TWELFTH ANNUAL REPORT FEDERAL COMMUNICATIONS COMMISSION FISCAL YEAR ENDED JUNE 30, 1946 (With Notation orSubsequent Important Developments) UNITED STATES GOVERNMENT PRINTING OFFICE. WASHINGTON. 1947 For sale by the Superintendent of Documents, U. S. Government Printing Office Washington 25, D. C. Price 20 cents COMMISSIONERS MEMBERS OF THE FEDERAL COMMUNICATIONS COMMISSION (As of January 1, 1947) CHAIRMAN CHARLES R. DENNY (Term expires June 80,1951) PAUL A. WALKER (Term expires June 30, 1953) RAY C. W AJ{EFIELD (Term expires June 30, 1947) CLTF,FORD J. DURR (Term eXPires June 30, 1948) II E,WEf.,J.. K. JETT (Term expires June 30, 1950) ROSEL H. HYDE (Term expires June 30, 1952) (Vacancy) LETTER OF TRANSMITTAL FEDERAL COMMUNICATIONS COMM;.ISSION, W08hington 25, D.O., Feb. 8, 1947. 1'0 the Cong1'e"8 of the United State,,: Th, Twelfth Annual Report of the Federal Communications Com. mission is submitted herewith in compliance with section 4 (k) of the Communications Act. While this report primarily covers the fiscal year ended June 30 last, certain subsequent developments are nu:mtioned in the introduc tory summary so that the Congress may be more currently informed. The return of peace has aroused an unprecedented interest in elec· trical communications that has taxed the limited funds and personnel of the Commission. The showing made has largely been made pos sible by extraordinary ingenuity and effort on the part of employees in all levels. Respectfully, CHARLES R. DENNY, 0 ha:il'man. III [ Page IV in the original document is intentionally blank ] TABLE OF CONTENTS INTRODUCTORY SUMMARy - -------~---------....--.--------- Ohapter I. GENERAL . ----- 1. Administration - - - - - - - - - --- - --- - - - - - - - - - - - --- - - _.. -- 2. Commission membership - ----- - - __ --. - - - _- - __ 3. Staff organization ._ 4. PersonneL '.. - -. -.- _ 5. Appropriations ._- - - - - - - - - _.- - - - - - - - - - - --- - - - - - - - - -- 6. I.egislation. - - - - - - - - - - - - - - - - - - - - - - - - - .0__ 7. Litigation. • -. - -- - - -- ---------------------- - -- 8. Public service responsibility of broadcast licensees. _ 9. Monopoly__ . - .. - - ---~--------- - -- ----------- -- --- 10. Frequency service-aUocations _ 11. InternationaL - ----- - __ -_- -_ - __ - - - - --_ 12. Interdepartment Radio Advisory Committee _ 13. Field a.ctlvities - - _- - - - - _- - - - _- - - - __ - _ Reconversion from war to peace _ Ranio Intelligence Division .. _ Field Division .. _ 14. Board of WarCommunications~_ II. STANDARD BROADCAST - - - - - - - - - - - - - - - -- -.- - - - - - -- - -- - - -- 1. Postwar expansioll _ 2. ApplicatioIlS .,. .,. _ 3. Clear channelhealing~'-~. _ 4. Changes in standard bloadcast policy _ 5. InternationaL~_- - - - - - - - - -_ - - - - - --- _- _ 6. Financial data~.. _ 7. Statistics - _- _- - - __ - _- - _ III. NONSTANDARD BROADCAST - - - _ 1. Frequency modulation (FM) broadcast service _ 2. Television broadcast selvicc . _ 3. International broadcast service~_ 4. Noncommercial educat.ional broadcast service _ 5. Facsimile broadcast selvice _ 6. R.emote piCKUp broadcast service _ 7. ST (studio-transmitter) broadcast service _ 8. Developmental broadcast sNvice _ 9. Statistics~~__ :._ IV. COMMON CARRIERS~__~• 1. Telephone (wire and radio) _ Service and facilities _ Domestic radiotelephone services a _ International radiotelephone circuits _ Rates and tariffs _ Supervision of accounts _ Economics and statistics~_ 2. Telegraph (wire, cable, radio)~_ Service and facilities .:. _ Hates and tariffs _ Supervision of accounts . _ Statistics ' _ Internat.ionaL':' _ International conferences '- _ Service and facilit.ies .~_ Ocean cables _ Rates and tariffs _ Supervision of accounts . _ Statistics -; _ v p ... vi! 1 1 1 2 2 2 2 2 4 4 5 6 7 7 7 7 7 7 9 9 9 10 il 11 12 13 15 15 17 18 18 19 19 19 20 20 21 21 21 22 23 23 24 25 26 26 28 28 29 29 29 30 30 31 31 32 VI TABLE OF CONTENTS Chapter V. SAFETY AND SPECIAL SERVICES _ 1. Marine scrvices _ General _ New radio devices .. _ Equipment trends and developments . _ Equipment type approvaL _ Frequency assignrnents _ Ship stations . _ Distress .. _ Exemptions _ \Vaivers _ Rule change .. _ Coastal stations~~_ Marine relay stations~_ Alaskan point-to-point and coast.al stat.ions _ Mobile press stations_ _____ _________ _~__~_ 2.Avia~~~:~df;~~;v~~e~=~~~~-~~========================== New telecommunication aids _ International aviat,ion service__ _~_ Domestic aviation service _ AiIcraft radio stations _ Aeronautical radio statiollR~_ Aeronautical fixed radio stations ________ _ _ Airport control radio stations~__ Radio marker statiolls~_ Flying school rac.io stMions .. _ Flight-test radio st.ations .. _ 3. Emergency radio service_______________ _ _ Police radio stations __ ._~_ Municipal fire radio stations .. __ ForeRtry radio statioIls~~~r_ Special emergency radio stations~_ 4. Railroad radioservice~~.. _ 5. Experimental radio services _ General~_ Wartime developments~~_ R.adar ..~_ Microwave relay_______________ _~~ General mobile service____ _ " _ Rural radiotelephone service _ Citizens' radiocommunication service., _ Industrial radio service .. _ Low-power provisional radto stations__~_ 6. State guard radio statiolls~.. 7. Miscellaneous radio services _ Geological radio stations _ Provisional radio stations~_ Relay pless Parlio stations "" _ Motion-picture radio stations_~. __~~_ 8. Statistics~_ VI. RADIO OPERATORS~_ 1. Commercial operators _ 2. Amateur radio service~_ 3. Examinations ,- . _ VII. TECHNICAL STUDIES_ _ _ _ _ _ _ _ _ _ _ _~_ 1. Technical Information Division~~_ Sunspot and noise measurements _ Low-frequencyrecording~_ Very-high frequency recording _ Tropospheric effects _ Mobile surveys _ Sporadic E.-layer reflections ";~_ BUIst phenomena~_ 2. Laboratory Division_________ _ _ ApPENDIX(publil~alionsL.:. .._~. ._ .. _ Page 35 35 35 35 36 36 36 36 37 37, 37 38 38 38 38 38 38 39 39 39 40 41 41 41 42 42 42 42 43 43 44 44 44 45 45 45 46 46 47 47 48 49 49 49 49 50 50 50 50 50 51 53 53 55 56 57 57 57 57 58 58 58 58 59 59 61 INTRODUCTORY SUMMARY HIGHLIGHTS OF FISCAL YEAR ENDED JUNE 30, 1946 Assisting in the reconversion and eXJ?ansion of the Nation's elec trical communications engaged the major attention of the Federal Communications Commission during the fiscal year ending June 30, 1946. Construction for civilian purposes having been virtually halted dur ing the war, applications to build facilities in the existing systems or in new systems reached an all-time high. Expansion in the broadcast services as shown at the fiscal year's end: Standard: 961 existing stations, 254 construction permits issued, 659 applications pending; frequency modulation (FM): 55 existing stations, 456 construction permits or conditional 'grants issued, 250 applications pending; television: 6 existing stations; 24 construction permits issued, 40 applications pending. Several hundred of the applications were ill conflict with one or more applications or existing stations and were designated for hearing. Authorizations were granted for the construction of 3,000 miles of telephone cable, 16,500 miles of coaxial cable, and 12,200 miles of open wire. ,",Vestern Union launched an extensive modernization :program. Actual construction of facilities authorized by the CommIssion, as well as related construction such as radio receivers, was seriously han dicapped by shortages of materials. , Many new services were either authorized or actually got under way during the year. Radio to supplement rural wire telephone service and for taxicabs, trucks, private autos, busses and similar vehicles, was authorized on an experimental basis. Several companies were granted authority to experiment with microwave radio relay systems. The Commission began issuing experimental licenses for radar on merchant ships to test its value in promoting the safety of life and navigation at SI/.R. To meet the demands of sharply expanded air traffic, the entire domestic aviation conlffiunication system is being re vised. The railroad radio service, lLfter several years of experimen tation, and after a comprehensive investigation by the Commission, was authorized as a regular service. Most of these new services were made possible by wartime technical developments which permit use of the shorter waves in the radio spectrum. The Nation's 60,000 amateurs, who had been silenced during the war, were permitted to return to the air. . An all-time peak of 8,000 merchant ships were licensed. The num ber of police radio stations, some having as many as 200 transmitters, rose to 2,800. As one step in its effort to provide standard broadcast service to some 21,000,000 Americans who are not now being satisfactorily served, the Commission began a series of hearings to determine what changes if any should be made in the present policies on allocation of clear channels. On March 7, 1946, the Commission issued a report, "Public Service Responsibility of Broadcast Licensees," which dealt with the problem VII mI INTRODUCTORY SUMMARY of improving broadcast service. It announ';"d that thereafter, in is suing and renewing licenses of broadcast stations, the Commission proposed to give particular consideration to four program service fac tors relevant to the public interest. These are: (1) the carrying of sustaining programs, including network sustaining programs with particular reference to the retention by the licensees of a proper discre tion and responsibility for maintaining a balanced program structure; (2) the carrying of local live programs;' (3) the carrying of programs devoted to discussions of public issues; and (4) the elimination of ad vertising excesses. After granting Western Union a I-year rate increase to offset an anticipated loss of about $12,000,000 in 1946, the· Commission con cluded that the company would need substantially more revenue "if it is to continue in operation as a solvent enterprise and provide satisfac tory service ,on a comprehensive Nation-wide basis." HIGHLIGHTS 01)' ACTIVITIES JUNE-aO, 1946, TO JANUARY 1, 1947 A /?ublic utility radio.serv~cewas authorized August 12 for power, tranSIt, and petroleum pIpe-lme compames. As of December 9, reas surance was given that taxicab and truck radio services will be estab lished after further experimentation. Proposed rules and regulations governing diathermy and industrial heating equipment were the subject of a hearing which began December 18 and, on December 26, a frequency was assigued for the immediate use of these devices. A revised {'art 1 of the Commission's Rules and Regulations relating to organizatron, practice, and procedure was published September 4. Beginning August 16 when it outlined procedure in processing broadcast applications, the Commission at intervals published status lists of pendiug AM, FM, and television cases. An order of July 18 withholds until June 30, 1947, assignment of one out of every five Class B, FM channels, and a tentative allocation plan was announced September 3.. On December 9 the United States Supreme Court upheld the right of the Commission to deny renewal of license to WOKO, Albany, N. Y. (mentioned elsewhere in this report). , . Petition of the Columbia Broadcasting System seeking authoriza tion of commercial color television was heard by the Commission en bane throughout the week of December 9, and continued into the new year. An order of December 27 granted WesternU~iona supplem!,ntal rate increase of slightly more~han9 percent. ThIS ,,:as accomplIshed by replacing the 10-percent mcrease of June 12 ,,:'t1.' a, 20-percent increase. Mea,nwhile, on September 25, the CommISSIOnsuspen~ed, until a,dditional funds are obta,inable, its special telegmph investIga,- tion ordered June 4. ' . . On November 27, a hearing was ordered i)l th.e matter of serVIce~nd frequencies used in ra,diotelegmph commumcatlon between the Umted States a,nd foreign points. ., Acting Chairman Charles R. Denny was appomted ChaIrman by the PreSIdent on December 4. . . The period since the close of the last fiscal year saw mtensIvee~ort to reduce paper work and simplify procedures 'Yhe,:"ver pOSSIble. Forms have been shortened and, m some cases, applIcatIOns are repro- INTRODtJcroRY SUMMARY IX duced as part of the license. Also, arrangements were made to issue aviation radio licenses at airports. Other short euts include renewing special temporary authorizations without issuing new documents, accepting single application where the licensee holds several non broadcast licenses, eliminating oath requirements for some reports and fonus, abandoning fingerprints and proof of citizenship for oper ators, relinquishing permit requirements for operators of some classes of mobile transmitters, and authorizing use of mobile transmitters in specified numbers instead of individually. Since the close of the war, more than 200,000 applications covering 40 categories of radio service have been received, and nearly 200,000 authorizations issued. The result is that, at the close of the calendar year 1946; the total number of licensees and permittees was nearing 530,000. During the same period, more than 27,000 pages of tariH filings were received. . CHAPTER I General I. ADMINISTRATION 2. COMMISSION MEMBERSHIP 3. STAFF ORGANIZATION 4. PERSONNEL 5. APPROPRIATIONS 6. LEGISLATION 7. LITIGATION 8. PUBLIC SERVICE RESPONSIBILITY OF BROADCAST LiCENSEES 9. MONOPOLY 10. FREQUENCY SERVICE-ALLOCATIONS II. INTERNATIONAL 12. INTERDEPARTMENT RADIO ADVISORY COMMITTEE 13. FIELD ACTIVITIES 14. BOARD OF WAR COMMUNICATIONS CHAPTERI-~ENERAL I. ADMINISTRATION The Commission continued to function as a unit, directly supervis ing all activities, with delegations of responsibility to committees of Commissioners, individual Commissioners, and the Administrative Board. The Commission itself made all policy determinations. 2. COMMISSION MEMBERSHIP. Paul A. Porter relinquished the chairmanship of the Commission on February 28, 1946, to accept Presidential appointment as Adminis trator of the Office of Price Administration. On the following day the President designated Charles R. Denny as Acting Chairman. Commissioner William H. Wills died on March 6 of that year and, on April 17, Rosel H. Hyde, then General Counsel of the Commission, was sworn in as his successor. On June 15, 1946, the Senate confirmed the renomination of Commissioner Paul A. 'Valker for another 7-year term. 1 2 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION 3. STAFF ORGANIZATION The Commission's operating organization consists of four depart ments-Engineering Department, Accounting Department, Law De partment, 'and Secretary's Department (formerly the Office of the Secretary) angmented by four staff service units--a Rules Committee, a Personnel Division, a Budget aud Planning Division, and an Office of Information. The Administrative Board, consisting of the General Counsel, Chief Engineer, Chief Accountant, and Secretary of the Commission, was scheduled to be deactivated and its powers delegated to the heads of the respective departmcnts slibject to Commission supervision. Reorganization of the Engineering Depal'tment in November December of 1945, created four branches-Broadcast, Safety and Spe cial Services, and Field and Research. Two new divisions were added to the last mentioned. One, the Frequency Service Allocations Divi sion, makes service allocation of radio frequencies. The Chief of this division represents the Commission on the Interdepartment Radio Advisory Committee, and his division is responsible 'for maintaining the IRAC secretariat. The other addition is the Laboratory Division, which investigates civilian uses of new devices, conducts wave propa gation and allocation studies, develops new monitoring equipment, and tests transmitters for type approval. 4. PERSONNEL At the closc of the fiscal year, the Commission personnel totaled 1,345, of whom 853 were in Washington and 492 in the field. The Engineering Department numbered 727 employees, Accounting 163, Law 111, and 344 were engaged in administrative duties. The Foreign Broadcast Intelligence Service, which numbered 219 employees, was discontinued as -a Commission activity on December 30, 1945. -5. APPROPRIATIONS The Commission received appropriations totaling $5,489,900 during the fiscal year. Of this amount, $662,421 was for the Foreign Broad cast Intelligence Service. 6. LEGISLATION The only amendment to the Communications Act during the fiscal year was enactment of the Lea-Petrillo bill (Public No. 344, 79th Cong.) which added a new section (506) to title 5 entitled "Coercive, Practices Affecting Broadcasting." It prohibits anyone from forcing broadcast stations to add unnecessary employees to pay multiple com pensation, to- refrain from broadcasting noncommercial 01' foreign origin programs, and to pay tribute for or interfere with their use of recordings and transcnptions. Penalties are provided. 7. LITIGATION Three cases involving the Commission were before the United States Supreme Court during the fiscal year. In one case the Commission was reversed, and its decision was sustained in another. The third case was still pending. REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION 3 Five cases were before the Court of Appeals for .the District of Columbia. Oue was dismissed on motion of the appellee after the Supreme Court reversed the lower court decision and upheld the Commission, and Commission action was reversed in another. The other three cases were pending.. . Of three cases filed in Federal district courts, judgment for the Commission was rendered in one case and the other two were awaiting decision. Of particular interest were the. following Supreme Court cases: United State8 et til. v. New Yo?,!" Telephone Co.-The Commission appealed from dismissal of its motion for summary judgment and issuance of an injunction setting aside the Commission's order by the st"tutory three-judge court convened pursuant to section 402 of the Cammunications Act. (N&w York Telephone Co. v. United States et til., 56 F. Supp. 932.) The'Supreme Court affirmed the Commission's order of December 14, 1943, which required the New YorkTelephon~ Company to make certain adjustments in its accounts. These adjust ments related to certain transactions nnder which the New York Telephone Co. acquired from the American Telephone & Telegraph Co. properties at a price in excess of original cost less accrued depreCIa tion. The New York Telephone Co. entered in its books the prices charged to it by the present corporation. The Commission disap proved this accounting, holding that in transfers of property between parent and affiliate, the book figures of the former should have been used by the affiliate. The Supreme Court, in rever'sing the lower court decision 1 • npheld this position of the Commission. (United States et til. v. New York Telephone 00. 326 U. S. 638). . Ashbaaker Radio Corp. v. United States.-The Surreme Court reversed an action by the Court of Appeals for the Distl'lct of Colum bia dismissing an appeal by the Ashbacker Radio Corp. under sec tion 402 (b) (2) of the Communications Act because of an alleged lack of jurisdiction. Ashbacker had appealed denial of its petition for hearing, rehearing and other relief directed against the grant without hearing of an application filed by the Fetzer Broadcasting Co. for authority to construct a new standard broadcast station, mutu ally exclusive with an application filed by Ashbacker to change the operating frequency of its existing station. The Commission, after comparative consideration of both applications, had granted the Fetzer application and on the same day.had designated the Ashbacker application for future hearing. The Supreme Court held that under the facts in the case and the applicable provisions of the Communi cations Act the Fetzer application could not properly be granted withont first having afforded Ashbacker an opportunity for hearing upon its pending application. (Ashbaeker Radio Corp. v. United States, 326 U. S. 327.) WOKO, Ina. v. Federal Oorwmunieations Oommission.-This action involved an appeal by the licensee to set aside an order of the Commis sion denying renewal of its broadcast station license. The Commis sion based its decision on the licensee's failure to furnish true infor mation concerning the ownership of 24 percent of the stock jn the licensee corporation and its falsification of information submitted to the Commission concerning the ownership of such stock. The licensee's course of misrepresentation and concealment for a period of 4 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION approximately 18 years evidenced to the Commission a lack of the qualifications required of a licensee to operate a station in the public interest. The Circuit Court of Appeals for the District of Columbia reversed the Commission primarily on the ground that such action, without a consideration of other factors' such as the need for the broadcast service and loss of invested capital which the licensee might incur, was beyond the scope of Commission authority. The Com mission's petition for a writ of certiorari to review the lower court decision was granted by the Supreme Court on April 22, 1946. (WOKO,Ino. v. Federal Oommunications Oommi88ion, 153 F. 2d 623.) 8. PUBLIC SERVICE RESPONSIBILITY OF BROADCAST LICE)/SEES On April 10, 1945, the Commission announced a policy of "a more detailed review of broadcast station performance when passing upon applications for license renewals." At the same time, it instituted a study of the subject which culminated in its unanimous adoption, on March 7, 1946, of a report on "Public Service ResponsibilIty of Broadcast Licensees," in which the Commission observed: Primary responsibility for the American sj'stem of bt'oadcasting rests with the licensee of broadcast stations, including the network organizatiollH. It is to the stations and networks rather than to Federal regUlation thllt listeners must primarily turn for improyed standards of program service. The Commis sion, as the licensing agency established by Congl'ess, has responsibility to con sider over-all program service in its public interest determinations, but nffirma tive improv€'ment of program sel'vice must be the result primarily of other forces, However, the Commission concluded: While mUch of the responsibility for improved program service lies with the broadcasting industrY and with the public, the Commission has a statutory responsibility for the public interest, of which it callnot divest itseH. The Commission's experience with the detniled review of broadcast renewal applica tions since April 1945, together with the facts set forth in this report, indicate some current trends in broadcasting which, with reference to licensing procedure, required its particular attention. Therefore, in issuing and renewing the licenses of broadcast stations of all types, the Commission proposed to give particular eonsidera tion to four program factors: (1) The carrying of sustaining pro grams', including network sustaining programs, with particular reference to the retention by licensees of a proper diseretion and responsibility for maintaining a well-balanced program structure; (2) the carrying of local Iive programs; (3) the carrying of prowams devoted to the discussion of public issues, and (4) the eliminatIOn of advertising excesses. 9. MONOPOLY Following public hearings, the Commission ordered reservation, until June 30,1947, of one out of every five Class B (metropolitan, to the inclusion of rural) FM channels tentatively allocated for various areas throughout the United States. Besides insuring an equitable distribution of FM frequeneies and offering opportunity for late comers to enter the field, this policy is in line with recommendations of the Senate Small Business Committee to preclude monopolistic tendencies in this new type of broadcast. . REPORT OF THE.FEDERAL COMMUNICATIONS COMMISSION 5 The Commission's multiple ownership regulations, which stem larl(ely from the 1940 report on its cham-broadcasting inquiry, re mamed unchanged in their effect on standard, FM and television commercial program service. In general, there is a ban on operation of more than one station in either category by the same interest or l(roup in the same area, except under unusual circumstances. There IS no set maximum for the number· of. standard stations operated by the same interest in the country as a whole. However, because of the competitive factor and other considerations, the Commission has denied a network authority to acquire another station to an already considerable list. The maximum number of FM stations which can 00 operated in the country as a whole by the same individual or con: cern is six, and for television stations, five. In developing FM, the Commission started off with a "one-to-a-customer" policy but, as more applications were received, this was increased to two, then three, particularly when it meant bringing FM to communities not pre viously served. 10. FREQUENCY SERVICE-ALLOCATIONS Before the waI·, the .usable portion of the radio spectrum extended from 10 kilocycles to about 300 mcgacycles. As a result, there was congestion·jn bands assigned to certain services. However, the war's: electronic and other developments not only made higher frequencies potentially useful but al.so evolved apparatus to use them. Conse auently, in 1945 it was considered practicable to extend the radio , ceiling" to 30,000 megacycles (30,000,000 kilocycles). The Commission has since made allocations throughout this aug mented radio spectrum to enable established services to expand and to accommodate new services. For more effective use of the lower part of the spectrum, encouragement was given to transrer of services from medium and highfre~uenciesto the "very high" (30 to 300 megacycles), the "ultra-high' (300 to 3000 megacycles), or "super high (3000 to 30,000 megacycles), with suitable provision for postwar application of radar. Standard (AM) broadcasting, having developed between 550 and 1600 kilocycles, continues in that band, with proposal to add the 540 kilocycle channel if possible. Above 30 megacycles, television broad casting is provided between 44 and 216 megacycles, together with an experimental allocation for this service between 480 and 920 mega cycles; frequency modulation (FM) broadcasting is allocated between 88 and 108 megacycles, while experimental facsimile broadcasting uses 106-108 and 470-480 megacycles, the former being shared with FM'. The other spectrum between 30 and 30,000 megacycles is divided between Government and non-Government services and labeled "fixed and mobile" so as to provide flexibility in effecting future frequency assiguments. . The Commission's proposal of May 21, 1945, for frequency service allocations below 25,000 kilocycles was the subject of oral argument on the following June 22. During the fiscal year the evidence pre sented in this docket case (No. 6651) Was studied and the Commission, in collaboration with the Interdepartment Radio Advisory Com mittee, reviewed particular problems in this portion of the radio spectrum. 6 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION' Implementation of the Commission's report of frequency service allocations above 25,000 kilocycles proceeded as quickly as. possible, consistent with the availability of radio equipment capable of civil use and standardization of devices likely to be used on a world-wide basis, sucl;J. as altimeters, distance indicators and instrument landing equipment for airplanes flying international air routes, radar beacons and other radio aids to air and marine navigation. The nonavail ability of suitable equipment has delayed utilization of some of the bands provided for the non-government services. H. INTERNATIONAL An agreement between the United States and the United Kingdom permits the interim nse of the 200 megacycle British distance indi cator at United States gateways until January 1, 1949. Thereafter, the use of this device will no longer be permitted in this country. The agreement was effected in order to preserve our important frequency allocations which conflict with those required by the British distance indicator. As a further result of this agreement, a program with the objective of developing a I,OOO-megacycle distance mdicator for air_ craft was agreed upon., and several manufacturing concerns are en gaged in producing it. The Commission was. represented at .the Third Intep-American Radio Conference at Rio de Janeiro, Brazil, in September 1945, which drafted a new Inter-AmericanTelecommunications Convention. This sessionstudi~dvarious technical proposals for the next World Tele communicrttions Conference, including United States proposal for revision of the international frequency service-allocation table. Gen eral reaction to it by the participating governments was favorable. Commission representatives served as United States delegates to an International Meeting on Radio Aids to Marine Navigation (IMRAMN) at London during May 1946, convened for studying electronic devises developed for this purpose in the United Kingdom and other countries. This meeting disclosed that most of the marine radio navigational aids which appear likely to be standardized inter nationally are provided for in the Commission's frequency service allocation proposals. The actual choice of particular competitive devices has not been determined finally at the international level, but the United States frequency service-allocation proposals provide for medium frequency loran (long range navigation) as an aid to long distance navigation, a system of radio beacons in the medium fre quency range used in conjunction with shipboard direction finders as a medium distance aid, and shipboard radar with its associated shore beacons for short distance assistance. The shore facilities in the cas.e of all three of these aids are operated by the United States Coast Guard. In preparation for the Wor.ld Telecommunications Conference, the Commission not only arranged to provide delegates to that session, and to the preliminary technical conference, but undertook a compre hensive study of records of frequencies transmitted and received by radio stations in the United States and its possessions. The latter .undertaking is expected to result in a system which will more ade quately meet the requirements imposed upon the Commission by the occupancy of the heretofore little used portion of the spectrum above REPORT OF TllEFIIDERAL COMMUNICATIONS COMMISSION 7 40 ';'egacycles, and to also furnish these conferences appropriate frequency data on United States stations. 12. INTERDEPARTMENT RADIO ADVISORY COMMITTEE The IRAC approved 2,738 new regular frequency assignments and 1,904 deletions of regular assignments, bringing the total number of assignments recommended since its establishment to 43,101. Out standing regular assignments now total 34,674. During the year the Committee approved 302 changes in assignments, 3,629 temporary assignments, and 350 deletions of temporary assignments, which are not inclnded in the above figures. A total of 9,230 applications and requests was processed by the Committee. 13. FIELD ACTIVITIES RECONVERSION FROM WAR TO PEACE As previously reported, a Foreign Broadcast Intelligence Service, created by the Commission for emergency purposes, monitored and analyzed foreign broadcasts for military and other.Government agen cies while the Radio Intelligence Division guarded against enemy transmission in this country and helped furnish bearings to our air craft. The FBIS was absorbed by the IVaI' Department in December of 1945, but the RID continued to monitor the ethel' for illegal trans mission. RADIO INTELLIGENCE DIVISION The Radio Intelligence Division closed the fiscal year with 11 primary monitoring stations and 25 secondary monitoring stations in operation. In maintaining surveillance over the channels of radio communications, it located ;117 illegal radio stations. In addition, it aided both Government and industry in tracing SOurces of interference to radio transmission.Emer~encydirection finding service was ren dered both military and civilIan aircraft, and 137 "fixes" supplied to planes requiring such assistance. Plans were in progress at the end of the fiscal year to merge Radio Intelligence Division and the Field Division into a Field Engineering and Monitoring Division for peacetime functioning. FIELD -DIVISION Strategically located throughopt the United States, including Alaska, Honolulu, and Puerto Rico, the Field Division had 25 district offices, 2 ship offices, 8 primary monitoring stations, 1 field engineering laboratory, and 2 mobile laboratories. Their duties included in spection of radio stations, giving radio operator examinations, making various radio measurements and field-intensity recordings, and con ducting related investigations. 14. BOARD OF WAR COMMUNICATIONS The Board of War Communications (formerly the Defense Com munications Board) coordinated plans for the most efficient operation of the country's radio, wire and cable facilities during the national emergency. The Acting Chairman of the Commission is also Acting Chairman of the Board which is representative of public and private interests in that field. 721617-47-2 8 REPORT OF THE FEDERAL COMMUNICATIONS COJV!MISSION In addition to assisting in the preparation of orders issued by the Board looking toward the removal or adjustment of wartime restric tions, the Commission also cooperated with the Board in resolving particular problems arising from cessation of hostilities. Various complaints relating to telephone and telegraph priorities were in- vestigated.~ CHAPTER II Standard Broadcast 1. POSTWAR EXPANSION 2. APPLICATIONS 3. CLEAR CHANNEL HEARING 4. CHANGES IN BROADCAST POLICY 5. INTERNATIONAL 6. FINANCIAL DATA 7. STATISTICS CHAPTER II-STANDARD BROADCAST 1. POSTWAR EXPANSION The first postwar year found the broadcast industry, in common with other business, faced with innumerable reconversion problems. The increaseddema1~dfor standard broadcast facilities on thepa~tof p.re~entandprospectIve hcensees taxed the ablhty of the CommISSIon's limIted staff. An additional workload was imposed by the necessity for carrying on extensive engineering investigations required in connection with the clear channel hearing. The monumental task of collecting and analyzing data needed for the revision of allocation standards would have been impossible without the extensive cooperation of the industry itself, but in spite ofthe work by engineers furnished hy the industry, It has been necessary to keep a Commission staff devoted exclusively to work on matters pertainmg to that hearing. The expiration of the ,North Amcrican Rcgional Broadcasting Agreement (NARBA), in March of 1946, required investigation of an interim arrangement for cooperation between the North American countries, and such an agreement was consummated at 1Vashington after a conference with members of the State Department, industry engineers, and attorneys and representatives of the foreign govern ments concerned. 2. APPLICATIONS On August 7, 1945, the Commission removed wartime restrictions on the use of material and equipment for broadcast station construc tion and announced that, beginning October 7, it would resume normal 9 10 REPORT OF THE FEDERAL COMMUNICATIONS. COMMISSION consideration of applications' for new stations and changes in existing stations. This action prompted an unprecedented number of requests for construction permits. At the end of the war there were approximately 319 applications pending for new standard broadcast stations or for major alterations in existmg stations. At the time of the August 7, 1945, announcement it was thought that, after a peak in the number of requests by those who had deferred filIng applications because of the wartime restrictions had been reached, a subsequent decline would follow. On the con trary, the demand for standard broadcast facilities has remained at' approximately the same level and, if anything, has increased from month to month. The increased workload is reflected in the following table: Licensed stations Outstanding , c!8nstruction Total stations permits [or authorized now stations ----------------------------------- June 30, 1945~• _ Aug. 7, 194IL . . __ lune 30,UI:ttL~. _ 931 936 961 " "254 .., 961 1,215 At the close of the fiscal year, applications for a new stations or major changes in existing stations were being handled at the rate of approximately 100 a month. Applications continued to be filed at approximately the same pace. In addition to the work in processing applications, the duties of the Hearing Section have been amplified to a corresponding degree. Approximately 529 applications in hear ing status remained to be disposed of. 3. CLEAR CHANNEL HEARING The general public hearing to determine what changes, if any, should be made in present policies on allocation of clear channels m the standard broadcast band was in progress during the fiscal year, the first session being held for 2 weeks beginning January 14, 1946, with another session in April, and a third session in July. More than 4,000 pages of testimony and over 300 exhibits are in volved. Extensive cooperation with industry engineers was obtained in research and analysis leading to new knowledge of the signal intensi ties required and obtainable for service. In addItion, information as to the present coverage of all standard broadcast stations, which was considered fundamental to a proper decision on the issues of the hear ing, was prepared with industry engineers, and freely exchanged be tween the interested parties to the hearings. Approximately 600 man-days were spent by industry engineers working in the Commis sion's offices, at no expense to the Government, in preparation of part of this basic study, and at least as much time was spent by industry engineers in their own offices on the remainder of the woject. REPORT OF THE I'EDEIlAL COMMUNICATIONS COMMISSION 11 4. CHANGES IN STANDARD BROADCAST POLICY Siguificant changes during the year in Commission policy affecting standard broadcast may be summarized as follows: (1) Order 107, requiring the operation of standard broadcast stations with reduced power in order to conserVe tubes and other equipment, rescinded August 1, 1945. (2) Order 94-A, providing for relaxation of the minimum operating schedule, rescinded May 9, 1946. (3) Order 91-C, relaxing operating requirements, rescinded effective August 1, 1946. . (4) Policy statement of February I, 1946, dismissing applica· tions in direct conflict with sections 3.2, 3.22, and 3.25 (a)"of Com. mission's rules. (5) Policy statement of June 21, 1946, placing certain class of applications for operation on clear channels, in pending file and deferring action thereon until close of dear channel hearing. (6) Policy statement of August 9, 1946, placing all applications involving use of 770 and 1030 kilocycles, in pending file and de ferring action thereon until the close of clearchannel hearing. 5. INTERNATIONAL Study was continued by industry, the Department of State and the Commission on United States' proposals for a revision of the Inter national Telecommunications Convention, as well as the annexed General Radio Regulations. Proposed revision of artide 7 of the General Radio Regulations to enlarge the standard broadcast band to include 540 kilocycles will be considered at the world conference, on which a preliminary five-power meeting in Moscow was scheduled in the fall of 1946. • The third Inter-American Radio Conference at Rio de Janeiro in September 1945 included proposal to allocate frequency bands of 535 to 1605 kilocycles for broadcasting only. On January 4, 1946, a public meeting was held looking toward a North American Regional Broadcasting Engineering Conference to continue the terms of NARBA, which expired March 29, 1946, and to consider certain Cuban demands for ad'Clitional broadcast facilities, made at the Rio de Janeiro Conference, affecting nine United States Class I-A channels. On February 4, 1946, the North American Regional Broadcasting Engineering Conference was convened in Washington. On motIOn of Cuba, thename was changed to the Second . North American Regional Broadcasting Conference. During this session, Cuba made demands on United States clear channels which provoked considerable discussion. The matter was resolved when the Bahama Islands relinquished their use of 640 ·kilo cydes in Cuba in exchange for 1540 kilocycles on which the United States obtaned Class I-A privilege but which was, in turn, granted to the Bahamas subject to certain experimentations and the possible use of another frequency to be suggested by the United States. 12 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION The final agreement, signed on February 25, 1946, is known as too Interim-Agreement (Modus Vivendi). It extended for a period of 3 years the provisions of the NARBA except as modified; outlined procedures for the exchange of proposals looking toward a new NARBA; set the date of· September 15, 1947, for a third conference to be convened in Canada; established a North American Regional Broadcasting Engineering Committee which, for the first lmown time in -radio history, authorizes engineers aT one country to make engineer ing investigations of the facilities of another country; and granted eight special Class II assignments on Class I-A clear channels. The eight special Class II assignments b>1.Ven Cuba on regional channels were made within the eXIsting provisions of the NARBA. Of the1~assignments on Class I--A channels, five United States fre quencies were affected- 850 kilocycles, which had been broken down oy the Bahamas; 670 and 890 kilocycles, which had not previously been nsed by any other nighttime statrons; and 830 kilocycles on which there is a Mexican nighttime assignment previously made at the Washington Engineering Meeting, January 1941. Haiti was not rep resented at this conference nor did it sign the final agreement. FOllowing the Second NARBA Conference, Mexico and Cuba undertook to modify or enlarge their agencies concerned with standard broadcast as evidenced by their increased interest in United States assignment affecting these two countries. Mexico deleted outstanding notifications not in operation and removed two high power stations (XERP and XEAW) from the. Mexican-United States border. Canada, prior to the lifting of the freeze order on United States applications, made assignments for 30 odd new or increased facilities. In general, the trend of foreign assignments was to increase existing facilities and where possible, with the exception of Canada, to make new assignments not requiringdirecti~nalantennas. 6. FINANCIAL DATA Standard broadcast income figures for the calendar year 1945, while showing larger gross revenues, indicated that increased expenses had reduced the net income of networks and station groups below that of 1944. The following comparison is based npon reports by 4 major and 6 regional networks and 901 stations in 1945 and 4 major and 5 regional networks and 875 stations the year previous: . Standard broadca8t 'rom Networks and standard stations: , Investment in tangible broadcast property: OriJ;:inal cost. . . _ Depreciation to date under present ownel" _ Depreciated cost _ Revenues from !'-ale of network time_.~__ Revenues from sale of nonnetwork time •~'__ Commission's paid refJresentatives, etc._. _ Revenues from sale 0 talent, etc _ Total brQadcast revenues • _ Total broadcast expenses _ Broadcast service income 1 ._. _ See footnote at end of table. ]945 $88,101,940 46,506.921 41,695,019 133,973,5:m 176,510,510 43,923,466 32,777,553 299,338, 133 215, 75.1, 845 83,584,288 1944 $82, 997,650 42, 445, 377 40,552, 273 129,3G9,1){)1 158, 273, 246 41,303,215 28,959,079 275,298,611 185, 02;), 760 90,272,851 Peroentincrease or (decrease), 1945 over 1944 6.15 9.57 2.57 3. .56 11.52 6.34 13.19 8.73 16. 61 (7.41) REl'ORT OF THE FEDERAL COMMUNICAUONS COMMISSION 13 Standardbroadca8t~Continued 'tern , Newworks Bud their to key stations: Revenues from timo 8ulcs . _ Revenues from sale of talent, etc _ 1'otal broadcast revenues. . __ . " Total broadcast expenses _ Broadcast service income 1 _ Standard stations, excluding 10 key stationll or networks: Clear channel 50 kilowatts: Total broadcast revenue.'l. • _ Total broadcast expenses~_._ Broadcast service income , _ Clear channel [j to '20 Ifilowatts: Total broadcast revenues _ ~~~~~~~c;'~r~x~~~-i_-_-_-_-~~=:::::::~::::::: IWgional: Total broadcast revenucs _ Total broadcast expenses _ Broadcast service income 1 _ Local: ~~~~~~:~~~~=~:~~._--~::::::::::::::::::: Broadcast service income 1 _ Number of employees of networks and standard stations (as,of Dec. 31) • _ Total compensation for tho year c _ 1945 $68, 669, 076 16,482, 799 85,151,875 67,001,351 18,150,524 1,219,715 761,385 458, 330 438, '" 336,618 101,9<16 328,594 221,651 106,943 94,374 71,818 22,556 37,757 Il6, 267, 274. 1944 $i3, 656, 085 15,374.,364. 79,030,449 58,746,703 20,283,746 1,157,770 661,523 496, 24.7 421,800 292,269 129,534 307,493 193,113 114,380 84,282 60, 861 23, 421 34,281 99,773,425 Peroentincroose or (decrease), 1946 over 1944 7.88 7.21 7.75 14.05 (10.52) 5.35 15.10 (7:.64) \ 3.97 15.17 (21. 30) 6.86 14.78 (It 60) 11.1'l7 18.00 (3.69) 10.14 16,53 I Broadcast revenues less broadcast expenses before Federal income tax. 7. STAnSTICS As of June 30, 1946, there were 961 regularly licensed standard broadcast stations, or 30 more than repOl:ted in 1945. However, out standing construction permits for new stations numbered 254, and 680 applications were pending. Only 4 standard broadcast stations were deleted during the year. [ Page 14 in the original document is intentionally blank ] CHAPTER III Nonstandard Broadcast CHAPTER III-NONSTANDARD BROADCAST 1. FREQUENCY MODULATION (FM) BROADCAST SERVICE 2. TELEVISION BROADCAST SERVICE 3. INTERNATIONAL BROADCAST SERVICE 4. NONCOMMERCIAL l'lDUCATIONAL BROADCAST SERVICE 5. FACSIMILE BROADCAST SERVICE 6. REMOTE PICK·UP BROADCAST SERVICE 7. ST (STUDIO·TRANSMIITER) BROADCAST SERVICE 8. DEVELOPMENTAL BROADCAST SERVICE 9. STATISTICS CHAPTER III-NONSTANDARD BROADCAST 1. FREQUENCY MODULATION (FM) BROADCAST Rapid postwar expansion of FM broadcasting is indicated in the mounting number of authorizations and applications for this new medium of program service. Removal of the wartime "freeze" on construction enabled the Com mission to consider an accumulation of abont 600 applications for commercial FM stations. Since most of these had been filed under the old rules and needed additional information, the Commission expe dited matters by making conditional grants snbject to later approval of engineering and other details. The first group of FM grants on this basis was announced in October of 1945. The res",lt was that the 48 FM broadcast stations functioning at the close of the war began to be augmented as quic,kly as materials and personnel could be obtained. At the close of the fiscal year, 55 FM stations were serving 32 cities and surrounding rural areas, 456 new stations had received initial authorizations, and some 250 applications were pending. Because of reconversion problems, the Commission permitted low power nnits to be used by stations while new equipment was being manufactured. At the request of the Senate Small Business Com mittee, the Commission made a survey of probable prices and delivery 15 16 REPORT OF THE FEDERAL COMMUNICATIO.NS COMMISSION dates for principal items of equipment for FM stations. The results were summarized in a Commission release in December 1945 and later appeared in a booklet issued by the Committee as an aid to those interested in enteringthis field.. During frequency allocation hearings in the previous fiscal year, FM received important consideration. This service had started on the 42-50 megacycle band, but troublesome sky-wave interference developed. _ "Public interest," pointed out the Commission, "requires that FM be established in a permanent place in the radio spectrum before a considerable investment is made by the listening public in receiving .sets and by the broadcasters in transmitting equipment." Accordingly, in June of 1945, the Commission allocated the band 88 to 106 megacycles for FM, including 70 channels for commercial FM service and 20 channels for noncommercial educational FM broadcast. In addition, the band 106-108 megacycles (10 channels) was made available to facsimile with provision that it might later be utilized byFM. In January of 1946, the Commission heard a petition requesting restoration of the old FM band. Upon analyzing the testimony and data, the Commission concluded that the use of'two bands for FM broadcasting was undesirable, that interference would continue to be a serious problem on the old band, and that an excellent FM service would be provided in the high band. Accordingly, stations on the 42-44 megacycle band were given until January 1, 1947, to make the transition. During the summer of 1945, the Commission held conferences and hearings to determine what changes were desirable for FM, and these were incorporated in new rules and engineering standards adopted the following August and September. Channel and power assignments were made in the new band, with provision for use of interim equipment until full eonstruet-ion authorized by the new assignment could be com pleted. Having thus encouraged early commencement of this new service, the Commission in .July of 1946 warned that if grantees and permittees were not diligent in getting "tarted they would be subject to hearing to determine whether their grant.; should be cancelled. At the beginning of 1946 it was estimated that about half a million FM receivers (most of them capable of receiving standard broadcast) were in use. A Commission survey in February indicated that only 9 percent (1,800,000 sets) of the contemplated 1946 receiver productIOn would include FM. -Accordingly, manufacturers were urged to pro vide a greater percentage of sets capable of receiving the new service. Equitable distribution of FM facilities was provided in a tentative Nation-wide allocation plan for the 60 metropolitan and rural channels. This was used as a basis in making assignments and in designating for hearing applications for areas where the number of requests exceeded the number of available channels. In May 1946 the Commission announced proposed rules reducing the then three classes of FM stations totwo, to be termed Class A (forme;ly community) and Class B (formerly metropohtan and rural), whIch were adol;'ted in July. Followmg a hearing in July 1946 on requests for reservation.of FM channels, the Commission announced that it would reserve, untIl June 30, 1947, every fifth channel in cities or areas where five or more Class REPORT OF THl!r'FEDERAL COMMUNICATIONS COMMISSION 17 B channels were tentatively allocated. No allocation plan or reserva tion policy IIpplies to the 20 Class A channels, and it is expected that these channels will be available indefinitely for all but the most congested areas. 2. TELEVISION BROADCAST SERVICE 'When the return of peace permitted consideration of new radio sta tion construction, 158 requests for comnlel'cial television facilities awaited Commission action. Most of these applications were incom plete and none conld be processed until new rules and regulations and engineering standards had been formulated and adopted. Between VJ-day and December of 1945, the Commission's staff and representatives of the television industry cooperated in providing a television station assignment plan which, through equitable distribu tion of facilities throughout the country, assures the most efficient use of the 18 channels between, 44 and 216 megacycles allocated to this type of broadcast. This joint effort culminated in the adoption, in Novem ber and December 1945, of new rules and engineering standards cal culated to aid the developnlent of'comnlercial television service. There Was some difference of opinion in the industry as to whether postwar television emphasis should be placed on experimentation in the higher frequencies above 480 megacycles, where wider channels are available for color and for black-and-white pictures of greater detail, or whether television should proceed with monochrome in the lower frequencies (44-216 megacycles). The industry had urged that television channels be shared with sev eral low-power services in the special and emergency fields. In the early months of 1946 considerable attention .was given to a plan for the shared use of television channels by other services. However, due to the incomplete information available on the needs and character of the proposed sharing services, a satisfactoryaTl'angenl~llthad not been evolved by the end of the fiscal year. Six television stations were on the air during the war. Between December 1945 and March 1946, they changed channels to conform with the allocations s'et forth in the Commi1:ision's new rules and tegulations. Of the 1.58 applications for new television stations on file at the end of the war, approximately 80 were subsequently withdrawn. The reasons given were either a desire to wait for color television or that television required a greater capital outlay than the applicants had anticipated. . Sixty-five other applications were for facilities in 11 metropolitan districts where the numbet of requests exceeded the channels allo cated. These were designated for hearing. By the end of the fiscal yeat substantially all such 'hearings had been concluded, or hearings were made unnecessary by application \vithdrawals· or by reason of channels being found to accommodate the remaining applicants. By May of 1946, a considerable number of applications not subject to hearing had been brought into conformity with the new tules and engineering standards so that by the end of the fiscal year there were 24 construction permits outstanding and 40 more applications were being processed. 18 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION Television development was aided dnring the year by fnrther exten sion of the coaxial cable system of the American Telephone & Tele graph ,Co. A network video program on Lincoln's Birthday in, 1946 was made possible by completion of the New York-Washington section of this cable. New radio relay devices also offer possibility of carrying television programs far from their place of orIgin. Mean while, attention is being given to the possibility that television, as well as facsimile, may some day be linked with telephony so that parties to telephone conversations may see as well as hear. . 3. INTERNATIONAL BROADCAST SERVICE During the fiscal y.ear all international broadcast stations continued to be-programmed and operated by the Federal Government. This direction was assumed by the Office of International Information and Cultural Affairs of the Department of State when it absorbed elements of the Office of War Information and the Office of Inter-American Affairs which controlled these stations during the war. Cessation of hostilities enabled six transmitters leased from common carriers to be returned to their former uses. Simultarieolsly, pro gram hours were reduced on the remaining 37 transmitters and the program emphasis shifted from psychological warfare to troop enter tainment and news. Even with the reduced number of transmitters an acute shortage of frequencies still exists in this service, requiring the continuation of broadcasting on frequencies formerly assigned to other services. In the closing months of the year, meetings of the, Security Council, the Economic and Social Council, the Atomic Energy Commission, and the Health Commission of the United Nations were broadcast, as well as commentary and summaries of United Nations proceedings in French and English. Three transmitters were devoted to speeding this material to listeners in many nations, and the programs were rebroadcast by several domestic standard broadcast stations. 4. NONCOMMERCIAL EDUCATIONAL BROADCAST SERVICE Noncommercial educational broadcast stations are licensed princi pally to school systems and universities for furnishing educational programs to units in a school system, as well as educational and enter tainment programs to the public. Twenty channels have been allo cated for this service (88-92 megacycles) as a part of the FM broad casfband. The 6 licensed stations are presently employing equipment in the old noncommercial educational band of 42 to 43 megacycles prepara tory to moving to the new band. A total of 24 stations had been authorized in this service by the end of the fiscal year. Since 18 applications were pending, it appears that a much larger number will come into being next year as postwar plans of schools and universities develop. Present information indicates that most states have plans for operation of statewide FM educational networks, some of which will link state, county, and municipally operated sta tions to obtain wide c!lverage for educational FM programs. Because noncommercial educational FM broadcast stations employ the same type of transmitting equipment used by commercial FM REPORT OF THtI l!lIlDERAL COMMUNICATIONS COMMISSION 19 stations, and since FM receivers sold to the public include both the noncommercial educational and, regular commercial FM channels, equipment may be obtained more economically and the two FM serv ices grow mutually. 5. FACSIMILE BROADCAST SERVICE Facsimile provides for the reception of li'rinted matter and pic tures by the use of specially designed radIO receivers. Operation continued on an axperimental baSIS during the past year, and it appears that equipment and reproduction have been considerably im proved. The technique has been developed to a point where print approximatin~the SIze of newspaper type can be reproduced with clarity. Frequency allocations provide that facsimile broadcasting may be authorized on any- channel within the 88-108 megacycle band as a service separate from aural broadcasting. FM stations may. of course, be authorized to transmit facsimile. During the year three stations continued facsimile experimenta tion in the 25me~acyclebandfor~erlyallocated for this purpose, and several FM statIOns were authOrIzed to conduct expernnental fac- simile transmissions on their regularly assigned FM channels. Although the band of 470 to 480 megacycles has also been set aside for experimental facsimile, no stations have as yet been authorized for thIS I;jl,llge.· NO'Tules or engineering standards have been adopted for opera tion of facsimile OIl a regular or commercial basis, but manufacturers of facsimile equipment are now preparing recommended standards for consideration by the industry and the Commission. Uniform standards must, of course, be provided so that all facsimile broadcast stations will transmit a signal which is capable of operating facsimile reproducing equipment of any make. Upon such standardization and the promulgation of rules for this service, it is expected that facsimile broadcasting will become a very useful public service. 6. REMOTE PICK·UP BROADCAST SERVICE Remote pick-up' [fonnerly known as relay] broadcast stations are employed for furnishing a program circuit from pick-up points to the main station when wire circuits are not available. During the war years such equipment had limited use, but interest and activity in thIS service are now increasing. During the fiscal year 27 applica tions for such stations were granted, bringing the total number of stations authorized to 573. In July 1946 the frequency allocations for the 152-162 megacycle band were proposed, including 14 channels of 60 kilocycle width for relay broadcast use. 7. ST (STUDIO-TRANSMITTER) BROADCAST SERVICE To provide large service areas, some FM broadcast transmitters are located on mountain tops because of the importance of antenna height to coverage. Telephone lines are not alwa:rs available or adequate for program CIrCUIts, and ST broadcast statIOns are nsed for trans mittmg the programs from the studio to the transmitter. No new 20 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION ST stations were authorized during the year, due principally to de layed FM broadcast station construction at such locations. Following the frequency allocation hearing, the band of 940 to 960 megacycles was allocated for this service, which subsequently was modified to 940-952 megacycles. No ST broadcast stations have as yet been construeted for use of this new band, but it is expected that a considerable number will be employed as soon as additional FM broadcast stations are placed in operation. 8. DEVELOPMENTAL BROADCAST SERVICE Developmental broadcast stations are useful in connection with equipment. development, propagation tests, and other experimenta tion requiring radio transmission. For example, FM broadcast trans mitters and antennas are tested to compare operating characteristics with theoretical predictions. During the year some developmental broadcast stations have conducted measurements of radio wave propa gation in the new FM band, employing various types of transmitting antennas. At the end of the fiscal year 34 developmental stations were authorized. 9. STATISTICS At the close of the fiscal year there were 825 nonstandard broadcast stations, an increase of 65 over the prevfous year. A tctal of 89 new stations were added as compared with 24 deleted. The following tabulation shows these licensed stations by classes: . High frequency(FM-commercil\l)~_ Bi~hfrequency (experimllntal) . _ Tc evision (commcrcia!) . __ Televi~ion(experimental) _. _ InternationaL, _ Noncommercial educational. . . __ Facsimile_. __ ._. _ Relay (high-freQuency). . _ Relay (low-frequency) ..__ . . __ . __ • _ Studio transmitter~ST)------------------------ DevelopmentaL . _ Class II (experim('ntlll) . _ As of Added Deleted A<;of Juue 30, 1945 June 30, 1946 53 9 0 62 2 0 1 1 9 I' 2 25 47 11 0 " 38 0 1 37 12 12 0 24 3 0 0 3 2119 I' • 308 261 9 , 265 , 0 1 7 27 12 6 34 1 0 0 1 CHAPTER IV Common Carriers 1. TELEPHONE (WIRE AND RADIO) 2. TELEGRAPH (WIRE, CABLE, AND RADIO) CHAPTER IV-COMMON CARRIERS 1. TELEPHONE (WIRE AND RADIO) SERVICE AND FACILITIES oowtruction ofwire facilities.-An extensive construction program Was necessary dnring the year to meet increasing public demand for telephone service. In addition to 16 applications on hand from the preceding year, the Commission received 253 new requests for wireline construction, acquisition, extension, and leased projects. Of this num ber, 249 were at'proved, including 239 construction applications. The increase in wire construction is indicated in these figures for thepa~t 3 years: Fiscal year Projects Cost . Miles of Miles of Miles of cable coaxial units open wire --------1--·------------- 1944~•••_ 1945. • _ 1946. . __ • ." _ 121 $9,582,239 210 70,091,140 239 78, 896, 450 574.8 2, 378. 3 3,193.8 o 7, llO2 16,580 7.968 2.963 12, 261 The Bell System. added approximately 2,478,000 miles of toll message channels, which increased its previouR total by 22.7 percent. About 90 percent of the new channels were provided with carrier systems, The emergency type "EB" carrier systems were used to provide 800,000 channel miles. Plwnned toire projeots.-!fhe American Telephone & Telegraph Co.'s program for installing 6,000 to 7,000 miles of coaxial facilities was mentioned in previous annual reports. During the year the Commis sion authorized construction of 2,150 route miles of coaxial cable carry ing 16,780 coaxial cable miles and involving an expenditure of $41, 624,000. Coaxial cables are designed for the transmission of high frequencies suitable for telephone, telegraph, radio broadcasting and television transmission. 21 22 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION VolWlne and speed Of toll serviee.-Telephone toll traffic continued to grow to new peak levels. During the year the Bell System handled 850,000,000toll-b~ardcalls and 669,000,000 short-haul calls. These figures represent mcreases over the preceding year of 16.4 and 7.7 percent, respectively. The average time required to complete toll board callsi~June 1946 was 3.2 minutes, a decrease of 0.2 of a minute compared WIth a yeara~o. . U. se of rMqrdinrJ. de,!,w,,:,.--On October 31, 1945, the Commission l~st~tu~ed~nInvestIgatIon Into the use of recordIng devices in Connec. twn WIth mterstate and foreign message toll service. As the result of public hearings held January 10-11,1946, the Commission on August 6 'ttacking the lawfulness of Bell System charges for press private line teletypewriter service. The Commission concluded that, as " result of rate reductions made since 1940, the complaint had been substantially satisfied. "Service charges" by Iwtel., etc.-In view of the fact that the United States Supreme Court, in May of 1945, upheld the Commission's jurisdiction over "service charges" or "surcharg-es" by hotels, apart ment houses and clubs on interstate and foreign telephone calls, and since various hotels and hotel associations did not press their pre viousl:rfiled complaints,questi~ningprohibition of sueh charges, the CommISSIOn, on May 10, 1946, dlSIDlSSed furtherproceedm~. Reductions in over8eas rate8.-As a result of negotiatwns br the Commission with the American Telephone and Telegraph Co., a 721617-47-3 24 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION pattern of reduced rates for the initial 3-minute period for overseas message toll telephone rates was agreed to as follows: Air miles I)....DOIL" ..• _ 501-1,000. __ • ._.__ '._ 1,001-2,000 _ Day $4.50 6.00 7.50 Night and Sunday $3.00 4.50 6.00 Air miles 2,001-3,000. _ Over 3, 000 . _ Day $9. 00 1200 Night and Sunday' $7.50 9.00 Such day rates were established between the United States and 29 foreign countries: Argentina, Australia, Belgium, Brazil, Chile, Den mark, Egypt, Eire, France, Germany, Great Brita-in, Hawaii, Italy, Japan"Netherlands, New Zealand, Norway, Paraguay, Peru, Philip pine Islands, Portugal, Puerto Rico, Salvador, Spain, Sweden, Swit zerland, Union of Soviet Socialist Republics, Uruguay, and Venezuela. By the close of the year the stipulated night rates were in effect to Eire and Ureat Britain. During the year, the American Telephone & Telegraph Co., RCA Communications, Inc., and Press 'Wireless, Inc., filed amended traffic schedules reducing their rates for program transmission services be tween this country and various foreign points. Bell System license contract8.-As part of a broad review of factors entering into the cost of telephone ser-vice, members of the Commis sion's staff cooperated with a subcommittee of the Special Committee on Telephone Regulation of the National Association of Railroadancl Utility CommissIOners in studying the services performed by the American Telephone & Telegraph Co. for its associated companies and long lines department incident to "license" contracts. Division of revenue contracts.-Inquiry into the division of inter state telephone toll revenues between the American Telephone & Tele graph Co. and its associated companies has been made, and the Com mission's program calls for continuing cooperative studies with State commissions on the separation of telephone plant and expenses in this connection. SUPERVISION OF ACCOUNTS Original cost restatements and disposition of plant acquisition ad ju8tm,ents.-Application of the Commission's regulations has accomp lished adjustments of net book cost of plant through charges to income, surplus or other accounts, thus reducing previously overstated costs by the carriers. These adjustments amount to more than $12,000,000 for all telephone companies whose accounting is subject to regulation under the Communications Act. In addition, and as a result of the Supreme Court decision noted in Chapter I, the New York Telephone Co. was required to adjust its net book cost by more than $4,000,000, prineipally by charges to surplus and credits to depreciation reserve. By the same token, arrangements have been made with other Ben System companies that are expected to result in similar adjustments amounting to $16,000,000. . Continuing property records.-Studies are being continued jointly with the State commiSsions and thet~lephoueindnstrywith a view to developing procedures consistent with the uniform system of accounts that will (a) provide a continual and perpetual reeord of quantities and costs of plant as of a certain date and reflect changes subsequent REPORT OF THE FEDERALCOMMUNreAnO~SCOMMISSION 25 Ix> that date, (b) provide data ford~termina~ion?forigi~a.lcost of plant retiI'(Jd, (c) serve as a basIs of InventOrIes wIth a mInImUm of field work and as a basis for summarized 1?lant records, and (d) fur nish pertinent data necessary for determwmg plant mortahty, serVIce lives and depreciation. charges. Relief and pensi01I8.-Preliminary study was made of revisions !n the Bell~ystemactuarial computatIOns and the resultant changes In payments into pension-trust funds. The matter of additional lump sump~ymentsinto these funds receivedcon~ideration.. Study was also bemg given to request by the Bell compames to dIscontInue sepa rate accounting for service-pension payments to employees retired be fore the adoption of the accrual plans of accounting for pensions. Further studies were made as to the propriety of the methods used by certain carriers to determine the adequacy of their pension-trust funds" and to the practice of charging current operating expenses with the eost of pensions based on service prior to the adoption of a,pension plan. Other studies involved consideration of whether pension plans contained provisions which might discriminate against certain classes of employees. Uniform SY8tem of account8.-Several amendments were made to the uniform system of accounts prescribed by the Commission. Included were provisions which simplified the accounting for large numbers of relatively low-cost items of materials. In cooperation with several State Commissions, progress was made toward a general revision for Class A and Class B telephone companies. MiBcellaneou8.-0ther activities of the Commission in this field include: Providing for the maintenance of an index of the records of tele phone companies that are required to be preserved. Revision of the annual report form (Form M) for telephone com panies to eliminate certain detailed information not deemed necessary during the continued shortage of personnel and to clarify certain re quirements, particularly with respect to the reporting of Federal in come taxes. ECONOMICS AND STATISTICS Economic studie8.-In continuing study of telephone service throughout the country, data relating particularly to the availability of telephone service on farms was collected and analyzed. On several occasions, technicaland e.conomic data onthi~,subje~twerem~1,de:;tvail able to Congl'ossional committees considering bills to extend telephone ~el'viceto rural areas. Additional information was obtained during the year through the cooperation of the Department of Agriculture and the Bmeau of the Census. These facts, together with various data prepared by the telephone industry, are currently being analyzed. Statistics and general studies.-Annual reports containing financial and operating data for 1945 were filed by 153 common carriers and 36 controlling companies. Included were 125 telephone, 14 wire-tele graph and ocean cable, and 14 radio-telegraph carriers. "Statistics of the Communications Industry in the United States," published anually by the Commission and obtainable from the Super intendent of Docnmimts, .contains detailed·information on the subject. Some financial and operating highlights from annua! reports of tele phone carriers are here shown. 26 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION Telephone carriers [tem 194' 1944 Percent in crease or (de· crease),I94<5 over 1944 Investment in plant and equipment. . .___ $6,000,028,722 $5,866,316,360· 3.48 Depreciation and amortization rcserves_ $2, 1{)7,674, 373 $1,987,628,404 9.06 NetlnvestmentmplantandeqUipmenL .___ _ $3,892,354,349 $3,868,687,956 .61 LocalservICef(lVenues.______________ _ $1,108,350,679 $1,052,143,699 5.34 ~a~ri~:;~~~~~1;~~~~~:~=:~==============:~~~===:;~~::!~:zll::~5:~J~~:~:~ Taxes, incl!1ding income and exoess profits__~=======$420,740,213 $438,581,635 (4.07) Net opera.tlllg income after all taxes_________________ $274,321,589 $231,303,259 18.60 iii~i~e~~epaid=====:========:~=========:=:==::::::I~~~i~:~n~:~~:~ro:~~3.49 Company telephones: 3.86 AvJ~~;~~i~~i~~ii~~1~i~~i~~~~i~tiii~i&~~~~~~l~;~:;~l~;g:;~~t~ ~fN_\~~~~~~~:~:~:~=~=~~~:~:===:~~~~~:~=:==:==3'm;~f~~:3,~:~:~If:~ Number of employees at end ofOctober:~~~o~3'09"8.c:",o"I~=~~3'O'~'.c:308""I=~=c:gC'.[~3 MahL~_._________109,778 102,2.10 7.38 Female .___________ 288,887 263,.078 9.81 ======--== Total pay roll for the year~__$936,689, 151 $807, no, 401 16.05 I Intercompany general service and license fees BIld rents, amounting to approximately $37,000,000 for 1945.J.and $35,000,000 for 1944 have not been eliminated. ~.t'9.rtly estimated by the reporting carriers. 2. TELEGRAPH (WIRE, CABLE, RADIO) SERVICE AND FACILITIES Const1'UCtion of wire facilities.-During the year, 73 applications for wire telegraph construction certificates were filed with the Commis sion, which had 6 on hand from the preceding year. Of these, 75 were granted and 4 were pending. AuthorizatlOns involved the con struction of 404,345 channel miles of carrier systems at an estimated cost of $1,960,749, the leasing of 3,100 miles of telegraph channels and 7,994 miles oLtelephone channels at an annual rental of $296,645, and the removal of 5,500 miles of wire and 588 miles of pole originally costing $513,364. Modernization plan of Western Union.-The Commission embarked npon an informal investigation of the $60,000,000 modernization plan of the Western Union Telegraph Co. This program, by which Western Union expects to rednce its operating costs and to improve service, contemplates the construction of 2,700,000 miles of telegraph radio-relay systems and the leasing of some 1,000,000 telegraph channel miles from the Ben System, which would permit it to dispose of the greater part of its extensive pole and wire lines. In addition, pro vision is made for establishing 30 large message centers equipped with reperforator-switching systems, where the relaying of messages will be largely automatic, and for the improvement of methods of terminal handling. The program calls for completion by the end of 1949. Under its order of June 4, 1946, the Commission is inquiring into the progress being made in this program and the specific benefits which may be expected to accrue to the public and to Western Union. (See also "Rates and Tariffs.") REPORT OF THE'FIjJDE&AkCOMMUN,ICATION&'COMMISSION 27 . Investigation of ,interstate telegraph servwe.-In approving Western Union's petition for a rate increase (see "Rates and Tariffs")I the Commission reg&rded such relief as a "temporary expedient' which would not of itself solve the company's basic difficulties and felt it necessary to take stock of the domestIc telegraph problem so that appropriate measures may- be invoked. Accordingly, the Com mission ordered a comprehensive investigation into all phases of Western Union's present and future operations. In so doing, the Commission pointed out that such an exhaustive inquiry could not be conducted under current limitations on Commission funds and per sonnel, hence it would have to seek additional money. Speed of servwe.-The quality of service provided by Western Union declined somewhat during the year. The average time required ill a message center to relay the fastest 95 percent of ordinary full-rate messages was 9.4 minutes in 1946 as compared with 8.7 minutes in 1945. The average percent of such messages completed in 15 minutes . was 84.3 and 88.1, respectively. The average time required by the Bell Telephone System to establish teletypewriter exchange con nections between subscribers remained at 1.6 minutes. Domestic radiotelegraph.-Paralleling activities in the develop-. ment of radiotelephony, the lVestern Umon Telegraph Co., American Telephone & Telegraph Co. and certain organizations which are not communications common carriers have been granted experjmental authorizations looking to the development of microwave radio relay systems capable of handling telegraphic as well as other types of com munications. (See also "Expenmental Radio Services.") lVestern Union is testing an experimental miCrowave chain between New York and Philadelphia solely for the purpose of accumulating technical data. Insofar a.s commercial operation of a microwave relay system is involved, Western Union's planned first step is the development of a triangular system connectmg those two cities and Pittsburgh and Washington. Necessary sites have been acquired and installatIOn is progressing as rapidly as equipment is made available, with the expectation that the system may be ready for service in March 1947. Additional microwave expansion is later contemplated between Pittsburjlb, Cleveland, Chicago, and Cincinnati. Discont-inuanee, reduction or impa:irment of ser'Vwe.--On July 18, 1945, an informal conference was held on proposed rules to implement an amendment to section 214 of the Communications Act, whIch pro vides that no carrier (telegraph or telephone) subject to the act shall discontinue, reduce or impair service to any community without first obtaining authority from the Commission. During the year, 329 applications of this nature were received in addition to the 47 then pe.nding. Of this number, 276 were granted. In most caSes where service was terminated, alternate service was available. Deli-very of telegrams.-Upon consideration of complaints that telegrams were being delivered in New York Cit.y by mail, and by telephone to unauthorized third persons, the Commission on Feb ruary 7, 1946, instituted investigation into Western Union's delivery practices. Eight days thereafter the Commission amended its order to investigate the methods used by all telegraph carriers subject to the act in delivering telegrams by means other than messenger or tie-line, 28 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION and forwarding telegrams between cities by mail and special messen gers. On May 29 the proceedings were broadened to include a general investigation of the lawfulness of charges, classification, regulations and practices in connection with the pick-up and delivery of telegrams. RATES AND TARIFFS We8tern Union rate i1Wrease.-Following public hearings, the Com mission allowed Western Union, effective June 12, 1946, a flat over-all increase of 10 percent in its domestic interstate rates but denied Western Union's request to eliminate the 20 percent rate differential on Government messages. It found that 'Vestern Union waS cur rently operating at adeficit and anticipated a loss of about $12,000,000 in 1946 if its rates were not raised. The Commission concluded that Western Union would need substantially more revenue than it re quested "if it is to continue in operation as a solvent enterprise and provide satisfactory service on a comprehensive Nation-wide basis." It pointed out, in particular, that 'Vestern Union was faced with increasing competition from telephone and teletypewriter exchange services and air-mail services, besides being affected by increased wage costs and reductions in international telegraph rates. The Commis sion is not satisfied that the modernization program is the answer to Western Union's problems. However, in view of Prevailing eco nomic conditions and Western Union's dire need for additional reve nue, the Commission granted the rate increase for 1 year pending developments. 'SUPERVISION OF ACCOUNTS Original C08t 1'e8tatement of plant account8 and estahlishment and maintenance of continuing property 1'ecords.-Adjustments made since 1938 have reduced Western Union's net book cost by approxi mately $77,000,000 (exclusive! of about $43,000,000 pertaining to former Postal Telegraph plant). Further adjustments were deferred pending the effects of the modernization program on the adequacy of the company's depreciation reserves. Uniform system of accounts.-Chief among amendments affecting domestic telegraph carriers was elimination of the requirement tor detailed statements of traffic damage claims. Compilation of a list of retirement units, now in progress, will simplify property retire ment accounting procedure of wire-telegraph and ocean-cable carriers. Dep1'eciation.-This subject received particular attention in view of the prospective premature retirements of Western Union plant nnder its modernization program, for which only partial depreciation has been provided. Preliminary studies have been made of the com pany's proposal to amortize the unprovided for loss in service value of plant to be retired. Relief and pe'Mio'M.-Studies were continned with respect to the propriety of the methods and accounting pursued by certain carriers in determining and recording the cost of maintaining pension and other benefit plans. MiscellaneoWl.-The annual report form (Form 0) was modified to eliminate about 30 pages of detailed data not now deemed suffi ciently important to warrant reporting to the Commission. 'REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION 29 . The period of 6 months required for retention by domestic telegraph carriers of copies of telegraph messages was continued. Such carriers are requiredto retaiu these messages for all additional six months upon request by persons having bona fide interest in them. ' Regulations governing the preservation of records were amended to require the maintenance of an index by the domestic telegraph carriers of records which must be preserved under the rules of the Commission. STATISTICS Annual reports were filed by 28 wire-telegraph, ocean-cable and radiotelegrar.h carriers. Certain selected financial and operating items, complIed from the 'Western Union report, are shown in the succeeding table. Adequate data was not filed by that company to permit segregation of its ocean-cable and wire-telegraph operations. Statistical data relating to ocean-cable carriers will be found under the succeeding "International" section of this chapter. The Western Unton Telegraph 00. Item 1945 1944 Percentin .___________________ 318 - 431 452 477 .507 Zone polive__________________________________________ &5 94 88 85 88 InoorzonepoHce_____________________________________ 33 20 31 30 30 'ClottZ~3Zj~{7c61-) Zl'2 Some licensees operate as many as 200 or more mobile transmitter and receiver units under one license. It is estimated that approxi mately 23,000 mobile units are authorized for operation in this service. The increase in State police stations is due to expansion of existing facilities and installation of several new Smte communications sys tems. The increase of 198 stations in the municipal police class represents additional cities and counties which have installed their own communications systems. A large number of these new stations are authorized to use frequencies in the 152-162 megacycle band which have recently become available on a regular basis. The number of frequencies allocated for police radio stations in that part of the spectrum above 25 megacycles has been increased from 29 to 132. In addition to the previously listed figures, municipal and State police departments are authorized to operate approximately 125 radio control and automatic repeater stations on an experimental basis. Additional channels have been allocated for this purpose on frequencies above 900 megacycles. 44 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION MUNICIPAL FIRE RADIO STATIONS Though municipal fire radio stations numbered only 25 at the end of the fiscal year, this number is.expected to increase considerably. In consideration of the testimony presented at the allocation hearing and in view of the radio's contribution to increasing efficiency in fire fighting, the number of frequencies available for assignment to this Class of station was increased from 3 to 40 channels. Until recently, authorizations have been limited to cities with populations of 150,000 or more, while fire departments in smaller cities have used police radio. facilities where available. ' Radio communication can be utilized between the central fire station and the mobile fire-fighting units in the same manner as police radio systems. A new development is the use of the portable pack, or "walkie-ttllkie," which enables a squad chief at the scene of a fire to direct his men within 01' around a building. New York City, for example, already has 22 such fire-fighting units. FORESTRY RADIO STATIONS Forestry radio stations are authorized to Government and private instrumentalities responsible for the protection of forest areas. A total of 1,018 stations held licenses at the end of the fiscal year. These stations are operated by the State forestry or conservation departments to detect and control forest fires, protect watersheds, and conserve wildlife and natural resources in the forests. At the present time only slightly more than one-half of the States have forestry radio facilities. Radio affords a more reliable communication circuit between fire towers than land lines which are subject to damage by storms, falling limbs, fire and many other causes. This ocrvice should benefit frmn recent improvements in low power nlObile transmitting and receiving equipment and the very lightweight "handie-talkie'.' equipment. SPECIAL EMERGENCY RADIO STATIONS Special emergeney radio stations are utilized principally by public utilities such as ele.ctric power and urban transit systems. These organizations operate over 80 percent of the authorizations of this class. Such stations may communicate in emergencies jeopardizing life, public safe.ty, Imd property. However, rules Imd regulations were being drafted to establish a regular service for public utilities. Among organizations which have indicated interest are Rural Elec trificatIon Cooperatives, private gas and electric-power companies, oil pipeline operators, aud petroleum compauies. In the case of urban transit companies,bus~street railway, and interurban systems, radio tests show definite value for supervision, repair and traffic control. Direction of maintenance vehicles and restoring service disrupted by storm are two prineipal applications of this type of station. Both the Bell System and Western Union utilize trailers equipped with portable power units and antennas to bridge gaps in their systems while repairs are being made. The range of such operations may extend 20 miles but usually cover a distance of 3 or 4 miles to serve a particular project. A few special emergency stations have been operated by relief agencies such as the Red Cross during times of flood or other large scale emergencies. REPORT OFT~.~COMMUNICATIONS COMMISSION 45 4. RAILROAD RADIO SERVICE The railroad radio service, which started operation on December 31, 1945, is anew radiocommunication service to increase the safety and efficiency of railroad operations. Railroad radio has been ex perimented withfo~several years, but~ecisionto establish. the serv ice on a regular basIs was not made untJi a comprehensIve JllVestIga tion,which culminated in a public hearing in May 1944, demonstrated both its need and general practicability. Rules and regulations to govern the railroad radio service became effective on December 31, 1945, after a series of conferences with the industry and a further public bearing. Sixty fr"!luency channels were provided for exclusive railroad use, with addItional channels' available on a shared basis with other services. Since establishment of this service, many railroads have requested reclassification of their pl'cvious experimental authorizations. New applicants are undertaking extensive installation programs which wiJl require several years to complete. The growth of this service has been impeded somewhat by the lack of suitable radio equipment for use on railroad rolling stock. The most popular nse for railroad radio at this time is in yard and terminal areas. Direct radio links between the dispatchcr's office and switch engines are increasing the speed with which operations may be completed, thercby improving both freight and passenger service and reducing costs. This type of operation requires relatively little administrative change, and can be effected as quickly as equipment becomes available. Systems along the rights-of-way are more expensive to install and maintain, and their use must be coordinated with the manual or automatic block signal systems existing on slightly more than half of the main line trackage of the nation. However, It is this latter type of train radio service which, due to the increased element of safety, is expected to become the most important use of radio by the railroad industry. Accordingly, this class of station has been given priority in frequency assignment, a decision which has the concurrence of the As&ociation of American Railroads. There are approximately 124 authorizations for railroad radio systems in the experimental service in addition to 32 authorizations in the regular railroad service. Since each authorization may rep re_~eIItfrom 1 to 100 or more units, the actual number of transmitters authorized is much greater than these figures indicate.. Wartime developments in the basic principles of very high fre quency radio transmission are reflected in the design of specialized equipment with sufficient mechanical strength and freedom from electrical failure to withstand the rigorous demands of railroad service. 5. EXPERIMENTAL RADIO SERVICES GENERAL The experimental radio services are divided into three classes of stations, each of which is designed to provide facilities for specific types of experimentation. Class 1 stations are primarily for develop ment of eqUlpment such as antenna, tubes) nlethods of transmission, 46 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION and to study phenomena directed to the~eneraladvancement of radio. Class 2 stations are authorized for the mitial development of a new service, or a new method of operation within an established service. Stations in both classes are licensed to individuaJs or to corporations desiring to follow a prescribed program of research which shows pos sibilities of improving some phase of radio or of the existing servIces. Class 3 stations are open to persons interested in radio technique to the extent ofconductin~experiments on their own behalf. The experimental serVICe is a proving ground for new or proposed services. When sufficient information has been secured from. experi mental operation, the Commission formulates rules and policies nec . essary to place the service on a regular basis. WARTIME DEVELOPMENTS During the war substantially all developments were directed toward meeting the needs of the military and, as a result, practically no equip ment was developed for commercial use. Commercial and military needs differ widely althongh-FEDERAL IJOMMUNICATIONS COMMISSION 47 MICROWAVE RELAY Microwave transmissions showed great expansion during the past year. As new tubes and circuits .are developed it is expected that a still greater increase in experimentation and application will ensue. In particular, the microwave frequencies provide an economical means of transmitting wide bands of frequencies over great distances by means of intermediate repeater stations. It will be possible to trans mit high quality FM and television programs for rebroadcast by local outlets. In addition to transmitting commercial radio programs, these microwave stations can be used to carry many telephone, telegraph, and special news transmissions now carried by wire lines. One of the factors weighing heavHy in favor of the microwave circuits is their ability to transmit much wider bands of frequencies than can be ac commodated by existing wire facilities. Many applications evince interest in microwave circuits. Among these are the existing communications common carriers, television sta tions and networks, the aviation, railroad, and petroleum-pipeline in dustries, and law enforcementa~encies.Each group proposes differ ent methods of using the avaJlable frequenCIes. The request for assignment in the microwave bands has already indicated that this pOl'. tion of the radio spectrum wj]] be crowded. In addition to persons proposing to install microwave relay systems, various applicants look to operatmg facilities on a common carrier basis in competition with existing communications common carriers. The rapid expansion of microwave systems raises many questions of policy which must be resolved before the service can be established on a regular basis. Studies are being made to determine the practicabil ity of replacing all heavily loaded long distance wjre and telegraph lines with microwave relay stations. Sufficient information on costs of installation of microwave relay chains versus the comparative costs for the maintenance and replacement of wire and cable lines is not yet available. GENERAL MOBILE SERVICE Need for a communication service for trucks and busses in urban areas and along the nation's major highways has existed for many years. The Commission has allocated frequencies in the 30-44 mega cycle band for the highway stations and frequencies in the 152-162 megacycle band for the urban stations in this potential servjce. At the same time it indicated that rural radiotelephone service and the short distance toll telephone service would also secure frequencies in the 152-162 megacycle band. Sjnce the general mobile service js stHl in the experimental stage, no determination of policy has been made as to the final form it will take. Usingassi~nedfrequencies, the telephone companies are testing serv ice in urban areas and along highways. They propose service to individuals and groups on a common carrier basis·at published charges. In addition to authorizations issued to numerous telephone companies for installations in a large number of cities to provide urban mobile service, grants have been made for service on highways between major cities. 48 REPORT OF THE FEDERAL COMMUNICATIONSC6MMrssION In a similar manner, individuals and organizations contemplate furnishing radio service to their own mobile units. The associations generally comprise groups haviug similar service requirements. For example, the National Bus Communications, Inc., requested that fre quencies assigned for intercity passenger bus use in the 30--44 mega cycle band in the general mobile (highway) service be made available for the intercity passenger bus industry directly or through its com munication organization formed for that purpose. The Commission held a hearing in this matter on June 6, 1946, but had not issued a de rision by the end of the fiscal year. Intercity truck organizations have indicated that they need an industry system patterneTaph first- or secohd-class license may not act as chief or sole operator on a cargo vessel until he has had at least 6 months of satisfactory service as a qualified ship radiotelegraph operator. The Commission, through Order 83 and subsequent extensions including Order 83-H, suspended this requirement until December 31, 1945. However, a survey of the availability of radiotelegraph operators in (licated that this suspension waS no longer necessary and,eff~ctiveJ an uary 1, 1946, radiotelegraph operators aetinp; as chief or sole operators must comply with the provisions of section 353 (b) of the act. Unavailability of first-class commercial radiot.elephone operators invit.ed Commission Order 91-C of January 19, 1943, which permit.ted broadcast stations under certain conditions to employ commercial radio operators of any class. When radiot.elephone first-class opera tors again became available, the Commission on April 26, 1946, promul gated Order 91-D, which canceled Order 91-C, effect.ive August 1, 1946. The Commission's rulesreq~irecommercial and amateur radio op eratol's .to show actual operation of licensed radio stat.ions before li 53 54 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION censes can be renewed. Becnuse of the difficulties in meeting this re quirement during the war, the Commission, through its Order 77' dated December 7, 1940, suspended this provision. Further extensions were given, the last of which was to expire on December 31, 1946. Radio operators are required to file applications for renewal of li censes prior to expiration date. Because many licensed radio opera tors ",ere either in the military service or engaged in war activities, considerable difficulty was experienced in determining the expiration date of their licenses. Accordingly, the Commission on .January 2, 1945, adopted Order 124 which provided for the renewal of commercial radio operator licenses other than temporary emergency radiotele-. graph second-class licenses upon filing a proper application with the Commissionp~iorto December 31, 1945, aud within a period of 1 year from the date oj' expiration. Subsequently, the Commission Oider 128 extended these provisions to cover the renewal of numerous expired commercial radio operator licenses held by persons serving or who have served in the armed forces or the merchant marine or have been em ployed outside of the United States. This order, dated August 28, 1945, permitted such licensees to obtain renewals of their expired li censes provided the latter were nLlid on December 7, 1941, and tlmt application for renewal was filed on or before June 30, 1946; later·ex tended to December 31, 1946, by Order 128-A of June 20, 1946. To obviate conducting examinations and issuing licenses to approx imately 500,000 railroad employees in connection with the new 'rail road radio service, the Commission, by Order 126 of August 21, 1945, waived the commercial radio operator requirements for the operation of railroad radio stations. However, commercial radio operator li censes were still required for adjustments to railroad transmitting apparatus which might affect its proper operation. After studying operator requirements for all classes of radio sta tions, it was dccIded that in view of the relatively low-power and im proved stability characteristics of present radio equipment used in the portable and mobile units in the experimental, emergency, mis cellaneous, and railroad services, it would be possible to dispense with the need for licensed operators in portable and mobile stations without detrimental effect on these ser"ices. So, on May 10, 1946, Commission Order 133 dispensed with requirements for commercial radio operator licenses for the operation of such stations. Commission Order 75-D of January 23, 1946, eliminated the re quirement of proof of citizenship as a prerequisite to issuance of a commercial radio operator's license as originally required by Order 75. During the fiscal year the CommiSSIOn conducted an extensive survey to'determine the possible further simplification of its com· mercial rlldio operator requirements, the results of which are being analyzed with a view to possible revision of its rules and regulations. At the close of the fiscal year, the six categories of commercial radio operators represented approximately 314,000 outstanding licenses and permits, broken down as follows: Radiotelephone licenses first and second class) 41, 434 Restricted radiotelephone permits__' 248.465 Radiotelegraph licenses (first and second class) and re- stricted radiotelegrap.h permits, but not including special wartime authorizations :.__________________ 2oi-.476 Total 314.375 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION 55 2. AMATEUR RADIO SERVICE Operation of .amateur radio stations suspended as a wartime meas ure, was resmned .as quickly as the military released frequencies bor rowed from the amateurs during the emergency. The first band to be restored was 112 to115.5 megacycles, reactivated for amateur use by Commission Order 127 of August 21, 1945. It was made a.vail able to all amateur stations whose licenses were valid at any time during the period of December 7, 1941, to September 15, 1942: Other frequencies were returned by Commission Orders 130 to 13o-G inclusive. Order 130-H, which became effective July 1, 1946, made the following frequency bands available for amateur use :3500 to 4000 kc., 7150 to 7300 kc., 14100 to 14300 kc., 27.185 to 27.455 mc., 28.0 to 29.7 mc., 50.0 to 54.0 mc., 144 to 148 mc., 235 to 240 mc., 420 to 430 mc., 1215 to 1295 mc., 2300 to 2450 mc., 5250 to 5650 mc., 10,000 to 10,500 mc., 21,000 to 22,000 mc., and a.ny frequencies a.bove 30,000 megacycles. . Order 130, approved November 9, 1945, extended the validity of amateur station licenses affected by Order 127 for an additional period ending May 15, 1946 and added six additional frequency bands. This order also canceled Order 72 of June 5, 1940, prohibit ing amateur radio stations from communicating with operators of foreign radio stations; Order 73 dated June 7, 1940, and amendments, prohibiting operation of amateur portable and mobile stations on .frequencies below 56 megacycles; Order 87-A, dated January 9, 1942, which prohibited all amateur operation, and Order 87-B dated Sep tember 15, 1942, suspending the issuance of renewed or modified ama- teur station licenses. ' Order 130-F, adopted April 17, 1946, provided that the term of each amateur station license, which was valid between December 7, 1941, and September 15, 1942, should run concurrently with the term of the amateur operator license held by the licensee of the station. Amateur licensees have lonp; been required to file with the Com mission an application for modification of license to change the per maneIlt location of a station. Due to thc transitory conditions brought about by the war, many amateurs were at locations other than that specified in the station licenses at the time the Commission re activated the amateur radio service. This resulted in thefilin~of a large number of applications which, because of its limited staff, the Commission was unable to process. For administrative expediency, the Commission on April 10, 1946, adopted Order 132 which author jzed amateur station licensees (whose station license terms were ex tended by Order 130-F and earlier orders) to operate at locations other than those specified on the license, provided advance written notice was given to the FCC engilleer in charge of the district for which the station license was issued and to the engineer in charge of the district in which operation was intended. Because many amateurs were either in the military service or en gaged in war activiti transmitter. Some differences in occurrences were noted for different recorder locations at comparable distances from the transm.itter, which may be due to differences in reflection at various latitndes. This is not definitely known, however, as there are other possible explanations for the effect. BURST PHENOMENA As already reported, "bUl'st" signals continue to appear on record ings made of distance stations for the purpose of detecting sporadic E and tropospheric effects. The rates and intensities of the occur rences of bursts are not being analyzed at present because of their purely.academic interest and lack of bearing upon FM and television allocations. However, they have amused considerable interest in scientific circles and many requests have been received for past or fn ture analyses. Conelation between audible bursts and visible meteors is still being undertaken, but no coincidences in addition to the 13 pre viously reported have been observed. 2. LABORATORY DIVISION The Laboratory Division was organized in March 1946 to study civilian uses of radar and other war-born developmeuts as they affect freq,uency allocations, to study wave propagation, to develop new mon itormg equipment aud to test all types of radio a,Pparatus, including diathermy and industrial heating equipment reqUIring type approval. During its 4 months of operation this division tested 15 models of diathermy machines, conductcd 7 field intensity surveys on high powered industrial RF heater installations for the purpose of estab lishing effectiveness of shieldin¥ to prevent interfering radiations, made 4 field intensity surveys ot experimental FM stations to deter mine the limits, of the good service area, and made 2 type-approval tests on modulation momtors. Extensive studies on the interference possibilities of diathermy and industrial heating equipment resnlted in standards being recom mended. Three radar sets received from the armed services are being tested to determine their utility for civilian use and the possibility of interference to other services. At the end of the fiscal year 16 projects required laboratory stndy and development. They include study of image response and blanket ing in typical FM receivers, study of the suitability of 21 and 26 mega cycles for transmitting time signals, study to determine the feasibilIty of "stratovision" broadcasting and broadcast relaying, propagation end equipment study of the limitations applying to the citizens' radio service looking towards the establishment of rules and 'standards for this service, development of equipment for the field intensity re- 60 REPORT OF THE FEDERAL COMMUNICATIONS COMMISSION cording at Southampton, Pa., determination of the errors for indio eating instruments used at very high frequencies, study of the band width occupancy in the radio spectrum of loran signals, determina tion of the accuracy of a type of portable heterodyne frequency meter considered for purchase by the Commission, and measuring charac teristics of radar type antennas to determine their suitability for field intensity measurement purposes. APPENDIX PUBLICATIONS Followin,g is a list of Federal Communications Commission publi cations whICh may be purchased from the Superintendent of Docu ments, Government Printing Office, Washington 25, D. C., unless otherwise indicated: ' TWa Price CommUDIcatioDs Act of 1934 with amendments and index, revised to June 14, 1945 $0.15 It''eaeral Communications Commissionr~ports(bound volumes of decisions and orders exclusive of annual reports) : Volume2~July100ihJlJne 1006___________________________________ 2. ()() Volume &--July 1936-ll'ebruary 1937________________________________ 2. ()() Volume 4-March 1937-November 15. 1937__________________________ 1.50 Volume 5-November 16,1937-June 30. 1938~______1.50 Volume i>-July l,193B-February 28,1939___________________________ 1.50 Volume 7-March 1. 1939-February 29, 1940_________________________ 1.50 Volume 8-March I, 194