Answer. I agree with you completely that local participation, greater public access, and enhanced employment and training opportunities in the media contribute to the quality of our communications system and to our strength as a society generally. Low-cost UHF TV broadcast facilities are one way in which these benefits can be obtained. It may be that expansion in use of the UHF spectrum by encouraging the development and use of such facilities would therefore be desirable.

I intend to explore with the FCC the possibility of a study into these matters and to determine whether such specially designed low-cost station facilities, or translators could be produced.

COPYRIGHT LEGISLATION

Dr. Whitehead, last year you and Chairman Dean Burch worked together in conjunction with interested parties to arrive at an agreement that made it possible for the FCC to lift the freeze on cable. An essential provision of the concensus agreement was that the parties to the agreement would support copyright legislation in the Congress and in the event they could not agree on a fee structure, the legislation would provide for arbitration. In view of the fact that the parties have not yet agreed to support a copyright bill, do you expect to make any recommendations to the FCC that the regulations presently in effect be changed?

Answer. I have not fully determined a course of action, as it is not clear that copyright legislation supported by all concerned parties will not be forthcoming. I do feel, however, that such legislation is an essential element of the FCC's distant signal regulation, since the compromise agreed upon by cable operators, broadcasters, and the program suppliers, was predicted on the expectancy of copyright legislation requiring cable to pay its fair share to program production

sources.

Nevertheless, if there is no agreement among the parties on copyright legislation, the essential copyright element of the FCC's cable rules will be missing. This would certainly require a reassessment of the rules, and perhaps they will have to be changed.

ECONOMIC CONCENTRATION

Dr. Whitehead, you have adopted as an overall communications policy encouragement of competition as a means of most effectively and efficiently meeting the needs of our society. In an effort to implement this process you have pointed to the limitations imposed on our national broadcasting system by our present dependence on the three TV networks. Your emphasis on diversity in several of your speeches is interesting and thought provoking. But what evidence do you have that the concentration of economic power in the networks is contrary to the viewers' interest? In view of the high cost of producing quality programs, what evidence do you have that there is any alternative to such concentration which makes possible the large investments necessary or, in other words, aren't net. works the only entities that can afford the high cost of network programs?

In your speech to the Arts/Media Conference of the National Council on the Arts and the National Endowment of the Arts you talked of the "demand pull" of the viewer as an effective way to obtain more diversity on TV. (1) Don't we already have such a system through the reliance of the broadcasters on ratings which determine, for the most part, whether a particular show remains on the air? (2) Aren't you really getting back to the concept of specialized programming, not that programming directed at a mass audience as done by the networks? While you emphasize the need for program diversity through specialized programming, I note in Advertising Age, a new publication entitled "Pay TV" and in Broadcasting Magazine that the prospective operators of pay cable systems envision for the most part concentrating on sports and feature films. As a policy matter how do we guarantee that (1) pay cable competes fairly with over the air broadcasting in view of the regulatory restrictions presently placed on broadcasters and I am thinking particularly of the public affairs and news requirements which are expensive and which are often not commercially viable; (2) how do we guarantee that pay cable and cable television achieve their potential and don't rely solely on sports and feature films; (3) if we do allow pay cable to carry sports that have been carried by commercial television, aren't we taking away the broadcaster's economic base? And if the broadcasters go out of business, how do we insure that the low income and rural residents don't lose their television service?

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Answer. There has been a long standing and valid assumption that excessive economic concentration in industries controlling the means of communications is contrary to the public interest. For example, as early as 1941, the FCC stated that:

"[Congress] rejected government ownership of broadcasting stations, believing that the power inherent in the control over broadcasting was too great and too dangerous to the maintenance of free institutions to permit its exercise by one body even though elected by or responsible to the whole people. But in avoiding the concentration of power over radio broadcasting in the hands of government, we must not fall into an even more dangerous pitfall: the concentration of that power in the hands of self-perpetuating management groups." (FCC Report on Chain Broadcasting 72 (1941)).

This has been a consistent theme in government regulation of the broadcast media. The FCC has long been concerned with ways to reduce the television networks' control of access to the nationwide audience and control of that audience's access to diverse programming. Moreover, these same concerns underlie the Department of Justice's recent antitrust suit regarding the entertainment programming of the three television networks.

The burden of proof is usually on the broadcast industries to establish that their concentration of economic power is in the public interest.

It would be difficult, if not impossible, for the government to demonstrate conclusively that a less economically concentrated television network industry would be able to support high quality, diverse television programming, because one effect of network concentration is to preclude the development of additional competitive networks. Networks are, indeed, the only entities that can afford the high cost of network programs, because the networks exercise their economic power to vie for audience rating points by driving up the cost of primetime programming.

With respect to my speech to the Arts/Media Conference, I referred to the concept of "demand pull" as an effective way to obtain more program diversity in television. I do not believe that we already have a television system based upon this concept merely because broadcasters rely upon audience ratings to determine the success, or lack of success, of a particular program. In television, the audience is the product being sold to advertisers. In essence, the ratings do not indicate the programs that people want to watch, but simply show what programs people will watch. In this sense, the audience's desires and needs for programming are not important to the advertisers.

To some extent, the "demand pull" concept does involve specialized programming and not the type of mass appeal programming that the networks presently offer.

You also asked for my view regarding the pay television aspects of cable television. Most of your concerns go to the question of whether cable will compete fairly with over-the-air broadcasting. in view of the affirmative programming requirements placed upon television broadcasters and the danger that cable may “siphon” popular programs from over-the-air broadcasting.

With respect to the first question, there is no reason in law or policy to encumber pay cable operations with affirmative programming requirements, such as news and public affairs programs. There are reasons, having to do with spectrum scarcity and economic concentration, for requiring that federally-licensed television broadcasters make special efforts to serve community needs and interests in informational programming, even though such programming may not be commercially viable. There are no similar justifications for imposing the same requirements upon cable television systems, especially if the policy and regulatory requirements for cable assures that there will not be monopolistic control of the multiplicity of cable channels. Indeed, we should move in the direction of lessening the specific affirmative programming requirements in television broadcasting, rather than transposing such requirements to cable operations, when the effect would be achievement of a parity of inappropriate regulation.

With respect to the question of pay cable attempting to siphon popular programs from broadcast television. I believe that cable can co-exist with advertisersupported television without significantly reducing the level of "free" programming now available to the viewer. Moreover, cable can expand opportunities for advertisers seeking more special interest audiences to underwrite "free" programs on cable. While there may be some limited siphoning of programs, in the long run. I do not think it will be destructive of broadcast television's viability. In the short run, however, it would not be in the public interest if the limited

amount of siphoning that did occur deprived viewers of programs before they had access to them on cable systems. Therefore, during the early years of cable development, the FCC should have authority to adopt restrictions regarding the type of programming that can be offered for a fee on cable systems. The issues presented by "pay cable" are sufficiently complex that the Congress may wish to state its own views on this matter, for example, in dealing with the substantial public interest questions presented by "pay cable" presentations of sports events. This would give the FCC additional guidance in applying such anti-siphoning restrictions during the early years of cable development.

I believe that cable will not destroy the economic base of television broadcasting, but if this were to happen, special measures may be necessary to preserve a basic level of programming and other communications services for low income people and rural residents. It is too early, however, to recommend in detail the precise nature of such special provisions.

Senator PASTORE. Senator Hartke?

Senator HARTKE. I think the act which Senator Pastore has been so active in, makes it very clear what the aims of public broadcasting are. In our report on the Public Broadcasting Act of 1967, at page 6 of the report we state that although the aims of noncommercial broadcasting shall be directed toward cultural and information programs, it should not be so highly specialized, that it caters only to the most esoteric tastes, particularly in the area of public affairs. Noncommercial broadcasting, the report states, is uniquely fitted for indepth coverage and an analysis that would lead to a better informed public; and I think Senator Pastore put his finger on it.

You have a political sensitive tool here regarding public broadcasting, and I think you are into an operation which I would like to express to you.

I know you are going to deny from the beginning the observation I am going to make. But it seems to me that what has happened here is that you have an inconsistency in the administration's policy concerning three areas of broadcasting. One of them is commercial broadcasting; the second is public broadcasting; and the third is cable television.

It appears also to me that the administration is probably trying to exert pressure against the major network news programs and their so-called liberal bias by bringing pressure not on the newsmen so much directly, but on the newsmen indirectly by asking the major network executives to make major changes in personnel who are now presently providing that news.

In other words, some of the people who are now giving the news might look forward to getting the ax. Not from the administration, but from some of the network people who will be yielding to that pressure because, as I read your speech in Indianapolis-and I want to thank you for coming to the greatest State in the Union to give that speech as I read that speech, I find in it the overtones of a direct benefit to the networks contrary to what has generally been interpreted.

That is, it provides for the five major stations in the top markets an opportunity for a great extension if they only will cooperate. It appears to me that this is one of the best smokescreens that I have ever seen in the political world and you have delivered it there to cover up this obvious intention of the administration to really get what you want with a seeming approach in another direction.

Now, was it a smokescreen?

Dr. WHITEHEAD. Senator, I think it was more nearly a fire than a smokescreen. If we were attempting to act behind the scenes with ulterior motives, I can only say that, in my judgment, we went about it in a very dumb way.

To the contrary, we are trying to encourage debate on these issues and we were trying to point out to the public and to the broadcasting industry that it is the licensee and the network manager who bears all the responsibility. We were simply saying to them, exercise it however you deem best. To the extent that you are happy with what your news department and you feel that it is working perfectly, then you should leave it alone. To the extent that a station manager believes that the network news that he carries on his station is perfectly balanced, covers an adequate range of issues, covers an ample, wide variety of points of view on those issues, then he has no obligation to go any further.

But where he thinks differently, he should exercise his responsibility. We were not calling for a reduction of criticism of the Nixon administration, or for an airing of only our point of view. Much to the contrary, we are seeking a wider range of view than apparently we can get from three companies in New York City.

Senator HARTKE. In this news field, you have, of course, the Associated Press and UPI, too, that is out there. Have you called for the same type of action on their part?

Dr. WHITEHEAD. No, sir. I have not, because my concern is with how we regulate broadcasting and what processes and policies we adopt for that purpose.

Senator HARTKE. You mean UPI and AP do not have these elitist gossipers, is that correct?

Dr. WHITEHEAD. I did not say that. I am saying they are not directly licensed by the Government; nor are the networks either, as Senator Baker pointed out.

Senator HARTKE. I realize that. You mentioned words like the "rip and read" ethic of journalism and you talk of wire service copy. Yours is an engineering background, is that right?

Dr. WHITEHEAD. Yes.

Senator HARTKE. Have you ever worked in a newsroom at a newspaper, or radio room, or newsroom? Do you understand what really happens there?

Dr. WHITEHEAD. I think I have some feel for it, although I have never worked there.

Senator HARTKE. Have you ever worked in an area of how this all comes together? Do you really believe a person in the small community should go back through and analyze every news broadcast to see whether or not it has elitist gossip-and what is that other word? Senator PASTORE. Ideological plugola.

Senator HARTKE. Ideological plugola?

Dr. WHITEHEAD. As a practical matter, it will be very difficult for the broadcaster in the small market to be

Senator HARTKE. But then it is only a question of degree, is it not? Dr. WHITEHEAD. Yes, and it is a question of what resources he has to obtain a wider range of views. But, most broadcasters have access. to newspapers; they have access to the AP and UPI wires; they can subscribe to other newspaper syndication services, they have the mate

rial that their network sends them down the wire, the daily feed, not intended for the network news show itself. In short, they have ample sources of information.

All I was saying was that when they carry the network news show, or when they carry a network entertainment series, they should be aware generally of what is in there. If, in their judgment, there is not a wide enough range of issues discussed that is important to their community, if there are points of view on those issues that have not received adequate coverage, then they should take some action, either through their own resources to add to the coverage, or in their discussions with their network to implore the network to provide a wider range of views.

We think it is very important that we recognize the purposes of the first amendment, and make sure the American people have available an ample and wide variety of points of view to make up their own mind.

We should resist the temptation, whether through the Government, or through private power, to constrain various points of view.

Senator HARTKE. I have listened to your elitist rhetoric now, but let me come back to your speech. I tried to find the substance of it, and what you are saying and you say something about "this brings me to an important first step."

Now, an important first step is just that-an important first step. You would agree with that, would you not?

Dr. WHITEHEAD. Yes, sir.

Senator HARTKE. It is not nonimportant is it; and it is not a second step?

Dr. WHITEHEAD. That is right; it is not a second step.

Senator HARTKE. Now, you say, also, that, "It has teeth," is that .correct?

Do you use those words? I can find it for you.

Dr. WHITEHEAD. I did use those words, yes.

Senator HARTKE. All right. It has teeth. You see, why I look at this as a smokescreen is the second element of the important first step reads:

Second, the broadcaster must show that he has afforded reasonable realistic and practical opportunities for the presentation and discussion of conflicting views on controversial issues.

That is really a first step, is it not, that is really an important first step?

Dr. WHITEHEAD. I think that is an important step.

Senator HARTKE. I did not say, "important step," I said, "first step." Dr. WHITEHEAD. I was referring to the legislation as a first step in the process of improving our broadcasting policy.

Senator HARTKE. That is right. I am reading from page 6. All I can do is read what you said-I was not in Indianapolis at the time:

*** lead to an important first step the Administration is taking to increase freedom and responsibility in broadcasting.

Now, it has two items, first, "The way we have done this is to establish two criteria." To establish, right? First step is establish. Now, I am taking you down to a level which is not in your elitist category, and you might have difficulty following this common approach, but having