Senator PASTORE. Fine, anyway you would like to do it.

STATEMENT BY COMMISSIONER ROBERT T. BARTLEY

REPRESENTING THE MAJORITY OPINION

Mr. BARTLEY. Thank you, Mr. Chairman.

I am Robert T. Bartley, Commissioner of the Federal Communications Commission. The statement that I am about to read has some history that I think the committee should be aware of. It was prepared sometime ago and was adopted by a 6-to-1 vote of the Commission. In the meantime, the Commission makeup has changed and at the present time this statement reflects the views of only four members, three of whom have concurring statements.

Also I have been asked by the Bureau of the Budget to advise that, because it construes the individual Commission, individual views of the Commission forming the majority of opinion as somewhat of a modification of the Commission's statement, that time has not permitted the Bureau to take a position on this subject.

The Commission appreciates the opportunity to appear here today to express our views on S. 2004. The bill, applicable only to broadcast licensees, would amend section 309 (a) of the Communications Act to prohibit the Commission from considering competing applications upon the expiration of a license term. While we appreciate the purpose of the bill to promote predictability and stability of operations— factors which we agree are important considerations-we do not support the bill because we believe that it is unnecessary and would, in our opinion, have significant disadvantages to the public interest.

It is of course true that the institution of a broadcast service requires a substantial investment, particularly in television, and that, even where the investment is small, it is likely to be relatively large to the person making it. It serves no public purpose to place in unnecessary doubt the broadcaster's ability to have his license renewed. If the license is given subject to arbitrary withdrawal, it will simply not be possible to induce people to enter the field and render what has now become a vital public service. No one will disagree with the proposition that it would be a disservice to the public interest to reward good public service by a broadcaster with an unjustified termination of the authority to continue the service. The broadcast field thus must have stability, from the standpoint of service to the public. Indeed, as a further matter, I note that the Commission could not administratively discharge its functions without that stability.

But this clear public interest in stability is not the only relevant consideration. It has been a cardinal principle of communications law over 40 years that the radio spectrum is a valuable national resource to be used only in the public interest. The public interest to be served under the act is the interest of the listening and viewing public in the larger and more effective use of radio. This concept is the essence of the entire regulatory scheme Congress adopted in the Communications Act of 1934, and in the predecessor Radio Act of 1927.

I will not recite the pertinent provisions at length, but I would like to note that section 301 of the act states that the purpose of the act is to

Maintain the control of the United States over all the channels of interstate and foreign radio transmission; and to provide for the use of such channels, but not the ownership thereof, by persons for limited periods of time, under licenses granted by Federal authority, and no such license shall be construed to create any right, beyond the terms, conditions, and periods of the license.

Section 307 (d) limits the term of a broadcast license to 3 years, section 309 (h) requires the Commission to include in all licenses the specific provision that the license does not vest in the licensee any right to operate the station nor any right to use of the designated frequencies beyond the term of the license, and sections 307, 308, and 309 make the public interest, convenience, and necessity the sole standard for grants of initial licenses, modifications of licenses, and license renewals.

The statute as it now stands thus preserves and protects the public's interest in the use of radio through limited license terms. These limited terms serve a dual purpose. They permit Commission review of the broadcaster's stewardship at regular intervals to determine whether minimal standards have been met, and they also provide an opportunity for new parties to demonstrate in public hearings that they will better serve the public interest. In its second annual report to Congress in 1928-page 170-the Federal Radio Commission stated that its task in choosing among applicants was to determine which would best serve the public, going on to say:

In a measure, perhaps all of them give more or less service. Those who give the least, however, must be sacrificed for those who give the most. The emphasis must be first and foremost on the interest, the convenience, and the necessity of the listening public, and not on the interest, convenience, or necessity of the individual broadcaster or the advertiser.

The Supreme Court in the landmark case of the National Broadcasting Co. v. United States, 319 U.S. 190 (1943), agreed that

Since the very inception of federal regulations (of) radio, comparative considerations as to the services to be rendered have governed the application of the standard of "public interest, convenience, or necessity". (e19 U.S. at 217.)

In this connection, we note that the Communications Act was amended in 1960, so as to require applicants, including those for renewal of license, to give timely notice of the filing of the application in their principal area of service, and that no such applications shall be granted earlier than 30 days following the Commission's issuance of public notice of the acceptance for filing of the application.

The Commission strongly believes that the spur to a lagging broadcaster posed by the threat of competitors at renewal time is an important factor in securing operation in the public interest. The Commission's staff is not large, and there are over 7,000 broadcasting stations. The existing procedures at renewal time provide a powerful supplement to our review capabilities in the form of potential competitors who will provide more than a minimal service to the public if the existing licensee is unwilling or unable to do so. The first question posed by S. 2004, then, is whether there is anything in the record of our administration of the act which indicates that the public interest in stability is so threatened that the great benefits of competition must be forsaken. We do not believe there is.

Mr. Chairman, I know of no case, at least since the earliest days of regulation when policies were first being formed and tested, where an established broadcaster rendering a good public service has been displaced by a newcomer. It simply has not happened. The hearing proc

ess, with its rigorous examination of the facts, permits the established broadcaster a full and fair opportunity to show a record of solid performance; correspondingly, it will expose any overblown promises easily made by some new applicants.

There has been much discussion, I know, of the Commission's recent decision in the Boston channel 5 television case. Since that decision is now on appeal, I cannot appropriately discuss it. However, I can point out what the Commission stated in its opinion denying reconsideration. It stated:

In closing, we think it should be made clear that our decision herein differs in significant respects from the ordinary situation of new applicants contesting with an applicant for renewal of license, whose authority to operate has run one or more regular license periods of 3 years. Thus, although WHDH has operated station WHDH-TV for nearly 12 years, that operation has been conducted for the most part under various temporary authorizations while its right to operate for a regular 3-year period has been under challenge. Not until late September 1962 did WHDH receive a license to operate its television station, and even then its license was issued for a period of 4 months only because of the Commission's concern with the "* * * inroads made by WHDH upon the rules governing fair and orderly adjudication ***" Again, unlike the usual situation when an applicant files for renewal of license, after WHDH filed its renewal application we issued an order directing that new applications for channel 5 would be accepted within a specified 2-month period. Such applications were filed, accepted, and entered into the proceeding herein. Those unique events and procedures, we believe, place WHDH in a substantially different posture from the conventional applicant for renewal of broadcast license.

The Commission's treatment of a true renewal situation is exemplified by the leading decision in Hearst Radio, Inc., 15 F.C.C. 1149 (1951), where the Commission favored the existing licensee. While the Commission's treatment of each of the factors in that case might not be the same today, it is significant that the dissenting opinions as well as the majority agreed that where a choice must be made between an existing licensee and a newcomer, a grant will normally be made to the existing station if its operation has been satisfactory, and that a good record may outweigh preferences to a newcomer on such factors as integration of ownership and management and local residence. The Commission's concern with orderly procedure in the consideraof applications for renewal of broadcast licenses has recently led it to take a significant step to improve the processing of renewals to remove the threat to existing licensees that if action on a renewal application was held up for any reason, the application would remain open to competitors until such time as the Commission might act, perhaps months later. The Commission on May 14, 1969, adopted a new procedural measure requiring competing applications to be on file by the first day of the month preceding the expiration of the license term. This rule became effective June 25, 1969. We believe it to be an important step in assuring the orderly processing of renewal appli

cations.

Senator PASTORE. Was that as a result of the bill we introducedS. 2004?

Mr. BARTLEY. No sir; it is the result of some applications which were given to be filed and we felt when we were holding up the application time that it set the station up, more or less, as a sitting duck and somebody might come in-they would know something was wrong in that a renewal not be granted in time.

So we cut that off to give that cutoff, anyone would have to be prepared long before that time so they wouldn't be using the Commission's holding it up as a come-on signal.

With this background, we urge you not to remove the spur of competition at renewal time. To do so will make it more difficult to obtain a high quality of public service, and no problem has been shown for which such a drastic remedy is required.

For the reasons I have given, the Commission does not favor the enactment of S. 2004. We believe that the basic objectives of the bill can be achieved better by administrative decision which will give due weight to good records of operation without removing the incentive for such operation now contained in the act. Such administrative action would, I believe, provide an appropriate resolution of the two main policy issues raised by S. 2004. No licensee doing a good job would have to fear loss of his license to a competitor; at the same time, the public's interest in good service should be preserved through retention of the opportunity for replacement of licensees doing a minimal public service by those better equipped for the task.

As I mentioned above, the Commission through the years has relied upon the spur of potential competing applicants to induce licensees to achieve more than a minimal level of public service. In that connection, we have not attempted to prescribe particular amounts of percentages of time to be devoted to local or other public affairs, although our broadcast service is based upon the principle that there shall be local outlets in as many communities as possible attuned to local needs and interests. If we lose the incentive to good service that potential competitors can provide, and licensees need do no more than meet the minimum standards sufficient to avoid disqualification and denial of renewal, it would, I believe, be urged that the Congress or the Commission should review these standards and, in line with the Supreme Court's discussion in its decision of June 9, 1969, in Red Lion Broadcasting Company v. United States, set out a further specification of time to be devoted to local affairs and public affairs. Other alternatives might be put forth. My point is that a basic and long-established competitive prop will have been removed from the Communications Act, and Congress and the Commission will be called upon to find a suitable substitute for that prop.

One further aspect of S. 2004 should be noted. The present statute contains the single traditional and well-understood standard of the "public interest, convenience, and necessity" for action upon renewal applications. S. 2004 would not only bar competing applications at renewal time but would direct the Commission to determine the public interest in a renewal of license "upon the record and representations of the licensee." It is not clear what change, if any, this would work. Every grant or denial is "upon the record" whether or not it is a hearing matter and every application constitutes representations.

Senator PASTORE. If I may interrupt you, the reason why that was put in there was to leave a burden of proof on the licensee. There was never any attempt to remove it from the licensee?

Mr. BARTLEY. Well, it wasn't clear to us. Wording might take care of that. To the extent that this language might be interpreted as narrowing the range of the public interest factors to be considered, we believe it would be undesirable. The singling out of the licensee's "representations" for special significance would also work confusion and would be undesirable if intended to exalt promises for the future over past record and other factors. We know of no reason to change the present standard and urge that the words "upon the record and representations of the licensee" in lines 9 and 10 be deleted if S. 2004 should be enacted.

In sum, what is important to all of us is that the legitimate requirements of stability be pursued in a manner reconcilable with the overriding public interest in the use of this precious national resource. We stand ready to cooperate fully with the committee in this most important task.

Senator PASTORE. Well, how many joined in this, Mr. Bartley? You say four joined in it?

Mr. BARTLEY. Yes, sir.

Senator PASTORE. Who are they?

Mr. BARTLEY. Commissioners Cox, Johnson, and Rex Lee.

Senator PASTORE. And Mr. Lee. Well, gentlemen, I tell you very frankly, I don't think any bill has been more maligned than this particular bill. I was refreshed to read an editorial that appeared in my own newspaper back home on Friday, November 21, 1969, which I think very cogently explains and defines the bill.

As a matter of fact, this very newspaper had been somewhat particularly critical of the bill at first reading and whether it took a second look at it-now whether it was the Vice President Agnew case or not, I don't know

Mr. BARTLEY. I am not sure that may not be some of the reason for the concurring statements.

Senator PASTORE. I didn't say that to be funny. I think there have been some developments. The fact still remains that no one has ever suggested S. 2004 would give a license in perpetuity. I am one of those who has always believed in the philosophy that a licensee in any form, any licensee licensed by any government agency has an obligation and a responsibility to live up to the law and be made to live up to the law. He should not be coerced into living up to the law or induced to live up to the law for fear that somebody else will come along and take it away from him.

That to me has not been the philosophy of America. Our philosophy has always been positive and has never been negative.

Now, in recent months I have been very much disturbed-I have no personal interest in this. As I said time and time again, I don't own a nickel of stock in any broadcasting station. I have praised them. I have condemned them. I have criticized them, and I have done it in public almost as much as Commissioner Johnson, but nobody can beat his record. The thing that bothered me is this, and it still bothers me after all, you have 7,000 radio and television stations and television and radio isn't ABC, and CBS and NBC, and Metromedia, I mean there are a lot of little people in this. There are many cases where a man and wife have gotten a