Variety radio directory (1937)

FEDERAL RADIO REGULATION— Continued licensee and stipulate that no license shall be construed to create any right beyond the terms, conditions and period of the license. It is said that when the price is substantially larger than the value of the physical assets, then there is an attempted sale of the "channel," a "trafficking in wave-lengths;" that since the license is only for a brief period and there is no assurance of renewal, there is no justification for capitalization on earnings such as would be perfectly proper in fixing the value of any other business ; and that no allowance can be made for "good will" or "going value" since both are directly dependent on use of the channel and future renewals of license. This is not the proper place to debate the question as to the correct interpretation of the law. In any event, the matter has received considerable attention from members of Congress during the current session. At present there is no ascertainable principle or standard to guide those who wish to sell or to buy stations. The reader will readily appreciate the unfortunate effects of the uncertainty, with its bearing on estate and inheritance taxes and on the value of stock in corporations which hold licenses, in a business so important to its owners and to the public as is broadcasting. VII. THE COMMISSION'S PRACTICE AND PROCEDURE— APPLICATIONS AND HEARINGS As is already apparent, what we have called the judicial powers of the Commission are exercised almost entirely (so far as broadcasting stations are concerned) in connection with its decisions granting or denying various sorts of applications. These applications fall within five principal classes: (1) application for a construction permit; (2) 'application for a license; (3) application for renewal of license; (4) application for modification of license, and (5) application for the Commission's consent to an assignment of license or permit, or to the transfer of control of a corporation holding a license or permit. There are various sorts of special, experimental and temporary authorizations, authorizations connected with services which are auxiliary to broadcasting (for testing and for relay or pick-up purposes), applications involving permits to transmit programs across international boundaries, and others which need not occupy our attention separately. The first step toward obtaining a license to operate a broadcast station (or, with certain exceptions, any other kind of radio station) is to apply to the Commission for a construction permit which, in effect, is a preliminary license covering construction of the proposed station. The application is made on a printed form furnished by the Commission, setting forth such facts as the Commission prescribes as to the citizenship, character, and the financial, technical, and other ability of the applicant to construct and operate the proposed station, together with considerable detail regarding the nature, purpose and technical equipment of the station. It must be sworn to. This application is first routed through the Secretary's office, the Engineering Department and the Law Department of the Commission. If the application is defective on its face, or is obviously in conflict with the requirements of the Act, or of the Commission's regulations, the normal practice is to return it without further ado, although there have been frequent departures from this practice. The application is then reported back to the proper division of the Commission, in this case the Broadcast Division, for initial action. Under the Act, if the Broadcast Division finds that "public interest, convenience or necessity" will be served by granting the application, then the application may be 295