Federal Communications Commission 30th Anniversary Report For the Fiscal Year 1964 Summarizing three decades of electronic communication developments and current happenings in that fleld UNITED STATES GOVERNMENT PRINTING OFFICE. WASHINGTON. 1964 FCII tol. by the Superintendent of Documen,., U.S. Govemment Printing otIIce WashinSlort, D.C. 2.0402 - Price SO tenl'; pap... to'ller COMMISSIONERS Members of the Federal Communications Commission (As of June 30, 1964) E. WILLIAM HENRY, Ohairman (Term expires June 30, 1969) ROSEL H. HYDE (Term expires June 30, 1966) ROBERT T. BARTLEY (Term expires June 30, 1965) ROBERT E. LEE (Term expires June 30, 1967) FREDERICK 1V. FORD (Term expires June 30, 1971) KENNETH A. Cox (Term expires Jnne 30, 1970) LEE LOEVINGEB (Term expires June 30, 1968) A Ust atpres~tand past Commissioners appears on page IV. D LmER OF TRANSMITTAL FEDERALCO~Il\.fUNICATIOXSCOUMISSION, TVashington, D.O., 130554 To the Oongress of the United State8: The Federal Communications Commission herewith transmits its 30th Annual Report for t,he fiscal year 1964. The report coutains information required by section 4 (k) of the Communications Act of 1934, as amended, and 2 (b) of section 315; also section 404 (c) of the Communications Satellite Act of 1962 con cerning certain Commission activities in the field of satellite com munication. Marking the 30th anuiversary of the Commission, the report higll lights the advances made by the communications industry since 1934. Its current review notes, in particular, the newall-channel television set requirement and other furtherance of UHF development; general broadcast matters, including Commission efforts to make licensees more conscious of their obligations to the public; steps taken to deal with the accelerated growth of land mobile and other nonbroadcast radio services; continuing telephone and telegraph regulatory prob lems, which now extend to expanding ocean cable facilities; streugth ening the Emergency Broadcast System and other national defense functions delegated to the Commission by an Executive order of 1963 ; and collection of additional revenue for the Government from fees es tablished in 1964, pursuant to Federal directive, for filing applica tions with the Commission. Respectfully, E. WILLIAM HENRY, Ohairman. ill PAST AND PRESENT COMMISSIONERS Comml8alont'r. -Eugene O. Sykes_. •~._ Chairman. ._. _ -Thad H. Brown. _ Paul A. Walker • •• ._. . __ Acting Chairman _ Chairman • • __ ••__ •••_.'._. "Norman S. Case.• ••• _ Irvin Stewart_..__ • "." • ••_ :~r::~~egz:~~~~.,.."~=~~-:==~====== === ===== •Annlng S. PralL. _ Chairman __ • A. _. _ T. A. M. Craven•• _ -Frank R. McNinch. • _ Chairman , _ -Frederick I. Thompsoo •• Jam(fh~k=~_~~::::::::::::::::::::::::::::: -Ray C, Wakefield _ Clifford J. Dorr_. • _ Ewell K, Jett__ • • __ • _ Interim Chairman _ Panl A. Porter_. ••__ • •••__ Chairman • _ Oharles R. Denny • _ Acting Chairman. •__ • ._• _ Chairman ••• • _ -William H. WllIs • • ._._._••_ Rosel H. Hyde _ Chairman__ •• _ Acting Chairman • • • _ Edward M. Webster •• _ Robert F. Jones • •• _ -Wayne Coy • • _ Chairman. •• _ -~~:::~:~:k::::::::::::::::::::::::::::: ~~~1i.~fi:::::::::::::::::::::::::::::: John C. Doerfer • _ Cbalrman • • • Robert E. Lee. • _ George C. McOoDDaugbey _ Chairman _ -Richard A. Mack _ T. A. M. CraveD • •__ •• Frederick W. Ford • Chairman. __ •__ • • _ 10bD S, Cross. • 2~:::;~.~~::::::::::::::::::::::::::::: Cbalnnan • • _ ~,~~::~~:::::::::::::::::::::::::::::: Kermeth A. Cox • _ Lee Loevlnger • _ -Deceased. IV PoIUfClt SlaU Dem_______ M1s.s _ Rep_::~::::Ohio::::::: DenL______ Okla _ Rep:::::::: ire::::::: Dem_______ Tex. _ Rep__ •__ • __ N.Y _ Dem Tex. _ Dem. N.Y _ Dem::::::: D:if :::::: Dem. N.C ._. Dem::::::: Ala:::::::: Dem_______ Tex _ Rep:::::::: cam::::::: Dem • Ala _ Ind________ Md _ DeDi::::::: KY·_:::::::: Dern::::::: D:C'- :::::: Rep:::::::: vi::::::::: Rep Idabo _ in"{C::::::: 0:0'_-_:::::: Rep._______ Ohlo _ Dem_______ Ind_. _ R;p::::::::~ialile::::: Dem_______ N.V •__ Dem_______ Tex, _ Dem_______ Utah _ Rep________ Wis _ Rep-_::::::: iie_:::::::: Rep________ Ohlo _ Dem::::::: pia.- :::::: Dem_______ Va. _ Rep •__ W, Va _ Dem::::::: Ark:::::::: Rep Mlcb _ Dem_______ I1L _ oem::::::: Teiiii ::::: vem::::::: Wish:::::: Dem.______ Minn _ Terms of serriu July 1I,1934---Apr. 5,1939 July ll,I934-Mar. 8,1935 July 1I,1934-June 30,1940 July lI,I934---June 30,1953 Nov. 3,1947-Dec. 28,1947 Feb. 28,1962-Apr. 17,1953 July 1I,1934-June 30,1945 July 1I,1934-June 30,1937 July 1I,1934-June 30,1943 July 1I,1934-Jao, 1,1936 Jao. 17,1936--July 23,1937 Mar. 9,1935-July 23,1937 Aug. 25,1937-Juoe 30,1944 Oct. 1,1937-Aug. 31.1939 Oct. 1,1937-Aug, 31,1939 Apr. 13,1939-June 30,1941 Sept. 1,1939-Nov. 13,1944 Sept, 1,1939-Nov. 13,1944 Mar. 22,1941-June 30,1947 Nov. 1,1941-June 30,1948 Feb. 15,1944.----Dec. 31,19-17 Nov. 16, 1944-Dec. 20,1944 Dec, 21,I944-Feb, 25,1946 Dee. 21,1944---Feb. 25, 1946 Mar. 30,1945-0ct, 31,1947 Feb. 26,I946--Dec. 3,1946 Dec. 4,1946-0ct. 31, 1947 July 23,I945-Mar. 6,1946 Apr. 17,1946- Apr, 18, lIJ63--Apr, 18, 19M Apr, 19,1954---0ct. 3,19M Apr, 10,1947--June 30,1956 Sept. 5,1941-8ept. 19,1952 Dee. 29,1947-Feb. 21.1952 Dec, 29,1947-Feb, 21, Hl52 Jan. 2, 1948-8ept. 30,1954 July 6,1948-June 30,1956 Mar. 6,1952- Oct. 14,1952-Apr. 14,19053 AJ)1'. 15,1953-Mar, 10,1960 July 1,1957-Mar. 10,1960 Oct. 6, 1953- Oct. 4,l9M-June 30,1957 Oet. 4,19M-June 30,1957 July 7,1955-Mar. 3,1958 July 2,1956-Mar. 25,1963 Aug. 29, 1951- Mar. 15, 1960-Mar, 2,1961 May 23, 19.;s...8ept. 30,1962 July 19, 1960-Mar. 2,1001 Mar. 2,19tH-June 1,1963 Mar. 2,1961-June 1,1963 Oct. 2, 1962- June 2,19l\3-- Mar, 26,1963- June 11,1963- Table of Contents POlO REPC>RTSU~~J\RY______________________________________1 30TH J\NNIVERSJ\RY C>F FCC___________________________ 11 CC>~~ISSIC>N_______ _______ ___ _ __ 21 Organizationchart~• •~______ 20 COnlntissioners________________________________________________ 21 Commission staff__~.__ _____ __ ____ ___ 21 Personnel_____________________________________________________ 21 Employee awards program. • __ .___ 22 Appropriations and expenditures. • • ••_ 22 Electronic data-processing system • . __ 23 Application filing fees. • • __ 23 Hearing examiners. • __ __ __ ______ 23 ~vie1VBoard~~_____________24 lJockets______________________________________________________ 24 Authorizations • __ __ __ __ _______ _ 27 Applications~_____________27 Correspondence~_27 Releases and publications~__ __ _______ _____ 28 Technical assistance to foreigners________________________________ 28 Alien radio operatioD___________ ____ __ _________ ______________ 28 LAW ANDENFC>RCE~ENT______________________________30 LegislatioD_____ ____ __ ___ __ _______________ ___ ____ _______ __ _____ 30 Legislation enacted .__ _____ _____ 30 FCC legislative program_____ ____ __ __ __ ___ __ __ __ __ ______ 30 Other bills affecting the FCC________________________________ 31 Congressional hearings •~~31 LitigatioD_ __ _ ___ _____ __ _ ___ ____ _ _____ _____ 32 Court of appeals decisions of special significanae_______________ 32 Staystics_________________________________________________ 35 Enforcernent__________________________________________________ 36 NJ\T1C>NJ\L DEFENSE___ _________________ _____________ ___ 37 GeneraJ_______________________________________________________ 37 Emergency Broadcast System__ _________ ___ _________ __ __________ 38 National defense emergency authorizations________________________ 39 Fanout protection for AM and FM statioDS_______________________ 39 FCC Industry Advisory Committees_____________________________ 39 Other emergency planning cooperatioD ,.-_____________ 40 FCC Executive Reserve unit____________________________________ 40 v VI TABLE OF CONTENTS Page SPACE COMMUNICATION____ __ ________ _____________ 41 General_____ _________ _______ _____ ___ __________________________ 41 Communications Satellite Corporation_____ _____________ __________ 42 Initial stock issue • ._. 42 Commission activity ________ ______ _____________________ __ 43 Financing of the Corporation________________________________ 43 Allocation of stock among authorized carriers___ __ _________ __ __ 44 Safeguards against stock speculation__________________________ 45 Procurement policies and practice .___________________ 45 IIEarly Bird" system. ._ ________________ __________ __ 46 International developments. ___________________________ _______ __ 47 Space frequency allocation considerations___ __________________ 47 Arrangements for foreign participation________________________ 48 Worldwide communication traffic statistics____________________ 48 Technical developmeIits~~~___________________________ _______ _ 49 Experimental programs_____ ___ ___________ ____________ _____ _ 49 Relations with other agencies________________________________ 50 BROADCAST SERVICES_____ __ ____ __ __ 51 EnforcemenL_ _____ _______________________________________ ____ 51 Complaints and other public comment____________________________ 51 Compliance______ __ __ _ _ __ __ ___ 51 Sanctions___ ______ __ __________________________________________ 52 Revocation proceedings______ _______________________________ 52 License renewal proceedings~______________________53 Forfeiture proceedings_____ _________________________ ________ 54 Short-term licenses______ ________________________ ___________ 55 Political broadcasts__ __ __ ___ __ __ __ ___ __ __ __ __ 56 Broadcast of controversial public issues~___58 TV network programing inquiry_________________________________ 60 Multiple ownership___ ______________________________________ 61 Widely held licensee corporations________________________________ 61 Revision of program reporting form~_____62 Broadcast advertising_ _________________________________________ 63 Excessive advertising______ _ __ _____ __ __ _ 6:, Loud commercials________ ______ __________________ __________ 64 Combination advertising rates_______________________________ 64 Double billing____ ________ ________________ _________________ 65 Sponsorship identification__ _________________________ _____ 65 "Payola" and "Plugola" inquiry_____________________________ fi5 Broadcast station sales__ '_ __ ____________________________________ fi5 Broadcast of horseracing information_____________________________ 66 License renewals______ __ __ _ __ __ __ __ __ 66 Emergency operation~__________ _________________________ ____ 67 Call letter assignment procedure~________________________67 Television (TV) broadcast service~_~_______________67 All-channel TV receivers ,___ __ __ ___ __ 67 Advisory committee on UHF-______________________________ 68 Revision of UHF assignments ,_';' ____________________ 68 SUbscription TV_______ __ __ ___ 69 CATV____ __ __ __ _ _ 70 Inquiry into joint CATV-TV station ownerahip_______________ 71 Further relaxation of technical requirements_ _________________ 72 TABLE OF CONTENTS BROADCAST SERVICES-Continued VII Television (TV) broadcast service-Continued Pale Option time_ ______ _____ _____ _____ __ __ __ _______________ 72 CBS-TV affiliates compensationplan~________________________72 Radio astronomy use of Channe137_________________________ 72 Educational TV __ __ __ __ __ __ _ __ __ 73 Instructional TV fixed scrvicc___________________________ 73 Airborne TVoperation_________________________________ 73 Frequency modulation (FM) broadcast service______ _ 74 FM "freeze" lifted_________________________________________ 74 FM subsidiary services_____________________________________ 75 Educational Fl\L_______________ __ _______ __ _____ 75 Standard (AM) broadcast service________________________________ 75 AM "freeze" lifted ·_______________ 75 Use of the 25 Class I-A clear channels "- 76 International broadcast statiollS__ _______________________________ 77 Miscellaneous broadcast services :.. '__ _ 77 Statistics_ ___________ _____ _____ ______ _________________________ 77 Current broadcast authorizatious_ ____ _______________________ 77 Status of broadcast authorizations___________________________ 78 Broadcasting since 1949 '- '-__ 78 Broadcast applicatious .. "- __ 80 Broadcast industry financial data____________________________ 82 SAFETY AND SPECIAL RADIO SERVICES____________________ 88 General______________________________________________________ 88 Regulatory developments____ ______ ________ _____________________ 88 Frequency relief for land mobile services_____ ____________ __ 88 Channel splitting_ __ __ ___ __ __ __ ___ 89 CATV relay _____ __ __ __ 89 Fee effect on applications___________________________________ 89 Enforcement_____ ___ ______ __ __ __ _ __ __ 90 Marine radio scrvices_ __ _____ ___ __ __ __ ___ ___ 90 Safety at sea______________________________________________ 90 Safety of Life at Sea Convention________________________ 90 Proposed legislation_______ __ ___ __ __ ___ __ 90 General exemption of certain vesscls ,_,. __ 91 Individual exemptions from compulsory radio requirements_ 91 Exemption of public coast stations from listening watch_ ___ 91 Distress studies_ _____ __________ ______ _________________ 91 Bridge-to-bridge communication study___________________ 92 Radio Technical Commission for Marine Services (RTCM)_____ 92 Marine radio communication systems ... 92 Rule amendments .------------- _____ 92 Proposed rule changes______ __ __ _______ 92 Additional coast station facilities established_ __ _____ 93 Authorizations of special interest_ _______________________ 93 Closure of station_____ ____ ______ 03 Radio communication in Alaska__________________ 93 Aviation radio services____________________________________ 93 General__________________________________________________ 93 Radio Technical Commission for Aeronautics (RTCA)_________ 94 International aviation___ ________ __________________ _________ 94 New developments and rule changes_________________________ 95 TABLE OF CONTENTS :V1II SAFETY AND SPECIAL RADIO SERVICES-Continued PaP Public safety radio services__~~___ __ __ ___ 95 General_ __ _ __ __ __ __ __ _______________________ 95 New developments and rule changes_ ___ __ ____ __ __ __ __ 95 Disaster communications service________ _________________________ 96 Land transportation radio services__ ________________________ __ 96 General~__________________________________96 New developments and rule changes_ _ _____ ___ 96 Industrial radio services__ __ ___ __ ___________________________ 97 General__________________________________________________ 97 New developments and rule changes_ ___ ______ _______________ 97 Citizens radio service_ ____ _____ __ __ ___________________ ______ 97 General__________________________________________________ 97 New developments and rule changes_ _ ___ _____ __ __ 98 Amateur radio servioo .___ __ _______________________ ___ 98 General .____________________________________________ 98 New developments and rule changes_ ___ _____________________ 98 Statistics •~___ 99 Stations in safety and special. radio services • • ___ 99 Transmitters in safety and special radio,services_______________ 100 Applications in safety and specialradio~vices~__ 101 Enforcement sanctions in safety and special radio servioes_~.___102 COMMON CARRIER SERVICES________________________________ 103 Domestie telephone___ _ __ ______________________________ 103 Highlights_ __ __ __ __ __ ____________________________ 103 Telephone services and facilities_ ____________________________ 104 Tariff docket case8 .__ __ __ ____ __ __ __ _________ __ 107 Telpak_______________________________________________ 107 WATS__ __ __ __ ____________________ _____ __ _____ __ __ 107 WAI>S_______________________________________________ 107 TW]{________________________________________________ 107 ~vateline___________________________________________108 Thornell BarnesCO_~__________________________________lOS Special construction eharges_ ___________________________ 108 FTessrates .__________________________________ 108 ~e.. tariff._______________________________________________ 108 Private-line tariffs__ __ __ ___ __ __ __ ______________ _____ 108 Special construction cbarges_ ____ ______ ______________ ___ 108 United States-Japan cable tariffs_ ______ _________________ 109 Tariffre~ions.__________________________________ 109 Ilepreciation_.____________________________________________ 109 Other subjects • • ___ 109 Investment tax credits_ __ _____________________ _ __ 109 Charitable eontributioDB_ _____ _____ _________________ 110 Original cost accounting____ _________________________ 110 Telephone set losse8 ,____ __ __ 110 Relief and pensiollS_ __ _____ __________________ _______ 110 Miscellaneous accounting matters. • ___ 111 'i':rnLl!: oF' CONTENTs IX COMMON CARRIERSERVICES-ConlinJ~di-ii.~ Domestic telegraph "_____ ________________ __ ___________ __ __ III BigWights~__.__ III Telegraph services and facilities~____ 112 Modernization andexpansion~~___ _ 112 Expanding services_ ____ ________________________ _____ __ 113 Extension of lines and curtailment of service " 114 Speed of service • w_ _ _ __ 114 Domestic telegraph rates and tariffs_ __ ___________________ ___ 115 1'1essage servioo_ ___ __ ____ ___ _________ ____ ______ _____ __ 115 Public Telex service~__115 Tel(T)ex service • ____ _________ __ 115 Tariff scheduIes_ ___ __ __ ___ __ ___ _____ _____ _____ 115 Other regulatory matterB___ __ _ __ _ _______ __ __ _____ 115 Investigation of domestic telegraph service • 116 Domestic common carrier radio facilitieB_________________________ 117 Domestic public land mobile radio service_ ____________ _______ 117 Common carrier microwave radio services____________________ 117 Domestic common carrier application fOTID_ __ 119 International telegraph and telephone___ __ __ ___________ __ _____ 119 General__________________________________________________ 119 Financial position of industry_______________________________ 119 Western Union cable divestment____________________________ 120 Reorganization of American Cable & Radio COrp______________ 120 International rate study~___ ___ ____ __ __ ___________ 120 Overseas leased channel cases_______________________________ 120 Ocean telephone cables__ ____ ___ __ __ _____ ______ _____ __ __ _ 121 Use of telephone facilities by telegraph carriera__ _____ _ __ 121 Use of high-frequency bands________________________________ 122 International radio circuits_ ___ __ ____ ___ __ ____ _____ __ _ 122 Rates for international services___ _____ ___ __ __ ____ ________ ___ 122 Pan American complaint_ ___ ________________ __ _____ ________ 123 ])e~eciation-------------------------------------------___123 Tariff schedules_ _____ ____ ___ ___ __ __ _________ __ _______ __ 123 Other regulatory matte.r8__ __________ ______________ __ _____ __ 123 Statffitics_____________________________________________________ 123 ~neral__________________________________________________123 Telephone carriers_ __ ___ ______ ____ ____ ______________ ___ __ __ 124 Domestic telegraph carrier __ __ ________________________ ___ 125 International telegraph carriers____ ______________ _______ __ 126 Overseas telegraph and telephone traffic_ _________________ 126 Common ca.rrier radio &uthorizatioD8____ ____ _________________ 130 Common carrier applicatious___ _______ ___ ___________________ 131 FIELD ENGINEERING_ ________________________ __________ _ 132 Gensrsl______________________________________________________ 132 Field office enforcemenL __ ______ _____ _____ __ __ ___________ 132 Broadcast service___ ____ _____ _______ ________ __ ___ _________ _ 133 Business and industry ______________ ________________________ _ 133 x TABLE OF CONTENTS FIELD ENGINEERING-Continued Pa•• ~arine_______________________________________________________134 Radio operator licensing____ __ _____________________________ _____ 134 Administration of operator requirements__________________________ 134 Interference investigatioD_____ ______________ ____________________ 135 Certification of ISM equipment_ _ _ __ __ __ ___ 136 Unlicensed stationB_ ___________________________________________ 137 ~onitoring-_-_------------------------------------------_____137 Monitoring facilities_ _ __ __ _ __ __ ___ _ 138 Direction finders_ __ __ __ ___ __ ____ __ 139 Network intercommunication~___ ______________ 139 International radio interference~~________ 139 Tropical field strength recording_____________________________ 140 Search and rescue_ __ __ _______ __ __ __ _ 140 Enforcement of class D citizens rules by monitoring____________ 140 Contractual services for Federal agencies_ _____________ _______ 141 Technical enforcement facilities_ ____ __ __ __ __ __ _ 141 Engineering measurements cars_ _ __________________ _____ 141 Investigative facilities___ _______ _______________ _____________ 142 FM-TVenforcement units__________________________________ 142 Upper spectrum engineering measurements units______________ 142 Antennas_____________________________________________________ 143 Recruitment and training of engineering personneL_ _______________ 143 Civil defense and radiological monitoring__ _______________________ 143 Field engineering offices and monitoring stations__ __ __________ _____ 144 Statistics_________ _ __ _ __ _______ 144 Inspection statistics____________ _ __ ____ ____ __ 145 Investigative statistics , ______ _____ 145 Monitoring statistics__ __ _____ ______________________________ 146 Commercial radio operator licenses__________________________ 146 Applications processed by Antenna Survey Branch_____________ 147 Applications referred to Federal Aviation Agency for special aeronautical study__________ __ __ _ _______ 147 RESEARCH AND LABORATORY :_ 148 ~arch_____________________________________________________148 Ionospheric propagation~__________ _____________ 148 VHF and UHF propagation_ _______________________________ 149 Research reports_ _ __ ___ __ ___ __ 149 Experimental radio services______________ _ __ _ _____ ___ 149 Proposed ban on electronic eavesdropping_ ____________ ___________ 150 Nonlicensed radio frequency devices______________________________ 151 All-channel TV receivers_ __ ___ __ ____ _ __ _____ __ 152 Technical standards studics~__ 152 Type acceptance~___ __ _____ __ 153 Laboratory___________________________________________________ 153 Research and development_________________________________ 153 Assistance to other Commission programs_ __ _________________ 154 Calibration of measuring equipment~___ ___ __ __ 155 Type approvaL~___ __ ___ _ __ 155 Tests of restricted radiation devices___ _______________________ 155 Spectrum occupancy and automated monitoring_______________ 155 TABLE OF CONTENTS Xl Pag. FREQUENCY ALLOCATION AND USE~___________157 General_ _ __ __ ___ ______ ________ __ __ 157 NatioD1l.1 frequency allocations_ ___ ___ __ __ _______ __________ 157 Natiolli\l frequency coordinatioD~__ _~__ 158- National non-Government frequency lists~_ ISS International frequency allocations_ ___________________________ 159 Radio astronomy ______ __________ ______ __ ____ _ 159 Ocean data service_____________ 159 "P.nel of experts" . ____ __ ________ 160 International frequency registratioll~_.~_______ 160 International frequency coordinatioll____ __ _______ ____ __ __ ___ _____ 160 International interference and infractionB________ _ .___________ 161 International frequency usage data~_______________________ 1()2 Internation.1 conferences___ __ _____ ___ __ ______________ 162 Call sigos____ _____ _________ ___ ____ __ _______________ l63 APPENDIX_ ______ __ __ ___________________________________ 164 FCC log highlights of 1964 fiscal yeaL___________________________ 164 Report Summary 1964 YS. 1934 With radio communication via satellite undergoing practical test and earthbound radio bursting its spectrum seams, the regulatory burdens of the Federal Communications Commission have reached unprecedented proportions. The FCC's 30th year saw nearly 1.5 million radio stations under its jurisdiction which, by a coincidence, is almost 30 times the number it started with. Also, there are nearly 2.9 million radio operator authorizations (commercial and amateur), or about 45 times as many as in 1934. Today some 65 different types of radio services aid businesses and individuals, expedite movement of vehicles on land, further naviga tion on water and in the air, and contribute to the protection of life and property. In the international field, ocean telephone cables are multiplying and the era of satellite relay of telephone and telegraph communication is more imminent. Under new and expanded national defense responsibilities, the FCC must coordinate all these commu nication facilities with the preparedness program. In three decades the number of applications received by the Com mission has multipled 100 times-from less than 10,000 in 1934 to dmost 1 million in 1964. This does not include tariffs, pleadings, and other filings. Further, electronic usage has reached a point where the Commis sion, besides having to curb interference between 5 million fixed, port able, and mobile transmitters, must also control the emissions of countless devices which, though not used for communication purposes, can, and do, interfere with authorized radio reception. The need for this is illustrated, in particular, by the constant threat of disrupting services on which safety of life and property depend. SPACE COMMUNICATION Satellite communication is one of the most spectacular electronic developments of all time. Besides lifting the horizon for long-distance telephone and telegraph traffic it has a particular glamor for thepublic because of its intercontineut live TV relay possibilities. 1 2 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT United States initiation of a global satellite c,ommunication system neared reality under joint effort of the Government agencies con cerned. International agreement was reached on the radio frequencill3 25 2 Joint and general matters_______________._.__ 34 14 7 Total other than broadcast dockets________ 177 219 20 Petitions, cease and desist orders, rules, etc______ 39 35 16 Total dockets____ --- -- -----------.-..._--- 56' 4" 49 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 27 AUTHORIZATIONS More than 4.3 million radio authorizations of all kinds were out standing at the close of the year. A corrootwn in computing the fig ures for commercial radio operators necessitated change in that total appearing in the 1963 annual report. Yearend figures for fiscal 1964 in comparison with corrected figures for 1963 follow: Broadcast services. . _ Safety and special radio service3•••• . _ -Common carrier servioos___________ _ _ ExperimentaL _ -Commercial radio operators . _ Amateur radio operators__ . . _ TotaL. ..._~_ June 30,1963 June 30, 1964 Increase or (decrease) 15,829 17,231 1,402 1,131,910 1,418,826 286,916 6,599 8,343 1,744 730 698 (32) 2,446,939 2,613,875 166,936 247,603 256,237 8,634 3,849,610 4,315,210 465,600 Because some radio stations use numerous transmitters, their col lective authorizatipns represent the use of more than 5 million fixed, mobile, and portable transmitters. APPLICATIONS Nearly 1 million applications of all kinds (but excluding petitions and tariff filings) were received during fiscal 1964. This was nearly 122,000 more than the previous year. Comparative figures are: Cl"" June 30, June 30, 1963 1064 14,619 15,727 489,224 582,511 8,040 9,583 1,510 1,559 325,923 351,661 83{l.216 961,041 Increase Applications for amateur radio operators are included in the total for the safety and special radio services. CORRESPONDENCE During the fiscal year the Commission's Washington office (exclu sive of its Field Engineering Bureau) handled more than 4.6 million pieces of mail, of which over 3 million were incoming and 1.5 million outgoing. This is about the same volume as last year. 28 FEDERAL COMMUNICATIONS COMMISSION I964A~'NuALREPORT RELEASES AND PUBLICATIONS Commission releases comprise public notices of its actions, certain filings with it, and documents coveriug its formal decisions and orders. The Commission does not maintain mailing lists for this issue. However, the texts of its major decisions appear in weekly pamphlets which can be subscribed to at the Government Printing Office. All Commission hearing orders and rulemaking-the latter both proposed and as adopted-are given official promulgation in the Fed eral Register, and copies of FCC rules and regulations are sold, also on a subscription basis, by the Government Printing Office. Other FCC printed publications can be purchased from that source. They include the Communications Act, annual and other reports, statistics of communications common carriers, etc. A list will be furnished by the Commission on request. The Commission's own offset reproduction for release and internal use during fiscal 1964 required 80,510 plates (master copies) and 33.2 million prints, which consumed 26.1 million sheets of paper (nearly 2 million sheets more than in 1963). TECHNICAL ASSISTANCE TO FOREIGNERS In continuing participation in the foreign technical assistance pro gram, the Commission provided technical training to 46 persons from 18 foreign countries during the year. Additionally, 75 visitors from 21 other nations were given technical assistance. The FCC monitor ing station at Laurel, Md., provides on-the-job training in radio fre quency monitoring and direction finding to those foreign visitors interested in that particular communication activity. This joint program of the Department of State, the Agency for International Development, and the International Telecommunication Union affords opportunity for foreign communic<%tion keymen to study and observe communication systems in the United States, also visit equipment manufacturers and suppliers, institutions for technical training, and Federal, State, and local government agencies. ALIEN RADIO OPERATION In general, the Communications Act limits Commission licensing of radio stations and transmitter operators to citizens of the United States. Further, the license privilege is denied to corporations in which any officer or director is an alien or of which more than one-fifth of the capital stock is owned by aliens or foreign interests. However, there are several exceptions: On May 28, 1964, the President signed a new law (Public Law 88 313) to permit authorizing amatllurs of other countries to engage in FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 29 amateur radio operation while in the United States. A 1952 conven tion between the United States and Canada enabled amateurs of those countries to do such across-the-border operation. In the interest of air safety, a 1958 law (Public Law 85-81'7) per mits the licensing of certain alien pilots who fly aircraft in the United States. Under a 1962 law (Public Law 87-795), the President can authorize foreign governments represented in the United States to, on a recipra:: cal basis, operate radio stations in Washington to communicate with their home administrations. Law and Enforcement LEGISLATION Legislation Enacted During those parts of the 1st and 2d sessions of the 88th Congress which made up the fiscal year 1964, only 3 laws were enacted amending the Communications Act of 1934. Included were two proposals submitted by the Commission as part of itB legislative program for the 88th Congress. They were enacted into law in the second session as follows: An amendment to paragraph (2) (G) of subsection 309(c) giving the Commission additional authority to grant special temporary authori zations for 60 days for certain nonbroadcast operations. It was signed into law on May 14, 1964 (Public Law 88-307). An amendment to subsection 309(e) which requires that petitions for intervention be filed not more than 30 days after publication of the hearing issues in the Federal Register. Itbecame law on May 14, 1964 (Public Law 88-306). In addition: Public IJflw 88-313, signed by the President on May 28, 1964, amended sections 303 and 310 to provide that the FCC may authorize, but not license, alien amateur radio operators to operate their amateur radio stations in the United States, its possessions and Puerto Rico, pro vided there is in effect a bilateral 'agreement between the United States and the alien's government for such operation by U.S. amateurs on a reciprocal basis. FCC Legislative Program Commission proposals to amend the Communications Act intro duced in the 88th Congress and pending at the end of the fiscal year were: An amendment to exempt from the conflict·of-interest provisions of section 4(b) persons serving in the FCC unit of the National Defense Executive Reserve who are not otherwise employed by the Commission (S. 1504, H.R. 6019). An amendment to section 4(b) to exempt "Special GovernmentEm~ ployees" from theconfllct~of~interestprovisions thereof (S. 2319, B.R. 9155). 30 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 31 An amendment to sectiou 310(b) to give the Commission disere- lion to adopt ne\ypr~eduresto govern~pp~icationsfor the transfer or assignment of a construction permit or license for a broadcast station (H.R. 7477). (Commissioner Bartley submitted a separate proposal which was introduced as H.R. 7478.) An amendment to section 203 to require a connecting carrier to :ftle a tariff covering communications subject to the Commission's juris· diction where there is no fully subject carrier obliged under the statute to file a tariff (S. 1503, H.R. 6018) . An amendment to 'Section 204 to extend from three to nine months the period during which the Commission may suspend any new or revised charge, classification, regulation or practice of a communication common carrier pending hearing and decision under section 204, and to place the burden of proof on the carrier to justify all new or revised schedules (S. 2051, n.R. 8613). To add a new section 223 to Title II giving the Commission regulatory authority over the charges and other terms and conditions in arrange ments between communication common carriers for the interchange of their communication facilities or the furnishing of facilities or services by one carrier to another (8.2624, H.R.I0210). To add a new section 302 to Title III giving the Commission authority to prescribe regulations for the manufacture, import, sale, shipment or use of devices which cause harmful interference to radio reception (S. 2684, H.R. 10589). A Commission legislative proposal to amend section 4(b) to remove inequities imposed by conflict-of-interest provisions on Commis sioners and employees was cleared by the Bureau of the Budget on June 29, 1964. It was transmitted to the Congress at the beginning of fiscal year 1965. Commission legislative proposals awaiting clearance by the Bureau of the Budget at the close of theyear were: An amendment to section 303(q) to give the Comission jurisdiction to require the painting and illumination of abandoned radio towers and to require dismantlement when they constitute a menace to air navigation. An amendment to the Internal Revenue Code of 1954 to suspend for a specified period the manufacturers' excise tax on all-channel TV re ceivers. Other Bill. Affecting the FCC During that period of the 88th Congress covered by the fiscal year, 41 bills were introduced which affected the Commission's functious. Requests for comments were received on most of these bills. Congressional Hearings During fiscal 1964 the Commission appeared and testified before congressional committees on such matters as : Independent Offices Appropriation bills. Editorializing by broadcast licensees (H.R. 7072). 82~'EDERALCOMMUNICATIONS COMMISSION 1964 ANNUAL REPORT Amendment of section 308 with respect to construction permits and broadcast license applications involving members of Congress (S. 708). Special temporary authorizations (8.1005). Petitions for intervention in Commission proceedings (8.1193). Alien amateurs (S. 920). Broadcast commercials (H.R. 8316). Small business procurement regulations for the Communications Satellite Corporation. Radiotelegraph equipment on ships (B.R. 8508). Assessment of fees (H.R. 6697). Review of FCC activities in the field of satellite communications. Common carrier matters described under heading "FCC Legislative Program" (H.R. 6018, H.R. 8013, and H.R.10270), LITIGATION Th~Commission was a party to a nnmber of court cases which enunciated principles of administrative law having an immediate and significant effect upon the Commission's procedures and its adminis tration of the Communications Act. Court of Appeals Decisions of Special Significance The following decisions (in the Court of Appeals for the District of Columbia Circuit except where otherwise noted) are of particular interest: On February 17,1964, the U.S. Court of Appeals for the Ninth Circuit decided the case of Federal Oommunications Oommission v. Taft B. Schreiber alld MOA, Inc., 329 F. 2d 517. This was an appeal by theCom~ mission from certain procNlural eonditlons which the U.S. District Court for the Southern District of California had attached to its order enforcing a Commission subpoena and orders issued in the FCCinvestl~ gation of the TV broadcast industry (FCC docket 12782). The su}).. poena and orders, which had been directed to MCA, Inc., and its vice president, Taft B. Schreiber, called for the disclosure of all network TV 'Programs which MeA had either produced or "packaged" or in which MCA had a financial interest. MCA, through its spokesman Schreiber, refused to provide the data requested with respect to "packaging" in a public Commission proceeding on the ground that information in the nature of trade secrets might be disclosed. He declined to amplify the reasons for the refusal untesR his 'COllllsel were given the right to object on the record to all questions put to Schreiber by FCC counsel while Schreiber was on the witness stand. Counsel for MeA contended that section 6(a) of the Administrative Procedure Act granted such a right to counsel. The Commission denied MCA's contentions on both the "right to counsel" and confidentiality points, and, when MCA persisted in its refusal to comply with the subpoena, the Commission sought judicial enforcement. The district court found ample legal authority for the enforcement of the subpoena, but agreed with MOA's position on the "right to counsel" and confidentiality points and, accordingly, attached conditions to its enforcement order. whereupon the Commission appealed. FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 33 The appeals court held in the subject decision that the district court did not abuse Its discretion in requiring that all further testimony be taken from MeA and Schreiber in nonpublic sessions, after which it would be incumbent upon the Commission to persuade the district court that public disclosure was warranted. The appeals court, however, re versed the district court on the "right to counsel" point and held that counsel for Schreiber could advise him while he was on the witness stand, but that further participation by counsel in the investigative pro ceeding would be a matter for Commission discretion. The appeals court also overruled MeA's contention that the Commission had failed to pro mulgate ground rules governing the proceeding. The Commission's petition for rehearing on the confidentiality issue was denied by the appeals court on May 4, 1964. In Immaculate Conception Church of L08 Angeles v. Federal Com munications Commission, 116 U.S. App. D.C. 73, 320 F. 2d, 795, cere. den. 375 U.S. 904, the court affirmed the Commission's denial of the applica tion for renewal of license for AM broadcast station KRLA, Los Angeles. The Commission denied renewal on the grounds that the station bad broadcast deceptive contests, and that the owner had failed to maintain effective control of the station, Rnd had attempted to mislead the Com mission with respect to the station's programing operations. In af firming, the court held that the Commission's findings were within the scope of the hearing issues and were supported by substantial evidence ot record. The court held further that the Commission properly re fused to consider the public service programing efforts of the sta tion which were made after the owner learned that his license was in jeopardy. In E. G. Robinson v. Federal Communications Commission, - U.S. App. D.C. --,--F. 2d -, decided March 19, 1964, rehearing denied May 7, 1964, the court affirmed the Commission's denial of the applica tion for renewal of license for AM station WDKD, Kingstree, S.C. The Commission denied the renewal because the station had made a practice of carrying programs which were vulgar and patently offensive under any standard, and because the licensee had misrepresented his knowledge of such programs to the Commission. In affirming, the court did not pass upon whether the Commission was justified in denying the application because of the pro:!rams broad cast by the station. The court beld that the Commission had the right to seek information concerning the station's broadcasts and that the Commission was fully warranted in denying renewal because of the applicant's misrepresentations concerning his knowledge of such broad casts. In a separate opinion, Judge Wilbur K. Miller stated that he be lieyed that the court's opinion did not go far enough. According to Judge Miller, the Commission's denial of the application on program ing grounds was proper, since the programs in question were clearly in violation of the statute prohibiting obscene and indecent broadcasts. In Sprinufield TeleVision Broadcasting Corp. v. FederalCommunica~ tions Commission. - U.S. App. D.C. -, 328 F. 2d 186, the court upheld the Commission's authority to require that objections to a grant at a broadcast application be submitted in a pre-grant petition to deny. The Commission dismissed a petition for reconsideration of a grantwith~ 34 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT out hearing of an· application for a TV translator station on the ground that the petitioner had not filed. a petition to deny prior to the grant, and had not shown good cause for its failure to do so. In affirming, the court held that, while the Communications Act does not provide for a mandatory pre-grant procedure. the Congress "fully anticipated that ••• this would be the normal procedure, and that when a party for the first time appears in the proceeding with a petition for reconsideration he should show why he had withheld tbe facts, or was unable in season to obtain the facts, on which he relies." The court also found tbat the Commission had not abused its discretion in deciding that no public in terest questions were presented which were of such importance as to require reconsideration despite the failure to make objection prior to the grant. In Kessler v. Federal Communications Commission, - U.S. App. D.C. -, 326 F. 2d 673, the court upheld the Commission's power to impose a "freeze" without advance notice on the acceptance of applica tions for new AM broadcast stations pending adoption of new rules. Rejecting the contention that the "freeze" order constituted a sub stantive rather than a procedural rule change, the court found that the Commission's order did not require the advance notice and public participation specified by section 4 of the Administrative Procedure Act. The court also held that the Commission could reasonably pro ceed to process applications already on file, and that the Commission was acting within its discretion and expertise in establishing the follo\ving exceptions to the "freeze": (a) applications which would bring service to areas without service and which would cause no interference to existing stations; (b) applications for new Class II-A facilities (since the Commission bad already determined in the clear channelproceed~ ing that these new assignments would serve the pUblic interest) ; and (c) most applications for Class IV power increases. The court also sustained the "freeze" as to applicants with actual notice of the "freeze" order who submitted their applications prior to the date of publication of the order in the Federal Register. With respect, however, to the cases of certain applicants who claimed that their applications would be mutually exclusive with applications al ready on file and available for processing, the court found that the re fusal to accept these applications would deprive these applicants of their rights to comparative hearings under Ashbacker Radio Oorp. v. Federal C01nmtmications Commis8ion, 326 U.S. 327 (1945) and,ac~ cordingly, remanded these cases for Commission consideration of whether mutual exclusivity' existed in the case of each applicant claim ing it, and whether the Commission Wished to waive the "free"ze" on acceptance of applications from applicants claiming mutual exclusivity, or wlthold action on the previously pending applications pending conclu sion of the rulemaking. In Capitol Broadcasting Company v. Federal OommunicationsCo~ mis8ion, 116 U.S. App. D.C. 370, 324 F. 2d 402, the court sustained the Commission's grant without hearing of the application of a TV station on Channel 12 in New Orleans for a modification of its construction per mit to change its transmitter site. The change was to a point which was less than the minimum mileage separation under the Commission's rul('s FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 35 from another objecting party on the same channel in another city. The court sustained the Commission's holding that the change of transmitter site did not constitute a modification of the lieense of the objecting co channel station, where the grantee was required to modify its signal so as not to cause any more inteference under the modified permit that it would have caused it its station bad been constructed and operated in accordance with the standard transmitter spacing requirements. The court also held that no substantial and material questions of fact were presented by the pleadings before the Commission, and that the factual issues raised were adequately appraised by the Commission. In KWK Radio, Ino, v. Federal Communica.UOtHJ Commission, -U.S. App. D.C.-, - F. 2d-, the court sustained the- Commission's order revoking the license of AM broadcast station KWK, St. Louis. The Commission based the revocation on findings that KWK, under the di rection of one of its corporate officers, bad conducted two treasure hunts in a manner which constituted deliberate fraud upon the public. The court upheld the Commission's view that KWK Was not entitled to a warning prior to the institution of revocationpr~eedingssince section 9(b) of the Administrative Procedure Act eliminates this requirement where revocation is based on willful conduct. The court also held that tbe Commission's determination that revocation was the appro priate sanction in this case was not unreasonable. Statistics During the fiscal year the Commission was a party to 87 cases in the Federal courts. Forty-five new appeals were instituted during that period-6 on petition for writ of certiorari in the Supreme Court; 33 in the Court of Appeals for the District of Columbia Cir cuit; 2 in the Court of Appeals for the Seventh Circuit; 2 in the Court of Appeals for the Second Circuit; 1 iu the District Court for the Northern District of Illinois; and 1 in the District Court for the District of Columbia. At the beginning of the fiscal year, 42 cases were pending in the Federal courts. Forty of these cases were in the Court of Appeals for the District of Columbia Circuit; 1 was in the Court of Appeals for the Second Circuit; and 1 was in the District Court for the Northern District of Ohio. Five of the six petitions for certiorari filed during the fiscal year were denied by the Supreme Court. In the courts of appeals, the Commission was affirmed in 31 cases and reversed in 6; 21 cases were dismissed on either jurisdictional grounds or by agreement, or re manded without a decision on the merits. At the fiscal yearend 20 cases were pending in the Court of Appeals for the District of Columbia Circuit. Seven of these cases have been orally argued and await decision on the merits. One case is pending in the Supreme Court; two cases are pending in the Court of Appeals for the Seventh Circuit, and 1 is peuding in the District Court for the Northern District of Ohio. 36 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT A tabulation of cases decided and pending in the courts for fiscal 1964 follows: Court of Appeals for the District of Columbia Circuit Other Supreme '---,----,----1 courts of District Court I appeals courts 402 (a) 402 (b) 402 (a) I and (b) Total ------1-------------- TotaL _ 6 9 52 12 6 3 87 21 5 24 Sl 6 232 {I _.~_ 3 22 3 13 Decisions affirming the Com- mission _ DecisIons reversing the Com- mission__ • ._______ _ _ _ Cases dismissed on Jurisdic tional grounds, by agree- me!?t._ or remanded without decIsIOn~. __ g:~:~~~%~iO~~e30,-i964-(~~~------ -4- -------i4- ------ -2- --------2- -- -----1- 1 Cases under "402(,1) and(b)" were cases where the same party sought review of the same Commission order under both sections 402(a) and 402(b) of tho statute. 2 Cases which have been adjudicateo on the merits, but in which 1 of the parties has sought a rehearing, have not been included In this category. ENfORCEMENT The practical effectiveness of the Commission's anthority to impose monetary forfeitures on broadcast licensees should be determined to a large extent in four civil actions filed in April 1964, in the United States District Court for the District of Minnesota. The cases place in issue for the first time before the courts the meaning of the words "willfully or repeatedly" as used by Congress in section 503 of the Communica tions Act. The licensees are four Twin Cities TV stations. On Octo ber 30, 1963, they were ordered by the Commission to each forfeit $500 for failure to identify a group of local merchants as the sponsor of broadcasts supporting a Sunday closing ordinance. When they de clined to pay the forfeiture, the cases were referred to the Department of .Justice for collection. Many forfeitures imposed under section 510 of the act were collected administratively, but three cases were referred to the Department of Justice for collection. It is expected that such referrals will increase in the next fiscal year. During fiscal 19648 criminal cases were referred to the Department of Justice, and at the end of the year 10 criminal cases were pending, 2 of which are appeals from convictions. One of these convictions was that of a diskjockey for broadcasting obscene language. Also note worthy waS conviction, before the U.S. District Court for the District of Columhia, of three individuals for operating an unlicensed radio transmitter in violation of the Communications Act and the Commis sion's rules. The court sentenced each of the defendants to imprison ment for 1 year and a fine of $500. The violations took place at the Mayflower Hotel inWashington, D.C., during April 1962, and involved the operation of a miniature radio transmitter commonly known as a "bug" or ea.vesdropping device. National Defense GENERAL "For the purpose of the national defense" is one of the major objec tives of the Federal Communications Commission as stated in the Communications Act of 1934 which created it. Under the war emer gency powers given him by that statute, the President can, and does, delegate to the Commission various functions concerning regulation of non-Government radio, wire, and cable communication facilities in time of national crisis. Defense activities of the Commission during the year were geared to implementing Executive Order 11092 of 1963 which gave the FCC new and unprecedented responsibilities in mobilizing the com munication industries for the national defense program. The scope of these FCC activities are summed up in section 1 of the Executive order as follows: The Federal Communications Commission * • * shaH, subject to the policy guidance of the Director of the Office of Emergency Planning, prepare national emergency plans and develop preparedness programs covering provisions of service by common carriers, broadcastingfacili~ ties, and the safety and special radio services; assignment of radio frequencies to Commission licensees; and the protection, reduction of vulnerability, maintenance, and restoration of facilities operated by its licensees in an emergency. These plans and programs shall be designed to develop a state of readiness in these areas with respect to all condi· tiona of national emergency including attack upon the United Sta.tes, and will take into account the possibility of Government preference or priority with common carriers or of exclusive Government use or con trol of communications services or facilities, when authorized by law. In coordinating broadcast, common carrier, and other of its licensed communication services to the defense effort, the Commission is as signed specific functions. These include controlling electromagnetic radiation of apparatus not used for communication purposes; furnish ing advice and gnidance for protecting essential communication fa cilities j making damage assessments; stimulating plans for conserva tion and salvage of communications equipment; restoring service after attack; establishing priority systems for emergency communications; 37 745-960--64----4 38 FEDERAL COMMUNlCATIONS COMMISSION 1964 ANNUAL REPORT and fostering or conducting research in the emergency matters for which it is responsible. In being given the initiative for the development of such plans and programs, the Commission maintains close cooperation with the indus tries and the Federal agencies concerned, including the Department of Defense in connection with the latter's civil defense program. The Commission's preparedness activities are directed by Defense Commissioner Bartley, with Commissioners Lee and Cox as Alternate Defense Commissioners. An FCC Office of Emergency Communica tions began functioning on July 1, 1963. EMERGENCY BROADCAST SYSTEM Of prime importance is the Commission's maintenance and strength ening of an Emergency Broadcast System (EBS). Established by the FCC on December 4, 1963, in concurrence with the Department of Defense and the Office of Emergency Planning, this system replaced an interim EBS. In accordance with Executive Order 11092, the Emergency Broad cast System was devised to provide the President and other Federal officials, as well as State and local authorities, with a means of speedily reaching the general public through broadcast stations in the emer gency network preceding, dnring and following an enemy attack or other national emergency. The plan for the Emergency Broadcast System is based upon both White House and Office of Civil Defense requirements. The Presi dent requires a 5-minute capability, regardless of his whereabouts, to address the Nation following an Emergency Action Notification. Pursuant to this need, the Commission on June 25, 1964 announced that it was establishing 63 Presidential Program Origination Points thronghout the United States. The White House Communications Agency, acting for the Presi dent, will deliver presidential communications to control centers selected for the origination of presidential messages and national cmergency programing and news. The Office of Civil Defense primary requirement is the capability of the emergency network to disseminate civil defense information to the public on a nationwide, regional, State, or local basis. This is achieved by the use of regional, State, and local interconnections of certain facilities licensed by tbe FCC. The Emergency Broadcast System has the cooperation of the na tional press services (the Associated Press and United Press Inter national) in using their teletype facilities to transmit official Emer gency Action Notifications. Also, provision is made for telephone companies to participate, likewise without charging, in connecting FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 39 unaffiliated stations with networks in order for the latter to receive the emergency programing. In establishing the Emergency Broadcast System, the Commission made special provision for the continued use of emergency net works to broadcast warnings of serious storm threats to life and property, with the cooperation of the U.S. lVeather Bureau. About 1,500 stations are now authorized to participate in the Emergency Broadcast System. NATIONAL DEfENSE EMERGENCY AUTHORIZATIONS In order to provide for the development of optimum interIer ,ence-free emergency relay capability, selected FM and TV (aural facilities only) stations are issued Natioual Defense Emergency Authorizations to participate in State Defense Networks (FM), Regional Defense Networks (FM) and Local Programing Con trol. Approximately 215 such authorizations were outstanding at the close of the fiscal year. Only such authorized FM and TV stations will continue on the air after an Emergency Action Notifi cation is issued; all others must cease operation during the emergency. fALLOUT PROTECTION fOR AM AND fM STATIONS By the close of the fiscal year more than 300 AM and FM broad cast stations holding National Defense Emergency Authorizations had been provided with fallout shelters under the civil defense program. An equal number of additional stations is expected to be so equipped in the new year, and the ultimate goal is 1,500 to 1,800 stations. Initiated in fiscal 1962 as the Radio Station Fallout Shelter Pro gram, the project is now known as the Broadcast Station Protection Program. The Office of Civil Defense, Department of the Army, provides the funds. In addition to furnishing shelters protected from nuclear fallout, the program includes emergency power gen erating and other equipment. Participating stations are selected by the Office of Civil Defense on the basis of their relation to the Emergency Broadcast System. Recommendation is made by the FCC State Industry Advisory Committees subje",t to approval, in turn, by the FCC National Industry Advisory Committee and the FCC. FCC INDUSTRY ADVISORY COMMInEES On December 4, 1963, the Commission determined that the con tinued functioning of FCC National, Regional and State Industry Advisory Committees is necessary in discharging its national 40 FEDERAL COMMUNICATIONS COMMISSION I 964 ANNUAL REPORT defense obligations. In addition to the national committee, 8 re gional and 50 State committees are now operating. The National Industry Advisory Committee was created by the Commissiou to advise aud assist it in defense communication plan ning. Subject to concurrence of the FCC and other Federal agencies concerned, various NIAC units study and make recommen dations concerning the Emergency Broadcast System and backup circuits and communications systems and arrangements for emer gency use. On June 26, 1964, the Commission adopted certain NIAC recom mendations and amended the Emergency Broadcast System plan in various particulars. One provides that, should normal broad cast network facilities at the Nation's capital be disrupted by enemy attack, the American Telephone & Telegraph Co. would use the facilities of the four major networks to form one composite network. Regional Industry Advisory Committees, one in each of the eight defense areas, are composed of representatives of State Industry Ad visory Committees. State Industry Advisory Committees act as liaison between civil defense officials and FCC licensees in their respective States. Also, subcommittees of the State groups per form the same service locally. OTHER EMERGENCY PLANNING COOPERATION The Commission participates in various phases of national emer gency planning with five Federal interagency groups-the Inter agency Civil Defense Committee of the Office of Civil Defense; the Interagency Emergency Planning Committee of the Office of Emer gency Planning; the Federal Agency Representatives at the Office of Emergency Planning's National Government Relocation Site; the Interagency Committee of the National Defense Executive Re serve; and the National Resources Evaluation Center. The Commission maintains its own emergency relocation site in a state of readiness. FCC EXECUTIVE RESERVE UNIT Members of the Commission's unit of the National Defense Execu tive Reserve are selected from all branches of the communications industry as well as former FCC and other Government execu tives. Two-day training sessions were held twice during the year. More than half of the FCC reservists are engaged in Industry Advisory Committee work. Space Communication GENERAL This section of the report is pursuant to section 404 (c) of the Communications Satellite Act of 1962 which requires the Com mission to report annually to Congress on its role in such activities. The coordinated efforts of the Commission, other interested depart ments and agencies of the Govermnent, the Communications Satel lite Corporation and private industry have moved the national 'communication satellite program toward practical realization. The past year was marked with solid and significant achievements despite the complex organizational, technical, administrative, and international problems connected with the establishment of global -commercial communication via satellites. For example, international agreement has been reached on the allo -cation of radio frequencies for space communication services. The Corporation, pursuant to Commission authorization, has com menced construction of an early capability satellite system-the so ·called "Early Bird" system. Negotiations for international par ticipation in the system have progressed to a point where satisfactory arrangements were completed with the initialing, on July 24, 1964, by 14 nations of the interim agreement. By November 1 thereafter 18 natipns had signed the documents. The public and authorized communications common carriers have fully subscribed to the ini tial stock issue of the Corporation in the aggregate amount of $200 million. Private industry has responded vigorously to invi. tations of the Corporation for system design proposals and related contracts, under procedures established by the Commission which are designed to afford all concerns, including small business, equitable opportunity to compete for procurement requirements of the system. In short, the national policy to establish a worldwide com mercial communication satellite system as expeditiously as prac ticable has been aggressively and responsibly pursued. The accom plishments to date attest to the soundness of that policy and the dedication and resourcefulness of those in Government and industry who are engaged in its implementation. 41 42 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUALREPORT~ COMMUNICATIONS SATELLITE CORPORATION The Communications Satellite Act of 1962 provides that the U.S. portion of the global satellite system be owned and operated by a private corporation-the Communications Satellite Corporation organized in accordance with the statute and subject to Federal. regulation. As reported in the FCC's 1963 annual report, this Corporation wa& formally incorporated under the laws of the District of Columbia on February 1, 1963, following approval by the President of the articles of incorporation. It was recogoized that the Corporation would not be fully estab lished until the initial stock offering had been arranged and the new stockholders had elected their directors. The act provides that it is the responsibility of the incorporators now acting as the first board of directors to arrange for this stock offering and to take snch other actions as are necessary to establish the Corporation. As a prerequisite to effectuating the stock offering, the articles of incorporation were amended, principally to allow for an increase in authorized capital stock to 10 million 100 shares. The President, after consultation with the Commission and other Federal agencies,. approved the articles as amended. Initial Stock Issue On May 6, 1964, tbe Corporation filed the registration statement re lating to the initial offering of voting stock with the Securities and Exchange Commission. Later that month, the Corporation sent tt> all the authorized carriers invitations to subscribe for the shares of stock reserved for sale to these carriers. The Corporation had determined tbat the offering price of the stock would be $20 per share and tbat the entire issue would be 10 million shares at that price. Consequently, in accordance with the provisions of the act, one-half of the entire issue of $200 million (5 million shares) were reserved for sale to the carriers. An allocation formnla had been arrived at by the Commission and the Corporation to be used in the event the carriers as a group subscribed for more than the $100 million allocation of stock among authorized carriers. On May 26 tho subscriptions were opened and were accepted on ,Jnne 2, after the registration statement became efi'ective, and stock went on sale to the public on that day. The act requires the Corporation to sell the shares of the initial offering "* * * in a manner to encourage the widest distribution to the American public". After determining that the stock should be dis tributed in the normal manner using the services of underwriters, the Corporation selected a managing group of 11 underwriting firms. FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 43 These finns in turn selected a distributing group of some 385 addi tipnal· underwriters, possibly the largest underwriting group for a single issue of stock. The underwriters and the stockbrokers distributing shares of this issue were required to agree that they would not sell in allotments of more than 50 shares to each customer. This could be increased to 100 shares if the seller could not otherwise dispose of his shares. Public demand fpr the stock was extremely heavy and it is reported that the shares were alIocated in lots considerably slllitl1er than 50 shares. Now that the initial offering has been made, the Corporation expects to hold the stockholders' meeting for election of new directors in September 1964. At that time, the carrier-owners will elect six directors, the public stockholders another six and the President will appoint three members by and with the advice and consent of the Senate. COMMISSION ACTIVITY As noted in its 1963 annual report, the Commission established an Office of Satellite Communications to assist it in meeting its responsi bilities under the SateHite Act. A brief summary of these activities fol1ows: Financ:ing of the Corporation Fol1owing ineprporation, the Corporation needed interim financing for its operations until stock could be issued to the general public and authorized carriers as required by the provisions of the Satel1ite Act. To meet this need, the Commission, pursuant to section 201(c) (8), authorized the Corporatipn to enter into a $5 million line-of-credit agreement with 10 banking institutions throughout the country and to draw an initial amount of $500,000. Commissipn approval of this transaction was conditioned so as to require that any additional bpr rowing be made only upon specific authorization. In July 1963 the Corporation asked authority for an additional $600,000 borrowing. In approving this request the Commission urged the Corporation to formulate definite plans to proceed with the initial offering of voting stock to the public and to the authorized communica tions common carriers. The Commission stated that unless the Cor poration could show what steps were being taken to insure the issue of the capital stock at the earliest practicable date, the FCC would be unable, in passing upon future authorizations to borrow money, to make the required finding that the activities of the Corporation are consistent with carrying out the purposes and objectives of the act. After receiving such assurances, the Commission approved an ad ditional borrowing of $800,000, thus having authorized the Corpora- 44 FEDERAL COMM1JNICATIONS COMMISSION 1964 ANNUAL REPORT tion to borrow a total of $1.9 million. These later borrowings, how ever, contained a condition that the funds obtained thereby could not be used for operating expenses beyond a certain date without specific approval of the Commission. This date, upon request of the Corpora tion, was extended several times as the Commission was informed of the Corporation's progress toward the initial offering of stock. The terms of the $5 million line of credit stipulated a termination date for the agreement and maturity date for the loans made under it of February 28, 1964. The Corporation submitted for the Commis sion's consideration a supplemental agreement which in effect extended the termination and maturity date to June 30, 1964. On February 19, 1964, the Conunission approved this supplemental agreement. Allocotion of Stock Among Authorized Carriers The Satellite Act provides that only those communication common ~arriersauthorized by the Commission may own voting stock of the corporation and such ownership may not exceed in the aggregate 50 percent of such stock issued and outstanding. The Commission, pnrsuant to rules adopted in December 1962, au thorized, as of July 1, 1964, 219 communication common carriers to own such stock. The authorizations issued to the carriers provide, among other things, that in the event of an oversubscription of the stock reserved for sale to the carriers the Commission may allocate such stock among the authorized carriers. In order to implement this provision, in such a manner as not to impede the sale of stock, the Commission and the Corporation co 'operated to achieve a workable and equitable formula. This formula, adopted by the Commission on April 29, 1964, essentially provided for the reduction of any subscription for more than $50 million of stock (50 percent of the amount reserved for sale to the carriers) until either the oversubscription was eliminated or until the subscription was reduced to the $50 million figure. Thereafter, all the subscrip tions would be reduced pro rata. However, in order to protect the right of the small carriers to subscribe for a sizable amount of the issue, the allocation formula further provided that in no event would any subscription be reduced below 5,000 shares, thus assuring every carrier the right to buy at least $100,000 of stock of the $100 million which was reserved for sale to the carriers. The carriers, however, subscribed for $127 million of stock, or $27 million more than they could purchase. Applying the allocation formula, it was necessary to reduce the subscription of only one car rier, which had subscribed for $85 million. Every other carrier was ",ble to purchase all of the shares itsubscribed for. FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 45 The major purchases by carriers are as follows: American Telephone & Telegraph Co $57,915,000 International Telephone & Telegraph Co_________________ 21,000,000 General Telephone & Electronics Corp___________________ 7,000,000 RCA Communications, Inc .. 5,000,000 Telephones, Inc________________________________________ 2,000,000 Time, Inc______________________________________________ 1,500,000 Hawaiian Telephone Co_________________________________ 1,000,000 Western Union Interuational__________________________ 1,000, ()(}() Safeguards ,Against Stock Speculation On June 3, 1964, the Commission proposed (docket 15495) to amend part 25 of its rules and regulations so as to curb any undesirable speculation in carrier-owned Corporation stock. The amendment, adopted July 15, requires any carrier desiring to transfer, sell, pledge or otherwise dispose of such stock to an entity other than another authorized carrier to secure Commission approval prior to such trans action. A collateral provision prohibits the Corporation from trans ferring on its books any stock involved in a transaction requiring the Commission's approval without an FCC order approving the trans action in question. These rules remain in effect until June 1, 1965. Procurement Policies and Practice Section 201(c) (1) of the Satellite Act requires that the Commission insure effective competition, including the use of competitive bidding where appropriate, in the procurement by the Corporation and by communication common carriers of apparatus, equipment and serv ices required for the establishment and operation of the satellite system and its terminal stations. The Commission implemented its responsi bilities by promulgating rules and regulations which became effective on February 24, 1964. The rules were adopted after consideration of the views of interested segments of industry and consultation with the Small Business Administration (SBA) and other interested Gov ernment agencies. They are desigued to afford all concerns, includ ing small business, equitable opportunity to compete for procurement requirements of the system. The Commission has held discussions with a number of prospective contractors and subcontractors with respect to application of the rules under given situations. Private industry has welcomed this approach and such discussions have proved mutually beneficial. In particular, and pursuant to Satellite Act directions, the Commission has worked closely with the SBA in developing a continuing liaison with a view toward enlarging the scope of small business procurement participa tion to the extent practicable. Under procedures established by the FCC rules, the Corporation and its prime contrnctors have entered into a number of procurement 46 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT contracts including such matters as multiple-access studies, synchro nous satellites for any early capability system, and engineering design studies for the basic global communication satellite system. '"Early Bird" System On April 15, 1964, the Commission granted application by the Cor poration for authority to construct a communications satellite system for synchronous orbit with the earth. It is planned to position this satellite 23,300 miles ahove the North Atlantic for use on an experi mental/operational hasis hetween the United States, Canada, and Western Europe in order to determine the suitability of synchronous satellites for voice and record telecommunications. In the event the facilities function satisfactorily under test operations, the Corporation intends to use the system for transmitt;ng commercial traffic. The facilities authorized to be constructed consist of 2 satellites with a capability of approximately 240 2-way 4 kc voice channels to be positioned in nearly equatorial orbit over the Atlantic Ocean. The launching is scheduled to occur in the early part of 1965 by means of facilities and services provided by the National Aeronautics and Space Administration (NASA), on a reimbursable basis, under the terms of an agreement to be entered into between NASA and the Corporation. The proposed launch vehicle is the thrust augmented Thor-Delta and the launch site is to be the John F. Kennedy Space Center in Florida. By the terms of a Commission order, the system cannot be placed in orbit until the Corporation has requested and obtained specific au thorization from the FCC to engage in experimental operations and until the latter has authorized a ground station in the United States to be used in connection with the system. The order also requires the Corporation to obtain specific authority before engaging in commercial service via the system. On July 29, 1964, the Commission authorized the use of the existing earth station at Andover, Maine, under the terms of a lease agreement between the Corporation and A.T. & T. While the Commission's action represents a significant step in the development of an operahle system, it should be emphasized that a number of technical and other questions must be solved before a global system as contemplated by the Satellite Act can be established. Ac wrdingly, it is expected that the Corporation wiII continue to pursue a program of study, research and development of multiple-access techniques, satellite attitude and stabilization devices, modulation methods, various orbital configurations, and other relevant technical areas of communication space technology. FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT 47 INTERNATIONAL DEVELOPMENTS 'Space Frequency Allocation Considerations The International Telecommunication Union (ITU) held a fre 'quency allocation conference (Extraordinary Administrative Radio Conference to consider frequency allocations for space radio communi cation purposes and radio astronomy) in Geneva, October 7 through November 8, 1963. The U.S. delegation to this Conference included Commission representatives, together with those of other interested Federal agencies and of industry. The Conference dealt with a num ber of specialized requirements, e.g., space research, meteorological satellites, radionavigation satellites. Frequency allocations for the communication satellite service were of particular interest to the Commission due to its statutory responsibilities under the Satellite Act. The conference attempted to allocate sufficient spectrum space to satisfy anticipated communication satellite service requirements up to about 1975. For this purpose it designated approximately 2800 Mc of spectrum space in the frequency range 1000-10,000 Mc, 2000 Mc of which is immediately useful to the United States. Existing incom patible terrestrial operations (high-power radar, for example) in this part of the world make use of the remaining 800 Mc for space com munication purposes quite difficult. All except 100 Mc of the 2800 Mc of spectrum space must be shared with terrestrial radio services, prin cipally line-of-sight radio relay networks. The 100 Me which is ex clusively for the communication satellite service is intended printarily to accommodate mobile earth stations and satellites having higher powered transmitters than can be permitted in the shared bands. In the United States, the final acts of the space conference have been handled as a treaty rather than as an executive agreement. The Senuts gave its advice and consent to ratification on February 25, 1964, and the instrument of ratification was deposited with the Secretary General of the ITU on April 3, 1964. The treaty comes into force internationally on January 1, 1965, as between the parties thereto. The Commission has been participating in the interagency activity necessary to implement the space frequency allocations domestically. Necessary changes in the Commission's rules are expected to be com pleted before the treaty comes into force. Internationally, considerable work remains before the spectrum space designated for satellite communication purposes can be used most effectively. Agreement is necessary on how the allocated bands will be subdivided for use by particular space systems or subsystems. Also, the highly technical criteria for sharing of frequencies between the communication satellite service and terrestrial radio services are only provisional. Preparatory work, therefore, ;s going forward in 48 FEDERAL COMMUNICATIONS COMMISSION 1964 ANNUAL REPORT this area, in connection with international meetings scheduled to be held in 1965 and 1966 by the International Radio Consultative Com mittee (CCIR) oftheITU. ArrangementS' for Foreign Participation The accelerated pace of developments in this country greatly stimu lated interest in participation in the system among other nations. In response to this interest and pursuant to the national policy to establish the system in cooperation with other countries, a series of international discussions were held over the past several months. The Commission, together with representatives of the Department of State, the Communications Satellite Corporation and the communica tions common carrier industry, participated in a conference with repre sentatives of the European Conference on Posts and Telecommunica tions in Karlsruhe, Germany, in January of 1964. This meeting was followed by an exploratory discussion held in Rome, Italy, in Febru ary with representatives of the European Conference on Satellite Com munications and Canada. Further exploratory discussions and draft ing sessions in which the Commission participated along with the Department of State and the Corporation took place in London, Eng land, during April and May, as well as a meeting of traffic experts in Montreal, Canada, in April. These sessions led to a negotiating conference in London in June for the purpose of working out, in detail, arrangements with foreign governments and their respective telecommunication entities for par ticipation in the establislnnent and operation of the system as contem plated by the Satellite Act. In attendance were representatives of the United States, the European Conference on Satellite Communications, Australia, Canada, and Japan. As in othermeetings, the FCC assisted in the preparation of position papers. This conference produced documents which were satisfactory to all interests and represent a significant stridetoward realization of a global satellite communication system. Further meetings were held in Washington on July 21-23, 1964. At these sessions two separate agreements, one intergovern mental and one to be signed by designated communication carriers, were concluded. Ten countries signed in Washington on August 20, 1964, and other interested countries have a period of 6 months to sign. Worldwide Communication Traffic Statistics The Commission's representatives participated at a conference of the Satellite Communications Ad Hoc Group on Traffic at Montreal, Canada, April 27'-29, 1964. The meeting was attended by a group of 27' experts from several European countries, Australia, Japan, and Canada. It was convened for the special purpose of providing world wide communication trafficstatistie~both current and forecast tD 1968. FEDERAL COMl4UN1CATIONSCOMMlSS10N 19&4 ANNUAL REPORT 49 At the conclusion of the conference the agreed-upon statistics were for warded to the European conference and to appropriate officials in Australia, Japan, and Canada to serve as background material for subsequent international meetings relating to foreign participation in the system. TECHNICAL DEVELOPMENTS Experimental Programs The experimental programs of the "Telstar", "Relay", and "Syn com" satellites have continued to provide useful data essential to the establishment of a technically feasible global satellite system. On May 7, 1963, "Telstar II" was launched and continnes to operate on a daily basis. Two "Relay" satellites, developed by the Radio Corporation of America under contract with NASA, are presently in orbit and func tioning although "Relay I" has recently shown some deterioration. "Syncom II", developed by Hughes Aircraft Co. under contract with NASA, was successfully placed in near synchronous orbit over the South Atlantic in July 1963, and since that time has continued to op <,rate in a satisfactory manner. "Syncom II" was launched by NASA on August 19, 1964, into a nearly perfect synchronous equatorial orbit over the Pacific. One of its first tests was relaying live telecasts of the Olympic Games from Tokyo to the United States in October. The U.S. terminal for this experiment was operated by the Corporation at a southern California site pursuant to an FCC authorization of July 22, 1964. By using these several communication satellites it has been possible to conduct numerous experimental transmissions between ground sta tions in the United States and abroad. These experiments have been conducted through the joint efforts of the United States and certain foreign governments and communications entities whose cooperation was obtained through coordinated efforts of the Commission, the De partment of State, NASA, and private industry. Through such co operation, ground stations have been established in England, France, West Germany, Italy, Brazil, and Japan. The coordination so far ·effected has laid the groundwork for continued joint endeavor neces sary to the establishment of a truly global system of satellite commu nications as envisaged by the Satellite Act. The Commission, through its participation in the CCIR, is studying criteria for the sharing of frequencies without undue interference. Such studies, among other things, involve determinations of minimum separation distances between st.