In November of 1935, when this invention was publicly demonstrated, radio had that opportunity of going forward, with practically unlimited numbers of channels. But the networks did not do that. They stood aside. And some 6 months later, one of them assisted the Commission in closing the radio border above 30 megacycles. So that there was assigned to this invention only five workable channels where FM broadcasting could be practiced in a workable way.

Now, let us see what the effect of that was.

The immediate effect was to kill off interest among the broadcasters in going forward. Because it was a very simple thing to let it be known that, obviously, with only five channels assigned to FM broadcasting, no national service could be developed.

Then the next major development would be television, which got the major assignment in the workable part of the frequencies above 30 megacycles.

The long-time effect of the situation forced me into the position of having to risk hundreds of thousands of dollars to build a station that would demonstrate that FM would do what I said it would do, that is outwork the existing 50-kilowatt broadcast stations. Now, it took us 4 years. I say "us. I mean, with the help of some enterprising independents, the Yankee Network, Franklin Doolittle, and a few of the enterprising engineers who went along.

It took us 4 years to get out of that strait-jacket. And we did that in May of 1940, with the help of a new Chairman of the Federal Communications Commission, the third Chairman to hold office during the period that I have discussed so far. That was Chairman Fly. And the band was expanded from five channels to 40 channels in May of 1940.

That was the situation when I was here the last time, and when I thought we had a green light and were in the clear. And so we were. But in the interim something happened. At the end of the war we had a very bright outlook. There was a tremendous market for FM or any kind of radio receiver, a replacement market. The stations were on the air and operating. The manufacturers were tooled up, ready to go.

In 1943 the Commission had suggested to industry that a radio planning board be set up to plan for the postwar period. The committee dealing with the allocation of wavelengths practically unanimously agreed to go ahead from the present position of FM. I believe the vote was 25 to 1, or something like that.

In October of 1944 the Commission held a hearing, and toward the end of the hearing an ex-employee of the Commission appeared with the proposal that FM be moved bodily upward to above 100 megacycles. Its present position, he said, was unworkable because of intolerable interference.

Now, we did not agree with him. The authorities on the other side were Dr. G. W. Pickard, the oldest propagation expert in the country, Dr. Harlan Stetson, professor of cosmic meteorology in the Massachusetts Institute of Technology; Dr. J. H. Dellinger, Chief of the Radio Section of the Bureau of Standards and world-wide authority on the subject of propagation; Dr. C. W. Burroughs, now dean of the school of engineering, Cornell University; Dr. Harold Beveridge, the most experienced propagation man of the RCA Communications

Co.; Stewart L. Bailey, of the well-known firm of Jansky & Bailey, leading Washington consultants. And, incidentally, I have had a little bit of propagation experience myself for 40 years.

Nonetheless, the Commission moved us up.

Now, that was in the summer of 1945. And to date we have been trying to get back to where we were at the beginning of hostilities. We have just about gotten back, as to the number of receivers out, and we have a substantial increase in the number of transmitters. But I want to tell you we came very close to being kept on dead center. I don't believe anyone who has not been in the front line of this thing realizes how nearly we came to being wrecked.

It is easy to look back now and say, "Well, you are all right now." So we are. But it has taken 11 years to get there.

Now, I believe there was an error made in moving us up. I don't believe now that it makes any difference so far as stopping FM is concerned.

The CHAIRMAN. Who got the frequencies from which you were moved? What character of service?

Dr. ARMSTRONG. Most of those channels, Senator White, went to television, and television is a service that is much more subject to interference than FM; much more, 10, 20, 30 times more subject to interference.

There is one thing in this transition that I want to refer to, because I think the Commission acted in a most high-handed manner. And I think your committee might well study what happened.

At one time, a year and a half ago, they proposed to shut down the FM stations operating in the old band, which was the only way we could hold this thing together commercially, because some receiving set manufacturers who genuinely wanted to help the FM system along proposed to do the only thing they could do to meet the chaos that they saw was coming. And that was to make their receivers have two bands; that is, so that they could receive the old stations until the new ones got on the air.

Yet, because the manufacturers proposed to do this thing and did do this thing, the former Chairman of the Commission in a public statement threatened to close down the stations then operating and cut off existing service; although no new band transmitters were in operation, nor in fact could be obtained, and receivers for the new band did not exist.

Now we have survived it, but I want to say right here that I am in favor of your sections 4 and 5 to curtail the power of the Chairman. Under two Chairmen who have been active-in this case Chairman Fly and at present Chairman Denny-we have been making good progress, but one Chairman can do far more damage than two favorably inclined Chairmen can compensate for.

Here we are, 11 years after this invention was made and demonstrated to the scientific world; and just 1 percent of our people have it. And it has the solution of your regulation problem insofar as the shorter channels are concerned. Or at least, it had it before the artificial shortage was created back in the summer of 1936.

The CHAIRMAN. Would you comment at all on licensees being also manufacturers of radio apparatus? Perhaps I had better put it the other way. Manufacturers of radio apparatus being also licensees?

Dr. ARMSTRONG. I am very much afraid, Senator White, that that has had the effect of warping a man's judgment as to what he ought to do when he sits on both sides of the fence.

I don't think the leader in this industry led as you would expect it to in the development of a new art with all the opportunities for advance which this invention offered. On the other hand, there are some organizations who operated broadcasting stations-were in the broadcasting business and were also manufacturers-who went ahead. They were smaller owners of broadcasting stations; that is, they were not the major factor in the industry. But nonetheless they went ahead with the development.

As an inventor, I would hesitate to step outside my own field and try to suggest to you how to legislate, but there is one thing that I do want to say and that is this, I would not face a situation like this again for anything. The risks are too great. And I would not advise anyone who is going to follow invention as a profession to take the risks that I did.

Something has got to be done about it, or the future development of radio will simply be handed over to the large organizations and the well-organized lobbies.

But certainly with the power which now rests in the Chairman of the Commission, for good or evil-we have had both kinds-the risk is too great.

I will say the same thing right now that I said the last time I was here. We are doing very well. We hope we will be doing better. But there is always the chance of something changing. And the risk is still too great. I suggest something written into the law that gives the right of appeal from arbitrary action.

The CHAIRMAN. Well, of course, the great difficulty which confronts us, as members of the legislative branch, is that no one of us can qualify as an expert in this field. We have to stumble along with very limited and imperfect knowledge and do the best we can. Dr. ARMSTRONG. I will continue.

In my last appearance before your committee on December 6, 1943, I brought to the attention of the committee certain facts then existing with respect to a new method of broadcasting known as frequency modulation, or FM, broadcasting.

In that testimony I summarized briefly the circumstances surrounding the invention of this new system, explained what it would do in combating those forces of nature which bedevil radio communication, and what it would mean to the country by relieving the shortage of channels and thereby creating new opportunities to engage in the broadcasting business.

No one now disagrees with my statement, made at the time of the previous hearing, that the future of aural broadcasting lies in FM. The present Chairman of the Commission and the chief executives of the major networks are on the public record to this effect.

Summarizing briefly for the benefit of those members of the committee who did not hear my previous testimony, the advantages of frequency modulation are practically complete elimination of the effects of thunderstorms; great reduction in interference from man-made disturbances and from other stations; far better quality of reproduction than the standard or AM system; and the ability to operate, at

the time of its invention, in a part of the radio spectrum which was then entirely unused—that is, above the 30-megacycle border where great numbers of new channels could be made available.

Yet although the system was publicly demonstrated and explained in November 1935 to the engineers of the major radio broadcasting and manufacturing companies and reported fully in the technical press at that time, today, over 11 years later, it is doubtful if more than 1 percent of the population of the country enjoy its benefits.

The situation is quite without parallel in the history of radio. Never before in all my 40 years' experience in the art have I known of a case where a new and useful radio system was not put to work promptly. But here we have an invention which was not a mere ordinary invention, but one which overcame radio's greatest technical difficultystatic interference-long believed to be impossible of accomplishment. It was an invention which also had the capability of solving the Commission's most difficult administrative problems brought about by the shortage of channels in the standard broadcast band, and all that that means to the subject of freedom of speech. But still 99 percent of the people do not have the advantages that should have flowed to them from this advance in the art. I believe the reason to be the abuse of the regulatory power.

Now the Commission has stressed technical limitations of the number of channels on which the art of broadcasting can be practiced as the main reason for regulation. These regulations and their bearing on the question of the freedom of speech will be discussed by men better equipped than I to analyze them. On this phase of broadcasting's problems I simply make the statement that the solution of the shortage of channels has been in existence since 1935; that is, at the time when FM demonstrated it could operate at frequencies above the then known radio frontier.

It may be that the existing and the proposed regulations are necessary with respect to the conditions as they exist in the AM band todayI do not know that such regulations as are now proposed, which are based on the shortages of channels in the AM system, would never have had to be proposed if the art had gone ahead in 1935-or had been permitted to go ahead in 1935, in accordance with the normal American free enterprise system. Instead of going ahead at that time when the radio frontier was wide open, the leaders of the industry stood by and permitted or assisted the FM system to be boxed up by the Commission, the border closed, and an artificial shortage of channels created.

I do not mean to say that the new system in 1935 could have been made available immediately to the public throughout the country. Before that could happen much engineering and development work had to be done and a great deal of money had to be spent-the two most important elements of what we call our free enterprise system. But the engineering and inventive brains were available and there was ample reward in store for inventors in a system that would give the public an incomparably better service and relieve the shortage of broadcast wavelengths.

In spite of all our resources and in spite of the best efforts that could be put forth by some very able engineers, the public still does not have it. And I submit that the fact is due mainly to the Commission and its failure to obey the mandate of Congress to encourage new developments in the radio art. The single exception when FM development

was encouraged during the tenure of office of one of the four Chairmen I will refer to later.

The story of the difficulties with which this system has been confronted is a long one. To bring it up to date and for the benefit of members of the committee who did not hear my previous testimony, the following summary is set down. Within 10 days after the public disclosure (November 6, 1935) of the invention, the assistant chief engineer of the Commission in a newspaper interview branded it as a visionary development. Then the same individual, acting on that preconceived notion and being in charge of approving experimental licenses, refused to approve such a license to permit me to demonstrate that the new system would do what I said it would do: outperform the existing high-power standard broadcast stations. I ask you to consider what I was requesting. No public financing was involved, no authorization to charge for time on the air, nothing but the privilege of spending my own money to demonstrate to a skeptical world that there was something better to be had than the existing broadcast system.

An experimental license was finally obtained, but only after many months of effort-months during which I had to turn aside from development work on the FM invention and give a major part of my time to the job of getting an engineer overruled who had decided in his own mind that my system was not sufficiently meritorious for me. to spend my own money on it.

The experimental license was issued in the summer of 1936 and I went ahead to erect a station adequate to the purpose. Difficulties, however, were only beginning. Before the license actually issued, the Commission had taken steps which had the effect of making the rapid development of the new system impossible. In 1935, when FM was publicly demonstrated, the radio frontier ended at 30 megacycles. All frequencies above that figure were as wide open for developmental purposes as was the territory beyond the Alleghenies when they formed the western boundary of the American Colonies.

Within 6 months, and before I got my experimental license, the Commission held a hearing, closed the frontier beyond 30 megacycles, and assigned five useful channels only to FM beyond the border. The great number of channels available when the invention was made disappeared through the device of assigning them to other services which never used them.

The immediate effect of this was to kill off interest in the new system, since it was obvious that no national service could be developed on five channels and no service adequate to pay the cost of operation. The long-time effect was to force upon me the financial burden of risking hundreds of thousands of dollars to demonstrate a system which, even if it were successful, might wind up with no place in the spectrum to develop. I have no hesitation whatever in saying that with only five channels assigned to FM, the feeling in the radio art was that it had been successfully bottled up. No one expected me to take the risk.

Four years of effort were required to break the bottleneck which was accomplished with the pioneering help of some enterprising engineers and a few broadcast station owners of low-power stations who saw the business opportunities in the chance to render a better public service in their territory. These pioneers, particularly the broadcasters,