Mr. STANTON. That is correct. We now own 7 stations, and in one of those markets where we own a station I believe there are 23 stations in competition. If you take the other 8 markets in the aggregate, I believe the number is around 71 competitors against our 6 in the other markets. I think that is anything but monopoly so far as those areas are concerned.

Senator MAGNUSON. I think right now that radio is not in anywhere near that condition, but when we pass bills here, they are going to be in effect and we determine policy for many years ahead. I can see easily how radio could get into that condition just like the newspapers. Thirty, forty, fifty years ago newspapers were competitive, but you can take on two hands right now and find the newspapers in this country controlled by 10 people or 10 organizations which are serving, probably, half of the population in circulation. That was well pointed out by a recent book written by Mr. Ernst. I think it would be very unhealthy to allow radio to drift into that condition.

Mr. STANTON. You have no such condition prevailing in radio. Senator MAGNUSON. Right now you have not, but I can see that situation developing in a community where there are three or four stations and one of them faces financial difficulty and the other two merge, and they buy the third one, and there is monopoly.

In many cases, they own the newspaper, too. I think there has to be some restrictive legislation.

Mr. STANTON. I do not know.

Senator MAGNUSON. Nation-wide, I do not know. That is a technical problem, too, for you people in the networks. You have to have these, what you call key stations; is that correct?

Mr. STANTON. Yes; that is correct.

Senator MAGNUSON. You have to have them, but we are legislating against the possibility of things that we think might happen.

Mr. STANTON. I appreciate that. I am not a lawyer, of course, and I was not aware of that fact that the Department of Justice was helpless to prosecute in the case of monopoly in the field of the press. In the AP case, the Department of Justice and the antitrust provisions came into play.

Senator MAGNUSON. They do not have the legal authority to take care of this situation. They have not been adequate insofar as certain geographical areas are concerned, where newspapers, or where one organization or one person completely owns all of the newspapers. The American weeklies have no chance; the country papers are gone.

I do not want to see the small radio stations swallowed up either.

If
you have a lot of money, and you offer a man a decent price, you
can buy. Everything has a market if you pay a good enough price
for it, and there have been such prices. If the FCC had not put some
restrictions on this, we were drifting into that about 5 years ago. We
were getting into a position where one man would own two or three
stations in an area. We were getting into the position where the news-
papers would own all of the stations.

I think the monopoly rule has been a wise provision. I do not disagree with you that maybe the language limiting ownership should be different, or our method of approach different, but I hope that both the networks and radio itself take the position that there should be some restriction on a man owning two stations in the same town or the same geographical area, or owning a big chain of stations whereby

a monopoly might be created. You will end up in more radio regulation than you might be in right now.

Mr. STANTON. I want to make it clear that I am not asking for two or more stations to be owned by a single person serving the same community.

Senator MAGNUSON. I understand, but I want it clear that it would be very bad to adopt that policy.

Mr. STANTON. I would like to come back to the remark you just made about the inadequacies of the antitrust laws for getting at this problem, and ask if it would not be possible to consider the antitrust situation rather than to consider this as a specific industry and single it out for this.

Senator MAGNUSON. I would much rather put it in the Communications Act than attempt to cover it by antitrust laws.

Mr. STANTON. If I may, I will develop the rest of this point. I am perfectly happy to have had your question. In order to get a fuller perspective, it is appropriate to compare broadcasting with some of the other American industries. Immediately it becomes apparent that broadcasting is not "big business." For example, the entire broadcasting industry's volume in 1946 was substantially less than that of some single companies in other fields, a few of which are shown on the following chart.

CHART 1.-Volume of sales-Entire broadcasting industry and individual com

panies in other fields

Mr. STANTON. Just as the broadcasting industry is not big business compared with other industries, the individual broadcasting com

panies are small in relation to the industry as a whole. The stations owned by CBS are WCBS, New York; WEEI, Boston; WBBM, Chicago; KNX, Los Angeles; WCCO, Minneapolis; KMOX, St. Louis; and WTOP, Washington. These stations constituted 0.64 percent of the total number of stations in the industry as of December 31, 1946, and accounted for 7.66 percent of the aggregate nighttime wattage. The relative position of CBS-owned stations, expressed both in terms of number of stations and in aggregate station nighttime wattage is shown in the following chart, chart 2.

CHART 2.-CBS-owned stations compared with all United States standard broadcast stations-number and wattage

Mr. STANTON. It may be noted here that the number of newspapers owned by the largest chain is nearly three times the number of radio stations owned by any network, both in number of units and in proportion to the entire units in the industry. Other measures of the relative position of the CBS-owned stations are a comparison of the rates which they charge and the revenues which they derive, compared with the rates and revenues of the broadcasting industry as a whole. In 1946 the nighttime hourly rate for the Columbia-owned stations represented 3.62 percent of the aggregate nighttime hourly rate of the industry, and CBS-owned stations accounted for 4.90 percent of the aggregate time sales of all stations for the same year. The CBS position in respect to rates and revenues is shown in the following chart, chart 3.

It is interesting to compare the relative position of the Columbia Broadcasting System in the broadcasting industry with that of single companies in other industries. While the CBS share of station revenue, as shown on the foregoing chart, is only 4.90 percent, the addition of network revenue, less payments to affiliated stations, results in a CBS share of total broadcasting revenue of only 10.7 percent. According to a staff report in connection with House Resolution

CHART 3.-CBS-owned stations compared with all United States standard broadcast stations-rates and revenue

64 of the Seventy-ninth Congress relating to small business, in some industries a single company accounts for as much as 85 percent of the total industry product. Attached hereto as appendix A is a copy of a compilation taken from that report indicating a selection of 59 industries where the proportion accounted for by a single company ranged from 5 percent to 85 percent.

Section 33 (c) (2) would, if enacted, preclude any expansion of CBS operation of standard broadcast stations, and would seriously jeopardize present operations. That point was underscored by Mr. Denny in his testimony as well. This section of the bill would limit the size of broadcasting licensees by a new measurement device keyed to population. This is the exact opposite of congressional action in the field of the press. In fact, Congress has encouraged the expansion of magazine and newspaper circulation by providing special mailing privileges. The most unusual feature, however, of section 333 (a) (2) is that the 25 percent limitation applies to potential rather than actual listeners. Thus, while any national magazine, for example, has a potential circulation among all the people in the Nation, a 100-percent potential, the radio stations owned by any single company would be limited to a 25-percent potential.

This curious concept results in some interesting comparison when the figures of actual audiences to CBS-owned stations are projected to areas which could be considered as having "primary service" under various alternatives.

The FCC has not adopted a final definition of what constitutes "primary service." Heretofore the "one-half milivolt contour" has been generally accepted as the standard for daytime primary service, but fluctuations in nightime service make signal strength alone unacceptable as a standard. In a recent hearing before the FCC, new standards of measurement, referring to A, B, and C service, have been

proposed. At the present time, none of these proposals, however, has been officially adopted as the definition of "primary service."

The following chart, chart 4, reflects the population figures under various possible definitions of "primary service" and the number of potential listeners to the CBS-owned stations compared with those who actually listen to the average program broadcast by these stations. We have used various engineering standards for the simple reason that the Commission has not yet set any specific engineering standard nor has this bill specified what is "primary service." That is up to the Commission. That, of course, could be changed from time to time. We have used a variety of engineering standards here. These are engineering standards which are, as is pointed out, under consideration by the FCC, but you can see that if rule A applied, for the potential, we would be well under the 25 percent. However, if they went to rule C, and I might add that the figures the FCC gave the other day in Mr. Denny's testimony were rule C figures, we would be well over the 25 percent, and on a potential basis would be forced to sell or dispose of some of our properties. But here again I want to point out the distinction between the actual and the potential. In New York City, where there are 23 stations, no single station gets all of the circulation of all of the people in that area.

It will be noted that the potential listening population for CBSowned stations varies from 15.8 percent to 37.6 percent under various engineering definitions, while the actual listening to the average program broadcast by these stations varies from 0.36 percent to 2.27 percent of the total United States population. Thus there is a vast discrepancy between actual and potential listeners. Competition among stations for listeners is the essence of broadcasting. No station reaches the entire population within hearing distance. Within the leading metropolitan markets in which the CBS-owned stations are located, a large number of stations compete for listeners. For example, there are 23 competing stations in the New York metropolitan district alone, and there are an aggregate of 71 competing stations in the remaining 6 metropolitan districts where CBS owns stations.

No business operation can remain healthy and dynamic if it is prevented from growing. The antitrust laws are fully applicable to broadcasting and should govern in this field as in others in the determination of what constitutes oversize or restraint of trade. Certainly there is no reason why Congress or any governmental agency should act with respect to the broadcasting field without considering similar industries. The newspapers, magazines, and broadcasters are all competitors for audience and advertising revenue, and any governmental action which limits broadcasters' ability to compete with other media is unfair class legislation.

The CHAIRMAN. I would like to say, so far as this committee goes, we are trying to confine ourselves to the statutory jurisdiction we have. We are not the Judiciary Committee of the Senate that may have to do with antitrust legislation. That is not our job.

Mr. STANTON. I appreciate that.

The CHAIRMAN. We deal with something entirely different.

Mr. STANTON. Further, as indicated above, the provision of S. 1333 is too uncertain to enable broadcasters to determine what their position would be under such a law.