Federal Communications Commission 31st Annual Report For the Fiscal Year 1965 With summary and notation of subsequent important developments UNITED STATES GOVERNMENT PRINTING OFFICE. WASHINGTON. 1965 For lal. by th. Superintendeat of Documents, U.S. Government Printing OIIc. Washington, D.C., 20402 - Price 50 cenl' COMMISSIONERS Member. of the Federal Communications Commission (As of June 30, 1965) E. WILLIAM fuNRY, Ohai'l'rTUJln (Term expires June 30, 1969) ROSEL H. HYDE (Term expires June 30,1966) ROBERT T. BARTLEY' (Term expired June 30, 1965) ROBEllT E. LEE (Term expires June 30, 1967) KENNETH A. Cox (Term expires June 30, 1970) LEE LOEVINGER (Term expires June 30, 1968) JAMES J. WADSWORTH (Term expires June 30, 1971) A list of present and past Commissioners appears on page IV. 1 Reappointed for a 7-year term to June 80, 1972. II LETTER OF TRANSMITTAL FEDERAL COMMUNICATIONS CoMMISSION, Washington, D.O., 20554. To the Oongre88 ofthe United State8: The 31st Annual Report of the Federal Communications Commis sion for the fiscal year 1965 is transmitted herewith. It contains information required by sections 4(k) and 315(2) (b) of the Communications Act of 1934, as amended; also by section 404 (c) of the Communications Satellite Act of 1962 concerning the Commission's responsibilities in the field of satellite communication. Of particular significance during the year was a reduction of $100 million annually in interstate telephone rates, the largest in history. Consideration of broadcast matters ranged from interpretations of the fairness doctrine to action to reduce the loudness of commercials. Mushrooming nonbroadcast radio services posed "housing" and oper ational problems for mobile and other users, and mounting radio violations--especially by individuals-taxed enforcement efforts. The overall electronic interference situation caused the Commission to ask for additional regulatory legislation. Because of the wide interest in community antenna television (CATV) systems, the report contains a separate chapter on that sub ject, also one on the Commission's relation to international telecom munications appropriate to the United Nations observance of 1965 as "International Cooperation Year." Highlights of the Commission's fiscal year are sununarized in the opening chapter of the report. Respectfully, E. WILLIAM HENRY, Ohairman. PAST AND PRESENT COMMISSIONERS Dern D.C. Dem__ .___ N.C_, Politics state DeDl Miss _ D.C _ iiX'-'-.-::::: Tex _ N.Y • __ Tex_ N.Y~__ D.C. _ Ohlo__ Ind Wash:===== Mlnn. _ N.Y . _ Maine _ N.Y _ Tex. __ Utah _ Wis . _ Ark_ Mlch_. _ m Dern _ Rep~::~:~=~ Dem _ Rep. _ Denl. __ Dem _ Ter'lml ojufrJice July 11,1934-Apr. 5,1939 July I1,1934-Mar. 8,1935 Rep~=======Ohio July 11,I934-June 30,1940 DeIlL Okls_.. July 11,1934-Juoe 30,1953 Nov. 3,1947-Dec. 28,1947 Feb. 28,1952-Apr. 17,1963 July 11,1934-June 30,1945 July 11, 19M-rune 30,1937 July 11,1934-June 30,1943 July I1,19M-Jan. 1,1935 Jan. 17,1935-Ju1y 23,1937 Mar. 9, \935--July 23, \937 Aug. 25,1937-June 30,1944 Oct. 1,1937-Au~.31,1939 Oct. 1,1937-Aug. 31,1939 Dem A\a Apr. 13,1939-June 30,1941 Dem______ Tex. .__ Sept. 1, 1939-Nov. 13, 1944 Sept. 1,1939-Nov. 13,1944 Mar. 22, 1941-June 30,19<;,7 Nov. 1,IMI-June 30,1948 Feb. 15, 1944-Dec. 31,1947 Nov. 16. 1944-Dec. 20,11)44 Dem______Ky.~~_____Dec. 21,I944-Feb. 25,1946 Dec. 2J.1944-Feb. 25,1946 Mar. 30, 1945-0ct. 31, 1947 Feb. 26,1946-Dec. 3,1946 Dec. 4, 1946-0ct. 31,1947 Rep~~=====:vi~~~_____July 23,1945-Mar. 6,1946 Rep Idaho Apr. 17,1946- Apr. 18,I1M3-Apr. 18,19054 Apr. 19, 1954-0ct. 3.1954 Apr. 10,194~-June30,1956 Sept. 5, 1947-Sept. 19,1952 Dec. 29,1947-Fcb. 21.1952 D~c.29,1947-F~b.2.1952 Jan. Z, 1945--Sept. 30,19054 July 6, 1948-June 30,1955 Mar. 6.1962- Oct. 14,1952-Apr. 14,1953 Apr. 16, 1953-Mar. 10,1960 July 1, 1957-Mar. 10,1960 Oct. 6, 1953- Oct. 4,19M-June 30,1957 Oct. 4,19M-June 30.1957 July 1,1955-Mar. 3.1958 July 2, 195&-Mar. 25,1963 Aug. 29. 1957-Dec. 31.1965 Mar. 15, 196o-Mar. 1,1961 May 23, 1958--Sept. 30, 1002 July 19,196o-Mar. 2, 1961 Mar. 2,1001-June 1.1963 Mar. 2,I00l-June 1,1963 Dem=~~==~=Tenn.. Oct. 2,1962 June 2,1963 Mar. 26, 1963 June 11,1963 May 5,1965- Rep: _ Dem . __ . Dem. _ Dem~_ Rep••~ Rep== _ fu,p . __ Dem~==:~=- Rep. _ Dem _ iiep~_ Detn _ Ind. _ Dem _ Dem _ Rep _ iD(C~~~=~:= Rep _ Dem_ .. _ Dem _ Dem ._ Rep__ Commkdoner8 -Eugene O. Sykes • 0 _ Chairman.• . _ *Thad H. Brown . ._ ·Paul A. Walker _ Acting Chairman. _ Chairman • . _ -Norman S. Case _ Irvin Stewart._" _.~_ *George Ilenry Payne_ •• . >_ -Hampson Gary _ •Arming S. PraIL . . _ Chairman. __ • _ T. A. M. CraveD _ *:I<'rank R. McNinch _ Chairman _ *FredBrick L Thompson _ James Lawrence Fly _ Chairman_. _ ·Ray c. Wakefield .<~_ Clifford r. Durr~. _ ·Ewell K, Jett~• Interim Chairman~_ Paul A. Porter~_ Chairman •~_ Charles R. Denny • _ Acting Chairman . _ Chairmau~_ *William H. Wills_. _ Rosel H.Hyde._~_ Chalrman~_ Acting Chainnan _ Edward M. Webster . _ Robert F. Jones.~_ ·Wayne Coy • _ Chairmau . _ George E. Sterling • _ ·Frelds B. Hennock • _ Robert T. Bartley _ Eugeoo H. MerrteU _ John C. DoerfeL 4 _ Chairman _ Robert E. Lee __ c _ Goor~at~~~?_~~~_~~~::::===::::==:= ======== *Richard A. Mack___ _ _ T. A. M. Craven _ Frederick W. Ford. . __ Chairman__ •• . _ John S. Cross. _ Charles H. Kfng . . _ Newton N. Mlnow _ Chairman _ E. William Henry ..~, Chairman.~. _ Kenneth A. Cox____ __. _ LeeLoevinger~_________~._~_ JamesJ. Wadsworth_____ _ _ -Deceased. IV Table of Contents Pan REPORT SUMMARY______________________ ____ __ ____ ___ 1 COMMISSION___ _____ ____ __________ ______ ____ _____ 10 Organization chart • • .___ 9 Regulation •~•• • 10 Commissioners. __ • •• • • ••__ 10 Commission staff • • __ • • ._.__ _ 11 Personnel • • • __ . ._ __ 11 Appropriations and expenditures. • . • _._ 12 Electronic computer system • . • ___ 12 Application filing fees. • • . ._ 13 Hearing examiners. • • • ._ 13 ])ockem~__________________________________13 Authorizations ____ ____ _____ __ _____ __ ___ __ ____ _______ __ __ 16 Applications~___ ___ __ ____ ___ __ _____ __ 16 Rules on ex parte communication~________________________16 Technical assistance to foreign experts_ _____ __ _______ ____ __ __ _ 17 Correspondence~________________________17 Releases and publications~_____ _____ __ __ __ _____ ___ 17 LAW AND ENFORCEMENL______________________________ 19 Legislation • _____ ___ __ _____ __ _ __ __ _______ 19 Legislative activity~__ __ __ __ ___ ___ 19 FCC legislative program____________________________________ 19 Other bills affecting the FCC~__ __ 20 Congresmonal hearings~______________20 Litigation~._ _ 21 Decisions of special significancc______________________________ 21 Statffitics~____24 Enforcement~____25 NATIONAL DEFENSE- ___ __________ __ ______ __ _ 26 General______________________________________________________ 26 Emergency Broadcast System__ __ __ ___ __ ___ __ __ ___ __ _ 27 Fallout protection for AM and FM stations~____28 Common carrier priorities ________ _______ __ _____ __ ___ __ __ __ ___ __ 28 Resourcedata_________________________________________________ 29 Safety and special radio services_________________________________ 29 FCC Industry Advffiory Committees_____________________________ 29 Other emergency planning cooperation___________________________ 30 National Defense Executive Reserve_____________________________ 30 FCC mobilization planning officer_______________________________ 31 V VI TABLE OF CONTENTS Pa.. INTERNATIONAL COOPERATION________________________ _ 32 IntroducUon__________________________________________________ 32 International conferences .____ __ __ ___ _ 33 International telephone and telegraph____________________________ 34 SatellitecoDlDlunicaUoD________________________________________ 35 International marine radio____ __ _____ ____ ___ __ ______ __ __ __ __ _ 36 International aeronautical radio. ._____ __ __ __ _ __ 36 International amateur radio communication_______________________ 37 International broadcast. • __ • _ 37 Search and rescue assistance. _. __ •~_ 37 Special monitoring programs__________ ________ __ ___ ____ 37 International infringement reports~38 International interference O8ses_______ __ __ __ __ ____ __ __ 38 International frequency usage data_ ____ __ __ ___ __ __ __ ___ __ 38 Technical assistance to foreigners________________________________ 38 Radio operation by alieos_______________________________________ 39 SATELLITE COMMUNICATlON__ 40 Cleneral______________________________________________________ 40 Commercial communications satellite system established____________ 41 ComSat revenues placed in "deferred credit" BccounL_____________ 41 Earth station ownership____ __ __ __ __ _ 42 Authorized user-authorized entity proceedings_____________________ 43 Procurement activities_ _ __ ___ ____ __ ___ _ 43 Live TV broadcast of Olympic Games from Tokyo_________________ 44 Commission ends restriction on sale of stock______________________ 44 Overseas carriers use of Early Bird channels______________________ 45 Technical developments_____________ ____ ____ ____ __ ______ _______ 45 International negotiations_ _ __ _________ __ __ _____ ____ __ __ 45 Arbitration agreement_____ __ __ ________ ___ __ ___ _______ ______ 46 Interim committee__________ __ _________ _____ _________ ______ 46 COMMON CARRIER SERVICES_____________________________ 47 Domestic telephone___ ___ __ __ __ __ __ __ __ __ __ 47 General__________________________________________________ 47 Telephone services and facilities p __ _ _ __ __ 48 Informal service complaints and docket cases_ _____ __ _______ __ 49 AcqureitioDS______________________________________________ 49 Tariff docket caSeB_____ __ _____ __ _________ __ __ __ __ __ __ 49 I\nvateline___________________________________________ 49 WATS_ __ __ ___ __ __ __ __ __ __ ____ __ __ __ 49 TELPAK_ _____ ____ _______ ____ __ _____ 50 TWJ{________________________________________________ 50 Press private line rates_________________________________ 50 ~evvtarUf._______________________________________________50 Depreciation______________________________________________ 51 Accounting_______________________________________________ 52 Rule cbangeB_ _ __ __ __ __ __ __ __ __ _____ __ __ 52 Other accounting matters_______________________________ 53 Relief and penslons____________________________________ 53 TABLE OF CONTENTS COMMON CARRIER SERVICES-Continuec:l vn Pa.. Domestic telegraph~•~• 54 (}eneral__________________________________________________ 54 Domestic telegraph rate increase ._______ 54 Telegraph services and facilities. • __ __ 55 Modernization and expansion___________________________ 55 Extension of lines and curtailment of service______________ 55 Speed of service_______________________________________ 56 EXpanding services... _.. ._ __ 57 New domestic telegraph services 57 Broadband Exchange Service___________________________ 57 Short Period VDice Transmission Service............. _~__________ 58 Flat-rate Greeting Message Service~_______________58 Tariff schedules~__________ 59 Accounting matters~_ __ __ _ 59 Field review_~~~~__ _ 59 Premature plant retirements~~__________59 Income taXeB_____ __ __ _ __ __ ___ __ __ ___ ___ _ 59 Investigation of domestic telegraph service~_______________59 Domestic common carrier radio facilities~_______________60 Common carrier microwave radio services____________________ 60 Domestic public land mobile radio Bervice~_______________60 Air-ground radiotelephone service~_• __~~___ __ __ ___ 61 Domestic common carrier forrns_____________________________ 62 Overseas telegraph and telephone~_______________62 General__________________________________________________ 62 Financial position of industry~__________62 Intra-governmental telecommunications study __ ___ __ _ 62 Services and facilities_ _ __ __ ___ __ _ 63 New cables authorized~~~_____63 Proposed abandonment of cables~_____63 Use of cables by telegraph carriers_______________________ 63 Reorganization of American Cable & Radio Corp__________ 64 Transfer of control of Press Wireless .. 64 High frequency radio circuits~. 64 Rates and revenue ma.tters_________________________________ 65 Rates for overseas services~~65 Overseas rate study~~65 Voice--dat3 service with lIawaii._________________________ 65 Pan American complaint •~65 ITT matters_______ __ __ __ ____ _ 65 WUI matters_ _ _ __ 66 Western Union Telegraph Co. petition___________________ 67 Tariff schedules~__________________ _ __ _ 67 Accounting matters~~67 Review of carriers' practices .. • • 67 WUI accounting practices~____ _ 67 Depreciation~•~68 Ilule changes . 68 VIII TABLE OF CONTENTS COMMON CARRIER SERVICES-Continued Pace Statistics_ __ __ ___ __ _______ ________ __ __ _______ ___ ___ ______ _____ 68 (}~neral__________________________________________________68 Telephone carriers__ _____ ___ __ __ __ _____ __ ___ __ __ _____ 68 Domestic telegraph carrier ___ _________ __ ___ __ _________ 70 Overseas telegraph carriers_____ ___________ __ ___ _______ __ ____ 70 Overseas message telecommunications services____ _____________ 71 Common carrier radio authorizations_________________________ 76 Common carrier applications~___________ ________ _____ 77 CATV SYSTEMS___________________________________________ 78 How they started____ ____ _____ __ ___ ____ __ _____ ___ __ __ __ _____ 78 IIow they operate________________________________________ 78 Growth of CATV______________________________________________ 79 Costs of CATV ______ _______ _______ __ ___ _________ ___ 79 CATV competition to TV stations_______________________________ 79 CATV regulation__ ____ __ ___ ________ _______ __ ____ __ __ _______ 80 FCC actions in CATV field_____________________________________ 81 BROADCAST SERVICES___ __ __ __ ______ _____ _ ______ ___ 85 Political broadcasts__ __ ___ ______ _________ __ _____ _________ 85 Section 315 considerations__________________________________ 85 1964 political broadcastexpenditures~________________________88 Broadcast of controversial public issues___________________________ 89 Broadcast advertising_ __ __ _____ ____ _________ ___ ___________ 92 Loud commercials____ _________ ________ ___________ 92 Double billing____ __ ___ ___ ___ __ _______ __ ___ _____ ________ 94 Broadcast programing____ ____ ___ _____ __ _______ __ ___ __ _______ 94 TV network programs_____ __ ______ _____ _________________ 94 Proposal to limit network interest in TV programs_________ 94 Making network programs more widely avaiIablc__________ 95 Part II of TV network program procurement report___________ 96 Revision of aural program reporting form_____________________ 96 Broadcast of horse racing informatioll________________________ 97 Multiple ownership - - _- - - - - - _- ________ 98 Amendment of "duopoly" rules-____________________________ 98 Restrictions on TV acquisition in large markets_______________ 99 Holdings in widely held corporate licensees___________________ 99 Comparative criteria in broadcast hearings________________________ 100 Financial qualifications of new applicants_________________________ 102 License renewals~~___ 102 Keeping of pUblic file.5 by broadcast stations______________________ 103 Broadcast station sales__ _____ __ __________ ________________ 103 Tall antenna towers_____ ___ ____________________________________ 104 Enforcement__________________________________________________ 105 Complaints and other public commenL__________________________ 105 Compliance___________________________________________________ 105 TABLE OF CONTENTS BROADCAST SERVICES-Conlinu"d IX Page sanctiOllS_____________________________________________________ 106 Revocation and renewal proceedings_________________________ 106 Short-term licenses_ ____ _________ _______ ______ __ ___________ 108 Forfeiture proceedings_____ _______________ __ ______ __ _______ _ 108 Sorne developments after sanctions__________________________ 109 Television (TV) broadcast service_______________________________ 110 UHF development- - - - -_ - - _- __________ 110 Advisory committee on UHF___________________________ 110 UHF allocations____ __ _________________________________ 111 "Idle" UHF authorizations_____________________________ 112 VHF assignments____ ______________________________________ 112 Educational TV - ______________________ 112 Airborne ETV 113 Instructional TV fixed service~__114 Subscription TV______ ___ __ __ _____ __ 114 TV translators~_____________________________________ ______ 115 Color TV - - ___ _______________ ____ 116 TV stereophonic sound~__ 116 Frequency modulation (FM) broadcast service____________________ 116 FM expansion - __________ ____ ___ ____ _ 116 FM channel assignments___________________________________ 117 Improvement in existing stations-~__ 117 Interference consideratioIlS_____ __________ _______________ 118 Limitation on FM-AM program duplicatioll__________________ 118 Educational FM____ ____ _________________________________ __ 119 Standard (AM) broadcast service_______________________________ 120 AM rules revised__________________________________________ 120 Emergency AMoper~tion~__120 International broadcast statiollS__ _______ _________ ________ _______ 121 Miscellaneous broadcast services_____ _______ _____________________ 121 Statistics__ __________________ __ _________________ ______________ I'll Current broadcast authorizatiollS_ ___________________________ 121 Status of broadcast authorizatioIlS___________________________ 122 Broadcasting since 1949____________________________________ 122 Broadcast applications_ ________________ ________________ __ __ 124 Broadcast industry financial data____________________________ 127 SAFETY AND SPECIAL RADIO SERVICES-____________________ 133 General______________________________________________________ 133 Regulatory developrnents_______________________________________ 133 Enforcernent__________________________________________________ 134 Marine radio services_ ____ __ _____________ __ __ ___ __ ______ __ _____ 135 Safety at sea______________________________________________ 135 Safety of Life at Sea Convention________________________ 135 Bridge-to-bridge communication study____ __ _____________ 135 Disposition of ship exemption applications________________ 135 Distress studies ___ _____ __ _____ __ __ __ _ __ _ 136 Radio Technical Commission for Marine Services (RTCM)_____ 136 x TABLE OF CONTENTS SAFETY AND SPECIAL RADIO SERVICES-Conlinued Pac· Marine radio services-Continued Marine radio communication systems________________________ 137 Rule amendmcnts_ ________ __ __ __ ___ _______________ _ 137 New coast stations_____________________________________ 137 Closure of statioll______________________________________ 138 Radio communication in Alaska_________________________ 138 Aviation raillo services___ ___ _____ __ ____ __________________ __ _ 138 General__________________________________________________ 138 Committee and conference participation______________________ 138 New developments and rule changes.________________________ 139 Public safety radio services_ ______ __ __ ____ ___ _______ __ ___ _______ 140 General__________________________________________________ 140 New developments and rule changes_ 141 Land transportation radio services_______________________________ 141 General__________________________________________________ 141 New developments and rule changes_________________________ 141 Industrial radio services__ ___ _____ __ ___ _________ _______ __ _ 142 General__________________________________________________ 142 New developments and rule cbanges_________________________ 142 Citizens radio service_ ____ ___ ___ __ ___ __ _____ ______ 143 Amateur radio service___ __________ __ __ _________________________ 143 General__________________________________________________ 143 New developments and rule changes_________________________ 144 Disaster communications service .__________ __ __ ___ _____ ____ 144 Statistics________ __ ___ __ __ __ __ __ _____ ___ ____ ___ 144 Stations in safety and special radio services___________________ 144 Transmitters in safety and special radio services. r .____________ 146 Applications in safety and special radio services_______________ 147 Enforcement sanctions in safety and special radio services______ 148 FIELD ENGINEERING_ _ _ _ __ 149 General______________________________________________________ 149 Mobile monitoring____ __ ___ __ __ __ _________ ___ ___ __ __ 150 Radio direction finding___ _ __ __ ______________ __ ______ _ 150 Long-range interference eliminatioD___ __ __ ______________ __ ___ 150 Monitoring enforcement and Class D citizens radio________________ 151 Network and mobile unit intercommunication..~___________________151 Search and rescue _.. _ __ __ __ __ __ ______ 152 Contractual work_____ ___ __ __ __ _____ __ __ __ 152 Field technical and plant facilities_______________________________ 152 Facilities at fixed monitoring statioIlS________________________ 153 Property facilities_ __ __ __ __ __ __ ___________ 153 Technical facilities r r __ _ __ __ __ __ __ 153 Mobile monitoring facilities_____________________ __ __ 154 Mobile facilities for engineering measurements_ r _ _ __ 154 Facilities for investigative activities__________________________ 155 MObile FM-TVenforcement units___________________________ 155 Mobile microwave monitoring units__________________________ 155 Field office enforcement ___ ___ __ __ __ __ ___ 156 ~arine_______________________________________________________156 TABLE OF CONTENTS XI Pa.. FIELD ENGINEERING-Continued Broadcast____________________________________________________ 157 Interference investigation •• • 157 Radio operator examining and licensing. __ __ ____ __________ __ __ 158 llntennahazards__ • .____________________________ 160 Field engineering offices and monitoring statioDs___________________ 160 Stat~Mcs_____________________________________________________161 Inspection statistics... __ __ __ __ __ _ 161 Investigative statistics_ ___ __ __ __ ____ ______ __ __ __ __ _ 162 Monitoring statistics__ __ ____ __ __ _____ __ ______ ______ _ _ 162 Commercial radio operator liceD£es__________________________ 163 Applications processed by Antenna Survey Branch_____________ 163 Applications requiring aeronautical study by Federal Aviation Agency_________________________________________________ 163 RESEARCH AND LABORATORY 164 Technical_____________________________________________________ 164 Technical standards for licensed equipment___________________ 164 Regulation of nonlicensed radio devices_______________________ 165 Radio experimentation__ - - - - -_ ____ ____ _ 166 Type acceptance__________________________________________ 166 Technical standards studies___ __ __ __ __ __ __ __ 167 Research_____________________________________________________ 167 General__________________________________________________ 167 Radio propagation and service_____ ___ __ __ __ __ __ ____ __ 168 Data processing techniques_ __ ____ ___ __ __ ____ ___ __ __ 169 Research reports - - _- - - - - - - - - ______ _____ __ 169 Laboratory___________________________________________________ 170 Research and development__________________________________ 170 ~arineraclio______________________________________________ 170 Aid to Commission enforcement and monitoring activities______ 171 Calibration of measurement equipment_______________________ 171 UHF-TV__ ._ __ __ __ __ ___ __ __ __ __ ______ __ __ __ __ 171 Typeapproval____________________________________________ 171 Channel occupancy and automated monitoring________________ 172 FREQUENCY ALLOCATION AND USL___________________ 173 General .__________________________________________________ 173 National frequency allocations .____ __ ________ __ ____________ __ 173 National frequency coordination____ _______ __ ____ ____________ __ __ 174 National non-Government frequency lists_________________________ 175 International frequency allocations • - - _- - - - - _- ______ __ 176 International frequency registration_____ __ ____ __________ _______ __ 176 International frequency coordinatioD_____ __ __ __ __ ____ __ ____ ___ 176 International interference and infractioDs_________________________ 117 International frequency usage monitoring data____________________ 178 International conferences - - --- - ---- __ -~__ __ 178 Callmgns_____________________________________________________ 179 APPENDIX________________________________________________ 180 FCC log highlights of 1965 fiscal year .______________ 180 Report Summary GENERAL United States leadership in the use of radio is evidenced by the now more than 5 million transmitters Ecensed by the Federal Communka tions Commission. They are employed for a host of purposes which range from probing the ocean depths and for discovering underground oil deposits to relaying communication services by satellites and for exploring outer space. Domestic electronic communication has advanced a long way from the wire and "wireless" days of a half-century ago when news was made by such events as President Wilson opening the Panama-Pacific Exposition with a radio signal, inauguration of the first transconti nental telephone line, the sending of the first transatlantic radiotele phone caU, testing radio for police nse, David Sarnoff envisioning a "radio music box," and l\farconi predicting "visual telephone." Today radio has become an invaluable tool to the Nation's com mercial and pubEc services, as well as its scientific endeaVOl'. Nearly 1.5 million non-Government radio stations operate on or above the earth's surface, for which over 3 million radio operator authorizations are required. Highlights of FCC activities, by categories, during the year follow: NATIONAL DEFENSE Under Presidential direction, the Commission is charged with coor dinating its licensed communication services to the national defense program. Chief among these is an emergency broadcast system which furnishes a means of speedily reaching the general public in time of national attack or other emergency. The President is provided 63 points throughout the United States from which to broadcast to the Nation in time of crisis. More than 2,300 broadcast stations are par ticipating. Over 200 stations have been furnished fallout shelters. The FCC defense program also covers emergency operation by nonbroadcast radio services, common carrier systems, protection of 1 2 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT communication facilities and, in substance, developing "a state of readiness in these areas with respect to all conditions of national emergency." In this work it cooperates with other Federal agencies concerned and is assisted by industry advisory committees (national, 8 regional and 50 State), also by an FCC unit of the National Defense Executive Reserve. INTERNATIONAl. COOPERATION Review of FCC participation in international telecommunication matters, in connection with the 1965 "International Cooperation Year," showed that U.S. teamwork with other nations ranges from coordination of frequency allocations for mutual radio usage, and exchange of related data, to supporting and strengthening interna tional pacts for orderly operation. This collaboration now extends to satellite communication. During the year, the Commission prepared for 42 related inter national conferences and participated in 28, furnishing chairmen for U.S. delegations to7 sessions. SATELLITE COMMUNICATION Satellite communication developments saw the inauguration of the first commercial service, via Early Bird, positioned over the Atlantic, after the Commission had authorized overseas carriers under its juris diction to lease channels for that purpose. Previously, Syncom III stationed over the Pacific was used to bring live TV broadcast from the Olympic Games in Tokyo. Pending an investigation of tariffs of the Communications Satel lite Corporation, the Commission ordered revenues from satellite oper ation placed in a deferred credit account. The Commission gave interim authority to the Corporation to oper ate three initial earth stations and initiated inquiry whether non common carriers can be satellite customers. By the yearend, seven communication satellites were in orbit, in cluding the pioneer Echo balloon and other early test space vehicles. Nearly 50 countries had signed pacts to participate in a global commercial communications satellite system. An Interim Communications Satellite Committee, responsible for planning of the design, development, construction, establishment, maintenance and operation of the space segment of the system, has been established, with ComSat as the U.S. designated member. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 3 COMMON CARRIER Telephone As an outgrowth of the Commission's regulatory surveillance of the telephone industry, substantial reductions were effected in evening "after 8 p.m." and all day Sunday rates for interstate long-distance telephone calls, resulting in saving the public more than $100 million annually. This is the largest such rate reduction to date. On the 50th anniversary of transcontinental telephone service, construction of a blast-resistant coast-to-coast telephone cable was completed. The first Bell System commercial electronic central office was opened. The number of telephones reached 88 million. The Bell System's total earnings in 1964 amounted to $1.8 billion, representing a return of 7.6 percent on a net investment of$23.8 billion. The Western Electric Co., Bell's manufacturing subsidiary, as well as the Automatic Electric Co., manufacturing subsidiary of the Gen eral Telephone System, reduced substantially the prices on their manufactured products which they sell to their respective systems. In 1964, plant investment of the telephone industry increased by $3.1 billion, 4.3 million additional telephones were installed, long distance calling increased by about 9 percent over the previous year and approximately 53 percent of all such calls were being dialed directly. Pushbutton dialing (Touch-tone) was provided in about 200 communities and is now used by about 450,000 subscribers. The Commission authorized about 350-telephone-construction proj ects, amounting to almost $353 million. The Commission received new A.T. & T. tariff schedules providing changes in rates applicable to calls between Alaska and the rest of the continental United States, which will result in overall savings to users of about $1.1 million annually. Telegraph Western Union expanded its new transcontinental microwave system. The Commission's domestic telegraph investigation progressed to the point of preparing recommendations for the consideration of the Telephone and Telegraph Committees. Notwithstanding the continued public message volume decline, total operating revenues of Western Union in 1964 reached ahnost $300 million, exceeding those of the previous year by over $12.5 million. Western Union's gross plant increased to $635 million as compared to about $597 million in 1963. 4 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT The telegraph company fnrther expanded the Autodin system for the Department of Defense, and it has nearly completed installation of the Advanced Record System for the General Services Administra tion, to serve the civilian agencies of the Federal Government. Western Union's new Broadband Exchange Service waS inaugu rated in 20 major cities. This service enables its subscribers to select from several transmission band,vidths to meet voice, facsimile or high-speed data requirements. Other new services were an intercity private line business telephone service ("Hot Line"), "cigargram" and "dollygram" services, a floral order service, and a flat-rate greeting Inessage service. Overseas New records were set in revenues fronl overseas telephone and telegraph services. Additional ocean cables were authorized-one to connect the Virgin Islands with Venezuela and another to link Guam with the British Pacific cable system. A special intragovernmental committee is studying U.S. external telecommunications. During the year, the Commission also authorized A.T. & T. and several international common carriers to lease voice channels in the satellite "Early Capability System" and to provide over such satellite channels their regularly authorized services. The Commission in June 1965 authorized A.T. & T. to extend its voice·data service to flaw-aii, enabling users to transmit data over regular telephone circuits at the same rates as telephone calls. 'Vestern Union International, Inc., was authorized to acquire facili ties in the new Pacific cable systems in order to serve the Philippines directly rather than through London or Australia, as heretofore. The Commission consented to the transfer of control of Press Wire less, Inc., to ITT"\Vorld Communications, Inc. CATV SYSTI1MS The Commission tentatively concluded that it has jurisdiction over all CATV operations and proposed to extend certain requirements on microwave-served CATV systems to those not using radio relay. It also initiated an inquiry into various questions posed by the rapid development OT CATV. It reaffirmed its view that CATV is not a common carrier operation, to which a court appeal was later taken. A separate inquiry into joint ownership of CATV systems and TV stations did not disclose abuses to warrant a ban on such croSS-owner- FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 5 ship but the Commission warned of future action if individual cases warrant. It published a special economic survey of CATV operations which showed ,.;bout 1,'700 snch systems serving over 4% million eustomers. BROADCAST During the year the Commission: Enforcement Revoked the license of 1 broadcast station and denied renewals to 12 others; held 38 stations liable for forfeitures and put 21 stations on short-term probationary licenses. Received more complaints about programing than any other broad cast subject with advertising a close second. Programing Announced a policy which requires stations and advertising pro ducers to take steps to curb objectionably loud commercials. Proposed rules to limit network interest in TV programs, and to make network programs more widely available. Revised its aural broadcast application form to require more infor mation about programing intent and practice; one for TV is in preparation. Formed an advisory committee on the broadcast of horse racing information. Published the second part of its staff study of TV network program procurement. Issued a supplement to its political broadcast primer, reported about $35 million spent in the 1964 campaigns, and handled various com plaints on political and other fairness issues involving broadcast. Monopoly Amended its rules to ban common interest in aural and TV stations which have specified signal overlap. Proposed to limit common ownership of TV stations in the top 50 markets. Instituted inquiry into whether corporate licensees have interest in more than the allowable number of stations. General Issued a policy statement on criteria considerations in competitive broadcast hearings. Adopted rules requiring stations and applicants to maintain public files locally. 789-224--66----2 6 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT Other Matters TV.-The all-channel TV set requirement has spurred new UHF sta tion applications and is otherwise contributing to UHF development. Commission promotion of UHF is aided by a special industry advisory committee. The Commission revised its table of UHF channel assign ments. It also proposed a new low-power "community" type station to operate on the upper UHF channels. It took steps to get "idle" UHF permittees to operate orvacate. Nearly every major city now has at least one educational TV station. Channels reserved for education have increased to 621. A special serv ice on nonbroadcast bands is assisting ETV by relaying instructional material. Though denying a request by the Midwest trial airborne ETV operation for regular service on TV channels, the Commission indicated that the activity could be accommodated in the nonbroadcast band now used for instructional purposes. The Commission extended the test subscription-TV authorization of WHCT(TV), Hartford, the only station offering such service over the air. A petition looking toward nationwide pay-TV broadcast is under consideration. The Commission does not now license or other wise regulate cable pay-TV but is studying those activities. Aural.-Applicable to jointly owned FM and AM stations in large cities, the Commission limited duplication of AM programs by the FM stations to not more than 50 percent of the FM stations' broadcast time. The AM station assignment rules were revised to lift the interim "freeze" on applications for new or changed facilities in that service. Interest in and expansion of FM broadcast continued under the 1963 rules which established an assignment table for commercial channels. That portion of the proceedings which contemplate an assignment plan for educational stations will be culminated shortly. Miscellaneous.-The Commission, in cooperation with the Federal Aviation Agency, proposed establishing "antenna farms" for group ing tall transmitting antennas which might endanger air navigation. Over 175 TV towers, present or proposed, exceed 1,000 feet in height. The tallest operating antenna is the 2,063-foot shaft of KTffi-TV, Fargo, N. Dak. The highest price yet paid for a single broadcast station----$20.5 million-was involved in the sale ofWnC(TV), Pittsburgh. SAFETY AND SPECIAL RADIO Radio usage in the nonbroadcast services (other than common carrier) reached a new high of nearly 1.5 million licensees and over 5 million transmitters. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 7 Because of such extensive operations, rule violations were many. Revocation proceedings were instituted against over 200 safety and special licenseees and nearly 200 others incnrred forfeiture actions. The citizens radio service, with about 745,000 licensees, had the most violators. The problem of finding more frequencies for expanding mobile operations resulted in more channel splitting and received intensive attention by a special advisory committee. Eligibility in the local grovernment radio service was broadened. Railroad radio was being automated with tone transmitting devices. The amateur year featured the orbiting of a satellite for "ham" use exclusively. FIELD ENGINEERING The Commission's monitoring network furnished nearly 900 bear ings on ships and planes in distress, identified over 70,000 questionable signals, reported on 13,000 interference and other cases and issued over 24,600 discrepancy notices. There was field investigation of over 25,000 interference and other cases. Nearly 950 unlicensed radio operations were uncovered by monitor ing and investigative means. Inspection made of more than 18,000 radio stations (7,100 ship, 2,100 broadcast and 9,000 other) resulted in approximately 10,000 violation notices. Field offices issued more than 175,000 radio operator authorizations and processed 28,700 antenna proposals, of which latter number nearly 27,000 were for the nonbroadcast services. Field contractual work was performed for other Federal agencies on a reimbursable basis. INTERFERENCE In connection with interference from the plethora of radio frequency devices, the Commission proposed further controls for such operated garage-door openers and intruder alarms. In one area nearly 300 garage-door openers had to be removed from service because their uncontrolled emissions invaded and jeopardized aviation radio communication. The Commission continued its preventative program of giving type approval (after tests at its laboratory) and type acceptance (on sub mission of technical data) of certain equipment prior to its manufacture and use. 8 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT LEGISLATION AND LITIGATION Purchasers of radio and TVsets and users of loug-distance telephone service benefited from repeal of the excise tax. FCC legislative pro posals included request for authority to regulate devices which cause radio interference, and to require marking or dismantlement of aban doned transmitting towers in the interest of air navigation safety. It also testified on a previous proposal to curb electronic eavesdropping. The Commission was a party to 91 cases in the Federal courts. The Commission referred to the Department of Justice seven for feiture cases-including one refusal of a broadcasting station to pay; also eight cases for criminal prosecution. COMMISSION Commissioner James J. Wadsworth succeeded Frederick tV. Ford, resigued, and Commissiouer Robert T. Bartley was reappointed. The Commission operated with a budget of nearly $17 million and almost 1,500 regular employees. Since being instituted in March 1964, FCC application fees in excess of $4.6 million were collected. In its first full year of operation, the Commission's electronic com puter speeded the processing of certain applications and furnishing engineering and other data. At the yearend, outstanding radio station and operator authoriza tions together totaled nearly 4;,!, million. Applications received dur ing the year exceeded 775,000. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 9 FEDERAL COMMUNICATIONS COMMISSION Organization Cha'rt as of June 30, 1965 THE COMMISSION I CHAIRMAN I \ OFFICE OF OFFICE OF OFFICE OF THE SECRETARY EXECUTIVE DIRECTOR HEARING - - Minute & Rules Division Budget & Fiscal Division EXAMINERS Dockets Division Manpower Utilization & Technical Assistance Survey Division Division Data Processing Division OfFICE OF Library Division Office Services Division Mail & Flies Division OPINIONS AND 1- Office of Emergency REVIEW Communications I Office of Security - OFFICE OF REPORTS I l- AND INFORMATION REVIEW BOARD OFFICE OF OFFICE OF CHIEF ENGINEER GENERAL COUNSEL - Technical Division Litigation Division - Research Division Legislation DIvision Frequency Allocation Administrative Law & & Treaty Division Treaties Division Laboratory Division Enforcement & Defense Dlvialon BROADCAST BUREAU COMMON CARRIER BUREAU Office of Network Study Office of Satellite Communications Broadcast Facil1ties Division Office of Planning & Special Projects - - Rules & Standards Division Services & Facll1Ues Division Hearing Division Rates Division Renewal & Transfer Division International Division Complaints & Compliance Division Iffimestic Radio Division Research & Education Division Accounting Division LIcense Division SAFETY AND SPECIAL RADIO FIELD ENGINEERING BUREAU SERViCES BUREAU Field Offices Division - Legal, Policy & Enforcement Office Engineering .\ Facilities Division - Aviation Radio Division Monitoring Systems Division Amateur & Citizens Radio DIvision Marine Radio Division Industrial Radio Division Public Safety Radio Division Commission REGULATION The Federal Communications Commission regulates all non Government radio operations, also interstate and overseas communi cation common carrier services. It was created by Congress in 1934 to unify then divided Federal supervision in this field. Subsequent added responsibilities given the FCC now include extension of its authority over common carriers to satellite communication relay. In general, the Commission assigns frequencies for the different radio services, licenses radio stations and the operators of their trans mitters, regulates overseas and long-distance (but not intrastate) tele phone and telegraph services, promotes new and more effective use of radio, with emphasis on its utilization to protect life and property and harnesses radio and wire facilities to the national defense program. The Commission derives its main authority from the Communica tions Act of 1934, as amended, augmented by the Communications Satellite Act of 1962 with respect to space communication. Its practices conform to the Administrative Procedure Act and other applicable laws. COMMISSIONERS The seven FCC Commissioners are appointed by the President sub ject to Senate confirmation. They supervise all Commission activities, with delegations of responsibilities to boards and committees of Com missioners, individual Commissioners, and staff units. The Chairman, who is so designated by the President, is responsible for administration of the internal affairs of the Commission. All policy determinations are made by the Commissioners as a body. Commissioner Frederick W·. Ford resigned as of December 31, 1964, and James J. Wadsworth was, on March 25 thereafter, nominated by President Johnson to fill out Commissioner Ford's unexpired term ending June 30, 1971. Confirmed by the Senate on April 28, 1965, Commissioner Wadsworth took office on May 5. On August 23, 1965, Commissioner Robert T. Bartley was renomi nated by President Johnson for another 7-year term, from June 30, 1965. He received Senate confirmation on September 2. 10 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 11 April 17, 1965, marked attainment by Commissioner Rosel H. Hyde of 19 years of service as an FCC Commissioner, the longest in the Commission's history. COMMISSION STAFF The Commission's staff is organized into functional bureaus and offices. There are four operating bureaus-Broadcast, Safety and Special Radio Services, and Common Carrier, administering to those respective services, and Field Engineering, for monitoring, inspection, investigation and other technical duties in the field. Hearing examiners preside at hearings and issue initial decisions. A Review Board acts on certain adjudicatory cases and appeals from interlocutory rulings of hearing examiners, also their initial decisions. An Office of Opinions and Review drafts decisions for and at the direc tion of the Commission as a body. Other FCC units are the Offices of Secretary, General Counsel, Chief Engineer, and Reports and Information, with duties as implied in their titles. FCC staff activities are coordinated and expedited by an Executive Director. An organization chart of the Commission and its bureaus and offices, including their divisions, precedes this chapter. PERSONNEL The Commission had 1,541 employees at the close of fiscal 1965. In cluded were 36 employed for the summer months only and 43 per forming work for other agencies on a reimbursable basis. The actual average employment for the entire year for staff engaged in "regular" Commission activities was 1,477.8. This represents an increase of 28.5 over 1964. The average employment for the various organization units was: Washington FIeld Total Com.m1ss:loners'omcea..~._•. ._.__________________ 46. 7 0 441.7 Review Board. • ._.__ .. 29.8 0 29.8 Office of Opinions 8.Ild Review . .______________________ 15. 8 0 Hi. 8 Office of HearIng Examiners______________________________________ 33.li 0 S3.li Offioo of Reports and Information. ._________________________ •. D 0 4. 9 Office of Executive Director._____________________________________ 179.0 4. 0 183.0 Office of Secretary ._0_. .________________________________ 35.6 0 35.15 Office of General CounseL~~~~_________________4l5.15 0 4.5.15 Office of Cbief Englneer•• 72. 8 17.0 89.8 Common Co.rr1er Bureau_ 136.2 26. 2 162." Safety and Spooial RadIo Services Bureau__~_____________________156.1 15.8 171. 9 Broadcast Bureau~~_~~___________252. 9 0 2li2. 9 Field Engineering Bureau I _-,:-::64.;:-:-6 1__341.::,,:-'I_--:-..:"",~.l TotaL ..~..~_~_______1,073. 2 404. 6 1.471.8 12 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT APPROPRIATIONS AND EXPENDITURES The Commission's appropriation for fiscal 1965 was $16,985,000. Personnel compensation plus personnel benefits accounted for 70 ne< cent of the total budget. A breakdown follows: Item Personnel comPensation . _ Personnel benefits__ _ _ _ TraveL _. . • _ Transportation of things • . _ Rents, communication, and utility services__ _ . __ Printing and reproduction. . . _ Other services.- . .___ __ _ " .~__ . . _ Supplies and ffiaterials " , _ EqulpmenL._~~. . . ""_._ Land and structures~_. . . . __ Total amount obligated~•~_~~_.._ Amount $13,929,171 1,018,689 223,286 77,016 452,757 11i9,911 233,390 2M,673 521,048 53,321 16, 911,434 The source of these funds and the authority for expenditures there under is Public Law 88-511, 88th Congress. Expenditure details and their justification are set fOIth at length in the FCC budget presenta tion to Congress. ELECTRONIC COMPUTER SYSTEM The Commission's electronic computer system has been operating for a full year in processing citizens and amateur radio applications, printing authorizations for those services, and providing complete, up-to-date licensee information for monitoring, surveillance and man agement information purposes. The computer is also performing broadcast engineering computations, producing automatic plots of service contours, and developing and maintaining optimum assigu ments of UHF television. Plans for fiscal year 1966 call for further mechanization of the Commission's paperwork and engineering workload, i.e., processing of marine and aviation radio applications, maintenance and retrieval of information pertaining to broadcast station and individual owner ship, and computation of various AM, FM, and TV engineering problems. The computer is a UNIVAC III purchased and installed in Novem bel' 1963. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 13 APPLICATION FILING FEES Up to June 30, 1965, the Commission had collected $4,641,231 in application filing fees. This is the sum total since the FCC fee system was inaugurated on March 17, 1964. It includes $998,601 collected during the initial 3'h-month period (to June 30,1964). These fee collections are turned over to the U.S. Treasury. The Commission's fee charging is in compliance with Government policy to charge for certain Federal services. The FCC's fee charge was contested in court bnt, on July 10, 1964, the court of appeals affirmed the right of the Commission to exact fees. On January 18, 1965, the Supreme Court declined to review that decision. Present FCC fees range from $2 to $100, depending upon the type of application and the service concerned. In connection with its con tinuing review of the charges and procedures involved, the Com mission on March 17, 1965 (exactly 1 year after it established fees) proposed to amend the fee schedule in some particulars (docket 15881). HEARING EXAMINERS The Commission's Chief Hearing Examiner and 15 hearing ex aminers were appointed pursuant to the provisions of section 11 of the Administrative Procedure Act of 1946, as amended. They serve as presiding officers in formal hearing proceedings instituted by the Commission, and prepare and issne initial decisions based upon the evidence adduced in these proceedings. During fiscal 1965, the Chief Hearing Examiner, acting under special authority delegated to him by the Commission, issued 420 orders and memorandum opinions and orders on interlocutory and other similar matters arising in adjudicatory proceedings. The hear ing examiners held formal hearings in 103 such proceedings, requir ing sessions on 434 days; completed 75 hearings; released 79 initial decisions disposing of 125 applications; and issued 966 orders and memorandum opinions and orders on interlocutory matters. DOCKETS A total of 591 cases were designated for hearing during fiscal 1965, of which 266 were for broadcast facilities and 232 involved the safety and special services. More than half (282) of the 502 docket cases pending at the close of the year concerned broadcast. The following docket statistics refer to individual applications in hearing status. Broadcast dockets: AM broadcast: New stations. •• 80 57 2 10 4 25 17 7 72 18 31 Major c.hanges--.-----.---•••-.----------I~_~'~':_I---___;'=Ocl2 5 3 18 8 1 38 16 20 subtotaL_••• ••_•••• • ._.__I=~1~2~'~I~==~8~7+~~;;.+==::'~5+==~7=1==~.;;,3==;;2;5_1~~~~81=~1='=O~I==~'=.1==~~=51 ~~~~~~.~~_~~~~~~=~~~:=============1~-----·-·-ii- ·------T _._. .__~_----~-.--~--·-··----6- ·-···---2- :.-~-.---i2---------i- ---------·-2 X~o~~:r-s~==========================::===~~--------.---·--·~---2·-.....------ ---·----i- -·-----T ==========:=.~:_ ====:===== ========:::: Total AM broadest dockets•• .____ 142 101 5 18 8 50 28 10 124 35 53 FM broadcast: Newstations._••_. .__________________ 37 80 10 18 10 14 6 59 19 25 Major cbanges ._._•••_. __ -----.---- __-,,-'_1----,-.1__-,,-_1 -,,-'_1 ---;'_1-_---:-:: ' _1_--.--.-.--.-.---1--.-.--.--.-.--.--,---_1--- 3 ..__.'_1---- ' subtota1 •••_. • •• •__ ••I===":=I~==="==I~~=lO=I====2=O-I====13=I===15=I===,;;I-~===c6__1===82==I=~~'~O1=~=::2~6 Assignments and translers. . .__. 2.~_••_••.•_. • ._. •~__2 •• ._•• _ Renewals_.__ • •__ ._________ 2 •__ ._. .•~_______1~~_••_•• .__ 1 . _._. _ Llcenses__~_.•__ •~•••_•••__ •~• • • • •~_.~---.~•• __~_••__ • •__ .• • _ Allothers__.~_.••._.~__~_1 • ••__ •••~••••~.... • •~•__ •• 1 • _ Total pending July 1, 196. Disposed of without hearing Disposed of following hearing Total Designatedl , , +__---; -,- ! pending for 1- lune 30, bearing Granted Dismissed Removed 1 Granted Denied Dismissed 1965 8 " 18 ..._------_. 82 2 1 • 20 71 Initial decisions issued Applica. tions cov eredby fnitIal decisions I I 1 __ • __ • •• •• • __~•• • ••• 61 21 92 '" 23 '82 62 .. , -------..._- --.._----. -----..--- ..--_._----~3 3 3 '" ---------._- --·----25- ....__ .--- , 88 7 11 10 7 , • .. , 11 • --._-------- • _._--._._- .._--------~35 -._.----.. -----..._--- '45 29 , 6 175 16 25 7 ------------ --.- 3 3 " 3 313 28 121 60 32 502 79 117 ._--_.._- ._--_.._._- -..._-.,_. -.._-_.. _- .._-_..._-_. --..._-... -..._--_...._-.-..- Assignments and transfers••__ • __ •••__ • • __ ••••~•~• ._. • ._. •• •• __ •• ••_._. ••__ •• __ •• •• _. ••__._ Renewals••••_._.__ •••• ._••_. __ •••__ ._.__ • • __ • • _•••_. •• • __ •• _._. • •• •••_. __~•• •• __~_•• •__••_. ••• •• •••__ Licenses_._•••_••__ ••••_._. •__ ._._•• •• ••••__~._"._, •• •• _. • •• __~_.••_. __ •• __ ••••__ ••._~__ • ••__ •••••_ Allothers._•• _•••••_. __ ••__ ••_•••••_. __ •• __ • ._ •• __~__ • .,._, • __ •__ • •• •• . __ .•__~_.. __ ••_. __ •__ • _•••__ •••__ • •• • •• Total dockets •••_. ._••.••_•• __ UHF·VHF boosters·repeaters: Newstations ••_._._••••• ••••• 1 •• ••• _•••_. _ Majorehanges •••••• •••••_. __ •••• ••• ••••••~_••_. _ Subtotal••_•• •••• •__ • •••• 1 ••__~.• __ ••_._.__ 1 Removed (rom hearing status and returned to 'Processing lineS. t Statistics in this service cover revocation of liccnse as well as applications. ------------I;;;---;;;---~---c-I"~~I-=---~---=---~--I~---;;;;---~-------------- ------------ ---------- ---------- ------------ Other broadcast servloos__ • ._____________ 18 3 4. •. . ••• 16 ••• ••• •• __ --=-1---::-::-1--:-:-1------,,-1----:-:-1----::- ,--=-1-----:::-1---::: Total broadcast dockets __ • ._.:~=~'~94~I==~'~6~6ol"==="=I"==~~I~==~I Other than broadcast dockets: ~1~1y~=ira{iio-seivroos2==:::::==:::10~231 ---··--14- Common carrier servioes • .___ 76 29 8 loint and general matters•••_.~••• , 3_'_1 '_3_ 1 16 Total other than broadcast dockets__ ._ 214 288 38 Petitions, cease and desist orders, rules, etc •• 50 37 29 Total Dockets__"~.~••_~•• ._.__ li5S 591 93 16 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT AUTHORIZATIONS Radio station and radio operator authorizations, collectively, totaled nearly 4% million as of June 30, 1965. Comparative figures for fiscal 1964 and 1965 follow: CI"" Broadcast services. •.• ••••• _ Safety and special radio servioos. • • Common carrier services_. • ••••• •.••__ • _ Experimental. ••• • •• ". x~~~ic~~f~ig=:s~~~~~============================:=::: TotaL • _ June 30, 1964 June 30, 1965 Increase 17,231 18,544 1,313 1,418,826 1,466, gIl 38,085 8,343 10,015 1,672 698 747 49 2,613,875 2,711,837 97,962 256,237 268,881 2. "" 4,315,210 4,456,935 141,725 The radio station authorizations represent the use of about 5.3 mil lion fixed, mobile and portable transmitters. APPLICATIONS The number of applications for service groups other than broadcast decreased in fiscal 1965. The 777,153 total was 183,972 less than the year previous. Comparative figures were: Broadcast services. _ Safety and special radio serviUlS 1__ _ ._ Common carrier services. . _ F.xperimental~_ Commercial radio operators . _ TotaL . _ 1964 1965 Increase or (decrease) 15,727 16,812 1,085 582,511 494,723 (87,788) 9,667 10,654 987 1,559 1,520 (39) 351,661 253,444 (98,217) 96l, l25 777, l53 (183,972) I Applkations for amateur radio operators are included in the amateur service total. Reduction in the application total is attributed to such factors as the application fee charge, tightened curbs on Citizens radio and some other users and changes in the rules governing operator grade require ments. However, there ,vere increases in applications for radiotele phone operator licenses and restricted operator permits. RU'LES ON EX PARTE COMMUNICATION On July 7, 1965, the Commission adopted rules governing ex parte commwlication in adjudicatory and rule making proceedings desig nated for hearing which are required by statute to be decided on the record (docket 15381). The rules spell out restrictions upon com munication with members of the Commission, their personal staffs FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 17 and other "decision-making Commission personnel." In proceedings which have been designated for hearing, all oral ex parte presentations are prohibited, and "interested persons" and non-decision-making Commission personnel are prohibited from making written ex parte presentations. These rules, among other things, implement section 409(c) (1) of the Communications Act. TECHNICAL ASSISTANCE TO FOREIGN EXPERTS During the year, the Commission arranged training for 62 par ticipants from 22 foreign countries as its contribution to the U.S. technical assistance program. Twenty-two visitors from six addi tional countries were received in Commission offices and given tech nical assistance while another 18 participants from 11 countries were addressed by Commission personnel. This program is a joint effort of the Department of State,the Agency for International Development and the International Telecommunica tion Union. With the cooperation of operating companies, equip ment manufacturers, institutions for technical training, and Federal, State, and local government agencies, it affords an opportunity for foreign key communications personnel to study and observe telecom munication systems in the United States. The FCC monitoring station at Laurel, Md., provides on-the-job training in radio frequency monitoring and direction finding to those foreign visitors interested in that particular communication activity. CORRESPONDENCE More than 4.7 million pieces of mail were handled by the Commis sion's Washington office (exclusive of its Field Engineering Bureau) during the course of the year. Of this total, over 3 million waS incom ing and over 1.7 million outgoing. The mail volume in fiscal 1964 "mounted to over 4.6 million pieces. RELEASES AND PUBLICATIONS The Commission does not maintain mailing lists for its public no tices and formal documents. However, the text of its major decisions appear in weekly pamphlets which can be subscribed to at the Govern ment Printing Office. On July 9, 1965, the Commission announced that, beginning with fiscal 1966, these weekly pamphlets would con tain "all decisions, reports, memorandum opinions, orders, statements of policy, public notices, and all other official utterances and acts which are or may be of precedential value or public interest, together with the separate, concurring or dissenting statements." In addition, the Com- 18 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT mission plans to publish material issued in prior years, not previously published, which has continuing interest or significance in relation to its work. The Government Printing Office also sells, on a subscription basis, copies of FCC rules and regnlations; also sells annual and other re ports, the Communications Act and amendments, etc. A list will be furnished by the Commission on request. In addition, all Commis sion hearing orders and rule making (both as proposed and as ad opted) are given official promulgation in the Federal Register which can also be subscribed to at the Government Printing Office. Total paper usage by the Commission in fiscal 1965, for all purposes, amounted to 27.9 million sheets, requiring 36,345,000 offset page prints. This is an increase of 1.8 million sheets and 3.1 milHon prints over the previous year. Law and Enforcement LEGISLATION Legislative Activity No legislation amending the Communications Act was enacted dur ing fiscal year 1965. The Commission's recommendation to the President in his considera tion of a bill to repeal excise taxes on various items was substantially incorporated in Public Law 89-44, which was signed on June 21, 1965. This law repealed the following provisions of the Internal Revenue Code of 1954: Subchapter C of chapter 32, part I, relating to the manufacturer's excise tax on radio and TV sets, and their components, effective as of June 22, 1965. Subchapter B of chapter 33, relating to the user's tax on communica tions, effective as to the telegraph tax and 7 percent of the 10 percent excise tax on local and long-distance telephone service, including tele· typewriter service, on January 1, 1966, and phased reductions of 1 per cent each year thereafter until complete elimination by January 1. 1969. FCC Legislative Program Commission proposals to amend the Communications Act introduced in the 89th Congress and pending at the end of the fiscal year were: An amendment to section 4 to remove inequities imposed by cantlict at-interest ,provisions thereof on Commissioners and employees, and to exempt therefrom members of the Commission's Executive Reserve and "Special Government Employees" (8.1948, H.R. 7790). An amendment to section 203 to require a connecting carrIer to file a tariff covering communications subject to the Commission's jurisdiction where there is no fully subject carrier obligated under tbe statute to file a tariff (8.1284, H.R. 5867). An amendment to section 204 to extend from 3 to 9 months the period during which the Commission may suspend any new or revised charge, classification, regulation or .practice of' a communications CQmmon car rIer pendIng bearing and decision under section 2M, and to place the burden of proof on the carrier to justify all new or revised tariff sched ules (8. 2141. H.R. 8777). 19 20 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT an amendment to sections 214(b) and 222(c) (1) to substitute the Secretary of Defem.'e (rather than the Secretaries of the Army and Navy) as the person entitled to notice of the filing of certain common carrier applications (S. 1554, n.R. 6482). An 'amendment to section 303 (q) to give the Commission jurisdiction to require the painting and ilhwliuation of a.·bandoned radio towers and to require dismantlement when they constitute a menace to air navigation (IS. 9(3). An amendment to conform the Communications Act to the Conven tion 011 Safety of Life at Sea, London, 1960 (S.1949, H.R. 7954). Signed Aug. 13, 1965. To add a new section 302 to give the Commission authority to pres cribe regulations pertaining to the manufacture, import, sale and in terestate shipment of devices which cause harmfUl interference to radio reception (S.1015, H.R. 5864). A Commission legislative proposal awaiting clearance by the Bu reau of the Budget at the end of the fiscal year was: To add 'R new section 223 to give the Commission ,regulatory authority over the charges and other terms and conditions in arrangements be tween communications common carriers for the interchange of their fac ilities or the furnishing of facilities or service by one communications common carrier to another. Other Bills Affecting the FCC During those parts of the 2d session of the 88th Congress and the 1st session of the 89th Congress covered by fiscal 1965, 133 other bills were introduced which affected the Commission's functions direct ly or indirectly. Requests for comments were received on 62 of these bills. Congressional Hearings During fiscal 1965 the Commission appeared and testified before congressional committees on such matters as : Independent Offices Appropriation bills. Review ofI!~CCactivities in major areas of current interest. Electronic eavesdropping. Limiting height of antenna towers (B.J. Res. 261). Safety of Life at Sea (H.R.7954). 'Community antenna televisioll (H.R. 7715). Six bills on the FCC legislative program (S. 903, S. 1015, S. 1284, S. 1554. S. 1948, and S. 1949). Establishing a Federal Boxing Commission (R.R. 8635, H.R. 8676, H.R. 9140, H.R. 9196, and H.R. 9426). FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 21 LITIGATION Decisions of Special Significance The following decisions, in the U.S. Supreme Court and the Court of Appeals for the District of Columbia Circuit, are noteworthy. In addition to involving inlportant princip1es of law, the cases affect subject matter of particular interest to Congress and to the general public. Federal CommunIcations Cotnmi,ssio-n Y. Taft B. Schreiber and MOA, Inc., 3,'3 V.S.L. Week 449"2, -- L.R --. In the Commission's -annual reports to Congress, the history of this {'ase through the U.S. Court of Appeals for the ::-.rinth Circuit ,yas recounted. That court -affirmed n decision of the U.S. Distriet 'Court for the Southern District of Cali fornia. refusing to enforce a suhpoen-a issued hy the 'Commission incon~ nectlon with the Commission's network TV programming investigation. The subpoena, inter alia., had called for public disclosure of all network television progra.m8 from the broadcast of which .Music Corporation of America received compensation. It was resisted on the ground that the material requested constituted trade secrets. The Supreme Court upheld the Commission's rule requiring public disclosure except where the proponents of a request for confidential treatment have demonstrated that the public interest, the proper dis l>atch of business, or the ends of justke require nonpubUc sessions. The court held that it is for the Commission, and not the courts, to decide whether material subpoenaed in an investigation is to be kept confi· dential, and that if the 'Commission's judgment is reasonable it cannot be supplanted. The court found that the Commission did not abuse its discretion in -applying the rule In this case. Accordingly, it remanded the proceeding to the District Court with directions to enforce the Com mission's orders and subpoena \vithout qualifieation. Aeronautical Radlo, Ino. v. UnUed States and Federal Oommunica tions Oommission, 335 F. 2d 304 (C.A. 7, 19(4), cert. den. 379 U.S. 966. During 1964, the 'Commission 'began charging fees for application fil ings in connection with most of its licensing activities. The petitioners charged that title V of the Independent Offices Appropriation Act of 1952, 5 U.S.C. 140, represented an unconstitutional grant of legislative 'power and that the fee schedule adopted by the Commission was arbitrary. The ,Court of Appeals rejeded both of these assertions. It held that the statute eontained a yulid delegation of authority. since the Con gressional objective was plain, the method ofa~hievementwas pre scribed and the guiding standards were adequate. Reviewing the fee schedule in light of the record before the Commission. the court ,found that the Commission had taken into account the standards prescribed by the statute and that the fee sehedule adopted was a reasonable one. The Supreme Court denied certiorari. Wilson & 00. v. United Sta·tes ana Federal Oo-mmunicationsGommis~ sion, 335 F. 2d 788 (C.A. 7, 1964), cert. den. on the merits 380 U.s. 951, 789-224--6~3 22 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT cert. granted on the questions of restitution, 380 U.S. 950. This ap peal was brought from the decision in the so-caned "private line case," an investigation begun in 1955 into rates being charged for private line communications services. The final order of the Commission resulted in an aggregate decrease in A.T. & T.'s rates for private line telephone serv ice and an aggregate increase in rates for private line telegraph service furnished by A.T. & T. and W'estern Union. The decision was chal lenged on both procedural and substantive grounds. Procedurally, the court's decision held that the notice of the pro ceeding published in the Federal Register was as specific ,as the Com mission could have made it at the time, and adequately served to inform interested pa,rties of the nature of the proceeding as reqUired by the Administrative Procedure Act, even though it did not specify every as pect of the final decision. The court also sustained participation in the decision-making process by members of the Commission's Common Car rier Bureau who were counsel of record in the heR'ring, on the ground that such participation is proper in rule making and that it does not deprive the parties of due process. On the merits, the court beld that the Commission gave appropriate weight to the various factors entering into a determination of a fair rate of return. It rejected the contention that apportionment of the carrier's costs as found by the Commission was not supported by the evidence, and affirmed the Commission's determination that the cost of providing service should priDlarily control rates. The Court of Appeals, however, refused to include in its final decree a provision for restitu tion to those adversely affected by an interlocutory injunction which had stayed the effect of the Commission's order pending the appeal. The Supreme Court granted the GoVeI11ment's petition for certiorari on tbis issue on March 29, 1965. American Broadcasting-Paramount Theatres, Inc., v. Federal Commu nications Oommission, --F. 2d --, (C.A.D.C., 1965). This case has been before the Commission in various aspects for many years. Radio station KOB, Albuquerque, N. Mex., was originally assigned to operate nondirectionally on the frequency 770 kilocycles on a temporary basis in 1941, after the North American Regional Broadcasting Agreement. 55 Stat. 1005, made it impossible for KOB to continue to use its then assigned frequency at 1180 kilocycles. In 1951, the court ordered a hear ing on this status on the complaint of WABC, the clear channel sta tion on 770 kilocycles in New York City, and directed the institution of further proceedings looking toward permanent resolution 'Of the problem. American Broadcasting Co. v. Federal Communications Commission, 191 F. 2d 492. In 1958, the Commission adopted a decision amending its rules to permit class I-B operation by both KOB and WAEC on 770 kilocycles, each to operate with directional antennas so as to protect tbe other from interference at night. This would increase primary service in the under~servedSouthwest. ABC appealed from that decision, claiming that the Commission had erred in considering only two channels as pos sible frequencies for KOB, and that KOB should be accommodated on some frequency other than 770 kilocycles to avoid an adverse effect on ABC's competitive position vis-a-vis other networks. The court affirmed FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 23 the Commission's decision. American Brotuloasting 00. Y. Federal Com· m1mications Oommission, 280 F. 2d 631. Its opinion stated, however, that in a proper proceeding brought before the Commission by ABC, or sua sponte, the Commission should seek to afford the ABC network channel facilities on a fair basis with the other networks. In 1961, in a proceeding involving, inter alia, W ABC's application for renewal of license, the Commission reopened the previous proceed ing and invited ABC to submit additional evidence with respect to its network position. At the conclusion of this proceeding in 1963, the Commission held that ABC had not demonstrated that the curtailment of WABe's service area would substantially prejudice ABO's competi tive position as a network with resultant public injury. W ABO was directed to file an application consistent with the conditions of operation specified in 1958. The court held, however, that the Commission could not require a directionalized operation by ABC without "compelling public interest reasons". Terming irrelevant a Commission finding that this mode of operation would not adversely affect ABC's network operation, the court's opinion stated that absent such compelling reasons, ABC must be allowed to operate on an equal basis with the New York stations of the Columbia Broadcasting System, Inc., and the National Broadcast ing Co., which operate nondirectionally and need not protect any other stations on their frequency. The Commission has filed a conditional petition for certiorari, pending a request for clarification of the mandate of the Court of Appeals in con nection with further proceedings proposed by the Commission to examine the current state of radio service in the Southwest and the impact of the denial to ABC of comparable facilities with the other networks in New York City. Lafayette Radio Electronic8 Corp. v. The United States of America and the Federal Oommunications Commis8ion, 345 lr. 2d 278 (C.A. 2, 1965). Lafayette Radio Electronics Corp, sought review of a Commis sion regulation which prohibits the use of Citizens Radio Service sta tions as a hobby or diversion. The rule was adopted after apr~eeding in which hundreds of licensees and interested members of the public submitted comments. The rule was challenged as violating the first amendment to the Constitution, and section 326 of the Communications Act, 47 U.S.C. 326, which precludes the Commission from censoring radio communications. The court denied Lafayette's petition for review, indicating that sec tion 326 of the act must be read together with section 303, 47 U.S.C. 303, which authorizes the Commission to classify radio stations and to prescribe the nature of each station within any class. The court pointed out that the absence of restrictions on the number of users in the Citi zens Radio Service demands restrictions on use of the frequencies, and upheld the Commission's power to prohibit communications which serve no purpose other than as a. hobby. The court also found no merit in Lafayette's argument that the Commission's rule was void due to vagueness. The court held that the rule was not invalid simply because borderline cases could be imagined where a conscientious licensee might have fair doubt whether his communications are banned or not. The 24 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT court pointed out that suchdouht.~could be clarified through inquiry and that except for the most flagrant cases, the Commission invokes sanctions only after a warning and an opportunity to correct violations. (A petition for review raising similar is:,mes has also been filed in the Ninth Circuit. California CiHzcn:5 Band Association, Incorporated v. United States of America and Federal Com.munications Commission, Case No. 20030.) Statistics During the fiscal year, the Commission was a paTty to 91 cases in the Federal conrts. Sixty-seven new appeals were instituted dnring that period-8 on petition for writ of certiorari in the Supreme Conrt; 53 in the Court of Appeals for the District of Columbia Circuit; 3 in the Court of Appeals for the Ninth Circnit; 1 in the Court of Ap peals for the Eighth Circuit; and 1 in the Court of Appeals for the Second Circuit. Additionally, the Commission filed a memorandum as amifl'U8 tJUriae in the U niled States Court for the Southern District of California, Central Division. At the beginning of fiscal 1965, 24 cases were pending in the Federal courts. One of these cases was in the Supreme Court; 20 were in the Court of Appeals for the District of Columbia Circuit; 2 were in the Court of Appeals for the Seventh Circuit; and 1 was in the United States District Court for the Northern District of Ohio. At the fiscal 1965 yearend, 28 cases were pending in the Court of Appeals for the District of Columbia Circuit; 2 in the Court of Ap peals for the Ninth Circuit; and 1 in the Conrt of Appeals for the Eighth Circuit. One petition for certiorari was before the Supreme Court. Five of the eight petitions for certiorari filed by private litigants during the fiscal year were denied by the Supreme Conrt. Two peti tions for certiorari, filed by the Commission, resulted in writs being granted, one of which achieved a remand to the District Court for the Southern District of California in accordance with the position nrged by the Commission. In the courts of appeals, of the 53 new appeals filed, the Commis sion was affirmed in 10 cases; 4 cases were remanded, and 13 were dis missed. The following is set forth in regard to the previously noted 24 cases pending at the start of fiscal 1965 : The petition for certiorari pending in the Supreme Court was deuied. Of the 20 cases in the Court of A1' peals for the District of Columbia Circuit, the Commission was af finned in 4 cases, 4 wereremanded~7 dismissed and 5 remain pending-. Of the 2 cases in the Court of Appeals for the Second Circuit, Ipeti tiou to set aside an order of the Commission was denied and, in the FEDERAL COMMUNICATIONS COM.\USSION 1965 ANNUAL REPORT 25 other case, the Commission was affirmed. The pending ca.se in the Distriet Court for the Korthern District of Ohio was dismissed. The following is a tabulation of cases decided and pending in the courts for the fiscal year 1965 : Court of ApIX'uls for the District of Columbia Circuit TotalDistrtct courts 402{b)4D'2(a) Other Supreme ----,,---,----1 COurtl; of Court - apPLtcllite positioned over the Pacific Ocean at an >Lltitude of 22,300 miles. The purpose of the project was to bring live TV broad cast of the Olympic Games in Tokyo to the vVestern vVodd. After the signals were received at the naval center ground station, they were sent by lllicrowave to Los Angeles for distribution over the domestic TV networks and to Canada. The program was recorded on video tape and flown by jet aircraft to Europe. COMMISSION ENDS RESTRICTION ON SALE OF STOCK The Commission adopted rules effective August 5, 1964 (docket 15495), under which the common carriers were prohibited from seIJ ing any of their stock in the Communications Satellite Corporation, prior to Jnne 1, 1965, to entities other than authorized COUlmon car riers without prior consent of the Commission. The basic purpose of these rules was to prevent the carriers from profiting from their pre ferr"d position in procuring stock by selling it shortly after issue at prices considerably in excess of the issue price. The Commission believes the rules accomplished the intended purpose and there ap peared to be no need to extend the prohibition beyond June 1, 1965; however, the Commission is maintaining close surveillance over the stockholdings of the carriers inthe Corporation. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 45 OVERSEAS CARRIERS USE OF EARLY BIRD CHANNELS In its June 22, 1965, action opening Early Bird for commercial use, the Commission authorized four int.ernat.ional eommllilications car riers (American Telephone & Telegraph Co., ITT ,Vorld Communica tions Inc., RCA Communications, Inc., and ,Veslern Union Inter national, Inc.) to le,lSe voice ch1,614 13,133,575 71.64 84,687,222 91,922,323 •.M 286, 822, 217 299,410,249 4.39 266,659,860 278,324,217 4.37 20,162,357 21,086,032 4.6. 1,000,000 (1,200,000) (220.00) 24,930,601 16,973,571 (31.92) 7,418,689 16, 973,571 128.79 10,490,373 10,000,498 ,10 104,220,311 97,448,219 ~6,60) 28,015 26,607 5.(3) $160,649,507 $161,129,268 .30 Item Book cost or plant (as of Dec. 31) _ Depreciation and amortization reserves _ Net book cost of plant . ._._. . _ Message revenues _ Teleprinter exchange service revenues _ Leased-e1rcuit revenues. _ Total~ratingrevenues__ • _ O~~nu~d~~:I~ns~~~~~~~~~~~~_~~~_~~~~~_~~~~~~~!_ Net operating revenues_. _ Provision for Federal Income taxes t _ Net income 3 _ Net Income (landllne and cable systems) _ Dividends (landltne and cable s}.stems) __ •I~~'='="":""'I~~~~"""~I~~~~ Number of revenue messages handled 4 _ Number oremployees at eud or October _ Total compensation of employees for the year. _ I The Western Union Telegraph Oo.'s ocean-cable system was sold to Western Union International, Inc., ~S:fe\n~i~~.inFt~;:rne:xfi':~\~~Western Union's cable operations for the period Jan. 1, 1963, to Sept. 30, 2 Reflects estimated net reductions In Federal income tax expense or $4,160,000 and $5,000 000 In 1963 and 1964, respectively, arising from the utilization, ror inoome tax purposes but not for accountG;.g purposes, of a Uberallzed depreciation method recognized by Sec. 167 of the Internal Revenue Code of 1954. Also reflects estimated net increases in Federal income tax expense of $195,000 and $12.;,000 In 1003 and 1964, respectively arising from the utilization in prior years of 5-year amortization authorized under Sec. 168 of the Internal Revenue Code of 1954. The accumulated amount to Dec. 31, 1004, or liberalized depreciation and 6·year amortization Income tax differentials accounted for on the "flow through" basis was $27,866,000. Invest ment tax credits were not used in 1962, 1963, and 1964 due to the absence of tax liablUty for those years (the $1,000,000 tax expense in 1963113 the result of an accountlng allocation). The estimated unused Investment tax credit carryover amounted to $2,500,000 at Dec. 31, 1964. I The decrease in net income rrom 1963 to 1964 is in considerable part attributable to the fact that the $8,260,000 tax credit arising from the loss on sale of the ocean-eable system in 1963 WBS t.abulated as an extra ordinary income credit of the landline system. 'Includes domestic transmission of transoceanic: and marine messages (about 11,582,000 in 1963 and 10,894,000 in 1964). Overseas Telegraph Carriers Financial and operating statistics relating to the U.S. overseas telegraph carriers for the calendar year 1964 are shown below as compared to similar figures for 1963. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 71 Overseas telegraph camers Item 1003 1964 Percent or Increase or (decrease) 15.93 7.30 ~59 (9.30) U6 61,524 'l:l,423,I94 1,101,711 9,041 $53, 130,805 63,069 25, 645, 580 1,073,910 9.968 $51,905,482 Number otcarrlers..--------------------------------------------~~==8;;,1."""~=~8.1-;;-;--;;-;--;;-;--;;;-- Book cost 01 plant (as of Dec. 31). __ • .____ $153,464,873 $191,412,422 24. 73 Depreciation and amortization reserves __ ._._.__________________ 66,9.19,045 71,461,786 6.74 Net book cost of pl8nt~___________________________86,626,828 119,960,636 38. 84 Message revenues: Domestic 1••• 3., 321, 063 3,608,521 8. 66 TransoceanIc~._.__________________ li6, 406, 818 58,122,073 3. 04 1I1arine. _. ._. ._.____ 2,250,346 2,678,969 19. GIS Teleprinter exchange service revenues. .________ 13, 6iH, 874 17,206,025 25.67 Lea.sed-elrcult revenues ._••__ •••• 12, 098, 159 14, 646, 831 21.07 Total operating revenues__ • •••_._. ••_••••••• 97,821,724 107,560,162 9.00 °s:r:~o:~~__~~~~~~~_~_~~_~t_~~~_~~~~~_~~~~~~.86,101,934 91,109, Hi6 7.06 Net operating revenues ._. ••• ••••• ••••__ .___ 12,719,790 16,451,006 29.33 Provision lor Federal income taxes , __••• • 3,611,450 5,439,352 50.61 Net income. • •••_. __ • '(8. 637, 5(0) 9,158, 28li (I) Dividends declared 6. • •••••_•••••__ •••_••_••• • •1~..;;2.;;";;1;;.3;;50;;,1~~~;;"';;~;;;;"";;,11~~;1S;;,.09;;;, Number of revenue messages bandled: Domestic 1••~•••_•••••_••__ • ••_. • _ Transoceanic_ • _. •••••_•• • •• • _ Marine. •__ • _ Number of employees at end of October•••••• •__ •••_••• _ Total compensation of employees for the year.__ •• • • I Includes revenues from the domestic transmission 01 transoceanic and marine messages outside of points of entry or departure in the United States and revenues from domestic-classification messages (primarily Canadian and Mexican). t Radiotelegraph trall8OOO3nic message revenues of All America Cables &: Radio, Inc., $1,631,684 in 1963 and $2,298,591 in 1964, are not included. 'All America. Cables, Commercial Cable Co., and ITT World Communications had for the year 19M net reductIons totaling $300,000 in Federal income tax expense arising from utilization for income tax pur poses, but not lor accounting purposes, of a liberalized depreciation method recognized by Sec. 167 of the Internal Revenue Code of 1954. These amounts were accounted for on the "flow through" basis. The accumulated amount "flowed through" lor the years 1962 through 1964 was $1,110,000. The liberalized depreciation income tax differentials accumulated in the acoounts 01 Ali America and Mackay (now ITT World) during 19M through 1960. in the amount of $885,000, are being amortized in equal amounts over 10 years beginning Jan. I, 1962, to provision lor Federal income taxes. RCA Communications bad for 1964 net reductions in Federal income tax expense of approximately $750,000 arising from utilizing the 1954 liberalized. depreciation method. The accumulated lUIlOunt of liberalized depreciation income tax differ entials accounted lor since 1957 on the "flow tbrough" basis was $3,287,000. ITT World Communications had investment tax credits in 1964 amounting to $206,392, RCA Communications had investment tax credits amounting to $300,000 and Western Union International bad investment tax credits amounting to $68,000. The full amounts 01 these credits were accounted for -on a "flow through" basis. 'The loss in 1963 is attributable to tabulating gross book loss 01 $18,126,223 incurred by Western Union Telegraph Co. on sale 01 its cable system as an extraordinary income charge of the cable syStem whlle the related Federal income tax credit of $8,250,000 Is tabulated as an extraordinary income credit 01 the domestio telegraph system. I Not comparable. eAll dividends declared by Western UnIon Telegraph Co. for 1963 have been reported in the previous table and excluded from this table, although data pertainmg to Western Union's cable operations prior to date of sale to Western Union International (Sept. 30. 1963) are included. in this table. T Represents domestic classLfication messages (primarily Canadian and Mexican) Overseas Message Telecommunications Services During the calendar year 1964 the international telegraph carriers handled 24,509,000 messages going out of and coming into the United States. In the outbound direction 12,290,400 messages were trans mitted, while 12,218,600 were inbound. In addition, 2,415,700 Telex messages were handled, including 1,060,900 outbound and 1,354,800 inbound. There were also 5,900,800 telephone calls handled during the year including 3,443,700 outbound and 2,457,100 inbound calls. The foregoing figures include traffic between continental United States and Hawaii and overseas territories. The number of telegraph mes- 72 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT sages, Telex messages and telephone calls between the United States and overseas points during the calendar year are set forth in the following table: U.S. overseas message teZecommunications services, 196J,-Includes traffle transiting the United States {Units in thousands] Telegraph messages Telephone calls Telex messages Country Out bound from United States Inbound to United States Out bound from United States Inbound to United States Out bound from United States Inbound to United States EUROPE, AFRICA, AND NEAR EAST EurX~~nla_________ "____ ------------ 1.6 1.1 ._----- ---------- Austria. ________ 61.6 66.4 13.6 5.9 3.7 7.5 Azores _____ •_______ . ----------------- 2.7 2.4 .5 .2 Belgium______________________________ 179.2 180.8 29.5 23.0 35.6 61.6 Bulgaria______________________________ 4.1 4.6 .1 (') .7 .2 Cyprus. ____________ ----------------- 5.0 5.4 .4 .8 Czechoslovakia___ . _" ___ 17.3 28.8 1.2 .8 1.0 2.0 Demnark__~__________________________ 93.0 88.3 21. 1 14.2 9.3 16.5 Finland________________________ 29.8 37.2 3.7 1.9 1.4 3.9 France________________________________ 601.7 liOO.9 146.2 102.4 60.6 109.5 grt~f~~~~~t~~~~=-=-=-=-~~-=~=~-~=-~-==~-===} 680.6 633.3 285.6 124.9 9'" 112.8 1.5 1.5 .2 .2 (') (') Greece and Greek Islands ------------ 104.3 87.0 18.4 12.3 3.7 4.5 Greenland4_-------------------------- 1.2 .4 (') .1 f~l~~::rr.-.-~~========================== 16.3 25.2 3.2 1.0 1.0 2.3 8.1 9.0 2.5 1.8 .8 .8 Ireland___ . ________ ----.------ 55.0 61.0 20.1 14.6 1.3 .9 Italy__________________________________ 573.8 607.4 99.9 49.7 31.6 49.3 Luxemburg________________ 7.1 7.6 1.8 1.4 1.7 2.2 Malta________________________________ 3.0 2.2 .1 .4 .1 .1 Netherlands________________ . _________ 324.6 324.6 43.0 35.0 41.1 82.2 Norway__ 4_______________ ----------- 116.9 104.0 16.3 10.0 24.3 31.8 Poland_______________________________ 29.4 55.9 1.8 3.6 1.6 4.3 PortugaL_____ . _______________________ 60.9 li5.6 4.0 3.1 1.8 3.0 Roumania____________ 7.5 8.4 .5 .4 1.7 2.3 Spain_________________________________ 210.4 189.0 39.2 22.9 8.4 11.1 Sweden.______________________________ 169.0 179.4 31.7 23.6 17.6 24.2 Switzerland________ 366.3 347.8 70.5 43.0 50.9 69.8 Turkey. --.---------------------- ---- 54.7 48.6 2.5 1.9 U.8.8.R. ______________________________ 45.5 45.6 1.3 3.9 (') United Kin,e;dom _____________________ 1,693.0 1,817.0 360.0 313.9 149,4 174.1 Vatican City 8tate____________________ 2.5 3.6 (Included with Italy) Yugoslavla___________________________ 35,7 31,0 2.2 1.7 3.7 4.5 All other pllWeS- ______________________ 1.6 9.1 1.1 .5 (,) (') Total Europe_______________________ 6,664.3 5,578,1 1,222.3 819.2 547.6 782.6 .1 .1 .2 .1 2.0 (') (') ----(1)---- (') .1 .3 (» (') (') (') .1 .6 (') .3 ~:lm --------- ------;i .8 __~_~-------:2-~~-·(i)---- .1 .1 .2 (') (') (') .1 .2 (') .2 .5 .4 ,5 1.0 (I) (1) _ ---------- ---------- _.- (') .1 (') 1.1 4.2 4.3 (') .1 2.2 1.7 7.4 .5 .5 .2 .1 1.3 10.9 .7 16.3 2.4 1.4 .1 9.4 4.5 4.6 .1 .1 2.2 2.7 7.2 .8 .8 .4 .2 1.6 10.5 ., 15.7 2.2 1.6 .1 10.9 Africa: Algerla4. _ Angola. _ Basutoland _ Bechuanaland . _ Burundi. _ Cameroon _ Canary Islands . _ Cape Verde Islands__ _ _ Central African Republic _ Chad, Republic oL _ Comores (Comoro Islands) • _ Congo (Brazzaville) _ Congo (Leopoldville) _ Dahomey .4 __~• 4 _ ~:~~~~i~(;maliiaii~C::================ Gabon~.• _ Gambia__~.4 _ Ghana _ See footnotes at end of table. FEDERAL COMMUNICATIONS COMMISSION 1966 ANNUAL REPORT 73 U.S. over8eas message telecommunications services, 1964-Includes traffic transiting the United States-Continued [Units In thousands] Telegraph messages Telephone calls Telex messages Country Out- Inbound Out- Inbound Out- Inbound bound to bound to bound to from United from United "om United United States United States United States States States States --- ------------ EUROPE, AFlUCA, AND NEAR Xft,ST-Con. 2.0 _ (I) _ -------.-6- ::::::: _ •• .1 .1 (') (') .2 ---.------ ---------- ----(iy--- ----(ir--- ----(1,---- .2 P) .2 .1 1.6 (') (') ---------- ---------- --:4- .2 .2 .6 .6 2.2 .2 .3 .. .7 --- -------- .1. (') .1 .1 (') P) .2 .1 .1 .1 P) P) P) (') 1.• 1.2 .5 .8 P) (') ---------- -- P) P) P) .. 1.6 .1 .1 ---------- •• -------:4- ·-----".-1 .2 (') (') (') .1 .1 .1 •• .3 2.8 (') 3.' 20.5 35.3 23.6 2.5 3.7 .6 .2 .8 15.7 3.0 .. 27.5 .1 (') .3 12.9 .7 3.6 .6 5.1 2.' 124.6 .1 (') 5.8 .2 5.1 •• 7.7 2.' 61.6 .. 1.6 1.0 3.' I') 5.0 21.0 32.3 22.' 3.3 '.5 1.1 .5 1.0 17.0 2.7 .7 31.8 .1 .1 .3 12.2 •• ••• •• 6.' 2.1 106.0 .1 (') 6.1 .1 6.7 1.0 7.0 3.7 49.6 • 6 2.6 .6 Africa-Continued Guinea, Republic or. • _ Ifni Territory _ . _ Ivory Coast _ Kenya _ Liberia ._____ _ _ _ Llbya " Madeira Islands__ Malagasy Republic__ Mall . _ Mauritania _ Mauritius____________ _ _ Morocco . _ Mozambique _ Niger______ _ _ Nlgerla _ Portuguese Guinea~_ Principe & SaoTomc _ Reunion Island _ Rhodesia and Nyasaland . _ RwandL__ •~~__ ~:;~~~s~::::::::::::::::::::::::::: Stf'rra Loone~__ Somall Republic _ South A.fn<:.l\nRepubli~_ Spanish Guinea _ Spanish Sahara . _ Sudan, The_. _ Swazlland _ ~~~~~~~~~~~~~~==~===========~~--U ganda . . _ United Arab Republlc _ Upper VOltB____ _ . . _ Zandbar . _ All other places _ Total Arrlcs. _ 424.8 441.8 lUI Hi. I •. 2 13.4 Near East: Arabia-Aden______________ 6.2 6.5 .1 Arabla-SaudL .___________ 26.n 24.0 .6 .6 _ Arabia-Yemen__ .__________ .5.3 . _ Arabia-OtheL . __ • 2.4 5.5 _ _ Iran. . 63.4 42.6 1.4 1.3 2.1 3.5 ~1==-----:==::==________________1~:~l~~s:~ai ------4:4- 4.9 L~~~on=:::=:=::::::::==::___________~:~5~:~1:~2: i ------i:3- 1. 9 Persian GuU-Bahreinand MuscaL_ 4.8 5.1 .1 .5 .5 .6 PersianOu1C-KuwaIL~___________15.5 16.0 .1 .2 _ Persian OuU-Other______________ 4.1 4.6 . _ Syria . 11.0 7.8 .3 4.3 _ All other places .________________ (I> • _ ------------------ Total Near East ._ 349.4 365.9 13.4 Hi. 9 8.3 10.9 Total Europe, Africa and the Near = ===1== East .~__________________6,338.6 6,385.7 1,247.6 850.~565.1 806.8 See footnotes at end of table. 74 FEDERAL COMMUNICATIONS COMMISSION 1065 ANNUAL REPORT U.S. overseas message teleoommunicatio1M aeroicea, 196..f-Inclutlea traffic transiting the United Statea-Continued [Vnits in thousands} Telegraph messages Telephone calls Telex messages Country Out- Inbound Out- Inbound Out- Inbound bound to bound to bound to kom United Crom United from United United States United States United States States States Sta.tes --------------- 1.72.1 .1 . . _ .7 53.9 1.9 ..... ••• '.3 79.4 2.7 187.7 &6 4.l --····-:i- ----···:i- ==:::::::: :::::::::: 64:~6i~------:-4- -------·:3 .2 .1 __._~__ ••_ .•••• •• .3 .2 _._.._~ .3 .2~•• _••__ •••_~ .2 .1 •• _. __ •• • 9: i 11:~·-----i:o- -------1:2 _________~.2 ._••• • _ .1 . __.._.. _ ----2~rr-·---~-f::::::i~;========ii .1 .8 'fl. 7 83.1 a. 9.2 77.4 75.8 19.8 1&7 (') .1 26 2.3 1.6 1.9 2.8 2.6 83.3 64.1 1.1 1.• 1.6 1.6 1.9 2.2 1.8 1.9 .6 .. 53.8 60.8 .9 .9 .7 .2 .1 ('J 273.2 38.'\.0 93.8 Q7.2 6.3 ••• 7.' 6.3 .1 .1 3&7 42.2 60.8 63.7 33&. 351.0 BERMUDA, WEsT INDIES, CENTRAL, NORTH AND SOUTH AMERICA Bermuda••~_.₯._.__ ,~~_ West Indies: British West Indies: Antigua. ••• ._.__ Bahamas. _• •~•• __ • _ Barbados. __ •• •• • _ CarrlfiCOu ••• _ Cayman Island~_••••_~_ Dom1niea•• •~•• • Grenada A •~•~__._ J wnalca.__•~~__ •••_~._ Montserrat~~••_._. _ St. Kitts and Nevis__._~_ St. Lucia_~~• _ St. V1ncent •••• _ +~~~(C~=============::============ Turks Isla.nd••~._ Virgin Islands (British)...~~ Ofher BrJtJsb West Indies__~_ Cuba •••~~._.~_ Dominican Republlc_•••~.••__ ••• French Antilles: Guadeloupe.__•__~.__._.~__ • • Ma.rt1n1que~~••_.~~_ Hatt?_t~_e!_~r_~~~~_~_~~~~==:=============------8:2- ----·-3:8-----~-·:4---··-·--:6 Netherlands AntfIleS-..~~~_4.0 3.6 2.1 1.6 Puerto Rl(l(L~~._____436.6 383.1 Zl.9 43. IS Virgin Islands (United States): ~t~~~as-andEff.-ioiUi~~===========~:~~~:n45.3 35.2 .4 1.2 Allotherplaces_••~~~.~~__________18.9 3.8 •••~••_.~• ._ ------------------ Total West Indles •__•• 1,120.1 1,222.6 1.079.9 644.0 38. 7 M./5 ===== Central Amedea: British Honduras. • •• 12.2 11.7 1.9 1. 1~_ Canal ZOne•• • .___ 37.3 48.4 (Included with Panama) Costa Rlca.. • ._._._____ 63.5 56.8 12.6 12.6 .5 .5 Guatenmla__ ••._~._.________83.9 89.5 15.4 13.9 _ Honduras Republtc~~~49.8 46.9 8. 9 9. 4 •.~•__ ••__ i!~~===::::::::=====::=:=======:~:g~~~~~~l~:g-----io:l- -·'·'--7:3 8alvador~._.__~•• •• 74.1 71.9 7.6 7.6 __ ._._•••• •• _ All other places •••~• • •__~~• _..~_~• ._ ••••_.~_ ------------------- Total Central America_.____________ «9.1 400.7 115.3 105.0 10.6 7.8 ====== --- ------------ ---- 227.2 127.5 66.2 69.1 15.7 13.8 = = = = = = 255.4 241. 7 23.6 22.3 38.2 66.8 35.7 35.0 .3 .1 .2 .3 346.6 299.7 22.7 19.1 47.6 49.9 19.1 15.2 .8 .7 96.9 83.7 8.6 10.0 17.3 28.2 289.5 195.7 24.' 27.' 20.2 21.6 78.2 78.7 8.6 7.' 2.8 3.2 1.• 1.3 (') i:l ~------:6------··-i::i 11.5 '.1 .1 North America: I Alaska~~~••• 2.5 2.7 •••_. _ Canada_~.__~___________________- -- 114.4 23:7- 32.6 32.8 6.6 - -----2.1 Mexlco~___________________________112.7 163.8 31.1 33.5 9.1 11.7 St. Pierre and Miquelon~______.1 ••._~~__~_---- _ Total North Amerlca. _ South AmerJea: Argentlna~_ Bolivill__ • •.~_ Brs.zil~~. _ British GulllDa~_ Chile~~_ Colombia •~__ Ecuador~.~.~__ French Guiana. • __.~_ Paraguay_..~••_.~_ See footnotes at end of table. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 75 U.S. over88aa message telecommunications service8, 1964-Include8 tra1flo transiting the United States-Continued [Units in thousands] Telegraph messages Telephone calls Telex messages Country Out- Inbound bound to from United United States States Out bound from United States Inbound to United States Out bound from United Stares Inbound to United States ---------11---1---------- 149.6 123.5 18.6 18.1 26.6 36.8 12.8 11.4 1., 1.7 .7 1.0 84.' 75.3 ,.. 6.4 1.1 6.4 368.4 4054.9 32.7 33.8 14.8 13.6 .2 .1 _4 ________ ---------- _4 ________ ________ .4 218.1170.2147.3147.61, 750. 2 1,625.4 BERMUDA, WEST JNDIES, CENTRAL, NORTH AND SOOTS A.lIlERICA-continued South America-Continued Peru.• _ Surinam•••• _ Uruguay . _ Venezuela._~._. _ All other place,!L __ . •••.•__ ------------------- Total South Amerlca. •• _ ===== Total Bermuda, West Indies, Cen- tral, North and South America_ 44 3,585.0 3,469.3 1,488.5 1,019.2 237.3 2115.8 ===== HAWAII, ASiA, AND OCEANIA lIawali 4_. .______ 297.0 262.2 502.4 415.2 25.5 23.1 Asia: ACghanistan.~________________________5.4 4.2 .1 .2~_ Burma .____________________ 9.5 7.4 (I) (I) _ gtrl~~~~~=l~;;=~~~~~~~~,~~===~====It~1~:~(1).1 (1).3----{I)~----~------.-i China-RepubllcoL~_________7~:~M:i (1)3.6 (1)2.6 ------6:3- -------9:' Hong Kong~4~~~____173.8 144,8 13.6 12.7 10.4 8.9 India~~₯. • 240.1 247.0 3.1 4.4 1.7 1.2 Japan~"~__~4~__tlSl.7 560. {) 88.4 66.7 161. {) 147.7 Korea-North~___66'.'2 (")0.4 ".6- ------4--.•-- ------4-.-0- -------6-.-7- Korea-Republic o'-~~~_ t~====================:===========2:~4:~----{Ir----~--{I)-------~--==-=========== Malaya._.~~~~____15.4 15.0 .9 1.0----~-.6.7 Paklstan~~~__ 99.1111.6 .7 1.1 .5 1.2 Si.ngapore~_45.3 38.5 1.1 1.2 Tha1land __~~_~~~4______ 53.6 50.1 .6 .8 .3 .9 Viet-Nam~~~~_36.2 47.5 1.1 5.2 _ Allotherplace8_______________________ .6 .1 . _ ------------------ Total Asia~.__ 1,423.4 1,365.4 125.9 99.4 186.8 178.1 ===== '.1 15.4 '.1 16.729.9 .2 --itii' -------:4- --------:3 .6 3.3 •~_ (') .2 6.8 <{7.7 -----25:9-----~-32'-3 2.2 __ 4 _ 234.3 2054.9 27.6 .8 •• 2.1 .4 .4 6.' 5.6 19.5 20.7 11.1 60.' 81.7 .2 .2 (') .6 1.1 1.2 (') .7 .4 .1 59.3 85.' 6.6 .6 .6 220.1 253.1 16.8 30.3 37.0 15.1 Oceania: Australia_~,_~_ BruneL~• _ FIji Islands. • _ ~~:a~_~~~:~~~~~=====================Indonesia__ • _ MIdway Islands~_ New Caledonia •__ New Guinea and Papua TerritorY4 _ New Zealand__ •~_ North Borneo • ._ Philippines. • . Ryukyu Islands _ Samoa Islands: American~______3.1 3.4 1.1 .7 • _ Other_ .• . __ .•._4~__.9 .2 (I) (I) 4 _ ~~~:~~-isi;mds======================(I) .7 (I) .7 (I)--~-{Ir~--========== ---------- Wake Island 4 4____ .3 .2 .3 .8 __ . . AUotherplaces ₯~_4~._5.6 8.8 .6 .4 (I) ------------------ Total Oceania •__~4•• 643.2 736.0 79.4 72.9 46.1 51.1 ===== TotaIHawaii,Asiaandoceanla_~•• 2,366.8 2,363.6 707.6 tlS7.5 258.4 252.2 ===== Grand toto.L~._ 12,200.4 12,218.6 3,443.7 2,457.1 1,060,9 1,3054.8 NOTE.-Detans may not add to total due to rounding. I Less than 50 message!! or calls. , RepresentsInternatlono.l-classlficatlon traffic whIch originated at overseas points and destined to Alaska, Canada, or Mexico (outbound £rom United States), and similar traffic whIch origInated in such places in North America and destIned to overseas point:!! (Inbound to United States). This tratnc was bandiedbe~ tween such North American and overseas poInts by U.S. carriers via the contiguous United States. 76 FEDEllAL COMMUNICATIONS COMMISSION 1965 ANNUAL llEPOllT Common Carrier Radio Authorizations Authorizations outstanding in the common carrier radio services totaled over 10,000 at the close of the fiscal year, an increase of more than 1,600 for the year. Comparative figures by class of service are shown below: CJ"", June 30. 1004 June 30, 1965 Increase or (decrease) TotaL~_ 1Studio-transmitter.link. 4,143 <.0" 44. 73 77 , '3Il '98 '" 3,618 4,710 '.092 28 110 82 • • --~·-------(3) .. 11 8 8 ------------ 11 8 (8) ...., 10,016 1,672 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 77 Common Carrier Applications Over 10,600 applications were filed with the Commission by common carriers during the fiscal year (exclusive of Alaskan and marine mo bile). The following table shows the number of applications accord ing to class of service: Cl"" Pending June 30, 1964 Disposed PendIng Received of June 30, 1ll6.> RadiofadlU~ 2 1.444 .. 252 • 16~•._.. _ 35 22 10 '.422 19 ""2.~ 46 16 37 22 10 4,852 17 231J ~330 43 .. New snd changed facilities: Domestic: Point-to-polnt miClrowave radIo stations________ 1,014 Local teleVision transmisslonstatloDS__________ 2 Rural radio statlons • ._ 8S Domestic public land mobile radio stations_____ «2 Developmental stations•• .__________________ 4 Registration of Canadian radio stations__ •• _ International: Point.to-polnt radlotelegraph-telephone._~_ ~~1~t~:~~~~~=l~J'~-_-=~::::::::::::::::::::::::::: International controL~••_._ _______ _ , __ •~_ Renewal of license: I Polnt-to-point microwave radio statioIl8~__~____ _ Local televisIon transmission statioIl8~•~~_ Rural radiostatlOIl8~.~~~_.~_~~•~. • • Domestic public land mobile radIo service: Systems of- Tale-phonecompanj(,~L• ._.._~~_~___________645 645~_ Miscellaneous common carriers . • _ Customer-llupplied mobile units utilizing b8.'le sta.tlOIl8 of- =f::::o~eX~egjj:C3iiien::::=:::::::=::==:=::::::~._~~~~~~~~~_::::=::=:::= Developmental stations •••~_.__._._~~_~~______108 lOS •__ International.~._.~_•• ••._. __.~__~. _._. . 36 36 _. ._••_ Total, radIo facilitle8._. . __.. •• .._I=~~l;;.MO;;;;'I~~~;;;;I~~~;;;;'I=~~~ Wirll tacilUiu Telephone exteIl8iOIl8 __ ._ •••._.. ••.•_~~_.~______ 9 Telegraphextenslons.~•.._. •_...~~~~____ __ 8 Telephone reductions••.. •~•.•..~~.•.. _ Telegraph reductiOns... .._. ••.•. ._.~_~.•.___ 110 I---I----I---,-I--~ Total, wire facilities-- ••··••-.~---·-..-.~--_.__._·I=~~l;;,ZI~I=~;;;~J~~"""'=I,=~~,;;; MuC4!UawuOUf Applications to purchase stock in Communications Satellite Corporation•._~~..~~______________4 3 6 }~:a~~i~r:af~:=:iIons-_~::::=::=::::::=:::=:::::: =:::::::=:==__.~_.~_~__.~:~..__ Submarine cable landing llcenses~••~.~______2 6 5 3 Grand total ••__~._••••••_._••__._~_~~•••• _ 1,683 10,654 10,472 1,865 I Lfcenses in the variouS oorrunon carrier radIo services are isSued for terms of trom 1 to [; years and all lIcenses in a gIven service expire at one time with new licenses issued between renewal dates being only lor the unexpired license period for the class. This explaIns why the number of license renewal applica tIons rna,. be none in some years. CATV Systems HOW THEY STARTED Community antenna television (CATV) systems were born of a de sire by people in small and isolated communities to obtain TV gervice. Conseqently, the first CATV systems were established, largely by local enterprise, in places uuable to support a local TV station and beyond the service range of outside TV stations for satisfactory off-the-air reception. As early as 1949 a pioneer community antenna was tested at Astoria, Oreg., and what is said to have been the first commercial CATVsystem startedat Lansford, Pa., the following year. CATV systems later developed in communities having a local TV statiou, or near one, where persons desired to receive more than one TV signal. The result is that CATV service has become a large and fast-growing business. HOW THEY OPERATE CATV systems pick up programs of outside TV broadcast stations directly off the air by means of a receiving antenna or bring them in by microwave radio relay. These signals are sent from the local CATV distribution point by multipurpose coaxial cable (which can simultaneously carry up to a dozen or more signals on different fre quencies) to the homes of subscribers linked to the cable system. Usually, for technical reasons, the TVchannel picked up by the CATV antenna is converted to another frequency for reception on the home set. The signals are amplified for distribution to customers. Because cable line lengths and frequencies differ, it is sometimes necessary to employ other amplifiers en route. At the home, the incoming cable is attached directly to the receiving connection of a regnlar TV set, and all the viewer has to do is to turn his dial to the particular channel he wants. No separate converter is necessary. 78 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 79 GROWTH OF CATV About 1,700 CATV systems are now in operation, serving over 4lh million viewers. Whereas early systems offered programs over only two or three channels, today the average channel choice is five. Some systems provide 9-even 12--channels. CATV service is being ex tended into cities which have one or more TV stations. There is com petition for CATV franchises in several large metropolitan areas. The present largest CATV system has more than 15,000 customers. About 90 percent have fewer than 3,000 subscribers, the average being about 655. COSTS OF CATV The average subscriber pays about $60 a year for CATV service in addition to an initial installation charge. Costs of establishing CATV systems vary widely. Exclusive of antenna, they rangebetween $3,500 and $4,000 a mile. The estimated cost of a system serving 1,000 customers is about $150,000; for 5,000 customers, $400,000; for 10,000 customers, $800,000. CATV systems normally string their cables on poles rented from the telephone company, sometimes from the power company or local municipality, and occasionally put up their own poles. Pole rental to CATV systems varies from $1.50 to $5 per pole. In one city CATV proponents plan to use municipal underground conduits. More than 300 CATV systems get their programs over microwave relay, for which they pay an annual rental of from $12,600 to $96,000 to carriers other than the telephone company. Franchises granted by local au thorities usually entitle the municipalities to some percentage of the CATV's gross revenue or other type of annual payment. CATV COMPETITION TO TV STATIONS Beginning in 1957, competitive conflicts developed between TV sta tions and CATV systems operating in the same area. Various con siderations are involved. A local TV station has to program on a single channel, and where a CATV system operates in the station's community or service area, the TV station has to compete with the CATV's offer of a choice of network and other programs on multiple channels. The extent of competition depends on the number of actual or potential CATV sub scribers. In some cases the CATV has refused to carry the signal of the local TV station. There has also been complaint that, although the CATV system carries a local station's program, the station's signal is sometimes degraded to an extent which causes viewers to turn to other 80 FEDERAL COMMuNICATIONS COMMISSION 1965 ANNUAL REPORT stations on the CATV system. Installers of CATV cable connections sometimes disconnect the set from or even dismantle the home antenna, which may prevent the set owner from receiving the local TV sta tion directly off the air. CATV systems, because of the prohibitive cost of extending cables beyond built-up areas, do not serve outlying places where people are dependent upon regular TV service. In consequence, if CATV com petition forces the only TV station in a community off the air, the adjacent rural population loses TV service. Similarly, people living in the urban area who are unable or unwilling to pay CATV charges are dependent upon TV broadcast. Moreover, a TV station is a medium for community news and expression and otherwise serves local needs beyond the ability of a CATV system to provide. The CoJnJIrission recognizes the valuable contribution of CATV in bringing new or supplementary service to many places and the desir ability of furthering the orderly development of these systems. But, at the same time, it holds that CATV serdce should be supplementary to and not cripple local TV broadcast service or impede the growth of TV broadcasting. Accordingly, it has proposed and, in some in stances adopted, rules which are noted subsequently. CATV REGULATION CATV operation is not regarded as broadcasting because it does not transmit to its audience over the air. Nor can it be technically called pay-TV since the programs it picks up are broadcast free by the orig inating TV stations. And the Commission has held that it is not a common cs,rrier within the meaning 'of the Communications Act. Consequently, CATV is in the category of wired radio and TV oper ations which do not now require Commission licensing. However, CATV may involve incidental radio (microwave) usage which defi nitely requires FCC licensing and regulation, and, as noted later, the Commission recently reached the tentative conclusion that it has juriSdiction over all CATV systems. Aloo, the Commission restricts all incidental radiation, including that of CATV systems which might interfere with licensed radio operations. CATV is subject to some degree of control at the State and local level. Thus far, only one State (Connecticut) regulates CATV as a pnblic utility, but other States are considering doing so, and most localities require franchises for CATV operation. CATV regulation was the subject of a hearing before a subcom mittee of the Senate Iuterstate and Foreign Commerce Committee in 1958. Legislation to give the FCC broad l1uthority over CATV including licensing-was defeated in the Senate in 1959 by a single FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 81 vote. A more limited bill (S. 1044), to authorize the FCC to issue rules and regulations for CATV systems, was proposed by the Com mission in 1961 but was not reported out of committee. On April 28, 1965, Chairman Harris of the Honse Interstate and Foreigu Com merce Committee introduced a bill (H.R. 7715) to establish a national TV policy and provide a method for Congress to review FCC rules for CATV systems before they become effective. FCC ACTIONS IN CATV FIELD The Commission has for several years been concerned about the problems posed for free TV----<)Specially the development of UHF broadcast service-by the mushrooming growth of CATV systems. Following is a chronology summarizing its major actions concerning CATV: On April 2, 1958, the Commission dismissed a request by Frontier Broadcasting Co. and 12 other AM and TV broadcasters that it exer cise jurisdiction over CATV systems as common carriers. The Com mission held that CATV systems are not engaged in common carrier operations within the meaning of title II of the Communications Act. (This position was reaffirmed in dismissing similar requests by WSTV, Inc., March 23, 1962, and Philadelphia Television Broadcasting Co., July 28, 1965. The latter and others on August 5, 1965, asked the appeals court to declare CATV systems common carriers.) On May 21, 1958, it instituted an inquiry into the economic impact on TV broadcasting by CATV, translator, satellite and booster opera tions (docket 12433). On April 13 of the following year, while not undertaking any regulation of CATV systems, it advocated legisla tion which would require CATV systems to (1) have the consent of the TV stations whose siguals they pick up, and (2) carry programs of the local TV station, if the station requested it, and to do so without degrading the station's sigual. On February 14, 1962, the Commission denied an application by Carter Mountain Transmission Corp. for additional microwave relay facilities to serve several CATV systems in Wyoming unless the car rier conld show that duplication of programing of the only local TV outlet in one of the communities (KWRB-TV, Riverton, Wyo.) would be avoided and the CATV system would carry programs re quested by the station (docket 12931). On May 23, 1963, the court of appeals upheld the Commission's right to refuse to license common carrier microwave facilities to carry signals to CATV systems if the result might canse the demise of the local TV station with resultant loss of service to the public. The Supreme Court on January 25, 1965, declined to review this decision. 82 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT On December 12, 1962, the Commission proposed rules (docket 14895) to condition grants for priVll.te microwave stations in its Busi ness Radio Service relaying programs to CATV systems to the re quirement that the CATV system not duplicate, for a period of 30 days (later reduced to 15) before or after, any program carried by a local or nearby TV station, if the station so requests, and, also on request, carry the local station's signal without material degradation. This rule was intended to give the local TV station exclusivity with regard to programs it selects for presentation but allow the CATV to present the great bulk of programs broadcast by the outside stations feeding into its system. Following the court decision in the Oarter Mountain case, the Com mission on December 12, 1963 (docket 15233) proposed like conditions for microwave grants to common carriers in the Domestic Point-to Point Microwave Relay Service serving CATV systems, and made more definite its previous proposals for private microwave relay (docket 14895). During the pendency of these proceedings, applications for micro wave service to CATVs were not granted unless the applicant accepted the proposed conditions. In addition, all such authorizations were made subject to the outcome of the rule making. This interim pro cedure was affirmed by the court of appeals in the Wentronics, Inc., case on March 26, 1964. Pursuant to notice given on March 13, 1964, in granting transfer of WBOY-TV, Clarksburg, W. Va., to an operator of CATV systems, the Commission on April 15 thereafter instituted an inquiry into joint ownership of CATV systems and TV stations (docket 15415). On July 27, 1965, it reported that its inquiry had not disclosed any evi dence of widespread abuses and that the situation did not warrant a ban on cross-ownership but warned that it would take action in specific cases of "buses. The Commission's action granting the transfer was appealed and, in May 1965, the court of appeals reversed the Com mission, holding that concentration of control and other questions required a hearing. On July 29, 1964, the Commission proposed to place private micro wave facilities in the Business Radio Service which serve CATV sys tems in a new class of service called Community Antenna Relay Service, to be administered by the Broadcast Bureau (docket 15586). At the same time, it proposed new rules for like service by common carriers, and frequency allocations for both types of operation. This was intended to accommodate the growth of CATV systems by provid ing more efficient use of the spectrum space allocated for microwave relay. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 83 On December 29, 19M, in a case involving Pacific Telatronics, Inc., the Commission reaffirmed its authority to regulate common carriers using microwave facilities to serve CATV systems even though the microwave link was wholly within a State. It held that such a com mon carrier operation was an extension of, and incidentAl to, the broadcasting of TV signals and, therefore, was interstate in character and subject to regulation under title II of the Communications Act. On February 3, 1965, the Commission granted that part of a petition by WAGM-TV, Presque Isle, Maine, which requested clarification of the CATV nonduplication condition. On March 5, 1965, the Commission released "An Economic Analysis of Community Antenna Television Systems and the Television Broad casting Industry" compiled by Dr. Martin H. Seiden, economic con sultant, who was engaged in 1964 to aid the Commission in its overall study of the CATV situation. This 91-page report was placed on public sale by the Government Printing Office on March 18. An ap pendix giving more detailed analysis was added to the Commission's public reference files the following month. On April 22, 1965, the Commission adopted the carriage and non duplication rules for microwave-served CATV systems as proposed in dockets 14895 and 15233. At the same time, it instituted an inquiry and rule making con cerning regulation of CATV systems in general (docket 15911). This proceeding is in two parts. In the first part the Commission reached an initial conclusion that it has jurisdiction over all CATVsystems and proposed to extend the nonduplication requirement to nonmicrowave using CATV systems. The Commission held that CATV systems are engaged in interstate communication by wire and, therefore, are sub ject to regulation under sections 2(a) and 3(a) of the Communications Act and, further, that sections 4(i), 303 (f), (h) and (r) of the act enable it to prevent frustration of the fair, efficient and equitable broadcast provisions of sections 1 and 30'1' (b) . Accordingly, it pro posed extending the carriage and nonduplication requirements to nonmicrowave-served CATV systems. In the second part of this proceeding, the Commission instituted an inquiry looking toward rules on other questions of concern related to CATV development. These have to do with CATV entry into large cities and their effect on independent UHF stations, possible restric tion on the extension of a station's signal by CATV, whether CATV system should be required to carry nearer stations instead of "leap frogging" to distant ones, CATV program origination, and possible relation of CATV to pay-TV. 84 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT The Commission stated: While we have initially concluded that we have jnrisdiction, we would carefully consider comments addressed to this aspect . • . Second, we adhere to our position that clarifying legislation would be desirable. and have no intention ot bypassing congressional action in this field. We are clearly concerned here with new and important questions of pol· icy and law in the communications field. That being the case, the Commission would welcome (i) a cODgJ:'essionai guidance as to policy and (if) congressional clarification of Our authority. which would lay the troublesome jurisdictional question at rest ... In short, by insti tuting this proceeding, we shall gather essential data, both for the Commission aod the Congress, and will have conserved valuable time and be in a position to take tlnal effective action in either ot two even tualities: (1) Congress has enacted legislation in this field which does not preclude the Commission from promulgating rules ... or (2) no legislation is forthcoming, and the comments in the rule making pro ceeding lead to the conclusion that the Commission does have present jurisdiction ... The rulem~kingproceeding ... will thus be con ducted concurrently with legislative consideration, with final Commis sion decision withheld for an appropriate period to a1ford Congress an opportunity to act. On October 13, 1965, the Commission established the proposed Com munity Antenna Relay Service (docket 15586) and adopted the pro posed rules for like service by common carriers. The technical portions of this proceeding are still pending. Broadcast Services POLITICAL BROADCASTS Section 315 Considerations Inquiries from licensees ami from candidams for public office con cerning rights for the use of broadcast time arising from the operation of section 315 of the Communications Act are handled as expeditiously as possible. Receipt of a complaint is acknowledged immediately and the licensee is advised of the complaint and directed to submit its comments. Both complainant and licensee are notified of the Com mission's disposition of any complaint. On July 31, 1964, the Oommission issued a supplement to its public notice on "Use of Broadcast Facilities by Candidates for Public Office" which contained additional significant rulings and recommended a procedure for complainants designed to achieve expeditious handling: Since Commission policy is to en courage negotiations between licensees and candidates seeking broadcast time or having questions under section 315, it recommended that a complaint not be filed until after there has been a good faith effort to resolve any differences'. Such negotiations, when successful, may save time which is an important factor in a political campaign, as well as alleviate the necessity for filing a complaint. Also, in the interest of saving time, the Commission recommended that ,the com plainant simultaneously send a copy of his complaint to the licensee, that the licensee respond without awaiting Commission inquiry, and that complainant and licensee furnish each other with copies of all their correspondence to the Commission. The complaint should be in written form and should include, but not be limited to, information as to the public office involved, the date and nature of the election, whether the complainant and his opponent are legally quali fied candidates, when the complainant's opponent appeared on the air, the time of the request to the licensee for equal opportunities, and the reasons given by the licensee for :tailing to satisfy the request. Unlike the 1960 Presidential and Vice-Presidential campaigns, the 1964 cam paigns for these offices were not exempted from the equal time provisions of section 315, and the Commission handled complaints relating to these contests. Because 1964 was an overall election year the number of complaints handled in fiscal 1965 was substantially greater than in fiscal 1964, about 285 compared to 175. The Commission did not experience any serious problems in applying the 1959 amendments to section 315 cases, and is making no recommendations as to changes in this section. 789-224-66--7 85 86 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT Questions arising out of application of section 315 to specific factual situations increased in complexity and sophistication. The following significant section 315 matters came before the Commission during the fiscal year: On August 21, 1964, the Columbia Broadcasting System advised the Commis· sion that President Johnson would undoubtedly hold press conferences prior to election day. also Senator Goldwater. CBS stated it considered Presidential press conferences to be important news events and bad given them such broad cast coverage as its news judgment warranted. It belIeved it would be in the public interest to continue to cover President Johnson's press conferences, as well as those of Senator Goldwater. provided that this coverage would not require equal time for all other candidates for the Presidency. The Commission held that such press conferences could not qUalify within the exemption accorded bona fide news interviews (see. 315(a) (2» because they were not held at regular intervals but rather at the discretion of the candidates, and the scheduling, content and format were not under control of the network. It held further that they did not fall within the "on-the-spot coverage at bona fide news events." This part of t11e ruling was based on prior Commission hold ings that "if the sole test of theon~the-spotcoverage exemption Is simply whether or not the station's decision to cover the event and to put it on a broadcast pro gram constitutes a bona fide news judgment, there would be no meaning to the other three exemptions in section 315(a) since these, too, aU involve a bona fide news judgment by the bro.:'ldcaster. Carried out of its logical conclusion this approach would also largely nullify the objectives of section 315 'to give the public the advantage of a full, complete and exhaustive discussion, on a fair opportunity basis, to all legally qualified candidates and for the benefit of the public at large'." The Commission noted "if we were to con!rtrue subsection (a) (4) as encom passing all coverage of a candidate deemed newsworthy by the licensee, it would mean that the equal opportunities requirement of section 315, in effect, had been repealed .•. that the licensee, in the exercise at his good faith news judgment, could cover the speeches, press conferences, indeed any and all appearances of a candidate, without bringing into play the equal opportunities requirement." The Commission stressed that this ruling was limited to the matters raised in the CBS letter and does not extend to "extraordinary or unusual factual situations." On October 18, 1964, President Johnson broadcast a report to the Nation con cerning Khruschev's removal from office and Red China's explosion of a nuclear device. The Chairman of the Republican National Committee and the nominee of the American Party each requested equal time on the TV networks for the candidates of those parties and, after refusal, complained to the Oommission. The Commission c.onsidered its ruling during the 1956 Presidential campaign, in a similar situation, to be controlling in the 1964 case. During the 1956 Presi· dential campaign President Eisenbower used 15 minutes of broadcast time to address the Nation with respect to the Suez crisis. A question was then raised as to whether "equal opportunities" had to be afforded the other Presidential candidate. The Commission "reaeheda conclusion that we do not believe that when Con· gress enacted section 315 it intended to grant equal time to all Presidential candidates when the president uses the air lanes in reporting to the Nation on an international crisis." It noted that the 1956 ruling had been reported to the Congress and that Congress had subsequently amended section 315 without alter- FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 87 lng or commenting adversely on the 1956 ruling. The Commission also held that in this instance the networks could properly determine that a report on specific, current international events affecting the country's security falls within the Hon-the-spot coverage of bona fide news events" exemption of section 315. The Court of Appeals affirmed the action. The Supreme Court later denied certiorari. The United Community Campaigns of America (UCCA) advised the Commis sion that for some 30 years it has opened its United Fund and Community Chest drives with a special message broadcast by the President of the United States. It also stated that in recent years this had been filmed or video taped at the White House for later broadcast. The networks advised UCCA they (the net works) could not broadcast the President's message because of section 315 ap plicability to candidates. UCCA requested the Oommission to rule that this traditional address is nonpolitical and t1lat section 315 is not applicable. The Commission held. as it had done in the past, that section 315 contained no exemp tions with respect to broadcasts by legally qualified candidates carried !lin the public interest" or as a "pUblic service;" that a candidate's speech in connection with a ceremonial activity is a section 315 use; and that it was immaterial that the candidate used the broadcast time to discuss matters not related to his candi dacy. The fact that the appearance of the candidate is nonpolitical is not de terminatiTe of whether his appearance constitutes a section 315 use. The Commission did not decide whether presentation of the special message in connection with news-type programs would meet the criteria for exemption. since that question is one initially for the exercise of the good faith jUdgment of the broadcast licensee. The RepUblican and Democratic candidates for the U.S. Senate from New York appeared on a program originated by a TV station and fed to several affil· iated stations. The program consisted of 3 half-hour sectiong-...the first half· hour consisting of an interview of one of the candidates by persons chosen by his supporters, the second half-hour to a like interview of the other candidate, and the third half-hour to a panel discussion by all of the interviewers in which the candidates were not present. Equal time was requP,sted by the Conservative and Socialist Labor Party candidates for the same office. The Commission ruled that the program was not exempt from the provisions of section 315 as a news-type program and that both candidates were entitled to equal opportunities on the originating station and the other stations which carried the program. The Democratic candidate for U.S. Senator from Texas protested that a broad cast by his Republican opponent used audio taped excerpts from the Democrat's prior speeches, radio and TV programs to distort his position. He contended that if the stations broadcast the excerpts without his permission they would be in violation of sections 325 (prohibition against rebroadcast without consent of originating station) and 315 (prohibition against censorship by station of mate rial broadcast by candidates). He later supplemented his complaint to protest al1~geddistortion of his voice to give a false impression of his actual speaking manner. After receiving comments from the stations involved, the Commission notified the Democratic candidate it did not appear that the excerpts had been recorded off-the-air, hence the stations were not in violation of section 325. The Com mission held that, even assuming the licensees could have deleted the audio por tions of the Democratic candidate's voice from the RepUblican's program, that 88 FEDERAL COMMUNICATIONS COMMISSION I 9 6 5 ANNUAL REPORT is a matter in which the licensee was called upOn to make good faith judgment and in which he had wide latitude. The Commission could not find that the licensees' judgment in permitting the broadcast of tbe entire program of the Republican candidate was unreasonable or beyond the latitude accorded them in making programming jUdgments. Finally, the Commission advised theDem~ oeratic candidate that the stations' responses to its inquiries did not indicate any attempt to distort his voice. On March 6, 1965, station WMAY, Sprinflgeld, Ill.• requested the Commission to rule that regularly scheduled neV'gnized he could Dot use the station's facilities for his own private interests as opposed to the needs and interests of the area. 92 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT Accordingly. the Commission granted the application after pointing out that it was subject to the conditions governing all broadcast grants-that the licensee make a good faith effort to ascertain and serve the needs llnd interests of its area (rather than its private interests). will abide by the requirements of the fairness doctrine, and would not slant the news or distort factual material (Brandywine-Main Line Radio, Inc., WXUR and WXUR-FM, Media, Pa., de cided March 17,1965). The Commission received complaint from the president of the Freethought Society of America, Inc., alleging that statioIUJ in Hawaii, although carrying regularly scheduled religious programs, bad not alIorded her organization time to present its views on the subject of religion. The licensees' response to Com mission inquiry stated that "freethought" (which the complainant defined as "the total antithesis of religion") was not a sufficiently controversial issue of public importance in their area to warrant presentation, and that broadcast of church services, devotionals and prayers was not a controversial issue within ihe meaning of the fairness doctrine. The Commission stated that under the fairness doctrine a licensee must make rea'sonable judgments on the facts of each situation and that, in passing on any ('omplaint in this area, the Commission's role is not to substitute its jUdgment for that of the licensee but rather to determine whether the licensee acted reason ably and in good faith. On the basis of the information submitted, the Com mission concluded that the licensee had done so. The Commission added that even if it bad made a contrary finding, it could not order the licensee to afford time to the complainant since no personal attack was involved. (Letter to Mrs. Madalyn Murray, June 2, 1965.) BROADCAST ADVERTISING Loud Commercials Because of numerous complaints about objectionably loud commer cial announcements (particularly in TV) the Commission in December of 1962 began an inquiry into this subject (docket 14904). On July 9, 1965, it issued a "Statement of Policy Concerning Loud Commer cials" setting forth certain situations and practices which contribute to objectionable loud broadcast advertising which licensees are ex pected to avoid and control. Commission consideration of individual cases will be on the basis of complaints received and spot checks at renewal time. Also-since a number of broadcasters have contended that under the existing rules they are prevented from avoiding loudness because modultion must never be less than 85 percent on peaks of frequent recurrences-the Commission provided that modulation may be substantially less if necessary to avoid objectionable loudness in commercial and other material. The policy statement listed certain practices which are to be avoided: (1) Inadequate control-room procedures, such as inattention to the modulation meter resulting in excessive modulation on commercials, FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPOIlT 93 and undue reliance on automatic gain-control or peak-limiting de vices-both of which are causes of objectionable loudness; (2) ex cessive use of volume compression, particularly on prerecorded commercial material which may have been subjected to considerable compression and other electrical processing in recording (resulting in "compression on compression"), with a maximum of 6-db com pression being recommended at least for pre.recorded commercial material; (3) excessive use of other electrical processing devices, such as filters, attenuators, and reverberation (echo) units, particularly with prerecorded material; (4) use of prerecorded commercial ma terial employing excessive compression and other electrical processing; (5) voice commercials presented in a rapid-fire, loud and strident manner; and (6) presentation of commercials at modulation levels substantially higher than immediately preceding programs (a maxi mum of 4-db increase is recommended). Licensees are expected to engage in extensive prescreening of pre recorded material furnished them, either individually or through industry organizations and groups, for loudness, as many of them now do for defects and completeness. Broadcasters are expected to take reasonable steps to secure the cooperation of the recording industry in this area. The Commission recognizes that there are some factors involved which are beyond the broadcaster's control (such as individual psycho logical reactions by listeners), and that there is at present no precise standard by which objectionable loudness may be absolutely defined. What is expected is a good-faith effort by broadcasters to avoid pres entation of commercials which are too loud. The National Association of Broadcasters referred to the difficulty in defining the problem within limits which can be understood and followed by the industry and enforced by the Commission. In a re sponding letter, the Chairman of the Commission recognized that loudness does not lend itself to precise definition, and stated that the Commission realizes that a reasonable period will be required for industry adjustment to the policy stated, will use the rule of reason in applying its policy, and "will accentuate the positives of progress, not thenegatives of sanctions for sanctions' sake." In both the policy statement and the Chairman's letter, apprecia tion was expressed for the continuing activities of the NAB and its committee of industry experts in working on standards and devices concerning loudness. Appreciation was also expressed for the offer of the American Association of Advertising Agencies to assist in dealing with this problem. 94 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNDAL REPORT Double Billing Despite a warning issued in 1962, the Commission continued to find instances of broadcllSters and their employees engaging in the fraud ulent practice of "double billing." This, in its most common form, involves a station giving a local advertiser two bills, one for the amount actually charged for advertising and the other for a larger sum which the local advertiser uses to support a claim for reimburse ment under a cooperative arrangement with a manufacturer. InMarch 1964 the Commission proposed specific rules against this practice (docket 15396), and covering rules were adopted on October 20, 1965. BROADCAST PROGRAMING TV Network Program. During the year the Commission proposed rules concerning the re lationship of the national TV networks to programing. One pro ceeding is designed to further competition and increllSe diversity in program production and procurement by limiting network interest in programs; the other seeks to make network programs more readily available to stations other than regular affiliates. Propo.al 10 ';m;1 nelwork ;nlere.l;n TV program•.-Acting on recom mendation made by its Office of Network Study after a long study of TV network programing practices, the Commission on March 19, 1965, proposed rules to limit network control of TV programs (docket 12782) in order to deal with what the Commission terms "undue con centration of control in the three networks over television programs available to the public." To an increasing degree, network TV programs are those which the networks produce and own or in which they acquire an interest from the producer. By late 1964 the percentage of nighttime network hours devoted to programs in which they had no proprietary interest had decrellSed from about one-third in 1957 to 6.9 percent while 22.4 percent was network-produced and owned and 70.7 percent WllS pro duced under arrangements where the network acquired proprietary interest. This interest includes "syndication" (sale) to stations after its network showing, and to foreigu stations. Thus, independent producers become largely dependent upon the networks as a market for their programs. This is in direct conflict with the conditions of diversity and competition which are so highly deSirable in broadcllSting, both from an economic standpoint and in terms of providing diverse program sources. One aim of the proposed rules is to revive independent program production for syndication, so FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 95 that the increasing number of stations (particnlarly new UHF sta tions) may have better selection. The proposal has two main elements. First, it would restrict the networks' right to acquire rights in programs produced by others and to engage in distribution of programs for nonnetwork exhibition. They would not be permitted to acquire any financial or proprietary right in a program produced by others except for U.S. network exbi bition, or to engage in or share in the revenues from distribution of any programs for nonnetwork exhibition in the United States ("syn dication"). They could sell the right to such distribution to others with respect to programs wholly network-produced. As to foreign distribution, they would be permitted to engage in this only with respect to programs entirely network-produced. Under the second rule part, the networks could not offer during evening hours (6 to 11 p.m.) a network schedule in which more than half of the time is devoted to programs they produce, own or have a proprietary interest. News and sustaining programs would 'be ex cluded, because of their close relationship to the network's journalistic and editorial responsibility; other public-affairs documentaries would not be, although comments are invited on this snbject. The objective is to encourage independent production of a substantial portion of network programs, which would usually be licensed to the sponsoring advertiser ",ther than thenetwork. The Commission noted that strict adherence to the principles of free competition would perhaps suggest total removal of the networks from program production. But it concluded that this would not further the public interest in a nationwide TV structure sustained by network programing and, therefore, believes the proposal repre sents a reasonable balance. Making nelwork programs more widely avallable.-The Commission has long received complaints about the unavailability of network pro grams in situations where a regular affiliate does not clear a program and other stations in the area are desirous of carrying it. Failure of the networks to make such programs available has not always been consistent with the public interest. Not only is the viewing audience in a market deprived of the program but other stations (particularly nonaffiliates) do not have a chance to present it. This matter win become more significant with the growth of UHFstations. Accordingly, on .Tune 2,1965, the Commission proposed rules (docket 16041) which would provide that when an advertiser orders a par ticular program for a network affiliated station in the same market and the affiliate does not provide clearance satisfactory to the adver tiser, the network shall attempt to place the program on another 96 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT station in the market if the sponsor so chooses. The networks would be given a certain period to negotiate with their affiliates or any other alternate stations they prefer for clearance of fall programs. Ifclear ance arrangements are not made, they would be required to inform other stations ;n the market of that fact and later (if arrangements had still not been made) offer the noncleared programs to all statjons in the market on reasonable terms, subject to advertiser acceptance. SimDar not;ces would be requ;red at othertimes for canceled programs. The primary proposal would not be applicable to programs pre sented less often than every 2 weeks, or where arrangements have been made with a station to begin clearance within a certa;n time, or where the regular affiliate or other stat;on agrees to clear part but not all of a program. Sustaining programs would be covered by the rule. Vari ous extensions of the primary proposal are also set out for comment including, for example, possible extension to other programs such as "spectaculars" and other "one-shot" programs. Under another rule proposed in this proceeding, when one affiliated station ;s carrying a program and the advertiser also wishes to order a station in another community, the network shall try to place the program on the second station. This is designed to make programs more readily available to small-market stations fairly near large cities. In an inquiry on the same subject, the Commission seeks information as to what extent networks should 'be required to affiliate with or fur nish programs to such small-market stations, and what standards, such as distance, extent of additional coverage obtained, etc., should be used in determining that question. Part II of TV Network Progrom Procurement Report In July of 1965 the Commission sent to the Government Printing Office, for printing and sale to the public, the "Second Interim Report by the Office of Network Study, Television Network Program Pm curement, Part II." It is the second staff report on TV network programing practices;n connection withtheOommission's long inquiry into this subject (docket 12782). The first staff report, "Television Network Program Procurement Report" (1963), is also available from the Government Printing Office. Revision of Aurol Program Reporting Form After lengthy written comments, oral argument 'before the Com mission, ,test by several broadcasters, and extensive conferences with the Bureau of the Budget and industry representatives, the Commis sion on July 27, 1005, adopted a new program;ng section for its AM FEDERAL COMMUNICATIONS COMMISSION 1965 ANNuAL REPORT 97 and FM commercial broadcllBt application form (docket 13961). This is pursuant to the Commission's 1960 policy statement which obligates broadcasters to ascertain and serve the programing needs of the com munities in which they are located. The new form will be used by applicants for new stations, license renewals and transfers; also by applicants for major changes in existing stations if they propose a substantial change inprograming. Information is required as to the applicaut's efforts to ascertain and meet the broadcast needs and interests of his community, amount of commercial matter in sponsored programs as well as spot announce ments, and programs of certain types such as public affairs. Informa tion as to past programing will be required of assignors and transferors unless they have filed a renewal application within the past 18 months. At the same time, the Commission in a related proceeding (docket 14187) adopted new program logging rules to provide the information required by the new form. Work on a revised TV application form program section is continuing. Broadcast of Horse Racing Information In June 1964 the Commission decided not to adopt fixed rules govern ing the amount and type of information concerning horse racing which stations should broadcast. In so doing, it emphasized its continuing concern about the extent to which such information assists illegal gambling activities. It revised and clarified its earlier policy state ment on the subject, and stated that it would take advantage of offers of cooperation which had been received from groups in the horse racing industry. On April 9, 1965, it announced the formation of an Industry Ad visory Committee for the Horse Racing Industry, to act under the chairmanship of Commissioner Lee, the membership comprising 18 racing group representatives appointed by the National Association of State Racing Commissioners. The committee is to consider and ad vise the Commission concerning the broadcast of race track informa tion, including review of current practices, to determine whether they are furnishing aid to illegal gambling or are inhibiting the broadcast of legitimate racing information, and recommend any needed changes in policy. The committee held its first meeting on May 27, 1965. There was general agreement that information concerning racing now broadcast is not of substantial aid to illegal gambling. The committee will meet at least annually to review developments. 98 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT MULTIPLE OWNERSHIP Commission rules and policies are designed to prevent undue con centration and monopoly in the broadcast industry, to encourage com petition, and to provide the public with the widest possible range of program sources, ideas and viewpoints. Two aspects of this concept, represented in the multiple ownership rules and related policies, are: (1) To prevent common ownership of (or significant ownership or management interests in) two stations in the same service serving to a large extent the same population (so-called "duopoly" rules), and (2) to prevent undue concentration of control by limiting the number of stations in each service in which a single party may have a significant ownership or management interest to seven AM, FM, and TV stations, of which no more thanfive TVstations may be VHF. Problems have led to Commission recent actions along three lines- a more definitive ban on overlap between commonly owned stations; a restriction on acquisition of TVstations (especially VHF stations) in the 50 largest markets, and an inquiry into ownership by various invest ment entities in licensee corporations. Amendment of "Duopoly" Rules Prior to May 1964 the "duopoly" rules spoke in terms of stations in the respective services serving "substantially the same area." This general standard was found to be inadequate to insure the objectives of this rule when it was applied on a case-by-case basis along with other pertinent considerations. Therefore, the rules were changed to pro hibit common ownership, control or operation ofstations in each service having overlap of specified signal-intensity contours (1 mv/m for AM and FM, grade B for TV). On reconsideration, in September 1964 these rules were essentially reaffirmed with some relaxing modifications (docket 14711). As modified, they apply to applications for new stations, major changes, and acquisition by assignment or transfer of control. They do not require any divestment ofexisting facilities, but stations having prohibited overlap cannot be assigned or transferred to the same party except where the change comes about by reason of death or is of a pro forma nature. Nor do they apply to changes in facilities where the area of overlap will be no greater than that presently existing, topower increases by class IV AM stations, or to TV "satellite" operations. Also, in accordance with the Commission's policy of fostering UHF development, the rules do not apply to increases in the facilities of UHF-TV stations authorized before September 30, 1964, and where the overlap is with another TV station commonly owned as of that date. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNuAL REPORT 99 Restrictions on TV Acquisition in Large Markets The Commission has become concerned over the trend toward in creasing concentration of control of TV stations in the largest markets. For instance, in the top 10 markets (which have nearly 40 percent of the TV homes) 31 of the 40 VHF stations are owned by multiple owners and the other 3 are owned by local daily newspapers. In the top 50 markets (with almost 15 percent of the TV homes) 111 of 156 VHF stations have multiple owners. Of 40 VHF stations owned by the largest VHF holders, 22 are in the top 10 markets and 38 in the top 50 markets. Therefore, on December 18, 1964, the Commission announced an interim policy pending consideration of its multiple ownership rules. It stated that it would, in the absence of a compelling affirmative show ing, designate for hearing any application to acquire a VHF station in the top 50 markets by a party already having one ormore such stations or by a new party to acquire more than one suchstation. Following further consideration, the Commission on June 21, 1965, proposed to limit common ownership of TV stations in the top 50 markets to a total of 3, no more than 2 of which could be VHF (docket 16068). The rule would not require divestiture of existing holdings. Applications which contravene the proposed rule would be designated for hearing in the absence of a compelling affirmative showing. The reason for extending the proposal to UHF is concern lest the trend toward concentration affect the developing UHF service. Comments were invited on whether the proposed limitation is the most appropriate one, and on such questions as the significance of multiple ownership in producing "quality" programing, the effect of the proposal on possible establishment of a fourth TV network, and what long-term increase in diversity may be expected from the pro posed rules. Meredith Broadcasting Co. on August 20, 1965, appealed to court. Holdings in Widely Held Corporate Licensees An increasing number of broadcast stations are owned by corporate licensees whose stock is widely held and publicly traded (there are now some 38 such corporations). In numerous instances entities own sub stantial amounts of voting stock in two or more such corporations, thus exceeding the maximum number of stations in which a single party is permitted to have an interest, sometimes including stations in the same service in the same city. These situations contravene the multiple ownership rules, particularly where the holding is more than 1 percent of each corporation. These entities include mutual funds, banks hold. 100 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT ing stock as trustees, and brokerage houses holding for customers in "street name." Part of the problem is due to licensees failing to dis close the identity of the beneficial owner of stock held of record by another party. Since late 1963 the Commission has dealt with this problem in con nection with applications by a corporate licensee to acquire an addi tional station. In these cases the application is granted on condition that the mutua.! fund or other entity not vote its stock in excess of 1 percent in the applicant corporation pending resolution of the Com mission's inquiry into this subject. This inquiry (docket 15627) was commenced in September 1964. It seeks information concerning how the identity of the beneficial owners of widely held broadcast licensee stock may be ascertained, the extent to which stock in these licensees is owned by mutual funds and others, to whom stock ownership should be -attributed in the va.rious types of situations where the record owner is not the beneficial owner, and whether the Commission should adopt rules permitting it to proceed directly aga.inst the stockholder whose holdings caUSe the licensee to be in violation of the rules. The Com mission will also consider whether mutual funds and other entities holding stock for investment purposes should be exempted from the one-percent standa.rd. COMPARATIVE CRITERIA IN BROADCAST HEARINGS One of the Commission's primary broadcast responsibilities is to choose a.mong qualified applicants for the same facility, a process often involving extended hearings into a number of a.reas of comparison. The va.rious compa.rative fa.ctors cannot be assigned absolute values for all cases, and the degree of difference between applicants with respect to each varies greatly. Nevertheless, the Commission believes it desirable to ha.ve a general statement on its compa.ra.tive criteria and their a.pplication, both to insure a high degree of consistency in de cisions and to avoid delay in hearings through consideration of superfluous material. Accordingly, on July 28, 1965, it adopted a "Policy Statementon Comparative Broadcast Hearings." Emphasizing the two basic objectives of the comparative proces& to get the best practicable service to the public and to achieve maximum diversity of control-the statement covers six general areas of comparison: 1. Diversification 01 control 01 the media 01 mass communications is an important area. Consideration will be given to other holdings of the applicants, particularly in the same community orservice area, ta.k- FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 101 ing into account degree of control, size of the other holding (circula tion, audience, etc.), other media in the community or area, and regional or national significance; 2. full-lime parlicipalion by owners in sla/ion operalion, particularly in important positions, is significant, but substantially less weight will be given where the owner will spend less than full time, and none will be given if his position is merely a consulting one or the time is not on a daily basis. A slight credit will be given for an owner's local resi dence, and a very slight credit for past broadcast experience, where he will have a lesser degree of but still some role in station affairs; 3. Proposed program service, decisional significance will be given only to substantial differences between the proposals (which are often similar) . An applicant is expected to be familiar with his proposed community, and failure to make contacts with local civic and other groups in preparingthe proposal will be considered a serious deficiency even where the applicant is familiar with the area because of his back ground. Programing, staffing, and similar matters will not normally be considered under the standard comparative issues, and will be considered only on petition to enlarge issues; 4. Pasl broadcasl record (ownership interest and significant par ticipation in a broadcast station by one with an ownership interest in the applicant) may be of importance, if it is either unusually good or unusually poor, but itis not importantmerely by virtue of its existence; 5. Elf/cienl use of the frequency (differences in coverage between the proposals, etc.) will be considered where there is a substantial difference; 6. Significant charader deficiencies may be a comparative factor even though not sufficiently serious to warrant a disqualification issue; but, in order to avoid long hearings where one applicant searches for minor and remote blemishes in his opponent's past record, character evidence will be taken only if a substantial question is raised on a IIlDtion to add an issue. The Commission will continue to review its comparative criteria and judgments. Since the statement is basically of a clarifying nature, no earlier decisions will be reconsidered in light of its pronouncements. Existing hearing issues will not be changed, but the hearing examiner is expected to follow the statement in receiving evidence, and it will govern decisions. A petition seeking reconsideration of adoption ofthe statement has been filed. 789-224--66----8 102 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT FINANCIAL QUALIFICATIONS OF NEW APPLICANTS Now that the UHF television service is beginning extensive growth, the Commission is desirous of avoiding the earlier history of UHF economic failures which discouraged interest in and development of this service. Accordingly, a panel of Commissioners was appointed to consider what standards for financial qualification should be applied to applications for new UHF stations, particularly where there are threeVHF stations operating. In a May 1965 decision in three hearing cases (Ultravision B1'oaa casting 00. et cd.) the panel set forth a standard considerably higher than that which has been used in consideration of applications gen erally. On June 30, 1965, the full Commission issued its decision in these cases modifying somewhat the standard adopted by the panel, but also applying the same standard to AM, FM, and VHF applicants. Under the new standard, all applicants must show their financial ability to build the station and operate it for 1 year. Ifthe applicant relies on first-year revenues to meet fixed costs and operating expenses, he must show the basis for his estimate of revenues. In a clarifying notice issued July 7, 1965, the Commission stated that the new standard will apply to all applications for new UHF stations in markets with three or more VHF stations. Otherwise it will apply to all applications except those designated for hearing on or before July 2, 1965, which will be governed by the previous standard. A petition seeking reconsideration of this decision has been filed. LICENSE RENEWALS During the fiscal year, license renewal applications of 1,981 AM, FM, and TVstations and 490-TV translators were processed. An addi tional heavy part of the broadcast license renewal workload consists of special study and further processing required on applications which, because of unresolved problems, cannot be disposed of by the expiration of the regular license term and which, accordingly, become "deferred." Special efforts to reduce the number of stations in deferred renewal status, which were initiated in the spring of 1964, were pursued throughont fiscal 1965. As a result, the number of AM, FM, and TV stations in deferred status, which had reached an all:time high of nearly 700 on February 1, 1964, had been reduced to under 200 by June 30, 1965. Since nearly 600 stations whose licenses expired during this period had to be put on deferred status, the net reduction from about 700 to about 200 meant that over 1,000 deferred renewals were disposed of during this period. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 103 During fiscal 1965, the disposition of approximately 700 such de ferred renewals, coupled with the regular processing during the year of renewal applications, resulted in the handling of a record number of broadcast renewal matters. KEEPING OF PUBLIC FILES BY BROADCAST STATIONS On March 31, 1965, the Commission adopted rules which require broadcast stations and applicants for new stations to maintain files for public inspection in their communities (docket 14864). The material to be so kept consists primarily of major applications and ownership reports, together with related matter such as exhibits, documents in corporated by reference, and pertinent correspondence with the Com mission. Such material is now, and has been for years past, open for public inspection in the Washington offices of the Commission. Some applications require the submission of balance sheets as ex hibits, which, therefore, must appear in the local file. However, finan cial reports (showing revenues and expenditures) which are required to be submitted to the Commission annually are not open for public inspection at the Commission's offices and need not be made available for local inspection unless the applicant chooses to incorporate them by reference in an application. Nor need the financial books of a station be open to the public. The new rules are designed to further the policy of Congress, re flected in the 1960 amendments to the Communications Act, which seeks to assure to members of a community the opportunity to be informed about the broadcast stations serving them. Under the provisions of rules previously adopted to implement the 1960 amendments, parties filing major applications must give notice of the filing in local newspapers, over the air, or both. The new local inspection rules provide that, in addition to information previously required to be contained in the notice, there shall be a statement that a copy of the application is on file at a stated address in the community where it is open for public inspection. Petitions for reconsideration of the new rules are pending. BROADCAST STATION SALES The highest price yet paid for a single broadcast station was in volved in sale of WIIC(TV), channel 11, Pittsburgh, Pa., to WIlC 'l'V Corp., a subsidiary of Cox Broadcasting Corp., for $20.5 million. The transfer was granted by the Commission on November 20, 1964. The second highest price for a group ofstations was $21,141,330 paid for five Goodwill stations, four of which went to Capital Cities Broad- 104 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT casting Corp. for $15,141,330. These transfers were approved by the Commission on July 29, 1964. Calendar 1964 also saw the highest price for an FM station when WNCN, New York City, was sold to SN Network, Inc., for $467,000. This assignment of license was granted by the Commission on March 2 of that year. TALL ANTENNA TOWERS Considerable concern has been expressed over the increasing height of TV and FM radio antenna towers and their impact on the safety of air navigation. The public interest in both broadcast service and avia tion safety can and must be accommodated. Over the years, this goal has been substantially accomplished through close cooperation between the Commission and the Federal Aviation Agency and its predecessors. Joint efforts to bring this goal closer to full realization are continuing. On May 26, 1965, the Commission proposed that, after coordination with the FAA, it would adopt procedures looking toward establishing "antenna farms" for tall towers (docket 16030). Under this proposal, once an antenna farm has been established for a community, the Com mission would not accept an application for a new or modified tower exceeding 1,000 feet in height unless the applicant would locate it in the designated area or submit a statement from the FAA that the structure at the proposed location would not be a hazard to air naviga tion. Existing stations would not be required to move to "antenna farm" areas but could do so voluntarily. On the same date, the Commission adopted a policy statement which stated that the needs of the TV and FM services for antenna towers of adequate height, particularly with respect to the growing number of UHF television stations, can and should be realized within the limits of a realistic general height limitation, and concluded that this objective can best be achieved by adopting the following policy: Applications for antenna towers higher than 2,000 feet above ground will be presumed to be inconsistent with the public interest, and the applicant will have a burden of overcoming that strong presumption. Such a tower will be authorized only in the exceptional case where (1) the Commission concludes that a clear and compelling showing has been made; (2) the parties have complied with applicable FAA proce dures, and (3) after Commission coordination with FAA on the question of menace to air navigation. During fiscal 1965, eight additional TV transmitting towers in excess of 1,000 feet above ground were constructed; such towers now total 149. The tallest continues to be the 2,063-foot tower of KTHI-TV at Fargo, N. Dak. The second tallest tower (2,060 feet) will be that of FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 105 KXJB-TV now under construction at Valley City, N. Dak. Twenty eight construction permits for towers in excess of 1,000 feet were out standing, of which three were for 2,000 feet above ground-WEAU TV, Eau Claire, Wis.; the jointly used tower of KTIV and KVTV, Sioux City, Iowa, and KATV, Little Rock, Ark., on which the Arkansas Education Television Commission proposes to mount its channel 2 antenna. ENFORCEMENT The Commission continued its policy of vigorous enforcement of broadcast station requirements of the Communications Act and its own rules and regulations. During the fiscal period, license renewal applications of 12 broadcast stations were denied or dismissed, and the license of another station was revoked. At the end of the year, 20 pending hearings involved possible revocation or refusal of renewal. Notices of apparent liability for monetary forfeiture were sent to 38 licensees during the year, compared to 13 such notices in fiscal 1964, and 14 final forfeiture orders were issued. Twelve other licensees paid forfeitures without awaiting issuance of a final order. Short-term license renewals were issued to 21 stations. COMPLAINTS AND OTHER PUBLIC COMMENT Expressions of public opinion on broadcast matters received in fiscal 1965 totaled more than 35,000, of which approximately 21,000 were complaints about broadcasting. The remainder were expressions on the Commission's regulatory policies or were laundatory of stations or programs or were, in essence, requests or inquiries. The largest single category of complaints (34 percent) concerned programing. Complaints about advertising (the largest category in fiscal 1964) ranked second in 1965 with 32 percent, and complaints about operating practices amounted to 15 percent. COMPLIANCE Substantially more man-days were spent in field investigations of broadcast licensees than in fiscal 1964, although there was no increase in staff. A portion of the additional time was devoted to an expanded inquiry into payola allegations. To facilitate payola investigations, the Commission authorized the issuance of subpoenas by the Chair man to obtain records of companies or persons. Allegations of violations were the subject of field inqniry in 22 States during the year. Subjects of inquiry included unauthorized 106 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT transfers of control, fraudulent contests, character qualifications, misrepresentations, lack of properly licensed operators, and various otherviolations. SANCTIONS Revocation and Renewal Proceedings License renewal applications of 12 broadcast stations were denied or dismissed in fiscal 1965. These included three silent UHF television station (at Bethlehem and Lock Haven, Pa., and Bridgeport, Conn.) ; five silent AM stations; three radio stations dismissed for failure to prosecute, failure to reply to oflical correspondence, or at the request of the applicant; and one AM station (WHZN, Hazleton, Pa.) which surrendered its license after designation for hearing on issues concern ing misrepresentation and othermatters. Also, in July 1965 the Commission acted in two other renewal hear ing proceedings, involving stations KSHO-TV, Las Vegas, Nev., and WILD, Boston, Mass. In the first, renewal was denied because of misrepresentations concerning ownership and unauthorized transfer of control. In the second, in which the issues related to misrepre sentation and lack of candor, lotteries, and other matters, the hearing proceeding was suspended to give the licensee an opportunity to file an updated renewal application for Commission consideration, reflect ing changes in circumstances and practices. In addition, on July 24, 1964, the Commission revoked the license of WCLM(FM), Chicago, Ill. Grounds for revocation included abdica tion of licensee control, operation in a manner completely different from that proposed in renewal application, refusal to supply informa tion, and other violations (appealed to court, December 28, 1964). Two commonly owned AM stations were granted renewals for 1 year only following a hearing concerning misrepresentation and technical violations (KDAC, Fort Bragg, Calif., and KCHY, Cheyenne, Wyo., granted July 27, 1964). After hearings, the Commission granted regnlar renewals to 10 stations (3 TV, 6 AM, and 1 FM) and terminated 1 pending revocation proceeding by granting an assignment of license (WIZR, Johnstown, N.Y.). In two cases, involving three AM stations, Commission action re voking or denying renewal of license was reversed in court and the cases remand for further hearings. The first of these involved com monly owned stations WPFA, Pensacola, Fla. (revocation) and WMOZ, Mobile, Ala. (renewal), where the issues concerned falsifica tion of logs and other misrepresentations (remanded February 25, 1965). The second was station WGMA, Hollywood, Fla., where the FEDERAL COMMUNICATIONS COMMISSION 1965 ANNuAL REPORT 107 issue was the character qualifications of licensee principals who had been involved in TV network "rigged" quiz shows (remanded AprilS, 1965). Seven other renewal applications were designated for hearing on issues relating to the applicants' qualifications and similarmatters, and the proceedings are still pending. These, with the date of designation and the chief matters involved, were: WOOK, Washington, D.C., January 19, 1965; multiple violations of technical rules, improper log maintenance and exercise of control and supervision by the licensee. WTID, Newport News, Va., April 28, 1965; misrepresentation, filing false information, failure to disclose pertinent information concerning ownership and control, lack of adequate control, unauthorized relin quishment of control, and character qualifications. WKSB. Milford. Del., May 5. 1965; repeated rule violations, lack of proper control and supervision, misrepresentation. failure to file required annual financial reports, and financial qualifications. KBMT(TV) and KPAG-TV, Beaumont, Tex., May 5, 1965 j misrep resentation and character qualifications arising out of conflicting claims concerning KBMT's application to change facilities and KPAQ-TV's opposition thereto. KMRE, Anderson, Calif., June 2, 1965 j unauthorized transfer ofcon~ trol, misrepresentation, failure to file reports, rule violations including unauthorized silence, and lack of proper supervision and control. WJNR, Newark, N.J., June 9, 1965; time brokerage contract, mis· representation, lack of adequate supervision and control, failure to make sponsorship identification, and character qualifications. Two other renewal applications were set for hearing for other rea sons-Station WBVL, Barbourville, Ky., hecause of the filing of a new application for the same facilities, and KGMO, Cape Girardeau, Mo., in connection with its economic objection to an application for an additional radio station in that city. Other renewal or revocation proceedings involving character and similar matters, designated in prior years, remaining pending at the end of fiscal 1965 were: WKYN and WFMQ(FM), San Juan, P.R., and WORA-FM, Mayaguez, P.R. (all revocation) ; rebroadcasting without permission in violation of section 325(a) of the Communications Act; forfeiture may be imposed in lieu of revocation (initial decision proposed to revoke, remanded by Commission for further evidence). WTIF, Tifton, Ga. (revocation) and WDMG, Douglas, Ga., and WMEN, Tallahassee, Fla. (renewals); unauthorized transfer,mis~ representation, conspiracy to bar construction of a broadcast facility (initial decision proposed to grant the applications). The renewal application of station WHDH-TV, Boston, continued in hearing along with competing applications for the same facilities. 108 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT In two other cases involving renewals and oompeting applications, renewal was granted. These involved station WCKT (TV), Miami (competing applications denied) and WXFM, Elmwood Park, Ill. (competing applications dismissed). Short-Term Licenses Because their past records indicated the need for closer super vision, a total of 19 stations (13 AM, 5 FM, and 1 TV) received license renewals during the year for terms less than the normal 3-year period (in addition to the 2 hearing cases mentioned above). In some cases these included commonly owned AM and FM stations, and in one case an AM-FM-TV combination in the same city. The number of licensees involved was 12. The reasons for these probationary re newals included fraudulent contests, unauthorized assignments of license, time brokerage contracts, improper log keeping, and the broad cast of "scare" promotional announcements. Forfeiture Proceedings Sections 503 and 504 of the Communications Act authorize the Commission to hold broadcast licensees liable for monetary forfei tures up to $10,000 for certain violations which do not warrant revo cation of license. Such forfeitures are payable to the U.S. Treasury. During the fiscal year, notices of apparent liability were issued to 38 stations, compared to 13 such notices in fiscal 1964. The great majority were AM stations. Of the 1965 total, 19 paid the amount set forth in the notice; 5 responded and were permitted to pay lesser amounts, and 1 was later relieved of liabiliy. In addition, four orders of forfeiture were issued in proceedings begun earlier. The amount of the forfeiture varies with the number and serious ness of the violations. The largest ordered during the year was $8,000, to the licensee of WMIE(AM) and WEDR(FM), Miami, Fla., for lack of control over program content. Other amounts over $1,000 assessed were: WTUP, Tupelo, Miss.. lack of proper degree of licensee responsibility in station operation ($5.000). WBNX. New York City, violation of logging and sponsor identification rules ($5,000). KRIG, Odessa, Tex., violation of first-class operator rule ($5,000, later reduced to $1.000). KALI, San Gabriel, Calif., failure to originate the majority of its programs from its main studio ($4,000). WDBQ. Dubuque, Ill., failure to reduce power at night as required by its license, and operation without a licensed operator on duty ($2,000, later reduced to $1,500). FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 109 Other violations leading to forfeitures included numerous instances of failure to employ first-class operators to the extent required by the rules ($500 to $1,000) and other violations of the operator rules; sev eral unauthorized assignments of license or transfers of control ($500 or $1,000) ; operating nondirectionally at night and by remote control without authority ($1,000) ; operating changed facilities without prior program test authority ($100); failure to keep maintenance logs ($500) ; broadcasting advertisements involving a lottery ($350); re broadcast without the originating station's consent ($250, later reduced to $100); failure to maintain modulation within tolerance ($250 or $500); failure to make required filing of time-brokerage contracts ($500); and failure to make a required sponsorship announcement in connection with a political broadcast ($1,000; the station, WHAS TV, Louisville, is contesting this in court). A total of $34,150 in forfeitures was paid by stations during the fiscal year. Some Developments After Sanctions In 1955, the National Broadcasting Co., Inc., and Westinghouse Broadcasting Co., Inc., applied for and received consent to exchange hroadcast properties in Philadelphia and Cleveland-NBC acquiring WRCV and WRCV-TV, Philadelphia, and Westinghouse acquiring KYW, KYW-FM and KYW-TV, Cleveland. After extensive liti gation in court and hearings before the Commission, the Commission ruled in June 1964 that NBC had improperly forced Westinghouse into the exchange by use of its power as a major TV network to grant or withhold affiliation, and ordered restoration of the situation as it existed before the exchange. The Commission's action was appealed by another party, but the appeal was dismissed and, on June 19, 1965, the Commission's order for the exchange was effectuated. In actions of recent years, the Commission denied the renewal of license of KRLA (AM), Pasadena, Calif., and revoked the license of h.-w'K(AM), St. Louis, Mo. (the decisions became final by virtue of court actions in November 1963 and March 1965 respectively). In both cases, deletion of the station was followed by many applications for use of the frequency in the same community or area. There are 14 applicants in the hearing for KRLA's frequency (5 others having dismissed their applications), and 17 applications have been received for that of KWK. KRLA's facilities are being operated by another party on an interim basis, and the same arrangement is proposed for KWK when it ceases operation. 110 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT TELEVISION lTV) BROADCAST SERVICE UHF Development With all TV receivers shipped in interstate commerce or imported now required to be able to receive all channels, the UHF portion of the video service has continued to develop. Seven comparative hear ings between two applicants for UHF channels were in progress. Use of all 82 TV channels (70 UHF as well as the 12 VHF) is neces sary if the Nation is to have fully adequate TV service. It was to overcome the obstacle created by the prevalence of VHF-only receivers that the Commission sought from Congress the 1962 all-channel legis lation and adopted the all-channel set rules. Despite the predictions of manufacturers that there would be a $25 to $30 increase in TV receiver prices at the retail level caused by the requirement to include UHF tuners, there was, in fact, a general price reduction of all-channel receivers compared to their VHF-only counterparts. The wholesale price index for TV receivers, as re ported by the Department of Labor, dropped from 87.3 in June 1964 to 85.9 in June 1965 (the prices for years 1957 to 1959 100). Excise tax removal further reduced retail prices with many companies cut ting the tax before the law went into effect. The White House an nounced on August 18, 1965, that 75 percent of the retailers in small cities and 60 percent in large cities were passing excise tax savings on to the public. Advisory committee on UHF.-The Committee for the Full Develop ment of All-Channel Broadcasting, which was formed on March 12, 1963, completed its work pertaining to toohnical phases and consumer information. In February 1965, the technical group made its final report, which consists of five subcommittee reports dealing with all channel receivers, UHF antennas and receiving systems, transmitting and studio equipment, also consideration of spot announcements for translator stations. Of particular interest to UHF broadcasters are sections on considerations in selecting transmitting antennas, manu facturers' test procedures, installation, final test and maintenance. On March 11, 1965, the Commission authorized the committee to con tinue work pertaining to information on UHF station operation. Matters under study include the availability of programs andthe effects of pay-TV, CATV and TV ratings on UHF operations. The committee has recommended possible rule changes requiring affiliation of stations by networks under certain circumstances, and is giving continued consideration to the feasibility of a fourth national network. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 111 Upon a recommendation of this group, the Commission obtained the cooperation of the Bureau of the Census on a TV supplement to the August 1965 population survey. These data and similar data to be obtained in future supplements will be helpful indetermining thenum ber of all-channel and color receivers in the hands of the public and the number of housholds receiving UHF other than by all-channel receiv ers, such as master antennas, CATV, converters or othermeans. UHF allocations.-On June 3,1965, the Commission issued a revised table of UHF channel allocations (docket 14229). Through the use of the Commission's own electronic computer, it was possible for the first time to accurately assess the impact of each assignment on other potentialchannel assignments and choose assiguments for each city that would leave the largest number of channels available for assignment to other cities. The high-speed calculation capability of the computer performed in a matter of days a task that would have taken engineers several years to accomplish manually. The revised table makes over 1,000 UHF assignments in the contin ental United States, of which number about 500 are reserved for educa tion. The total is less than that in the previous table because it was decided not to assign commercial channels to cities of less than 25,000 population except where a demand has been shown. It was believed that the needs of these smaller cities may be better served by a new type of "community" TV station, operating with relatively small facilities. With stations of lesser power, it is possible to make many more assign ments on each channel because they can be separated from each other at less distances without undue interference. Since few stations are now authorized on channels 70 to 83, it was tentatively decided to re serve ti,ese channels for this type ofstation. Moreover, with respect to channels 14 through 69, the plan is by no means a saturated one. Inmany parts of the country it will be possible to make further assignments on these channels where needed. By means of the electronic computer, the Commission will be constantly informed as to remaining availabilities so as to maintain a fair and equitable distribution of assiguments among the various States and communities. The "community" type station, proposed at the same time the neW UHF table was adopted, would be limited to 10 kw effective radiated power and an antenna height of 300 feet above average terrain, giving it a service radius of about 16 miles. Communities would be eligible for a community station regardless of whether they have a regular channel assignment. However, no community station would be au thorized in orclose to an urbanized area, and no community could have such a station if it is within 10 miles of an existing community station. 112 F'EDERAL COMMUNICATIONs COMMISSION I 9 6 5 ANNUAL REPORT It has been the Commission's experience that TV channels asigned to smaller communities close to larger cities tend to become merely an additional channel for the large city. "Idle" UHF authori.ations.-As part of its effort to spur UHF de velopment, the Commission took steps during fiscal 1965 to delete UHF authorizations where the stations have not constructed or are otherwise inoperative, thus making these channels availahle for applicants who will use them. Letters were sent to the "idle" permittees or licensees in November 1964. In May 1965, on the basis of the replies received, the Commission held oral argument on their applications for more time to build orget on the air. On June 17, 1965, the Commission extended the construction permits of 13 permittees, based upon representations made at the oral argu ment that they would construct within a 6-month period; denied with out prejudice the applications of five permittees for extensions of time and two applications for license renewals; dismissed without prejudice one renewal application and ordered one license application held in abeyance for 6 months. The Commission's decision reflects its policy that no extension of time for construction will be granted without a showing of causes beyond the control of the permittee. Neither local scarcity of UHF receivers nor a market's limited revenue potential is deemed cause for delayed construction or operation. VHF Assignments VHF assignments were not included in the UHF allocation proceed ing. The Commission made several changes in individual VHF assign ments during the year, where the public interest appeared to warrant it, including additional educational reservations. One important con sideration in VHF assignment proceedings is the possible impact of the proposed assignment on the development of UHF. This was one of the reasons for denying requests to assign VHF channels in the Staunton-Waynesboro (Va.) and San Francisco areas and a request to move a VHF channel from Bloomington (Ind.) to Indianapolis. In line with the same policy, the Commission denied requests which essentially sought reversal of its 1963 decision not to make short spaced VHF "drop-in" assignments in major markets. Educational TV Interest in noncommercial educational TV continued to increase during fiscal 1965, with 15 new stations-the largest number in any year thus far-beginning operation. Nearly every major city in the United States now has at least one ETV station. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 113 A total of 621 VHF and UHF channel assignments are now reserved for noncommercial educational operation. This number is believed adequate, especially with the development of the new Instructional Television Fixed Service in a higher frequency band, which can be used for in-school instruction. The allocation table provides for statewide ETV coverage. However, educational interests have peti tioned for reconsideration of their allocations. Airborne ETV.-Since September 1961 an experimental airborne edu cational ETV operation has been conducted from a plane circling over Montpelier, Ind., first by Purdue University and later by the Midwest Program for Airborne Television Instruction, Inc. (MPATI), an association of schools and colleges. Videotapes are broadcast from the plane on UHF channels 72 and 76 to about 2,000 schools in por tions of Ohio, Michigan, Kentucky, Indiana, Illinois, and Wisconsin. Translators on other high UHF channels are used to improve school reception in Chicago, Detroit, and Cleveland. In October 1963 the Commission instituted rulemaking (docket 15201) on MPATI's request for regnlar operation on these and four additional UHF channels (74,78,80, and 82). After oral argnment in October 1964, the Commission on June 30, 1965 concluded that MPATI's request should be denied and its operation in the UHF broadcast band ultimately terminated. The operation has been the subject of controversy, being opposed by some educational groups such as the National Association of Educational Broadcasters and the National Eduction Association and favored by other groups. Because of the high altitude of the transmitter, such an operation precludes other use of these and adjacent UHF channels within a wide area, and grant of MPATI's request would have adversely affected the number of regular UHF assignments which can be made in most of Indiana and Ohio, as well as parts of Illinois, Iowa, Kentucky, Michi gan, Pennsylvania, Tennessee, Virginia, West Virginia and Wisconsin, also Ontario, Canada. The Commission recognized the high quality of MPATI's programs, its valuable service especially to small schools in Midwestern rural areas which could not otherwise afford educational TV, and its con tribution to the development of cooperative instructional tech niques. But it believed that the operation would deprive communities of the opportunity for ground-based UHF assignments, both commer cial and educational, which can provide in-home service to the general public as well as in-school material. This decision was reached in light of the availability of the new Instructional Television Fixed Service, where such a specialized service could be conducted. Accord ingly, it invited MPATI to apply for six channels in that auxiliary 114 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT service on which to conduct airborne ETV operations on a regular basis. MPATI will be permitted to operate on channels 72 and 76 for 5 more years so that its investment may be amortized. It has asked reconsideration of the Commission's decision. Inslructional TV Fixed Service.-In 1963 the Commission established an Instructional Television Fixed Service, in the 2500-2690 Me fre quency range, to provide multiple channels for the simultaneous trans mission of instructional material to schools and colleges. It offers a particular boon to education's use of TV as an instructional medium. It permits a single central transmitter to serve a number of scattered schools, where the transmissions are converted for classroom viewing on regular TV receivers. It alleviates the need for using regular ETV broadcast channels for in-school instruction. As of June 30, 1965, 33 authorizations had been granted, of which number four systems were operating. Expansion is expected as edu cational institutions become familiar with the new services. On October 11, 1965, the Commission announced the establishment of a national committee to develop the instructional TV fixed service. Subscription TV In 1959 the Commission announced that it would consider, under certain conditions, applications for subscription TV operations on a trial basis, to aid the Commission in making ultimate decision as to regular pay-TV service (docket 11279). In June 1962, RKO Gen eral Phonevision, Inc., began such an operation over TV station WHCT, Hartford, Conn., using equipment manufactured by Zenith Radio Corp. which scrambles the audio and visual siguals at the trans mitter and unscrambles them by means of a decoder attached to the subscriber's set. It has about 5,000 subscribers. Subscription pro graming is presented for approximately 30 hours a week, more than 85 percent of it being feature films and the rest plays, opera and ballet, concerts and recitals, live sports, variety, and educational pro grams. The station also broadcasts conventional free TV programs, as required by its authorization. This is the only over-the-air snb scription operation currently being conducted (the one other authori zation granted since 1957, for Denver, was permitted to lapse). In March 1965, RKO filed a request for an extension WHCT's authorization (which would have expired in June 1965) and Zenith filed a petition looking toward nationwide pay-TV. The former, opposed by Hartford-area motion picture owners, was granted for 3 more years since it appeared that further trial would provide help ful information. The Zenith petition requests further rulemaking in docket 11279 to expand this service and remove some of the limita- FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 115 tions prescribed on pay-TV operations. It asks, among other things, that each system, such as Zenith's, be permitted to have more than the' one city in which to operate and that no limitation on subscription broadcast hours be imposed. It proposes that no commercials be permitted during subscription programing, and that such program ing be required to be of a "box-office" nature rather than duplicating conventional TV fare. Because of the scope of this proposal, the. time for filing responses to this petition (docket 11279) was extended. The Commission does not now directly license or otherwise regn late wire or cable pay-TV, bnt it is following developments in this area closely. One cable system, Subscription Television, Inc., began service in Los Angeles and San Francisco in 1964 but ceased as the result of a vote in November 1964 banning such operations in Cali fornia. In May 1965 a California superior court held the ban uncon stitutional. This ruling has been appealed to the highest California court. It is reported that plans for wire pay-TV systems in Atlanta, Dallas, Houston, Miami and other cities, which were dampened by the California vote, have been revived as a result of the court ruIing. RRO General reported that it had obtained options on the Zenith sys tem in five markets-New York City, New Haven, Philadelphia, Washington, and San Francisco. CATV Systems See separate chapter on this subject. TV Translators Television translators are low-power stations which pick up reguIar TV station signals and rebroadcast them on another TV channel, originating no material. UHF translators on channels 70 and above were first authorized in 1956 and may operate with up to 100 watts power. VHF translators, limited to 1 watt, were first authorized in 1960. Translators are designed to serve remote and unserved areas. Their use continued to increase during the year. As part of its contiouing effort to bring increased and improved TV service to smaller communities and rural areas, the Commission during the year studied means of extending and improving translator service. In February 1965 it proposed licensing 100-watt translators on any VHF or UHF channel assignment not occupied by a reguIar TV station (docket 15858). This was in response to requests by a number ofTVlicensees and other parties, chiefly in the FarWest. The proposal was adopted on July 7, 1965. The Commission has under consideration other proposals to im prove and extend translator service, including higher power for all 116 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT or at least for those using channels in the assignment table, permitting translators to use microwave facilities as relays, and relaxation of translator identification requirements. Translators sometimes operate in communities having a regular TV station or near one. In some instances, the local station has objected on economic grounds, similar to objection to microwave facilities for CATV systems. In a decision authorizing a translator at Fort Myers Fla., the Commission set forth its policy in such cases-i.e., where a translator is within the predicted grade A contour of a regular TV station, the grant will be conditioned on the outcome of docket 15971, concerning translator duplication of programs of a regular station. In the interim, any grant will also be conditioned on the translator's not duplicating the regular station's programs simultaneously or for 15 days before or after, if the regular station so requests (as in the case of CATV). The Commission will, however, consider petitions bringing to its attention public interest reasons as to why a different interim policy should be adopted in particular cases. Color TV Production and sale of color TV receivers continued their upward surge and more programs in color were scheduled for the 1965-66 season. Color set prices declined. The number of stations equipped for colorcasts was approaching 500. Industry estimated 3.6 million color sets in use. TV Stereophonic Sound On November 12, 1964, the Commission launched an inquiry (docket 15697) to determine whether stereophonic sound, now used in FM broadcasting, should also be authorized for the audio (FM) portion of TV broadcasting. On petition, the time for filing comments was ex tended into fiscal 1966. FREQUENCY MODULATION IFMI BROADCAST SERVICE FM Expansion Interest in and expansion of FM broadcast continued. Industry estimates that the number of radio sets able to receive FM sold in the United States in calendar 1965 will reach a new high of 7,570,000. The percentage of homes able to receive FM has correspondingly in creased, especially in large cities. A recent industry survey sets it at 51.3 percent in New York City and no less than 31.1 percent in nine other cities. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 117 The interest in this service appears to stem from several sources. Many licensees of daytime-only AM stations look to it as the only way to provide nighttime radio service to their communities in view of the crowded state of the AM band. This is particularly significant when it is noted that in many rural counties one or more daytime only AM stations are the only broadcast outlets. Other AM licensees seek to extend their nighttime coverage, which is often highly limited on AM because of the multiplicity of stations. Stereophonic broad casting on FM offers the public an additional service. Through Sub sidiary Communications Authorizations, many FM stations offer auxiliary services such as storecasting and background music. Also, the appearance of inexpensive FM receivers on the market has given the service an added boost. FM Channel Assignments In 1963, in the overall FM rule making proceeding (docket 14185), the Commission adopted new technical rules and established a nation wide table of FM channel assignments similar to that used in the TV service. In addition to the large number of applications filed, and stations going on the air, many petitions requested changes in the FM assignment table, such as providing a first FM channel in a com munity, a change from one class of channel to another, etc. During the year, 19 such rule making proceedings were started and completed. These involved 67 petitions, most of which were granted. Eight pe titions were denied without rule making because they requested assign ments which did not conform to the rules or were otherwise deemed not to be in the public interest. At the yearend, 11 proceedings were pending. Improvement in existing stations.-The FMassignment table is based on certain minimum mileage separations between co-channel and ad jacent-channel stations adopted in 1962. Many stations authorized under earlier assignment rules are located at less than these separa tions, and some way had to be found for permitting them to increase facilities, which are often limited in power and antenna height. On October 7, 1964, a Fourth Report and Order was adopted in docket 14185, under which stations short-spaced to other stations on the same and immediately adjacent channels may increase facilities, depending on the extent to which they are short-spaced, according to a mileage table added to the rules. Many stations have been granted such increased facilities. Thus they are able to provide better signals within their service areas and in some cases extend their coverage. In 789-224-66-9 118 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT two cases the Commission permitted pairs of short-spaced stations to increase facilities to the maximum where both stations desired to do so and it appeared that the public interest would be served. The same order established, for the first time, a table of FM as signments for Alaska, Hawaii, Guam, Puerto Rico and the Virgin Islands, lifting a "freeze" which had been in effect while this matter was under consideration. Interference conslderations.-FMbroadcast stations are assigned and operate on frequencies from 88.1 to 107.9 Me. The second harmonic of all these frequencies (twice the fundamental frequency) falls with in the high VHF TV band channels 7 through 13. Thus, the radiation of any FM signal close by can be a source of interference to reception of those TV channels. Because of the increase in the number of FM stations this has presented a problem. In order to explain the matter to the general public and to indicate what measures can be taken to avoid or to reduce this type of inter ference, the Commission in February 1965 issued and widely dis tributed a bulletin on the subject. It explained that the potential in terference to TV reception from FM stations is of two types: One is caused by the direct second harmonic radiation of the FM station and the second is due to the generation of a second harmonic signal within the TV receiver caused b}' overloading of the fundamental signal from the local FM station. The former type lends itself to correction at the FM station; the latter can be remedied only at the TV receiver by the installation of filters or "wavetraps." The bulletin called on all interests concerned-manufacturers, FM station licensees and the general public-to cooperate to insure that both the FM and TV serv ices function without adverse effect on each other. In some cases the Commission has been able to make channel changes to eliminate this problem but, as stated in the bulletin, this cannot be done in every case without sacrificing the making of desirable FM assignments. On June 30 the Commission adopted a rule (docket 15934) mak ing more specific the principle of not assigning FM channels 53 or 54 (10.6 or 10.8 Me) in close proximity. This ishecause of interference arising from the fact that the intermediate frequency amplifiers of most FM receivers use a frequency of 10.7 Me. Umitation on FM-AM Program Duplication Hitherto, there has been no restriction on the presentation of iden tical programs on commonly owned FM and AM stations, and many AM-FM station combinations present the same material at the same time during their broadcast hours, using the FM station as an ad junct of the AM. FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 119 Obviously it is a wast. of valuable spectrum space to use two fre quencies to bring the same material to the same location. This has been permitted in the past becanse it provided an easy and inexpen sive start for FM broadcast. However, with the mounting number of FMsets and growing interest in the medium and competition for chan nels especially in the larger cities, the Commission in 1963 proposed a rule limiting the extent to which this essentially wasteful practice could be engaged in (docket 15084) . It culminated on July 1, 1964, with the adoption of a rule providing that no FM station in a city of over 100,000 population can devote more than 50 percent of its average broadcast week to duplication of the programing of a commonly owned AM station in the same local area. "Duplication" is defined to include presentation of the same material simultanequsly or within 24 hours before or after it is presented on the AM station. This rule was affirmed in March 1965 but the effec tive date was postponed from Augnst 1, 1965, to the followjng October 15. It applies to cities of over 100,000 population because FM channels in these cities are scarce and in demand, and it is unreasonable to per mit a licensee under these condjtions to use two channels for the same program. The Commission believes that this nonduplication require ment will further spur the development of FM. Permitting 50 per cent duplication will still permit an AM-FM broadcaster to dupli cate news and considerable other programing if he wishes to do so. The Commission provided that requests for exemption could be filed and 109 such requests were received up to Jnne 30, 1965. The fol lowing month it granted 106 exemptions until December 31, 1965, and three requests for temporary exemption until April 15, 1966. Educational PM Revjsion of the noncommercial educational FM broadcast rules as contemplated in docket 14185 has not as yet been completed. Con sideration has been given to adopting a table of educational FM chan nel assignments. However, it is difficult to predict where the demand for stations will exist, or what should he appropriate limits on facili ties for different educational needs. Furthermore, the problem of preventing interference to TVstations on channel 6 (82 to 88 Me) from FM stations in the adjacent educational FM band (88 to 92 Me) is a difficult one. In the past it has been necessary to move some educa tional FM stations to chamie1s in the commercial portion of the FM hand (92 to 108 Me) to eliminate interference. In the meantime, the processing of applications for the educational FM band continnes on a case-by-case consideration, on the basis of 120 FEDERAL COMMUNICATIONS COMMISSION lQ65 ANNUAL REPORT protecting the 1 millivolt-per-meter contour. of other stations in this band and mileage separations between stations on the top three educa tional channels and the lower three commercial channels. STANDARD IAMI BROADCAST SERVICE AM Rules Revised On July 1, 1964, the Commission revised its AM station assignment rules and lifted the partial "freeze" on AM applications for new or changed facilities while this proceeding (docket 15084) was pending. With respect to daytime facilities, the new rules bar applications which involve an overlap of specified signal-intensity contours with stations on the same channel or adjacent (first, second, and third) channels. A greater degree of overlap is permitted where the sta tion is or would be the first local station in a community or would serve 25 percent or more "white area" within the proposed 0.5 mv/m contour. As to nighttime facilities, the proposed assignment must not cause objectionable interference to any other station and must serve 25 percent "white area." In March 1965 these rules were generally affirmed on reconsidera tion. There were certain modifications of a relaxing nature with re spect to the daytime rules (permitting a change in facilities creating new overlap area but not an overall increase, disregarding overlap occurring entirely over sea water, and providing for consideration of assignments near the U.S. borders on the basis of international standards). The rate of applications under the new rules is about the same as under those in effect before May 1962, when the "freeze" was imposed. Applications are screened before acceptance andltbout 30 percent of them are found not to comply. These are returned unless a petition for waiver is filed and granted. Emergency AM Operation Under rules liberalized and clarified in 1964, daytime-only AM sta tions may operate outside of authorized hours in times of actual or threatened weather or other emergency if it is essential to the safety of life and property and if no full-time station is providing emergency information to the same area. Full-time stations may use their often greater daytime facilities during nighttime hours subject to the same general conditions. This use extends to announcement of school dos- FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 121 ings and changes in school bus schedules resulting from inclement weather if adequate warning cannot be given during licensed hours. The operation must be noncommercial and consist only of announce ments concerning the emergency and intervening music, and must be reported to the Commission as soon as possible. During ,fiscal 1965 approximately 135 AM stations engaged in such operation. INTERNATIONAL BROADCAST STATIONS Three international broadcast stations now operate under Commis sion authorizations-WRUL, Scituate, Mass., which broadcasts to Mexico, Central and South America, 'Vestern Europe and Western Africa; KGEI, Belmont, Calif., which broadcasts to Mexico and Central and South America; and 'VINB, Red Lion, Pa., which broad casts to the Mediterranean area, including parts of Southern Europe, Northern Africa and the Holy Land. Two applications to construct new stations are on file, as is an appli cation of KGEI to extend its service to Japan. No action is being taken on them because of the Commission's "freeze" on applications for new international stations and for increases in operating hours of existing stations. The "freeze" was imposed in 1963 pending Commis sion study of its international broadcast rules with a view toward needed revision. By far the greatest amount of international broadcasting from the United States is done by the U.S. Information Agency through its "Voice of America" service. MISCELLANEOUS BROADCAST SERVICES Over 9,750 miscellaneous broadcast st",tions are used for various auxiliary purposes. Some 7,700 engage in remote pickupof programs; others link studios and transmitters; some furnish educational TV links ; and still others provide facilities for broadcast experimentation and development. STATISTICS Current Broadcast Authorizations The 18,544 broadcast authorizations outstanding at the close of fiscal 1965 represented a netgain of 1,313 fur theyear. 122 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT Authorizations for the different classes of broadcast services at the yearend were: c"'"' Commercial AM••_._~~~_ Commercial TV __ _ . _ TV translators and boosters________ _ . . __ Educational TV•• • • • • Instructional TVfil:ed.~_._~_••__~~. _ Auxiliary . _ Expl;ll'imental TV__ • • •• ._ Commercial FM••~__~~~____ _ Educational FM__ • _ InternationaL _ Remote pickup_______________ ___ • _ Stud1()-transmitter-link _ DevelopmentaL _ __ ____ _ _ _ Low·power auxiliary (cueing) • _ TotaL _ -~....._- June 30, 19M June 30,1965 Increase or (decrease) 4,061 4.~ 36 668 21 1,913 2.023 110 107 12<5 18 • 33 29 I,MiD 1,688 129 28 2<5 (3) 1,371 1,~ 194 257 "8 3 0 7,I12ll 7,748 728 121 143 22 8 • (1) 113 128 16 17,231 18,544 1,313 Status of Broadcast Authorizations Of the 8,771 AM, TV and FM broadcast stations authorized at the close of fiscal 1965, 8,073 had operating authorizations and 698 others held construction permits. A breakdown follows: Class Operating Construction authori7.8tions pennits Commercial AM_________ 4,026 72 Commercial TV 589 100 'I'V translators_ __ _ 1,762 261 Educational TV _ _ __ __ __ __ _ Q2 33 C102 17. 3100 Federal Office Bldg., Kansas City, Mo., 64106 18. 1872 New U.S. Courthouse andl!~ederalOffice Bldg., Chicago, IlL, 60604 19. 1029 New)j~ederalBldg., Detroit, Mich., 48226 20. 328 Federal Bldg., Buffalo, N.Y., 14203 21. 502 Federal Bldg., Honolulu, Hawaii, 96808 (P.O. Box 1021) 22. 322-323 Fe-deral Bldg., San Juan, P.R., 00003 (P.O. Box 2987) 23. 53 U.S. Post Office and Courthouse Bldg., Anchorage, Alaska, 99501 (P.O. Box 644) 24. 521 12th St., N.W., Washington, D.C., 20555 Class A stations Allegan, Mich. Canandaigua, N. Y. Fort Lauderdale, Fla. Grand bland, Nebr. Kingsville, Tex. Laurel, Md. Livermore, Calif. Powder Springs, Ga. Santa Ana, Calif. Waipahu, Hawaii Clas~B SttltiOlf8 Ambrose, Tex. Anchorage, Alaska Chillicothe, Ohio Douglas, Ariz. Fairbanks, Alaska Spokane, \Vash. STATISTICS Cla~.~e.~tfltiOn8 JIarietta, Wash. Winter Harbor, Maine Field engineering statistics for fiscal 1965 in comparison with those of 1964 follow: Inspection statIstics Stations United States Foreign 1964 1965 1964 1965 Skip ----1------------ Authorized stations__ Compulsory: Inspections_ __ _ _ Discrepancy notices. _ Items cleated during inspect!on _ Certificates issued'___ _ _ Voluntary: Inspections -- Discrepancy notlces _ BrrxuktJ.1jt Authorized stations ,._ Inspectlons.__~_ Discrepancy notices: Inspections ,_ Inspection momtorlng _ Other services f Authorjud ststlons _ Inspections _ Discrepancy notices: Inspectlons. . _ Inspection monitoring _ 190,000 111,690 4,743 24,037 156 162 J,653 1,622 43 32 4,054 3934 116 16U 2,853 2: 447 130 128 1,833 3,101 9,''' 1,510 17,231 18,544 2,061 2,149 ---------. ---------- 2,121 2,252 415 520 986,961 1,074,891 5,831 9,045 2,707 4,553 1,208 1, [j!j7 ---------- ------ 1 Previously reported 159,390 total reduced hy computer reoount. I Decrease due largely «I ship strike. 3 Safety Convention, Communications Act Safety Radiotelephony and Great Lakes Agreement Radio telephony Certificates. • Excludes ship, broadcast, and amateur. 162 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT Investigative statistics Interference complaints received by FCC: Interference to TV .______ _ _ Interference to aural broadcast- _ Interferenoo to other services _ Total _ Interference cases investigated by FCC. _ Other investigations by FCC _ TotaL . . _ Number of cooperative Interference committees _ Number of TV interference commlttees _ Total _ Number ofunlicensed stations found in violation of Communica- tions ACL . _ ~e=~~t~6~~~~~~(CbY-users-of-isr;fequfpment~~~=~- 1964 1965 Increase or (decrease) ----- 27,135 24,892 I (2,243) 3,725 4,052 327 7,381 5,948 (1,433) 38,241 34,892 3,M9 18,922 23, <20 4,498 2,881 1,612 2 (1,269) 21,803 25,032 3,229 41 41 0 758 327 " 799 868 " 'SO '" (136) 47 66 I' ." .'" (83) I Increase In TV! Committees may account for decrease in TV Interference complaints. 2 Technological improvements and decrease in number of unlicensed stations contributed to the decrease in "other Investigations:' Monitoring stati.'1tic.s 1964 1965 Increase or (decrease) 834 787 (47) 126 165 .. 1,406 1,773 367 30 I' (11) 2,396 2,744 348 3,354 3,462 108 32 603 571 28,837 29,086 ". 481 888 407 29,318 29,974 656 2,086 3,332 647 277 1,014 737 6, IlOO 3,844 (2,246) 4,696 4,783 87 13,748 12,973 (775) 25 27 2 , 2 (2) 75,545 70,285 (5,260) 44,865 61,303 6,488 14,965 17,338 2,383 59,820 68,641 8,821 11,418 16,760 5,342 434 422 (12) 5,38li 7, "" 2,063 17,237 24,630 7,393 Monitoring net alert1L _ Unlicensed stations detected and identilied _ Direction-finder bearings:I~~~~~I.~~~~~I~~~~ Case bearings _ Search-aud·rescue bearings _ TotaL Cases monitored and developed: Major: Interference _ Noninterference • _ Minor (local): Interference _ Noninterference•••• _ Total_ Discrepancy notices issued: FCC licensees_ • _ U.S. Government stations_ __. _ Foreign stations_ _ _ TotaL_______ ____ _ __ __ I--=-==_I-----;::c:::-I---;;-:=_ FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 163 Oommeroia~radio operator UcenS8S Class of license Radiotelegraph: 1st eI8SII. ._ _ • 2d class4__________ _ . 3d class • _ Radiotelephone: 1st class . _ 2d class~_ 3d ClaslL • __ • _ • Restricted permits~_ TotaL~_ Outstanding Outstanding Increase or July 1, 1964 June 30, 1965 (decrease) .020 6,007 (113) 9,370 9,330 ('OJ ',063 1,948 (116 81,439 84,802 3,363 64,328 67,185 2, Sli7 106,138 119,731 13,593 2,3«,517 2. 422,W4 78,417 2,613,8i5 2.711,837 97,962 Applications prooe88ea by Antenna Survey Branch Pending ReceivedCompl~tedPending Obstruction Services July 1, In ASB byASB Jnne 30, markings .,.. .965 assigned Broadcast: AM_________.~_o._________ • ___ .0 _______ 20 335 335 20 '49 FM_.o~.______________ • __ . _____________ 37 424 435 26 231 TV_. _____________ ••______________ •____ SO ... 1,000 " 334 InternationaL•• ____________~_•••______ 0 • • 0 1 E~perimentaL________________________ , 12 12 , • Total broadcast_________ •___________ .39 1,756 1.783 11' 816 Commoncarrier~________ 4. ____ •_______ 44.4 '49 I,M2 1.746 .. 81' Safety and special radio____________ •• _____ M8 "'880 2.>,224 20< 1,076 Grand totaL4 .444. _______ 0____ 44._ •• Il36 28,178 28,753 361 2,706 Applications reqUiring aeronautical study by Federal Aviation Agency Services Broadcast: AM. • •• FM • _ TV. o •~.__.~_ IntemationaL. 4 4 _ ExperimentaL.~4_0__ ••4 _ Total broadcssL4'4_ ••_••_. _••44 .44_••~• _ Common carrier • _ Safety and speeJal radJo__~.'_4 _ Orand totaL4.00~.• •••_ Pend1ng AddJ- FJnal Pending at FAA tlonal actions at FAA July 1. during during June 30. 1,.. y,,", y,,", 11165 11 "" "" 20 11 205 180 20 30 378 344 64 0 1 • 0 , • , , " 868 '96 11' '" Il36 941 .. H' ',<20 .,367 204 '45 6,209 6,098 361 Research and Laboratory TECHNICAL In fulfilling its mandate to provide for efficient use of the radio spectrum, the Commission has found it effective to follow certain policies in the technical urea, which minimize the amount of inter ference electronic devices of all kinds may cause to users of the spec trum. Thus, technical standards govern the performance of licensed devices such as radio transmitters. Also, because ever-increasing in terference is being caused by miscellaneous unlicensed electrical devices ranging £1'0111 huge industrial induction heaters down to tiny transistorized electronic equipment. in small home appliances, it has attempted to set up applicable radiation limits. The Commission solicits, not always successfully, the cooperation of Inanufacturers and users in observing these limits. It also regulates, and at the same time attempts to encoumge, the growth of radio by means of hundreds of research or dev-elopulent projects in the Experi mental Radio Services. These are myriad and range from exploring the far reaches of space to research on the deep sea bottom. Technical Standards far Licensed Equipment FCC engineers participated in studies of the feasibility of channel splitting (fitting bvo channels into frequency space previously as signed to one) to provide more assignable frequencies in the 450 470 Mc band, and worked with industry engineers exploring ways and means of accommodating more and more stations in the land mobile radio services. Similar cooperative efforts resulted in the adoption of a new, lower power level for TV aural transmitters. Other studies were made of technical standards for radar devices and for the burgeoning CATV microwave relay operations. Not only must the FCC set technical standards for the devices it liceuses but it must also insure that the equipment in use actually meets those standards. One means of accomplishing this is provided by the type acceptance program through which the technical char- 164 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 165 acteristics of 469 different types of transmitters were examined closely by Commission engineers and found acceptable. Regulation of Nonlicensed Radio Devices The plethora of nonlicensed radio frequency devices continues to pose major problems. The numbers and types of such devices grow at explosive mte. Typical are radio controls, wireless microphones, radio and TV receivers, electronic intruder alarms, gadgets and toys and appliances of various descriptions, industrial heaters, medical equipment, and ultrasonic devices used in industry and in the home. Nonlicensed operation of these devices is permitted if certain con ditions are met or certain procedures are followed. In the interest of flexibility, various requirements are incorporated in the FCC rules for various categories of these devices. Depending upon their type, these may include provision for labels to be attached to the device, or certi fication hy the manufacturer that the equipment meets certain radiation limits. Since the Commission has no authority over manufacturers, its usual procedure is to direct a manufacturer's attention to the rule require ments and to ask his cooperation in marketing a product whose opera tion conforms with regulations. If this is not forthcoming, action to curb an individual interfering device can be taken. The enormity of the task of regulating radio-frequency devices can best be appreciated by looking at their sheer numbers: the Door Operator and Remote Controls Manufacturer's Association estimates that some 500,000 residential garage door controls are in use today and that 90,000 to 100,000 are being manufactured annually; statistics compiled by the Bureau of Public Roads indicates that 86,297,133 automotive vehicles were in operation at end of 1964, an increase of 4 percent from a year earlier. Insofar as radiation from auto mobile generators and iguition systems are concerned, the Automobile Manufacturers Association in a program of self-regulation assures the Commission that these radiations are suppressed by shielding and filtering to levels specified in an industry standard to obviate inter ference to radio users, particularly TV viewers and AM and FM listeners. During fiscal 1965, the Commission: Amended its rules and revised FCC Form724, Certificate of Compli ance for Industrial, Scientific, and Medical Equipment, to provide a simpler prototype certification procedure; Proposed to revise the rules for radio door controls to (a) preclude operation on aeronautical radionavigation bands, (b) require greater 789-224--66----12 166 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT greater radiation suppression, and (c) delete the on/off timing require ments on the control transmitter; Reviewed 819 prototype certificates submitted by both foreign and domestic TV receiver manufacturers; Proposed further regulations to govern radio-frequency operated intruder alarms; Again proposed legislation to give the Commission authority to regulate the manufacture and sale of devices capable of causing interference to authorized radio users; and Issued a continuous flow of advice to individuals and industry groups about regulations governing operation of nonlicensed radio equipment. Radio Experimentation Encouragement to scientific investigations, research and develop ment in radio communication and technology in general is provided through the Experimental Radio Services. As the number and com plexity of these experimentation efforts increase, the problems involved in fitting frequency assignments and emission limitation into the exist ing patterns of use become more difficult. The Commission makes every effort to license all who supply a promising program of experimentation. An increasing number of experimenters are studying not ony the surface of the oceans but are probing its depths. Subsurface commu nications and the telemetering of important oceanographic data have become indispensable tools in these studies. In the upper atmosphere, many new "sweep frequency" experiments have been launched. These involve transmissions of short pulses which are scanned rapidly across huge bands of frequencies. The information returned from these transmissions helps applicants choose available frequencies best suited to their needs. Both Governmental and nongovernmental groups are actively pursuing sweep-frequency experiments. Space communication, which was first licensed a few years ago under Experimental Radio Services rules, has developed with great speed (see special chapter). Type Acceptance Type acceptance is a procedure for determining the suitability of transmitting equipment for licensing by the Commission. The objec tives of the type acceptance program are (1) improvement in spectrum utilization by limiting interference capabilities of transmitters, (2) elimination of duplication of effort among personnel in the various FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 167 Commission offices in assessing characteristics of transmitters for licensing purposes, and (3) relieving applicants of the burden of filing transmitter technical data with station license applications. The following table compares the past 2 years of type acceptance activity: Type of equipment Number of applications granted Increase or 1----.---1 (decrease) 1004 1965 TV broadca.sL •. _. _. _ AM and FM broadcast . ._ NonlJroadcast _ Total _ 15 " 470 12 47 410 4£' (3) (8) (60) (71) Technical Standards Studies Efforts were continued to find ways to accommodate the increasing number of stations in the land mobile services. Studies were made to determine the feasibility of channel splitting and narrow band operation to provide more assignable freqnencies in the 450-470 Mc band. Other studies pertaining to the land mobile services are in progress. In several of these, liaison is being maintained with the Advisory Committee for Land Mobile Radio Services. Technical standards for a new public air-ground radiotelephone service were developed and proposed (docket 16073). This new sys tem, using single sideband, would provide at least sixty 2-way chan nels in the spectrum space now occnpied by 6 channels using FM transmission. By use of this new single sideband technique, an ade quate public air-ground radiotelephone service might be provided without excessive spectrum usage. The technical criteria proposed were developed from studies of developments, domestic and foreign, in utilizing single sideband techniques. Technical standards studies are being conducted with a view to improving Commission requirements in such matters as frequency tol erance, bandwidth of emissions, antenna power gain and measurement techniques. This work is being done also in international technical committees to coordinate domestic and international requirements, thereby facilitating international communication and making equip ment more generally useful thronghout the world. RESEARCH General As the radio spectrum becomes more crowded, and as technology becomes more advanced, the problems associated with efficient alloca- 168 FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT tion and assignment of frequencies become more clifficult to solve, and continual study and research are required to develop flmdamental information which may be applied in dealing with these problems. Studies were made to obtain more information about the propagation of radio waves particularly as it pertains to specific allocation and assignment problems. Improl'ed data processing techuiques continued to be studied for solving various technical problems. Radio Propagation and Service Data obtained from the New York City UHF-TV project con· tinued to be studied and additional reports were prepared for the U.S. preparatory committee of the International Radio Consultative Committee (CCIR) on the following phases of that project: "Compar ison of Channel 31 Measurements 'With CerR Propagation Curves," "Relationship of Aural to Visual Reeeived Powers," "A Study of UHF Multicasting," "Relative Effectiveness of Indoor and Rooftop TV Reception" and "Height Gain Measurements for Antennas 3.0 and 9.1 Meters." Plans were completed for a field strength measurement and analysis program to obtain data for a statistical approach to the problem of precipitation and other off-path scatter interference and its effect upon station assignments in satellite and terrestrial microwave radio com· munication systems. The Air Force, Coast Guard, Weather Bureau, FAA, and NASA are cooperating in this endeavor, which is known as the POPSl project. It would cost more than a million dollars to' duplicate this work without such cooperation. The actual measnre ment program is expected to commence in September of 1965 and continue for approximately 1 year. A new set of VHF and UHF field strength curves was developed for proposed adoption in the FM and TV broadcast rules (docket 16004). FM station assignment techniques were studied particularly with respect to co·channel frequency offsets, station spacing configurations, signal to interference ratios, optimum antenna heights, and effective radiated powers. Studies were also made concerning the allocation and assignment of TV frequencies and its effect upon other services. Theoretical investigation of techniques for using information about the topographic characteristics of terrain for predicting UHF and VHF field strengths continued. A comparative analysis of the reliability of airborne TV broadcast transmission on 800 and 2500 Me was made. Enhanced skywave transmissions of AM broadcast frequencies over tropical regions and the relationship between sunspot numbers and FEDERAL COMMUNICATIONS COMMISSION 1965 ANNUAL REPORT 169 this propagation were studied. This work is being coordinated with the Central Radio Propagation Laboratory of the National Bureau of Standards. In the work of the FOC-sponsored Advisory Committee for Land Mobile Radio Services, the Commission pmvided the chairmen for two groups. One group is charged with establishing technical factors; the other is investigating the extent to whieh ma,nmnde noise limits the coverage of land mohile systems. The Commission participated in the .Joint Technical Advisory Com mittee study 'of electromagnetic comp",tihility. This committee is acting as a focal point for the initial study of needed technical pro grams in this field. The Commission is also represented on a number of committees of the Institute of EJectricaland Electmnic Engineers. Its foreign collahoration includes OCIR study group work on satel lite communication, tropospheric and ionospheric propagation, medimn frequency broadcasting anrl television. It also participated in activi ties of theInternational Scientific RadioUnion. Data Processing Techniques Studies continued on the use of data processing techniques in per forming engineering calculations associ",ted with application proc essing. A eomputer program for calculating radio paths (Report R-6501) was developed and used, for example,to study the possible adverse effect of a proposed TV antenna tower on an existing micro wave radio linkthat passed close to the proposed structure. The sharing of frequencies by earth stations and s",tellites with sta tions in the radio relay services and the increased congestion of radio stations in many areas pose increasing problems of the coordination of frequencies. Consequently, the Commission is commencing a study of the feasibility of using a computer and its data storage capwbility for producing tabulations and graphical plots of the terrain elevation between selected points. Research Reparts The following research reports were issued during the year: R-6408, "A Study of the Technical Factors Pertaining to the Assignment of FM CATV Microwave Relays"; R-&109, "The Interference Flutter Rate in Mobile Receivers" ; R--6!1O, "Elevation and Depression Angle Tables" ; R-6411, "Techni