there has been no more dynamic industry from the standpoint of new technologies and change than wire and radio communications. The instant proceeding is an illustration of the rapidity and effect of such changes. Within the period since inception of this proceeding and the time of reopening the record on November 28, 1967 the communication facilities available for use by the press and the rates applicable thereto had changed to such an extent that the record made in 1963 had become completely outdated. The major services relied on by the press in 1963 are now in the process of virtually complete abandonment by the two principal domestic press facilities with the economic consideration of extensive savings in wire service costs being the spur to conversion to the use of the new technologies and wire services now available even though they involve the same payment for wire services as those made by all other users. The press, as shown by the record, is also now in the process of expanding the use of computers with consequent further changes in communications need and it is probable that within the next five-year period the present record will also have become completely outdated." Advancement from use of the hand operated telegraph key and manually operated switchboard to the present use of communication satellites and automated equipment has occurred in less than the span of a single average lifetime at a continuously accelerating rate. In the light of these developments tradition provides no basis for resolution of the matters in issue. And the Commission has specifically answered in the negative the contentions of the press parties here renewed that this tradition has given rise to a goverenment policy favoring rate discounts for services involving press communications needs. A.T.&T. and Western Union Private Line Cases 34 F.C.C. 245. The concern of the Commission in this proceeding is fully expressed in issues A and A (2) and resolution of the proceeding must rest on the evidentiary record made relevant to whether the application of nonpress rates to this industry would impair the widespread dissemination of news, not on asserted tradition or policy. 72. From the evidentiary record developed in this proceeding the only conclusion that can be reached is that application to press users of the charges, regulations, practices and classifications currently ap plicable to non-press users of private line services would not diminish, limit or impair the widespread dissemination of news. The scope of the cost increases which would come from elimination of the press exception has been detailed in the findings of fact. As is also detailed in the findings of fact, the actual overall increases which will result will be substantially less than the figures urged by the press parties. As shown by the updated record more than half of the increase shown by repricing at commercial rates of the telegraph service leased by the press would have been borne by UPI and AP. Upon completion of conversion to the use of voice grade circuits the effect of abandonment of the present special press rates on these two major news 10 See for example In the Matter of ITT World Communications, Inc. et al FCC 68-1011 released October 14, 1968 authorizing the derivation of up to 34 standard speed (50-baud) telegraph channels from voice channels for overseas communications. Also there noted is newly developed equipment asserted to have the capability of deriving up to 108 telegraph channels from a voice channel. services from a cost standpoint would be, to use the term of AP, minimized. Interstate services affected by this proceeding are of only minor concern to the news wire services of Twin Coast. It, however, is also in the midst of assessing the effect multiplexing would have on its total wire costs with these studies indicating a substantial reduction. 73. In weighing the showing of the supplemental news services participating in the proceeding following remand, all are adjuncts of newspaper publishing operations and the publications associated with each utilize the supplemental services wholly or in part in connection with these publications. Any increase in cost of wire service from elimination of present press rates for the assembling and distribution of the news products of these services in every instance represents an insignificant part of the overall operating costs of the associated companies. Accordingly, any reduction in product would be solely the result of management judgment rather than necessity because of increased wire costs. Moreover, those relying on subscribers to offset in whole or in part the costs of these services have made no studies to determine the effect elimination of press rates would have on their subscribers. All would seek to pass any increase on to their subscribers and there is no record evidence that would warrant a conclusion that increases of the magnitude here involved would substantially lessen the use of these services. Assuming that all the wire costs to these services are increased to the figures set forth in the evidence the total effect on the press industry would be minimal. (See paragraph 61, supra.) 74. The direct use of private wire services by individual newspapers is too limited to be of substantial weight. (See paragraph 60, supra.) Effect on the present use of private line press services by McGraw-Hill would also be minimal. Though it asserts discontinuance of press rates would make contemplated extensions of use of private line telegraph service uneconomic, no factual evidence was presented in support of this assertion. Nor does it attempt to relate this assertion of economic justification to an increase of near $17,000,000 in net income after taxes for 1967 over that for 1962. 75. In view of the foregoing findings fact and conclusions and upon consideration of the entire record in this proceeding it is concluded that application to the press of the charges, regulations practices and classifications currently applicable to non-press users of the private line services used by the press would not diminish, limit or impair the widespread dissemination of news in any manner inimicable to the public interest. Consequently there is no basis in this record for concluding that other users of these services should bear the burden of increased rates to support lower rates for the press industry. The application of just and reasonable rates to all users of this service will, therefore, best serve the public interest as continued application of lower rates to the press would be unreasonable within the meaning of Section 201(b) and unduly discriminatory within the meaning of Section 202 (a) of the Communications Act of 1934, as amended. Accordingly, IT IS ORDERED, That, unless an appeal from this Initial Decision is taken to the Commission by a party or the Com mission reviews the Initial Decision on its own motion in accordance with the provisions of Section 1.276 of the Rules, the currently effective exception from the private line telegraph and telephotograph rates accorded to press users in the Commission's Memorandum Opínion and Order, adopted May 27, 1963 (34 F.C.C. 1094) is terminated effective 50 days from the date of public release of this Initial Decision and this proceeding terminated. 25 F.C.C. 2d FEDERAL COMMUNICATIONS COMMISSION, F.C.C. 70-884 BEFORE THE FEDERAL COMMUNICATIONS COMMISSION In the Matter of WASHINGTON, D.C. 20554 AMERICAN TELEPHONE & TELEGRAPH CO. AND THE WESTERN UNION TELEGRAPH Co. Charges and Classifications for Private Docket No. 15094 photograph Services Furnished to the Press ORDER (Adopted August 26, 1970; Released August 26, 1970) BY THE COMMISSION: COMMISSIONER COX NOT PARTICIPATING; COMMISSIONER JOHNSON DISSENTING. 1. In a Decision, FCC 70-252, released April 28, 1970, the Commission ordered the currently effective exception accorded to the press from the private line telegraph and telephotograph rates terminated effective 50 days from the release date of the Decision, or by June 17, 1970. Subsequently, in response to a Joint Petition for Reconsideration of the Decision, the Commission in an Order extended the effective date for the new press rates to September 1, 1970. FCC 70-602, released June 12, 1970. The Commission now has before it a Petition for Modification of that Order, filed on August 13, 1970, by The Copley Press, Inc., Field Enterprises, Inc., and the Los Angeles TimesWashington Post News Service (petitioners). The petition requests that the Commission modify the above Order to further extend the effective date for the new private line telegraph press rates to January 1, 1971. 2. In support of their request, petitioners state that in its Order postponing the effective date of the higher press rates to September 1, 1970, the Commission took notice that American Telephone and Telegraph Company (AT&T) had under consideration certain tariff revisions which would lessen the barriers to joint use of private lines and would mitigate any hardship which might be caused by termination of the special press rates. However, petitioners state, AT&T did not file the anticipated tariff revisions until July 8, 1970 and that as a result the September 1, 1970, date does not provide sufficient time, despite petitioners' diligent and continuing efforts, for petitioners to evaluate and implement workable joint user arrangements. Therefore, as noted, petitioners request that the effective date of the new press 1 Other pleadings before the Commission are: (a) Opposition, filed August 18, 1970, by The Western Union Telegraph Company; (b) a pleading, filed August 18, 1970, setting forth the position of the Common Carrier Bureau; (c) Opposition, filed August 20, 1970,. by the Bell System. rates be extended to January 1, 1971. Although petitioners concede that the additional time will not be sufficient for full implementation of a joint use arrangement, they state that it would allow them to evaluate the present proposals and to investigate other possibilities. Thus, petitioners assert that a grant of their request will enable them to mitigate the impact of the new rates and to avoid substantial and irreparable harm. Finally, in the alternative, petitioners ask that if the requested extension is not granted, that the Commission stay its Decision until the Court of Appeals for the District of Columbia has passed upon a request for a stay pending judicial review of the Commission's Decision.2 3. The Petition for Modification is opposed by the Western Union Telegraph Company. Western Union notes that petitioners have made it clear that they will require additional time beyond the requested extension for implementation of any joint user arrangement which they might adopt. Thus, Western Union contends, the current petition is merely a prelude to further requests for extension. Western Union further argues that the petitioners will not suffer irreparable injury merely because they are required to pay the same reasonable rates prescribed for all other users. Therefore, Western Union asserts that there is no reason to accord petitioners preferential treatment while they consider possible realignments in their service requirements. Finally, with respect to petitioners' alternative request for a stay of the Commission's Decision, Western Union argues that petitioners have not shown the prerequisites for grant of a stay since they have not shown that they will suffer irreparable injury if the stay is not granted or that there is a likelihood of their succeeding in their appeal. 4. The Bell System also opposes the Petition for Modification. Arguing that the petitioners have made no showing that their situation would be substantially different after the requested four months' delay, the Bell System contends that further delay in terminating the preferential press rates is unwarranted. 5. The Common Carrier Bureau neither supports nor opposes the Petition for Modification. The Bureau contends, however, that denial of the requested extension will not impair petitioners' ability to disseminate the news, although a grant thereof might permit petitioners to implement a more efficient transition to regular private line rates. 6. The Petition for Modification will be denied. We cannot permit another delay in the implementation of our April 28, 1970, Decision terminating the special press private line telegraph and telephotograph rates. Therein we held that Western Union and AT&T, which here oppose the petitioners' request for an extension, had realized unreasonably low levels of earnings from private line telegraph and telephotograph services under the rate schedules effective prior to the Commission's Decision in the 1963 Private Line Case, 34 FCC 228, 1098. These rate schedules, while eliminated for non-press users, are the ones currently in effect for the press. Hence, in the absence of a 2 Attached to petitioners' pleading are three affidavits submitted by officers of the petitioners. The affidavits set out the efforts which petitioners have made to develop a workable joint use arrangement and also renew petitioners' argument that elimination of press rates will cause petitioners irreparable harm. |