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to the individual case, that the control of other radio facilities would make a renewal of the license not in the public interest. In the instant case our rules governing multiple ownership are not being violated and we do not believe the last made point has been established by the record. The stations owned or controlled by the Hearst interests serve three widely separated communities. Each of these communities has several stations assigned to it. The dangers which might arise from concentration of control in a single community, or in contiguous areas, with limited choice of radio services, are not here present. Accordingly, the fact that greater diversification might result from a preference of the application of Public Service Radio Corp. is not considered to be a determining factor in this case.
*Similarly, the fact that Hearst interests control one of the two newspapers in Baltimore and a number of newspapers and periodicals in other cities, and that stockholders in the Public Service Radio Corp. have no proprietary interests in Baltimore area newspapers is not considered determinative under the circumstances in this case. Newspaper ownership does not automatically disqualify an applicant. It is a factor which is considered, but only in relation with the other aspects of comparative determination and as it bears upon the final decision of whether a grant to the applicant in question is in the public interest. The record does not show that the common control of WBAL and the Baltimore newspaper has been employed adversely to the interests of the listening public, and an inference can reasonably be drawn that these conditions which have previously obtained will contitnue” (6 Pike & Fischer RR 994, 1031-1032). (Italic supplied.)
While no one concerned with assuring equal rights for newspaper publishers questioned the use of the “diversity” principle as enunciated by the majornty of the Commission in the Hearst case, it was noted that the then Chairman of the Commission and another member of the Commission, constituting 2 of the 5 members who had participated in that decision, had issued strong dissents in which they expressed the opinion that the diversity dogma was practically overriding. The Chairman stated that:
"* * * The Commission is committed to the principle that unless there are overriding considerations, preference should be given to a nonnewspaper, nonmultiple owner applicant as against an applicant which publishes a newspaper or has other broadcast stations in order to encourage the greater diversification of control of the media of mass information. This principle, unlike that of integration and local ownership, is not grounded on the fact that there is any basis for assuming that one applicant is more likely to carry out its program proposals than the other, but is a reflection of the congressional policy expressed in the Communications Act, and that the public interest is best served by having as wide an ownership as possible of the media of mass communications “(6 Pike & Fischer R. R. 994, 1036a). [Italics added.]
Faced with this threat against multiple ownership of news-disseminating agencies and alarmed by what it believed to be a distortion of legislative policy, Congress in 1952 again took up the question of amending the Communications Act to provide an explicit antidiscrimination clause. The Committee on Interstate and Foreign Commerce of the House of Representatives proposed a so-called newspaper amendment to S. 658 to read as follows:
"The Commission shall not make or promulgate any rule or regulation, of substance or procedure, the purpose or result of which is to effect a discrimination between persons based upon interest in, association with, or ownership of any medium primarily engaged in the gathering and dissemination of information and no application for a construction permit or station license, or for the renewal, modification, or transfer of such a permit or license, shall be denied by the Commission solely because of any such interest, association, or ownership.”
This antidiscrimination clause was discussed at length on the floor of the House of Representatives. Comments on the need for the clause reflected extreme concern lest the Commission follow the example of its then chairman and penalizing newspaper owners. Representative comments of Members of Congress are set forth in appendix B, infra. However, the provision was deleted from the amendments to the Communications Act because, as explained in the House conference report," it was considered “unnecessary.”
"* * * It is the view of the conference committee that under the present law the Commission is not authorized to make or promulgate any rule or regulation the effect of which would be to discriminate against any person because
5 H. Rept. No. 2426, 82d Cong., 2d sess. (1952), pp. 18-19.
such person has an interest in, or association with, a newspaper or other medium for gathering and disseminating information. Also the Commission could not arbitrarily deny any application solely because of any such interest or association.” (Italics added.)
It appears that by its deeds, albeit not by its words, the Commission has refuted these views of the conference committee. In the last 3 years the Commission had departed from its announced policy of merely considering newspaper ownership as one of the comparative factors to be taken into account only when all other qualifications are equal. A study of Commission decisions, as distinguished from their rationale, indicates that the Commission has fully embraced the views expressed by the then chairman of the Commission in his decision in the Hearst case, supra, that in the absence of overriding considerations, preference should be given to the applicant who will bring to the community an adequate media of communication having no connection directly or indirectly with the ownership of other communication media in that community.
It has become increasingly clear on the basis of decided cases that there are seldom such things as "overriding considerations” in favor of newspaper. Although a number of newspaper-connected applications have been filed for television facilities and tremendous sums of money have been expended by the applicants in the prosecution of their applications with the hope of being treated on a par with other applicants, they have had “two strikes" against them. Their newspaper ownership or affiliation has in effect constituted an almost irrebuttable presumption of comparative disqualification.
To repeat, in all but 2 of the 12 contested cases coming before them for comparative consideration, since the television “freeze" was lifted in April of 1952, in which newspapers or persons associated with newspapers were pitted against applicants with no such connections, the Commission has invoked, and placed major emphasis upon, its “diversification of media" policy—or has managed by dint of grasping at minutiae to find some other weakness in the newspaper applicant's position which made it comparatively inferior-in order to render a decision against it. The “diversification of media” issue is not to be confused with monopoly, for in none of these cases would there have been any monopolization of the media of mass communication if the newspaper applicant had been favored. Although, as noted above, the Commission has attempted usually to bolster its decision against the newspaper by finding some additional point of preference for its opponent, it is fair to state that the diversification issue is deemed paramount by most members of the Commission,' and no newspaper puhlisher can win a comparative hearing before the Commission unless its superiority in all other criteria of comparison is so overwhelming as to overcome this disability.8
In the Oregon Television case, supra, the newspaper-connected applicant was again conceded by the Commission to have "an outstanding record of performance" in its operation of a radio station for many years. On the other hand, the winning applicant was admittedly subject to very substantial detriments. Nevertheless, the latter was preferred because of the diversification issue.
6 Oregon Television, Inc. (Portland, Oreg.), 9 Pike & Fischer R. R. 1401 (July 27, 1954); affirmed, Columbia Empire Telecasters, Inc. v. F. C. C., U. S. App. D. C. Dec. 15, 1955 ; The Enterprise Company (Beaumont, Tex.), 9 Pike & Fischer R. R. 816 (Aug. 6, 1954); reversed and remanded (for purposes of determining effect of agreements entered into between the losing newspaper-connected applicant and the grantee following the Commission's decision), Enterprise Company v. 7. C. C., U. S._App. D. C. Dec. 29, 1955 : Tampa Times Co. (Tampa, Fla.), 10 Pike & Fischer R. R. 77 (Sept. 3, 1954); Radio Fort Wayne, Inc. (Fort Wayne, Ind.), 9 Pike & Fischer R. R. 1221, 1222p; (Oct. 1, 1954, and Dec. 9, 1955): McClatchy Broadcasting Co. (Sacramento, Calif.), 9 Pike & Fischer R. R. 190 (Oct. 4, 1954) : affirmed McClatchy Broadcasting Co. v. F. C. C.,
U. S. App. D. C. Jan. 27, 1956; KTBS, Inc. (Shreveport, La.), 10 Pike & Fischer R. R. 811 (Feb. 18, 1955); WKRG-TV, Inc. (Mobile, Ala.), 10 Pike & Fischer R. R. 225 (Mar. 25, 1955): The Radio Station KFHCo. (Wichita, Kans.), 11 Pike & Fischer R. R. 1 (June 9, 1955): Richmond Newspapers, Inc. (Richmond, Va.), 11 Pike & Fischer R. R. 1235 (Nov. 30, 1955); Scripps-Howard Radio, Inc. (Knoxville, Tenn.), 11 Pike & Fischer R. R. 985 (Jan. 13, 1956); cf. Radio Wisconsin, Inc. (Madison, Wis.), 10 Pike & Fischer R. R. 1224 (Dec. 7, 1955), involving a contest between 2 newspaperconnected applicants, in which the 1 with the more distant connections prevailed over the applicant with local newspaper connections. The two exceptions are: The Tribune Co. (Tampa, Fla.), 9 Pike & Fischer R. R. 719 (Aug. 6, 1954), in which the closest losing competitor was also a newspaper-connected applicant, affirmed, Pinellas Broadcasting Co. v. F. C. C., U. S. App. D. C. Jan. 19, 1956; and the recent case of Biscayne Television Corporation (Miami, Fla.), 11 Pike & Fischer R. R. 1113 (Jan. 20, 1956).
7 The Commission has claimed that support for its emphasis on “diversification" may be found in Scripps-Howard Radio, Inc. v. F. C. C., 189 F. 2d 677 cert. denied, 342 U. S. 830.
8 Broadcasting-Telecasting magazine, November 1, 1954, p. 86: Diversification : Its Case History, F. C. C. Denies Discrimination, But Newspapers Still Lose Out.
In Fort Wayne, Ind., with two contested channels sought by newspaperconnected applicants, neither was successful. One newspaper dropped out after a strongly worded unfavorable examiner's initial decision, Northeastern Indiana Broadcasters, Inc. (9 Pike & Fischer R. R. 261 (1953)). The other newspaper applicant, unsuccessful before the Commission, Radio Fort Wayne, Inc. (9 Pike & Fischer R. R. 1221 (1954)), secured a reversal and remand from the United States Court of Appeals (Fleming v. F. C. C., U. S. App. D. C. 225 F. 2d 523, June 13, 1955), but upon consideration of the remand the Commission again preferred the applicant that was not connected with a newspaper (Radio Fort Wayne, Inc., 9 Pike & Fischer R. R. 1222p (Dec. 9, 1955)). The only manner in which it has been possible for newspaper-connected applicants to obtain grants for television facilities has been via uncontested proceedingsat least by the time the matter reached the full Commission--and then not without opposition.”
The dissenting opinion in the Wichita, Kans., case in which KFH, a newspaper-connected applicant, was denied a television license, will serve to illustrate the kind of insurmountable barrier placed in the way of a newspaper owner in competing for a television license:
“The attempt to belittle or diminish that outstanding record * * * amounts really to placing emphasis on small and trivial matters and cannot stand careful scrutiny. The fact is that the record is one of the most excellent and outstanding ones compiled by any licensee of this Commission. KFH received award after award from Billboard, Variety, Freedom Foundation and others for the excellence of its programs and for the high standard of its public service operation. Against this superior and outstanding record, we weight no record at all from Wichita Television. The decision to be reached was which one of these applicants knows more about the community's needs, which applicant is most likely to be responsive to the community's needs and which applicant can be relied upon to a greater extent to carry out its television commitments. We had KFH's splendid record before us—we had nothing from Wichita Television but promises.
“As to diversification, I do not think that in the case of awarding a license to a local newspaper, which is not a monopoly, that diversification should outweigh all other factors in the case. The applicant, KFH, is partially owned by the Wichita Eagle which has negative control of the radio station, owning one-half of the capital stock of KFH at this time. The Eagle publishes 1 of the 2 newspapers in Wichita and has done so since 1872. It was established by Victor Murdock and is published today by his son, Marcellus Murdock. If a TV permit were granted KFH, the Eagle would hold only some 38 percent of the stock and the examiner furthermore pointed out that the operations of KFH and the Wichita Eagle are separate and distinct. In this case, the service rendered by the newspaper and the radio station would seem to merit consideration instead of being regarded as a factor to be held against them. Newspaper ownership should be only one of the numerous comparative factors to be weighed in reaching a decision” (Radio Station KFH Co., 11 Pike & Fischer R. R. 1, 116a-116b).
Language in the very recent Biscayne Television case, supra, in which the applicant connected with the Miami New's and the Miami Herald prevailed is difficult to reconcile with the language in such cases as McClatchy, Oregon Television, and Radio Station KFH, supra. It appears that considerations not encompassed in the record, were brought to bear in reaching a decision favorable to the newspaper-connected applicant.
In short, except for the two instances under circumstances described hereinabove, the Commission has not adhered to the view that “Both Congress, the courts, and this Commission are in agreement that a permit should not be withheld from an applicant because otherwise engaged in the dissemination of news; the diversification factor is simply one more factor to be considered in the comparative process.” (See e. g., Tampa Times Co., supra.) As a matter of actual practice, however, it has used its policy of diversification as an overriding factor wherever possible so as to defeat the applicant owned by or associated with a newspaper. It has thereby so magnified the diversification principle as to obscure the basic statutory requirement that a grant that best serves the public convenience, interest, and necessity should be made.
9 E. g., Southern Newspapers, Inc. (Hot Springs, Ark.), 10 Pike & Fischer R. R. 59 (1954) : Ohio Valley Broadcasting Corp. (Clarksburg, W. Va.), 10 Pike & Fischer R. R. 191 (1954); Birney Imes, Jr. (Columbus, Miss.), 10 Pike & Fischer R. R. 1192 (1954) : see also Cowles Broadcasting Co. (Des Moines, Iowa), 10 Pike & Fischer R. R. 1289 (1954), and Southern Tier Radio Service, Inc. (Binghamton-Endicott, N. Y.), 11 Pike & Fischer R. R. 143 (1954), where after initial decision by examiner the opposing applicants merged for an uncontested grant.
The preference which has been shown nonnewspaper applicants over newspaper applicants flowing from the excesses of the Commission's diversification policy is in conflict with the decision of the Supreme Court of the United States in Federal Communications Commission v. Sanders Brothers Radio Station (309 U. S. 470), in which it stated that * * * “the act recognizes that the field of broadcasting is one of free competition” and, "An important element of public interest and convenience affecting the issue of a license is the ability of the licensee to render the best practicable service to the community reached by his broadcasts."
Many of the losing newspapers have attempted to secure redress by appeal to the courts. However, with the limited review of administrative action which is available to a reviewing court, and absent procedural defects in the Commission's decision, small are the chances of a defeated newspaper being able to get a court to reverse the Commission in these cases—turning as they do on administrative discretion. Such review does not enable the court to cut through the ostensible reasons for unfavorable Commission action and to reach the core of the problemto wit, the overwhelming burden which the Commission has placed on any applicant connected with a newspaper. As recently as January 27, 1956, in McClatchy Broadcasting Company v. Federal Communications Commission, supra, the court of appeals gave the Commission carte blanche authority to do just as it pleased with respect to the diversification of media criterion. In that case the examiner had found McClatchy superior in all areas of comparison save one diversification of media--and recommended an award to McClatchy. The Commission reversed the examiner and awarded the grant to the non-newspaperconnected opponent of McClatchy. The court affirmed the Commission.
"We hold that the Commission is entitled to consider diversification of control in connection with all other relevant facts and to attach such significance to it as its judgment dictates." (Italic supplied.)
The court's opinion concluded vith his significant statement :
“Although the examiner's choice of McClatchy as superior in all respects except diversification of control is strongly supported by the proof, we cannot find that the Commission's decision was arbitrary, capricious, or unsupported by substantial evidence." (Italic supplied.)
The needed relief cannot be expected from the courts.
A recent decision of the court of appeals has aggravated the difficulties faced by newspaper owners in applying for broadcast facilities. Prior to this decision, the Commission's practice of imposing a handicap on newspaper owners, bad as it was, had been confined to comparative hearings involving a choice by the Commission between a newspaper-connected applicant and one without newspaper affiliations. On June 9, 1955), however, the court of appeals in Clarksburg Publishing Co. v. Federal Communications Commission ( - U. S. App. D. C. 225 F. 2d 511), held in effect that even though a newspaper-connected company is the only applicant for a particular television channel in a community (its competitior having withdrawn), and even though it publishes no newspaper in that praticular community, the Commission may be required, under the provisions of section 309 (c) of the Communications Act, to hold a full hearing to determine whether or not a grant to it would constitute such a concentration of control of the media of mass communication as to be contrary to the public interest. Thus, even if there is no other applicant who wishes to avail itself of the opportunity to render a service on the channel sought by a newspaper-connected applicant, and even though the Commission in the absence of competitive applicants has made a determination without a hearing that a grant to the newspaper applicant is in the public interest, the Commission now has judicially sanctioned power, on the protest of one who alleges he will be faced with competition from the sought-after facility, to let the channel lie fallow rather than permit the newspaper-connected applicant to proceed with its use.
A strong dissent was voiced when the court of appeals affirmed by a 2 to 1 vote the Commission's preference for a newspaper-connected applicant over a second newspaper applicant and a third applicant with no such affiliation, in Pinellas Broadcasting Co. v. Federal Communications Commission (- U. S. App. D. C. Jan. 19, 1956). The dissenting judge stated that:
6* * * a final disposition of this review, should await a remand to the Commission for the purpose of supplying an essential conclusion which is missing from the present record. This conclusion relates to the issue of concentration of control and diversification of the media of mass communication.
"It is true that Pinellas [also a newspaper-connected applicant] did not challenge, either administratively or before this court, the Commission's failure to reach a conclusion on this issue. Under familiar principles, and a review provision of the act, it may be argued that our consideration of this issue is precluded. But I think this argument cannot prevail when, as here, it would result in abandonment of our duty to require the Commission to discharge its proper function with respect to '[o]ne of the basic underlying considerations' of the act.
"It clearly appears from the scheme of the act that the Commission may not disregard issues of vital importance to the public interest simply because they are not presented by the parties.”
Thus, we see that in the only comparative case to reach the court of appeals in which the Commission after long hearings conceded that the public interest would best be served by the newspaper applicant and awarded the grant to such applicant, at least one member of the court felt so strongly about the Commission's media diversification policy that he would have remanded despite the fact that the issue was not before him. It is time that the courts, as well as the Commission, have a clear expression of Congress in the matter of discrimination against newspapers.
The time is past when Congress can rely upon the representations made by the Federal Communications Commission that antidiscrimination legislation is unnecessary. It is now abundantly clear that if the newspaper owners are to have the same standing before the Commission as other business interests, it is imperative that Congress make known its views in this matter by appropriate legislation at the earliest possible moment. At least a dozen applications for television facilities are now pending before the Commission on behalf of newspaper-connected applicants and such applications will continue to be filed. If remedial legislation is deferred, the abuses against newspaper publishers will continue. It is urged that Congress express itself in unequivocal terms that newspaper publishers are not "second class" citizens. This can be accomplished by enacting H. R. 6968 of the 84th Congress.
The report accompanying S. 1973 (S. Rept. No. 741, 81st Cong., 1st sess., p. 2), contained the following explanation as to why an antidiscrimination clause was dropped from the bill:
“The committee desires to call particular attention to one amendmentnamely, section 14which was contained in the measure as first introduced and has now been eliminated. This section read as follows:
“ 'No sanction shall be imposed or substantive rule or order be issued except within jurisdiction delegated to the Commission and as authorized by law. The Commission shall make or promulgate no rule or regulation of substance or procedure, the purpose or result of which is to effect a discrimination between persons based upon race, religious, or political affiliation, or kind of lawful occupation or business association.'
“The committee deems it important to point out why this section was dropped from the bill. This language was first proposed nearly 6 years ago during hearings on a Communications Act amendments bill, solely because the Federal Communications Commission at that time had under consideration a rule which would prohibit newspapers from becoming holders of raido licenses. While the Commission may have been motivated, in part at least, by the best intentions in seeking to prevent monopolistic control of organs of public expression in a community, its threatened action was of questionable constitutional validity, particularly in the absence of specific authority in the basic act to adopt such a rule. However, the net effect of the Commission's proposed antinewspaper rule was to deny consideration of applications from newspapers, all such applications having been placed in a pending file. After reflection for some 2 years, the Commission dropped all plans for such a rule and began processing of newspaper applications in the same manner as other applications.
"In testimony on the bill (S. 1973) before this committee, the Commission spokesman pointed out that present Commission practice and procedure has been in accord with that which had been intended by the original language, some
10 The quoted language is that of the Commission.