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Senator MAGNUSON. In one sentence, the more competitive you become, the less regulation you think should be imposed upon the small market operator.

Mr. PENGRA. On any operator.

Senator MAGNUSON. Take your own.

Mr. PENGRA. Yes. We feel in our particular field there are certain problems that are relative generally to our industry, but are specific to the small market operator. As a matter of fact, the very complicated report forms that are requested by the Commission now constitute quite a burden. I have those forms. Have you ever seen those forms, any of you gentlemen? Have you been through them page by page?

The CHAIRMAN. I have been spared the affliction of going through them.

Mr. PENGRA. Hearing you refer to it that way gives me some confidence. That is exactly what it is.

The CHAIRMAN. I can understand that there always is a question as to the wisdom of a particular regulation that is sought to be enforced, but I think you are wasting your time when you challenge the right of the Government to impose regulations.

Mr. PENGRA. I do not, Senator, challenge the right of the Government to impose regulations, provided then it stays within the field that clearly authorized us in a business basis to move ahead as any other free American enterprise.

The CHAIRMAN. If you take the position that they cannot impose a regulation on you beyond any regulation that is made, imposed upon, we will say, a grocery store, I still think you are just wasting your time.

Mr. PENGRA. May I make the analogy with the newspaper? Should we be subject to any more regulation than the newspaper? Considering that the grant of the mailing privilege is much more of a bountiful subsidy presently than the grant of a frequency?

The CHAIRMAN. Whether you should be or not, that is one question, but if you are asking me whether the Federal Government has the right to impose a limitation and restrictions and rules of conduct upon you that are not imposed upon a newspaper, unhestitatingly I say, "Yes; the Government can.

Senator JOHNSON. I wish the witness, instead of comparing his industry to the newspaper industry, would compare his industry to national banks, who also operate under the sufferance of Government. They have particular regulations that they have to meet.

Mr. PENGRA. I am not familiar with the regulations of those banks, and I do not quite understand the analogy.

Senator JOHNSON. You keep talking about free enterprise and that sort of thing. I am sure that the banks consider themselves operating under our free-enterprise system, and yet they operate under license by the Federal Government.

Mr. PENGRA. They do not, of course, operate under the first amendment, as radios and newspapers would, with that fine distinction in

there.

Senator JOHNSON. I am a strong believer in the principle laid down by Thomas Jefferson that that government is best which governs the least, and I hope that we can maintain that same principle in radio.

But we must have government here; there is no other way. You cannot get out of it. You cannot operate without government. Harry Bannister stated my case perfectly a moment ago, and I think if you would address some of your questions to him, you would get the answers that you need.

Mr. PENGRA. Senator, I am not suggesting that the radio industry requires no regulation whatsoever. I am suggesting that radio does not need, nor should not have regulations concerning its programs which it puts on the air. That primarily I am interested in for I think that that constitutes a business regulation without any question. Under the present plan for the renewal of license, under the present Commission plan of the annual report in which you must break your program structure down to show what percentage was entertainment, what percentage was educational, what percentage was news, what percentage was religious, fraternal, civil and so forth, when we are asked to break down that each time, there can be no question in my mind that it constitutes a threat to the renewal of license unless we fit the prescribed limitation, whatever that may be, by the Commission. The business of when you apply for a radio station of saying this shall be my program, they ask you for a suggested program with a number of hours devoted weekly to certain types of entertainment and certain types of programing. Then each year you must show whether or not you kept that balance. Who is to say that such a balance as that is to be kept when it is in the realm of pure programing? Who is the rightful judge of what the balance of any radio station is?

Senator JOHNSON. The Congress has that responsibility and the Congress has delegated that responsibility to its creature, the Commission. I think Congress would like to get out of that job. I do not think it is a very pleasant job. It is a very difficult job, but we have to protect the people. We have to protect the listeners. Somebody has to be an umpire; even a baseball game has to have an umpire.

Mr. PENGRA. Senator, has there been a mandate from the people to Congress that radio is so bad that you really need some serious changes in its programing?

Senator JOHNSON. I do not know about the serious changes in the programing. I do not know what the voice of the people is calling for. We find out every 2 years when we have an election.

Mr. PENGRA. Do you mean that you do not know what the voice of the people is calling for so far as radio is concerned?

Senator JOHNSON. I think I know, but I doubt whether you know. I doubt whether you believe in representative government. I doubt whether you have very much confidence in Congress. I doubt whether you believe much in Congress. I doubt whether you fully understand the responsibilities of Congress. You are asking for information; I give you my opinion.

Mr. PENGRA. I do not think that is information, although I am taking it right in the teeth. It is about the best I can do under the circumstances. I really do not think you mean the charge, and I suffer it. On the other hand, the question here, I asked you a question, and I do not mean to be impertinent with it.

Is it true that the people of this country have protested loudly about radio as it operates now? The people, I mean. I mean that great

body of listeners out there to whom we, as radio station operators, play, 16 to 18 to 20 hours a day in the hopes that we can capture their attention?

Senator MAGNUSON. Let us assume that there has not been any substantial complaint. Still there is no reason why the present system of regulation should not be continued. Are you opposed to that?

Mr. PENGRA. The present system of regulation?

Senator MAGNUSON. What we are afraid of is that if we do not have adequate and reasonable regulations that there might be some complaints and that when those complaints come, they will hurt not only the radio industry, but they will hurt the people and the responsibility will rest with us.

Mr. PENGRA. Senator Magnuson, until such time as the radio stations of this country operate so poorly and so completely out of the public interest as to constitute a growing and a legitimate wrath on the part of the people agaisnt radio stations, is it required that the Government protect the public taste, which at present, as far as we can determine in radio, and heavens know we make every measurement known to determine it, seems to be sound.

Senator MAGNUSON. Is that not a good argument for the very regulations that you complain of? It is good now; probably in some measure these regulations have helped.

Mr. PENGRA. Do you think that the regulations have been responsible for radio's present development, or is it possible for you to believe as I do, that the radio has succeeded thus in spite of the regulations?

Senator MAGNUSON. That I do not know, but nevertheless if it is good now, it is a good argument for the fact that the present regulations might be well-founded.

What I want to ask you specifically about this bill is are you opposed to the present regulations?

Mr. PENGRA. As they stand now on several counts I am opposed to them.

Senator MAGNUSON. Are you opposed to the clarification of those regulations or the further provisions of the bill which would continue and amplify these regulations. Are you opposed to that?

Mr. PENGRA. I am opposed specifically to section 16, which regulates the business of the radio.

Senator MAGNUSON. That is what we want to know. We want to know what you are opposed to.

Senator MOORE. What you are opposed to in that connection mostly, as I understand it, is with reference to arranging your programs, is that it?

Mr. PENGRA. Yes, sir.

Senator MOORE. You seem to have included in that also the report on your financial situation.

Mr. PENGRA. Yes, sir.

Senator MOORE. Are you opposed to making reports upon what the financial results have been in operating the station?

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Mr. PENGRA. Senator, may I clarify that in making an answer? I am opposed to it on this basis. I have nothing to hide in my programing. ˆ I am proud of most of it. For such a small station there is some that I am not proud of, that I can not say I am. There are limitations that I have heard discussed here of various types. I am not opposed

to letting anybody see my program, but I am opposed to being required to give those programs every year, and to show them to the FCC. I am also opposed to making a special financial report to the FCC, not that I have anything to hide or ever will have anything to hide, but it is not the type of thing that other American business enterprises are subjected to; why is radio?

Senator MOORE. Radio stands in an entirely separate class from many others.

Mr. PENGRA. I think only in respect to its licensing from the Gov-ernment.

Senator MOORE. There is a limitation of the number of radio stations that can operate in this country, a physical limitation, a technical limitation.

Mr. PENGRA. Not as of today, Senator. That situation has changed. That was true during the war when the freeze was on and no radio station could be granted. It had been true for a number of years when radio was growing, and those who wished to come into the field were hesitant because it was comparatively a new art, but that is not true today.

Senator MOORE. You mean there is no limit to the number of stations that might be operated?

Mr. PENGRA. Practically speaking there is no limit, and from an economic standpoint the limit is not even in effect now. You heard Chairmain Denny.

The CHAIRMAN. If you are talking about the broadcasting band, you are in sharp disagreement with Commissioner Denny, who said in substance to us here the other day that there was going to be a lot of these stations that will have to get off the air unless there are improvements in the situation.

Mr. PENGRA. How do you mean, Senator?

The CHAIRMAN. You have a number of stations now licensed, a number of applications now pending which, if granted, as I understood Mr. Denny's statement, would pose a problem and would result in their elimination, either of their own choice or through the action of the Government itself. Economic forces would work an elimination of a substantial number of broadcast stations. That is the substance of what Mr. Denny said.

Mr. PENGRA. The economic part.

The CHAIRMAN. You are in disagreement with him.

Mr. PENGRA. As I recall Mr. Denny's figures, as of April 1, there were 1,610 radio stations. I am not sure on this. I think that includes those on the air and construction permits as of that time.

The CHAIRMAN. As I understand it, as I recall it, and my recollection may be wrong, there were something like 1,680 stations for which licenses had been issued or construction permits had been issued, and there were something like 800 other applications pending.

Mr. PENGRA. 721, sir.

The CHAIRMAN. He indicated that if those licenses were granted as a matter of right, that there would have to be a weeding-out process, and many stations would go off the air. That was the substance of what he said. And if anybody is authorized to speak with knowledge and finality about these radio questions, I submit that Mr. Denny came pretty near being that person.

Mr. PENGRA. Without a question, Senator. If I can clarify this for you, I mean from the standpoint of those of us who are in the industry, in town after town that you can name in our market division, the small market division, you will find one daily newspaper and from one to three radio stations.

The economic limitation of the spread of the daily newspaper is one of those things that now leaves it in many cases outnumbered by radio stations as high as three to one in these smaller markets, and naturally you know what the ratio is in the larger ones. I mean to indicate that there is no lack of opportunity in the radio field, as compared to the next closest media that would be related to it.

If that constitutes any difference in the opportunity in the field, I fail to see it; and I know this much, gentlemen, that there are many small market stations that are granted at the present time who are constituting second and third stations in a small market that will live for a short time in the present prosperity and will die as the result of not enough business. They are going to be weeded out on the basis of economics of the situation. They are not going to be left out because of lack of frequencies.

Senator CAPEHART. May I ask a question? How many AM stations are there at the moment?

Mr. PENGRA. It is my understanding, according to Mr. Denny'sstatement, that there are 1,610; that includes on the air and construction permits.

Senator CAPEHART. How many additional bands available?

Mr. PENGRA. How many additional bands; you mean frequencies? Senator CAPEHART. Yes.

Mr. PENGRA. I would have no way of answering on that.

Senator CAPEHART. How many FM stations?

Mr. PENGRA. Presently there are 721 applications. It is my understanding. I hope you will not take these figures as final.

Senator CAPEHART. How many additional frequencies available? Mr. PENGRA. There again I do not know.

Senator CAPEHART. Does anyone know?

Mr. PENGRA. I am sure there must be someone in the room who can furnish that information. There are men here——

Senator CAPEHART. How many television stations are there at the moment, and how many additional frequencies available?

Mr. PENGRA. That I cannot answer, Senator. I do not know how many television stations there are.

Senator CAPEHART. Is there anyone here from the FCC that could give us that information?

Senator JOHNSON. It is in the record. Mr. Denny gave us that. Senator CAPEHART. I Would like to have it in the record at this point for information.

Mr. PENGRA. Here is the box score, from Broadcasting magazine: Standard stations, 1,239 licensed, 522 construction permits.

Senator CAPEHART. How many additional frequencies available? Mr. PENGRA. We do not have that because it varies according to the application and the geographical position.

Senator CAPEHART. I understand that, but I was trying to figure out how many AM, FM, and television stations it was possible to have in the United States, if someone could give us that information.

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