ORGANIZATION, POWERS, AND DUTIES OF FEDERAL COMMUNICATIONS COMMISSION

Mr. WOODRUM. Do you want to make a general statement? Mr. SYKES. From the historical point of view, it might be well to call your attention to the fact that we had existing before the passage of the Communications Act a Radio Commission Act. The Radio Commission, which consisted of five members, had charge of radio broadcasting point to point communications, and of radio all over the country. It was a licensing body for radio. It had no ratemaking powers whatsoever. The Communications Act, which became a law just before Congress adjourned, provides not only for the regulation of both wireless and wired telegraph and telephone companies cables, and so forth, but it also gives the Communications Commission rate-making powers over common carriers of communications. Broadcasting stations are not common carriers.

Mr. WOODRUM. Do you mean the telegraph and telephone services? Mr. SYKES. Yes, sir; the telegraph and telephone services. Mr. WOODRUM. That is, over the tolls that they may charge. Mr. SYKES. Yes, sir; over the rates. It gives very wide powers to investigate the business and business set-ups of those various concerns, and to make reports to Congress as to possible amendments under the act. It gives the Commission the power to organize into divisions, as it sees fit. It might be of interest, Mr.Chairman, if I gave you gentlemen the organization of the Commission under the act. After going into the matter very carefully, on the 17th of July, we organized into three divisions. Division no. 1 is the Broadcasting Division; division no. 2 is the Telegraph Division, and division no. 3 is the Telephone Division. The law provides that not less than three members must be members of each division. All of the Commission members except the chairman are members of only one division, and the chairman of the Commission is the third member on all the three divisions. Now, in setting up those divisions of broadcasting, telegraph, and telephone, it was necessary to go carefully into the radio field to put in each one of the appropriate divisions the kindred radio matters. Without reading this, it is quite interesting to note the detailed set-up of broadcasting, amateur, aircraft, and coastal telegraph. It might be of interest to file this with the committee.

Mr. WOODRUM. And to have it inserted in the record.
Mr. SYKES. It might be of interest. This shows the general set-up.
Mr. WOODRUM. We will insert it in the record at this point.
(The statement referred to is as follows:)

FEDERAL COMMUNICATIONS COMMISSION, Washington, D. C., July 17, 1934. The Federal Communications Commission organized its divisions today in keeping with the communications act. Three divisions composed of three members each were created, with Chairman E. O. Sykes serving on each division. The divisions and personnel follow:

Division No. 1, broadcasting.-Commissioner Gary, chairman; Commissioner Brown, vice chairman; Commissioner Sykes.

Division No. 2, telegraph.-Commissioner Stewart, chairman; Commissioner Payne, vice chairman; Commissioner Sykes.

Division No. 3, telephone. Commissioner Walker, chairman; Commissioner Case, vice chairman; Commissioner Sykes.

The broadcast division shall have and exercise jurisdiction over all matters relating to or connected with broad casting.

The telegraph division shall have and exercise jurisdiction over all matters relating to or connected with record communication by wire, radio, or cable, and all forms and classes of fixed and mobile radiotelegraph services and amateur services.

The telephone division shall have and exercise jurisdiction over all matters relating to, or connected with, telephone communication (other than broadcasting) by wire, radio, or cable, including all forms of fixed and mobile radiotelephone service except as otherwise herein specifically provided for.

The whole Commission shall have and exercise jurisdiction over all matters not herein otherwise specifically allocated to a division, over all matters which fall within the jurisdiction of two or more of the divisions established by this order, and over the assignment of bands of frequencies to the various radio services. In any case where a conflict arises as to the jurisdiction of any division or where jurisdiction of any matter or service is not allocated to a division, the Commission shall determine whether the whole Commission or a division thereof shall have and exercise jurisdiction, and, if a division, the one which shall have and exercise such jurisdiction.

The following radio services and classes of stations were allocated to the three divisions established as follows:

1 All matters relating to or connected with this class of station concerning the development of apparatus for any service assigned to the Broadcast Division.

Stations in Alaska only.

3 All stations of this class except those assigned by designations (1) and (6) to the broadcast division and telephone division, respectively.

The broadcast division will hold its first meeting at 10 o'clock Wednesday, July 18, 1934; the telegraph division will meet at 10 o'clock Thursday, July 19, 1934; the telephone division will meet Friday at 10 o'clock, July 20, 1934.

Next week the broadcasting division will meet at 10 o'clock on Tuesday, the telegraph division at 10 o'clock on Wednesday, and the telephone division on Thursday at 10 o'clock. These will probably be the regular meeting days of the divisions.

HEARINGS HELD ON ALLOCATION OF BROADCASTING
EDUCATIONAL, ELEEMOSYNARY INSTITUTIONS,

FACILITIES TO

ETC.

Mr. SYKES. Each division meeting separately has adopted a number of general orders. In brief, we took the Communications Act, and we figured on what general orders under that act should be adopted by the Commission to carry out the act. Then we adopted those orders. I presume that all of the divisions, as well as the Commission in banc, up to this time have adopted between 30 and 33 or 34 general orders. We have had a number of hearings in each division of the Commission under the new act. For instance, there is a section of that act which provides we shall carefully consider the question of whether, or not-I am not pretending to quote the exact language of the act, but rather to get its sense any part of the broadcasting facilities should be allocated for nonprofit, educational or eleemosynary institutions of any character. The Commission in banc delegated that duty to the broadcasting division. I should say further that reports to Congress will be made as to whether, or not, the law should be changed in that respect. That hearing before the broadcasting division lasted for 6 weeks, and we are at work now analyzing the testimony preparatory to making our report.

Mr. WOODRUM. Were other than educational institutions heard in that, or other than the people directly involved?

Mr. SYKES. Everybody was notified that we thought had any possible interest in it, and quite a number of appearances were made. It was quite an interesting hearing, and I think it will be quite an interesting report.

Except ship telephone stations connecting through coastal telephone stations with the public telephone network. Except stations in Alaska.

All matters relating to or connected with the research, development, and operation of public telephone service.

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Ship telephone stations connecting through coastal telephone stations with the public telephone network.

The usual broadcasting procedure is going on. Of course, that was a going concern, and it is coming along very nicely.

Mr. WOODRUM. Did the Communications Act make any change in the system of licensing, from the short period of licensing? Mr. SYKES. No, sir; we have the same authority under the Communications Act that we had before to license stations.

Mr. WIGGLESWORTH. Are you following the same policy?
Mr. SYKES. Yes, sir; there has been no change in the policy.
Mr. WOODRUM. Those licenses are for short periods?

Mr. SYKES. Six months for broadcasting stations, 1 year for point to point, and 3 years for amateurs. We are making a very interesting study of the broadcasting field at the present time. It has just begun. That covers the actual service that is being given by broadcasting stations. Field measurements are being made, so that we will be able to have the actual data on the service of broadcast stations ourselves. We have wanted to do that for some time, and through the cooperation of the broadcasting stations we are doing it now. That work has been started.

HEARINGS HELD BY TELEGRAPH AND TELEPHONE DIVISIONS

We have a very interesting hearing going on at the present time before the Telegraph Division. There has been a great deal of talk about the possibility of mergers of the telegraph companies for some time, and it was one of the things for which a special committee was appointed by Secretary Roper, at the request of the President, some years ago. It made some report about it, making recommendations along that line. They thought something should be done. That hearing is now being conducted by the Telegraph Division.

We have had some hearings before the Telephone Division on depreciation and accounting, and we have a hearing scheduled before the Telephone Division to begin sometime about the first of the year on the business practices of the telephone companies. We will get that started as soon as we get our accounting department thoroughly organized. We have been having some trouble in getting accountants, and we have a lot of preliminary work to do before we can begin that. The Communications Commission members have been very busy. The Commission has been very busy since it started, and it will have several very busy years ahead of it.

RADIO RELATIONS WITH CANADA AND MEXICO

Mr. WOODRUM. What is the status of the Canadian situation that you have told us about from time to time?

Mr. SYKES. Do you mean the Mexican situation?
Mr. WOODRUM. Yes; the Mexican situation.

Mr. SYKES. At the last session, Congress adopted, on our recommendation, a measure curtailing the establishment of studios in this country, or any offices of any kind for the purpose of transmitting to foreign countries. That was a change in the law. Dr. Brinkley's station was closed, and we have had a conference with Mexico. A license for that station has been denied by the Mexican Government. I understand that an effort is being made by him to get a new license under the new President of Mexico. There has been no apparent

change, with that one exception, since our conference down there. There has been nothing looking toward another conference up to date. Mr. WOODRUM. I have something in my head about an international conference of some kind on radio.

Mr. SYKES. We had a conference of what is called the "CCIR." That is an international technical advisory committee on radio that meets every 2 years, I believe. They met at Lisbon this summer. They make recommendations. They compare notes on technical matters and make recommendations as to changes. The next big international radio-telegraph conference will be held at Cairo, Egypt, in the latter part of 1937 or the first part of 1938. I understand they will meet in the first part of 1938.

Mr. WOODRUM. There are certain facilities set aside for Canadian use that are denied to American operators.

Mr. SYKES. Yes, sir; we have an agreement with Canada. Our relations with Canada have always been very cordial. We have an agreement with Canada whereby they have the exclusive use of 6 channels, and then we share with them 12 channels. We have the exclusive use of all the other broadcast frequencies. We never had that sort of agreement with Mexico, and that is where we have interference. If anything comes up with Canada, we usually get together informally and iron the differences out.

INSUFFICIENCY OF APPROPRIATION FOR 1935-ESTIMATE FOR 1936

Mr. WOODRUM. Going back to the appropriation for a moment, the total appropriation for the Federal Radio Commission for the fiscal year 1935 was $651,885. That was the appropriation on July 1.

Mr. SYKES. No, sir; under this bill, the new communications bill, this appropriation was turned over to the Communications Commission. It will require a deficiency appropriation. We figure that we can run until about February 1 on the old appropriation.

Mr. WOODRUM. Do you know what your deficiency will be? Mr. SYKES. It will be prorated on the basis of this $1,500,000 that we are asking for now. We will go to the Budget for that.

Mr. WOODRUM. It will cover the personnel called for in this 1936 budget that you now have set up.

Mr. SYKES. Yes, sir.

Mr. WOODRUM. It will cover this same personnel?

Mr. SYKES. Yes, sir. I have great trouble in following the way they make these things out in this break-down. I like to see what is legal, what is engineering, what is administrative, and all of those things.

NUMBER OF PERSONNEL NOT UNDER CIVIL SERVICE

Mr. WIGGLESWORTH. How much of your personnel is not subject to civil service?

Mr. SYKES. The chief engineer, the general counsel, 3 assistants to the chief engineer, and 3 assistants to the general counsel.

Mr. WOODRUM. Are those assistants to the general counsel lawyers? Mr. SYKES. Yes, sir. Then, the secretary for each commissioner, the secretary of the Commission and the director for each Division are excepted from civil service. All of the other employees come under the civil service.