3. On February 9, 1968, the Commission released its report and order "In the Matter of Amendment of Section 73.636(a) of the Commission's Rules Relating to Multiple Ownership of Television Broadcasting Stations", FCC 68-135, 12 RR 2d 1501, in which it stated in part: In the light of the special problem concerning the top 50 markets set forth in the notice of proposed rulemaking "we will expect a compelling public interest showing by those seeking to acquire more than three stations (or more than two VHF stations) in those markets. The compelling showing should be directed to the critical statutory requirement of demonstrating with full specifics, how the public interest would be served by a grant of the application—that is, the benefits in detail that are relied upon to overcome the detriment with respect to the policy of diversifying the sources of mass media communications to the public.

Since, as shown, Metromedia already has four VHF television stations in the top 50 markets, and Minneapolis, to which WTCN-TV is licensed, is the 16th ARB ranked market, the above statement is applicable to the subject application. Applicant's showing in this case indicates that the criterion of overriding public interest has been satisfied.

NO UNDUE CONCENTRATION OF CONTROL

4. At the outset, Metromedia makes it clear that a grant of the application will not result in any undue concentration of control of mass media in the Minneapolis area. The application contains a breakdown of all the print and broadcast media located within or penetrating the WTCN-TV, Grade B contour. This breakdown shows that there are 6 television stations, 28 radio stations and 24 CATV systems located within the Grade B coverage area. As for print media, there are sixteen daily newspapers, six Sunday papers, one hundred and sixty-eight weeklies and fourteen shoppers. More specifically, the three other commercial VHF-TV stations licensed to and operating in Minneapolis-St. Paul are affiliated with the national networks. Of these three, two other local media interests, Channel 4 (WCCO-TV), operated by Midwest Radio-Television, Inc., also operates WCCO-AM&FM and has ownership interests in local daily newspapers. Channel 5 (KSTP-TV) operated by Hubbard Broadcasting, Inc. also operates KSTP-AM&FM. These two licensees are also owners of other stations around the country. The

third VHF-TV is operated by a subsidiary of Twentieth Century Fox Film Corporation. Metromedia would be an independent operator and has no other broadcast stations serving the Minneapolis-St. Paul market. Metromedia also supplies data to indicate that a grant of the application would not result in any undue concentration of control of mass media from a national standpoint. This data served by the other Metromedia stations, indicating that sets out the competitive broadcast media in markets competition is often from other group owners and licensees with print media interests in the particular markets they serve. Since Metromedia only operates in major metropolitan areas, it is in competition with a plethora of other broadcast and print services.

INTENTION TO OFFER IMPROVED SERVICES

5. Metromedia's "compelling public interest showing" is based primarily on its intention to offer an improved program service to the Minneapolis area. The most significant new program to be instituted will be a daily local program similar to WTTG's (Washington, D.C.Channel 5) "Panorama." This is an hour and a half live program devoted to news, interviews and discussions relating to matters of local and regional concern. Also to be established is a "Consumer Help Center". The center will most likely be staffed by students of the local law school who will take calls from members of the public who are having problems with government red tape or in the private sector. The center serves to educate the public in consumer matters. Other new programs which cater to the public interest are:

1. "Achievements"-a series of spot announcements which recite the contributions of both Blacks and Indians to American culture.

2. "Focus"-members of various community organizations are invited to appear and make an informative statement about the function of their organization.

3. "Operation Grandparents"-During movie programs teen-agers are asked to give whatever number of hours they can each week to help a senior citizen in their local community. The station coordinates the contacts between the teen-ager and the senior citizen.

4. "Operation Adoption"-Once a week for fifteen minutes social workers will be interviewed on the "Panorama" program about children they are holding for adoption in an effort to find homes for them.

IMPROVED NEWS REPORTING

Metromedia also plans to improve news reporting to the area by increasing the staff and purchasing more news related equipment and services. Further, Metromedia notes that WTCN will have available the services of the

specialists they have in various areas of news analysis and direct information from the other stations they operate. Metromedia points out that it is a successful operator of independent television stations in large market and offers its viewers a real choice in programming.

6. In 1968, the Commission waived its "Top-50" policy and permitted Metromedia to acquire a fifth television station in the top fifty markets a losing UHF-TV (KSAN-TV) in San Francisco. Metromedia, Inc. 12 RR2d 561 (1968). That decision was based on the following considerations:

1. Station was a losing UHF operation and assignor lacked funds to make needed improvements;

2. Efforts were made to sell to a buyer with interests consistent with the top fifty policy;

3. Because of the nature of the competition in the San Francisco Television market (Multiple owners affiliated with the national networks), and the independent stature of the Metromedia, a grant would be consistent with Commission policy to promote diversification of broadcast media; and

4. Proposed programming and technical improvements would render a better service to the public.

the hearing requirements of the Commission's Three Year Rule will be waived.

10. Accordingly, based upon our determination that the transferee is fully qualified and that the public interest, convenience and necessity would be served thereby, IT IS ORDERED, that the above captioned application IS GRANTED.

FEDERAL COMMUNICATIONS COMMISSION, BEN F. WAPLE, Secretary.

WTCN-TV PROFITABLE

7. Here WTCN-TV is a profitable VHF rather than a losing UHF station. However, in its 1968 grant of the KSAN-TV, San Francisco assignment, the Commission did allow Metromedia to become a holder of five top-fifty stations. Admittedly, the station it now seeks to acquire is of a different nature than the one it recently gave up. Nevertheless, the market it is here seeking to enter is considerably smaller than San Francisco-MinneapolisSt. Paul is ranked 16th ARB with an SMSA population of 1,813,647, whereas San Francisco is the 5th ranked ARB market with an SMSA population of 3,109,519). Thus, the change in Metromedia's past status from a holder of four VHF's and a UHF in the "Top-Fifty markets" to a holder of five VHF's in such markets is somewhat offset by the fact that Minneapolis-St. Paul is a much smaller market. Accordingly, this grant will not substantially increase Metromedia's potential share of the national television audience beyond what it was with KSAN-TV as its fifth Top-Fifty station. On the question of the impact of this acquisition on the Minneapolis-St. Paul market, we are of the view that Metromedia's stature as a highly successful operator of quality independent television stations in competition with network affiliates, will serve to promote diversification of media in Minneapolis-St. Paul and render, as discussed above, an improved programming service to the public.

8. In view of the foregoing we conclude that Metromedia has made a satisfactory compelling affirmative showing that the public interest would be served by its acquisition of WTCN-TV.

APPLICATION GOVERNED BY THREE-YEAR RULE

9. In addition to the above matters, the application is governed by the Commission's Three Year Rule (Section 1.597 of the Rules). On February 12, 1969, WTCN-TV received a construction permit for a major change in technical facilities. This construction permit authorized principally a change in antenna location and antenna height. Since the instant application was filed on September 28, 1971, less than three years after issuance of the construction permit, the three year rule applies. Applicant states that program test authority for the permit was expected to be granted prior to the filing of the present transfer application. However, on September 28, 1971, the new tower for the antenna collapsed during the final stages of construction. This event has made it impossible for program test authority to be issued in time to remove the permit from the technical requirements of the threeyear rule. There is no evidence of trafficking in broadcast licenses or construction permits and, in view of the above,

METROMEDIA--WTCN-TV

[In re Application of Metromedia, Inc.]

Today the Commission rushes through the approval of a significant station acquisition by one of the largest television group owners in the nation, in order to satisfy complaints by private parties that feel the Commission has waited too long to act on the application. In so doing, the majority completes the emasculation of the so-called "top-50 policy," and confesses its inability to accumulate the relevant data and enforce its own ownership rules for

financial institutions.

The evidence of the rush can be seen in the fact that the staff has had to hurry its presentation to the Commission and also that important information on the holdings by a certain institution of Metromedia's stock was filed only on Monday, and corrected on Tuesday.

Metromedia, Inc., the owner of four VHF television stations in the top 25 markets and a host of other media properties here acquires its fifth VHF television station, located in the 16th market. It is also the applicant to acquire a UHF in the 15th largest market. Thus under Commission policy now nominally in force, Metromedia must make a compelling affirmative showing as to why this additional aggregation of media power will be in the public interest. According to 1969-70 data, Metromedia will, with this acquisition and the other application pending, increase its net weekly circulation by almost 10%, and increase the potential homes it can reach by 12%. It will be able to reach more than 27% of the television homes in the nation.

WEAK GROUNDS

Although the majority has always been able in the past to find the "compelling showing" that the public interest would be served in a "top-50" market situation, never have the grounds for accepting such a showing been so weak. Normally there have been situations where there were UHF stations losing money and efforts had been made to find other buyers unsuccessfully, or there were significant benefits of local or regional deconcentration of a present ownership structure. In addition, there were often important commitments to minority groups in terms of expanded programming, etc. And in the most recent case, the Time-Life-McGraw-Hill applications, community groups by agreement were able to enforce a more vigorous view of the "top-50" policy than the majority viewed necessary. Here there are no community groups spurring the Commission and the parties, and there is no enforcement.

The "compelling affirmative showing" made by Metromedia is mainly a proposal to use programming in Minneapolis which it has found successful in other communities.

There is no benefit of deconcentration-one multiple owner sells to another, and the first promises to use the proceeds to get another, bigger station. This is a very profitable station-not a UHF on the brink of bankruptcy. And part of the "compelling affirmative showing" is a promise by Metromedia to program less hours, less other nonentertainment programming, and less news than the present licensee actually presented in its last license renewal composite week-Metromedia does propose 15 minutes more news per week than the present licensee proposed at last renewal. This is the sum of the majority's compelling showing.

TWO HOLDERS VIOLATING OWNERSHIP RULES

A second major problem with the application is that at least two of the major holders of Metromedia stock are in patent violation of the Commission's multiple ownership rules, as the majority recognizes by sending letters to the owners ordering them to divest. The problem is that the Commission's ownership reports, for a variety of reasons, are not providing the relevant information, on institutional holdings of broadcast stock. The Commission is often reduced to asking transferee applicants to ascertain from the institutional holders of their stock whether the institution is in violation of Commission rules, as a condition to

Commission approval of the application in question. This inquiry is not always made.

The problem is illustrated by the holdings of the two institutions ordered to divest in this case. Keystone Funds has 5.45% of Metromedia, 3.6% of ABC, 6.38% of Downe Communications and 8.7% of LIN Broadcasting. College Retirement Equities Fund, technically an individual owner subject to the one percent limitation but now treated as a mutual fund by the Commission, has 4.65% of Metromedia, 3.5% of ABC, 3.28% of Cox Broadcasting, 3.2% of Fuqua Industries, 2.04% of McGraw-Hill, 3.09% of Rollins and 1.03% of Travelers Insurance. For both these holders, recent Commission action on other transfer applications for other companies (Downe Communications and McGraw-Hill) failed to reveal the rule violations. And these rule violations take place two years after the time the Commission gave for divestiture in the rulemaking that allowed mutual funds to hold as much as 3% of a broadcast licensee's stock. Somewhere in the foggy past there was an effort underway to revise the Commission's ownership reporting form. Perhaps that effort needs to be

revived.

I would set this application for hearing to determine whether it complies with the Commission's "top-50" policy, and whether the public interest generally would be served by granting it.

THE LIBRARY OF CONGRESS,
CONGRESSIONAL RESEARCH SERVICE,

Washington, D.C., September 10, 1973. To: Subcommittee on Budgeting, Management and Expenditure, Senate Committee on Government Operations. Attention: Vic Reinemer, Staff Director. From: Julius Allen, Economics Division. Subject: Chase Manhattan directors of companies in which its trust department has stockholdings, as reported to Senator Metcalf or to the Federal Communications Commission.

The following is a list of those companies in which Chase Manhattan Bank's trust department, in one or more nominee accounts, holds stock and in which there is a joint directorship. Stock data are those based on responses to Senator Metcalf's letter of May 1972 and on information reported to you by the Federal Communications Commission. Information on directors was obtained from Poor's Register of Corporations, Directors, and Executives (1973 edition) and from the Directory of Directors in the City of New York (1973 edition).

AMERICAN TELEPHONE AND TELEGRAPH COMPANY

Chase Manhattan Bank held 1.1 percent of AT&T common stock in three nominee accounts. Robert D. Lilley is Executive Vice President and Director of AT&T and a director of Chase Manhattan Bank.

ATLANTIC RICHFIELD COMPANY

Chase Manhattan held 4.5 percent of Atlantic Richfield stock in four nominee accounts. Robert O. Anderson is Chairman and Chief Executive Officer of Atlantic Richfield and a director of Chase Manhattan Bank.

CHRYSLER CORPORATION

Chase Manhattan held 4.0 percent of Chrysler common stock in three nominee accounts. William R. Hewlett, president and chief executive officer of Hewlett-Packard Company is a director both of Chase Manhattan Bank and of Chrysler Corporation. J. Richardson Dilworth, investment banker with Rockefeller Family and Associates, is a director both of Chase Manhattan Bank and of Chrysler Corporation.

COLUMBIA BROADCASTING SYSTEM

Chase Manhattan held 14.1 percent of Columbia Broadcasting System common stock. Robert O. Anderson, chairman and chief executive officer of Atlantic Richfield,

is also a director both of Chase Manhattan Bank and of Columbia Broadcasting System.

GENERAL ELECTRIC COMPANY

Chase Manhattan held 3.6 percent of General Electric common stock in two nominee accounts. Ralph Lazarus, chairman of Federated Department Stores, is a director both of Chase Manhattan Bank and of General Electric Company.

R. H. MACY AND COMPANY

Chase Manhattan held 3.4 percent of the common stock of R. H. Macy and Company, some as trustee for the Retirement System for Employees of R. H. Macy and Company. Robert D. Lilley, executive vice president and director of the American Telephone and Telegraph Company, is a director both of Chase Manhattan Bank and of R. H. Macy and Company. J. Richardson Dilworth, investment banker with Rockefeller Family and Associates, is also a director both of Chase Manhattan Bank and of R. H. Macy and Company.

THE LIBRARY OF CONGRESS, CONGRESSIONAL RESEARCH SERVICE, Washington, D.C., September 10, 1973. To: Subcommittee on Budgeting, Management and Expenditure, Senate Committee on Government Operations. Attention: Vic Reinemer.

From: Julius Allen, Economics Division.

Subject: Morgan Guaranty Trust Company directors of companies in which it has stockholdings, as reported to Senator Metcalf or in July 1973 issue of Fortune. The following is a list of those companies in which Morgan Guaranty Trust Company has stock holdings as reported to Senator Metcalf in response to his inquiry of May 1972 or as reported in the July 1973 issue of Fortune on p. 86. Respective sources as indicated. Information on directors were obtained from Poor's Register of Corporations, Directors, and Executives (1973 edition), the Directory of Directors in the City of New York (1973 edition), and Who's Who in Finance and Industry (1972-1973 edition).

AMERICAN AIRLINES

Morgan Guaranty held 4.3 percent of American Airlines stock in four nominee accounts. (Response to Metcalf). Carter L. Burgess is a director both of Morgun Guaranty Trust Company and of American Airlines.