Variety (June 1956)

42 RADIO-TELEVISION tSfitelETX Wednesday, June 13, 1956 Stanton Hits at Bricker, Moore ; Continued from pa&e 26 ; mary facts. There is in general a noticeable absence of supporting data. On the relatively few occa¬ sions when the statement did deal with facts, they were often wrong. And when the statement's facts were technically correct, the infer¬ ences which were drawn from them and the multiple assumptions which were built upon them were equally inaccurate and mislead¬ ing." In the Bricker analysis, CBS took up in turn charges that (1) the networks have failed to live up to the . objectives of the Federal Communications Act; (2) that the networks and “selected affiliates'” have a disproportionate share of revenues and profits; (3) that an ‘“economic monopoly" exists be- </ause of web control over “access to programming”;'(4) that the net¬ works discriminate against the smaller markets overlapped by larger markets; and (5) that CBS' allocation plan suggests “amputa¬ tion at the neck" for stations out¬ side the top 100 markets. ‘Living; Up to Objectives’ To the first charge, the network declared that in all three respects, it has lived up to the objectives of the Communications Act; it has preserved and encouraged compe¬ tition, it has provided “meaning¬ ful service to the country" and has aided in supporting as many local stations as possible. More¬ over, it is asserted that Sen. Brick¬ er fails to relate data on revenue and profits to the charge that the networks have defeated the objec¬ tives of Congress. To the second charge, CBS re¬ plied that revenues per se is a . “meaningless" measure, since net¬ work expenses are high and reve¬ nues consequently must also be high. On the matter of profits, it strongly attacked Sen. Bricker's method of relating profits to “net investment" instead of sales, charging that this is a misleading measurement since a “broadcast¬ er’s investment is not so much in bricks and mortar as it is in a cre¬ ative sales and service organiza¬ tion." The use of this “public utility concept of profit measure¬ ment in the field of broadcasting is like concluding that since a flea can jump over 100 times its own height, the flea is more powerful than the elephant." Moreover, the use of profits as a measure of monopoly is out of or¬ der. “Where, as here, there is no substantial evidence of legally de¬ fined monopoly or intent to mo¬ nopolize, a company's share of in¬ dustry profits finds far simpler and less sinister—and more accurate— explanations than ‘economic monop¬ oly' and ‘economic strangulation.' Industry leadership in the field is a less dramatic but a more inno¬ cent and accurate underlying ex¬ planation." Again, in the answer to the third charge, Sen. Bricker was accused of ignoring “basic television (and other) economics" and “finding sin¬ ister indicia of monopoly." CBS does not determine an affiliate’s “access" to programming; the ad¬ vertiser does. In taking a selective group of 73 stations and an arbit¬ rary figure of 41% or more of the network schedule as carried by the stations, Sen. Bricker “indulges in arbitrary manipulation and exclu¬ sions and inclusions" to attempt to demonstrate that these 73 stations and CBS and NBC had a net in¬ come exceeding the net of all four webs and 410 stations in 1954 and that outside those 73 stations “tele¬ vision is a losing proposition on the whole. Bricker “indulges in arithmetical legerdermain" by sub¬ tracting “only enough of the profitable stations so that the re¬ maining stations can be lumped with those which are not profitable in order to arrive at a total net loss" and also involves “apples and pears since it lumps stations and networks together on both sides of the ledger." In the matter of overlap, CBS averred that networks are helping the smaller markets in overlap situations and submitted letters to that effect from owners of three stations mentioned as victims by Sen. Bricker; it attacked the pro¬ posal to limit signal areas as “im¬ possible of enforcement and incon¬ sistent with the American principle of. free enterprise"; it analyzed the contention that “large stations of¬ ten succeed in locating transmit¬ ters closer to competing cities than to their own" by listing a table of transmitters more than 25 milt# from the city of assignment and in each case showing that the location waS prompted for reasons of terrain, to keep away from a large adjoining market or to move in with coverage of a larger market by a smaller neighboring market. Not one case involved a larger market encroaching on a smaller one. As to the fifth contention, CBS cited jrecent testimony to show that its allocations plan is deeply con¬ cerned with stations outside the top 100 markets, that testimony be¬ fore the same committee by en¬ gineering v.p. William Lodge on March 27. Stanton Vs. Moore In the reply to Moore, CBS con¬ centrated on specific errors of fact, listing option time data to demon¬ strate that affiliates are not re¬ quired to carry an “unreasonably large" proportion of network shows and that network programs outrate syndicated shows by a large mar¬ gin. It denied that CBS has “ever imposed as -a* condition of accept¬ ance of a program, or of making time available for it, a requirement that it be granted a financial inter¬ est" and stated that Moore himself conceded that “he knew of no such specific instance.” Reply cited clearances and spread-of-sale of syndicated pro¬ grams to show that they were not being locked out of the market, and moreover demonstrated that a cross-section of CBS affiliates car¬ ries more syndicated programming than the non-affiliated indie sta¬ tions, with several carrying more than KTTV itself. It denied that it ever used a contract for “Tales of the Texas Rangers" as a lever to force the Tatham-Laird agency to withdraw “Captain Midnight" from KTTV, where it was carried in lieu of KNXT, CBS' o&o in L.A., and produced a letter from George A. Bolas, director of media activities of T-L, to the effect that “we were never threatened or informed in any. way by CBS that we were jeopardizing the possible' time pe¬ riod clearance of ‘Tales of the Texas Rangers’ unless we moved ‘Captain Midnight’ to the CBS net¬ work in Los Angeles.” WCCO Hikes AM Rate Minneapolis, June 12. A Twin Cities' radio station, WCCO, for the first time since tele¬ vision’s deep inroads on audio audiences is boosting its advertis¬ ing rates. When its new rate card is issued on August 1, there’ll be a 5 to 12% boost in the morning rate, accord¬ ing to general. manager Larry Haeg. It’s called for, he says, by the fact that there has been a 5V£% increase in audience and Nielsen rating has jumped from 50.7 to 66 . 1 %. DALY'S REUGIOSO PITCH Rabbinical TV Workshop Hears Plea for TV Curriculum Religioso video should become a regular part of the theological seminary curriculum, urged John Daly, ABC veep. The boss of news, special events and public affairs for the network spoke at the open¬ ing session Monday (11) of the fourth annual Rabbinical* Tele¬ vision Workshop. Video, according to Daly, has had a “profound" influence on politics and education, but religion has not kept steady pace with the developing of the “vital" medium. “There is competition for ... a limited audience in the public af¬ fairs area—individual public af¬ fairs programs vying for the same stratum of viewers," Paly pointed out. “In this situation," he continued, “it is imperative that the re¬ ligious program meet the high standards demanded, first, in order to obtain a place on the program schedule and second, to attract and hold the audience, which is cer¬ tainly more discriminating and de¬ manding than the ' general audi¬ ence." AFN Station In GermanyAxed Frankfurt, June 5. AFN Nurenberg, one of the chain of American Forces Network stations bringing radio entertain¬ ment to U. S. troops stationed in Germany, was cancelled and out of business overnight and without warning last week. AFN Nurenberg did its regular Sunday broadcast, then at its*usual sign-on time Monday morning, AFN Munich came on the air to cover for it. AFN officials, head¬ quartered at Hochst, near here, re¬ fused to give any official explana¬ tion on the removal of the station, except to explain it’s due to “budg¬ etary cuts." Officials said the Nurenberg station has been perma¬ nently shut down, although it has been in continuous operation since January, 1950, and that the AFN Munich station would take its spot on the air. Civilian and military personnel from the station are supposed to be reassigned. Several .weeks ago, civilian per¬ sonnel across the entire AFN net were served with form letters about a possible cut in the net’s civilian manpower, telling in what order employees would lose their jobs. AFN officials said, however, that they do not expect any more cuts and only wanted to forewarn employees should the situation occur. Additional cut rumors say that stations at Bremerhaven and Stutt¬ gart will be the next to go, and possibly also some AFN-produced shows will be eliminated. TV Networks at Crossroads Continued from page 1 ; bility of the antitrust laws and ex- tensive„ replies to the testimony and proposals of Sen. John W. Bricker and indie station operator Dick Moore, all of which are cov¬ ered separately. (See Radio-TV section). The Columbia prez, backed by this imposing mountain of statis¬ tics, argument and background material, sought to impress the committee with three main gen¬ eral points: Cautious on Ignorance 1. That “networking” is an ex¬ traordinary complex and inter¬ related thing of which no part “can be exmained in isolation from the others." It is “an or¬ ganic thing,” and because of this interrelation of its parts, “neglect or ignorance of basic facts can lead to wholly wrong conclusions, and wrong conclusions can lead to dis¬ aster. Judgment, to be success¬ ful here, iflust be highly informed judgment, based on adequate and accurate knowledge.” 2. That the, proposals must be considered from the point of view of the “broadest interests"—the 'national American public," and not from “special interests" who have appeared before the commit¬ tee. “The proposals for change must first, last and always be sub¬ jected to this fundamental test: not how will the change affect particu¬ lar stations or groups of program suppliers or scenic designers, but how will It affect the public? Will the change improve or degrade what the public is getting? Are you sure that the change will add to the public's fare or may the change involve the grave risk, in¬ stead, of taking away from the public that which It has demon¬ strated it wants?” 3. That the charge that the ‘heads of networks exercise an ar¬ bitrary and capricious power over what the public sees and does not see on television" is completely untrue. “I suppose that it could also be said that the heads of the major motion picture companies dictate the kind of movies that people will see; that the heads of the largest television receiver manufacturers dictate the kind of television sets that people will use; and that the heads of the several big soup companies dictate the kind of soup that people will eat. ' ‘Responsibility Ours’ ‘All these statements have a surface truth. But they are wrong. In each case, the manufac¬ turer, naturally, has the final re¬ sponsibility of deciding what his company will produce, just as we have the final responsibility for deciding what our program sched¬ ule will include. But in the case of all these industries, the decision is based on the company’s best in¬ formation of the needs and wants of the consuming public—in our case, to. satisfy the tastes of the Profile Of A TV Network . . . ♦ ♦ ♦ Washington, June 12. Frank Stanton’s 224-page “memorandum” on “Network Prac¬ tices” for the benefit of the Senate Committee on Interstate & Foreign Commerce (see separate story) con¬ stitutes a “profile of a network.” Apart from making his points vis- a-vis charges of monopoly, Stanton laid down facts & figures about network personnel, costs and oper¬ ations rarely seen outside the net¬ work accounts’ domain. Item: It costs CBS-TV $700,000 a week to run the network opera¬ tion, exclusive of program costs. This involves payment to 2,412 fulltime employees but extends to a total of 5,493 persons, including the fulltimers, per diem employ¬ ees, talent and supporting corpor¬ ate personnel attached to the pa¬ rent company or other divisions. In contrast, CBS-TV in 1949 em¬ ployed 427 personnel. Item: Personnel breakdown shows a program department com¬ prising 38 supervisory and 91 addi¬ tional employees, apart from cre¬ ative personnel specifically as¬ signed to individual shows; a 22- man research department spend¬ ing $300,000 annually; sales staff of 48 salesmen and 23 sales serv¬ ice personnel; 42-man engineering staff, 12-man station relations de- partment, 37 in promotion, and 2,400 in operations. News and pub¬ lic affairs, with an annual budget of $7,000,000, maintains four do¬ mestic bureaus, five in Europe and one in the Far East, employs 600 contract and freelance newsmen in 263 locations, and maintains a Washington bureau of 11 corre¬ spondents, three executives, six pubaffairs men and a 13-man film unit. Public Affairs Dept, em¬ ploys 103, spends $2,000,000 a year in programming and costs $500,000 annually to run. (“Out of Dark¬ ness," one of the pubaffairs “spe¬ cials,” involved out-of-pocket costs of $135,000 plus $40,000 in “Omni¬ bus" preemptions, while “The Search" series cost $750,000, of which two-thirds was spent during more than three years of prepara¬ tion.) CBS-TV’s 29 Studios Item: CBS-TV. maintains 29 studios, 22 of them in New York, five in Hollywood* and two in Chi¬ cago, with the N. Y.-L. A. facilities alone involving an investment of $28,000,000. Web spent more than $3,000,000 for its Gotham color studio, $1,000,000 on its Coast tint facilities, with another $1,000,000 already appropriated for more Coast color and the web currently considering an investment of “up to $25,000,000 in additional plant facilities over the next few years.” The facilities cost $6,500,000 to maintain in 1955, and equipment includes 148 live cameras, 35 film cameras, 6,200 lighting fixtures, 896 monitors, 972 microphones, 1,- 043 video amplifiers, 41 master, studio and telecine controls and 68 film projectors. $13,500,000 Cable Bill Item: Web transmitted 2,561 hours of programming last year, compared to the 427-hour total mo¬ tion picture output in the U. S. Breakdown showed 1,508 hours produced by CBS-TV, 1,053 pro¬ duced by outside sources in asso¬ ciation with the web. The network ran up an AT&T cable bill of $13,- 500,000 during 1955. It also spent $1,000,000 on the development of programs that never saw the light of day. The network lost a total of $7,100,000 (without allocation of overhead such as selling or admin¬ istrative expense) on its commer¬ cial programs alone, involving loss¬ es in network production on the programs. It also spent $10,500,000 on sustaining entertainment and pubaffairs programs. It’s also es¬ timated that there were $4,500,000 spent in overhead expense directly attributable to program production, thus bringing the total costs of sus¬ taining and commercial programs to $22,000,000 in 1955. public and to expose it to the wid¬ est variety of information, enter¬ tainment and art so that, if it chooses, the public may develop new and different tastes. “In fact, in the business of broadcasting perhaps more than in any other business, the ultimate decision is not ours but the pub¬ lic’s. In our business the process is one of pure democracy. Each viewer is completely free to turn his dial on or off or to "shop around. He has made no investment in the program. He need never buy. He is as free, an agent as there can be. “I would say that in these cir¬ cumstances it is absolutely impos¬ sible for networks or their officers to affront public taste, to deny public taste, to control public taste, to run persistently counter to public taste, or to manipulate public taste to their own ends. For television, the public is the ulti¬ mate monitor — the monitor-in¬ chief. What it persistently turns off, cannot be turned on again by any group of network executives, let me assure you.” Stanton concluded with the re¬ quest that the burden of proof^be laid at. the feet of those making the proposals for change. “I think I have said enough to make it evi¬ dent that the problems of network¬ ing are at once delicate and com¬ plex, and contain elements of tre¬ mendous scope and importance. There is nothing sinister in the management and operation of net¬ works. There is nothing capricious in our practices and procedures. Believe me, we have learned about them the hard way—through ex¬ perience and much experiment. Speaking for the Columbia Broad¬ casting System I can certainly say that we want to stay continually on the frontiers of improvement, wherever they lie. But in the light of public approval and the success that we have met with up to now, it would be rash and dan¬ gerous, and frivolous as well, to act on mistaken or uninformed be¬ liefs, or on the selective submis¬ sions of a few special interest groups. The burden of . proof that something better, instead of only something different, will in fact be achieved in networking inevitably rests on him who makes the pro¬ posal." Hubbard ■■ Continued from pafre 28 to the whereabouts of its con¬ cealed $105,000 bank draft which will go to anybody able to find it within the present 10-day period. WDGY listens in itself ort WCCO and immediately has its announcer inform its own listeners, “That’s all you need to know in case you’re called by another station.” On its part, WCCO is ignoring WDGY's gimmick in the matter of its keys’ phrasing. “As far as we’re concerned, we’re the only ones doing anything,” says Clayt Kaufman, WCCO promotion manager. “We won’t try to retal¬ iate by rebroadcasting the clues to the $105,000 money hunt sponsored by WDGY.’’ “Cashorama” actually is a bigger version of WCCO’s principal regu¬ lar cash giveaway deal initiated 11 weeks ago when the local audio money warfare started. It the 11 weeks WCCO would have forked and able to repeat key words or phrases and, later, identify mystery sounds. As it was, the total amount handed out was $22,000, which, across a total of $177,000 if every person called had been listening however, is believed to be consid¬ erably more than any other single Twin Cities’ station has paid. It’s pointed out that if the previous clip . continues the present 10-day “$250,- 000 Cashorama” may cost it about $32,000. However, the $250,000. is on deposit in two Twin Cities’ banks. Also, after the present pro¬ motion the previous numerous cash giveaways will continue, according to Kaufman. WDGY's $105,000 jackpot prize has been underwritten by an in¬ surance company. It’ll be paid only in case a person within the current 10-day period is able to find a bank draft hidden within 10 miles of the station which provides clues throughout the day as to its where¬ abouts. Odds against its being found are estimated at 47 to one. After the deadline the prize only will be worth $500.