' of the station tor broadcast- ing facilities, as the term 'net receipts' Is :d£nned in the blanket license proposal (or single stations simultaneously submitted by ASCAP. ASCAP may .require licensee to change to the blanket licensing basis for remainder ot the term, and licensee will agree to. accept such blanket basis, or if. auch paymenta shall exceed C7. of such 'net receipts' licensee may require ASCAP to change the formula to such basis tor remainder of the license period nnd ASCAP will agree to accept such' blanket basis; auch option to bo exercised within sixty days following the end of tho applicable license year In which such total 'net re- colpta' shall be leas than or shall exceed the applicable percentage, the new basis to be effective as ot tho beginning ot tho license year within which such option was exercised. 9. ASCAP agrees that ft a more favorable license la granted to nny other comparable broadcasting atatlQh. ttie licensee shall have the right to avail itself ot the terms there- of, ASCAP agrees that any licensee may upon request, Inspect at the ofAcea ot ASCAP the original copy ot any license agreement In effect with any broadcasting iincsee.. 10. ASCAP agrees to release and dis- charge licensee, advertising agencies and sponsors from any and all liability and claims whatsoever which may liave hereto- fore aolson as .a result ot the broadcast from and after January 1, IMl. by licensee ot any composition or work copyrighted or composed' by ASCAP members or-as to which ASCAP shall bave public perform- ing rights. guage that in accordance with strictly democratic procedure. The communications which you have received from other sources than our own radio com- mittee contained many inaccu- racies. We urge you to digest the proposals. The inaccuracies of these communications will then be immediately evident to you. We, therefore, ask that you ignore the statements of anyone who for private reasons which are not compatible with the in- terests ot the Mutual network or' its independent affiliates are seeking to prevent you from reaching your own independent judgment in the matter.' Shepard-Tatt's Communique Following is the 'minority' com- munication sent by John Shepard III and Hulbert Taft, Jr., of WKRC, Cin- cinnati, to Mutual affiliates: 'Mutual sent you today infor- mation regarding contracts not yet drawn which ASCAP ■ has ' promised to sign with Mutual and individual stations. Mutual asked for quick reply which would commit stations without allowing time for analysis of proposal and without waiting for NAB con- vention being helH wltKIn ten days. Present proposal should be compared with offer ASCAP made to you in March, 1940, and which you turned down. In most cases present offer through Mu- tual affords you no saving. On - basis best figures procurable ASCAP would collect under pro- posed deal close to amount paid in 1940. We believe it would be suicide to put ASCAP music back on air as Mutual commit- tee suggests before individual station contracts are signed. Alternative per program deal contains guarantees and we be- lieve does not comply wit)i con- sent decree. We trust you will not be stampeded and will wire Mutual you are withholding your decision until after convention.' In answer to MBS stations wiring they would prefer to wait until the NAB convention before committing themselves to an ASCAP contract, Weber telegraphed Monday (5): "This is not an industry matter. Sole consideration is whether proposals are for best interests of Mutual and affiliates. Mutual's contract must be negotiated in- dependently of other stations or networks, and in good faith to avoid charges of conspiracy with other elements of the industry in violation of anti-trust laws. Ac- cordingly we are prohibited from considering ASCAP proposals on the floor of convention. Urgently request that you study committee report and proposals and then advise us ot your final conclu- sion favorable or unfavorable . with respect to plan.' In Washington Chairman James L. Fly, of . the Federal Communications Commission, on hearing of the ASCAP-MBS contract accord, is- sued this statement: 'I feel.ot course that there is a strong public interest in making available to the public at an early date the vast libraries of ASCAP. I should be regretful if there should arise any impediment to the expeditious consideration of this problem by any and all of the broadcasters. I certainly .think the movement is iii the public interetst and I am happy to hear that the en- tire industry is niaking progress in negotiations which are now under