information

Electronic media forms

A wide variety of electronic media exists for the dissemination of entertainment and information.  

Within less than the average lifetime, these media have proliferated into more than a dozen forms. These media both complement and compete with one another, experiencing the slings and the security of the free enterprise system. Some people wonder how many forms of media the market can bear; others marvel at how many it does bear. As these media develop, change is inevitable, brought about by external and internal forces. Although all the media forms are relatively young, they are already rich in history and adaptation.

Radio

Radio knows how to reinvent itself.  At present it consists largely of .disc jockeys announcing music, of talk-show hosts engaging in controversial discussions and of newscasters giving the latest information. This, however, has not always been the case.

During the 1930s and 1940s, radio was the main source of national entertainment programming. Most of the models of entertainment and information that are common to the media today were formed by radio during these years. When television took away radio's audience in the 1950s, some believed radio would die, but today it is a healthy medium that enters homes, automobiles, and many other places people inhabit.

Early inventions

The very beginnings of radio are veiled in dispute People living in various countries devised essentially the same inventions. Ironically, this was partly because no communication system was available for people to learn what others were inventing, this led to numerous rivalries, claims, counterclaims, and patent suits

Many people believe that radio originated in 1873 when, James Clerk Maxwell, a British physics professor, published his theory of electromagnetism.

His Treatise predicted the existence of radio waves and how they should behave.

During the 1880s a German physics professor, Heinrich Hertz, undertook experiments to prove Maxwell's theory. Hertz actually "generated at one end of his laboratory and transmitted to the other end the radio energy that Maxwell had theorized.

Guglielmo Marconi Expanded upon radio principles. Marconi, the son of wealthy Italian father and an Irish mother, was scientifically inclined from an early age. Fortunately, he had the leisure and wealth to pursue his interests. Soon after he heard of Hertz's ideas, he began working fanatically in his workshop, finally reaching a point where he could transmit the dots and dashes of Morse code using radio waves. Marconi then wrote to the Italian government in an attempt to interest it in his project. The government replied in the negative. His determined mother decided he should take his invention to England.

There, in 1897, he received a patent and the financial backing to set up the Marconi Wireless Telegraph Company, Ltd.

Under the auspices of this company, Marconi continued to improve on wireless technology and began to supply equipment to ships. In 1899, he formed a subsidiary company in the United States.

Although Marconi maintained a dominant international position in wireless communication, many other people were experimenting and securing patents in Russia, Germany, France, and the United States. People became intrigued with the idea of voice transmission and, in 1904; John Fleming of Britain took a significant step in this direction. He developed the vacuum tube, which led the way to voice transmission.

 It was developed further by Reginald Aubrey Fessenden and Lee De Forest, among others.

Fessenden, a Canadian-born professor who worked at the University of Pittsburgh, proposed that radio waves not be sent out in bursts - which accommodated the dots and dashes of Morse code - but rather as a continuous wave on which voice could be superimposed. On Christmas Eve of 1906, Fessenden broadcast to ships at sea his own violin solo, a few Verses from the Bible, and a phonograph recording of Handel's "Largo".

De forest is known primarily for the invention of the audion tube, an improvement on Fleming's vacuum tube that he patented in 1907. It was capable of amplifying sound to a much greater degree than was previously possible. De Forest, like Marconi, was fascinated with electronics at an early age and later secured financial backing to form his own company.

 However, he experienced management and financial problems that frequently rendered him penniless and led him eventually to sell his patent rights.

 De Forest strongly advocated voice transmission for entertainment purposes. In 1910 he broadcast the singing of Enrico Caruso from the New, York Metropolitan Opera House. Several years later he started a radio station of sorts in the Columbia Gramophone Building, playing Columbia records (he later referred to himself as the first disc jockey) in hopes of increasing their sales.

 

 

 

Early control

During there early stages, radio grew with very few government controls. The first congressional law to mention radio was passed in 1910 and required all ships holding more than 50 passengers to carry radios for safety purposes.

The rules concerning this safety requirement were not very effective, as was proven with the 1912 sinking of the Titanic. As the "unsinkable" Titanic sped through the night on its rnaiden voyage, radio operator on other ships warned it of icebergs in the area. The Titanic's radio operator, concerned with transmitting the message of the many famous passengers, passed the warnings on to the captain, who disregarded them.

 The wireless operator transmitted SOS signals when the Titanic struck the fatal iceberg about midnight April 14, but none of the nearby ships, which could have helped save some of the 1,500 passengers and crew who died, heard the distress calls because their wireless operators had signed off for the night.

The operators on land who had been receiving the passengers' messages also heard the distress calls, so for the first time in history people knew of a distant tragedy as it was happening. One wireless operator decoding the messages in New York was reputed1 to be David Sarnoff, who .later became president of RCA. He and others relayed information about the rescue efforts to anxious friends and relatives and to the newspapers. This brought wireless communication to the attention of the general public for the first time.

Soon after the sinking of the Titanic, Congress passed the Radio Act of 1912 that emphasized safety and required everyone who transmitted on radio waves to obtain a license from the secretary of commerce. The secretary could not refuse a license but could assign particular wavelengths to particular transmitters. Thus, ship transmissions were kept separate from amateur transmissions, which were, in turn, separate from government transmissions. All this was done without any thought of broadcasting as we know it today.

Word war I

In 1917, during World War I, the U.S. government took over all radio operation, and bitter patent; disputes were set aside. Marconi's company, still the leader in wireless, had aroused the concern of American Telephone and Telegraph (AT&T) by suggesting the possibility of starting a wireless phone business.

 AT&T in an effort to maintain its supremacy in the telephone business, had acquired some wireless patents, primarily those of Lee De Forest. The stalemate that grew out of the refusal of Marconi's Company, AT&T, and several smaller companies to allow one another to interchange patents had stifled the technical growth of radio communications. Because of the war, these disputes were set aside so the government could develop the transmitters and receivers needed. World War I also ushered two other large companies into the radio field General Electric (GE) and Westinghouse, both established manufacturers of light bulbs. GE and Westinghouse assumed responsibility for manufacturing tubes because both light bulbs and radio tubes require a vacuum. General Electric had also participated in the development of Ernst F. W. Alexanderson's Construction of the alternator to improve long-distance wireless.

 The patent problem returned after the war, and GE began negotiating with Marconi's company to sell the rights to its Alexanderson alternator. The navy, which had controlled radio during the war, feared this sale would enable the Marconi Company to achieve a monopoly on radio communication. The navy did not want radio controlled by a foreign company, so it convinced GE to renege on the Marconi deal. This cancellation left GE sitting with an expensive patent from which it could not profit because GE did not control other patents necessary for its utilization, but the patent placed GE in an excellent negotiating position because of its value for long-distance transmission.

The founding of RCA

 What ensued was a series of discussions among Marconi American, AT&T, GE, and Westinghouse that culminated in the formation of radio Corporation of America (RCA) in 1919. The Marconi American subsidiary, realizing with reluctance that it would not receive navy contracts as long as it was controlled primarily by the British, transferred its assets to RCA.    AT&T, GE, and Westinghouse bought blocks of RCA stock and agreed to make patents available to one another, thus averting the patent problem and allowing radio to grow.

This was undertaken with ship-to-shore transmission in mind, not entertainment broadcasting.

One person who saw entertainment possibilities was David Sarnoff, a Russian immigrant who at age 15 had become an employee of Marconi and at age 21 is said to have received distress messages from the titanic. Legend has it that in 1915, at the age of 24, he wrote a memo to Marconi management suggesting entertainment radio that read in part as follows:

I have in mind a plan of development which would make radio a "household utility" in the same sense as the piano or phonograph. The idea is to bring music into the home by wireless. The receiver can be designed in the form of a simple "Radio Music Box" aiw&ange3 for several different wavelengths, which should be changeable with the throwing of a single switch oppressing of a single button…..

The same principle can be extended to numerous other fields as, for example, receiving lectures at home which can be made perfectly audible; also, events of national importance can be simultaneously announced and received. Baseball, spores can be transmitted in the air by the use of one set installed at the Polo Grounds. The same would be true of other cities. This proposition would be especially interesting to farmers and others in outlying districts removed from cities. By purchase of a "Radio Music Box," they could enjoy concerts, lectures, music recitals, etc….

It is not possible estimate the total amount of business obtainable with this plan until it has been developed and actually tried out; but there are about 15 million families in the United States alone, and if only one million or 7 -percent of the total families thought well of the idea, it would, at the figure mentioned ($75_per outfit), mean a gross business of about $75 million, which would yield considerable revenue.

This idea was not acted upon, and Sarnoff, who joined RCA when RCA bought out Marconi, had to wait for a more propitious time.

Early Radio Stations

Meanwhile, many amateur radio enthusiasts began undertaking experiments. One of these was Frank Conrad, a physicist and an employee of Westinghouse in Pittsburgh.

 From his garage he programmed music and talk during his spare time. A local department store began selling wireless reception sets and placed an ad for these in a local newspaper,

mentioning that the sets could receive Conrad's broadcasts. One of Conrad's superiors at Westinghouse saw the ad and envisioned a market. Until this time, both radio transmission and reception had been for the technical-minded who could assemble their own sets. It was obvious that sets could be preassembled for everyone who wished to listen to what was being transmitted.

Conrad was asked to build a stronger transmitter at the Westinghouse plant, one capable of broadcasting on a regular schedule so that people who purchased receivers would be assured listening fare. In 1920, Westinghouse applied to the Department of Commerce for a special type of license to begin a broadcasting service. The station was given the call letters KDKA and was authorized to use a frequency away from amateur interference. Because Westinghouse was the first to acquire this type of license, KDKA is generally considered the first radio station, but other stations that were experimenting at the-same time lay claim to the title of "first." KDKA launched its programming schedule with the Harding-Cox election returns, interspersed with music, and then continued with regular broadcasting hours. Public reaction could be measured by the long lines at department stores where radio receivers were sold.

KDKA's success spurred others to enter broadcasting, including David Sarnoff, who now received more acceptance for the ideas in his memo. He convinced RCA management to invest $2,000 to cover the Jack Dempsey-Georges Carpentier fight on July 2, 1921, and a temporary transmitter was set up in New Jersey for the fight. Fortunately, Dempsey knocked Carpentier out in the fourth round, for soon after, the overheated transmitter became a molten mass. This fight, however, helped to popularize radio, and both radio stations and sets multiplied rapidly.

By 1923, radio licenses had been issued to more than 600 stations, and receiving sets were in nearly 1 million homes." The stations were owned and operated primarily by those who wanted to sell sets (Westinghouse, GE, RCA) and by retail department stores, as well as radio repair shops, newspapers wanting to publicize themselves, and universities that wanted to offer college credit courses that people could listen to in their homes.

Unfortunately, all stations were on the same frequency—360 meters (approximately 830 on the AM dial). Stations in the same reception area worked out voluntary arrangements to share the frequency by broadcasting at different times of day. However, as more stations went on the air, interference became common. This was particularly hard on students trying to hear their lessons for college credit courses, and many universities had to cease this form of instruction.

out voluntary arrangements to share the frequency by broadcasting at different times of day. However, as more stations went on the air, interference became common. This was particularly hard on students trying to hear their lessons for college credit courses, and many universities had to cease this form of instruction.

Early programing

Programming was no problem in the early days. People were mainly interested in the novelty of picking up any signal on their battery-operated crystal headphone receivers. Programs consisted primarily of phonograph record music, call letter announcements, and performances by endless free talent who wandered in the door eager to display their virtuosity on this new medium.

Sometimes the use of amateurs created awkward situations. For example, a woman who was a strong advocate of birth control asked to speak on radio. The people at the station were nervous about what she might say, but when she assured them that she only wanted to recite some nursery rhymes, they allowed her into the studio. She then broadcast, "There was an old woman who lived in a shoe/She had so many children because she didn't know what to do." She was not invited back.

A Chicago man wanted to discuss Americanism over a Chicago station and even submitted a script ahead of time. He appeared at the station with a group of bodyguards who assured no buttons were pushed to take him off the air. It turned out that he was a potentate of the Ku Klux Klan, and, digressing from the script, he extolled the virtues of white supremacy.

A young man in New Jersey wanted to let his mother know how he sounded over the air, so he dropped in at WOR, which had just opened a studio near the music department of a store. The singer the studio was expecting had not arrived, so this young man was put on the air before he even had time to notify his mother. He sang to piano accompaniment for over an hour as a messenger rushed sheet music from the music counter to the studio.

The primary programming of the era was dubbed potted palm music—the kind played at teatime by hotel orchestras usually flanked by potted palms. Sometimes a vocalist was featured and sometimes a pianist or small instrumental group played. Sopranos outnumbered all other "potted palm" performers. Often the performers who "appeared" on radio wore tuxedos or evening gowns.

Drama was also attempted, even though engineers at first insisted that men and women needed to use separate microphones placed some distance from each other. Performers found it difficult to play love scenes this way. Finally it was discovered that men and women could share a microphone.

Religious broadcasts were part of early radio. Evangelist Aimee Semple McPherson operated a station in Los Angeles that frequently wandered off frequency. When the secretary of commerce threatened to shut down her station, she wired back, "Please order your minions of Satan to leave my station alone. You cannot expect the Almighty to abide by your wavelength nonsense.

From time to time radio excelled in the public-affairs area, broadcasting political conventions and presidential speeches. When the 6-year-old son of Ernst F. W. Alexanderson, the builder of the alternator, was kidnapped, a radio report of the child's description was responsible for his recovery.

The rise of advertising

As the novelty of radio wore off, people were less eager to perform, and some means had to be found for financing programming. Many ideas were proposed, including donations from citizens, tax levies on radio sets, and payment from radio set manufacturers. Commercials evolved largely by accident.t

AT&T was involved mainly in the telephone business and, although it was a partner with RCA, was reluctant to see radio grow because such growth might diminish the demand for wired services. One of its broadcasting entries was closely akin to phone philosophy. It established station WEAF in New York as what it termed a toll station. AT&T stated it would provide no programming, but anyone who wished to broadcast a message could pay a "toll" to AT&T and then air the message publicly in much the same way as private messages were communicated by dropping money in pay telephones. In fact, the original studio was about the size of a phone booth. The idea did not take hold. People willing to pay to broadcast messages did not materialize.

AT&T realized that before people would pay to be heard, they wanted to be sure that someone out there was listening. As a result, WEAF began broadcasting entertainment material, drawing mainly on amateur talent found among the employees. Still there were no long lines of people willing to pay to have messages broadcast.

 

Finally, on August 22, 1922, WEAF aired its first income-producing program—a 10-minute message from the Queensboro Corporation, a Long Island real estate company, which paid $50 for the time. The commercial was just a simple courtesy announcement because AT&T ruled out direct advertising as poor taste. Many people of the era said that advertising on radio would never sell products. Indeed, every dollar of income that WEAF obtained was a painful struggle.

Eventually, AT&T convinced the Department of Commerce that WEAF should have a different frequency. The argument was that other broadcasters were using stations for their own purposes, while WEAF was for everyone and therefore should have special standing and not be made to broadcast on 360 meters. As a result, WEAF and a few other stations were assigned to the 400-meter wavelength. This meant less interference and more broadcast time. The phone booth was abandoned, a new studio was erected, and showmanship took hold.

The formatting of networks

AT&T began using phone lines for remote broadcasts because it was still predominantly in the phone business. It aired descriptions of football games over its long-distance lines and established toll stations in other cities that it interconnected by phone lines—in effect, establishing a network.

During this time AT&T did not allow other radio stations to use phone lines and also claimed sole rights to sell radio toll time.

 At first, other stations were not bothered because they were not considering selling ads.

 In fact, there was an antiadvertising sentiment in the early 1920s. For example, people felt toothpaste should never be advertised because it was an intimate product.

As the AT&T toll network emerged and began to prosper, however, other stations became discontent with a second-class status. The fires of this flame were further fanned by a Federal Trade Commission inquiry that accused AT&T, RCA, GE, and Westinghouse of creating a monopoly in the radio business.

A series of closed hearings, held by the major radio companies, resulted in the 1926 formation of the National Broadcasting Company (NBC)—owned by RCA, GE, and Westinghouse. AT&T agreed to withdraw from radio programming in exchange for a long-term contract assuring that NBC would lease AT&T wires. This agreement earned the phone company millions of dollars per year. NBC also purchased WEAF from AT&T, thus embracing the concepts of both toll broadcasting and networking.

In November 1926, the NBC Red Network, which consisted of WEAF and a 23-station national hookup, was launched in a spectacular debut that aired a symphony orchestra from New York, a singer from Chicago, a comedian from Kansas City, and dance bands from various cities throughout the nation. A year later NBC's Blue Network was officially launched, consisting of different stations and different programming.

In 1932, GE and Westinghouse withdrew from RCA, largely because of the U.S. attorney general's order that the group should be dispersed and partly because David Sarnoff, now president of RCA, believed his company should be its own entity. Again a series of closed-door meetings resulted in a divorce settlement. RCA became the sole owner of NBC, and GE and Westinghouse received RCA bonds and some real estate. In retrospect, it appears that RCA walked off with the lion's share of value. But all this happened during the Depression, and GE and Westinghouse were not eager to keep what they thought might be an expensive broadcasting liability.

Both RCA and NBC have an interesting parentage. NBC was originally owned by RCA, GE, and Westinghouse, which ousted AT&T in forming NBC. RCA was formed by GE, Westinghouse, and AT&T, which ousted Marconi during RCA's formation. The exact details of all these corporate maneuvers will probably never be known.

What eventually became the Columbia Broadcasting System (CBS) was founded in 1927 by a man who wanted to supply radio talent to stations. His plans did not work out, and his failing company was bought by the family of William S. Paley (see Exhibit 1.7). Paley became president and built a radio network that was similar in organization to NBC in that it consisted of a chain of stations. The network became successful, and during the 1930s and 1940s, Paley lured much of the top radio talent, including Jack Benny, from NBC to CBS.

The American Broadcasting Company (ABC) came to the fore because of Federal Communications Commission (FCC) actions in the early 1940s. By 1940 the networks had established a power base that the FCC thought could be detrimental, so it attempted to limit their power by issuing rules that prohibited one company from owning and operating more than one national radio network. In 1943, NBC sold its Blue Network to a group of investors who, in 1945, changed the network's name to the American Broadcasting Company.

A fourth radio network, Mutual Broadcasting Company, was formed in 1934 when four stations decided to work jointly to obtain advertising. Unlike the other networks, Mutual owned no stations. Instead, it sold ads and bought programs. Then it paid the stations in its network to carry the programs and the network ads. It also allowed stations to sell their own ads.

Mutual, too, was involved with FCC regulations. NBC and CBS affiliate contracts stipulated that the local stations could not carry programs from a different network. In 1938, Mutual gained exclusive rights to broadcast the World Series, but the NBC and CBS contracts would not allow their affiliated stations to carry these games, even in cities where there were no Mutual stations. The people wanted the games, the stations wanted to carry them, and advertisers wanted to pay for the coverage. Many Americans, nevertheless, did not hear the 1938 World Series. The FCC determined that this type of program thwarting was net in the public interest. It stated that no station could have an arrangement with a network that hindered that station from broadcasting programs of another network.

Chaos and government action

The problem of broadcast frequency overcrowding continued to grow during the1920s. Secretary of Commerce Herbert Hoover was besieged with requests that the broadcast frequencies be expanded and that stations be allowed to leave the360-meter frequency band on which most of them were broadcasting. Hoover   radio made various attempts to improve the situation by altering station power and broadcast times, and he called four national radio conferences to discuss problems and solutions to the radio situation, but he was unable to deal with the problem in any systematic manner because he could not persuade Congress to give him the power to do so.

One ramification of the frequency situation was that commercial stations overpowered educational radio stations. In the early 1920s, educational and commercial stations often alternated hours on a shared frequency. If the stations commercial station decided it wanted a larger share of the time, it would petition the government and usually win because it could afford an expensive, time-consuming hearing in Washington while the educators could not. In addition, Hoover urged people who wished to enter broadcasting to buy an existing station rather than add one to the already overcrowded airwaves. As a result, many educational facilities were propositioned by commercial ventures and sold out.

By 1925, even though additional frequencies had been assigned to radio, the interference problem was so widespread that the only remedy would have been to reassign frequencies being used for other purposes. Under the existing law, however, the secretary of commerce was powerless to act. Hoover threw up his hands and told radio station operators to regulate themselves as best they could.

During 1926-27, 200 stations were created, most of them using any frequency or power they wished and changing at whim. Chaos reigned on the airwaves. To help remedy this situation, Congress passed the Radio Act of   1927. The act proclaimed that radio waves belonged to the people and could be   used by individuals only if they had a license and were broadcasting in the "public convenience, interest, or necessity.

All previous licenses were revoked, and applicants were allowed 60 days to apply for new licenses from the newly created Federal Radio Commission (FRC). The commission gave temporary licenses while it worked out the jigsaw puzzle of which frequencies should be used for what purposes. It granted 620 licenses in what is now the amplitude modulation (AM) band. The FRC also designated the power at which each station could broadcast.

Several years later Congress passed the Communications Act of 1934, which created the Federal Communications Commission. This act was passed primarily because both Congress and the president felt all regulation of communications should rest with one body. The FCC was given power over not just radio but also over telephone and other forms of wired and wireless communications. As the act was being formulated, educators lobbied for 15 percent of the frequencies to be reserved for educational radio; however, they were unsuccessful in their bid, and today there are few if any educational stations left in the AM band.

  

The golden era of radio

                

With the chaotic frequency situation under control, radio was now ready to enter the era of truly significant programming development—a heyday that lasted some 20 years.

Improvements in radio equipment helped earphones that only one person could use had already been replaced by loudspeakers so that the whole family could listen simultaneously.

The early carbon microphones were replaced by ribbon microphones, which had greater fidelity. Battery sets were introduced for portability and use in automobiles. (The first portables, however, were cumbersome because of the size of early dry batteries.)

Radio became the primary entertainment medium during the Depression. Is 1930, 12 million homes were equipped with radio receivers, but by 1940 this number had jumped to 30 million. During the same period, advertising revenue rose from $40 million to $155 million. In 1930, NBC Red, NBC Blue, and CBS offered approximately 60 combined hours of sponsored programs a week. By 1940, the four networks (Mutual had been added) carried 156 hours.

The first program to generate nationwide enthusiasm was Amos 'n' Andy. It was created by Freeman Fisher Gosden and Charles J. Correll, who met while working for a company that staged local vaudeville-type shows. Gosden and Correll, who were white, worked up a blackface act for the company and later tried it on WGN radio in Chicago as Sam Henry. When WGN did not renew their contract, they took the show to WMAQ in Chicago and changed the name to Amos V Andy because WGN owned the title Sam 'n' Henry.

Correll and Gosden wrote all the material themselves and played most of the characters by changing the pitch, volume, and tone of their voices. Gosden always played Amos, a simple, hardworking fellow, and Correll played Andy, a clever, conniving, and somewhat lazy individual who usually took credit for Amos's ideas.

 According to the scripts, Amos and Andy had come from Atlanta to Chicago to seek their fortune, but all they had amassed was a broken-down automobile, known as the Fresh-Air Taxicab Company of America.

Much of the show's humor revolved around a fraternity-type organization called the Mystic Knights of the Sea headed by a character called Kingfish, who was played by Gosden.

WMAQ allowed Correll and Gosden to syndicate the show on other stations. Its success caught the attention of the NBC Blue Network, which hired the two in 1929. Their program, which aired from 7:00 to 7:15 P.M. Eastern time, became such u nationwide hit that it affected dinner hours, plant closing times, and even, on one occasion, the speaking schedule of the president of the United States.

Many other comedians followed in the wake of the success of Correll and Gosden—Jack Benny, Lum and Abner, George Burns and Gracie Allen, Edgar Bergen and Charlie McCarthy, and Fibber McGee and Molly.

Music, especially classical music, was also frequently aired. Broadcasts featured New York Philharmonic concerts and performances from the Metropolitan Opera House. NBC established its own orchestra led by Arturo Toscanini. Your Hit Parade, which featured the top-selling songs of the week, was introduced in 1935, and people who later became well-known singers, such as Kate Smith and Bing Crosby, took to the air. The big bands of the 1940s could also be heard over the airwaves.

              One program innovation was to involve the audience.

               Among many amateur hours, perhaps the most famous was the one hosted by Major Edward Bowes. Quiz shows, such as Professor Quiz, rewarded people for responding with little-known facts. Stunt shows, such as Truth or Consequences, which prompted people to undertake silly assignments if they answered questions incorrectly, attracted large and faithful audiences.

                      Many programs were developed for children, including Let's Pretend, a multisegment program that emphasized creative fantasy; The Lone Ranger, a western; Quiz Kids, a panel of precocious children who answered questions; and Little Orphan Annie, a drama about a child's trials and tribulations.

  During the day, many stations broadcast continuing dramas. These programs, called              soap operas because soap manufacturers were frequent sponsors, always ended with an unresolved situation to entice the listener to tune in tomorrow." Most did. The scripts for a major portion of the soap operas were developed by a husband-wife team, Frank and Ann Hummert. They defined the basic idea for each series, wrote synopses of programs, and then farmed the actual script writing to a bevy of writers around the country, some of whom they never even met. 

In the area of drama, the networks first tried to rebroadcast the sound of Broadway plays but discovered that this was akin to sitting in a theater blindfolded. So the networks hired writers such as Norman Corwin, Maxwell Anderson, and Stephen Vincent Benet to script original dramas for radio.

 These dramas usually used many sound effects and were sponsored by one company that often incorporated its name into the program, such as Lux Radio Theater or Collier's Hour. In 1938, Orson Welles produced The War of the Worlds, a fantasy about a Martian invasion in New Jersey. Upon hearing the broadcast, an estimated 1.2 million people succumbed to hysteria. They panicked in the streets, fled to the country, and seized arms to prepare to fight—despite the fact that the Mercury Theater program included interruptions to inform the listeners that the presentation was only a drama.

The Depression spurred the growth of commercials. During the 1920s, advertisements were brief and tasteful, and price was not mentioned. As radio stations and all facets of the American economy began digging for money in any way they could, the commercial standards dissolved. Some advertisers believed commercials should irritate, and broadcasters, anxious for the buck, acquiesced. The commercials became long, loud, dramatic, hard-driving, and cutthroat.

Most radio programs were produced not by the networks but by advertising agencies. These agencies found that personal help programs could effectively promote products. Listeners would send letters to radio human relations "experts" detailing traumas, crimes, and transgressions and asking for help. Product box tops accompanying a letter qualified it for an answer; or the suggested solution might involve the sponsor's drug product or the contentment derived from puffing on the sponsor's brand of cigarette. By 1932, more airtime was spent on commercials than on news, education, and religion combined. The commercials brought in profits for NBC, CBS, and some individual radio stations. They also brought profits to the advertising agencies that were intimately involved in most details of programming, including selecting program ideas, overseeing scripts, selling and producing advertisements for the shows, and placing the programs on the network schedule.

There were also many events that could be termed stunt broadcasts, such as those from widely separated points, gliders, and underwater locations. A four-way conversation involved participants in Chicago, in New York, in Washington, and in a balloon. One music program featured a singer in New York accompanied by an orchestra in Buenos Aires.

These stunt broadcasts paved the way for the broadcasting of legitimate public events from distant points. In 1931, 19 locations around the world participated in a program dedicated to Marconi.

 People heard the farewell address of King Edward VIII when he abdicated the British throne and the trial of the man who kidnapped aviator Charles Lindbergh's baby.

Radio also figured in politics of the day. President Franklin Delano Roosevelt effectively used radio for his fireside chats to reassure the nation during the Depression. Louisiana's firebrand Governor Huey Long was often heard on the airwaves, and Father Charles E. Coughlin, a Detroit priest, tried to build a political movement through radio.

The press-radio war

News was destined to become one of radio's strongest services, but not without a struggle. At first, announcers merely read newspaper headlines over the air but gradually networks began purchasing news from the wire services. In 1932 the Associated Press sold presidential election bulletins to the networks, and programs were interrupted with news flashes. Newspapers objected to this on the grounds that news on radio would diminish the sale of papers. From 1933 to1935, a press-radio war ensued.

            A meeting of newspaper publishers, network executives, and wire service representatives, held at the Biltmore Hotel in New York in 1933, established the Biltmore Agreement It stipulated that networks could air two five-minute newscasts a day consisting of material received from the established wire services. These newscasts had to be aired in the morning after 9:30 A.M. and in the evening after 9:00 P.M. SO they would not compete with the primary hours of newspaper sales. No "hot-off-the-wire" news was to be broadcast, and newscasts were not to have advertising support because this might detract from newspaper advertising.

 Newspaper publishers ensured that these provisions appeared in the Biltmore Agreement because they were the most numerous, most powerful, and wealthiest of the meeting participants.

But the ink on this agreement was barely dry when its intent began to be subverted. The newspaper publishers had agreed to allow radio stations and networks to have commentators. Radio took advantage of this provision, and often these commentators became thinly disguised news reporters.

NBC and CBS began their own news-gathering activities. At NBC, one person gathered news simply by making telephone calls. Sometimes he scooped newspaper reporters because almost anyone would answer a call from NBC. In addition, he could reward news sources with highly prized tickets to NBC's top shows. Most of the material he collected was broadcast by NBC's prime newscaster, Lowell Thomas. CBS set up a larger news force that included stringers-reporters paid only for material actually used. That network's top news commentator was H. V. Kaltenborn.

The public became increasingly aware of news as world tensions grew. Advertisers became interested in sponsoring news radio programs because of the growing potential listener market. At one point, two services agreed to make their news available to advertisers, which would then broadcast it over radio, but they would not make it available to radio stations directly. This arrangement led to a breakdown of broadcast news blackouts, and radio began to develop as an important news disseminator. Americans heard actual sounds of Germany's march into Austria and the voices of Adolf Hitler and Benito Mussolini.

 

 

Word war II

The public became increasingly aware of news as world tensions grew. Advertisers became interested in sponsoring news radio programs because of the growing potential listener market. At one point, two services agreed to make their news available to advertisers, which would then broadcast it over radio, but they would not make it available to radio stations directly. This arrangement led to a breakdown of broadcast news blackouts, and radio began to develop as an important news disseminator. Americans heard actual sounds of Germany's march into Austria and the voices of Adolf Hitler and Benito Mussolini.

The government did not take over broadcasting during the 1940-45 World War II period as it had during World War I. It did, however, solicit radio's cooperation for bond purchase appeals, conservation campaigns, and civil defense instructions. Among the most famous of these solicitations were singer Kate Smith's marathon broadcasts for war bonds. Her appeals sold over $100 million worth of bonds. Many of the plays and soap operas produced during the period dealt with the war effort, and some even tried to address segregation, which was an issue because of racial separation in the armed forces. Several soap operas presented African Americans in esteemed professional roles.

The news function greatly increased as up-to-date material was broadcast at least every hour. One of the best-known voices heard from overseas was that of Edward R. Murrow whose broadcasts from London detailed what was happening to the English during the war.

One result of the war was the perfection of audiotape recorders. Events could now be recorded and played back whenever desired. Before the war, NBC and CBS policies forbid the use of recorded material for anything, other than sound effects, and even most of those were performed live. This policy was abetted by the musicians' union, which insisted that all broadcast music utilize musicians rather than phonograph records.

The recording technique used before the audiotape recorder usually employed phonograph discs, for the only magnetic recording known in America before World War II was wire recording. To edit or splice, a knot had to be tied in the wire and then fused with heat, making it a cumbersome technique. During the war, American troops entering German radio stations found them operating without any people. The broadcasting was handled by a machine that used plastic tape of higher fidelity than Americans had ever heard from wire. This plastic tape could be cut with scissors and spliced with adhesive. The recorders were confiscated, sent to America, and improved, and they eventually revolutionized programming procedures.

 Radio stations enjoyed great economic prosperity during the war. About 950 stations were on the air when the war began. No more were licensed during the war, so these 950 received all the advertisements. A newsprint shortage reduced ad space in newspapers, and some of that advertising money was channeled into broadcasting. Institutional advertising became common because of high wartime taxes; companies preferred to pay for advertising rather than turn money over to the government. Thus, radio station revenue increased from $155 million in 1940to $310 million in 1945.

Postwar Radio

Postwar radio prospered. Advertisers were standing in line, and the main programming problem was finding a way to squeeze in the commercials. To the networks, especially NBC, this boon provided the necessary capital to support the then-unprofitable television development. To invest even more in the new technology, nonsponsored public-affairs radio programs dropped by the wayside, as did some expensive entertainment. Radio fed the mouth that bit it.

On the local level, this prosperity created a demand for new radio station licenses as both entrepreneurs and large companies scrambled to cash in on the boom. The 950 wartime stations expanded rapidly to more than 2,000 by 1950. Advertising revenues increased from S310 million in 1945 to $454 million in 1950

The bubble burst, however, as advertisers' deserted radio to try TV, the medium that featured both sound and sight. This left radio networks as hollow shells. The 2,000 local stations found that the advertising dollars remaining in radio did not stretch to keep them all in the black. In 1961, almost 40 percent of radio stations lost money.

After the war, radio networks returned to prewar programming—comedy, drama, soap operas, children's programs, and news. However, a new phenomenon appeared on the scene—the disc jockey (DJ). Several conditions precipitated this emergence. A court decision in 1940 ruled that if broadcasters purchased a record, they could then play it. Previously, records had been stamped "not licensed for radio broadcast." Removing this restriction added legal stature to disc jockey programs. During the mid-1940s, the musicians' union, which had previously voted to halt recording, was appeased with a musicians' welfare fund to which record companies would contribute. This opened the door to mass record production. This mass production of records led to a symbiotic relationship between radio and the record business that is still in force today.

The beginnings of this relationship can be traced to several people, most notably Alan Freed, Gordon McLendon, and Todd Storz.

 During the early 1950s, Freed, a Cleveland DJ, began playing a new form of music he called rock and roll.

The music caught the fancy of teenagers and gave radio a new primary audience and a new role in society—a mouthpiece and sounding board for youth. McLendon and Storz were both station owners who began programming Top 40 music. According to radio lore, Storz was in a bar one night trying to drown his sorrows over the sinking income of his radio stations when he noticed that the same tunes seemed to be played over and over on the jukebox. After almost everyone had left, a waitress went over to the jukebox. Rather than playing something that had not been heard all evening, she inserted her nickel and played the same song that had been selected most often. Storz decided to try playing the same songs over and over on his radio stations.  Top 40 radio was born. McLendon programmed the same Top 40 format and promoted it heavily.

At the same time that recorded music was being introduced on radio, radios were becoming more portable, and Americans were becoming more mobile. The public (especially the young) appreciated the DJ shows, which could be enjoyed while listeners were engaged in other activities, such as studying, going to the beach, or talking with friends.

Another important reason for the rise of the DJ was that station management appreciated the lower overhead, fewer headaches, and higher profits associated with DJ programming.

 A DJ did not need a writer, a bevy of actors, a sound effects person, an audience, or even a studio. All that was needed were records, and these were readily available from companies that would eagerly court DJs in the hope that they would plug certain tunes, thus assuring sales of the records.

This courtship slightly tarnished the DJs' image during the late 1950s when it was discovered that a number of DJs were engaged in payola, accepting money or gifts in exchange for favoring certain records. To remedy the situation, Congress amended the Communications Act so that if station employees received money from individuals other than their employers for airing records, they had to disclose that before broadcast time under penalty of fine or imprisonment. This helped control the practice of payola, but every now and then it still rears its head.

The stations' need for the networks declined as the stations courted the DJs, and top talent left radio for TV. The increasing number of stations also meant that more stations existed in each city, so more of them were programming independently of networks. Therefore, the percentage of network-affiliated stations decreased dramatically. The overall result was a slow but steady erosion of network entertainment programming.

 FM Radio development

During the early 1930s, David Sarnoff mentioned to Edwin H. Armstrong that someone should invent a black box to eliminate static. Armstrong did not invent just a black box, but a whole new system—frequency modulation (FM). He wanted RCA to back its development and promotion, but Sarnoff had committed RCA funds to television and was not interested in underwriting a new radio structure despite its obviously superior fidelity.

Armstrong continued his interest in FM, built an experimental 50,000-watt FM station in New Jersey, and solicited the support and enthusiasm of GE for his project. During the late 1930s and early 1940s, an FM bandwagon was rolling, and some 150 applications for FM stations were submitted to the FCC. The FCC altered Channel 1 on the TV band and awarded spectrum space to FM. It also ruled that TV sound should be frequency modulated. Armstrong's triumphant boom seemed just around the comer, but World War II intervened and commercial FM had to wait.

After the war, the FCC reviewed spectrum space and decided to move FM to another part of the broadcast spectrum, ostensibly because it thought sunspots might interfere with FM. Armstrong protested this move because it rendered all prewar FM sets worthless and saddled the FM business with heavy conversion costs.

Armstrong was further infuriated because, although FM sound was to be used for TV, RCA had never paid him royalties for the sets it manufactured. In 1948, he sued RCA. The suit proceeded for more than a year, and the harassment and illness it caused Armstrong led him to leap from the window of his 13th-floor apartment to his death.

FM continued to develop slowly. With television on the horizon, there was little interest in "a new radio system. Many of the major AM stations acquired FM licenses as insurance in case FM replaced AM, as its proponents were predicting. AM stations simply duplicated their AM programming on FM, which did not increase the public's incentive to purchase FM sets. In fact, for a while an industry joke ran, "What do the letters 'FM' in FM radio stand for?" The answer was ''Find me".

One brighter spot was on the education front. In 1945, educators convinced the FCC to reserve the 20 FM channels between 88.1 and 91.9 exclusively for noncommercial radio. Most of these stations were used by universities, although some were owned by nonprofit community groups, such as the Pacifica Foundation, and others were operated by religious organizations. Six of these noncommercial stations were on the air by the end of 1948, and by 1950 there were 48. In 1949, the National Association of Educational Broadcasters (NAEB) formed a bicycle network to provide programming for educational stations. The programs were duplicated at a central location and then sent by mail from one station to another on a scheduled round-robin basis.

As general interest in high-fidelity music grew, FM's interference-free signal became an asset to commercial stations. In 1961, the FCC authorized stereophonic sound transmission for FM, which led to increased awareness of the medium. At first classical music dominated the FM airwaves. Hi-fi equipment then became inexpensive enough to be purchased by teenagers, and rock music became prominent FM fare. This led to an increased number of listeners, followed by an increased number of advertisers.

A further aid to FM's success was a 1965 FCC ruling stating that in cities of more than 100,000 populations, AM and FM stations with the same ownership had to have separate programming at least 50 percent of the time. This helped FM gain a foothold because it now developed its own distinctive programming. In 1986, when it was obvious FM had become established, the FCC rescinded the 1965 ruling and again allowed AM and FM stations to have the same programming.

During the 1970s, FM developed so successfully that it began taking audience away from AM. In 1972, AM had 75 percent of the audience, and FM had a paltry 25 percent. By the mid-1980s, those percentages had reversed, and AM stations were the ones losing money.

The switch to FM was mostly caused by the superior sound quality of the medium, including the capability for stereo sound. AM proponents tried to combat this by developing an AM stereo system. During the late 1970s and early 1980s, several companies proposed stereo transmission systems that, unfortunately, were not compatible with each other. AM stations hoped the FCC would choose a standard, as it had for FM, but in 1982, the FCC refused to rule on one common standard, stating instead that the marketplace should decide. The marketplace was not quick to decide. By the 1990s, the C-Quam system developed by Motorola seemed to have become the de facto standard, so the FCC rubber-stamped it, but very few stations switched to stereo. AM stereo sound is not as good as FM and did not give AM a competitive boost.

The Restructuring of public radio

The educational stations at the lower end of the FM dial received some sprucing up with the passage of the Public Broadcasting Act in 1967. This act was adopted mainly to benefit educational television, but radio was also included. The term "educational" was dropped and "public radio" was used instead. The act resulted in funding for a network, National Public Radio (NPR) that began operating from Washington, D.C., in 1970….. It replaced the bicycle network of the NAEB and today delivers programming by satellite. NPR's mission was to NPR upgrade the quality of public radio programming with news, Senate hearings, music, talk shows, documentaries, and programming from other countries. One of the most popular early programs was the in-depth evening news program All Things Considered, which is still on the air.

Over the years, some structural elements of NPR were not popular with many of the stations, most notably the fact that most of the programming was produced in Washington, D.C. Local stations thought their programs deserved wider dissemination. A group of public stations in 1982 formed American Public Radio, which in 1994 changed its-name to Public Radio International (PRI). PRI is an independent, nonprofit network headquartered in Minneapolis, PRI Minnesota.

 Unlike NPR, PRI does not receive direct federal funding. Station members pay fees that support the national office and the satellite distribution system. Most programs are donated by local stations and can be aired free by the affiliates. A popular personality on PRI is Garrison Keillor, with his weekly-program A Prairie Home Companion. Keillor's programs consist of a combination of music, skits, and homespun philosophy.

The public broadcasting networks do not fill all the airtime on the 750+ public radio stations that affiliate with them. Local programming includes music—classical, jazz, swing, and other forms not generally heard on commercial radio. Some stations also produce their own public-affairs programs, dramas, and children's programs.

College Radio

A number of colleges and universities own NPR- and/or PRI-affiliated stations that program primarily network material and operate much like public radio stations owned by community groups in that they have a paid staff and no involvement from the student body. Other colleges affiliate with NPR and PRI but allow for some student involvement, such as airing programs produced by students in radio production classes or offering student internships.

However, what the term "college radio" usually conjures up is an independently operated radio station owned by the college but operated by students as both a learning experience and a form of expression.

 In addition to the college stations, more than 300 high school stations operate in this manner. Many of these high school stations offer computer-programmed music during school hours and live DJ programming after school. These student stations, like the NPR-PRI stations, are located at the lower end of the FM band. They originally arose because of a 1948 FCC ruling authorizing low-powered, 10-watt educational stations that generally reached only a 2- to 5-mile radius and were inexpensive to operate. These 10-watter college and high school radio stations grew rapidly, and most have since increased their power. The student-run stations are important to musicians because they are the main outlet for alternative music and are often the first to air new groups and new sounds.

In addition to FM stations, some colleges and high schools have closed-circuit stations that operate only on campus, programming primarily to the cafeteria or the dorms. Others operate low-power AM stations that are designated to provide traffic and weather information. The student groups supplement this programming material with announcements about campus events. Many colleges have placed their FM stations on the internet, and a number have established internet-only student stations.

The changing structure of commercial radio                                             On the commercial front, the business structure of radio underwent a number of significant changes in the latter part of the 20th century. Radio networks, which hit a low in the 1960s, began to reemerge, but in a different form. They no longer brought common programming to the nation but instead developed numerous satellite services with different features and formats, each intended for a relatively small number of stations. Some of the stations used only bits and pieces from the network, some used the network music along with local personalities, and others used a preponderance of the network material—often obtaining it from several different networks. Obviously the old rules against one company owning more than one network were dropped.

Network ownership also changed. A new radio network, Westwood One, purchased Mutual in 1985 and NBC radio networks in 1987. In 1995, Disney bought ABC, changing the ownership of that network. CBS was purchased by Westinghouse in 1995 and then merged with Viacom in 1999. More than 500 companies now distribute radio programming, primarily over satellite. Some call themselves networks and others call themselves syndicators or program producers. The large players—Disney/ABC, CBS/Viacom, and Westwood One-deliver the most programming and take in the most revenue.

Another big change in the structure of the radio business involved deregulation, particularly that encompassed in the Telecommunications Act of 1996 that greatly relaxed station licensing procedures and ownership restrictions, license renewal, which used to be a very complicated procedure occurring every three years, is now a simplified process that only occurs every eight years. In previous decades, a particular company could own no more than seven AM and seven FM stations and could have no more than one of each in any listening area, now there are no national ownership limits, and local ownership limits have been changed so that, in some markets, one company can own eight stations. This deregulation has resulted in companies with large financial resources buying many radio stations. For example, Clear Channel Communication, which in 1995 owned only 45 stations, now owns in excess of 1,200.

However, there have also been a growing number of stations. In 1994 there added stations were about 11,700 radio stations nationwide and 10 years later there were 13,400. The increase is due mainly to technical improvements that allow more stations to be placed in the radio spectrum without interference. For example, a new type of station, low-power FM (LPFM), allows for additional stations in the FM band—stations with signals that will only reach a radius of several miles. About 1,000 applications were granted between 2000 and 2002, and about 300 of those stations are on the air. More stations may be authorized in the near future.

Another related result of deregulation is that companies can operate multiple stations, even if they do not own them, in the same area with the same sales and management team, a process referred to as a local management agreement (LMA). The formats of the stations are usually different, but one person acts as general manager of all of them, and the salespeople sell ads for all of them. The stations are often located in the same building. All of this cuts down on overhead, thus increasing profit.

            Another recent phenomenon is the growth of ethnic radio. Foreign-language stations existed near the periphery of radio for many years, but by the mid-1990s, more than 400 stations were operating with an ethnic format. In Los Angeles, for example, several Spanish-language stations have been rated number one during different rating periods. Consolidation is evident in ethnic radio, too.

The largest Spanish-language radio group, Hispanic Broadcasting, merged with the Spanish-language TV company, Univision.

 Talk radio is now center stage. Conservative hosts such as Rush Limbaugh and G. Gordon Liddy have developed large followings. "Shock jocks" such as Howard Stern and Don Imus have stirred controversy with their sexual and scatological language and their often outlandish antics on and off the radio. But the personality who is heard on the most radio stations is an old-timer, Paul Harvey, who has his own brand of news and commentary for ABC and who started his radio career in 1933.

Digital radio

The newest element on the radio scene is digital radio, present in various forms. One is satellite radio, also known as digital audio radio service (DARS) and audio broadcasting (DAB). Satellite radio started in 2001 when XM satellite Radio began broadcasting, and eight months later Sirius Satellite Radio dated a similar service. Both companies had received permission to develop their services in 1997 when they paid the FCC more than $80 million for the frequencies. Both also gained business partners among automobile manufacturers (GM and Honda for XM and Ford and DaimlerChrysler for Sirius).

The car companies are making satellite radio receivers an option for automobiles because satellite radio cannot be received on conventional radios, fact, XM and Sirius broadcast on different frequencies and with different encryption, making it difficult and expensive to design a radio to receive both, ach service offers more than 100 channels consisting of programming from established networks and programming specially developed by their companies, such of it advertising free. Because the programming comes from satellite, someone driving across the country can hear any channel continuously without it fading in and out. Satellite radio is consistently gaining listeners and may gain even more because Sirius has contracted with Howard Stern for him to switch from conventional radio to their satellite system.  

Conventional broadcasters are not standing idly by and allowing satellite io to steal the digital thunder. They have their own digital system referred to as high-definition (HD) radio or in-band on-channel (IBOC) radio. What this means is that the digital signals can be heard on the same radios and at the same dial position as conventional analog radio signals. Technology developed by Ubiquity squeezes the digital signal into the same frequencies that the station uses for AM or FM broadcasting. IBOC will allow for better reception, higher fidelity, the possibility to add services such as traffic information on demand, and the ability to pause and rewind music.

A third form of digital radio involves the internet. Some stations that currently broadcast over the airwaves also send their signals over the internet. In addition, there are many internet-only radio stations that undertake webcasting from anywhere in the world to anywhere in the world.

Issues and the future

The effect that new radio forms such as satellite radio, web radio, and LPFM will have on conventional radio has yet to be determined. Although satellite radio is in its infancy and has only a few million subscribers, it appears to be taking hold at a faster clip than CDs, VCRs, and cable TV did in their early days. Because it could drain listeners (and advertisers) away from conventional radio, station owners have consistently opposed it, but not particularly successfully. They were able to cut a deal that would ostensibly keep satellite radio from offering local programming, but XM has found a path around the agreement and is planning to air local weather and traffic in selected cities.

Not only can web-only radio draw listeners away from terrestrial radio, but downloading of music from the internet and playing it back on CDs or other digital equipment can take away from the time that people might otherwise spend with radio.

Conventional broadcasters have been steadfast in their opposition to LPFM, using interference as their main weapon. At one point they succeeded in having the number of low-power licenses cut down from the number proposed, but the FCC has undertaken a new interference study and may end up allocating several hundred more permits. More stations on the air, even low-power ones, could mean less income for stations currently broadcasting.

Conversely, the establishment of more stations and more forms of radio broadcasting could be the answer to those who feel radio is too consolidated. Clear Channel has been accused of "stomping on the competition, destroying artistic integrity, and making mush out of the little guy."59 Yet, its defenders point out that it owns less than 10 percent of the radio stations and none of other forms of radio. If even more radio forms become prevalent, the big companies will become smaller players. In fact, the FCC's intent, when it opened up LPFM, was to make these stations available to community groups, schools, and churches so that they had access to the airwaves.

A totally different issue that radio must deal with involves indecency. The violent lyrics of music and the sexual chatter of DJs and talk-show hosts frequently raise the ire of the FCC, Congress, and some members of the public. Other members of the public tune in to listen to this, however, allowing the stations to charge high advertising rates because the ratings are high. Government agencies and citizens' groups want radio stations to air material that they feel people should have, but radio stations often respond that they are there to give audience members what they want. The whole subject of indecency and obscenity is a thorny subject that is covered more thoroughly in Chapters 10 and 11.

Radio's history is full of cataclysmic changes. Its resilience in reinventing itself during the 1960s could serve as a model as it marches forward in the 21st century.

Summary

Radio has survived periods of experimentation, glory, and trauma. Early inventors, such as Maxwell, Hertz, Marconi, Fleming, Fessenden, and De Forest, would not recognize radio in its present form. Many people who knew and loved radio during the 1930s and 1940s do not truly recognize it today. Radio has endured and along the way has chalked up an impressive list of great moments: picking up the Titanic's frantic distress calls, broadcasting the Harding-Cox presidential election returns, broadcasting the World War II newscasts of Edward R. Murrow, and sur­viving the television takeover.

Government interaction with radio illustrates the medium's growth as a broadcasting entity. Early laws dealt with radio primarily as a safety medium. The fact that government took control of radio during World War I but did not do so during World War II indicates that radio had grown from a private communi­cation medium to a very public one that most Americans relied on for informa­tion. The need for the government to step in to solve the problem of overcrowded airwaves during the late 1920s proved the popularity and prestige of radio. The ensuing Communications Act of 1934 and the various FCC regulations helped solidify the government's role in broadcasting. When Congress passed the Public Broadcasting Act of 1967, it set the groundwork for the reorganization of public radio. Government was involved in the development of FM and the initiation of ^LPFM and digital radio. The lessening of ownership regulations stipulated in the telecommunications Act of 1996 is further evidence that radio has survived.

Companies from the private-enterprise sector have also played significant les in the history of radio, starting with the Marconi Company and progressing through the founding of RCA by AT&T, GE, and Westinghouse. These early companies contributed a great deal in terms of technology, programming, and finance. The networks, each in its own peculiar way, set the scene for both healthy competition and elements of unhealthy intrigue. Intrigue also character­ized the rivalry between newspapers and radio in the pre-World War II days, and free enterprise in its purest sense altered the format of radio when television stole its listeners. The formation of new networks by Westwood One and the revitalization of networks and syndicators are further proof that radio has survived.

Radio programming is indebted to early pioneers who filled the airwaves with boxing matches, "potted palm" music, and call letters, and to Amos 'n' Andy, Jack Benny, and others who are remembered for creating the golden era of radio. Today countless DJs, talk-show hosts, and newscasters let us know that radio has survived.

 

 

 

 

Broadcast television TV

 

Over-the-air broadcast television has been prominent since the early 1950s. Although there are people still alive who can remember life before television, there are others who find it hard to fathom what life would be like without TV or even what it would be like with only three channels. Since its inception the medium has been a blur of technological change and programming turnover.

 Television had a negative impact on both radio and movies, but broadcast television in turn has had to learn to live with the challenges of cable TV, videocassettes, satellite TV, DVDs, and the internet.

 Some believe that the broadcast TV structure of a few networks and many stations is past its prime. Yet it still commands the largest audiences, albeit quite a bit eroded from its heyday.

Early experiments

The first experiments with television used a mechanical scanning process invented in Germany in 1884. This process depended on a wheel that contained tiny holes positioned spirally. A small picture could be placed behind the wheel. Each hole scanned one line of the picture as the wheel turned.

Even though this device could scan only very small pictures, attempts were made to develop it further. For example, at General Electric's New York plant, Ernst F. W. Alexanderson began experimental programming during the 1920s using a revolving scanning wheel and a 3-by-4-inch image. One of his "programs," a science fiction thriller of a missile attack on New York, scanned an aerial photograph of New York that moved closer and closer and then disappeared to the sound of an explosion.

Other people developed electronic scanning, the system that has since been adopted.

One developer was Philo T. Farnsworth, who in 1922 astounded his Idaho high school teacher with diagrams for an electronic TV system. He applied for a patent and found himself battling the giant of electronic TV development, RCA. In 1930 Farnsworth, at the age of 24, won his patent and later received royalties from RCA.

The RCA development was headed by Vladimir K. Zworykin who patented an electronic pickup tube called the iconoscope. Beginning in the early 1930s, he and other engineers (including Alexanderson) systematically attacked such problems as increased lines of scanning, definition, brightness, and image size. They started with a system that scanned 60 lines using a model of Felix the Cat (see Exhibit 2.4) as the star. Gradually they improved this scanning to 441 lines.

In 1939, David 'Sarnoff, then president of RCA and a strong advocate of , decided to display television at the New York World's Fair . President Franklin D. Roosevelt appeared on camera and was seen on sets with 5- or 7-inch tubes. RCA by this time had an experimental TV program schedule broadcast only in New York that consisted of one program a day from its studio, one from a mobile unit traveling the streets of New York, and several assorted films. The studio productions included plays, puppets, and household tips.

The mobile unit consisted of two huge buses, one jammed with equipment programming to be set up in the field and one containing a transmitter. It covered such events as baseball games, airport interviews with dignitaries, and the premiere of Gone with the Wind. The films were usually cartoons, travelogues, or government documentaries.

CBS began experimentation with color television, utilizing a mechanical color wheel of red, blue, and green that transferred color to the images. This color system was not compatible with the RCA-promoted system. In other words, the sets being manufactured could not receive either color or black-and-white pictures from the CBS mechanical system, and proposed CBS receivers would not be able to pick up existing black-and-white pictures. In 1940, a group led mainly by RCA personnel tried to persuade the FCC to allow the operation of the 441-line system. The FCC, however, was not certain this system had adequate technical quality, so it established an industry wide committee of engineers, the National Television System Committee (NTSC), to recommend standards. This committee rejected the 441-line system but in 1941 recommended the 525-line system that became the standard in the United States for many years.

Originally there were to be 13 very high frequency (VHF) channels, but Channel 1 was eliminated to allow spectrum space for FM radio.

 Twenty-three stations went on the air in 1941 and 1942, 10,000 sets were sold, and commercials were sought. The first commercial was bought by Bulova and consisted of a shot of a Bulova clock with an announcer intoning the time. All of this, however, stopped in 1942 because of World War II. During the war, only six stations remained on the air, and most sets became inoperable because spare parts were not being manufactured for civilian use.

 

The emergence of television

Television activities did not resume immediately after the war. The delay was partly due to a shortage of materials. Building a TV station was expensive, and the owners expected that they would operate at a loss until there were enough receivers in the area to make the station attractive to advertisers.

 In addition, CBS and RCA were feuding about color. CBS stated that its mechanical color system was so well developed that TV station allocations should not begin in earnest until the FCC resolved the color question. RCA promised black-and-white sets on the market by mid-1946 and a color system shortly thereafter that was electronic and compatible with its black-and-white sets. In 1947, the FCC declared that CBS's color system would be a hardship on set owners because they would have to buy new sets. It therefore stated that television should continue as a 525-line black-and-white system on Channels 2 to 13.

Television emerged as a mass medium in 1948. The number of stations, sets, and audiences all grew more than 4,000 percent within that one year. Advertisers became aware of the medium, and networks began more systematic programming.

Television networks had existed before 1948 as offshoots of the radio networks. As early as 1945, TV networks were organized by NBC, CBS, and ABC. A fourth network, DuMont (founded by Allen B. DuMont), existed for a short while. Most cities had only one or two TV stations, and NBC and CBS usually recruited them as affiliates, making it difficult for ABC and DuMont to compete. ABC survived because it merged in 1953 with United Paramount Theaters and thus gained an increase in operating funds. DuMont, however, went out of business in 1955.

The freeze

Television grew so uncontrollably that in the fall of 1948 the FCC imposed a freeze on television station authorizations because stations were beginning to interfere with one another. Remembering the days of radio chaos, the FCC wanted to nip the problem in the bud. The proposed six-month freeze lasted until July 1, 1952. During this period, 108 stations were on the air, and no more were authorized to begin operation. What occurred between 1948 and 1952could be termed an explosive lull. Many cities, including Austin, Texas; Denver, Colorado; and Portland, Oregon, had no television stations. Others had only one or two. New York and Los Angeles were the only cities to boast seven. Although TV networking still could not be considered truly national, the number of sets, audience size, advertising, and programming continued to grow. By 1952, 15million homes had sets, the largest of which had 20-inch tubes and sold for about$350. Television advertising revenues reached $324 million.

When the FCC ended the freeze in 1952, it established a station allocation system that assigned specific channels to specific areas of the country. Between 1948 and 1952, the FCC realized that the 12 VHF channels being used would not be sufficient to meet demand. The FCC engineers added 70 stations in the ultra-high frequency (UHF) band, for a total of 82 channels. UHF was at a much higher frequency than VHF, and very little was known about the technical characteristics of UHF at that time. The FCC engineers thought that by increasing the power and tower height of UHF stations, they would be equal in coverage to VHF stations.

In addition, the FCC, which by now had allocated FM radio stations for education noncommercial use, also decided to reserve 242 channels (80 VHF and 162 UHF) for educational television. Unlike FM, these channels were scattered around the dial. For example, Channel 13 was reserved in Pittsburgh, Channel 11 was reserved in Chicago, and Channel 28 was reserved in Los Angeles. Because demand was great, in 1966 the FCC increased this educational allocation to 604 channels.

The lift of the freeze led to an enormous rush to obtain stations. Within six months, 600 applications were received and 175 new stations were authorized. By 1954, 377 stations were broadcasting, and TV could be considered truly national.

          Early programming

During the 1948-49 season, 30 percent of sponsored evening programs were sports related. Wrestlers, both men and women, competed to outdo one another in costumes, hairdos, and mannerisms. The large number of TV sets in bars spurred the sports emphasis. During the 1949-50 season, however, sports comprised less than 5 percent of evening programming, and children's programming was tops, indicating that TV had moved to the home.

In TV cities, movie attendance, radio listening, sports event attendance, and restaurant dining were all down-especially on Tuesday night, which was Milton Berle night. People with TV sets stayed home and often invited their friends over (or allowed their friends to invite themselves over) to watch this ex-vaudevillian's show, which started in 1948 and included outrageous costumes, slapstick comedy, and a host of guest stars. "Uncle Miltie" on his Texaco Star Theater became a national phenomenon and was the reason many people bought their first television set.

The programming forms used by early TV were very similar to those used during the heyday of radio—comedy, drama, soap operas, public affairs, and children's programs. Some of them were reconstructed radio shows with radio stars such as Groucho Marx, Jack Benny, and ventriloquist Edgar Bergen (who didn't last long because people could see his lips move). When Amos V Andy was brought to TV, it featured black actors trained by Gosden and Correll. The program was condemned as an insult by the National Association for the Advancement of Colored People at its 1951 convention, much to the astonishment of the lily-white broadcasting fraternity.

In 1951, 1 Love Lucy began as a maverick of the TV world because it was filmed earlier, whereas other shows were aired live. There was a stigma against film at the time, partly because it added to the cost and partly because the TV networks inherited the live tradition from radio and assumed that all shows should be produced live. The film aspect was particularly useful and dramatic when Lucille Ball became pregnant, and the story line dealt with Lucy's pregnancy. The episode involving the birth of Lucy's baby was filmed ahead of time, and Lucille's real baby was born the same day the filmed episode aired-to an audience that comprised 68.8 percent of the American public. Eventually, the filming more than paid for itself because the program became the first international hit. Copies of the film were made, dubbed into numerous languages, and sold overseas.

Television newscasts of the 1950s developed slowly. Networks found it easy to obtain   news and voices, but pictures were another matter. At first they contracted with the companies that supplied the newsreels then shown in movie theaters. This did not exactly fit television's bill because much of it was shot for in-depth stories, not news of the day. Networks hired their own film crews, but limited budgets and bulky film equipment meant that camera operators could attend only planned events, such as press conferences and ribbon-cuttings. The 15-minute newscasts tended to be reports on events that were filmed earlier.

Interview-type news shows were a further development. Meet the Press (which is still on the air) began its long run of probing interviews with prominent people. See It Now started in 1951 as a news documentary series featuring Edward R. Murrow. A historical feature of the first program was showing for the first time both the Atlantic and Pacific Oceans live on TV.

At this point, television could be proud of its achievements. Sets had increased in size and quality, TV programming had increased in hours and variety, the public was fascinated with the new medium, and advertisers were ; increasingly strong financial backing.

Blacklisting

To this fledgling industry came some of the country's best-known talent. They came from radio, Broadway, and film—all of which were experiencing downturns as television was burgeoning. Unfortunately, some of these people became caught in the anti-Communist blacklisting mania of the 1950s led by Senator Joseph R. McCarthy. A 215-page publication called red Channels: The report of Communist Influence in Radio and Television gave information about 151 people, many of whom were among the top names in show business that suggested they had Communist ties. Some of these charges, such as associating people with "leftist" organizations to which they had never belonged, were proved to be "false. Other allegations were true, but were "leftist" only by definitions of the perpetrators of Red Channels. These included such "wrongdoings" as signing a cablegram of congratulations to the Moscow Art: on its 50th birthday.

 Although many network and advertising executives did not believe these were Communists or in any way un-American, they were unwilling to hire them, in part because of the controversy involved and in part because sponsors received phone calls that threatened to boycott their products if programs employed these people. Some well-established writers, for the better part of a decade, found that all the scripts they wrote were "not quite right," and certain actors were told they were "not exactly the type for the part." Many of these people did not even know they were on one of the "lists" because these were circulated clandestinely among executives.

In time, the blacklist situation eased. Ironically, broadcasting was influential in exposing the excesses of the Communist witch hunt, which had spread beyond the entertainment industry. Edward R. Murrow prepared several programs on Senator McCarthy, who had alarmed the country by saying that he had a list of hundreds of Communists in the State Department. The Murrow telecasts helped reveal this claim as false. In 1954, television covered hearings where McCarthy took on the army. As the nation watched, McCarthy and his aides harassed and bullied witnesses. Public resentment built against McCarthy, and the Senate voted 67 to 22 to censure him.

The live era

Programming of the 1950s was predominantly live. / Love Lucy continued to be filmed, and several other programs jumped on the film bandwagon as foreign countries began developing broadcasting systems. Americans could envision the reuse of their products in other countries and, hence, the possibility to recoup film costs. Reruns in the United States were as yet unthought-of , although some programs were kinescoped so they could be shown at various times. These kinescopes were low-quality, grainy-film representations of the video picture. Most of the popular series of the day, however, originated in New York and were telecast as they were being shot.

This live aspect created problems for drama writers, actors, and technicians. Costume changes needed to be essentially nonexistent. The number of story locales was governed by the number of sets that could fit into the studio. These sets were arranged in a circle on the periphery of the studio so the cameras could have easy access to each new scene. Timing was sometimes an immense problem. In radio, scripts could be quite accurately timed by the number of pages, but television programs contained much action, the time of which often fluctuated widely in rehearsals. One writing solution was to plan a search scene near the end of the play. The actor could find what he or she was looking for right away if the program was running long or could search the room for as long as necessary if the program appeared to be moving too quickly.

The programming of the early 1950s is often referred to as the "golden age of television." This is mainly because of the live dramas produced during this period. One of the most outstanding plays was Rod Serling's Requiem for a Heavyweight, the psychological study of a broken-down fighter.

 Another was Paddy Chayefsky's Marty, the heartwarming study of a short, stocky, small-town butcher who develops a sensitive romantic relationship with a homely schoolteacher.

In addition to conventional drama, innovative formats were tried, many of them the brainchild of Sylvester L. "Pat" Weaver, president of NBC from 1953 to 1955. One of his ideas was the spectacular, a show that was not part of the regular schedule but designed to expand the creative horizons. One outstanding spectacular was Peter Pan, which was viewed by some 165 million Americans.

Weaver was also involved in developing the Today and Tonight shows. Today was first hosted by Dave Garroway, who had a chimpanzee as a sidekick. Tonight originally starred Steve Allen and from 1962 to 1992 was hosted by Johnny Carson. When he retired, Jay Leno took over. Weaver felt that programs should be controlled by the network rather than advertising agencies. Most of the early TV and golden era radio program content was controlled by the advertising agencies Weaver developed a magazine concept whereby advertisers bought insertions in programs, and the program content was supervised and produced by the networks.

While commercial television began to prosper, educational television programming struggled during the early years. Although the FCC had reserved channels, activating the stations was difficult because of the huge sums of money needed. Those, organizations interested in establishing stations were not known for deep pockets-universities, school districts, state governments, nonprofit community organizations.

Fortunately, the Ford Foundation stepped in and provided money for facilities and programming. Two innovative programming concepts the Ford Foundation funded were the Chicago TV College and the Midwest Program on Airborne Television Instruction (MPATI). The Chicago project (see Exhibit 2.11) was a fully accredited set of televised courses that enabled students to earn two-year college degrees through a combination of at-home viewing and on-campus class attendance. MPATI used an airplane that circled two states to broadcast programs to schoolchildren. The Ford Foundation also helped establish a bicycle network system for distributing programming, the National Educational Television and Radio Center, which operated out of Ann Arbor, Michigan. This helped stations acquire programming, but because tapes were mailed to stations in a round-robin fashion, nothing timely could be exchanged. Despite this outside help, educational programming of the 1950s and 1960s was, in a word, "dull." It was produced on a shoestring budget and consisted primarily of talking heads discussing issues and information.

Color TV approval

Color TV underwent a number of changes and did not become widespread for several decades. CBS advocated a mechanical system that was not compatible with existing sets, and RCA favored an electronic compatible one. In 1950, the FCC accepted the CBS system, believing it provided higher quality color pictures. RCA, however, continued to fight the CBS system by refusing to program in color and by gaining allies among other set manufacturing companies and TV stations, Stations did not want to purchase CBS color cameras and other color gear because they could not simultaneously transmit with the present black-and-white system if they were to transmit with the CBS color system. This meant a station could not program to people with old sets and people with new color sets at the same time. CBS also ran into difficulty manufacturing its color sets because it needed materials that were in short supply due to the Korean War effort. The CBS color system project essentially came to a halt, and a general state of confusion concerning color reigned in the TV industry.

To help solve the problem, the National Television System Committee RCA system (NTSC), the same committee of engineers that decided on the 525-line system, volunteered to study the situation. Because this committee included more members who favored the RCA system than the CBS system, very few people were surprised when it recommended the compatible system. To its credit, however, the RCA system had been improved, in part due to suggestions from the NTSC. The FCC took the NTSC recommendation and in 1953 sanctioned RCA's electronic compatible system. At the time, even CBS supported the adoption.

For a long time, however, RCA-NBC was the only company actively promoting color. NBC constructed new color facilities and began programming in color, but both CBS and ABC dragged their heels, and most local stations did not have the capital needed to convert to color equipment. Consumers were reluctant to purchase color TV sets because they cost twice as much as black-and-white sets, and the limited color programming did not merit this investment. But as more color sets were sold, the prices fell and programming in color increased, causing even more sets to be sold. Not until the late 1960s were all networks and most stations producing color programs.

Prerecorded programming

The days of live programming, other than news and special events, began to disappear in the mid-1950s for several reasons. One was the introduction of videotape in 1956. The expense of the equipment prevented it from taking hold quickly, but once its foot was in the door, videotape revolutionized TV production. Programs could now be performed at convenient times for later airings. As the equipment became more sophisticated, a taping could be stopped for costume and scene changes. As the equipment became even more sophisticated, mistakes could be corrected through editing.

The live era, however, began to yield to film even before tape took hold. Film companies were originally antagonistic toward TV because it stole much of the audience that attended movie theaters. Some film production companies would not allow their stars to appear on TV and would not even allow TV sets to appear as props in movies….. The 1953 merger of United Paramount Theaters and ABC opened the door for Hollywood film companies and the New York TV establishment to begin a dialogue. The first result of this dialogue was a one-hour weekly series, Disneyland, produced for ABC by the Walt Disney Studios. This was a big hit, and soon several other major film companies were producing film series for TV.

Of the early filmed TV series, westerns predominated. By 1959, 32 western westerns series were on prime-time TV. The one with the greatest longevity was Gunsmoke, which revolved around Dodge City's Matt Dillon, Chester Goode, Doc and Miss Kitty. The TV boom continued in the late 1950s-more TV sets, more viewers, more stations, and more advertising dollars. To this rising euphoria came a dark hour.

The quiz scandals

Quiz programs on which contestants won minimal amounts of money or company-donated merchandise existed on both radio and television. In 1955, however, a new idea emerged in the form of The $64,000 Question. If contestants triumphed over challengers for a number of weeks, they could win huge cash prizes. Sales of Revlon products, the company that sponsored The $64,000 Question, zoomed to such heights that some were sold out nationwide. The sales success and high audience ratings spawned many imitators. Contestants locked in soundproof booths pondered, perspired, and caught the fancy of the nation.

From time to time, rumors circulated that some quiz programs were fixed. Then in 1958 a contestant from Twenty-One described situations that indicated the program was rigged. The networks and advertising agencies denied the charges, as did Charles Van Doren, a Columbia professor who was the most famous of the Twenty-One winners. A House of Representatives subcommittee conducted hearings, and in 1959 Van Doren testified. He read a long statement describing how he had been persuaded in the name of entertainment to accept help with answers in order to defeat a current champion who was becoming unpopular. Van Doren was also coached on methods of building suspense and when he did win, he became a national hero and a leader of intellectual life. He asked to be released from the show and finally was allowed to lose after months on the program. He initially lied, he said, so that he would not betray the people who had invested faith in him.

In retrospect the quiz scandals' negative effect on TV was short-lived. The medium was simply too pervasive a force to be permanently afflicted by such an incident. Congress did amend the Communications Act to make it unlawful to give help to a contestant, but for the most part the networks rectified the errors by canceling the quiz shows and reinstating a higher percentage of public-service programs.

Networks also took charge of their programming to a much greater extent. All three networks decreed that from then on most program content would be decided, controlled, and scheduled by networks, which would then sell time to advertisers. This was a further extension of Weaver's "magazine concept." Beginning in 1960, most program suppliers contracted with the networks rather than with advertising agencies. This made life more profitable for the TV networks, too, because they established profit participation plans with the suppliers.

The UHF problem

When the FCC ended its freeze and established stations in the UHF band, it intended that these stations would be equal with VHF stations. In reality, they became second-class stations. UHF's weaker signal was supposed to be compensated for by higher towers, but this did not work in practice.

People did not have sets that could receive UHF, so to tune in UHF stations they needed to buy converters. Many were unwilling to do this, and UHF found itself in a vicious circle. To persuade people to buy UHF converters, UHF had to offer interesting programming material; to finance interesting program material; UHF stations had to prove to advertisers that they had an adequate audience.

The FCC tried to help the fledgling UHF stations in several ways. In 1954, it changed the number of TV stations that one company could own from five to seven, provided that no more than five of those seven were VHF. This meant that organizations such as the three networks were free to buy two UHF stations each. NBC and CBS did and placed their network programs on them. The theory was that with network programming on UHF, people would be willing to buy conveners. But UHF penetration increased so slightly in the markets where NBC and CBS had their stations that both networks abandoned the UHF.

In 1957, the FCC proposed a procedure known as deintermixture. The intent was to make some markets all UHF and some all VHF so that in the all-UHF markets people would be forced to buy converters if they wanted to receive any television. This plan did not succeed either, mainly because established VHF stations fought efforts to convert them to UHF.

A third attempt to give UHF a boost was the 1962 passage of the all-channel receiver bill that gave the-FCC authority to require both a UHF and a VHF tuner on all TV sets. This helped UHF to some degree, but it was helped more, when cable TV was developed in the 1980s. UHF channels shown over cable have as strong a signal as VHF channels on the same cable system.

Reflections of upheaval

Television journalism gathered force and prestige during the 1960s-the decade of civil rights revolts, the election of John F. Kennedy, assassinations, the Vietnam War, and student unrest. The networks encouraged documentaries and increased their nightly news from 15 to 30 minutes in 1963, thereby assigning increased importance to their news departments. Anchoring on camera for NBC were Chet Huntley and David Brinkley, and CBS had Walter Cronkite, the person who became known as the most trusted man in America.

The quiz scandals had helped precipitate a rise in documentaries. To atone for their sins, networks increased their investigative fare. Documentaries were now easier to produce because technical advances allowed film and sound to be synchronized without an umbilical cord between two pieces of equipment, and wireless microphones enabled speakers to wander freely without having to stay within range of a mike cord. News-gathering flexibility became even greater when portable video cameras were developed at the end of the decade. Technological advances also made it possible for TV to show the 1969 moon landing, one of the most watched events ever.

ABC established Close-Up, and the other networks offered CBS Reports and NBC White Paper as ongoing documentaries. The notable documentaries of the era included Biography of a Bookie Joint, for which concealed cameras recorded the operation of a Boston "key shop," and The Tunnel, for which NBC secured footage of an actual tunnel being constructed by young Berliners to bring refugees from East to West Berlin.

Many documentaries reported on racial problems. Crisis: Behind a Presidential Commitment chronicled the events surrounding Governor George Wallace's attempted barring of the schoolhouse door to prevent blacks from attending the University of Alabama.; The Children Are Watching dealt with the feelings of a six-year-old black child attending the first integrated school in New Orleans.

Television reacted to the civil rights movement in another way too-it began hiring African Americans. Radio was also lily-white, but not so visibly. Both media began hiring African Americans in the 1960s, Scriptwriters began including stories about blacks, and Diahann Carroll in Julia became the first black TV heroine.

Television was credited, through the Great Debates between John F. Kennedy and Richard M. Nixon, with having a primary influence on the 1960 presidential election results. Kennedy and Nixon met for the first debate at the   studios of Chicago's CBS station. Kennedy, tanned from campaigning in California, refused the offer of makeup. Nixon, although he was recovering from a brief illness, did likewise. Some of Nixon's aides, concerned about how he looked on TV, applied Lazy-Shave, to create a clean-shaven look. Some people believe that Kennedy's apparent victory in the first debate had little to do with what he said. People who heard the program on radio felt Nixon held his own, but those watching TV could see a confident, attentive Kennedy and a haggard, weary-looking Nixon whose perspiration streaked the Lazy-Shave. Three more debates were held, and Nixon's makeup and demeanor were well handled, but the small margin of the Kennedy victory is often attributed to the undecided vote swung to Kennedy during the first debate.

Three years later, television devoted itself to the coverage of the assassination of John F. Kennedy. From Friday, November 22, to Monday, November 25, 1963, there were times when 90 percent of the I American people were watching television. One New York critic wrote, "This was not viewing. This was total involvement." From shortly after the shots were fired in Dallas until President Kennedy was laid to rest in Arlington Cemetery, television kept the vigil, including the first "live murder" ever seen on TV as Jack Ruby shot alleged assassin Lee Harvey Oswald. Many praised television for its controlled, almost flawless coverage. Some thought TV would have made it impossible for Lee Harvey Oswald to receive a fair trial and that it was the presence of the media that enabled the Oswald shooting to occur.

Television brought war to the American dinner table for the first time in history. The networks established correspondents in Saigon as the troop buildup began in Vietnam during the mid-1960s. Reports of the war appeared almost nightly on the evening news programs. In 1968, amid rising controversy over the war, Walter Cronkite decided to travel to Vietnam to see for himself and returned feeling that the United States would have to accept a stalemate in that country.

Much of the controversy surrounding the war originated on the country's campuses, where students became increasingly dissident. This, too, was covered by the media, as was the 1968 Democratic convention in Chicago, where youths outside the convention hall protested the nomination of Hubert Humphrey. The media became embroiled in the controversy. On the one hand, they were accused of inciting the riot conditions because the demonstrators seemed to be trying to attract media coverage. On the other hand, many people inside the convention hall learned of the protest by seeing it on a TV monitor and might not otherwise have known of this show of discontent.

A vast wasteland

In 1961, Newton Minow, Kennedy's appointee as chairman of the Federal Communications Commission, spoke before the annual convention of the National Association of Broadcasters. During his speech, Minow, who had seemed favorable toward broadcasting, startled his audience with the following words:

I invite you to sit down in front of your television set when your station goes on the air and stay there without a book, magazine, newspaper, profit-and-loss sheet, or rating book to distract you-and keep your eyes glued to that set until the station signs off. I can assure you that you will observe a vast wasteland.

The term vast wasteland caught on as a metaphor for television programming. The executives were not happy with Minow's phrase.

During the early 1960s, the dominant fare was violence. The original versions of such programs as The Untouchables, Route 66, and The Roaring 20s all featured murders, jailbreaks, robberies, kidnappings, torture, and blackmail. Saturday morning children's programming was also replete with violent cartoons. A surge against violence, aided by Minow's challenge, spurred a shift to shows about doctors, such as Dr. Kildare, and more comedies, such as The Dick Van Dyke Show, Gilligan's Island, The Beverly Hillbillies, and Hogan's Heroes.

During the 1960s, old Hollywood movies established themselves on TV. In 1961, Saturday Night at the Movies began a prime-time movie trend that, by 1968, saw movies every night of the week. This rapidly depleted Hollywood's supply of old films, and some of the low-quality films that made it onto the airwaves enhanced the vast wasteland theory. In 1966, NBC made a deal with Universal to provide movies that were specially made for television and would not appear in theaters first. This concept, caught on, and by 1969, all three networks had made-fors on a regular basis.

The public broadcasting act of 1967

Meanwhile, educational broadcasting was undergoing its own transformation. The Ford Foundation, feeling that it was shouldering too much of the support to educational television, cut back on funding.

 A number of organizations and councils appeared and disappeared, trying to solve the financial problems, but the result was lack of focus and political infighting.

The Carnegie Foundation finally came to the rescue by setting up the Carnegie Commission on Educational Television. This group of highly respected citizens spent two years studying the technical, organizational, financial, and programming aspects of educational television and in 1967 published its report. The commission changed the term educational television to public television to overcome the pedantic image the stations had acquired. It also recommended that "a well-financed and well-directed system, substantially larger and far more pervasive and effective than that which now exists in the United States, be brought into being if the full needs of the American public are to be served".

Most of the Carnegie Commission's many recommendations were incorporated into the Public Broadcasting Act of 1967. There were two major changes between the Carnegie recommendation and congressional passage of the act, however. One was that radio was added to the concept. The Carnegie Commission addressed itself only to TV, but the radio interests that led to NPR were included by Congress. The Carnegie group recommended that public broadcasting be given permanent funding, perhaps through a tax on TV sets, but Congress opted for one year's funding of $9 million with additional funding to be voted on later.

The Public Broadcasting Act of 1967 provided for the establishment and funding of the Corporation for Public Broadcasting (CPB) to supply national leadership for public broadcasting and to make sure that it would have maximum protection from outside interference and control. Government money was given to CPB, which, in turn, gave money to stations and networks. In this way public broadcasters were protected from government influence. The CPB's 15-member board (later changed to 9) was appointed by the president with the consent of the Senate. The main dudes of the board were to help new stations get on the air, to obtain grants from federal and private sources, to provide grants to stations for programming, and to establish an interconnection system for public broadcasting stations.

The CPB was specifically forbidden from owning or operating the interconnection system. The corporation, therefore, created the Public Broadcasting Service (PBS), an agency to schedule, promote, and distribute programming over a wired network (the use of wires disappeared in 1978 when PBS became the first network to distribute programming totally by satellite). PBS had a governing board consisting of station executives. This service was not to produce programs, but rather to obtain them from such sources as public TV stations, independent producers, and foreign countries. Hence a three-tier operation was established: (1) The stations produced the programs; (2) PBS scheduled and distributed the programs; and (3) CPB provided funds and guidance for the activities.

The advent of the Corporation for Public Broadcasting and its accompanying funding allowed public television to embark on innovative programming of high quality. The first series to arouse interest was the successful children's series Sesame Street, first produced in 1969 by a newly created and newly funded organization, the Children's Television Workshop (CTW). This series helped strengthen PBS as a network because it was in demand throughout the country.

Other early PBS series that met with sustained popularity were Mister Rogers' Neighborhood, a children's program produced in Pittsburgh; The French Chef, Julia Child's cooking show produced in Boston; Black Journal, a public affairs series dealing with news and issues of importance to African Americans produced in New York; and Civilization, a British import on the development of Western culture.

Government actions

The organization for public broadcasting set up by the Public Broadcasting Act of 1967 looked good on paper, but it had problems in operation. A major Nixon-era controversy surfaced during the Nixon administration when the CPB, which had controversies been formed to insulate public broadcasting from government, became somewhat of an arm of the government. The conflict centered on programs that were critical of the government and around the concept of localism.

The programs that caused ire were primarily nationally aired documentaries and public-affairs programs that were against Nixon and his policies. As more and more of these programs airea, members of the administration began stating that public television should emphasize local programs, not national ones. Many people within public television thought this localism policy was espoused because the administration believed local programming would not be as influential as national programming and, therefore, any criticisms of the administration that did creep in would not become significant issues.

The administration carried its localism philosophy into the budgeting area. Richard Nixon vetoed a bill that would have given public broadcasting $64 million for 72-73y. With this action, the chairperson and president of CPB resigned, and Nixon appointed new people to the posts who were more in line with his way of thinking. With CPB now more in tune with the administration, a schism developed between CPB and PBS over who should control the programming decisions for public broadcasting. PBS wanted to continue news and documentary programs having a national emphasis. CPB pressed for local control and an emphasis on cultural programming rather than on documentaries. The controversy continued but gradually abated as Watergate consumed the administration and Nixon was forced to resign.

During the 1970s, government regulators and commercial broadcasters also played a cat-and-mouse game that often engendered hard feelings. In 1970, the FCC adopted a rule barring networks from acquiring financial interest in independently produced programs and from engaging in domestic syndication of these programs or their own network-produced programs. This rule, called financial interest-domestic syndication (fin-syn), was adopted because the FCC (and the Justice Department) thought the networks, which at the time had about 90 percent of the prime-time audience, were too powerful in the programming business. The rule stated that networks could produce only 3-1/2 hours of the 22 prime-time hours available each week.

The bulk of the shows during the next three decades were produced by independent production companies. For example, The Mary Tyler Moore Show and its spin-offs Rhoda and Phyllis were produced by MTM, headed by Grant Tinker. All in the Family, the first situation comedy to deal with previously taboo subjects such as politics, ethics, and sex, came from Tandum-TAT, headed by Norman Lear and "Bud" Yorkin. After these programs aired on the networks, the rights reverted to the production companies, which gained the profits from syndication.

The networks began to complain about fin-syn in the mid-1980s. They pointed out that there were now many sources of programming with the growth of cable TV, so their power was no longer dominant. They were hamstrung by not being able to produce and profit from programming they aired. Obviously, the independent Hollywood production companies that supplied the programming wanted to keep the rule. In 1995, the networks won and fin-syn was abolished, enabling the networks to produce more of their own product and profit from it financially.

In 1971, the FCC established the prime-time access rule (PTAR). The purpose was to break the monopoly the networks had on programming between 7:00 and 11:00 P.M. so some of this time could be programmed by stations to meet community needs and allow more room for syndicated programs. The rule stated that networks would be allowed to program only three hours a night in stations in the top 50 markets, leaving the other hour to the local affiliates. During this hour, there were to be no old network programs or old movies; all programs had to be new. However, the rule was modified so that prime-time access became 7:30 to 8:00 P.M., Monday through Saturday.

Although prime-time access was established to allow stations to broadcast local programming and independently produced programs of high quality, this did not happen to any significant degree. The stations filled the time with the cheapest thing they could find—game shows and remakes of old formats, although some developed local magazine shows. As the years progressed, the various entities involved argued about the efficacy of the rule, and in 1995 the FCC abolished it. This action, combined with the death of fin-syn, opened the way for many potential changes in the business of producing and distributing television programming.

Family hour began in 1975 as an attempt to curtail sex and violence before 9:00 P.M., when children are watching. The family-hour concept originated with the code of the National Association of Broadcasters (NAB), an industry organization. Some believed the code came about through subtle pressure by the FCC and, hence, represented an abhorrent attempt by the commission to regulate program content. The family-hour idea was widely opposed by writers, producers, and directors, who took the concept to court. Eventually it was decided that the FCC had overstepped its powers and that the family-hour restrictions should be removed from the NAB code.

Technical authorizations of the 1980s

lie FCC authorized TV stereo broadcasting in 1984, which caught on quickly, The stations cost to convert from mono to stereo ran between $50,000 and $100,000, but more than 60 stations did so within the first year and many more Mowed. Stereo TV was a technological change that happened without the trauma associated with other changes, such as color TV and UHF.

During the 1980s, the FCC also authorized a new type of over-the-air TV called low-power TV (LPTV). Beginning in 1980, the FCC started accepting LPTV | applications for 10-watt VFLF and 1,000-watt UITF stations that can be put on the air for as little as $50,000. These stations are sandwiched between regularly I operating stations and cover only a 12- to 15-mile radius. For example, if a city f has a Channel 4 and a Channel 6, a low-power station can operate on Channel 5, provided it does not interfere with either of the full-power stations. The FCC I established LPTV to enable groups not involved in TV ownership to have a voice in the community, hoping that women and minorities, in particular, would apply. Many did, but many large companies also applied. The FCC received I more than 5,000 applications by April 1981, when it decided to impose a freeze on applications to sort things out.

 Eventually the FCC began giving out I allocations and, at present, several thousand low-power stations are on the air.  Some provide movies, foreign-language programs, music videos, or religious programs.

 Others make modest profits from local programs, such as high school band concerts and farm reports. Still others are affiliated with networks that formed primarily to provide programming for LPTV or for cable TV.

Acquisitions and start-ups

The 1980s were not financially good times for over-the-air commercial television. Stations and networks were faced with competition from cable TV and other newer media, which splintered the audience and the advertising dollar. Profits were down almost universally, and some stations even went bankrupt. This downturn in broadcasting, combined with a national phenomenon of company takeovers, led to major changes in the management and ownership of all three networks.

The first network affected was ABC, which was purchased in 1985 for $3.5 billion by Capital Cities Communications, a company one-third the size of ABC. Although the takeover was termed "friendly," it was the first time in history that a major network had been purchased, and it was referred to as "the minnow swallowing the whale." CapCities kept ABC for 10 years and then sold to Disney, headed by Michael Eisner, for $18.5 billion, a tidy profit for a minnow.

Less than a year after Capital Cities bought ABC, a second major network, NBC, was purchased as part of an overall takeover of its parent company, RCA. The purchaser was General Electric, a company that had been involved in the formation of NBC and then eased out of ownership by RCA. This, again, was called a "friendly takeover." In 2004, NBC spread its wings further and merged with Universal in a $14 billion deal that garnered the network a strong production facility.

Things were not so "friendly" in the CBS executive suites. In 1985, Ted Turner of Turner Broadcasting attempted an unfriendly coup that CBS thwarted only by buying back much of its own stock, an act that greatly damaged CBS's financial footing. In 1986, William Paley, who had retired earlier, came back to CBS and formed an alliance with Lawrence Tisch, who also was nibbling at the edges of CBS in what some thought was a takeover bid. Tisch was appointed chief operating officer so his "takeover" did riot involve any formal exchange of stock. In 1995, Tisch arranged to sell CBS to Westinghouse for $5.4 billion, placing another pioneer radio company back in the network business. In 1997, Westinghouse changed its name to CBS and then, in 1999, merged with Viacom, a major TV distribution company.

As with radio, the growth of the Hispanic population spurred growth in Spanish-language programming. Two major networks, Univision and Telemundo, dominate distribution, and a third service, Univision is the largest network and has acquired other entities including the cable network Galavision and the radio group Hispanic Broadcasting. In 2001 NBC bought Telemundo and beefed up its original programming in an attempt to be more competitive.

The Fox network appeared on the scene in 1987. Rupert Murdoch, an Australian media baron who had recently obtained U.S. citizenship, purchased 20th Century Fox and six TV stations owned by Metromedia in the mid-1980s. He then built a network using his six stations and other independent stations throughout the country. Fox increased the number of programs offered to its affiliates slowly, but a number of its shows, such as The Simpsons quickly became hits, and by the end of the 1990s Fox established itself as a major network force.

Fox's success encouraged the 1995 launch of two other networks, United Paramount Network (UPN) and the WB Network (Warner Bros.). Their owners at the time, Paramount and Time Warner, were hedging their bets, in part, regarding financial interest-domestic syndication. If the established networks were going to be allowed to produce, own, and call the shots regarding their programming, Paramount and Time Warner wanted to make sure they would have outlets for the TV programs they produced.

The waters muddied a bit, however, because Paramount merged with Viacom, which then merged with CBS, meaning that Viacom/CBS owned two networks, CBS and UPN. A 1940s rule stipulated that a company could own only one network, but in 2001 the FCC relaxed that restriction allowing both UPN and CBS to be owned by one company. Warner underwent ownership changes, too, first by buying Ted Turner's cable networks. Then in 2000 America Online bought Warner in a highly hyped deal that created AOL Time Warner. This deal did not live up to expectations and Warner finally exerted dominance over the internet company and in 2003 removed AOL from the letterhead, once again becoming Time Warner.

One other broadcast network, Pax, was started 0 1998 by Bud Paxson, a TV station owner. It programs some original fare, but mostly reruns of family-friendly programs that have previously been on other networks. For several years, starting a 2000, NBC invested in Pax but in 2004 decided to sever its ties.

So the commercial broadcast network scene at present consists of seven networks-ABC owned by Disney, CBS as part of Viacom/CBS, NBC owned by GE as part of NBC/Universal, Fox owned by Rupert Murdoch, WB owned by Time Warner, UPN owned by Viacom/CBS, and Pax owned by Paxson Communications.

The Telecommunications Act of 1996

The Communications Act of 1934 served broadcasting well for decades, mainly because the American system of government allows laws to be interpreted by the courts and regulatory bodies such as the FCC. These interpretations lead to precedents that can accommodate changing times. In addition, the act was amended to take into account alterations such as those related to using television for electioneering.

But by the late 1970s, the 1934 act was showing its age, and Senator Lionel Van Deerlin proposed a rewrite. His new bill was never passed, but a number of the deregulation ideas were put into effect by the FCC. For example, in 1984, TV station licenses were lengthened from three years to five, and the number of TV stations one entity could own was increased from 7 to 12, provided the 12 stations were not in markets that collectively contained more than 25 percent of the nation's TV homes.

In 1996, Congress did pass a sweeping new law, the Telecommunications Act of 1996. It did not replace the Communications Act of 1934; it deals with newer technologies such as cable TV and the internet. For the TV industry, the Telecommunications Act of 1996 was part deregulatory and part regulatory. Following the deregulatory line, it extended license renewal to eight years, eliminated the 12-station numerical cap, and raised the coverage area from 25 percent to 35 percent.

But the amount of sex and violence on television bothered the members of Congress who wrote the bill, so regulatory provisions were included that related to programming content. The main one was that TV sets had to be equipped with a V-chip, a device that consumers could use to block programs with violence, sex, or other undesirable material. The television industry was required to develop a rating system to earmark these programs and then encode the programs electronically so the chip could identify them and block them from coming into households where they were not wanted. The industry provided the following age-based rating system :

TV-Y: all children

TV-Y7: directed toward older children

TV-G: for general audiences

TV-PG: parental guidance suggested

TV-14: probably unsuitable for children under 14

TV-MA: mature audiences only

However, Congress and citizen groups said these ratings did not give enough information and wanted content-based information. As a result, most of the industry added codes to the end of the rating: V = violence, S = sexual situations, L = coarse language, and D - suggestive dialogue. Studies are showing, though, that not many people use the V-chip. This does not mean that the population has accepted sex and violence on TV, however. The issue has been hotly touted, especially since Janet Jackson bared her breast during the 2004 Super Bowl halftime show.

In 2003 the FCC attempted to go beyond the ownership provisions of the Telecommunications Act and extend the coverage area from 35 percent to 45 percent. This brought objections from politicians and citizens who did not approve of how big individual media companies were becoming. As a result Congress tried to establish a compromise at 39 percent, but the courts also got into the act and the matter has yet to be resolved.

Programming Changes

A main change in TV programming after the 1970s was the introduction of a new genre, reality TV. The genre came to the fore in the 1990s and featured actual events or reenactments of events, some of which were bizarre. Networks and stations liked these programs because they garnered fairly large audiences and were inexpensive to produce. The reality genre experienced a big jump in popularity in the summer of 2000 when CBS broadcast Survivor, the trials and tribulations of specially selected ordinary citizens as they overcame challenges of living in the South Seas and competed for a $1 million prize by voting each other off the island. The short series was such a success that many clones and variations appeared in the following years, including more Survivor series and NBC's The Apprentice, starring Donald Trump who made "You're fired" a well-known phrase as contestants aspiring to a job with his firm were eliminated.49 High-stake game shows, which had been sparse in prime time since the scandals of the 1950s, also made a comeback, particularly with the ABC hit Who Wants to Be a Millionaire?, hosted by Regis Philbin, which started in 1999.

Two whole new forms of programming, home shopping and infomercials, arose because, as part of deregulation, the FCC lifted restrictions on how much advertising a station could program. Home shopping programs were essentially total advertisements in that they showed and extolled the virtues of products that people could buy over the telephone. Infomercials, often in the form of talk shows or information programs, devoted half-hour time slots to the virtues of products such as weight-control programs and baldness treatments. Stations particularly liked these infomercials because the producers paid the stations to air them.

The old genres also continued. Network ratings leaders from the 1980s to the 2000s included standard situation comedies—Cheers, The Cosby Show, Friends—and standard dramas—ER, Law and Order, The West Wing (see Exhibit 2.26). Subjects that previously were taboo, such as homosexuality, incest, and wife beating, became fairly common. Some of these subjects had appeared earlier in daytime soap operas, but during the 1980s, 1990s, and 2000s they became common in prime time. Talk shows, magazine shows, and even news programs delved into the most private of subjects.

Although it may not be obvious to the average viewer, the sources of programming have changed because of the repeal of fin-syn. All the major networks have production studios tied to movie production facilities (NBC to Universal, CBS to Paramount, ABC to Disney, WB to Warner, and UPN to Paramount). As a result, they are producing more of their own material and buying less from independent producers. Or, if they do buy from independents, they negotiate to own a piece of the show and profit from it financially. This makes life much more difficult for independent companies who still want to sell their wares to broadcast networks. On the other hand, because there are so many more networks, both broadcast and cable, independents have more potential customers.

Meanwhile, public television continues to try to provide quality programming, much of which has aired for decades. In the informational area it has Frontline, a documentary series that has been on since the 1980s; P.O.V., a series that features independently produced works; and The News Hour with Jim Lehrer, which is often acclaimed for its in-depth look at news issues. In 1990 it aired an 11-hour epic, The Civil War, which drew a high audience for PBS-approximately 9 percent of all households. The longest-running show in the drama department has been Masterpiece Theatre, which started in 1970. Children's television has remained a forte of public broadcasting with Sesame Street, Barney and Friends, Teletubbies, and other shows.

Digital television

Digital television (DTV) and high-definition television (HDTV) are starting to play an important role in the lives of broadcasters. The two are intertwined but not the same. Digital TV uses technology similar to computers where signals are coded as either off (0) or on (1), as opposed to the NTSC system that uses analog waves. High-definition TV has more lines on the TV screen—about 1000 as compared to the 525 lines of the traditional standard-definition TV—and it also has a wider screen. HDTV can be analog or digital and digital TV can be standard or high definition, but television of the future will probably be digital HDTV.

HDTV was originally developed by the Japanese in the 1970s as an analog system.

 At one point during the 1980s it was almost adopted in the United States and other parts of the world, but the plan fell apart. In 1990, the American company General Instruments proposed an all-digital high-definition HDTV system Shat had the technical advantages inherent in digital technology, such as clearer sound and no loss of quality when tapes were copied. In 1993, a consortium of companies called the Grand Alliance joined to further develop this digital system, which in 1997 was adopted by the FCC to be the American system of improved-definition television. In 1998 the FCC gave each broadcast station in the country a new frequency for digital HDTV transmission, which it was to develop while still continuing to broadcast on its old analog channel. All stations were supposed to have their digital channels up and running by May 2002, but because of technical problems and because it costs up to $4 million to convert to digital, many stations fell behind schedule. The plan now is for all TV stations in the country to switch from analog transmission to digital transmission by 2006 and give back their analog frequencies to the FCC so it can make the frequencies available for other uses. It is looking like a more realistic date will be 2009.

Another part of the equation is availability of digital HDTV sets to consumers. If stations must turn over their analog frequencies to the FCC, then viewers must have new digital sets to receive station programming. To facilitate this, the FCC has ordered that all new TV sets have DTV tuners by 2007. Of course, the FCC cannot order consumers to actually buy these new TV sets.

Issues and the future

As the industry consolidates and fewer companies own more and more, some worry that independent voices will be lost, especially in the area of news and information. A company that owns several networks can promulgate a point of view to a large number of people. Yet, so many people are involved in the information dissemination process that it is difficult to control all of them, so independent views can surface, even within large organizations.

The issue of sex and violence on TV is not likely to go away. Although people indicate they want this fare reduced on broadcast television, they do not utilize devices such as the V-chip that could help in this regard. Politicians try to "clean up the airwaves," but they are hamstrung by the First Amendment and often only campaign against sex and violence in election years when they see the issue as one that may garner them votes. Broadcasters feel they will unfairly lose their audience to cable networks because, at present, those networks are not highly regulated and can program edgier material.

Digital TV raises many issues. One is a chicken-and-egg problem that is similar to what occurred with color TV. People will not feel a need to buy a digital TV set for limited programming. Many networks are programming in HDTV, but it may be awhile before the cost of HDTV sets will be low enough to entice people to get rid of their old analog sets. Also, most people now receive their TV over cable or satellite TV, so the whole process of having a station broadcast through the airwaves seems irrelevant. Wouldn't it be better to do away with the stations and have the broadcast networks deliver their material to the cable or satellite providers, like the cable networks do?

Cable networks are not eager to carry the local station digital transmissions and have particularly balked at carrying both analog and digital during the changeover period. In addition, not all stations are using their new frequencies for high-definition delivery. Some have decided to multicast, programming several channels of standard-definition material or perhaps one high-definition signal and one standard-definition signal. For the stations, this could represent an extra source of revenue, but the FCC has ruled that cable systems do not need to carry all the signals.

In the meantime, the computer world is threatening to horn in on the basic business of commercial television networks. Computer-based companies are establishing entertainment networks that can be received and viewed with computer equipment, and broadcasters are struggling to find ways to make their technology appear to be interactive to compete with the internet. One thing they have done with some reality shows, such as American Idol, is have the public vote for the singers (or others) who should move up to the next level. Other shows, such as CSI: Miami, send viewers to websites where they can help solve the murder by going through evidence.

Public television has its own issues. Its ratings are going down and its demographics are getting older as cable channels such as Arts and Entertainment, Discovery, and BBC America take away its audience. When it tries to program for a younger audience, it alienates its core audience. It receives about 35 percent of its funding from government sources, but legislators are questioning whether it is relevant enough to merit taxpayer dollars.

Broadcast television has overcome many challenges in the past as it has undergone structural and programming changes. Its star appears to be sinking as newer forms of distribution take hold, but it still provides some of the most popular programming viewed in the country.

Summary

In some ways, television technology seems to prove that necessity is the mother of invention, but in other ways it suggests that invention is the mother of necessity. On the one hand, because the original mechanical scanning techniques might never have been adequate for a popular medium, the electronic techniques were necessary. On the other hand, matters such as lines of resolution and color were hotly debated by various industry groups, but only after the technology was approved did the need for its existence become evident. The invention of the videotape recorder altered TV production techniques in ways not previously envisioned. Similarly, both UHF and LPTV were authorized without their range of possibilities being explored. The future for digital TV and interactivity is not yet determined.

Television's greatest boosters could not predict how quickly and thoroughly TV would be accepted by the American public. The medium's growth in terms of TV sets, programs, and advertising during the late 1940s and early was phenomenonal. Performers such as Milton Berle and Lucille Ball became instant celebrities. More reluctant 'TV stars," such as Senator Joseph McCarthy, found that TV could also create notoriety.

The elements of government that dealt with radio suddenly found a new medium featuring both sight and sound on their doorstep. Taking a cue from radio, the FCC imposed a freeze to work out technical allocations. The choice of UHF to resolve the channel shortage was not the most fortuitous decision. Other controversial government actions included instituting prime-time access, influencing the family-hour concept, imposing the financial interest rule, deregulating, implementing legislation requiring ratings and the V-chip, and setting ownership limitations.

Private business was also influential in TV from the birth of networks to the rash of takeovers and the creation of new networks in the 1980s and beyond.

Different forms of programming have surfaced over the years. The early forms, taken from radio, were enhanced by movies as the TV industry and Holly-: wood developed closer ties. Programs' subject matter became much more liberal over the years, and reality programming became popular.

Successful programs, such as Texaco Star Theater, I Love Lucy, Marty, Gun-smoke, All in the Family, Friends, and Survivor depend on group efforts. Many individuals also made significant contributions, among them David Sarnoff, William Paley, "Pat" Weaver, and Rupert Murdoch.

Television survived dark moments, such as blacklisting and the quiz scandals. This medium was accused of inciting riot conditions during the 1968 Democratic convention and praised for unifying a nation during the Kennedy assassination. Its future will undoubtedly change, but commercial television-which took the country by storm in a historically short period-seems bound to continue.

 

Cable and satellite television

Today cable TV and satellite TV look very much the same. They are both capable of delivering multitudes of channels to home TV s. Together they have largely replaced over-the-air local broadcasting as the means by which most people  receive their TV signals. But they have very different histories. Cable television is almost as old as television broadcasting, although it struggled for several decades before it received any widespread recognition. Satellite TV (also called direct broadcast satellite or DBS for short) didn't take hold until the1990s, although it sputtered during the early 1980s while cable was enjoying glorious high-growth days……..Technologically, the two are also different. Cable is delivered over wires that run through neighborhoods and into homes. Satellite TV comes from outer space to dish antennas mounted on the sides of homes. Although each cable or satellite system tries to have unique features, much of the programming that they distribute the same….. For this reason, they have become competitors, each trying taking away the other's customers.

The beginnings of cable TV

In the early days, the only thing cable TV did was retransmitting signals from broadcast TV stations into areas that had poor reception. There are many different stories about how cable TV actually began. One is that it was started in a little appliance shop in Pennsylvania in 1948 by a man who was selling television sets. He side of town. After investigating, he discovered that, the people on the other side of town could not obtain adequate reception, so he placed an antenna at the top of a hill, intercepted TV signals, and ran the signals through a cable down the hill to the side of town with poor reception. When people on that side of town would buy a TV set from him, he would hook their home to the cable.

One factor that helped cable TV in its beginning was the freeze on TV station expansion from 1948 to 1952. The only way that people could receive TV if they were not within the broadcast path of one of the 108 stations on the air was to put up an antenna where the signal could be received and run that signal through a wire to where they wanted it. As a result, neighbors in remote and mountainous areas built rudimentary cable TV systems in order to provide television reception for them.

Within a short time small "mom-and-pop" companies took over the stringing of cable as a moneymaking venture, charging the people who wanted to receive television an initial installation fee and monthly fees compatible with modest profits. If there were no local signals available, these companies carried the three network signals by importing them from stations in nearby communities, a practice that became known as distant signal importation. Fourteen such signal importation companies were in operation by the end of 1950, and the number grew to 70 by 1952.

With 65,000 subscribers and annual revenue of $10 million in 1953, cable TV was only a minor operation. Most broadcasters were unconcerned about this business that was growing on the fringes of their signal contour. Some, however, were becoming alarmed by the attitude of permanence growing in some cable systems. Coaxial cable was replacing the open-line wire of early days, and space was leased on telephone poles for line distribution instead of the house-to-house loops augmented here and there by a tree.

Cable TV became more sophisticated as it grew. In addition to importing signals into areas where there was no television, cable companies began importing distant signals into areas where there were a limited number of stations. For example, if a small town had one TV station, the cable system would import the signals from two TV stations in a large city several hundred miles away; this importing of distant signals caused the first objections to cable TV. Existing TV stations in an area found that the size of their audience shrank because people watched the imported signal. Sometimes the imported signal was the same that was showing on the local station. For example, a local station might be showing a rerun of / Love Lucy and find that the imported station was showing the same rerun, splitting the show's audience in half. Because of the smaller audience, local stations could not sell their ads for as high a price as before the importation. In the late 1950s, some stations in areas affected by cable TV appealed to Congress and the FCC for help. Congress drafted legislation to license cable operators, but, in 1960, the bill was defeated. With the failure of federal intervention came a rash of state and local attempts to assert jurisdiction over cable.

In most areas, the local city council became the agency that issued cable franchising and stipulated how the cable system was to conduct business. Competing applicants for a cable franchise would present to the council their flans for operation of the system, including such items as the method of hookup (for example, telephone poles or underground cable), the fees to be charged to is customer for installation and for regular monthly service, and the percentage of profit that the company was willing to give the city for the privilege of Wing the franchise. Based on this information, the council awarded the franchise to the company it believed was most qualified. During the 1960s, this was very calm process; usually only one or two companies applied for a franchise in a given area. Areas with good reception did not even bother with franchising because no companies applied.

The number of cable systems doubled between 1961 and 1965, but cable    TV was still small business. In 1964, the average system served only 850 viewers and earned less than $100,000 annually. Multiple-system operators (MSOs)- companies that owned a number of cable TV systems in different locations-owned less than 25 percent of cable systems because of the lack of economic incentives.

The FCC maintained a policy of nonintervention in cable TV matters during the early 1960s, hoping the courts would settle the problems between the operators and broadcasters. But the situation only became more confused as court cases piled up. One court case referred to as the Carter Mountain case, however, did set a precedent. In 1963, an appeals court ruled that the FCC could refuse to authorize additional facilities to Carter Mountain Transmission Corporation, a cable company in the Rocky Mountains, because the cable company might damage the well-being of the local broadcast stations. This gave the FCC power to restrict cable to protect broadcasters.

Early cable TV regulations

In April 1963, the FCC took its obligations regarding cable TV more seriously and issued a notice that covered two main areas: (1) All cable systems would be required to carry the signal of any TV station within approximately 60 miles of its system; and (2) no duplication of program material from more distant signals would be permitted 15 days before or 15 days after a similar local broadcast.

The rule of local carriage, which became known as must-carry, caused little or no problem. Most cable owners were glad to carry the signals of local stations. The 30-day provision did cause bitter protest from cable operators because it limited their rights in relation to what they could show on their distant imported stations. This rule, known as syndicated exclusivity, meant that if a local station was going to show an / Love Lucy rerun on January 15, a cable TV operator would have to black out that rerun on a distant imported station if it showed any time during the month of January. The cable TV industry marshaled its forces and succeeded in having the 30-day provision reduced to only one day. This, of course, angered the broadcasters.

A report issued by the FCC in 1966 put more restrictions on cable service. This order came when 119 cable systems were under construction, 500 had been awarded franchises, and 1,200 had applications pending. All these systems were required to prove to the FCC that their existence would not harm any existing or proposed broadcast station in their coverage areas. By not increasing its staff to handle this load, the FCC was, in essence, freezing the growth of cable. This made broadcast station owners very happy. But the effect of this ruling on cable operators during the remaining years of the decade was not what the FCC had envisioned. Cable companies that were unable to expand were sold to large corporations that could withstand the unprofitability of the freeze period. Multiple-system operators were quite prevalent by the 1970s.

Another regulatory issue to cause consternation between broadcasters and cable operators during the 1970s was the payment of copyright fees. When cable systems transmitted broadcast signals, they did not pay any fees to those who owned the copyrights to the materials. In some instances, networks or stations created the material, so they owned the copyright. In other cases, the network or stations purchased program material from film companies or independent producers and paid copyright fees. The stations, networks, film companies, and independent producers believed cable companies should pay copyright fees for the retransmission of material because these retransmission rights were not included in the broadcast TV package. Cable operators thought they were exempt from paying fees for retransmission rights because they were merely extending coverage. 

In 1976, a new copyright law was passed and one of its provisions was that cable TV systems were required to pay compulsory license fees to a newly created government body called the Copyright Royalty Tribunal. This body would then distribute the money to copyright owners. The amount of this compulsory license fee was 0.7 percent of the cable operator's revenue from basic monthly subscriptions. The copyright law gave the tribunal authority to adjust the rate for inflation. Both cable operators and copyright holders seemed happy with this plan. However, the issues of must-carry, syndicated exclusivity, and copyright were to remain a thorn in the relationship between cablecasters and broadcasters, as we shall see later.

Early Cable TV Programming

Cable TV was a common carrier when it first began;, that is, cable companies picked up signals and brought them into homes for an installation charge and regular monthly fees. This meant the programming came only from local stations or from distant signal importation…….The very early systems had only three channels for the three broadcast networks. As television and its resulting technology grew, cable systems provided as many as 12 channels of programming. The cable system could use each channel from 2 through 13 because its signals were on wires that were not subject to the same interference that makes it impossible to use all 12 channels of broadcast TV in a particular area, but cable had not yet developed the technology to accommodate all the extra channels it has today.

 

 Different cable systems placed varying programming on these 12 channels, but this usually consisted of converting all the local VHF stations plus all the local UHF stations to VHF space on the dial. If there weren't many local nations, then the cable system would bring in stations from nearby communities.

Under this early system, there was no local origination of programs. Gradually, however, some cable facilities began to undertake their own programming. The most common "programming" involved unsophisticated leather information. Cable TV operators would place a thermometer, barometer, and other calculating devices on a disc and have a TV camera take a picture as the disc slowly rotated. This would then be shown on a vacant channel so people in the area could check local weather conditions. Some systems had news of sorts. This might involve a camera focused on bulletins coming in over a wire-service machine or on 3-by-5-inch cards with local news items typed on them. It was a simple, inexpensive, one-camera-type of local origination. Gradually, more complex local origination was started, usually in the form of local news programs, high school sports events, city council meetings, and talk shows on issues important to the community".

In October 1969, the FCC issued a rule that required all cable TV systems with 3,500 or more subscribers to begin local origination no later than April 1970.

 The purpose was to promote local programming in areas where it had not previously existed. By April 1970, many of the cable TV operators that were not engaging in local origination claimed hardship, telling the FCC that they did not have the funds to build studios, buy equipment, and hire crews. The FCC order was not enforced and later was modified to say that the systems only needed to make equipment and channel time available to those who wished to produce programs.

This brought about a different type of local programming known as public access. Individuals or groups used the equipment provided by the cable operator to produce programs without the operator's input or sanction and then cablecast those programs over one of the system's channels. This differed from local origination, which was programming planned by the cable system. In most areas, public access was not a huge success, and the equipment provided by the cable company was largely unused for lack of interest. In other areas, particularly where cable systems showed an active interest in local programming, some exciting and innovative projects were undertaken. Sometimes, unfortunately, the people using public access time were would-be stars who used cable for vanity purposes or people from fringe groups who promoted various causes or even lewd modes of behavior. Such individuals and groups gave public access an unsavory reputation.

Another form of local programming instituted by some cable systems was the showing of movies. A cable company would use one of its channels to show movies that only subscribers who paid an extra fee could receive. These movies were leased from film companies and shown without any commercial interruption. Regulations prevented cable systems from showing the well-torn films that broadcasters wanted to show during prime time, but because tie small cable systems had only a small number of subscribers who would pay for the movies, they could not afford to pay for blockbuster movies anyway. The channels for movies were not a huge success, but they did bring extra income to sue cable systems…..Throughout the 1960s and 1970s, promises were made, broken, and remade is the potential services and programs that would be available through cable. Cable lived on the edge of a promise that "within the next five years" cable TV would perk your coffee, help your kids with their homework, secure your home, do your shopping, and teach the handicapped. Except for a few isolated experiments, cable remained, until the mid-1970s, primarily a medium to bring broadcast signals to areas with poor reception.

HBO's influence

The stage was set in 1975 for a dramatic change in cable programming when Home Box Office (HBO) began distributing movies and special events via satellite. Home Box Office was actually formed in 1972 by Time, Inc., as a movie/ special pay service for Time's cable system in New York. The company decided to expand this service to other cable systems and to set up a traditional microwave link to a cable system in Wilkes-Barre, Pennsylvania.

 During the next several years, HBO expanded its microwave system to include about 14 cable companies, but this was not a successful venture and it was not profitable for Time…..In 1975 Time decided to show the Ali-Frazier heavyweight championship fight from Manila by satellite transmission on two of its cable systems. The experiment was very successful, and HBO decided to distribute all of its programming by satellite……As soon as HBO sent its signals to a satellite, they could be received throughout the country by any cable system that was willing and able to buy a receiving dish……HBO then began marketing its service to cable systems nationwide, which was no easy chore. The original receiving dishes were 10 meters in diameter and cost almost $150,000, a stiff price for cable systems, many of which were just managing to break even. But the technology of satellites moved quickly enough that by 1977 dishes in the range of 3 to 4.5 meters sold for less than $10,000.

Another problem HBO encountered centered on the rules that had established mainly for subscription TV (STV), an over-the-air form of broadcasting with a scrambled signal. Programming (mostly movies or sports) was sent from a station antenna into the airwaves, but the signal was scrambled so that it was necessary to buy a special decoder to see a coherent picture. Subscription TV was started during the 1950s, but it was stifled just as cable TV was by FCC restrictions that favored broadcasting. For example, no more than one STV operation was allowed in any one community, and STV and cable systems were prevented from siphoning-bidding on programming, such as movies and sports events, that conventional broadcasters wanted to show. The fear was that pay services might simply take over, or siphon, the programming by paying a slightly higher price for the .right to cablecast the material. HBO and several cable TV system owners took these rules to court. In March 1977, the court set aside the siphoning rules, allowing HBO to develop as it wanted. This allowed STV to develop, too, and for a while subscription TV and the movie services of cable TV systems competed. Cable won, however, because it offered many channels, and STV offered only one. Subscription TV died during the mid-1980s.

Another problem HBO had when it first started marketing its service was its financial relationship with cable systems. At first, it offered the cable system owners 10 percent of the amount collected by charging subscribers extra for HBO programming. Approximately 40 percent of the fee was to go to HBO and 50 percent to the program producers. When cable owners complained about their percentage, HBO raised it so that the systems retained about 60 percent of the money and HBO and the program producers split the other 40 percent.

With receiving dishes manageable in terms of both cost and size, with appealing programming, and with financial remuneration at a high level, cable systems began subscribing to HBO in droves. Likewise, HBO became very popular with individual cable subscribers who were willing to pay extra to receive commercial-free movies. By October 1977, Time announced that HBO turned its first profit.

Soon after HBO started distributing programming via satellite, Ted Turner, who owned a low-rated UHF station in Atlanta, Georgia, decided to put his station's signal on the same satellite as HBO. This meant that cable operators that bought a receiving dish for HBO could also place Turner's station on one of their channels. This created what was referred to as a superstation because it could be seen nationwide. Cable operators paid a dime a month per subscriber For the superstation signal, but they did not charge the subscriber as they did for the HBO pay service. The economic rationale was that the extra program service would entice more subscribers. The charge to the cable companies did not cover the superstation's costs, but the station could charge a higher rate for its advertisements once the superstation had a bigger audience. With two successful program services on the satellite, the floodgates opened and cable TV took on a new complexion.

The beginnings of satellite TV

Meanwhile, however, a different form of satellite service called direct broadcast satellite (DBS) was trying to get established. When satellites were first launched in 1962, the technology was very complicated-well beyond what typical homeowners could handle……But the technology developed and reception dishes became more user-friendly, so in 1979 the FCC issued a ruling stating that no one needed a license to have a TV receive-only (TVRO) satellite dish. In other words, individual households were allowed to own satellite dishes that received (but did not send) programming.One outcome of this 1979 ruling was that Satellite Television Corporation (STC) informed the FCC it wanted to develop a new programming service that would go directly from satellites to homes…..The satellites would have higher power than the ones being used by cable TV systems to receive cable TV networks, so the consumer dishes could be smaller and cheaper than the dishes the cable systems needed.

 The FCC agreed with the basic idea and invited all interested parties to apply for DBS licenses. In 1982, it approved eight of the DBS applications and expected that the services would be operational by 1985…...The FCC mandated that the companies prepare "due diligence" reports in 1984 to make sure the services were on track. With great fanfare, market researchers proclaimed that about 50 percent of people would subscribe to DBS, but, in reality, companies ran into many technical and financial problems as they dealt with the realities of launching high-power satellites.

 Several of the original DBS applicants flunked their "due diligence" tests, and others didn't even bother to fill out the forms. In a surprising 1984 move, STC, the company that had pioneered the DBS concept, announced it was pulling out of the business after having invested five years and $140 million gearing up for it. Prospects for DBS dimmed, and no services were on the air by 1985…..Another result of the 1979 FCC ruling that no one needed a license to own a TYRO was that individuals, particularly those in rural areas where TV reception was poor, bought the large dishes used by cable TV systems and set them up in their backyards. This became known as backyard satellite reception. The dishes by then cost about $3,000, but the people who bought them could then receive all the cable programming for free. This caused a minor stir among cable TV program suppliers, but the number of backyard dishes was so small that the cable providers did not aggressively pursue the issue.

Cable's gold rush

What cable TV did pursue was its own phenomenal subscriber growth sparked mainly by the development of its satellite-delivered services. This led to economic wealth for the companies involved. In 1979, pay revenues grew 85 percent over 1978 figures. The industry predicted that this peak would subside to about 50 percent growth. In 1980, however, pay revenues grew 95.5 percent over 1979 revenues. Between 1975 and 1980, cable TV profits grew 641 percent. With figures such as these, it is no surprise that cable experienced a veritable gold rush.

One way this gold rush manifested itself was in franchising. Cities that could not have given away cable franchises in earlier years because of their clear reception of broadcast TV signals suddenly became prime targets for cable and its added programming services. Most city governments, which selected cable companies, were not accustomed to dealing with such matters. Gradually, through the use of consultants, city councils established lists of minimal requirements that they wanted from the cable companies. Cable companies, in their fervor to obtain franchises, usually went well beyond what the cities required. They, too, hired consultants, who contacted city leaders to learn the political structure and needs of the city and to decide how the company should write its franchise proposal to ensure the best possible chance of winning the contract. Only one company could receive a franchise for a particular area; therefore, cries of scandal sometimes accompanied these procedures as the cable companies tried to gain influence.

The development of local programming became an important part of the franchising process. Cities usually requested the cable companies set aside a certain number of channels for access by community groups. These were often referred to as PEG (public, education, government) channels. To program these PEG channels, cable companies promised to provide equipment and sometimes personnel.

Cable companies began promising cheaper rates, shorter time to lay the cable, more channels, more equipment, and generally more and better everything problems as franchising competition became more intense. Sometimes the winning cable company was unable to meet all the requirements stipulated in the bid, especially in regard to the speed with which the system was to be built. The laying of the cable, however, did move forward at a rapid rate.

As the cable companies promised more and more, they realized they might not recover their investment for about a decade. This hastened a process that was already prevalent within the cable industry-the takeover of small mom-and-pop cable operations by large multiple-system operators (MSOs) and then the consolidation of these MSOs with other large companies. Large companies merged in the cable industry, partly because they wanted to be part of the gold rush and partly because only large companies had the resources to withstand the expenses of the franchising process and the other start-up costs of laying cable, marketing, and programming. Other groups also began to stake their claims in cable's gold rush, advertisers who saw cable reaching close to 30 percent penetration of the nation's households in the early 1980s became interested and began placing ads cable's programming channels, both local and national.24 Members of the various unions and guilds that operate in the broadcasting industry were not involved in cable programming when it first began because the cable companies not recognize the unions. After several long, bitter strikes during the early \ however, the unions won the right to be recognized and to receive residuals from cable TV. Thus, the same people who worked in broadcast programming began working in cable programming.

Perhaps the biggest winners in the cable gold rush were the equipment manufacturers that supplied the materials needed to build the cable systems. The suppliers of the converters that enable a regular TV set to receive the multitude le channels, the earth station dishes, and the cable itself found their order piled high. Space on a satellite became a precious commodity as more and companies wanted to launch national programming services. Although large companies, advertisers, unions, and equipment manufacturers all flocked to cable during the late 1970s and early 1980s, the most noticeable cable growth was in the area of programming.

Growth of cable TV programming service

Shortly after Time became successful with its HBO service, Viacom launched a competing pay cable service, Showtime. Viacom, like Time, owned various cable systems throughout the country and provided them with movies and special events through a network that involved bicycling and microwave. Following the launching of Showtime, Warner-Amex began The Movie Channel, which consisted of movies 24 hours a day. Other pay cable services started in fairly rapid succession: Spotlight,' a Times-Mirror movie service; Bravo (see Exhibit 3.8) and The Entertainment Channel, both cultural programming services; The Disney Channel, a family-oriented pay service featuring Disney products; and Playboy, "adult" programming that included R-rated movies, skits, and specials.

The late 1970s and early 1980s also saw a proliferation of new satellite delivered programming services that became known as basic cable. Some of these were supported by advertising, some were supported by the institutions that programmed them, and some were supported by small amounts of money that the cable companies paid to the programmers. Most of these narrowcast in that they had a specific niche audience in mind: ESPN, all-sports programming started by Getty Oil; Black Entertainment Television, with programming about and for African Americans; CBN, with Christian-oriented family programming; nickelodeon, a noncommercial children's service; CNN, 24 hours a day of news; USA, a network with a variety of programming; C-SPAN, with public service-oriented programming, including live coverage of the House of representatives; ARTS, an ABC-owned cultural service; CBS Cable, an advertising-supported cultural service owned by CBS; MTV. the creator of music videos ; Satellite News Channel, a Westinghouse-ABC joint venture of 24-hour news, established to compete with CNN; Daytime, a service geared toward women; and Cable Health Network, programming about physical and mental health.

The numbers of superstations also grew and were considered part of basic cable. Ted Turner's WTBS was first, but, soon after, WGN in Chicago and OR in New York also went on satellite. In addition, a number of audio ices developed for cable.

Because the franchising process placed so much emphasis on the local community in which the cable TV system originated, local programming took on an entirely new dimension in the late 1970s….The older systems that still only 12-channel capacity usually allocated one channel to local programming. The newly franchised systems that took advantage of improved technology to ' 20, then 54, then more than 100 channels usually promised an entire complement of local channels.

At least one of these channels was usually reserved for local origination-programming that the cable system itself initiated. A number of others were combination of PEG access channels. Some systems had leased access channels for businesses, newspapers, or other individuals interested in buying time on a cable channel to present their messages. The organization and operations of these channels differed widely from community to community. Sometimes cable companies provided equipment, studio space,and professional personnel to help the various groups create their programming and then were responsible for seeing that the programs were cablecast over the system. Some cable companies merely made a channel available for programming, and the local organizations or individuals interested in doing the programming used their own resources for equipment and crew. Not all the local programming planned by cable systems and local groups materialized, but the quality of access programming improved greatly from the early days when access consisted mainly of vanity TV.

Interactive cable was highly touted in franchise applications. Once again, promises were made that cable would perk the coffee, help the kids with homework, do the shopping, protect the home, and teach the handicapped. In some areas of the country, a fair amount of interactive cable was undertaken. The pioneer and most publicized interactive system was Qube, which Warner- Amex cable operated in Columbus, Ohio, starting in 1977……The basic element of Qube was a small box with response buttons that enabled Qube subscribers to send an electronic signal to a bank of computers at the cable company that could then analyze the responses. An announcer's voice or a written message on the screen asked audience members to make a decision about some question, such as who was most likely to be a presidential candidate, what play a quarterback should call, or whether a city should proceed with a development plan. Audience members made their selection by pressing the appropriate button in multiple-choice fashion. A computer analyzed the responses and printed the percentage of each response on the participant's screen.

Home security was another interactive area that cable entered. Various burglar, fire, and medical alarm devices connected to the cable system. A computer in a central monitoring station sent a signal to each participating household about every 10 seconds to see if everything was in order……A signal was sent back to the cable company monitoring station, which then notified the police if any of the doors, windows, smoke detectors, or other devices hooked to the system were not as they should be. These interactive services were largely unprofitable, but proposals for them caught the attention of city councils and were-often responsible, at least in part, for decisions regarding franchise awards.

Cable's retrenchment

Perhaps the cable industry's promises were too lavish and the anticipation too great. Whatever the reason, the bloom fell off the rose in the mid-1980s. The rate of new subscriber growth leveled while the rate of disconnects increased….Programming services consolidated and went out of business, and those that remained sported much of the same type of play-it-safe programming traditionally aired on ABC, CBS, and NBC. MSOs drowned in red ink as they tried to live up to the promises they made in regard to wiring big cities.

Advertisers did not respond to the cable lure as quickly or profusely as expected. Even a magazine produced by Time about cable TV programming failed.

Companies took actions to stem financial woes. In 1985, Group W (Westing-house) sold all its systems to five cable TV companies, which then divided the systems among themselves. Storer and Times-Mirror traded several, systems to create more geographically contiguous operations. A few companies, such as Tele- Communications, (TCI) and American Television and Communications (owned by Time Warner), acquired more systems, while other companies folded or retrenched.

These big players also began to acquire large shares in many of the basic cable and pay cable networks, leading to criticism that the. Cable industry was engaging in too much vertical integration-a process through which a select group of companies had the ability to produce, distribute, and exhibit their products without input or decision making from other companies.

 SMATV and Wireless cabl

Cable TV had been so strong in the early 1980s that several similar distribution industries sprung up and managed, at least for a while, to compete with cable and contribute to its leveling off in the mid-1980s. The two main distribution methods were satellite master antenna TV (SMATV) and wireless cable.

SMATV was sometimes referred to as "private cable" because it supplied TV programming to apartments, hotels, hospitals, and other units located on private property. It, too, became possible because of the 1979 FCC ruling that said no one needed a license to install a TV receive-only (TVRO) satellite dish. Before this, owners of apartment complexes often installed a regular TV antenna on top of an apartment building that was wired to each apartment. In this way, all apartment dwellers could receive broadcast TV signals without each having to place an antenna on the roof of the building. After the FCC's 1979 decision the apartment owners could contract to have satellite signals fed into this system, too.

For many years, the rivalry between cable and SMATV instigated many court cases to try to solve the problem of who could solicit which customers. Cable systems tried to prevent SMATV operations from taking hold in areas they had wired, and SMATV operators tried to prevent cable representatives from soliciting in their apartment complexes. The cable-SMATV antipathy has been less rancorous in recent years because a 1995 FCC ruling enabled cable companies to purchase SMATV systems and a number have done so.

 Wireless cable is really an oxymoron because cable, by definition, is a wire. The original name for this service was multichannel multipoint distribution service (MMDS), but that was such a mouthful that its proponents coined "wireless cable" because the technology involved over-the-air broadcasting but provided programming similar to cable TV. The broadcasting occurs in frequencies that are higher than conventional broadcast frequencies. They cannot be received with a regular TV set; a special antenna and downconverter system are needed. The wireless cable systems have a range of about 25 miles, so they cannot be used to send televised material over long distances.

The frequencies for wireless cable had been available since 1971, but they lay dormant for .many years, mainly because no one could figure out a way to make money using the channels. The advent of HBO and other pay-tv services helped several companies make money utilizing the frequencies to transmit pay movies to apartments, hotels, and homes. The first wireless cable systems only used one channel. As the business grew, the FCC allocated more channels for wireless cable so that individual companies could have as many as 33 channels and offer more programming services. At first, the multichannel growth of wireless cable alarmed the cable operators somewhat because they feared MMDS would take away business from cable systems. But now cable has many more channels than wireless cable, and the wireless systems, although they can now employ digital technologies to increase the number of program services on each channel, have had trouble gaining enough subscribers to stay out of bankruptcy.

Cable TV Regulations Revisited

From the 1980s on, the old issues of syndicated exclusivity, must-carry, and copyrights continued to affect the cable industry, and new regulatory issues also arose because of deregulation. In 1980, the FCC abolished the syndicated exclusivity ruling, allowing cable systems to import multiple stations and to play their programming without concern about whether the same programming would be on a local TV station. In 1988, however, after intense broadcaster lobbying, the FCC reinstated syndicated exclusivity. Now cable systems worried again about blacking out programs on superstations and distant stations. The superstations cooperated by trying not to show programs that might be airing on -local stations until at Least several weeks later, and some of the superstations abandoned their superstation status and became basic cable networks, which aren't subject to the syndicated exclusivity rules. These actions alleviated the syndicated exclusivity problem.

Must-carry, which originally caused little anxiety for either broadcasters or cablecasters, became controversial when cable went through its growth spurt. Cable owners wanted must-carries outlawed so that they could use their channels to carry the more profitable satellite services rather than local stations. They claimed that by having to carry little-watched religious, educational, and ethnic broadcast stations, they did not have channel space for public access, C-SPAN, and other cable programming services. Local stations wanted to be carried on the systems and even thought cable systems should pay them for their signals because they were of great value to cable. During the 1980s, must-carries were outlawed and reinstated a number of times, depending on which forces lobbied the hardest or won the court cases. In 1992, a new law set up a provision whereby broadcasters could choose must-carry or retransmission consent. If they chose must-carry, they were guaranteed a spot on the cable system. If they chose retransmission consent, they could ask the cable system to pay them for the privilege of carrying their signal. If cable system paid, the broadcasters would be richer, but the cable system had option of not carrying the station if it opted for retransmission consent. In many instances, the broadcasters and cable systems found a way to compromise. Instead of asking for money for retransmission of the signals, the stations asked channel space on the cable system so they could program additional material, for example, Cap Cities/ABC and Hearst, which owned ESPN, agreed to let cable system carry all ABC and Hearst-owned stations in return for a channel on which they could place a new service, ESPN2.

 In 1996, the Supreme Court ruled that cable systems must carry the signals of all local stations, although broadcasters "still opt for retransmission consent. The latest issue involves the numerous digital TV channels broadcasters are proposing. Broadcasters want cable to carry all, but the FCC ailed that cable need carry only one signal per station. Copyright, issues surfaced again. In 1983, the Copyright Royalty Tribunal, acting under its right to adjust fees, ordered cable systems to pay 3.75 percent (a [increase from the original 0.7 percent) of their gross receipts for many of imported distant signals…….In 1993, Congress abolished the Copyright royalty Tribunal, replacing it with ad hoc arbitration panels chosen by the Librarian of Congress. These arbitration panels have leaned toward even higher rates, but the cable systems have negotiated them downward and are also importing fewer distant signals so this is becoming less of an issue.

Cable, like broadcasting, came under the influence of the deregulation mood of the 1980s. A major piece of congressional legislation, the Cable Communications Policy Act of 1984, delineated the role of cable systems and local governments. The main positive change for cable operators was that cities with at least three broadcast stations could no longer regulate the rates that cable systems charged their customers for basic service. Instead, these charges were determined by the marketplace. However, the cable industry did not behave nobly under deregulation. With its monopolistic power, it raised basic cable rates as much as 50 percent over seven years. It was also laissez-faire about customer relations, making customers wait on the phone for long periods.

This led Congress to reregulation that culminated in a 1992 law giving the FCC authority to determine reasonable rates for basic services and to set service standards. The FCC rolled back rates and mandated that cable operators provide a 24-hour-a-day toll-free number and a convenient customer service location. The Telecommunications Act of 1996 leaned heavily toward more deregulation of cable, and some cable systems once again instituted robust rate hikes. But other systems were by then experiencing enough competition from satellite TV that they were intent on keeping their customers happy by instituting, at most, modest raises.

 

DBS revived

Satellite TV's status as a competitor to cable did not come easily. After STC backed out of the high-power DBS business in 1984, interest in the field remained dormant until the 1990s when Rupert Murdoch of Fox, whose company News Corp. was involved in DBS in other parts of the world, became interested in U.S. satellite-to-home opportunities. Murdoch formed an alliance with NBC, Cablevision Systems, and Hughes Communications for a DBS system to be called Sky Cable. The Sky Cable alliance dissolved quickly, the victim of clashing ideas and egos. Hughes, however, plodded along with the idea and eventually joined forces with USSB, a company owned by Stanley Hubbard that was one of the few original DBS applicants still interested in developing the service. In 1993, Hughes successfully launched a high-power satellite, and in 1994 Hughes and USSB jointly offered a 150-channeI digital satellite service that became known as DirecTV. In 1998, Hughes bought out USSB and operated DirecTV by itself.

The widespread consumer acceptance DirecTV engendered surprised even the most avid DBS supporters. Within six months, more than 500,000 households had paid $700 each for the 18-inch receiver dish and the decoder box that would enable their television sets to display programming coming directly from high-powered satellites. Satellite TV-was proving it could take business away from cable TV.

Why did Hughes/USSB succeed when all the 1980s ventures had failed? A number of factors were involved. Hughes, a satellite-building company, was able to perfect a high-power satellite that could deliver to homes. Also, with the help of RCA and Sony, it developed small reliable dishes that could be mounted on the sides of houses. Digital technology had improved greatly during the decade, and by offering digital signals, DirecTV could feature high-quality picture and sound. Digital improvements also allowed DirecTV to offer over a hundred channels, including ones for major sports events and top-rated movies. In 1992, Congress passed a law ordering cable networks to sell their programming to anyone who wanted it, not just cable systems. This law cleared the path for USSB and Hughes to obtain well-known, popular programming such as that on ESPN, MTV, and C-SPAN. Perhaps most important of all, in the mid-1990s, people were angry with their cable companies for raising rates, being slow to fix technical glitches, and not answering their phones. People were willing to spend $700 to quit their cable services and try something new.

The success of DirecTV was also a factor in killing off most of the backyard satellite reception business. The companies with programming on satellites had become more upset that the backyard dish owners were receiving the programming for free. Many services began scrambling their signals. This brought forth a surge in illegal decoders, but as scrambling improved and antipiracy laws loomed, these decoders became problematic. With the smaller dishes that DirecTV offered, many people who had the large dishes opted for the smaller dishes that were more cost-effective and convenient and did not carry a stigma of illegality.

While DirecTV was becoming successful, Rupert Murdoch still lingered in wings. In 1995, he formed an alliance with MCI to establish a satellite TV service, ASkyB. This proved to be too expensive for Murdoch, so he looked for an additional partner and found one in Charlie Ergen, who owned another would-be DBS company, EchoStar. But again egos and finances destroyed the relationship, and eventually Ergen established his own service, Dish Network. EchoStar then tried to buy DirecTV (even though Dish only had 5.5 million subscribers and DirecTV had 10 million), but the FCC nixed the merger in 2002 because it would create a monopoly. Murdoch, however, jumped in and was I successful in a 2003 bid to buy DirecTV for $6.6 billion. This acquisition adds to News Corp.'s worldwide satellite empire and also its media empire that | includes all the Fox properties.

One drawback of satellite TV services of the 1990s was that they lacked permission to deliver local stations to their subscribers. Although they tried a number of times to obtain this permission through Congress, the more powerful able TV business lobbied successfully to keep them at bay. However, in 1999, Congress passed a bill allowing DBS services to retransmit local stations into their local areas, often referred to as local-into-local. Along with this new freedom came restrictions-the same must-carry, syndicated exclusivity, and copyright rules that cable systems have. So far DirecTV and Dish have not viewed these restrictions as onerous. Being able to deliver local stations gives them a valuable new service that should bring even more subscribers into their fold. Despite its rocky history, the future for the DBS business looks positive.

Programming changes of the 1980s

The multitude of cable TV programming networks (which eventually also became satellite TV services) experienced many changes during the 1980s and 1990s.

In the area of pay cable, the number of players lessened as services merged, converted to basic, or went out of business. A new concept in pay programming arose called pay-per-view (PPV) TV. PPV enabled viewers who paid an extra one-time-only sum to see special events such as boxing matches and first-run movies. At first, most PPV plans asked subscribers to phone the cable company to order the event, which would then be sent through the wire only to those homes requesting and paying for it. As time progressed, special interactive equipment was developed that allowed the viewer to push a button on a remote-control-like device that enabled the special programming to be delivered to the TV set. Viewers were then billed for this extra service as part of their monthly cable bill. Many PPV services were proposed-and launched, renamed, reorganized and discontinued.

 Pay-per-view was not the instant success many hoped it would be. Those companies that stayed with the business experienced a slow but steady increase in subscribers and revenues.

Basic services had their share of problems from the mid-1980s on. The most highly touted failure was that of the CBS-owned cultural, service, CBS Cable, which stopped programming in 1983 after losing $50 million. The service programmed ambitious, high-quality television but did not receive sufficient financial support from either subscribers or advertisers. Its demise was almost heralded by some of the cable companies that resented the encroachment of the broadcast networks into their cable business because CBS had so aggressively touted its service.

Another well-publicized 1983 coup occurred when Ted Turner's Cable News Network slew .the giants, ABC and Westinghouse, by buying out their Satellite News Channel. This meant less competition for CNN, which was then able to proceed on more secure financial footing because it did not have to compete for viewers or advertisers with Satellite News Channel.

MTV ownership changed from Warner-Amex to Viacom, and its programming drew less attention than when the service first began. Several imitative music video services were started, but most of them failed, including one launched by Ted Turner that lasted less than a month. MTV changed its programming from 24 hours of music videos to a schedule that included some nonmusical programs aimed at the same audience who appreciated music videos.

From the mid-1980s into the 1990s, the rash of new programming services stopped but some new basic networks were introduced. The Discovery Channel, launched in 1985, provides nonfiction programming about nature and history. NBC launched the Consumer News and Business Channel (CNBC), and in 1991 Court TV became prominent with live, complete coverage of the William Kennedy Smith rape trial and then the O.J. Simpson murder trial in 1995. Ted Turner started a new general-purpose network, Turner Network Television (TNT), and a cartoon channel, and Time Warner absorbed all of the Turner properties in 1996. Several comedy channels started and soon merged into Comedy Central because of lack of audience and lack of programming. Comedy Central made a name for itself with an irreverent cartoon show, South Park. A plethora of home shopping networks were touted. Many of these disappeared as soon as they began because the market could not bear them all. The ones that survived did quite well.

Activity on the local public access and local origination channels also slowed during this period. Cable systems that had promised truckloa.ds of production equipment to local organizations tried as best as they could to delay these costly obligations. Local programming departments that had included five or six employees dwindled. The only local programming for some systems was messages typed on the screen about local news and events. They had, in essence, reverted to a sophisticated version of the early 3-by-5-inch cards. Some systems joined to form regional cable networks that programmed primarily sports. Local programming did not disappear, but it did not fill the multitude of channels promised in many of the franchise agreements.

Interactive services took a nosedive. Warner-Amex killed its highly touted Qube system by 1984, mainly because it was not profitable. In the 1990s, Time Warner experimented with interactive technology by installing a system in Florida called Full Service Network (FSN). Because of Warner's involvement, some jokingly referred to FSN as "Qube Squared." After two years of operation (1995-1997), Time Warner pulled the plug on FSN, attributing the closure to high costs and technical problems.

As the 21st century started both cable TV and satellite TV were poised for digital changes. "Digital" became the watchword in a number of different ways. DirecTV and Dish broadcast digitally from their inception, giving them a quality edge. Most of their programming is standard definition, but each system has a few channels that are high definition. Cable systems are gradually rebuilding their technical structure, changing from coaxial cable to fiber optics so that they can better accommodate digital. For both satellite and cable, using digital means they can offer hundreds of channels because a digitally based technology called compression allows video and audio to be squeezed into a much smaller space than previously possible.

Because of the possibility of hundreds of channels, a number of companies have started new channels. Although a few of the newer channels come from companies with no experience in the cable TV business, most of the channels are proposed by well-established companies that operate other channels. These companies have the infrastructure to develop and sell channels that will have only small numbers of interested viewers. For example, a new do-it-yourself channel that programs primarily information about remodeling homes was started by the same company that owns Home and Garden Television and the I Food Channel. Noggin, an educational channel, comes from Viacom, which also has Nickelodeon. Often the channels are just repackaged programs of another channel. For example, Discovery has reorganized the material it has broadcast over the years into channels dealing with such subjects as science, health, and children-each of which is a new channel. Lifetime created an offspring, Lifetime Movies, which shows the various made-for movies that have been on the parent channel. FX reruns a fair amount of old Fox programming.

Another innovation that is utilized by both satellite and cable is near-video-on-demand (NVOD). One movie is shown on several channels, each of which starts it at a different time—usually 15 minutes apart. A viewer who wants to see the movie but misses the 8:00 P.M. starting time on Channel 57 can catch it on Channel 58 stalling at 8:15. Some NVOD is similar to PPV in that the movie is sent to all paying subscribers at the same time; it is just sent more often. Premium channels such as HBO also have a form of NVOD in that they send multiple versions of their programming over different channels. Some of this is I address' different time zones, but it also gives viewers flexibility as to when by watch the program material.

Even further up the digital chain is video-on-demand (VOD). Individual viewers can watch programs precisely when they want to. A number of experiments are under way for VOD, most of which involve a large server at a cable system that contains an enormous amount of information-movies, TV programs, video games, and so on. When a consumer asks for a particular movie (or anything else), it can be downloaded on one of the cable system channels into a digital box on top of the customer's TV set. The movie will also remain in the cable server so that another customer can request and receive it. The consumer can then play the movie, stop it, rewind, and fast-forward at will.

Digital technologies have also enabled cable (and to a lesser degree, satellite TV) to offer services traditionally offered, by phone companies. Cable systems offer customers internet access through cable modems that compete in speed and accessibility with the phone companies' digital subscriber line (DSL). The cable companies have also started nibbling at providing conventional telephone service.

Another trend of the 21st century was started by The Telecommunications Act of 1996 that encouraged cable companies, satellite companies, broadcasters, internet companies, and phone companies to enter one another's businesses, preferably by joining forces. This increased an already flourishing merger market. A number of unexpected, flamboyant mergers and buyouts occurred. For example, in 2000, internet company AOL bought Time Warner, the second-largest cable system owner. No one would have imagined that a relatively small internet-based company could have such clout within one of the big communications giants, but this was undertaken when internet company stocks were soaring to unprecedented heights (see Chapter 5). The combination didn't work out as planned, however, and Time Warner eliminated AOL from its company name in 2003.

Earlier, in 1998, phone company AT&T announced a merger with the largest cable MSO of the time, TCI. In essence, TCI disappeared and the phone company became the country's largest cable system operation. AT&T didn't master the cable business, however, and in 2002 it sold its cable operation to Comcast, a company that had been in cable for many years. Some of the combinations have stuck, however. The 1999 CBS-Viacom merger placed a conventional broadcaster in the same corporate structure as a major cable network owner of such channels as MTV and Nickelodeon. Rupert Murdoch's purchase of DirecTV put broadcasting and satellite TV under the same roof. And there are more ideas in the offing. The cable company, Cablevision, for example, has proposed a new high-end satellite service that would program only HDTV material. The cable network programming seen on cable and satellite TV has improved greatly, with many networks that previously had shown theatrical movies or commercial TV reruns starting to produce their own programming. HBO, in particular, was very successful with original programming, in part because it can be more graphic in terms of sex and violence than commercial networks. At the beginning of the 2000s, HBO started ousting the broadcast networks in major Emmy categories, especially with The Sopranos, an ongoing dramatic series about a New Jersey mafia family, and Sex and the City, the candid portrayal of four women friends and their interactions concerning men.

As cable network programming becomes more sophisticated and popular, the networks have raised the rates they charge the cable and satellite distributors and have made other demands related to carriage of related programming. The rancor has been particularly high in relation to ESPN, which charges distributors more money than any other it work. The head of Cox Cable pointed out that ESPN captures 4 percent of Cox's system viewers but accounts for 18 percent of its costs. Regional sports can be expensive, too, and in 2002 the New York Yankees YES network went dark on that city's Cablevision systems because YES and Cablevision couldn't agree on rates.

Issues and the Future

The fees cable networks charge distributors is certainly an issue for the future. What cable or satellite system wants to be without ESPN? So can ESPN charge as much as it wants? If a system does balk at the cost and removes ESPN, what happens to the sports fans who want to see the channel?

This issue leads to an even larger one. As companies merge and buy each other out, the total number of companies involved in cable and satellite TV shrinks, but the companies that are involved get larger. When the companies that own distribution systems also own networks, they have an incentive to run their own networks on their systems. This may not always serve the viewers' best interests, especially if the systems are trying to curtail access of networks owned by another company. For example, a Time Warner cable system might be more likely to give consumers incentives to subscribe to HBO, which it owns, than to Showtime, which is owned by Viacom, even though some of those consumers would prefer Showtime.

In a slightly different scenario, companies that own programming networks and distribution systems could theoretically withhold (or charge a very high fee for) programming material from other distribution services in hopes that consumers will choose their distribution means. For example, Fox could withhold FX, Fox News, and Fox Sports from cable in hopes that consumers would leave cable and subscribe to DirecTV in order to get those channels.

In cable TV, the big companies have ousted the smaller companies that once  were its lifeblood. Small MSOs joke about being listed in the top 25 cable system owners, not because they have grown but because of all the mergers and buyouts among the large MSOs (see Exhibit 3.18).62 But cable and satellite TV are expensive businesses that need constant updating as technology changes. The large companies have the deep pockets needed to make these investments.

Much of what happens to cable and satellite TV in the future will depend on their interactions with other industries. Not only do they compete with broadcast TV on such issues as must-carry, but they have the agendas of newer industries to consider. Internet companies are serious about delivering video-on-demand, and the phone companies want to remain the main purveyors of the internet and phone services. But cable needs a "new hit" because subscriber growth is flat and government would be unfriendly to consumer price hikes. Offering phone service might be just the shot in the arm that it needs.

Probably most crucial of all, cable and satellite have each other as competitors. This can drive their costs up, but it can be of value to consumers because they can obtain cable network programming from two sources; whereas, in the past their one cable system had a monopoly. One element that cable and satellite are competing on is pushing digital video recorders into the home. The satellite systems and some cable systems have built-in software that enables viewers to record material to watch later-often slapping the commercials.

Satellite and cable can also compete on offering HDTV programming. Neither is particularly interested in distributing the HDTV signals of broadcast stations, however. They want to save HDTV space for services that will bring in money. But government has said they must carry some HDTV broadcast signals. There had been a bit of a conflict when some people couldn't get the 2004 Super Bowl in high definition because the cable companies and local broadcast stations carrying the Bowl hadn't made agreements for the carriage. Customers had been used to seeing sports events in HDTV on ESPN and Fox Sports and didn't understand why the Super Bowl wouldn't also be in HDTV.

Cable has found digital television (DTV) to be a rather hard sell. Many people who have subscribed quickly dropped the digital service and returned to their old analog subscription because they found they were just paying more to watch the same 10 or 15 channels they had always watched. Part of the problem may be that so many of the digital channels are the same, just repeating programming for different time zones. DBS has been digital since the beginning so has not faced this resistance problem. But with both cable and satellite, there is the question of just how many channels consumers can watch…..That brings up another issue. Consumers and the government are talking about making cable (and perhaps satellite) offer channels a' la carte. In other words, consumers would be able to order and pay for only the channels they want to watch instead of having to buy the packages of channels that the cable systems order. Of course, the cable networks and systems are opposed to this because they would sell less.

Last, but certainly not least, cable and satellite may be in for rougher times in terms of indecent programming (see Chapter 10). They have been exempt from many laws and regulations in this regard because people have to pay to bring the services into their homes. But as citizens' groups and legislators become more upset about indecency, they may find ways to curb what is on cable and satellite. One county in Michigan won a 2004 court case by declaring that a cable public access channel was a public place and that exposing oneself on an access show violated Michigan's indecent exposure law.

Summary

Cable TV and satellite TV have different historical roots. Cable started in the 1940s as a service to bring broadcast TV to areas that had poor reception and had a huge growth period during the 1980s. DBS started during the 1980s and had its major growth period starting in the 1990s.

In terms of ownership, cable TV was first owned by small mom-and-pop companies, and then transformed to MSOs. Today it is dominated by several large companies capable of vertical integration. The Telecommunications Act of 1996 spurred interesting mergers, some of which failed. DBS was started by medium-sized companies such as STC, but they didn't have deep enough pockets to last through all the start-up problems of the 1980s. It took a company that built satellites, Hughes, to get DBS off the ground—literally. Other companies have come and gone, and now Murdoch's News Corp. is in charge of DirecTV, the largest satellite system. The power that large companies wield in both cable and satellite is an issue.

Cable has been more regulated than satellite TV, although neither is as highly regulated as broadcast TV. Distant signal importation, syndicated exclusivity, copyright, and must-carry have been perennial regulatory issues for cable, with DBS now also coming under must carry and its retransmission provisions. Cable's franchising process with city councils is unique. At first it was a sleepy process, but it became very active as cable boomed in the 1980s. Deregulation and reregulation have also affected cable more than satellite because cable was highly visible during the 1980s and early 1990s. DBS was able to start because of a 1979 FCC ruling that no one needed a license for a TVRO. Satellite TV has also had to deal with Congress to get its local-into-local rulings. Currently there is government interest in the concept of a la carte, which could affect both cable and satellite.

Technologically, cable started with coaxial cable that carried TV signals to individual homes. As technology has improved with fiber optics and compression, the number of channels cable can offer has increased. Satellite TV was difficult to get started because of technological problems involved with transmitting from outer space to homes, but once started, it, too, made use of compression to send digital programming. Cable is playing catch-up on digital, and both media are working to incorporate HDTV and other digital services in their own ways.

In the early days cable TV programming consisted simply of retransmitting broadcast signals to areas with poor reception. Modest local origination such as weather indicators was tried by some systems. Public access and local origination also stated fairly early and became more important during the frantic franchising period and less important afterward. HBO was the vehicle that led to an avalanche of pay and basic networks that, after a shakedown, have become the main programming on current cable and satellite TV. Cable has also flirted with various forms of interactive programming, such as Qube. Historically cable has exhibited more talk than action in the interactive area, but recently its cable modems have been successful. Satellite TV was able to broadcast cable network material because of a 1992 law requiring cable networks to make their programming available to competitors. Now cable and satellite compete with ideas related to PPV, NVOD and VOD. Current programming issues include indecency and the fees cable networks charge.

Cable TV and satellite TV have become competitors, but they also have (or have had) as competitors SMATV, MMDS, subscription TV, and backyard satellite, as well as internet providers and phone companies.

 

 

The end